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Employee Benefit Plans
 12 Months Ended
Dec. 31, 2022
Retirement Benefits [Abstract]  
Employee Benefit Plans Employee Benefit Plans
Postretirement Benefits
The Company provides certain health care benefits for legacy retired employees of Cabot Oil & Gas Corporation, including their spouses, eligible dependents and surviving spouses (retirees). These benefits are commonly called postretirement benefits. The health care plans are contributory, with participants’ contributions adjusted annually. Most legacy employees of Cabot Oil & Gas Corporation become eligible for these benefits if they meet certain age and service requirements at retirement.
The Company provided postretirement benefits to 320 retirees and their dependents at the end of 2022 and 364 retirees and their dependents at the end of 2021.
During 2022, the Company amended its postretirement plans to phase out all postretirement benefits and freeze future participation in the plan. The plan amendment provides that certain employees will be grandfathered and remain eligible for future participation in the pre-65 plan upon their retirement based on certain age and years of service criteria, while the post-65 benefit for all plan participants that reach the age of 65 after December 31, 2022, including current retirees participating the pre-65 plan, will be eliminated. Existing retirees participating in both the pre-65 and post-65 plans prior to December 31, 2022 will continue to receive benefits under the plan until the age of 65 in the case of the pre-65 participants, or voluntary termination of benefits or by death in the case of post-65 participants.

Obligations and Funded Status
The funded status represents the difference between the accumulated benefit obligation of the Company’s postretirement plan and the fair value of plan assets at December 31. The postretirement plan does not have any plan assets; therefore, the unfunded status is equal to the amount of the December 31 accumulated benefit obligation.
The change in the Company’s postretirement benefit obligation is as follows:
 Year Ended December 31,
(In millions)202220212020
Change in Benefit Obligation   
Benefit obligation at beginning of period
$35 $33 $34 
Service cost2 2 2 
Interest cost1 1 1 
Actuarial (gain) loss(15)1 (2)
Benefits paid(2)(2)(2)
Plan amendments(3)— — 
Benefit obligation at end of period
$18 $35 $33 
Change in Plan Assets   
Fair value of plan assets at end of period
— — — 
Funded status at end of period
$(18)$(35)$(33)
Amounts recognized in balance sheet
Current liabilities$1 $2 $2 
Non-current liabilities17 33 31 
Net amount$18 $35 $33 
Amounts recognized in accumulated other comprehensive income (loss)
Net actuarial (gain) loss$(15)$— $— 
Prior service credit(3)(2)(3)
Total$(18)$(2)$(3)
Components of Net Periodic Benefit Cost and Other Amounts Recognized in Other Comprehensive Income (Loss)
 Year Ended December 31,
(In millions)202220212020
Components of Net Periodic Postretirement Benefit Cost   
Service cost$2 $2 $2 
Interest cost1 1 1 
Amortization of prior service credit
(1)(1)(1)
Net periodic postretirement cost$2 $2 $2 
Recognized curtailment gain(1)— — 
Total post retirement cost $1 $2 $2 
Other Changes in Benefit Obligations Recognized in Other Comprehensive Income    
Net gain$(15)$— $(2)
Prior service credit
(1)— — 
Amortization of prior service credit
1 1 1 
Total recognized in other comprehensive income(15)1 (1)
Total recognized in net periodic benefit cost (income) and other comprehensive income$(14)$3 $1 
Assumptions
Assumptions used to determine projected postretirement benefit obligations and postretirement costs are as follows:
 December 31,
 202220212020
Discount rate(1)
5.55 %2.85 %2.65 %
Health care cost trend rate for medical benefits assumed for next year (pre-65)8.00 %6.50 %6.75 %
Health care cost trend rate for medical benefits assumed for next year (post-65)4.50 %4.75 %5.00 %
Ultimate trend rate (pre-65)4.50 %4.50 %4.50 %
Ultimate trend rate (post-65)4.50 %4.50 %4.50 %
Year that the rate reaches the ultimate trend rate (pre-65)203020302030
Year that the rate reaches the ultimate trend rate (post-65)202320232023
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(1)Represents the year end rates used to determine the projected benefit obligation. To compute postretirement cost in 2022, 2021 and 2020, the beginning of year discount rates of 2.85 percent, 2.65 percent and 3.50 percent, respectively, were used.
Coverage provided to participants age 65 and older is under a fully-insured arrangement. The Company subsidy is limited to 60 percent of the expected annual fully-insured premium for participants age 65 and older. For all participants under age 65, the Company subsidy for all retiree medical and prescription drug benefits, beginning January 1, 2006, was limited to an aggregate annual amount not to exceed $648,000. This limit increases by three percent annually thereafter.
Cash Flows
Contributions.   The Company expects to contribute approximately $1 million to the postretirement benefit plan in 2023.
