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(Mark One) | ||
þ
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |
For the fiscal year ended December 31, 2009 | ||
or
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||
o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Delaware | 73-1567067 | |
(State of other jurisdiction of incorporation or organization) | (I.R.S. Employer identification No.) | |
20 North Broadway, Oklahoma City, Oklahoma | 73102-8260 | |
(Address of principal executive offices) | (Zip code) |
Title of each class
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Name of each exchange on which registered
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Common stock, par value $0.10 per share
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The New York Stock Exchange |
Large accelerated filer
þ
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Accelerated filer o | Non-accelerated filer o | Smaller reporting company o | |||
(Do not check if a smaller reporting company) |
Definitions | 3 | |||||||
Information Regarding Forward-Looking Statements | 3 | |||||||
Business | 5 | |||||||
Risk Factors | 12 | |||||||
Unresolved Staff Comments | 16 | |||||||
Properties | 16 | |||||||
Legal Proceedings | 29 | |||||||
Submission of Matters to a Vote of Security Holders | 29 | |||||||
Market for Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities | 30 | |||||||
Selected Financial Data | 32 | |||||||
Management’s Discussion and Analysis of Financial Condition and Results of Operations | 33 | |||||||
Quantitative and Qualitative Disclosures about Market Risk | 74 | |||||||
Financial Statements and Supplementary Data | 76 | |||||||
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure | 140 | |||||||
Controls and Procedures | 140 | |||||||
Other Information | 140 | |||||||
Directors, Executive Officers and Corporate Governance | 141 | |||||||
Executive Compensation | 141 | |||||||
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters | 141 | |||||||
Certain Relationships and Related Transactions, and Director Independence | 141 | |||||||
Principal Accounting Fees and Services | 141 | |||||||
Exhibits and Financial Statement Schedules | 142 | |||||||
EX-10.18 | ||||||||
EX-10.19 | ||||||||
EX-10.20 | ||||||||
EX-10.21 | ||||||||
EX-10.22 | ||||||||
EX-12 | ||||||||
EX-21 | ||||||||
EX-23.1 | ||||||||
EX-23.2 | ||||||||
EX-23.3 | ||||||||
EX-23.4 | ||||||||
EX-31.1 | ||||||||
EX-31.2 | ||||||||
EX-32.1 | ||||||||
EX-32.2 | ||||||||
EX-99.1 | ||||||||
EX-99.2 | ||||||||
EX-99.3 | ||||||||
EX-101 INSTANCE DOCUMENT | ||||||||
EX-101 SCHEMA DOCUMENT | ||||||||
EX-101 CALCULATION LINKBASE DOCUMENT | ||||||||
EX-101 LABELS LINKBASE DOCUMENT | ||||||||
EX-101 PRESENTATION LINKBASE DOCUMENT | ||||||||
EX-101 DEFINITION LINKBASE DOCUMENT |
2
3
• | energy markets, including the supply and demand for oil, gas, NGLs and other products or services, and the prices of oil, gas, NGLs, including regional pricing differentials, and other products or services; | |
• | production levels, including Canadian production subject to government royalties, which fluctuate with prices and production, and international production governed by payout agreements, which affect reported production; | |
• | reserve levels; | |
• | competitive conditions; | |
• | technology; | |
• | the availability of capital resources within the securities or capital markets and related risks such as general credit, liquidity, market and interest-rate risks; | |
• | capital expenditure and other contractual obligations; | |
• | currency exchange rates; | |
• | the weather; | |
• | inflation; | |
• | the availability of goods and services; | |
• | drilling risks; | |
• | future processing volumes and pipeline throughput; | |
• | general economic conditions, whether internationally, nationally or in the jurisdictions in which we or our subsidiaries conduct business; | |
• | legislative or regulatory changes, including retroactive royalty or production tax regimes, changes in environmental regulation, environmental risks and liability under federal, state and foreign environmental laws and regulations; | |
• | terrorism; | |
• | occurrence of property acquisitions or divestitures; and | |
• | other factors disclosed under “Item 2. Properties — Proved Reserves and Estimated Future Net Revenue,” “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Item 7A. Quantitative and Qualitative Disclosures About Market Risk” and elsewhere in this report. |
4
Item 1. | Business |
• | exercising capital discipline; | |
• | investing in oil and gas properties with high operating margins; | |
• | balancing our reserves and production mix between natural gas and liquids; | |
• | maintaining a low overall cost structure; | |
• | improving performance through our marketing and midstream operations; and | |
• | preserving financial flexibility. |
5
• | Drilling Success — We drilled 1,135 gross wells with a 99% success rate. As a result of our success with the drill-bit, we replaced approximately 213% of our 2009 production. We added 496 MMBoe of proved reserves during the year with extensions, discoveries and performance revisions. These reserve additions were more than double the 233 MMBoe we produced during 2009. Besides increasing our proved reserves, our drilling success was also the main driver of our 5% production growth in 2009. | |
• | Barnett Shale — We drilled 336 wells in the Barnett Shale field in north Texas in 2009, bringing our total producing wells in the field to almost 4,200 at year end. We exited 2009 with net Barnett Shale production at just over one Bcf of natural gas equivalent per day. We are currently running 16 operated drilling rigs in the Barnett and expect to drill 370 wells in the field in 2010. | |
• | Cana-Woodford Shale — We drilled 47 successful wells in the Cana-Woodford Shale in western Oklahoma in 2009. We also increased our net production from this important new shale-gas resource by nearly 500% to an average of 39 MMcf of natural gas equivalent per day. We have increased our lease position in the Cana-Woodford Shale to 118,000 net acres and expect to drill approximately 85 wells in the field in 2010. | |
• | Haynesville Shale — We drilled eight Haynesville Shale wells in the greater Carthage area of east Texas in 2009. These wells have significantly de-risked our 110,000 net Haynesville Shale acres in the Carthage area. | |
• | Jackfish — In Canada, our 100-percent owned Jackfish oil sands project in Alberta was operational throughout 2009. As measured by production per well and steam-to-oil ratio, Jackfish is one of Canada’s most commercially successful steam-assisted gravity drainage projects. In late 2009, Jackfish’s gross production reached 33.7 MBbls of oil per day. The addition of four more producing wells is expected to push production to the facility’s capacity of 35 MBbls per day in early 2010. |
6
• | Brazil — Offshore Brazil, we participated in two significant deepwater discoveries in 2009. The Devon-operated Itaipu exploratory discovery followed a successful appraisal of the 2008 Wahoo discovery. Both Itaipu and Wahoo are pre-salt prospects located in the Campos Basin. |
7
• | selling NGLs that are either extracted from the gas streams processed by our plants or purchased from third parties for marketing, and | |
• | selling or gathering gas that moves through our transport pipelines and unrelated third-party pipelines. |
• | purchasing the gas streams entering our transport pipelines and plants; | |
• | purchasing fuel needed to operate our plants, compressors and related pipeline facilities; | |
• | purchasing third-party NGLs; | |
• | operating our plants, gathering systems and related facilities; and | |
• | transporting products on unrelated third-party pipelines. |
8
• | acquisition of seismic data; | |
• | location of wells; | |
• | drilling and casing of wells; | |
• | well production; | |
• | spill prevention plans; | |
• | emissions permitting; | |
• | use, transportation, storage and disposal of fluids and materials incidental to oil and gas operations; | |
• | surface usage and the restoration of properties upon which wells have been drilled; | |
• | calculation and disbursement of royalty payments and production taxes; | |
• | plugging and abandoning of wells; | |
• | transportation of production; and | |
• | in international operations, minimum investments in the country of operations. |
9
• | assessing the environmental impact of seismic acquisition, drilling or construction activities; | |
• | the generation, storage, transportation and disposal of waste materials; | |
• | the emission of certain gases into the atmosphere; | |
• | the monitoring, abandonment, reclamation and remediation of well and other sites, including sites of former operations; and | |
• | the development of emergency response and spill contingency plans. |
10
11
Item 1A. | Risk Factors |
• | consumer demand for oil, gas and NGLs; | |
• | conservation efforts; | |
• | OPEC production levels; | |
• | weather; | |
• | regional pricing differentials; | |
• | differing quality of oil produced (i.e., sweet crude versus heavy or sour crude) and Btu content of gas produced; | |
• | the level of imports and exports of oil, gas and NGLs; | |
• | the price and availability of alternative fuels; | |
• | the overall economic environment; and | |
• | governmental regulations and taxes. |
12
• | unexpected drilling conditions; | |
• | pressure or irregularities in reservoir formations; | |
• | equipment failures or accidents; | |
• | fires, explosions, blowouts and surface cratering; | |
• | marine risks such as capsizing, collisions and hurricanes; | |
• | other adverse weather conditions; | |
• | lack of access to pipelines or other transportation methods; | |
• | environmental hazards or liabilities; and | |
• | shortages or delays in the availability of services or delivery of equipment. |
13
• | general strikes and civil unrest; | |
• | the risk of war, acts of terrorism, expropriation, forced renegotiation or modification of existing contracts; | |
• | import and export regulations; | |
• | taxation policies, including royalty and tax increases and retroactive tax claims, and investment restrictions; | |
• | transportation regulations and tariffs; | |
• | exchange controls, currency fluctuations, devaluation or other activities that limit or disrupt markets and restrict payments or the movement of funds; | |
• | laws and policies of the United States affecting foreign trade, including trade sanctions; | |
• | the possibility of being subject to exclusive jurisdiction of foreign courts in connection with legal disputes relating to licenses to operate and concession rights in countries where we currently operate; | |
• | the possible inability to subject foreign persons to the jurisdiction of courts in the United States; and | |
• | difficulties enforcing our rights against a governmental agency because of the doctrine of sovereign immunity and foreign sovereignty over international operations. |
14
15
Item 1B. | Unresolved Staff Comments |
Item 2. | Properties |
16
17
Proved
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Proved
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|||||||||||||||
Reserves
|
Reserves
|
Production
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Production
|
|||||||||||||
(MMBoe)(1) | %(2) | (MMBoe)(1) | %(2) | |||||||||||||
U.S. Onshore
|
||||||||||||||||
Barnett Shale
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1,027 | 37.6 | % | 69 | 29.6 | % | ||||||||||
Carthage
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182 | 6.7 | % | 14 | 6.4 | % | ||||||||||
Permian Basin, Texas
|
127 | 4.6 | % | 9 | 3.9 | % | ||||||||||
Washakie
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93 | 3.4 | % | 7 | 3.0 | % | ||||||||||
Cana-Woodford Shale
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73 | 2.7 | % | 3 | 1.0 | % | ||||||||||
Arkoma-Woodford Shale
|
47 | 1.7 | % | 5 | 2.0 | % | ||||||||||
Groesbeck
|
43 | 1.6 | % | 6 | 2.6 | % | ||||||||||
Haynesville Shale
|
6 | 0.2 | % | 1 | 0.3 | % | ||||||||||
Other U.S. Onshore
|
280 | 10.2 | % | 40 | 17.1 | % | ||||||||||
Total U.S. Onshore
|
1,878 | 68.7 | % | 154 | 65.9 | % | ||||||||||
U.S. Offshore
|
92 | 3.4 | % | 13 | 5.7 | % | ||||||||||
Total U.S.
