Divestiture of Gulf of Mexico Assets On February 15, 2018, we announced that we had signed a definitive agreement to sell our Gulf of Mexico assets, including all of our interests in producing properties and undeveloped acreage, for cash consideration of $480 million, along with the assumption, by the purchaser, of all abandonment obligations associated with the properties. As a result, we recorded impairment expense of $168 million during first quarter 2018.

In addition, a cumulative contingent payment of up to $100 million is payable to us in the period after the closing of the transaction, beginning third quarter 2018, through the end of 2022, determined quarterly, at a rate of $2 per barrel produced by these assets when the average purchase price for Light Louisiana Sweet (LLS) crude oil exceeds $63 per barrel, and if produced crude oil volumes exceed certain minimum thresholds. As of December 31, 2018, $3 million has been accrued related to the contingent payment.

Divestiture of 7.5% Interest in Tamar Field On March 14, 2018, we closed the sale of a 7.5% working interest in the Tamar field to Tamar Petroleum Ltd. (Tamar Petroleum), a publicly traded entity on the Tel Aviv Stock Exchange (TASE: TMRP). Total consideration included cash and 38.5 million shares of Tamar Petroleum that had a publicly traded value of $224 million. The transaction had an effective date of January 1, 2018 and, after consideration of closing adjustments and before consideration of taxes, we received $484 million of cash. Total consideration received from the sale was applied to the field's basis and resulted in the recognition of a pre-tax gain of $376 million. We incurred tax expense of $86 million in connection with the transaction.

The Tamar Petroleum shares were subject to certain temporary lock-up provisions and had no voting rights. Due to the lock-up provisions associated with the Tamar Petroleum shares, we initially attributed $190 million of fair value to the shares, or 15% lower than the publicly traded value on the TASE. These shares were accounted for at fair value and we recorded decreases in fair value of $27 million and dividend income of $31 million during 2018. These amounts are included in other non-operating (income) expense, net, in our consolidated statements of operations.

In fourth quarter 2018, we sold 38.5 million shares of Tamar Petroleum in over the counter transactions for pre-tax proceeds of $163 million, net of transaction expenses. Upon sale, voting rights were restored and granted to the third parties. The sales of the 7.5% working interest in the Tamar field and of the Tamar Petroleum shares are in accordance with the terms of the Israel Natural Gas Framework (Framework) that requires us to reduce our ownership interest in the Tamar field from 32.5% to 25% by year-end 2021.

Divestiture of Southwest Royalties In January 2018, we closed the sale of our investment in Southwest Royalties, Inc. (Southwest Royalties), a subsidiary of Clayton Williams Energy, Inc. (Clayton Williams Energy), which we acquired in the acquisition of Clayton Williams Energy (Clayton Williams Energy Acquisition) in 2017. We received proceeds of $60 million, resulting in no gain or loss recognition on the sale of these assets.

Divestiture of Marcellus Shale CONE Gathering In January 2018, we closed the sale of our 50% interest in CONE Gathering LLC (CONE Gathering) to CNX Resources Corporation. CONE Gathering owns the general partner of CNX Midstream Partners LP (CNX Midstream Partners, NYSE: CNXM). We received proceeds of $309 million in cash and recognized a pre-tax gain of $196 million.

After the sale, we held 21.7 million common units, representing a 34.1% limited partner interest, in CNX Midstream Partners. During 2018, we sold our 21.7 million common units, receiving net proceeds of approximately $387 million, and recognized a gain of $307 million. The investment was previously accounted for under the equity method of accounting.

DJ Acreage Exchange We closed a cashless acreage exchange in the DJ Basin receiving approximately 12,900 net undeveloped acres within core areas of our Mustang and Wells Ranch positions in exchange for approximately 12,300 net undeveloped acres in non-core areas of Mustang and Wells Ranch. No gain or loss was recognized.

