Equity Method Investments

12 Months Ended

Dec. 31, 2016

Equity Method Investments and Joint Ventures [Abstract]

Note 7. Equity Method Investments

Equity Method Investments Equity method investments are included in other noncurrent assets in the consolidated balance sheets, and our share of earnings is reported as income from equity method investees in the consolidated statements of operations. Our share of income taxes incurred directly by the equity method investees is reported in income from equity method investees and is not included in our income tax provision in our consolidated statements of operations. Investments accounted for under the equity method consist primarily of the following:


•	50% interest in CONE Gathering LLC (CONE Gathering), which owns and operates natural gas gathering facilities servicing our properties in the Marcellus Shale;


•	33.5% interest in CONE Midstream Partners, LP (CONE Midstream), a public master limited partnership, which constructs, owns and operates natural gas gathering and other midstream energy assets in support of our Marcellus Shale activities;


•	45% interest in Atlantic Methanol Production Company, LLC (AMPCO), which owns and operates a methanol plant and related facilities in Equatorial Guinea; and


•	28% interest in Alba Plant LLC (Alba Plant), which owns and operates a liquefied petroleum gas processing plant in Equatorial Guinea.

CONE Midstream Dropdown Transaction In fourth quarter 2016, CONE Midstream, completed its first acquisition of midstream assets (dropdown) from CONE Gathering since its initial public offering in 2014. CONE Gathering subsequently distributed $70 million cash and additional CONE Midstream common units to us. We currently own 7,110,638 common units and 14,581,560 subordinated units of CONE Midstream.

Equity method investments are as follows:



	December 31,
(millions)	2016		2015
Equity Method Investments
CONE Investments⁽¹⁾	$	172	$	214
AMPCO	120		120
Alba Plant	82		87
Other	26		32
Total Equity Method Investments	$	400	$	453


⁽¹⁾	CONE Investments include CONE Midstream and CONE Gathering.

Other At December 31, 2016, consolidated retained earnings included $95 million related to the undistributed earnings of equity method investees.

The carrying value of our AMPCO investment was $12 million higher than the underlying net assets of the investee at December 31, 2016. The difference is related to capitalized interest which is being amortized into earnings over the remaining useful life of the plant.

Summarized, 100% combined financial information for equity method investees is as follows:



	December 31,
(millions)	2016		2015
Balance Sheet Information
Current Assets	$	313	$	343
Noncurrent Assets	1,390		1,418
Current Liabilities	149		229
Noncurrent Liabilities	256		108



	Year Ended December 31,
(millions)	2016			2015			2014
Statements of Operations Information
Operating Revenues	$	667		$	645		$	1,142
Operating Expenses	355			393			405
Operating Income	312			252			737
Other (Income) Net	(7		)	(9		)	(9		)
Income Before Income Taxes	319			261			746
Income Tax Provision	60			46			172
Net Income	$	259		$	215		$	574