Segment Information

3 Months Ended

Mar. 31, 2015

Segment Information [Abstract]

Segment Information

(13) SEGMENT INFORMATION

The Company’s reportable business segments have been identified based on the differences in products or services provided. Revenues for the E&P segment are derived from the production and sale of natural gas and liquids. The Midstream Services segment generates revenue through the marketing of both Company and third-party produced natural gas volumes and through gathering fees associated with the transportation of natural gas to market.

Summarized financial information for the Company’s reportable segments is shown in the following table. The accounting policies of the segments are the same as those described in Note 1 of the Notes to Consolidated Financial Statements included in Item 8 of the 2014 Annual Report. Management evaluates the performance of its segments based on operating income, defined as operating revenues less operating costs. Income before income taxes, for the purpose of reconciling the operating income amount shown below to consolidated income before income taxes, is the sum of operating income, interest expense, and other income (loss). The “Other” column includes items not related to the Company’s reportable segments including real estate and corporate items.

	Exploration
	and		Midstream
	Production		Services		Other			Total
	(in millions)
Three months ended March 31, 2015:
Revenues from external customers	$	660	$	273	$	–		$	933
Intersegment revenues		(5)		665		1			661
Operating income (loss)		78		88		(1)			165
Other loss		(1)		–		–			(1)
Gain (loss) on derivatives		15		–		(1)			14
Depreciation, depletion and amortization		278		15		–			293
Interest expense (1)		45		7		(1)			51
Provision for income taxes (1)		18		31		–			49
Assets		13,703		1,616		268	(2)		15,587
Capital investments (3)		1,030		138		3			1,171
Three months ended March 31, 2014:
Revenues from external customers	$	796	$	317	$	–		$	1,113
Intersegment revenues		6		913		–			919
Operating income		352		83		–			435
Other income (loss), net		2		–		(1)			1
Loss on derivatives		(100)		–		–			(100)
Depreciation, depletion and amortization		211		14		–			225
Interest expense (1)		9		4		–			13
Provision for income taxes (1)		98		31		–			129
Assets		6,621		1,544		258	(2)		8,423
Capital investments (3)		499		39		4			542

⁽¹⁾ Interest expense and the provision for income taxes by segment are allocated as they are incurred at the corporate level.

⁽²⁾ Other assets represent corporate assets not allocated to segments and assets for non reportable segments.

⁽³⁾ Capital investments includes an immaterial increase and $6 million increase for the three month periods ended March 31, 2015 and 2014, respectively, relating to the change in accrued expenditures between periods.  E&P capital for the three months ended March 31, 2015 includes approximately $534 million related to the WPX and Statoil Property Acquisitions. Midstream capital for the three months ended March 31, 2015 includes approximately $119 million of firm transport associated with the WPX Property Acquisition.

Included in intersegment revenues of the Midstream Services segment are $576 million and $824 million for the three months ended March 31, 2015 and 2014, respectively, for marketing of the Company’s E&P sales. Corporate assets include cash and cash equivalents, furniture and fixtures, prepaid debt and other costs. Corporate general and administrative costs, depreciation expense and taxes other than income are allocated to the segments. At March 31, 2015, E&P segment assets included $71 million and at March 31, 2014, E&P segment assets included $80 million related to the Company’s activities in Canada.