Noble Midstream Partners Saddle Butte Acquisition On January 31, 2018, Noble Midstream Partners acquired a 54.4% in Black Diamond Gathering LLC (Black Diamond), an entity formed by Black Diamond Gathering Holdings LLC, a wholly-owned subsidiary of Noble Midstream Partners, and Greenfield Midstream, LLC (Greenfield), which completed the acquisition of Saddle Butte from Saddle Butte Pipeline II, LLC (Saddle Butte Acquisition). Saddle Butte owned a large-scale integrated gathering system, located in the DJ Basin, which we subsequently renamed the Black Diamond gathering system.

Consideration totaled $681 million, which included $663 million of cash and assumption of $18 million of liabilities. Greenfield funded approximately $343 million of the purchase price, which is reflected as a contribution from noncontrolling interest within our consolidated statement of equity, and Noble Midstream Partners funded the remainder. We consolidate Black Diamond as a VIE and reflect the third-party ownership within noncontrolling interest within our consolidated statement of equity.

This transaction was accounted for as a business combination using the acquisition method. The total purchase price was allocated to assets acquired and liabilities assumed based on the fair value at the acquisition date. We have recognized goodwill for the amount of the purchase price exceeding the fair value of the assets acquired. Allocated fair value included: $206 million to property, plant and equipment; $340 million to customer-related intangible assets (acquired customer contracts); and $110 million to implied goodwill. Noble Midstream Partners has completed the purchase price allocation related to this acquisition.

Other Acquisitions and Divestitures During 2018, we closed on the acquisition of other smaller US onshore properties for total cash consideration of $3 million. We also closed the sale of certain other smaller US onshore proved and unproved properties and received total cash consideration of $81 million, recording a gain of $4 million.

Subsequent Events In first quarter 2019, we closed the sale of certain proved and unproved non-core acreage totaling approximately 13,000 net acres in Reeves County, Texas. We received cash consideration of $132 million, recognizing no gain or loss on the sale. As of December 31, 2018, the assets and related liabilities associated with this acreage were considered held for sale and were recorded within other current assets and other current liabilities on our consolidated balance sheets.

In first quarter 2019, Noble Midstream Partners exercised and closed an option with EPIC Midstream Holdings, LP (EPIC) to acquire a 15% equity interest in the EPIC Y-Grade Pipeline. It also exercised an option to acquire a 30% equity interest in the EPIC Crude Oil Pipeline, for which closing is anticipated to occur later in first quarter 2019, subject to certain conditions precedent.

Clayton Williams Energy Acquisition On April 24, 2017, we completed the Clayton Williams Energy Acquisition. Clayton Williams Energy's results of operations since the acquisition date are included in our consolidated statement of operations. The acquisition was effected through the issuance of approximately 56 million shares of Noble Energy common stock with a fair value of approximately $1.9 billion and cash consideration of $637 million, for total consideration of approximately $2.5 billion, in exchange for all outstanding Clayton Williams Energy shares, including stock options, restricted stock awards and warrants.

The closing price of our stock on the New York Stock Exchange (NYSE) was $34.17 on April 24, 2017. In connection with the transaction, we borrowed $1.3 billion under our Revolving Credit Facility (defined below) to fund the cash portion of the acquisition consideration, redeem outstanding Clayton Williams Energy debt, pay associated make-whole premiums and pay related fees and expenses. See Note 9. Long-Term Debt.

The acquired assets included 71,000 highly contiguous net acres in the core of the Delaware Basin adjacent to our Reeves County holdings in Texas, and an additional 100,000 net acres in other areas of the United States. In addition, upon closing of the acquisition, approximately 64,000 net acres in Reeves County, Texas were dedicated to Noble Midstream Partners for infield crude oil, natural gas and produced water gathering.

In connection with the acquisition, we incurred acquisition-related costs of $100 million, including $64 million of severance, consulting, investment, advisory, legal and other merger-related fees and $36 million of noncash share-based compensation expense, all of which were expensed and are included in other operating expense, net in our consolidated statements of operations. In addition, we received approximately 720,000 shares of common stock from Clayton Williams Energy shareholders for the payment of withholding taxes due on the vesting of their restricted stock and options pursuant to the purchase and sale agreement, resulting in a $25 million increase in our treasury stock balance.