|
1,970 | 72.1 | % | 167 | 71.6 | % | ||||||||||
Canada
|
||||||||||||||||
Jackfish
|
403 | 14.7 | % | 8 | 3.4 | % | ||||||||||
Northwest
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117 | 4.3 | % | 16 | 7.3 | % | ||||||||||
Lloydminster
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81 | 3.0 | % | 16 | 6.7 | % | ||||||||||
Deep Basin
|
59 | 2.2 | % | 12 | 5.0 | % | ||||||||||
Horn River Basin
|
2 | — | — | — | ||||||||||||
Other Canada
|
101 | 3.7 | % | 14 | 6.0 | % | ||||||||||
Total Canada
|
763 | 27.9 | % | 66 | 28.4 | % | ||||||||||
North America
|
2,733 | 100.0 | % | 233 | 100.0 | % | ||||||||||
(1) | Gas reserves and production are converted to Boe at the rate of six Mcf of gas per Bbl of oil, based upon the approximate relative energy content of gas and oil, which rate is not necessarily indicative of the relationship of gas and oil prices. NGL reserves and production are converted to Boe on a one-to-one basis with oil. | |
(2) | Percentage of proved reserves and production the property bears to total proved reserves and production based on actual figures and not the rounded figures included in this table. |
18
19
• | an undergraduate degree in petroleum engineering from an accredited university, or equivalent; | |
• | a petroleum engineering license, or similar certification; | |
• | memberships in oil and gas industry or trade groups; and | |
• | relevant experience estimating reserves. |
20
2009 | 2008 | 2007 | ||||||||||||||||||||||
Prepared | Audited | Prepared | Audited | Prepared | Audited | |||||||||||||||||||
U.S. Onshore
|
— | 93 | % | — | 92 | % | — | 88 | % | |||||||||||||||
U.S. Offshore
|
100 | % | — | 100 | % | — | 100 | % | — | |||||||||||||||
Total U.S.
|
5 | % | 89 | % | 5 | % | 87 | % | 6 | % | 82 | % | ||||||||||||
Canada
|
— | 91 | % | — | 78 | % | 34 | % | 51 | % | ||||||||||||||
Total North America
|
3 | % | 89 | % | 4 | % | 85 | % | 15 | % | 73 | % |
• | perform an annual review and evaluation of our consolidated oil, gas and NGL reserves; | |
• | verify the integrity of our reserves evaluation and reporting system; | |
• | evaluate, prepare and disclose our compliance with legal and regulatory requirements related to our oil, gas and NGL reserves; | |
• | investigate and verify the qualifications and independence of our independent engineering consultants; | |
• | monitor the performance of our independent engineering consultants; and | |
• | monitor and evaluate our business practices and ethical standards in relation to the preparation and disclosure of reserves. |
21
Natural
|
||||||||||||||||
Oil
|
Natural Gas
|
Gas Liquids
|
Total(1)
|
|||||||||||||
(MMBbls) | (Bcf) | (MMBbls) | (MMBoe) | |||||||||||||
Proved Reserves
|
||||||||||||||||
U.S. Onshore
|
139 | 8,127 | 385 | 1,878 | ||||||||||||
U.S. Offshore
|
33 | 342 | 2 | 92 | ||||||||||||
Total U.S.
|
172 | 8,469 | 387 | 1,970 | ||||||||||||
Canada
|
514 | 1,288 | 34 | 763 | ||||||||||||
Total North America
|
686 | 9,757 | 421 | 2,733 | ||||||||||||
Proved Developed Reserves
|
||||||||||||||||
U.S. Onshore
|
119 | 6,447 | 293 | 1,486 | ||||||||||||
U.S. Offshore
|
21 | 185 | 1 | 53 | ||||||||||||
Total U.S.
|
140 | 6,632 | 294 | 1,539 | ||||||||||||
Canada
|
149 | 1,213 | 32 | 383 | ||||||||||||
Total North America
|
289 | 7,845 | 326 | 1,922 | ||||||||||||
Proved Undeveloped Reserves
|
||||||||||||||||
U.S. Onshore
|
20 | 1,680 | 92 | 392 | ||||||||||||
U.S. Offshore
|
12 | 157 | 1 | 39 | ||||||||||||
Total U.S.
|
32 | 1,837 | 93 | 431 | ||||||||||||
Canada
|
365 | 75 | 2 | 380 | ||||||||||||
Total North America
|
397 | 1,912 | 95 | 811 | ||||||||||||
(1) | Gas reserves are converted to Boe at the rate of six Mcf per Bbl of oil, based upon the approximate relative energy content of gas and oil. This rate is not necessarily indicative of the relationship of natural gas and oil prices. Natural gas liquids reserves are converted to Boe on a one-to-one basis with oil. |
22
Natural
|
||||||||||||||||
Oil
|
Natural Gas
|
Gas Liquids
|
Total(1)
|
|||||||||||||
(MMBbls) | (Bcf) | (MMBbls) | (MMBoe) | |||||||||||||
Proved Developed Producing Reserves
|
||||||||||||||||
U.S. Onshore
|
111 | 5,859 | 265 | 1,354 | ||||||||||||
U.S. Offshore
|
12 | 137 | 1 | 35 | ||||||||||||
Total U.S.
|
123 | 5,996 | 266 | 1,389 | ||||||||||||
Canada
|
137 | 1,075 | 28 | 344 | ||||||||||||
Total North America
|
260 | 7,071 | 294 | 1,733 | ||||||||||||
Proved Developed Non-Producing Reserves
|
||||||||||||||||
U.S. Onshore
|
8 | 588 | 28 | 132 | ||||||||||||
U.S. Offshore
|
9 | 48 | — | 18 | ||||||||||||
Total U.S.
|
17 | 636 | 28 | 150 | ||||||||||||
Canada
|
12 | 138 | 4 | 39 | ||||||||||||
Total North America
|
29 | 774 | 32 | 189 | ||||||||||||
(1) | Gas reserves are converted to Boe at the rate of six Mcf per Bbl of oil, based upon the approximate relative energy content of gas and oil. This rate is not necessarily indicative of the relationship of natural gas and oil prices. Natural gas liquids reserves are converted to Boe on a one-to-one basis with oil. |
Proved undeveloped reserves as of December 31, 2008
|
424 | |||
Revisions due to prices
|
174 | |||
Revisions other than price
|
(22 | ) | ||
Extensions and discoveries
|
316 | |||
Conversion to proved developed reserves
|
(81 | ) | ||
Proved undeveloped reserves as of December 31, 2009
|
811 | |||
23
Total
|
Proved
|
Proved
|
||||||||||
Proved
|
Developed
|
Undeveloped
|
||||||||||
Reserves | Reserves | Reserves | ||||||||||
(In millions) | ||||||||||||
Pre-Tax Future Net Revenue(1)
|
||||||||||||
United States
|
$ | 15,573 | $ | 13,381 | $ | 2,192 | ||||||
Canada
|
14,463 | 6,127 | 8,336 | |||||||||
Total North America
|
$ | 30,036 | $ | 19,508 | $ | 10,528 | ||||||
Pre-Tax 10% Present Value(1)
|
||||||||||||
United States
|
$ | 7,630 | $ | 7,452 | $ | 178 | ||||||
Canada
|
7,243 | 4,210 | 3,033 | |||||||||
Total North America
|
$ | 14,873 | $ | 11,662 | $ | 3,211 | ||||||
Standardized Measure of Discounted Future Net Cash
Flows(1)(2)
|
||||||||||||
United States
|
$ | 5,880 | ||||||||||
Canada
|
5,523 | |||||||||||
Total North America
|
$ | 11,403 | ||||||||||
(1) | Estimated pre-tax future net revenue represents estimated future revenue to be generated from the production of proved reserves, net of estimated production and development costs and site restoration and abandonment charges. The amounts shown do not give effect to depreciation, depletion and amortization, or to non-property related expenses such as debt service and income tax expense. | |
Future net revenues are calculated using prices that represent the average of the first-day-of-the-month price for the 12-month period prior to December 31, 2009. These prices were not changed except where different prices were fixed and determinable from applicable contracts. These assumptions yielded average prices over the life of our properties of $47.80 per Bbl of oil, $3.12 per Mcf of gas and $22.78 per Bbl of NGLs. Costs included in future net revenues are determined in a similar manner. The prices used in calculating the estimated future net revenues attributable to proved reserves do not necessarily reflect market prices for oil, gas and NGL production subsequent to December 31, 2009. There can be no assurance that all of the proved reserves will be produced and sold within the periods indicated, that the assumed prices will be realized or that existing contracts will be honored or judicially enforced. | ||
The present value of after-tax future net revenues discounted at 10% per annum (“standardized measure”) was $11.4 billion at the end of 2009. Included as part of standardized measure were discounted future income taxes of $3.4 billion. Excluding these taxes, the present value of our pre-tax future net revenue (“pre-tax 10% present value”) was $14.8 billion. We believe the pre-tax 10% present value is a useful measure in addition to the after-tax standardized measure. The pre-tax 10% present value assists in both the determination of future cash flows of the current reserves as well as in making relative value comparisons among peer companies. The after-tax standardized measure is dependent on the unique tax situation of each individual company, while the pre-tax 10% present value is based on prices and discount factors, |
