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 and is continuing through 2017 (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 $34 million and $140 million in the third quarter and the first nine months of 2017, respectively, which include termination (severance) charges of $15 million and $71 million, respectively, and other restructuring charges of $19 million and $57 million, respectively. Other restructuring charges include contract termination costs, relocation and other associated costs. The first nine months of 2017 also includes restructuring related asset charges of $12 million.

Also in connection with the 2016 Plan, we recognized restructuring charges of $22 million and $150 million in the third quarter and the first nine months of 2016, respectively, which include termination (severance) charges of $18 million and $126 million, respectively, and other restructuring charges of $4 million and $24 million, respectively. Other restructuring charges include contract termination costs, relocation and other associated costs.

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



	Three Months Ended September 30, 2017
					Total
(Dollars in millions)	Severance		Other		Severance and
2016 Plan	Charges		Charges		Other Charges
North America	$	1	$	—	$	1
MENA/Asia Pacific	4		16		20
Europe/SSA/Russia	2		—		2
Latin America	7		2		9
Subtotal	14		18		32
Land Drilling Rigs	—		—		—
Corporate and Research and Development	1		1		2
Total	$	15	$	19	$	34



	Three Months Ended September 30, 2016
						Total
(Dollars in millions)	Severance			Other		Severance and
2016 Plan	Charges			Charges		Other Charges
North America	$	5		$	—	$	5
MENA/Asia Pacific	4			1		5
Europe/SSA/Russia	(2		)	2		—
Latin America	9			1		10
Subtotal	16			4		20
Land Drilling Rigs	—			—		—
Corporate and Research and Development	2			—		2
Total	$	18		$	4	$	22



	Nine Months Ended September 30, 2017
					Total
(Dollars in millions)	Severance		Other		Severance and
2016 Plan	Charges		Charges		Other Charges
North America	$	3	$	21	$	24
MENA/Asia Pacific	12		17		29
Europe/SSA/Russia	10		21		31
Latin America	20		5		25
Subtotal	45		64		109
Land Drilling Rigs	2		—		2
Corporate and Research and Development	24		5		29
Total	$	71	$	69	$	140



	Nine Months Ended September 30, 2016
					Total
(Dollars in millions)	Severance		Other		Severance and
2016 Plan	Charges		Charges		Other Charges
North America	$	29	$	15	$	44
MENA/Asia Pacific	22		3		25
Europe/SSA/Russia	21		4		25
Latin America	35		2		37
Subtotal	107		24		131
Land Drilling Rigs	5		—		5
Corporate and Research and Development	14		—		14
Total	$	126	$	24	$	150

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, the 2016 Plan that will be paid pursuant to the respective arrangements and statutory requirements.



	At September 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	$	17	$	—	$	—	$	18
MENA/Asia Pacific	4		11		—		—		15
Europe/SSA/Russia	2		9		—		5		16
Latin America	—		—		—		—		—
Subtotal	7		37		—		5		49
Land Drilling Rigs	—		—		—		—		—
Corporate and Research and Development	9		—		—		—		9
Total	$	16	$	37	$	—	$	5	$	58

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



			Nine Months Ended September 30, 2017
(Dollars in millions)	Accrued Balance at December 31, 2016		Charges		Cash Payments			Other			Accrued Balance at September 30, 2017
2016 Plan:
Severance liability	$	52	$	71	$	(104	)	$	(3	)	$	16
Other restructuring liability	22		57		(21		)	(21		)	37
2015 and 2014 Plan:
Severance liability	3		—		(3		)	—			—
Other restructuring liability	9		—		(1		)	(3		)	5
Total severance and other restructuring liability	$	86	$	128	$	(129	)	$	(27	)	$	58