Restructuring Charges

Due to the ongoing lower than anticipated levels of exploration and production spending, we continue to reduce our overall cost structure and workforce to better align with current activity levels. The ongoing cost reduction plans which began in 2016 (the “2016 Plan”) included a workforce reduction and other cost reduction measures initiated across our geographic regions.

In connection with the 2016 Plan, we recognized restructuring charges of $31 million and $106 million in the second quarter and the first six months of 2017, respectively, which include termination (severance) charges of $22 million and $56 million, respectively, and other restructuring charges of $9 million and $38 million, respectively. The first six months of 2017 also includes restructuring related asset charges of $12 million. Other restructuring charges include contract termination costs, relocation and other associated costs.

Also in connection with the 2016 Plan, we recognized restructuring charges of $51 million and $128 million in the second quarter and the first six months of 2016, respectively, which include termination (severance) charges of $36 million and $108 million, respectively, and other restructuring charges of $15 million and $20 million, respectively. Other restructuring charges also include contract termination costs, relocation and other associated costs.

The following tables present the components of restructuring charges by segment for the second quarter and the first six months of 2017 and 2016.



	Three Months Ended June 30, 2017
					Total
(Dollars in millions)	Severance		Other		Severance and
2016 Plan	Charges		Charges		Other Charges
North America	$	2	$	6	$	8
MENA/Asia Pacific	4		1		5
Europe/SSA/Russia	6		2		8
Latin America	8		—		8
Subtotal	20		9		29
Land Drilling Rigs	1		—		1
Corporate and Research and Development	1		—		1
Total	$	22	$	9	$	31



	Three Months Ended June 30, 2016
					Total
(Dollars in millions)	Severance		Other		Severance and
2016 Plan	Charges		Charges		Other Charges
North America	$	5	$	10	$	15
MENA/Asia Pacific	9		2		11
Europe/SSA/Russia	8		2		10
Latin America	11		1		12
Subtotal	33		15		48
Land Drilling Rigs	1		—		1
Corporate and Research and Development	2		—		2
Total	$	36	$	15	$	51



	Six Months Ended June 30, 2017
					Total
(Dollars in millions)	Severance		Other		Severance and
2016 Plan	Charges		Charges		Other Charges
North America	$	2	$	21	$	23
MENA/Asia Pacific	8		1		9
Europe/SSA/Russia	8		21		29
Latin America	13		3		16
Subtotal	31		46		77
Land Drilling Rigs	2		—		2
Corporate and Research and Development	23		4		27
Total	$	56	$	50	$	106



	Six Months Ended June 30, 2016
					Total
(Dollars in millions)	Severance		Other		Severance and
2016 Plan	Charges		Charges		Other Charges
North America	$	24	$	15	$	39
MENA/Asia Pacific	18		2		20
Europe/SSA/Russia	23		2		25
Latin America	26		1		27
Subtotal	91		20		111
Land Drilling Rigs	5		—		5
Corporate and Research and Development	12		—		12
Total	$	108	$	20	$	128

The severance and other restructuring charges gave rise to certain liabilities, the components of which are summarized below, and largely relate to the severance accrued as part of earlier 2014 and 2015 Plans and the 2016 Plan and other executive severance matters that will be paid pursuant to the respective arrangements and statutory requirements.



	At June 30, 2017
	2016 Plan				2015 and 2014 Plans				Total
									Severance
	Severance		Other		Severance		Other		and Other
(Dollars in millions)	Liability		Liability		Liability		Liability		Liability
North America	$	1	$	20	$	—	$	—	$	21
MENA/Asia Pacific	5		2		—		—		7
Europe/SSA/Russia	3		10		—		7		20
Latin America	1		—		—		—		1
Subtotal	10		32		—		7		49
Land Drilling Rigs	—		—		—		—		—
Corporate and Research and Development	29		—		—		—		29
Total	$	39	$	32	$	—	$	7	$	78

The following table presents the restructuring liability activity for the first six months of 2017.



			Six Months Ended June 30, 2017
(Dollars in millions)	Accrued Balance at December 31, 2016		Charges		Cash Payments			Other			Accrued Balance at June 30, 2017
2016 Plan:
Severance liability	$	52	$	56	$	(65	)	$	(4	)	$	39
Other restructuring liability	22		38		(15		)	(13		)	32
2015 and 2014 Plan:
Severance liability	3		—		(3		)	—			—
Other restructuring liability	9		—		—			(2		)	7
Total severance and other restructuring liability	$	86	$	94	$	(83	)	$	(19	)	$	78