24
which are more consistent from company to company. We also understand that securities analysts use the pre-tax 10% present value measure in similar ways. | ||
(2) | See Note 22 to the consolidated financial statements included in “Item 8. Financial Statements and Supplementary Data.” |
Year Ended December 31, 2009 | ||||||||||||||||
Natural
|
||||||||||||||||
Oil
|
Natural Gas
|
Gas Liquids
|
Total(1)
|
|||||||||||||
(MMBbls) | (Bcf) | (MMBbls) | (MMBoe) | |||||||||||||
Production
|
||||||||||||||||
Barnett Shale
|
— | 331 | 13 | 69 | ||||||||||||
Other United States fields
|
17 | 412 | 13 | 98 | ||||||||||||
Total United States
|
17 | 743 | 26 | 167 | ||||||||||||
Jackfish
|
8 | — | — | 8 | ||||||||||||
Other Canada fields
|
17 | 223 | 4 | 58 | ||||||||||||
Total Canada
|
25 | 223 | 4 | 66 | ||||||||||||
Total North America
|
42 | 966 | 30 | 233 | ||||||||||||
Natural
|
||||||||||||||||
Oil
|
Natural Gas
|
Gas Liquids
|
Combined(1)
|
|||||||||||||
(Per Bbl) | (Per Mcf) | (Per Bbl) | (Per Boe) | |||||||||||||
Production Prices
|
||||||||||||||||
Barnett Shale
|
$ | 58.78 | $ | 2.99 | $ | 22.36 | $ | 19.08 | ||||||||
Total United States
|
$ | 57.56 | $ | 3.20 | $ | 23.51 | $ | 23.71 | ||||||||
Jackfish
|
$ | 41.07 | — | — | $ | 41.07 | ||||||||||
Total Canada
|
$ | 47.35 | $ | 3.66 | $ | 33.09 | $ | 32.29 | ||||||||
Total North America
|
$ | 51.39 | $ | 3.31 | $ | 24.71 | $ | 26.15 |
Year Ended December 31, 2008 | ||||||||||||||||
Natural
|
||||||||||||||||
Oil
|
Natural Gas
|
Gas Liquids
|
Total(1)
|
|||||||||||||
(MMBbls) | (Bcf) | (MMBbls) | (MMBoe) | |||||||||||||
Production
|
||||||||||||||||
Barnett Shale
|
— | 321 | 12 | 66 | ||||||||||||
Other United States fields
|
17 | 405 | 12 | 96 | ||||||||||||
Total United States
|
17 | 726 | 24 | 162 | ||||||||||||
Jackfish
|
4 | — | — | 4 | ||||||||||||
Other Canada fields
|
18 | 212 | 4 | 57 | ||||||||||||
Total Canada
|
22 | 212 | 4 | 61 | ||||||||||||
Total North America
|
39 | 938 | 28 | 223 | ||||||||||||
25
Year Ended December 31, 2008 | ||||||||||||||||
Natural
|
||||||||||||||||
Oil
|
Natural Gas
|
Gas Liquids
|
Combined(1)
|
|||||||||||||
(Per Bbl) | (Per Mcf) | (Per Bbl) | (Per Boe) | |||||||||||||
Production Prices
|
||||||||||||||||
Barnett Shale
|
$ | 97.23 | $ | 7.38 | $ | 39.34 | $ | 43.71 | ||||||||
Total United States
|
$ | 98.83 | $ | 7.59 | $ | 41.21 | $ | 50.55 | ||||||||
Jackfish
|
$ | 50.67 | — | — | $ | 50.67 | ||||||||||
Total Canada
|
$ | 71.04 | $ | 8.17 | $ | 61.45 | $ | 57.65 | ||||||||
Total North America
|
$ | 83.35 | $ | 7.73 | $ | 44.08 | $ | 52.49 |
Year Ended December 31, 2007 | ||||||||||||||||
Natural
|
||||||||||||||||
Oil
|
Natural Gas
|
Gas Liquids
|
Total(1)
|
|||||||||||||
(MMBbls) | (Bcf) | (MMBbls) | (MMBoe) | |||||||||||||
Production
|
||||||||||||||||
Barnett Shale
|
— | 238 | 10 | 50 | ||||||||||||
Other United States fields
|
19 | 397 | 12 | 96 | ||||||||||||
Total United States
|
19 | 635 | 22 | 146 | ||||||||||||
Total Canada
|
16 | 227 | 4 | 58 | ||||||||||||
Total North America
|
35 | 862 | 26 | 204 | ||||||||||||
Natural
|
||||||||||||||||
Oil
|
Natural Gas
|
Gas Liquids
|
Combined(1)
|
|||||||||||||
(Per Bbl) | (Per Mcf) | (Per Bbl) | (Per Boe) | |||||||||||||
Production Prices
|
||||||||||||||||
Barnett Shale
|
$ | 70.61 | $ | 5.63 | $ | 34.68 | $ | 34.28 | ||||||||
Total United States
|
$ | 69.23 | $ | 5.87 | $ | 36.11 | $ | 39.77 | ||||||||
Total Canada
|
$ | 49.80 | $ | 6.24 | $ | 46.07 | $ | 41.51 | ||||||||
Total North America
|
$ | 60.30 | $ | 5.97 | $ | 37.76 | $ | 40.26 |
(1) | Gas reserves are converted to Boe at the rate of six Mcf per Bbl of oil, based upon the approximate relative energy content of gas and oil. This rate is not necessarily indicative of the relationship of natural gas and oil prices. Natural gas liquids reserves are converted to Boe on a one-to-one basis with oil. |
Year Ended December 31, | ||||||||||||
2009 | 2008 | 2007 | ||||||||||
Barnett Shale
|
$ | 3.96 | $ | 4.34 | $ | 3.85 | ||||||
Total United States
|
$ | 5.97 | $ | 6.62 | $ | 6.19 | ||||||
Jackfish
|
$ | 12.75 | $ | 28.93 | — | |||||||
Total Canada
|
$ | 10.15 | $ | 12.74 | $ | 10.80 | ||||||
Total North America
|
$ | 7.16 | $ | 8.29 | $ | 7.50 |
26
Year Ended December 31, 2009 | ||||||||||||||||||||||||
Development Wells(1) | Exploratory Wells(1) | Total Wells(1) | ||||||||||||||||||||||
Productive | Dry | Productive | Dry | Productive | Dry | |||||||||||||||||||
U.S. Onshore
|
506.5 | 3.0 | 6.8 | 1.5 | 513.3 | 4.5 | ||||||||||||||||||
U.S. Offshore
|
1.5 | 0.8 | — | 0.5 | 1.5 | 1.3 | ||||||||||||||||||
Total U.S.
|
508.0 | 3.8 | 6.8 | 2.0 | 514.8 | 5.8 | ||||||||||||||||||
Canada
|
307.2 | — | 28.2 | — | 335.4 | — | ||||||||||||||||||
Total North America
|
815.2 | 3.8 | 35.0 | 2.0 | 850.2 | 5.8 | ||||||||||||||||||
Year Ended December 31, 2008 | ||||||||||||||||||||||||
Development
|
||||||||||||||||||||||||
Wells(1) | Exploratory Wells(1) | Total Wells(1) | ||||||||||||||||||||||
Productive | Dry | Productive | Dry | Productive | Dry | |||||||||||||||||||
U.S. Onshore
|
1,024.0 | 17.5 | 12.8 | 2.0 | 1,036.8 | 19.5 | ||||||||||||||||||
U.S. Offshore
|
9.0 | 1.0 | 0.8 | 1.8 | 9.8 | 2.8 | ||||||||||||||||||
Total U.S.
|
1,033.0 | 18.5 | 13.6 | 3.8 | 1,046.6 | 22.3 | ||||||||||||||||||
Canada
|
528.9 | 3.2 | 50.1 | 3.3 | 579.0 | 6.5 | ||||||||||||||||||
Total North America
|
1,561.9 | 21.7 | 63.7 | 7.1 | 1,625.6 | 28.8 | ||||||||||||||||||
Year Ended December 31, 2007 | ||||||||||||||||||||||||
Development
|
||||||||||||||||||||||||
Wells(1) | Exploratory Wells(1) | Total Wells(1) | ||||||||||||||||||||||
Productive | Dry | Productive | Dry | Productive | Dry | |||||||||||||||||||
U.S. Onshore
|
974.4 | 21.1 | 10.1 | 4.0 | 984.5 | 25.1 | ||||||||||||||||||
U.S. Offshore
|
3.7 | — | 1.5 | 0.2 | 5.2 | 0.2 | ||||||||||||||||||
Total U.S.
|
978.1 | 21.1 | 11.6 | 4.2 | 989.7 | 25.3 | ||||||||||||||||||
Canada
|
531.2 | — | 83.3 | 1.5 | 614.5 | 1.5 | ||||||||||||||||||
Total North America
|
1,509.3 | 21.1 | 94.9 | 5.7 | 1,604.2 | 26.8 | ||||||||||||||||||
(1) | These well counts represent net wells completed during each year. Net wells are gross wells multiplied by our fractional working interests on the well. |
Productive | Dry | Still in Progress | Total | |||||||||||||||||||||||||||||
Gross(1) | Net(2) | Gross(1) | Net(2) | Gross(1) | Net(2) | Gross(1) | Net(2) | |||||||||||||||||||||||||
U.S. Onshore
|
13 | 9.1 | — | — | 46 | 33.2 | 59 | 42.3 | ||||||||||||||||||||||||
U.S. Offshore
|
— | — | — | — | 3 | 1.5 | 3 | 1.5 | ||||||||||||||||||||||||
Total U.S.
|
13 | 9.1 | — | — | 49 | 34.7 | 62 | 43.8 | ||||||||||||||||||||||||
Canada
|
18 | 13.7 | — | — | 3 | 2.5 | 21 | 16.2 | ||||||||||||||||||||||||
Total North America
|
31 | 22.8 | — | — | 52 | 37.2 | 83 | 60.0 | ||||||||||||||||||||||||
(1) | Gross wells are the sum of all wells in which we own an interest. |
27
(2) | Net wells are gross wells multiplied by our fractional working interests on the well. |
Oil Wells | Natural Gas Wells | Total Wells | ||||||||||||||||||||||
Gross(1) | Net(2) | Gross(1) | Net(2) | Gross(1) | Net(2) | |||||||||||||||||||
U.S. Onshore
|
8,301 | 2,901 | 19,792 | 13,442 | 28,093 | 16,343 | ||||||||||||||||||
U.S. Offshore
|
359 | 284 | 204 | 138 | 563 | 422 | ||||||||||||||||||
Total U.S.
|
8,660 | 3,185 | 19,996 | 13,580 | 28,656 | 16,765 | ||||||||||||||||||
Canada
|
4,830 | 3,661 | 5,560 | 3,241 | 10,390 | 6,902 | ||||||||||||||||||
Total North America
|
13,490 | 6,846 | 25,556 | 16,821 | 39,046 | 23,667 | ||||||||||||||||||
(1) | Gross wells are the sum of all wells in which we own an interest. | |
(2) | Net wells are gross wells multiplied by our fractional working interests on the well. |
Developed | Undeveloped | Total | ||||||||||||||||||||||
Gross(1) | Net(2) | Gross(1) | Net(2) | Gross(1) | Net(2) | |||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||
U.S. Onshore
|
3,357 | 2,268 | 6,064 | 3,318 | 9,421 | 5,586 | ||||||||||||||||||
U.S. Offshore
|
258 | 139 | 1,809 | 1,029 | 2,067 | 1,168 | ||||||||||||||||||
Total U.S.
