Restructuring And Transaction Costs

12 Months Ended

Dec. 31, 2016

Restructuring And Related Activities [Abstract]

Restructuring And Transaction Costs

6. Restructuring and Transaction Costs

The following table summarizes Devon’s restructuring liabilities presented in the accompanying consolidated balance sheets.

	Other		Other
	Current		Long-term
	Liabilities		Liabilities			Total
	(Millions)
Balance as of December 31, 2014	$	13	$	7		$	20
Changes related to prior years' restructurings		—		56			56
Balance as of December 31, 2015	$	13	$	63		$	76
Changes due to 2016 workforce reductions		29		6			35
Changes related to prior years' restructurings		6		(7	)		(1	)
Balance as of December 31, 2016	$	48	$	62		$	110

Reduction in Workforce

In 2016, Devon recognized employee-related and other costs associated with a reduction in workforce that was made in response to the depressed commodity price environment. The following table summarizes restructuring and transaction costs presented in the accompanying consolidated comprehensive statement of earnings.

	Year Ended December 31, 2016
	(Millions)
2016 reduction in workforce:
Employee related costs	$	227
Lease obligations		20
Asset impairments		3
Transaction costs		17
Restructuring and transaction costs	$	267

Of these employee-related costs, approximately $60 million resulted from accelerated vesting of share-based grants, which are noncash charges. Additionally, approximately $24 million resulted from estimated defined benefit settlements. These cash and noncash charges included estimates for employees released from service during 2016, as well as amounts based on the number of employees impacted by certain of its non-core asset divestitures.

Devon ceased using certain office space that was subject to non-cancellable operating lease arrangements. Consequently, Devon recognized restructuring costs that represent the present value of its future obligations under the leases. Additionally, Devon recognized asset impairment charges for leasehold improvements and furniture associated with the office space it ceased using.

Transaction Costs

In 2016, Devon and EnLink recognized transaction costs primarily associated with the closing of the acquisitions discussed in Note 2.

Prior Years’ Restructurings

In 2015, Devon recognized $24 million of employee-related and other costs associated with the reduction in workforce made subsequent to the completion of the Jackfish development projects and a decrease in planned Canadian capital investment resulting from the drop in commodity prices. Devon incurred employee severance, lease obligation and other costs related to the vacated office space as part of the cost reduction plan.

As part of the U.S. corporate headquarters office consolidation, Devon recognized an additional $54 million expense in 2015, due to a lack of demand for vacated office space and the inability to fully sublease remaining office space.

In 2014, Devon recognized $46 million of employee-related and other costs associated with its divestiture of certain Canadian assets. Approximately $15 million of the employee related costs resulted from accelerated vesting of share-based grants, which are noncash charges.