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Impairment
12 Months Ended
Dec. 31, 2016
Asset Impairment Charges [Abstract]  
Impairment

6.  Impairment

In 2016, we recorded a pre-tax impairment charge of $67 million ($21 million after income taxes and noncontrolling interest) to impair older specification rail cars in our Midstream segment based on estimated salvage values, which approximate fair value and represent a Level 3 fair value measurement as defined under accounting standards.

In 2015, we recorded pre-tax goodwill impairment charges totaling $1,483 million ($1,483 million after income taxes).  As a result of establishing the Bakken Midstream operating segment in the second quarter of 2015, (see Note 5, Goodwill), we performed impairment tests on the Offshore and Onshore reporting units prior to creation of the Bakken Midstream segment in accordance with accounting standards for goodwill.  No impairment resulted from this assessment.  In addition, we performed separate impairment tests at June 30, 2015, on the allocated goodwill to the Bakken Midstream segment and Onshore reporting unit of the E&P segment following the creation of the Bakken Midstream segment.  No impairment existed for the Bakken Midstream segment, but goodwill allocated to the Onshore reporting unit of $385 million did not pass the impairment test, and as a result was reduced to its implied fair value of zero based on a hypothetical purchase price allocation as stipulated in the accounting standards.  In addition, as part of the further deterioration in crude oil prices in the fourth quarter of 2015, we determined goodwill allocated to the Offshore reporting unit of $1,098 million did not pass the impairment test, and as a result was reduced to its implied fair value of zero based on a hypothetical purchase price allocation as stipulated in the accounting standards.  Fair value of our Onshore and Offshore reporting units were determined using multiple valuation techniques, including projected discounted cash flows of producing assets and known development projects.  The determination of projected discounted cash flows depended on estimates of oil and gas reserves, future prices, operating costs, capital expenditures, discount rate and timing of future net cash flows.  We also considered the relative market valuation of similar peer companies using market multiples, and other observable market data, in assessing fair value of each reporting unit.  The valuation methodologies used represent Level 3 measurements.  

As a result of the prevailing low crude oil price in 2015, we also recognized an impairment charge of $133 million pre-tax ($83 million after income taxes) relating to our legacy conventional North Dakota assets based on projected discounted cash flows, using similar Level 3 inputs to those discussed above.