|
3,615 | 2,407 | 7,873 | 4,347 | 11,488 | 6,754 | ||||||||||||||||||
Canada
|
3,630 | 2,253 | 7,688 | 5,088 | 11,318 | 7,341 | ||||||||||||||||||
Total North America
|
7,245 | 4,660 | 15,561 | 9,435 | 22,806 | 14,095 | ||||||||||||||||||
(1) | Gross acres are the sum of all acres in which we own an interest. | |
(2) | Net acres are gross acres multiplied by our fractional working interests on the acreage. |
28
Item 3. | Legal Proceedings |
Item 4. | Submission of Matters to a Vote of Security Holders |
29
Item 5. | Market for Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities |
Price Range of Common Stock |
Dividends
|
|||||||||||
High | Low | Per Share | ||||||||||
2009:
|
||||||||||||
Quarter Ended March 31, 2009
|
$ | 73.11 | $ | 38.55 | $ | 0.16 | ||||||
Quarter Ended June 30, 2009
|
$ | 67.40 | $ | 43.35 | $ | 0.16 | ||||||
Quarter Ended September 30, 2009
|
$ | 72.91 | $ | 48.74 | $ | 0.16 | ||||||
Quarter Ended December 31, 2009
|
$ | 75.05 | $ | 62.60 | $ | 0.16 | ||||||
2008:
|
||||||||||||
Quarter Ended March 31, 2008
|
$ | 108.13 | $ | 74.56 | $ | 0.16 | ||||||
Quarter Ended June 30, 2008
|
$ | 127.16 | $ | 101.31 | $ | 0.16 | ||||||
Quarter Ended September 30, 2008
|
$ | 127.43 | $ | 82.10 | $ | 0.16 | ||||||
Quarter Ended December 31, 2008
|
$ | 91.69 | $ | 54.40 | $ | 0.16 |
30
• | $100 was invested on December 31, 2004 in Devon’s common stock, the S&P 500 Index and the SIC Code, and | |
• | Dividends have been reinvested subsequent to the initial investment. |
31
Item 6. | Selected Financial Data |
Year Ended December 31, | ||||||||||||||||||||
2009 | 2008 | 2007 | 2006 | 2005 | ||||||||||||||||
(In millions, except per share data, ratios,
|
||||||||||||||||||||
prices and per Boe amounts) | ||||||||||||||||||||
Operating Results
|
||||||||||||||||||||
Revenues
|
$ | 8,015 | $ | 13,858 | $ | 9,975 | $ | 9,143 | $ | 9,630 | ||||||||||
Total expenses and other income, net(1)
|
12,541 | 18,018 | 6,648 | 5,957 | 5,477 | |||||||||||||||
(Loss) earnings from continuing operations before income taxes
|
(4,526 | ) | (4,160 | ) | 3,327 | 3,186 | 4,153 | |||||||||||||
Total income tax (benefit) expense
|
(1,773 | ) | (1,121 | ) | 842 | 870 | 1,413 | |||||||||||||
(Loss) earnings from continuing operations
|
(2,753 | ) | (3,039 | ) | 2,485 | 2,316 | 2,740 | |||||||||||||
Earnings from discontinued operations(1)
|
274 | 891 | 1,121 | 530 | 190 | |||||||||||||||
Net (loss) earnings
|
$ | (2,479 | ) | $ | (2,148 | ) | $ | 3,606 | $ | 2,846 | $ | 2,930 | ||||||||
Net (loss) earnings applicable to common stockholders
|
$ | (2,479 | ) | $ | (2,153 | ) | $ | 3,596 | $ | 2,836 | $ | 2,920 | ||||||||
Basic net (loss) earnings per share:
|
||||||||||||||||||||
(Loss) earnings from continuing operations
|
$ | (6.20 | ) | $ | (6.86 | ) | $ | 5.56 | $ | 5.22 | $ | 5.96 | ||||||||
Earnings from discontinued operations
|
0.62 | 2.01 | 2.52 | 1.20 | 0.42 | |||||||||||||||
Net (loss) earnings
|
$ | (5.58 | ) | $ | (4.85 | ) | $ | 8.08 | $ | 6.42 | $ | 6.38 | ||||||||
Diluted net (loss) earnings per share:
|
||||||||||||||||||||
(Loss) earnings from continuing operations
|
$ | (6.20 | ) | $ | (6.86 | ) | $ | 5.50 | $ | 5.15 | $ | 5.86 | ||||||||
Earnings from discontinued operations
|
0.62 | 2.01 | 2.50 | 1.19 | 0.40 | |||||||||||||||
Net (loss) earnings
|
$ | (5.58 | ) | $ | (4.85 | ) | $ | 8.00 | $ | 6.34 | $ | 6.26 | ||||||||
Cash dividends per common share
|
$ | 0.64 | $ | 0.64 | $ | 0.56 | $ | 0.45 | $ | 0.30 | ||||||||||
Ratio of earnings to fixed charges(1)(2)
|
N/A | N/A | 6.97 | 7.11 | 7.67 | |||||||||||||||
Ratio of earnings to combined fixed charges and preferred stock
dividends(1)(2)
|
N/A | N/A | 6.78 | 6.91 | 7.49 | |||||||||||||||
Cash Flow Data
|
||||||||||||||||||||
Net cash provided by operating activities
|
$ | 4,737 | $ | 9,408 | $ | 6,651 | $ | 5,993 | $ | 5,612 | ||||||||||
Net cash used in investing activities
|
$ | (5,354 | ) | $ | (6,873 | ) | $ | (5,714 | ) | $ | (7,449 | ) | $ | (1,652 | ) | |||||
Net cash provided by (used in) financing activities
|
$ | 1,201 | $ | (3,408 | ) | $ | (371 | ) | $ | 593 | $ | (3,543 | ) | |||||||
Production, Price and Other Data(3)
|
||||||||||||||||||||
Production:
|
||||||||||||||||||||
Oil (MMBbls)
|
42 | 39 | 35 | 32 | 38 | |||||||||||||||
Gas (Bcf)
|
966 | 938 | 862 | 807 | 816 | |||||||||||||||
NGLs (MMBbls)
|
30 | 28 | 26 | 23 | 24 | |||||||||||||||
Total (MMBoe)(4)
|
233 | 223 | 204 | 190 | 198 | |||||||||||||||
Realized prices without hedges:
|
||||||||||||||||||||
Oil (per Bbl)
|
$ | 51.39 | $ | 83.35 | $ | 60.30 | $ | 56.18 | $ | 47.90 | ||||||||||
Gas (per Mcf)
|
$ | 3.31 | $ | 7.73 | $ | 5.97 | $ | 6.03 | $ | 7.08 | ||||||||||
NGLs (per Bbl)
|
$ | 24.71 | $ | 44.08 | $ | 37.76 | $ | 32.10 | $ | 29.05 | ||||||||||
Combined (per Boe)(4)
|
$ | 26.15 | $ | 52.49 | $ | 40.26 | $ | 39.09 | $ | 41.96 | ||||||||||
Lease operating expenses per Boe(4)
|
$ | 7.16 | $ | 8.29 | $ | 7.50 | $ | 6.48 | $ | 5.60 | ||||||||||
Depreciation, depletion and amortization of oil and gas
properties per Boe(4)
|
$ | 7.86 | $ | 13.20 | $ | 11.81 | $ | 10.28 | $ | 8.62 |
32
December 31, | ||||||||||||||||||||
2009 | 2008 | 2007 | 2006 | 2005 | ||||||||||||||||
(In millions) | ||||||||||||||||||||
Balance Sheet Data
|
||||||||||||||||||||
Total assets(1)
|
$ | 29,686 | $ | 31,908 | $ | 41,456 | $ | 35,063 | $ | 30,273 | ||||||||||
Long-term debt
|
$ | 5,847 | $ | 5,661 | $ | 6,924 | $ | 5,568 | $ | 5,957 | ||||||||||
Stockholders’ equity
|
$ | 15,570 | $ | 17,060 | $ | 22,006 | $ | 17,442 | $ | 14,862 |
(1) | During 2009 and 2008, we recorded noncash reductions of carrying value of oil and gas properties totaling $6.4 billion ($4.1 billion after income taxes) and $9.9 billion ($6.7 billion after income taxes), respectively, related to our continuing operations as discussed in Note 15 of the consolidated financial statements. During 2009, 2008 and 2007 we recorded noncash reductions of carrying value of oil and gas properties totaling $108 million ($105 million after taxes), $494 million ($465 million after taxes) and $68 million ($13 million after taxes) related to our discontinued operations as discussed in Note 18 of the consolidated financial statements. | |
(2) | For purposes of calculating the ratio of earnings to fixed charges and the ratio of earnings to combined fixed charges and preferred stock dividends, (i) earnings consist of earnings from continuing operations before income taxes, plus fixed charges; (ii) fixed charges consist of interest expense and one-third of rental expense estimated to be attributable to interest; and (iii) preferred stock dividends consist of the amount of pre-tax earnings required to pay dividends on the preferred stock that was outstanding until June 2008. |
For 2009, earnings from continuing operations were inadequate to cover fixed charges by $4.6 billion. For 2008, earnings from continuing operations were inadequate to cover fixed charges and combined fixed charges and preferred stock dividends by $4.2 billion. These earnings relationships were primarily the result of the noncash reductions of the carrying values of certain oil and gas properties referred to above. |
(3) | The amounts presented under “Production, Price and Other Data” exclude the amounts related to our discontinued international operations. The price data presented excludes the effects of unrealized and realized gains and losses from our oil and gas derivative financial instruments. | |
(4) | Gas volumes are converted to Boe at the rate of six Mcf of gas per barrel of oil, based upon the approximate relative energy content of gas and oil, which rate is not necessarily indicative of the relationship of gas and oil prices. NGL volumes are converted to Boe on a one-to-one basis with oil. The respective prices of oil, gas and NGLs are affected by market and other factors in addition to relative energy content. |
Item 7. | Management’s Discussion and Analysis of Financial Condition and Results of Operations |
• | Overview of Business | |
• | Overview of 2009 Results | |
• | Business and Industry Outlook | |
• | Results of Operations | |
• | Capital Resources, Uses and Liquidity | |
• | Contingencies and Legal Matters |
33
• | Critical Accounting Policies and Estimates | |
• | Forward-Looking Estimates |
• | Reserves and production growth — Our financial condition and profitability are significantly affected by the amount of proved reserves we own. Oil and gas properties are our most significant assets, and the reserves that relate to such properties are key to our future success. To increase our proved reserves, we must replace quantities produced with additional reserves from successful exploration and development activities or property acquisitions. Additionally, our profitability and operating cash flows are largely dependent on the amount of oil, gas and NGLs we produce. Growing production from existing properties is difficult because the rate of production from oil and gas properties generally declines as reserves are depleted. As a result, we constantly drill for and develop reserves on properties that provide a balance of near-term and long-term production. In addition, we may acquire properties with proved reserves that we can develop and subsequently produce to help us meet our production goals. | |
• | Capital investment discipline — Effectively deploying our resources into capital projects is key to maintaining and growing future production and oil and gas reserves. As a result, we have historically deployed virtually all our available cash flow into capital projects. Therefore, maintaining a disciplined approach to investing in capital projects is important to our profitability and financial condition. Our ability to control capital expenditures can be affected by changes in commodity prices. During times of high commodity prices, drilling and related costs often escalate due to the effects of supply versus demand economics. The inverse is also true. |
• | High margin assets — Like many investors, we seek to invest our capital resources into projects where we can generate the highest risk-adjusted investment returns. One factor that can have a significant impact on such returns is our drilling success rates. Combined with appropriate revenue and cost-management strategies, high drilling success rates are important to generating competitive returns on our capital investment. During 2009, we drilled 1,135 wells and 99% of those were successful. The success rate is similar to our drilling achievements in recent years, demonstrating a proven track record of success. By accomplishing high drilling success rates, we provide an inventory of reserves growth and a platform of opportunities on our undrilled acreage that can be profitably developed. | |
• | Reserves and production balance — As evidenced by history, commodity prices are inherently volatile. In addition, oil and gas prices often diverge due to a variety of circumstances. Consequently, we value a balance of reserves and production between gas and liquids that can add stability to our revenue stream when either commodity price is under pressure. Our production mix in 2009 was |
34
approximately 70% gas and 30% oil and NGLs such as propane, butane and ethane. Our year-end reserves were approximately 60% gas and 40% liquids. With planned future growth in oil from our Jackfish and other projects, combined with an inventory of shale natural gas plays, we expect to maintain this balance in the future. |
• | Operating cost controls — To maintain our competitive position, we must control our lease operating costs and other production costs. As reservoirs are depleted and production rates decline, per unit production costs will generally increase and affect our profitability and operating cash flows. Similar to capital expenditures, our ability to control operating costs can be affected by significant changes in commodity prices. Our base North American production is focused in core areas of our operations where we can achieve economies of scale to help manage our operating costs. | |
• | Marketing and midstream performance improvement — We enhance the value of our oil and gas operations with our marketing and midstream business. By efficiently gathering and processing oil, gas and NGL production, our midstream operations contribute to our strategies to grow reserves and production and manage expenditures. Additionally, by effectively marketing our production, we maximize the prices received for our oil, gas and NGL production in relation to market prices. This is important because our profitability is highly dependent on market prices. These prices are determined primarily by market conditions. Market conditions for these products have been, and will continue to be, influenced by regional and worldwide economic activity, weather and other factors that are beyond our control. To manage this volatility, we utilize financial hedging arrangements and fixed-price physical delivery contracts. As of February 15, 2010, approximately 53% of our 2010 gas production is associated with financial price swaps and collars. Additionally, approximately 65% of our 2010 oil production is associated with financial price collars. | |
• | Financial flexibility preservation — As mentioned, commodity prices have been and will continue to be volatile and will continue to impact our profitability and cash flow. We understand this fact and manage our debt levels accordingly to preserve our liquidity and financial flexibility. We generally operate within the cash flow generated by our operations. However, during periods of low commodity prices, we may use our balance sheet strength to access debt or equity markets, allowing us to preserve our business and maintain momentum until markets recover. When prices improve, we can utilize excess operating cash flow to repay debt and invest in our activities that not only maintain but also increase value per share. |
• | Production grew 4% over 2008, to 233 million Boe. |
35
• | The combined realized price for oil, gas and NGLs per Boe decreased 50% to $26.15. | |
• | Oil and gas hedges generated net gains of $384 million in 2009, including cash receipts of $505 million. | |
• | Marketing and midstream operating profit decreased 25% to $512 million. | |
• | Per unit lease operating costs decreased 14% to $7.16 per Boe. | |
• | Operating cash flow decreased to $4.7 billion, representing a 50% decrease over 2008. | |
• | Capitalized costs incurred in our oil and gas activities were $4.1 billion in 2009. |
36
Year Ended December 31, | ||||||||||||||||||||
2009 vs.
