Income Taxes (Tables)

12 Months Ended

Dec. 31, 2019

Components of Income Before Income Taxes Table

Components of (loss) income from operations before income taxes are as follows:



	Year Ended December 31,
(millions)	2019			2018			2017
Domestic	$	(2,222	)	$	(953	)	$	(2,831	)
Foreign	446			1,093			640
Total	$	(1,776	)	$	140		$	(2,191	)

Components of Income Tax Provision Table

The income tax (benefit) provision consists of the following:



	Year Ended December 31,
(millions, except percentages)	2019			2018			2017
Current Taxes
Federal	$	1		$	22		$	(11	)
State	3			2			1
Foreign	81			172			96
Total Current	$	85		$	196		$	86
Deferred Taxes
Federal	$	(413	)	$	(123	)	$	(1,258	)
State	(25		)	(7		)	(8		)
Foreign	10			60			39
Total Deferred	$	(428	)	$	(70	)	$	(1,227	)
Total Income Tax (Benefit) Provision Attributable to Noble Energy	$	(343	)	$	126		$	(1,141	)
Effective Tax Rate	19.3		%	90.0		%	52.1		%

Tax Rate Reconciliation Table

A reconciliation of the federal statutory tax rate to the ETR is as follows:



	Year Ended December 31,
(percentages)	2019		2018		2017
Federal Statutory Rate	21.0	%	21.0	%	35.0	%
Effect of
Goodwill Impairment	—		192.5		—
Change in Valuation Allowance	(0.6	)	(170.2	)	(17.4	)
US and Foreign Statutory Rate Change	—		80.7		23.5
Accumulated Undistributed Foreign Earnings	—		—		11.0
Transition Tax	—		—		(4.8	)
Difference Between US and Foreign Rates	(0.6	)	17.9		1.8
Earnings of Equity Method Investments	0.7		(20.1	)	1.9
Noncontrolling Interests	0.9		(12.1	)	1.1
State Taxes	1.1		0.9		0.3
Foreign Exploration Loss	—		(35.6	)	—
Global Intangible Low-Taxed Income (GILTI)	(0.8	)	24.2		—
Return to Provision	—		(17.1	)	(0.1	)
Audit Settlement	—		5.1		0.1
Oil Profits Tax - Israel	(0.1	)	3.3		(0.1	)
Other, Net	(2.3	)	(0.5	)	(0.2	)
Effective Rate	19.3	%	90.0	%	52.1	%

There were no material items impacting our 2019 ETR as compared to the federal statutory rate of 21%. Our 2018 ETR included a significant deferred tax benefit, discussed below, recorded as a result of the intent of the US Department of the Treasury (Treasury) and Internal Revenue Service (IRS) to issue additional regulatory guidance associated with the Tax Cuts and Jobs Act (Tax Reform Legislation) and the transition tax. In addition, the 2018 ETR was impacted by low earnings, goodwill impairment with no tax benefit, deferred tax expense of $34 million related to GILTI, discussed below, and a deferred tax benefit of $50 million associated with a write-off of foreign exploration losses. Our 2017 ETR was driven by the deferred tax benefit related to the Tax Reform Legislation, as we revalued the ending deferred tax liability at the reduced future tax rate.

Deferred Tax Assets and Liabilities

Deferred tax assets and liabilities resulted from the following:



	December 31,
(millions)	2019			2018
Deferred Tax Assets
Loss Carryforwards ⁽¹⁾	$	656		$	589
Employee Compensation and Benefits	92			92
Mark to Market of Commodity Derivative Instruments	11			(27		)
Foreign Tax Credits	133			138
Other	126			157
Total Deferred Tax Assets	$	1,018		$	949
Valuation Allowance - Foreign Loss Carryforwards and Foreign Tax Credits	(327		)	(320		)
Net Deferred Tax Assets	$	691		$	629
Deferred Tax Liabilities
Property, Plant and Equipment, Principally Due to Differences in Depreciation, Amortization, Lease Impairment and Abandonments	(1,338		)	(1,669		)
Total Deferred Tax Liability	$	(1,338	)	$	(1,669	)
Net Deferred Tax Liability	$	(647	)	$	(1,040	)


⁽¹⁾	At December 31, 2019, $459 million related to domestic tax (state and federal) and $197 million related to foreign tax.

Net deferred tax assets and liabilities were classified in the consolidated balance sheets as follows:



	December 31,
(millions)	2019			2018
Deferred Income Tax Asset - Noncurrent	$	15		$	21
Deferred Income Tax Liability - Noncurrent	(662		)	(1,061		)
Net Deferred Tax Liability	$	(647	)	$	(1,040	)