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Inventory, Linefill and Base Gas and Long-term Inventory
 6 Months Ended
Jun. 30, 2015
Inventory, Linefill and Base Gas and Long-term Inventory  
Inventory, Linefill and Base Gas and Long-term Inventory

Note 5—Inventory, Linefill and Base Gas and Long-term Inventory

 

Inventory, linefill and base gas and long-term inventory consisted of the following as of the dates indicated (barrels and natural gas volumes in thousands and carrying value in millions):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

June 30, 2015

 

 

December 31, 2014

 

 

    

 

    

Unit of

    

Carrying

    

Price/

    

    

    

    

Unit of

    

Carrying

    

Price/

 

 

 

Volumes

 

Measure

 

Value

 

Unit (1)

 

 

Volumes

 

Measure

 

Value

 

Unit (1)

 

Inventory

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Crude oil

 
12,916

 

barrels

 

$
649

 

$
50.25

 

 
6,465

 

barrels

 

$
304

 

$
47.02

 

NGL

 
12,931

 

barrels

 

 
213

 

$
16.47

 

 
13,553

 

barrels

 

 
454

 

$
33.50

 

Natural gas

 
16,342

 

Mcf

 

 
45

 

$
2.75

 

 
32,317

 

Mcf

 

 
102

 

$
3.16

 

Other

 

N/A

 

 

 

 
34

 

 

N/A

 

 

N/A

 

 

 

 
31

 

 

N/A

 

Inventory subtotal

 

 

 

 

 

 
941

 

 

 

 

 

 

 

 

 

 
891

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Linefill and base gas

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Crude oil

 
13,195

 

barrels

 

 
790

 

$
59.87

 

 
11,810

 

barrels

 

 
744

 

$
63.00

 

NGL

 
1,348

 

barrels

 

 
48

 

$
35.61

 

 
1,212

 

barrels

 

 
52

 

$
42.90

 

Natural gas

 
29,812

 

Mcf

 

 
138

 

$
4.63

 

 
28,612

 

Mcf

 

 
134

 

$
4.68

 

Linefill and base gas subtotal

 

 

 

 

 

 
976

 

 

 

 

 

 

 

 

 

 
930

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Long-term inventory

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Crude oil

 
2,420

 

barrels

 

 
134

 

$
55.37

 

 
2,582

 

barrels

 

 
136

 

$
52.67

 

NGL

 
1,652

 

barrels

 

 
25

 

$
15.13

 

 
1,681

 

barrels

 

 
50

 

$
29.74

 

Long-term inventory subtotal

 

 

 

 

 

 
159

 

 

 

 

 

 

 

 

 

 
186

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

 

 

 

 

$
2,076

 

 

 

 

 

 

 

 

 

$
2,007

 

 

 

 

 

(1)

Price per unit of measure is comprised of a weighted average associated with various grades, qualities and locations. Accordingly, these prices may not coincide with any published benchmarks for such products.

 

At the end of each reporting period, we assess the carrying value of our inventory and make any adjustments necessary to reduce the carrying value to the applicable net realizable value. Any resulting adjustments are a component of “Purchases and related costs” on our accompanying Condensed Consolidated Statements of Operations. We recorded a charge of $24 million during the six months ended June 30, 2015, which primarily related to the writedown of our NGL inventory due to declines in prices during the first quarter of 2015. The loss was substantially offset by a portion of the derivative mark-to-market gain that was recognized in the fourth quarter of 2014. See Note 8 for discussion of our derivative and risk management activities. During the six months ended June 30, 2014, we recorded a charge of $37 million related to the writedown of our natural gas inventory that was purchased in conjunction with managing natural gas storage deliverability requirements during the extended period of severe cold weather in the first quarter of 2014.