Purchase Price Allocation The transaction was accounted for as a business combination using the acquisition method. The following table represents the allocation of the total purchase price of Clayton Williams Energy to the assets acquired and the liabilities assumed based on the fair value at the acquisition date, with any excess of the purchase price over the estimated fair value of the identifiable net assets acquired recorded as goodwill.

The following table sets forth our purchase price allocation:



(millions, except per share amounts)
Fair Value of Common Stock Issued	$	1,851
Plus: Cash Consideration Paid to Clayton Williams Energy Stockholders	637
Total Purchase Price	$	2,488
Plus Liabilities Assumed by Noble Energy:
Accounts Payable	99
Other Current Liabilities	38
Long-Term Deferred Tax Liability	515
Long-Term Debt	595
Asset Retirement Obligations	63
Total Purchase Price Plus Liabilities Assumed	$	3,798

The fair values of Clayton Williams Energy's identifiable assets are as follows:



(millions)
Cash and Cash Equivalents	$	21
Other Current Assets	70
Oil and Gas Properties:
Proved Reserves	722
Undeveloped Leasehold Cost	1,571
Gathering and Processing Assets	48
Asset Retirement Costs	63
Other Property Plant and Equipment	12
Implied Goodwill ⁽¹⁾	1,291
Total Asset Value	$	3,798

In connection with the acquisition, we assumed, and then subsequently retired, all of Clayton Williams Energy's long-term debt at a cost to us of $595 million. The fair value measurements of long-term debt were estimated based on the early redemption prices and represent Level 1 inputs.

The fair value measurements of crude oil and natural gas properties and AROs are based on inputs that are not observable in the market and therefore represent Level 3 inputs. The fair values of crude oil and natural gas properties and AROs were measured using valuation techniques that convert expected future cash flows to a single discounted amount. Significant inputs to the valuation of crude oil and natural gas properties included estimates of: (i) proved, possible and probable reserves; (ii) production rates and related development timing; (iii) future operating and development costs; (iv) future commodity prices; and (v) a market-based weighted average cost of capital rate. These inputs required significant judgments and estimates by management at the time of the valuation and are the most sensitive and may be subject to change.

Results of Operations The results of operations attributable to Clayton Williams Energy are included in our consolidated statements of operations beginning on April 24, 2017. We generated revenues of $99 million and a pre-tax loss of $19 million from the Clayton Williams Energy assets during the period April 24, 2017 to December 31, 2017.

Pro Forma Financial Information The following pro forma condensed combined financial information was derived from the historical financial statements of Noble Energy and Clayton Williams Energy and gives effect to the acquisition as if it had occurred on January 1, 2016. The information below reflects pro forma adjustments based on available information and certain assumptions that we believe are reasonable, including (i) Noble Energy's common stock and equity awards issued to convert Clayton Williams Energy's outstanding shares of common stock and equity awards and conversion of warrants as of the closing date of the acquisition, (ii) depletion of Clayton Williams Energy's fair-valued proved crude oil and natural gas properties, and (iii) the estimated tax impacts of the pro forma adjustments.

Additionally, pro forma earnings for the year ended December 31, 2017 were adjusted to exclude acquisition-related costs of $100 million incurred by Noble Energy and $23 million incurred by Clayton Williams Energy. The pro forma results of operations do not include any cost savings or other synergies that we expect to realize from the Clayton Williams Energy Acquisition or any estimated costs that have been or will be incurred by us to integrate the Clayton Williams Energy assets. The pro forma condensed combined financial information has been included for comparative purposes and is not necessarily indicative of the results that might have actually occurred had the Clayton Williams Energy Acquisition taken place on January 1, 2016; furthermore, the financial information is not intended to be a projection of future results.



