On December 17, 2019, Devon announced that it had entered into an agreement to sell its Barnett Shale assets to BKV. Devon concluded that the transaction was a strategic shift and met the requirements of assets held for sale and discontinued operations upon the authorization to enter the agreement by Devon’s Board of Directors. As part of its assessment, Devon effectively exited its last natural gas focused asset and the transaction resulted in a material reduction to total assets, revenues, net earnings and total proved reserves. Estimated proved reserves associated with Devon’s Barnett Shale assets were approximately 45% of the total proved reserves. As a result, Devon classified the results of operations and cash flows related to its Barnett Shale assets, inclusive of Barnett properties divested in previous reporting periods located primarily in Johnson and Wise counties, Texas, as discontinued operations on its consolidated financial statements.

In conjunction with the divestiture agreement, which was amended in April 2020, Devon recognized a $182 million and $748 million asset impairment related to the Barnett Shale assets in 2020 and 2019, respectively, primarily due to the difference between the net carrying value and the purchase price, net of estimated customary purchase price adjustments, which qualifies as a level 2 fair value measurement. Approximately $88 million of the U.S. reporting unit goodwill was allocated to the Barnett Shale assets. Additionally, Devon ceased depreciation for all plant, property and equipment classified as assets held for sale on the date the sales agreement was approved by the Board of Directors.

On October 1, 2020, Devon completed the sale of its Barnett Shale assets to BKV for proceeds, net of purchase price adjustments, of $490 million, including a $170 million deposit previously received in April 2020. Additionally, the agreement provides for contingent earnout payments to Devon of up to $260 million based upon future commodity prices, with upside participation beginning at a $2.75 Henry Hub natural gas price or a $50 WTI oil price. The contingent payment period commences on January 1, 2021 and has a term of four years. The valuation of the future contingent earnout payments included within other current assets in the December 31, 2020 balance sheet was $66 million. The value was derived utilizing a Monte Carlo valuation model and qualifies as a level 3 fair value measurement.

As of December 31, 2020, Devon has classified approximately $20 million of cash as restricted cash on the consolidated balance sheets for obligations associated with the abandonment of certain gas processing contracts related to divestitures of other Barnett Shale assets that occurred in 2018. Cash payments for these charges total approximately $2 million per quarter.

In the second quarter of 2019, Devon completed the sale of its Canadian business for $2.6 billion ($3.4 billion Canadian dollars), net of purchase price adjustments, and recognized a pre-tax gain of $223 million ($425 million net of tax, primarily due to a significant deferred tax benefit) in 2019. Current (cash) income and withholding taxes associated with the Canadian business were approximately $175 million and were paid in the first half of 2020. Devon concluded that the transaction was a strategic shift and met the requirements of assets held for sale and discontinued operations based upon the following: 1) Devon was exiting its entire heavy oil and Canadian operations; 2) Devon’s Canadian operations were a separate reportable segment and a component of Devon’s business; and 3) the transaction resulted in a material reduction in total assets, revenues, net earnings and total proved reserves. The disposition of substantially all of Devon’s Canadian oil and gas assets resulted in Devon releasing its historical cumulative foreign currency translation adjustment of $1.2 billion from accumulated other comprehensive earnings to be included within the gain computation. The historical cumulative foreign currency translation portion of the gain is not taxable.

During the third quarter of 2019, Devon utilized a portion of the sales proceeds to early retire $500 million of the 4.00% senior notes due July 15, 2021 and $1.0 billion of the 3.25% senior notes due May 15, 2022. Devon recognized a charge on the early retirement of these notes consisting of $52 million in cash retirement costs and $6 million of noncash charges.

As of December 31, 2020, Devon has classified approximately $170 million of cash as restricted cash on the consolidated balance sheets for obligations retained related to the Canadian business. The remaining obligations consist of a firm transportation agreement and office leases. Cash payments for these charges total approximately $8 million per quarter.

On June 6, 2018, Devon announced that it had entered into an agreement to sell its aggregate ownership interests in EnLink and the General Partner for $3.125 billion. Upon entering into the agreement to sell its ownership interest in June 2018, Devon concluded that the transaction was a strategic shift and met the requirements of assets held for sale and discontinued operations. As a result, Devon classified the results of operations and cash flows related to EnLink and the General Partner as discontinued operations on its consolidated financial statements.

On July 18, 2018, Devon completed the sale of its aggregate ownership interests in EnLink and the General Partner for $3.125 billion and recognized a gain of approximately $2.6 billion ($2.2 billion after-tax). Current (cash) income tax associated with the transaction was approximately $12 million. The vast majority of the tax effect relates to deferred tax expense offset by the valuation allowance adjustment.

As part of the sale agreement, Devon extended its fixed-fee gathering and processing contracts with respect to the Bridgeport and Cana plants with EnLink through 2029. Although the agreements were extended to 2029, the minimum volume commitments for the Bridgeport and Cana plants expired at the end of 2018. Devon had minimum volume commitments for gathering and processing of 77-128 MMcf/d with EnLink at the Chisholm plant which expired at the end of 2020.