|
2008 vs.
|
|||||||||||||||||||
2009 | 2008(2) | 2008 | 2007(2) | 2007 | ||||||||||||||||
Oil (MMBbls)
|
||||||||||||||||||||
U.S. Onshore
|
12 | +3 | % | 11 | +0 | % | 11 | |||||||||||||
Canada
|
25 | +17 | % | 22 | +34 | % | 16 | |||||||||||||
North American Onshore
|
37 | +12 | % | 33 | +20 | % | 27 | |||||||||||||
U.S. Offshore
|
5 | −15 | % | 6 | −24 | % | 8 | |||||||||||||
Total
|
42 | +8 | % | 39 | +10 | % | 35 | |||||||||||||
Gas (Bcf)
|
||||||||||||||||||||
U.S. Onshore
|
698 | +5 | % | 669 | +20 | % | 558 | |||||||||||||
Canada
|
223 | +5 | % | 212 | −6 | % | 227 | |||||||||||||
North American Onshore
|
921 | +5 | % | 881 | +12 | % | 785 | |||||||||||||
U.S. Offshore
|
45 | −22 | % | 57 | −25 | % | 77 | |||||||||||||
Total
|
966 | +3 | % | 938 | +9 | % | 862 | |||||||||||||
37
Year Ended December 31, | ||||||||||||||||||||
2009 vs.
|
2008 vs.
|
|||||||||||||||||||
2009 | 2008(2) | 2008 | 2007(2) | 2007 | ||||||||||||||||
NGLs (MMBbls)
|
||||||||||||||||||||
U.S. Onshore
|
25 | +9 | % | 24 | +14 | % | 21 | |||||||||||||
Canada
|
4 | −5 | % | 4 | −6 | % | 4 | |||||||||||||
North American Onshore
|
29 | +7 | % | 28 | +11 | % | 25 | |||||||||||||
U.S. Offshore
|
1 | +27 | % | — | −26 | % | 1 | |||||||||||||
Total
|
30 | +7 | % | 28 | +10 | % | 26 | |||||||||||||
Total (MMBoe)(1)
|
||||||||||||||||||||
U.S. Onshore
|
154 | +5 | % | 146 | +17 | % | 124 | |||||||||||||
Canada
|
66 | +9 | % | 61 | +5 | % | 58 | |||||||||||||
North American Onshore
|
220 | +6 | % | 207 | +13 | % | 182 | |||||||||||||
U.S. Offshore
|
13 | −18 | % | 16 | −25 | % | 22 | |||||||||||||
Total
|
233 | +4 | % | 223 | +9 | % | 204 | |||||||||||||
(1) | Gas volumes are converted to Boe at the rate of six Mcf of gas per barrel of oil, based upon the approximate relative energy content of gas and oil, which rate is not necessarily indicative of the relationship of gas and oil prices. NGL volumes are converted to Boe on a one-to-one basis with oil. | |
(2) | All percentage changes included in this table are based on actual figures and not the rounded figures included in the table. |
Year Ended December 31, | ||||||||||||||||||||
2009 vs.
|
2008 vs.
|
|||||||||||||||||||
2009 | 2008(2) | 2008 | 2007(2) | 2007 | ||||||||||||||||
Oil (per Bbl)
|
||||||||||||||||||||
U.S. Onshore
|
$ | 56.17 | −41 | % | $ | 95.63 | +42 | % | $ | 67.34 | ||||||||||
Canada
|
$ | 47.35 | −33 | % | $ | 71.04 | +43 | % | $ | 49.80 | ||||||||||
North American Onshore
|
$ | 50.11 | −37 | % | $ | 79.45 | +39 | % | $ | 56.99 | ||||||||||
U.S. Offshore
|
$ | 60.75 | −42 | % | $ | 104.90 | +46 | % | $ | 71.95 | ||||||||||
Total
|
$ | 51.39 | −38 | % | $ | 83.35 | +38 | % | $ | 60.30 | ||||||||||
Gas (per Mcf)
|
||||||||||||||||||||
U.S. Onshore
|
$ | 3.14 | −58 | % | $ | 7.43 | +30 | % | $ | 5.69 | ||||||||||
Canada
|
$ | 3.66 | −55 | % | $ | 8.17 | +31 | % | $ | 6.24 | ||||||||||
North American Onshore
|
$ | 3.27 | −57 | % | $ | 7.61 | +30 | % | $ | 5.85 | ||||||||||
U.S. Offshore
|
$ | 4.20 | −56 | % | $ | 9.53 | +33 | % | $ | 7.17 | ||||||||||
Total
|
$ | 3.31 | −57 | % | $ | 7.73 | +29 | % | $ | 5.97 |
38
Year Ended December 31, | ||||||||||||||||||||
2009 vs.
|
2008 vs.
|
|||||||||||||||||||
2009 | 2008(2) | 2008 | 2007(2) | 2007 | ||||||||||||||||
NGLs (per Bbl)
|
||||||||||||||||||||
U.S. Onshore
|
$ | 23.40 | −43 | % | $ | 40.97 | +14 | % | $ | 36.08 | ||||||||||
Canada
|
$ | 33.09 | −46 | % | $ | 61.45 | +33 | % | $ | 46.07 | ||||||||||
North American Onshore
|
$ | 24.65 | −44 | % | $ | 43.94 | +16 | % | $ | 37.80 | ||||||||||
U.S. Offshore
|
$ | 27.42 | −46 | % | $ | 51.11 | +39 | % | $ | 36.78 | ||||||||||
Total
|
$ | 24.71 | −44 | % | $ | 44.08 | +17 | % | $ | 37.76 | ||||||||||
Combined (per Boe)(1)
|
||||||||||||||||||||
U.S. Onshore
|
$ | 22.41 | −53 | % | $ | 47.91 | +28 | % | $ | 37.45 | ||||||||||
Canada
|
$ | 32.29 | −44 | % | $ | 57.65 | +39 | % | $ | 41.51 | ||||||||||
North American Onshore
|
$ | 25.38 | −50 | % | $ | 50.78 | +31 | % | $ | 38.74 | ||||||||||
U.S. Offshore
|
$ | 38.83 | −48 | % | $ | 74.55 | +40 | % | $ | 53.30 | ||||||||||
Total
|
$ | 26.15 | −50 | % | $ | 52.49 | +30 | % | $ | 40.26 |
(1) | Gas volumes are converted to Boe at the rate of six Mcf of gas per barrel of oil, based upon the approximate relative energy content of gas and oil, which rate is not necessarily indicative of the relationship of gas and oil prices. NGL volumes are converted to Boe on a one-to-one basis with oil. | |
(2) | All percentage changes included in this table are based on actual figures and not the rounded figures included in the table. |
Oil | Gas | NGL | Total | |||||||||||||
(In millions) | ||||||||||||||||
2007 sales
|
$ | 2,117 | $ | 5,138 | $ | 970 | $ | 8,225 | ||||||||
Changes due to volumes
|
222 | 459 | 95 | 776 | ||||||||||||
Changes due to prices
|
894 | 1,647 | 178 | 2,719 | ||||||||||||
2008 sales
|
3,233 | 7,244 | 1,243 | 11,720 | ||||||||||||
Changes due to volumes
|
258 | 222 | 89 | 569 | ||||||||||||
Changes due to prices
|
(1,338 | ) | (4,269 | ) | (585 | ) | (6,192 | ) | ||||||||
2009 sales
|
$ | 2,153 | $ | 3,197 | $ | 747 | $ | 6,097 | ||||||||
39
40
Year Ended December 31, | ||||||||||||
2009 | 2008 | 2007 | ||||||||||
(In millions) | ||||||||||||
Cash settlement receipts (payments):
|
||||||||||||
Gas price collars
|
$ | 450 | $ | (221 | ) | $ | 2 | |||||
Gas price swaps
|
55 | (203 | ) | 38 | ||||||||
Oil price collars
|
— | 27 | — | |||||||||
Total cash settlements
|
505 | (397 | ) | 40 | ||||||||
Unrealized (losses) gains on fair value changes:
|
||||||||||||
Gas price collars
|
(255 | ) | 255 | (4 | ) | |||||||
Gas price swaps
|
169 | (12 | ) | (22 | ) | |||||||
Gas basis swaps
|
3 | — | — | |||||||||
Oil price collars
|
(38 | ) | — | — | ||||||||
Total unrealized (losses) gains on fair value changes
|
(121 | ) | 243 | (26 | ) | |||||||
Net gain (loss)
|
$ | 384 | $ | (154 | ) | $ | 14 | |||||
Year Ended December 31, 2009 | ||||||||||||||||
Oil
|
Gas
|
NGLs
|
Total
|
|||||||||||||
(Per Bbl) | (Per Mcf) | (Per Bbl) | (Per Boe) | |||||||||||||
Realized price without hedges
|
$ | 51.39 | $ | 3.31 | $ | 24.71 | $ | 26.15 | ||||||||
Cash settlements of hedges
|
— | 0.52 | — | 2.16 | ||||||||||||
Realized price, including cash settlements
|
$ | 51.39 | $ | 3.83 | $ | 24.71 | $ | 28.31 | ||||||||
Year Ended December 31, 2008 | ||||||||||||||||
Oil
|
Gas
|
NGLs
|
Total
|
|||||||||||||
(Per Bbl) | (Per Mcf) | (Per Bbl) | (Per Boe) | |||||||||||||
Realized price without hedges
|
$ | 83.35 | $ | 7.73 | $ | 44.08 | $ | 52.49 | ||||||||
Cash settlements of hedges
|
0.70 | (0.46 | ) | — | (1.78 | ) | ||||||||||
Realized price, including cash settlements
|
$ | 84.05 | $ | 7.27 | $ | 44.08 | $ | 50.71 | ||||||||
Year Ended December 31, 2007 | ||||||||||||||||
Oil
|
Gas
|
NGLs
|
Total
|
|||||||||||||
(Per Bbl) | (Per Mcf) | (Per Bbl) | (Per Boe) | |||||||||||||
Realized price without hedges
|
$ | 60.30 | $ | 5.97 | $ | 37.76 | $ | 40.26 | ||||||||
Cash settlements of hedges
|
— | 0.04 | — | 0.20 | ||||||||||||
Realized price, including cash settlements
|
$ | 60.30 | $ | 6.01 | $ | 37.76 | $ | 40.46 | ||||||||
41
Year Ended December 31, | ||||||||||||||||||||
2009 vs
|
2008 vs
|
|||||||||||||||||||
2009 | 2008(1) | 2008 | 2007(1) | 2007 | ||||||||||||||||
($ in millions) | ||||||||||||||||||||
Marketing and midstream:
|
||||||||||||||||||||
Revenues
|
$ | 1,534 | −33 | % | $ | 2,292 | +32 | % | $ | 1,736 | ||||||||||
Operating costs and expenses
|
1,022 | −37 | % | 1,611 | +32 | % | 1,217 | |||||||||||||
Operating profit
|
$ | 512 | −25 | % | $ | 681 | +31 | % | $ | 519 | ||||||||||
(1) | All percentage changes included in this table are based on actual figures and not the rounded figures included in this table. |
42
Year Ended December 31, | ||||||||||||||||||||
2009 vs.
|
2008 vs.
