4. Capitalized Exploratory Well Costs

The following table discloses the net changes in capitalized exploratory well costs pending determination of proved reserves during the six months ended June 30, 2016 (in millions):

Balance at January 1, 2016	$	1,415
Additions to capitalized exploratory well costs pending the determination of proved reserves		93
Capitalized exploratory well costs charged to expense		(114	)
Balance at June 30, 2016	$	1,394

Exploratory wells costs charged to expense in the six months ended June 30, 2016 totaled $218 million, which includes $104 million of exploratory well costs incurred in 2016 that are not reflected in the table above. We expensed the non-operated Melmar exploration well in the Gulf of Mexico, where noncommercial quantities of hydrocarbons were encountered. In addition, at the non-operated Sicily exploration project in the Gulf of Mexico where hydrocarbons were encountered, we decided in the second quarter not to pursue the project due to the current price environment and the limited time remaining on the leases. The cost of both wells drilled at Sicily were expensed in the quarter.

Capitalized exploratory well costs capitalized for greater than one year following completion of drilling were $1,150 million at June 30, 2016 and primarily related to:

Australia: Approximately 70% of the capitalized well costs in excess of one year relates to our Equus project on license WA-390-P, offshore Western Australia, where development planning and commercial activities for our natural gas discoveries are ongoing. In December 2014, we executed a non-binding letter of intent with the North West Shelf (NWS), a third-party joint venture with existing natural gas processing and liquefaction facilities. In the second quarter of 2016, we continued a joint front-end engineering study with NWS and discussions with potential long-term purchasers of liquefied natural gas. Successful execution of binding agreements with NWS is necessary before we can execute a gas sales agreement and sanction development of the project. In addition, in March 2016, we were awarded a retention lease through 2021 covering certain areas within the WA-390-P License which include our Equus discoveries. At our adjacent WA-474-P license which could become part of the Equus project, we completed drilling of an exploration commitment well in the second quarter of 2016 and encountered hydrocarbons. The associated well costs have been capitalized pending determination of proved reserves.

Ghana: Approximately 20% of the capitalized well costs in excess of one year relates to offshore Ghana. Since 2014, we have completed three appraisal wells and continue to progress subsurface evaluation and development planning. The government of Côte d’Ivoire has challenged the maritime border between it and the country of Ghana, which includes a portion of our Deepwater Tano/Cape Three Points license. We are unable to proceed with development of this license until there is a resolution of this matter, which may also impact our ability to develop the license. The International Tribunal for Law of the Sea is expected to render a final ruling on the maritime border dispute in 2017. Under terms of our license and subject to resolution of the border dispute, we have declared commerciality for four discoveries, including the Pecan Field in March 2016 which would be the primary development hub for the block. We are continuing to work with the government on how best to progress work on the block given the maritime border dispute.

Guyana: Approximately 10% of the capitalized well costs in excess of one year relates to the Stabroek Block, offshore Guyana, where the operator, Esso Exploration and Production Guyana Limited, announced a significant oil discovery at the Liza #1 well in the second quarter of 2015. During 2016, the operator drilled the Liza #2 well which also encountered hydrocarbons, continued pre-development activities for Liza, and completed a 17,000 square kilometer 3D seismic shoot on the Stabroek Block. The operator is currently drilling the Skipjack exploration well, which is a separate prospect 25 miles northwest of the Liza discovery.