Goodwill And Other Intangible Assets

12 Months Ended

Dec. 31, 2016

Goodwill And Intangible Assets Disclosure [Abstract]

12.	Goodwill and Other Intangible Assets

Goodwill

The following table presents a summary of Devon’s goodwill.

	U.S.			EnLink			Total
	(Millions)
Balance as of December 31, 2014	$	2,618		$	3,685		$	6,303
Acquired during period		—			57			57
Impairment		—			(1,328	)		(1,328	)
Balance as of December 31, 2015	$	2,618		$	2,414		$	5,032
Acquired during period		—			2			2
Asset divestitures		(197	)		—			(197	)
Impairment		—			(873	)		(873	)
Balance as of December 31, 2016	$	2,421		$	1,543		$	3,964

The following table presents the General Partner’s and EnLink’s goodwill activity by reporting unit.

	Texas			Louisiana			Oklahoma		Crude and Condensate			General Partner				Total
	(Millions)
Balance as of December 31, 2014	$	1,168		$	787		$	190	$	113			$	1,427			$	3,685
Acquired during period		28			—			—		29				—				57
Impairment		(492	)		(787	)		—		(49	)			—				(1,328	)
Balance as of December 31, 2015	$	704		$	—		$	190	$	93			$	1,427			$	2,414
Acquired during period		2			—			—		—				—				2
Impairment		(473	)		—			—		(93	)			(307	)			(873	)
Balance as of December 31, 2016	$	233		$	—		$	190	$	—			$	1,120			$	1,543

Asset Divestitures

In conjunction with the U.S. non-core upstream asset divestitures in 2016 discussed in Note 2, Devon removed $197 million of goodwill, which was allocated to these assets.

Impairment

As further discussed in Note 1, Devon performs an annual impairment test of goodwill at October 31, or more frequently if events or changes in circumstances indicate that the carrying value of a reporting unit may not be recoverable. Sustained weakness in the overall energy sector driven by low commodity prices, together with a decline in EnLink’s unit price, caused a change in circumstances warranting an interim impairment test of EnLink’s reporting units in the first quarter of 2016. Based on that test, EnLink recorded a noncash goodwill impairment.

During 2015, as a result of interim and annual impairment tests of goodwill, noncash goodwill impairments were recorded related to EnLink’s Texas, Louisiana and Crude and Condensate reporting units.

Other Intangible Assets

In the third quarter of 2015, Devon recorded a $223 million noncash impairment of intangible assets related to EnLink’s Crude and Condensate reporting unit resulting from an assessment of EnLink’s customer relationships. Fair value measurements were utilized for the impairment analysis of definite-lived intangible assets, which included discounted cash flow estimates, consistent with those utilized in the goodwill impairment assessment.

The following table presents other intangible assets reported in other long-term assets in the accompanying consolidated balance sheets.

	December 31, 2016			December 31, 2015
	(Millions)
Customer relationships	$	1,796		$	745
Accumulated amortization		(172	)		(55	)
Net intangibles	$	1,624		$	690

The weighted-average amortization period for the customer relationships is 14 years. Amortization expense for intangibles was approximately $117 million, $56 million and $36 million for the years ended 2016, 2015 and 2014, respectively. The remaining aggregate amortization expense is estimated to be approximately $118 million in each of the next five years.

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

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