|
|||||||||||||||||||
2009 | 2008(1) | 2008 | 2007(1) | 2007 | ||||||||||||||||
Lease operating expenses ($ in millions):
|
||||||||||||||||||||
U.S. Onshore
|
$ | 838 | −6 | % | $ | 893 | +25 | % | $ | 712 | ||||||||||
Canada
|
673 | −13 | % | 776 | +24 | % | 627 | |||||||||||||
North American Onshore
|
1,511 | −10 | % | 1,669 | +25 | % | 1,339 | |||||||||||||
U.S. Offshore
|
159 | −13 | % | 182 | −6 | % | 193 | |||||||||||||
Total
|
$ | 1,670 | −10 | % | $ | 1,851 | +21 | % | $ | 1,532 | ||||||||||
Lease operating expenses per Boe:
|
||||||||||||||||||||
U.S. Onshore
|
$ | 5.46 | −11 | % | $ | 6.11 | +7 | % | $ | 5.70 | ||||||||||
Canada
|
$ | 10.15 | −20 | % | $ | 12.74 | +18 | % | $ | 10.80 | ||||||||||
North American Onshore
|
$ | 6.87 | −15 | % | $ | 8.06 | +10 | % | $ | 7.32 | ||||||||||
U.S. Offshore
|
$ | 11.98 | +6 | % | $ | 11.29 | +25 | % | $ | 9.04 | ||||||||||
Total
|
$ | 7.16 | −14 | % | $ | 8.29 | +11 | % | $ | 7.50 |
(1) | All percentage changes included in this table are based on actual figures and not the rounded figures included in this table. |
43
Year Ended December 31, | ||||||||||||||||||||
2009 vs
|
2008 vs
|
|||||||||||||||||||
2009 | 2008(1) | 2008 | 2007(1) | 2007 | ||||||||||||||||
($ in millions) | ||||||||||||||||||||
Production
|
$ | 132 | −57 | % | $ | 306 | +41 | % | $ | 216 | ||||||||||
Ad valorem
|
175 | +8 | % | 162 | +19 | % | 135 | |||||||||||||
Other
|
7 | −4 | % | 8 | +20 | % | 7 | |||||||||||||
Total
|
$ | 314 | −34 | % | $ | 476 | +33 | % | $ | 358 | ||||||||||
(1) | All percentage changes included in this table are based on actual figures and not the rounded figures included in this table. |
Year Ended December 31, | ||||||||||||||||||||
2009 vs
|
2008 vs
|
|||||||||||||||||||
2009 | 2008(1) | 2008 | 2007(1) | 2007 | ||||||||||||||||
Total production volumes (MMBoe)
|
233 | +4 | % | 223 | +9 | % | 204 | |||||||||||||
DD&A rate ($ per Boe)
|
$ | 7.86 | −40 | % | $ | 13.20 | +12 | % | $ | 11.81 | ||||||||||
DD&A expense ($ in millions)
|
$ | 1,832 | −38 | % | $ | 2,948 | +22 | % | $ | 2,412 | ||||||||||
(1) | All percentage changes included in this table are based on actual figures and not the rounded figures included in this table. |
44
(In millions) | ||||
2007 DD&A
|
$ | 2,412 | ||
Change due to volumes
|
224 | |||
Change due to rate
|
312 | |||
2008 DD&A
|
2,948 | |||
Change due to volumes
|
130 | |||
Change due to rate
|
(1,246 | ) | ||
2009 DD&A
|
$ | 1,832 | ||
45
Year Ended December 31, | ||||||||||||||||||||
2009 vs
|
2008 vs
|
|||||||||||||||||||
2009 | 2008(1) | 2008 | 2007(1) | 2007 | ||||||||||||||||
($ in millions) | ||||||||||||||||||||
Gross G&A
|
$ | 1,107 | +0 | % | $ | 1,103 | +24 | % | $ | 903 | ||||||||||
Capitalized G&A
|
(332 | ) | −2 | % | (337 | ) | +26 | % | (277 | ) | ||||||||||
Reimbursed G&A
|
(127 | ) | +5 | % | (121 | ) | +7 | % | (113 | ) | ||||||||||
Net G&A
|
$ | 648 | +0 | % | $ | 645 | +26 | % | $ | 513 | ||||||||||
(1) | All percentage changes included in this table are based on actual figures and not the rounded figures included in this table. |
46
Year Ended December 31, | ||||||||||||
2009 | 2008 | 2007 | ||||||||||
(In millions) | ||||||||||||
Interest based on debt outstanding
|
$ | 437 | $ | 426 | $ | 508 | ||||||
Capitalized interest
|
(94 | ) | (111 | ) | (102 | ) | ||||||
Other
|
6 | 14 | 24 | |||||||||
Total interest expense
|
$ | 349 | $ | 329 | $ | 430 | ||||||
47
Year Ended December 31, | ||||||||||||
2009 | 2008 | 2007 | ||||||||||
(In millions) | ||||||||||||
(Gains) losses from:
|
||||||||||||
Interest rate swaps — fair value changes
|
$ | (66 | ) | $ | (104 | ) | $ | (1 | ) | |||
Interest rate swaps — settlements
|
(40 | ) | (1 | ) | — | |||||||
Chevron common stock
|
— | 363 | (281 | ) | ||||||||
Option embedded in exchangeable debentures
|
— | (109 | ) | 248 | ||||||||
Total
|
$ | (106 | ) | $ | 149 | $ | (34 | ) | ||||
48
Year Ended December 31, | ||||||||||||||||
2009 | 2008 | |||||||||||||||
Net of
|
Net of
|
|||||||||||||||
Gross | Taxes | Gross | Taxes | |||||||||||||
(In millions) | ||||||||||||||||
United States
|
$ | 6,408 | $ | 4,085 | $ | 6,538 | $ | 4,168 | ||||||||
Canada
|
— | — | 3,353 | 2,488 | ||||||||||||
Total
|
$ | 6,408 | $ | 4,085 | $ | 9,891 | $ | 6,656 | ||||||||
March 31, 2009 | December 31, 2008 | September 30, 2008 | ||||||||||||||||||||||||||||||||||
Oil
|
Gas
|
NGLs
|
Oil
|
Gas
|
NGLs
|
Oil
|
Gas
|
NGLs
|
||||||||||||||||||||||||||||
Country
|
(Per Bbl) | (Per Mcf) | (Per Bbl) | (Per Bbl) | (Per Mcf) | (Per Bbl) | (Per Bbl) | (Per Mcf) | (Per Bbl) | |||||||||||||||||||||||||||
United States
|
$ | 47.30 | $ | 2.67 | $ | 17.04 | $ | 42.21 | $ | 4.68 | $ | 16.16 | $ | 97.62 | $ | 5.28 | $ | 38.00 | ||||||||||||||||||
Canada
|
N/A | N/A | N/A | $ | 23.23 | $ | 5.31 | $ | 20.89 | $ | 59.72 | $ | 6.00 | $ | 62.78 |
49
Year Ended December 31, | ||||||||||||
2009 | 2008 | 2007 | ||||||||||
(In millions) | ||||||||||||
Interest and dividend income
|
$ | 8 | $ | 54 | $ | 48 | ||||||
Reduction of deep water royalties
|
84 | — | — | |||||||||
Hurricane insurance proceeds
|
— | 162 | — | |||||||||
Other
|
(24 | ) | 1 | 3 | ||||||||
Total
|
$ | 68 | $ | 217 | $ | 51 | ||||||
50
Year Ended December 31, | ||||||||||||
2009 | 2008 | 2007 | ||||||||||
Total income tax (benefit) expense (In millions)
|
$ | (1,773 | ) | $ | (1,121 | ) | $ | 842 | ||||
U.S. statutory income tax rate
|
(35 | )% | (35 | )% | 35 | % | ||||||
State income taxes
|
(2 | )% | (1 | )% | 1 | % | ||||||
Taxation on Canadian operations
|
(1 | )% | 5 | % | — | |||||||
Repatriations and tax policy election changes
|
— | 7 | % | — | ||||||||
Canadian statutory rate reduction
|
— | — | (8 | )% | ||||||||
Other
|
(1 | )% | (3 | )% | (3 | )% | ||||||
Effective income tax (benefit) expense rate
|
(39 | )% | (27 | )% | 25 | % | ||||||
51
Year Ended December 31, | ||||||||||||
2009 | 2008 | 2007 | ||||||||||
Total production (MMBoe)
|
16 | 18 | 32 | |||||||||
Combined price without hedges (per Boe)
|
$ | 59.25 | $ | 92.72 | $ | 68.11 | ||||||
(In millions) | ||||||||||||
Operating revenues
|
$ | 945 | $ | 1,702 | $ | 2,168 | ||||||
Expenses and other income, net:
|
||||||||||||
Operating expenses
|
484 | 769 | 597 | |||||||||
Restructuring costs
|
48 | — | — | |||||||||
Reduction of carrying value of oil and gas properties
|
108 | 494 | 68 | |||||||||
Gain on sale of oil and gas properties
|
(17 | ) | (819 | ) | (90 | ) | ||||||
Total expenses and other income, net
|
623 | 444 | 575 | |||||||||
Earnings before income taxes
|
322 | 1,258 | 1,593 | |||||||||
Income tax expense
|
48 | 367 | 472 | |||||||||
Earnings from discontinued operations
|
$ | 274 | $ | 891 | $ | 1,121 | ||||||
Year Ended December 31, | ||||||||||||||||||||||||
2009 | 2008 | 2007 | ||||||||||||||||||||||
Net of
|
Net of
|
Net of
|
||||||||||||||||||||||
Gross | Taxes | Gross | Taxes | Gross | Taxes | |||||||||||||||||||
(In millions) | ||||||||||||||||||||||||
Egypt
|
$ | — | $ | — | $ | — | $ | — | $ | 90 | $ | 90 | ||||||||||||
Equatorial Guinea
|
— | — | 619 | 544 | — | — | ||||||||||||||||||
Gabon
|
— | — | 117 | 122 | — | — | ||||||||||||||||||
Cote d’Ivoire
|
17 | 17 | 83 | 95 | — | — | ||||||||||||||||||
Other
|
— | — | — | 8 | — | — | ||||||||||||||||||
Total
|
$ | 17 | $ | 17 | $ | 819 | $ | 769 | $ | 90 | $ | 90 | ||||||||||||
52
2009 | 2008 | 2007 | ||||||||||
(In millions) | ||||||||||||
Sources of cash and cash equivalents:
|
||||||||||||
Operating cash flow — continuing operations
|
$ | 4,232 | $ | 8,448 | $ | 5,308 | ||||||
Sales of property and equipment
|
34 | 117 | 76 | |||||||||
Net credit facility borrowings
|
— | — | 1,450 | |||||||||
Net commercial paper borrowings
|
1,431 | 1 | — | |||||||||
Proceeds from debt issuance, net of commercial paper repayments
|
182 | — | — | |||||||||
Net decrease in investments
|
7 | 250 | 202 | |||||||||
Stock option exercises
|
42 | 116 | 91 | |||||||||
Proceeds from exchange of Chevron stock
|
— | 280 | — | |||||||||
Cash distributed from discontinued operations
|
— | 1,898 | — | |||||||||
Other
|
8 | 59 | 43 | |||||||||
Total sources of cash and cash equivalents
|
5,936 | 11,169 | 7,170 | |||||||||
Uses of cash and cash equivalents:
|
||||||||||||
Capital expenditures
|
(4,879 | ) | (8,843 | ) | (5,709 | ) | ||||||
Net credit facility repayments
|
— | (1,450 | ) | — | ||||||||
Net commercial paper repayments
|
— | — | (804 | ) | ||||||||
Debt repayments
|
(178 | ) | (1,031 | ) | (567 | ) | ||||||
Repurchases of common stock
|
— | (665 | ) | (326 | ) | |||||||
Redemption of preferred stock
|
— | (150 | ) | — | ||||||||
Dividends
|
(284 | ) | (289 | ) | (259 | ) | ||||||
Other
|
(17 | ) | — | — | ||||||||
Total uses of cash and cash equivalents
|
(5,358 | ) | (12,428 | ) | (7,665 | ) | ||||||
Increase (decrease) from continuing operations
|
578 | (1,259 | ) | (495 | ) | |||||||
Increase from discontinued operations, net of distributions to
continuing operations
|
6 | 386 | 1,061 | |||||||||
Effect of foreign exchange rates
|
43 | (116 | ) | 51 | ||||||||
Net increase (decrease) in cash and cash equivalents
|
$ | 627 | $ | (989 | ) | $ | 617 | |||||
Cash and cash equivalents at end of year
|
$ | 1,011 | $ | 384 | $ | 1,373 | ||||||
Short-term investments at end of year
|
$ | — | $ | — | $ | 372 | ||||||
53
54
2009 | 2008 | 2007 | ||||||||||
(In millions) | ||||||||||||
U.S. Onshore
|
$ | 2,413 | $ | 5,606 | $ | 3,280 | ||||||
Canada
|
1,064 | 1,459 | 1,232 | |||||||||
North American Onshore
|
3,477 | 7,065 | 4,512 | |||||||||
U.S. Offshore
|
845 | 1,157 | 687 | |||||||||
Total exploration and development
|
4,322 | 8,222 | 5,199 | |||||||||
Midstream
|
323 | 451 | 370 | |||||||||
Other
|
234 | 170 | 141 | |||||||||
Total continuing operations
|
