GOODWILL AND INTANGIBLES

Goodwill

Goodwill is tested for impairment on an annual basis and when events or changes in circumstances indicate the fair value of a reporting unit with goodwill has been reduced below the carrying value of the net assets of the reporting unit. In 2018 and 2017, our annual testing did not indicate any impairment of goodwill.

The changes in the carrying amount of goodwill for 2017 and 2018 were as follows:



(In millions)	Refining & Marketing			Retail			Midstream		Total
Balance at January 1, 2017	$	519		$	792		$	2,276	$	3,587
Disposition	—			(1		)	—		(1		)
Balance at December 31, 2017	$	519		$	791		$	2,276	$	3,586
Acquisitions	4,717			4,050			7,831		16,598
Transfer of assets related to dropdowns	(216		)	—			216		—
Balance at December 31, 2018	$	5,020		$	4,841		$	10,323	$	20,184

The 2018 increase in goodwill resulted mainly from the acquisition of Andeavor. The goodwill represents the value expected to be created by optimization of crude supply, a nationwide retail and marketing platform, diversification of our refining and midstream footprints and optimization of information systems and business processes. As discussed in Note 5, this goodwill is based on our preliminary determination of the fair value of assets acquired and liabilities assumed in the Andeavor acquisition. We will complete a final determination of the fair value of certain assets and liabilities and an allocation of the resulting goodwill to our reporting units within one year from the acquisition.

Intangible Assets

Our finite-lived intangible assets as of December 31, 2018 and 2017 are as shown below. The increases in 2018 reflect preliminary estimates for customer contracts and relationships as well as brand rights and tradenames acquired in the the Andeavor acquisition.



	December 31, 2018						December 31, 2017
(In millions)	Gross		Accumulated Amortization		Net		Gross		Accumulated Amortization		Net
Customer contracts and relationships	$	3,184	$	261	$	2,923	$	654	$	139	$	515
Brand rights and tradenames	208		33		175		25		24		1
Royalty agreements	129		70		59		129		63		66
Other	190		33		157		84		35		49
Total	$	3,711	$	397	$	3,314	$	892	$	261	$	631

At December 31, 2018 and 2017, we had indefinite-lived intangible assets of $94 million and $95 million, respectively, which are primarily emission allowance credits and trademarks.

Amortization expense for 2018 and 2017 was $134 million and $52 million, respectively. Estimated future amortization expense related to the intangible assets at December 31, 2018 is as follows:



(In millions)
2019	$	387
2020	385
2021	379
2022	378
2023	361