Note 5 - Employee Benefit Plans

6 Months Ended

Jun. 30, 2013

Pension and Other Postretirement Benefits Disclosure [Text Block]

Pension and Other Postretirement Benefits Disclosure [Text Block]

Note 5 - Employee Benefit Plans

Pension Benefits

On December 31, 2012, the AGL Resources Inc. Retirement Plan (AGL Plan), the Nicor Companies Pension and Retirement Plan (Nicor Plan) and the Employees’ Retirement Plan of NUI Corporation (NUI Plan) were merged with, and into, the AGL Plan. The eligibility and benefit terms for participants under the Nicor Plan and the NUI Plan were not changed as a result of the plan merger. The AGL Plan is described in Note 6 to our Consolidated Financial Statements and related notes included in Item 8 of our 2012 Form 10-K.

Following are the components of our pension benefit costs for the periods indicated.

	Three months ended June 30,						Six months ended June 30,
In millions	2013			2012			2013			2012
Service cost	$	7		$	7		$	15		$	14
Interest cost		11			11			21			22
Expected return on plan assets		(15	)		(16	)		(31	)		(32	)
Net amortization of prior service cost		(1	)		-			(1	)		(1	)
Recognized actuarial loss		9			8			17			17
Net periodic pension benefit cost	$	11		$	10		$	21		$	20

Retiree Welfare Benefits

On December 31, 2012, the Nicor Gas Welfare Benefit Plan (Nicor Welfare Plan) was terminated and as of January 1, 2013, all participants under that plan became eligible to participate in the Health and Welfare Plan for Retirees and Inactive Employees of AGL Resources Inc. (AGL Welfare Plan). This change in plan participation eligibility did not affect the benefit terms under the predecessor plans. The Nicor Welfare Plan benefits are now being offered to such participants under the AGL Welfare Plan. The benefits of the AGL Welfare Plan are described in Note 6 to our Consolidated Financial Statements and related notes included in Item 8 of our 2012 Form 10-K.

Following are the components of our retiree welfare benefit costs for the periods indicated.

	Three months ended June 30,						Six months ended June 30,
In millions	2013			2012			2013			2012
Service cost	$	-		$	1		$	1		$	2
Interest cost		4			4			7			8
Expected return on plan assets		(2	)		(2	)		(3	)		(3	)
Net amortization of prior service cost		(1	)		-			(2	)		(1	)
Recognized actuarial loss		2			2			4			5
Net periodic welfare benefit cost	$	3		$	5		$	7		$	11

Capitalized Costs

Net pension benefit and net welfare benefit costs are included in operation and maintenance expense, except for a portion that is capitalized as a cost of constructing natural gas distribution facilities.

Contributions

Our employees generally do not contribute to these pension and retiree welfare plans. We fund the qualified pension plan by contributing at least the minimum amounts required by applicable regulations and as recommended by our actuary. However, we may contribute in excess of the minimum required amounts.

As a result of merging the pension plans, there were no contributions required during the six months ended June 30, 2013. We contributed a combined $24 million to the AGL Plan and the NUI Plan during the same period last year. For more information on our pension plans, see Note 6 to our Consolidated Financial Statements and related notes included in Item 8 of our 2012 Form 10-K.