$ | 4,879 | $ | 8,843 | $ | 5,710 | ||||||
55
2008 | 2007 | |||||||||||||||||||||||
Repurchase Program
|
Amount | Shares | Per Share | Amount | Shares | Per Share | ||||||||||||||||||
Annual program
|
$ | 178 | 2.0 | $ | 87.83 | $ | — | — | $ | — | ||||||||||||||
2007 program
|
487 | 4.5 | $ | 109.25 | 326 | 4.1 | $ | 79.80 | ||||||||||||||||
Totals
|
$ | 665 | 6.5 | $ | 102.56 | $ | 326 | 4.1 | $ | 79.80 | ||||||||||||||
56
57
Senior Credit Facility:
|
||||
April 7, 2012 maturity
|
$ | 500 | ||
April 7, 2013 maturity
|
2,150 | |||
Total Senior Credit Facility
|
2,650 | |||
Short-Term Facility — November 2, 2010 maturity
|
700 | |||
Total credit facilities
|
3,350 | |||
Less:
|
||||
Outstanding credit facility borrowings
|
— | |||
Outstanding commercial paper borrowings
|
1,257 | |||
Outstanding letters of credit
|
88 | |||
Total available capacity
|
$ | 2,005 | ||
58
Payments Due by Period | ||||||||||||||||||||
Less Than
|
1-3
|
3-5
|
More Than
|
|||||||||||||||||
Total | 1 Year | Years | Years | 5 Years | ||||||||||||||||
(In millions) | ||||||||||||||||||||
North American Onshore:
|
||||||||||||||||||||
Debt(1)
|
$ | 7,267 | $ | 1,432 | $ | 2,110 | $ | 500 | $ | 3,225 | ||||||||||
Interest expense(2)
|
4,998 | 406 | 666 | 508 | 3,418 | |||||||||||||||
Drilling and facility obligations(3)
|
1,136 | 659 | 395 | 81 | 1 | |||||||||||||||
Firm transportation agreements(4)
|
1,939 | 298 | 508 | 419 | 714 | |||||||||||||||
Asset retirement obligations(5)
|
1,068 | 44 | 115 | 150 | 759 | |||||||||||||||
Lease obligations(6)
|
347 | 57 | 94 | 49 | 147 | |||||||||||||||
Other(7)
|
518 | 129 | 128 | 57 | 204 | |||||||||||||||
Total North American Onshore
|
17,273 | 3,025 | 4,016 | 1,764 | 8,468 | |||||||||||||||
Offshore:
|
||||||||||||||||||||
Drilling and facility obligations(3)
|
2,113 | 955 | 775 | 383 | — | |||||||||||||||
Asset retirement obligations(5)
|
554 | 51 | 141 | 61 | 301 | |||||||||||||||
Lease obligations(6)
|
602 | 121 | 182 | 176 | 123 | |||||||||||||||
Total Offshore
|
3,269 | 1,127 | 1,098 | 620 | 424 | |||||||||||||||
Grand Total
|
$ | 20,542 | $ | 4,152 | $ | 5,114 | $ | 2,384 | $ | 8,892 | ||||||||||
59
(1) | Debt amounts represent scheduled maturities of our debt obligations at December 31, 2009, excluding $12 million of net premiums included in the carrying value of debt. | |
(2) | Interest expense related to our fixed-rate debt represents the scheduled cash payments. Interest related to our variable-rate commercial paper borrowings was estimated based upon expected future interest rates as of December 31, 2009. | |
(3) | Drilling and facility obligations represent contractual agreements with third-party service providers to procure drilling rigs and other related services for developmental and exploratory drilling and facilities construction. Included in the $2.1 billion of offshore obligations is $1.4 billion that relates to long-term contracts for three deepwater drilling rigs and certain other contracts for offshore drilling and facility obligations in which drilling or facilities construction has not commenced. The $1.4 billion represents the gross commitment under these contracts. Our ultimate payment for these commitments will be reduced by any amounts billed to our working interest partners until we sell the associated offshore properties. Payments for these commitments, net of amounts billed to partners, will be capitalized as a component of oil and gas properties. |
Additionally, our commitment under these contracts may be further reduced if the buyers of our offshore assets assume all or a portion of the obligations. If the buyers do not assume these obligations, we will attempt to sublease the rigs to reduce our commitment. However, if the buyers do not assume the obligations and we are not able to sublease the rigs, we would be contractually committed to the amounts related to the remaining lease periods. |
(4) | Firm transportation agreements represent “ship or pay” arrangements whereby we have committed to ship certain volumes of oil, gas and NGLs for a fixed transportation fee. We have entered into these agreements to aid the movement of our production to market. We expect to have sufficient production to utilize the majority of these transportation services. | |
(5) | Asset retirement obligations represent estimated discounted costs for future dismantlement, abandonment and rehabilitation costs. These obligations are recorded as liabilities on our December 31, 2009 balance sheet. | |
(6) | Lease obligations consist of operating leases for office space and equipment, an offshore platform spar and FPSO’s. Office and equipment leases represent non-cancelable leases for office space and equipment used in our daily operations. |
We have an offshore platform spar that is being used in the development of the Nansen field in the Gulf of Mexico. This spar is subject to a 20-year lease and contains various options whereby we may purchase the lessors’ interests in the spars. We have guaranteed that the spar will have a residual value at the end of the term equal to at least 10% of the fair value of the spar at the inception of the lease. The total guaranteed value is $14 million in 2022. However, such amount may be reduced under the terms of the lease agreements. In 2005, we sold our interests in the Boomvang field in the Gulf of Mexico, which has a spar lease with terms similar to those of the Nansen lease. As a result of the sale, we are subleasing the Boomvang spar. The table above does not include any amounts related to the Boomvang spar lease. However, if the sublessee were to default on its obligation, we would continue to be obligated to pay the periodic lease payments and any guaranteed value required at the end of the term. | |
We also lease three FPSO’s that are related to the Panyu project offshore China, the Polvo project offshore Brazil and the Cascade project offshore the Gulf of Mexico. The Panyu FPSO lease term expires in 2018. The Polvo FPSO lease term expires in 2014. The Cascade FPSO lease term expires in 2015. We expect the eventual buyers of these offshore assets will assume the FPSO leases. However, the amounts in the table reflect our full commitments under the leases. |
(7) | These amounts include $272 million related to uncertain tax positions. Expected pension funding obligations have not been included in this table, but are presented and discussed in the section immediately below. |
60
61
62
63
64
65
66
67
Oil
|
Gas
|
NGLs
|
Total
|
|||||||||||||
(MMBbls) | (Bcf) | (MMBbls) | (MMBoe) | |||||||||||||
U.S. Onshore
|
13 | 692 | 28 | 156 | ||||||||||||
Canada
|
28 | 204 | 3 | 65 | ||||||||||||
North American Onshore
|
41 | 896 | 31 | 221 | ||||||||||||
U.S. Offshore
|
4 | 46 | — | 12 | ||||||||||||
Total
|
45 | 942 | 31 | 233 | ||||||||||||
Expected Range of Prices
|
||||
as a % of NYMEX Price | ||||
Oil | Gas | |||
U.S. Onshore
|
90% to 100% | 75% to 85% | ||
Canada
|
65% to 75% | 85% to 95% | ||
North American Onshore
|
72% to 82% | 77% to 87% | ||
U.S. Offshore
|
95% to 105% | 100% to 110% |
Gas Price Swaps | ||||||||
Weighted
|
||||||||
Volume
|
Average Price
|
|||||||
Period
|
(MMBtu/d) | ($/MMBtu) | ||||||
Total year
|
1,265,000 | $ | 6.16 |
68
Gas Basis Swaps | ||||||||||
Weighted Average
|
||||||||||
Differential to
|
||||||||||
Volume
|
Henry Hub
|
|||||||||
Period
|
Index | (MMBtu/d) | ($/MMBtu) | |||||||
Total year
|
AECO | 150,000 | $ | 0.33 | ||||||
Total year
|
CIG | 70,000 | $ | 0.37 |
Gas Price Collars | ||||||||||||||||||||
Floor Price | Ceiling Price | |||||||||||||||||||
Weighted
|
Weighted
|
|||||||||||||||||||
Volume
|
Floor Range
|
Average Price
|
Ceiling Range
|
Average Price
|
||||||||||||||||
Period
|
(MMBtu/d) | ($/MMBtu/d) | ($/MMBtu/d) | ($/MMBtu/d) | ($/MMBtu/d) | |||||||||||||||
First Quarter
|
70,000 | $ | 5.40 - $5.40 | $ | 5.40 | $ | 6.01 - $6.14 | $ | 6.06 | |||||||||||
Second Quarter
|
95,000 | $ | 5.50 - $5.50 | $ | 5.50 | $ | 6.80 - $7.10 | $ | 6.94 | |||||||||||
Third Quarter
|
95,000 | $ | 5.50 - $5.50 | $ | 5.50 | $ | 6.80 - $7.10 | $ | 6.94 | |||||||||||
Fourth Quarter
|
95,000 | $ | 5.50 - $5.50 | $ | 5.50 | $ | 6.80 - $7.10 | $ | 6.94 | |||||||||||
Total year
|
88,836 | $ | 5.40 - $5.50 | $ | 5.48 | $ | 6.01 - $7.10 | $ | 6.76 |
Oil Price Collars | ||||||||||||||||||||
Floor Price | Ceiling Price | |||||||||||||||||||
Weighted
|
Weighted
|
|||||||||||||||||||
Volume
|
Floor Range
|
Average Price
|
Ceiling Range
|
Average Price
|
||||||||||||||||
Period
|
(Bbls/d) | ($/Bbl) | ($/Bbl) | ($/Bbl) | ($/Bbl) | |||||||||||||||
Total year
|
79,000 | $ | 65.00 - $70.00 | $ | 67.47 | $ | 90.35 - $103.30 | $ | 96.48 |
69
70
71
Fixed Rate
|
Variable
|
|||||||||||
Notional
|
Received
|
Rate Paid
|
Expiration
|
|||||||||
(In millions) | ||||||||||||
$ | 300 | 4.30 | % | Six month LIBOR | July 18, 2011 | |||||||
$ | 100 | 1.90 | % | Federal funds rate | August 3, 2012 | |||||||
$ | 500 | 3.90 | % | Federal funds rate | July 18, 2013 | |||||||
$ | 250 | 3.85 | % | Federal funds rate | July 22, 2013 | |||||||
$ | 1,150 | 3.82 | % | |||||||||
Low | High | |||||||
($ in millions,
|
||||||||
except per Boe) | ||||||||
Oil production (MMBbls)
|
14 | 16 | ||||||
Average oil price as a % of NYMEX
|
90 | % | 100 | % | ||||
LOE
|
$ | 190 | $ | 210 | ||||
Taxes other than income taxes as % of revenue
|
10.25 | % | 11.25 | % | ||||
Accretion of asset retirement obligation
|
$ | 5 | $ | 5 | ||||
Income tax rates:
|
||||||||
Current
|
20 | % | 30 | % | ||||
Deferred
|
(5 | )% | — | % | ||||
Total
|
15 | % | 30 | % | ||||
Development capital
|
$ | 220 | $ | 260 | ||||
Exploration capital
|
$ | 240 | $ | 280 | ||||
Total development & exploration
|
$ | 460 | $ | 540 | ||||
Other capital
|
$ | 80 | $ | 90 |
72
U.S.
