Dispositions

Oil Sands Mining Segment

On May 31, 2017 we closed on the sale of our Canadian business, which included our 20% non-operated interest in the AOSP to Shell and Canadian Natural Resources Limited (“CNRL”) for $2.5 billion, excluding closing adjustments. Under the terms of the agreement, $1.8 billion was paid to us upon closing and the remaining proceeds will be paid in the first quarter of 2018. At closing we received two notes receivable for the remaining proceeds, each with a face value of $375 million. We initially recorded these notes receivable at fair value and, in subsequent periods, will report them at amortized cost. See Note 14 for fair value measurements. Our notes receivable are with 10084751 Canada Limited (“Canada Limited”), an affiliate of Shell Canada Limited, and CNRL. The Canada Limited note receivable is guaranteed by Shell Canada Limited and the CNRL note receivable is guaranteed by Toronto Dominion Bank. In the first quarter of 2017, we recorded an after-tax non-cash impairment charge of $4.96 billion primarily related to the property, plant and equipment of our Canadian business. As the effective date of the transaction is January 1, 2017, we recorded a loss on sale of $43 million during the second quarter of 2017 due to second quarter results of operations from our Canadian business that were recorded in our financial statements but transferred to the buyer upon closing.

Our Canadian business is reflected as discontinued operations in the consolidated statements of income and the consolidated statements of cash flows for all periods presented. The following table contains select amounts reported in our consolidated statements of income as discontinued operations:



	Three Months Ended September 30,					Nine Months Ended September 30,
(In millions)		2017		2016		2017			2016
Total sales and other revenues and other income		$	—	$	239	$	431		$	598
Net gain (loss) on disposal of assets		—		—		(43		)	—
Total revenues and other income		—		239		388			598
Costs and expenses:
Production expenses		—		135		254			441
Depreciation, depletion and amortization		—		72		40			181
Impairments		—		—		6,636			—
Other		—		9		25			69
Total costs and expenses		—		216		6,955			691
Pretax income (loss) from discontinued operations		—		23		(6,567		)	(93		)
Provision (benefit) for income taxes		—		9		(1,674		)	(28		)
Income (loss) from discontinued operations		$	—	$	14	$	(4,893	)	$	(65	)

The following table presents the carrying value of the major categories of assets and liabilities of our Canadian business reported as discontinued operations and assets and liabilities from continuing operations, that are reflected as held for sale on our consolidated balance sheets at September 30, 2017 and December 31, 2016:



	September 30,		December 31,
(In millions)	2017		2016
Assets held for sale
Current assets:
Cash and cash equivalents	$	—	$	2
Accounts receivables	—		129
Inventories	—		91
Other	—		4
Total current assets held for sale—discontinued operations	—		226
Total current assets held for sale—continuing operations	11		1
Total current assets held for sale	$	11	$	227

Noncurrent assets:
Property, plant and equipment, net	$	—	$	8,991
Other	—		106
Total noncurrent assets held for sale—discontinued operations	—		9,097
Total noncurrent assets held for sale—continuing operations	54		1
Total noncurrent assets held for sale	$	54	$	9,098

Liabilities associated with assets held for sale
Current liabilities:
Accounts payable	$	—	$	111
Other	—		10
Total current liabilities held for sale—discontinued operations	—		121
Total current liabilities held for sale—continuing operations	—		—
Total current liabilities held for sale	$	—	$	121

Noncurrent liabilities:
Asset retirement obligations	$	—	$	95
Deferred tax liabilities	—		1,669
Other	—		20
Total noncurrent liabilities held for sale—discontinued operations	—		1,784
Total noncurrent liabilities held for sale—continuing operations	9		7
Total noncurrent liabilities held for sale	$	9	$	1,791

United States E&P Segment

As disclosed above, we closed on the sale of our Canadian business in May of 2017. This sale included interests in our exploration stage in-situ leases which were included within our historically named North America E&P Segment. See Note 1 for further detail. These interests have been reflected as discontinued operations and are included within the disclosure above.

In July 2017, we entered into an agreement to sell certain conventional assets in Oklahoma. We closed on the sale in September 2017 for proceeds of $25 million, subject to closing adjustments, and recognized a pre-tax gain of $21 million.

In September 2016, we entered into an agreement to sell certain non-operated CO2 and waterflood assets in West Texas and New Mexico. The sale closed in late October for proceeds of $235 million, and we recognized a total pre-tax gain of $63 million. During the third quarter 2016, we sold certain non-operated assets primarily in West Texas and New Mexico to multiple purchasers for combined proceeds of approximately $67 million, and recognized a total pre-tax gain of $55 million.

In April 2016, we announced the sale of our Wyoming upstream and midstream assets. During the second quarter 2016, we received proceeds of approximately $690 million and recorded a pre-tax gain of $266 million with the remaining asset sales closing in November 2016 for proceeds of $155 million, excluding closing adjustments. A pre-tax gain of $38 million was recognized in the fourth quarter 2016.

In March and April 2016, we entered into separate agreements to sell our 10% working interest in the outside-operated Shenandoah discovery in the Gulf of Mexico, operated natural gas assets in the Piceance basin in Colorado and certain undeveloped acreage in West Texas and New Mexico, for a combined total of approximately $80 million in proceeds. We closed on certain of the asset sales and recognized a net pre-tax loss on sale of $48 million in the second quarter of 2016. In October 2017 we closed on the remaining Piceance basin asset sale and expect to recognize a pre-tax gain of approximately $30 million in the fourth quarter of 2017.

International E&P Segment

In the third quarter of 2017, we entered into separate agreements to sell certain non-core properties in our International E&P segment for combined proceeds of $53 million, before closing adjustments. Certain of these assets are classified as held for sale in the consolidated balance sheet as of September 30, 2017, with total assets of $63 million and total liabilities of $2 million. We expect these transactions to close within one year. See Note 13 for further detail on impairment expenses recognized concurrently with these agreements.