Percentage of Completion Contracts

3 Months Ended

Mar. 31, 2016

Contractors [Abstract]

Percentage of Completion Contracts

Percentage-of-Completion Contracts

In the first quarter of 2016, we recognized an estimated project loss of $52 million related to our Zubair long-term early production facility construction contract in Iraq accounted for under the percentage-of-completion method. Total estimated losses on these projects were $584 million at March 31, 2016.

As of March 31, 2016, our percentage-of-completion project estimates include $116 million of claims revenue and $32 million of back charges. During the first quarter of 2016, no additional claims revenue were included in our project estimates. Our costs in excess of billings as of March 31, 2016 were $2 million and are shown in the “Other Current Assets” line on the Consolidated Balance Sheet. We also have a variety of unapproved contract change orders or claims that are not included in our revenues as of March 31, 2016. The amounts associated with these contract change orders or claims are included in revenue only when they can be estimated reliably and their realization is reasonably assured.

In the first quarter of 2015, we recognized estimated project income of $42 millionrelated to our long-term early production facility construction contracts in Iraq accounted for under the percentage-of-completion method.Total estimated losses on these projects were $337 million at March 31, 2015. As of March 31, 2015, our percentage-of-completion project estimates include$137 million of claims revenue. Claims revenue of $53 million was recognized during the first quarter of 2015.