Estimated Future Benefit Payments.   The following estimated benefit payments under the Company’s postretirement plans, which reflect expected future service, are expected to be paid as follows:
(In millions) 
2023$1 
20241 
20251 
20261 
20271 
Years 2028 - 20326 
Retirement Savings Plan
The Company has a Retirement Savings Plan (“RSP”), which is a defined contribution plan. The Company matches a portion of employees’ contributions in cash. Participation in the RSP is voluntary and all employees of the Company are eligible to participate. The Company matches employee contributions dollar-for-dollar, up to the maximum Internal Revenue Service (“IRS”) limit, on the first six percent of an employee’s pretax earnings. The RSP also provides for discretionary contributions in an amount equal to 10 percent of an eligible plan participant’s salary and bonus.
In connection with the Merger, the Company assumed the Cimarex Energy Co. 401(k) Plan (the “401(k) Plan”) with respect to Cimarex employees. The Company maintained this plan throughout the integration process and terminated this plan effective December 31, 2022, with all legacy Cimarex employees becoming eligible for the Company’s RSP effective January 1, 2023.
During the years ended December 31, 2022, 2021 and 2020, the Company made aggregate contributions to the RSP and 401(k) Plan of $12 million, $7 million and $6 million, respectively, which are included in general and administrative expense in the Consolidated Statement of Operations. The Company’s common stock was an investment option within the RSP and the 401(k) Plan. Effective December 31, 2022, investment in the Company’s common stock is no longer an option.
Deferred Compensation Plans
The Company has deferred compensation plans which are available to officers and select employees and act as a supplement to the RSP. The Internal Revenue Code does not cap the amount of compensation that may be taken into account for purposes of determining contributions to the deferred compensation plans and does not impose limitations on the amount of contributions to the deferred compensation plans. At the present time, the Company anticipates making a contribution to the deferred compensation plans on behalf of a participant in the event that Internal Revenue Code limitations cause a participant to receive less than the Company contribution under the RSP.
The assets of the deferred compensation plans are held in a rabbi trust and are subject to additional risk of loss in the event of bankruptcy or insolvency of the Company.
Under the deferred compensation plans, the participants direct the deemed investment of amounts credited to their accounts. The trust assets are invested in either mutual funds that cover the investment spectrum from equity to money market, or may include holdings of the Company’s common stock, which is funded by the issuance of shares to the trust. The mutual funds are publicly traded and have market prices that are readily available. The Company’s common stock is no longer an investment option in the deferred compensation plan effective December 31, 2022. All outstanding Coterra shares previously held in the trust will be liquidated in March 2023. Shares of the Company’s stock currently held in the deferred compensation plan represent vested performance share awards that were previously deferred into the rabbi trust. Settlement payments are made to participants in cash, either in a lump sum or in periodic installments. The market value of the trust assets, excluding the Company’s common stock, was $43 million and $47 million at December 31, 2022 and 2021, respectively, and is included in other assets in the Consolidated Balance Sheet. Related liabilities, including the Company’s common stock, totaled $55 million and $56 million at December 31, 2022 and 2021, respectively, and are included in other liabilities in the Consolidated Balance Sheet. Increases (decreases) in the fair value of the Company’s common stock are recognized as compensation expense (benefit) in general and administrative expense in the Consolidated Statement of Operations. There is no impact on earnings or earnings per share from the changes in market value of the other deferred compensation plan assets because the changes in market value of the trust assets are offset completely by changes in the value of the liability, which represents trust assets belonging to plan participants.
As of December 31, 2022 and 2021, 495,774 shares of the Company’s common stock were held in the rabbi trust, respectively. These shares were recorded at the market value on the date of deferral, which totaled $5 million and is included in additional paid-in capital in stockholders’ equity in the Consolidated Balance Sheet.
On September 30, 2021, certain executives of the Company entered into letter agreements whereby, in exchange for the cancellation of their rights under their change-in-control agreements and the non-competition and non-solicitation provisions contained in the letter agreements, each such executive would receive a contribution into his or her deferred compensation account at the effective time of the Merger. On October 1, 2021, the Company made deferred contribution payments totaling approximately $19 million into such executives’ deferred compensation accounts. All of such contributions are fully vested.
In connection with the Merger, the Company assumed the Cimarex deferred compensation plan. The market value of the trust assets and related liabilities was $27 million at the effective date of the Merger, October 1, 2021. Subsequent to the completion of the Merger, in October 2021, the Company distributed $27 million to the plan participants as a result of the change-in-control provision under the plan.
The Company made contributions to the deferred compensation plans of $1 million, $20 million and $1 million in 2022, 2021 and 2020, respectively, which are included in general and administrative expense in the Consolidated Statement of Operations.