EMPLOYEE BENEFIT PLANS

Pension Plans

In October 2014, Energen’s Board of Directors elected to freeze and terminate its qualified defined benefit pension plan. A plan amendment adopted in October 2014 closed the plan to new entrants, effective November 1, 2014, and froze benefit accruals effective December 31, 2014. Energen terminated the plan on January 31, 2015 and distributed benefits in December 2015. The Pension Benefit Guaranty Corporation (PBGC) is conducting an audit of the termination of the pension plan to ensure that Energen properly calculated and distributed benefits in accordance with plan provisions and in compliance with the appropriate laws and regulations administered by the PBGC.

Energen’s non-qualified supplemental retirement plans were terminated effective December 31, 2014. Distributions under the plans were partially made in the first quarter of 2015 with the remainder of approximately $14.5 million paid in the first quarter of 2016. The Company expects to make no additional benefit payments with respect to the termination of the non-qualified supplemental retirement plans. Certain annuities associated with our non-qualified supplemental retirement plans remain of approximately $1.0 million and $1.1 million and are included in other current liabilities and other long-term liabilities on the consolidated balance sheets at June 30, 2017 and December 31, 2016, respectively. In the first quarter of 2016, Energen incurred a settlement charge of $3.3 million for the payment of lump sums from the non-qualified supplemental retirement plans.

Postretirement Benefit Plans

Energen provides certain postretirement health care and life insurance benefits for all employees hired prior to January 1, 2010. These postretirement healthcare and life insurance benefits are available upon reaching normal retirement age while working for Energen. The components of net periodic postretirement benefit income for Energen’s postretirement benefit plan were as follows:



	Three months ended June 30,						Six months ended June 30,
(in thousands)	2017			2016			2017			2016
Components of net periodic benefit cost:
Service cost	$	18		$	24		$	35		$	47
Interest cost	57			52			113			118
Expected long-term return on assets	(62		)	(69		)	(124		)	(180		)
Prior service cost amortization	(114		)	(113		)	(227		)	(238		)
Actuarial loss amortization	2			—			5			—
Settlement charge	—			—			—			45
Curtailment gain	—			—			—			(816		)
Net periodic income	$	(99	)	$	(106	)	$	(198	)	$	(1,024	)

There are no required contributions to the postretirement benefit plan during 2017. In the first quarter of 2016, Energen incurred a curtailment gain of $0.8 million in connection with the reduction in workforce.