Prior to the divestment of Devon’s aggregate ownership of EnLink and the General Partner, certain activity between Devon and EnLink were eliminated in consolidation. Subsequent to the divestment, all activity related to EnLink represent third-party transactions and are no longer eliminated in consolidation.

During 2020, 2019 and from the period of July 19, 2018 through December 31, 2018, Devon had net outflows of approximately $430 million, $560 million and $380 million with EnLink, respectively, which primarily related to gathering and processing expenses. These net outflows represent gross cash amounts and not net working interest amounts.

The following table presents the amounts reported in the consolidated statements of comprehensive earnings as discontinued operations.

Year ended December 31,	Barnett Shale			Canada			EnLink			Total
2020
Oil, gas and NGL sales	$	263		$	—		$	—		$	263
Total revenues		263			—			—			263
Production expenses		214			—			—			214
Asset impairments		182			—			—			182
Asset dispositions		(4	)		5			—			1
General and administrative expenses		—			3			—			3
Financing costs, net		—			(3	)		—			(3	)
Restructuring and transaction costs		—			9			—			9
Other expenses		10			(1	)		—			9
Total expenses		402			13			—			415
Earnings (loss) from discontinued operations before income taxes		(139	)		(13	)		—			(152	)
Income tax benefit		(11	)		(13	)		—			(24	)
Net earnings (loss) from discontinued operations, net of tax	$	(128	)	$	—		$	—		$	(128	)
2019
Oil, gas and NGL sales	$	486		$	741		$	—		$	1,227
Oil, gas and NGL derivatives		—			(113	)		—			(113	)
Marketing and midstream revenues		—			38			—			38
Total revenues		486			666			—			1,152
Production expenses		306			293			—			599
Exploration expenses		—			13			—			13
Marketing and midstream expenses		—			18			—			18
Depreciation, depletion and amortization		77			128			—			205
Asset impairments		748			37			—			785
Asset dispositions		1			(223	)		—			(222	)
General and administrative expenses		—			34			—			34
Financing costs, net		—			87			—			87
Restructuring and transaction costs		—			248			—			248
Other expenses		11			6			—			17
Total expenses		1,143			641			—			1,784
Earnings (loss) from discontinued operations before income taxes		(657	)		25			—			(632	)
Income tax benefit		(142	)		(216	)		—			(358	)
Net earnings (loss) from discontinued operations, net of tax	$	(515	)	$	241		$	—		$	(274	)
2018
Oil, gas and NGL sales	$	777		$	814		$	—		$	1,592
Oil, gas and NGL derivatives		—			151			—			150
Marketing and midstream revenues		—			95			3,567			3,662
Total revenues		777			1,060			3,567			5,404
Production expenses		467			605			—			1,072
Exploration expenses		—			48			—			48
Marketing and midstream expenses		—			42			2,912			2,954
Depreciation, depletion and amortization		100			330			244			674
Asset dispositions		14			—			(2,607	)		(2,593	)
General and administrative expenses		—			76			65			141
Financing costs, net		—			14			98			112
Restructuring and transaction costs		—			17			—			17
Other expenses		(34	)		182			(8	)		140
Total expenses		547			1,314			704			2,565
Earnings (loss) from discontinued operations before income taxes		230			(254	)		2,863			2,839
Income tax expense (benefit)		50			(124	)		403			329
Net earnings (loss) from discontinued operations, net of tax		180			(130	)		2,460			2,510
Net earnings attributable to noncontrolling interests		—			—			160			160
Net earnings (loss) from discontinued operations, attributable to Devon	$	180		$	(130	)	$	2,300		$	2,350

Prior to December 31, 2020, activity on the consolidated statement of comprehensive earnings and assets and liabilities on the consolidated balance sheet related to Devon’s Barnett Shale and Canadian operations were classified as discontinued operations. Under the terms of the Canadian and Barnett disposition agreements, Devon retained certain long-term obligations for firm transportation, office leases and potential income tax matters. Appropriate assets and liabilities related to these obligations have been recognized on Devon's consolidated balance sheet. Because these amounts will be settled over a period extending as far as 13 years in the future, these assets and liabilities have been reclassified as part of Devon's continuing operations as of December 31, 2020.

The following table presents the carrying amounts of the assets and liabilities associated with discontinued operations on the consolidated balance sheet as of December 31, 2019.

	As of December 31, 2019
	Barnett Shale		Canada		Total
Accounts receivable	$	38	$	1	$	39
Other current assets		5		2		7
Oil and gas property and equipment, based on successful efforts accounting, net		751		—		751
Other property and equipment, net		11		—		11
Goodwill		88		—		88
Other long-term assets		—		81		81
Total assets associated with discontinued operations	$	893	$	84	$	977

Accounts payable	$	15	$	4	$	19
Revenues and royalties payable		44		3		47
Other current liabilities		19		233		252
Asset retirement obligations		141		—		141
Other long-term liabilities		16		169		185
Total liabilities associated with discontinued operations	$	235	$	409	$	644