	Year Ended December 31,
(millions, except per share amounts)	2018 ⁽¹⁾			2017			2016
Revenues	$	4,986		$	4,304		$	3,651
Net Income (Loss) and Comprehensive Income (Loss) Attributable to Noble Energy	(66		)	(678		)	(1,082		)

Net Income (Loss) Attributable to Noble Energy per Common Share
Basic	$	(0.14	)	$	(1.39	)	$	(2.23	)
Diluted	$	(0.14	)	$	(1.39	)	$	(2.23	)

Marcellus Shale Upstream Divestiture On June 28, 2017, we closed the sale of all of our Marcellus Shale upstream assets, which were primarily natural gas properties. The sales price totaled $1.2 billion, and we received $1.0 billion of net cash proceeds, after consideration of customary closing adjustments. The sales price includes additional contingent consideration of up to $100 million structured as three separate payments of $33.3 million each. The contingent payments are in effect should the average annual price of the Appalachia Dominion, South Point index exceed $3.30 per MMBtu in the individual annual periods from 2018 through 2020. No amounts have been accrued related to the contingent consideration. Proceeds from the transaction were used to repay borrowings resulting from the Clayton Williams Energy Acquisition. See Note 9. Long-Term Debt.

For the year ended December 31, 2017, we recognized a loss on divestiture of $2.3 billion, or $1.5 billion after-tax. The aggregate net book value of the properties sold was approximately $3.4 billion, which included approximately $883 million of undeveloped leasehold cost.

Noble Midstream Partners Asset Contribution On June 26, 2017, Noble Midstream Partners acquired an additional 15% limited partner interest in Blanco River DevCo LP (Blanco River DevCo), increasing its ownership to 40% of the Blanco River DevCo LP, and acquired the remaining 20% limited partner interest in Colorado River DevCo LP (Colorado River DevCo) from us for $270 million.

Blanco River DevCo holds Noble Midstream Partners’ Delaware Basin in-field gathering dedications for crude oil and produced water gathering services on approximately 111,000 net acres, with substantially all of the acreage also dedicated for natural gas gathering. Colorado River DevCo provides services across our development areas in the DJ Basin, including crude oil and natural gas gathering and water services in the Wells Ranch area and crude oil gathering in the East Pony area.

Noble Midstream Partners Advantage Joint Venture On April 3, 2017, Noble Midstream Partners and Plains Pipeline, L.P., a wholly owned subsidiary of Plains All American Pipeline, L.P., acquired Advantage Pipeline, L.L.C. (Advantage Pipeline) for $133 million through a newly formed 50/50 joint venture (Advantage Joint Venture). Noble Midstream Partners contributed approximately $67 million of cash to the Advantage Joint Venture, funded by available cash on hand and the Noble Midstream Services Revolving Credit Facility. The Advantage Joint Venture is accounted for under the equity method and is included within our Midstream segment. See Note 15. Equity Method Investments.

Noble Midstream Partners serves as operator of the Advantage Pipeline System, which includes a 70-mile crude oil pipeline in the Delaware Basin from Reeves County, Texas to Crane County, Texas with 150 MBbls per day of shipping capacity and 490 MBbls of storage capacity.

Other Acquisitions and Divestitures During 2017, we closed on the acquisition of other smaller US onshore properties for total cash consideration of $26 million. We also closed the sale of certain other smaller US onshore and international properties and received total cash consideration of $39 million, recording a loss of $6 million.

Termination of Marcellus Shale JDA In fourth quarter 2016, we and CONSOL Energy Inc. (CONSOL) agreed to terminate our 50-50 Joint Development Agreement (JDA) in the Marcellus Shale. In connection with the terminated JDA, we executed and closed an exchange agreement whereby we and CONSOL each transferred all of our interest in a portion of co-owned properties to one another. In addition to the acreage and production realignment between the two companies, we remitted a cash payment of approximately $213 million to CONSOL at closing. Terminating the JDA resulted in the elimination of the remaining outstanding carried cost obligation due from us. No gain or loss was recognized on the exchange.

DJ Basin Acreage Exchange We closed a cashless acreage exchange in the DJ Basin receiving approximately 11,700 net acres within our Wells Ranch development area in exchange for approximately 13,500 net acres primarily from our Bronco area. No gain or loss was recognized.