|
North American
|
U.S.
|
||||||||||||||||||
Onshore | Canada | Onshore | Offshore | Total | ||||||||||||||||
(In millions) | ||||||||||||||||||||
Development capital
|
$ | 2,210-$2,470 | $ | 1,010-$1,140 | $ | 3,220-$3,610 | $ | 420-$500 | $ | 3,640-$4,110 | ||||||||||
Exploration capital
|
$ | 520-$560 | $ | 20-$30 | $ | 540-$590 | $ | 100-$120 | $ | 640-$710 | ||||||||||
Total
|
$ | 2,730-$3,030 | $ | 1,030-$1,170 | $ | 3,760-$4,200 | $ | 520-$620 | $ | 4,280-$4,820 | ||||||||||
73
Item 7A. | Quantitative and Qualitative Disclosures about Market Risk |
2010 Gas Price Swaps | ||||||||
Weighted
|
||||||||
Volume
|
Average Price
|
|||||||
Period
|
(MMBtu/d) | ($/MMBtu) | ||||||
Total year
|
1,265,000 | $ | 6.16 |
2010 Gas Basis Swaps | ||||||||||
Weighted Average
|
||||||||||
Differential
|
||||||||||
Volume
|
to Henry Hub
|
|||||||||
Period
|
Index | (MMBtu/d) | ($/MMBtu) | |||||||
Total year
|
AECO | 150,000 | $ | 0.33 | ||||||
Total year
|
CIG | 70,000 | $ | 0.37 |
2010 Oil Price Collars | ||||||||||||||||||||
Floor Price | Ceiling Price | |||||||||||||||||||
Weighted
|
Weighted
|
|||||||||||||||||||
Volume
|
Floor Range
|
Average Price
|
Ceiling Range
|
Average Price
|
||||||||||||||||
Period
|
(Bbls/d) | ($/Bbl) | ($/Bbl) | ($/Bbl) | ($/Bbl) | |||||||||||||||
Total year
|
79,000 | $ | 65.00 - $70.00 | $ | 67.47 | $ | 90.35 - $103.30 | $ | 96.48 |
74
Fixed-to-Floating Swaps | ||||||||||||
Fixed Rate
|
Variable
|
|||||||||||
Notional
|
Received
|
Rate Paid
|
Expiration
|
|||||||||
(In millions) | ||||||||||||
$ | 300 | 4.30 | % | Six month LIBOR | July 18, 2011 | |||||||
$ | 100 | 1.90 | % | Federal funds rate | August 3, 2012 | |||||||
$ | 500 | 3.90 | % | Federal funds rate | July 18, 2013 | |||||||
$ | 250 | 3.85 | % | Federal funds rate | July 22, 2013 | |||||||
$ | 1,150 | 3.82 | % | |||||||||
Forward Starting Swaps | ||||||||||||
Fixed Rate
|
Variable
|
|||||||||||
Notional
|
Paid
|
Rate Received
|
Expiration
|
|||||||||
(In millions) | ||||||||||||
$ | 700 | 3.99 | % | Three month LIBOR | September 30, 2011 |
75
Item 8. | Financial Statements and Supplementary Data |
Report of Independent Registered Public Accounting Firm
|
77 | |||
Consolidated Financial Statements
|
78 | |||
Consolidated Balance Sheets as of December 31, 2009 and 2008
|
78 | |||
Consolidated Statements of Operations for the Years Ended
December 31, 2009, 2008 and 2007
|
79 | |||
Consolidated Statements of Comprehensive (Loss) Income for the
Years Ended December 31, 2009, 2008 and 2007
|
80 | |||
Consolidated Statements of Stockholders’ Equity for the
Years Ended December 31, 2009, 2008 and 2007
|
81 | |||
Consolidated Statements of Cash Flows for the Years Ended
December 31, 2009, 2008 and 2007
|
82 | |||
Notes to Consolidated Financial Statements
|
83 |
76
77
December 31, | ||||||||
2009 | 2008 | |||||||
(In millions, except share data) | ||||||||
ASSETS
|
||||||||
Current assets:
|
||||||||
Cash and cash equivalents
|
$ | 646 | $ | 195 | ||||
Accounts receivable
|
1,208 | 1,300 | ||||||
Derivative financial instruments, at fair value
|
211 | 282 | ||||||
Current assets held for sale
|
657 | 392 | ||||||
Other current assets
|
270 | 515 | ||||||
Total current assets
|
2,992 | 2,684 | ||||||
Property and equipment, at cost, based on the full cost method
of accounting
for oil and gas properties ($4,078 million and $4,248 million excluded from amortization in 2009 and 2008, respectively) |
60,475 | 53,391 | ||||||
Less accumulated depreciation, depletion and amortization
|
41,708 | 31,360 | ||||||
Property and equipment, net
|
18,767 | 22,031 | ||||||
Goodwill
|
5,930 | 5,511 | ||||||
Long-term assets held for sale
|
1,250 | 1,128 | ||||||
Other long-term assets, including $246 million and
$199 million at fair value in
2009 and 2008, respectively |
747 | 554 | ||||||
Total assets
|
$ | 29,686 | $ | 31,908 | ||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
||||||||
Current liabilities:
|
||||||||
Accounts payable — trade
|
$ | 1,137 | $ | 1,612 | ||||
Revenues and royalties due to others
|
486 | 490 | ||||||
Short-term debt
|
1,432 | 180 | ||||||
Current portion of asset retirement obligations, at fair value
|
95 | 138 | ||||||
Current liabilities associated with assets held for sale
|
234 | 365 | ||||||
Other current liabilities, including $38 million at fair
value in 2009
|
418 | 350 | ||||||
Total current liabilities
|
3,802 | 3,135 | ||||||
Long-term debt
|
5,847 | 5,661 | ||||||
Asset retirement obligations, at fair value
|
1,418 | 1,249 | ||||||
Liabilities associated with assets held for sale, including
$109 million and $98
million at fair value in 2009 and 2008, respectively |
213 | 166 | ||||||
Other long-term liabilities
|
937 | 1,023 | ||||||
Deferred income taxes
|
1,899 | 3,614 | ||||||
Stockholders’ equity:
|
||||||||
Common stock of $0.10 par value. Authorized
1.0 billion shares;
issued 446.7 million and 443.7 million shares in 2009 and 2008, respectively |
45 | 44 | ||||||
Additional paid-in capital
|
6,527 | 6,257 | ||||||
Retained earnings
|
7,613 | 10,376 | ||||||
Accumulated other comprehensive income
|
1,385 | 383 | ||||||
Total stockholders’ equity
|
15,570 | 17,060 | ||||||
Commitments and contingencies (Note 10)
|
||||||||
Total liabilities and stockholders’ equity
|
$ | 29,686 | $ | 31,908 | ||||
78
Year Ended December 31, | ||||||||||||
2009 | 2008 | 2007 | ||||||||||
(In millions, except per share amounts) | ||||||||||||
Revenues:
|
||||||||||||
Oil, gas and NGL sales
|
$ | 6,097 | $ | 11,720 | $ | 8,225 | ||||||
Net gain (loss) on oil and gas derivative financial instruments
|
384 | (154 | ) | 14 | ||||||||
Marketing and midstream revenues
|
1,534 | 2,292 | 1,736 | |||||||||
Total revenues
|
8,015 | 13,858 | 9,975 | |||||||||
Expenses and other income, net:
|
||||||||||||
Lease operating expenses
|
1,670 | 1,851 | 1,532 | |||||||||
Taxes other than income taxes
|
314 | 476 | 358 | |||||||||
Marketing and midstream operating costs and expenses
|
1,022 | 1,611 | 1,217 | |||||||||
Depreciation, depletion and amortization of oil and gas
properties
|
1,832 | 2,948 | 2,412 | |||||||||
Depreciation and amortization of non-oil and gas properties
|
276 | 255 | 201 | |||||||||
Accretion of asset retirement obligations
|
91 | 80 | 70 | |||||||||
General and administrative expenses
|
648 | 645 | 513 | |||||||||
Restructuring costs
|
105 | — | — | |||||||||
Interest expense
|
349 | 329 | 430 | |||||||||
Change in fair value of other financial instruments
|
(106 | ) | 149 | (34 | ) | |||||||
Reduction of carrying value of oil and gas properties
|
6,408 | 9,891 | — | |||||||||
Other income, net
|
(68 | ) | (217 | ) | (51 | ) | ||||||
Total expenses and other income, net
|
12,541 | 18,018 | 6,648 | |||||||||
Earnings (loss) from continuing operations before income taxes
|
(4,526 | ) | (4,160 | ) | 3,327 | |||||||
Income tax expense (benefit):
|
||||||||||||
Current
|
241 | 441 | 235 | |||||||||
Deferred
|
(2,014 | ) | (1,562 | ) | 607 | |||||||
Total income tax expense (benefit)
|
(1,773 | ) | (1,121 | ) | 842 | |||||||
Earnings (loss) from continuing operations
|
(2,753 | ) | (3,039 | ) | 2,485 | |||||||
Discontinued operations:
|
||||||||||||
Earnings from discontinued operations before income taxes
|
322 | 1,258 | 1,593 | |||||||||
Discontinued operations income tax expense
|
48 | 367 | 472 | |||||||||
Earnings from discontinued operations
|
274 | 891 | 1,121 | |||||||||
Net earnings (loss)
|
(2,479 | ) | (2,148 | ) | 3,606 | |||||||
Preferred stock dividends
|
— | 5 | 10 | |||||||||
Net earnings (loss) applicable to common stockholders
|
$ | (2,479 | ) | $ | (2,153 | ) | $ | 3,596 | ||||
Basic net earnings (loss) per share:
|
||||||||||||
Basic earnings (loss) from continuing operations per share
|
$ | (6.20 | ) | $ | (6.86 | ) | $ | 5.56 | ||||
Basic earnings from discontinued operations per share
|
0.62 | 2.01 | 2.52 | |||||||||
Basic net earnings (loss) per share
|
$ | (5.58 | ) | $ | (4.85 | ) | $ | 8.08 | ||||
Diluted net earnings (loss) per share:
|
||||||||||||
Diluted earnings (loss) from continuing operations per share
|
$ | (6.20 | ) | $ | (6.86 | ) | $ | 5.50 | ||||
Diluted earnings from discontinued operations per share
|
0.62 | 2.01 | 2.50 | |||||||||
Diluted net earnings (loss) per share
|
$ | (5.58 | ) | $ | (4.85 | ) | $ | 8.00 | ||||
79
Year Ended December 31, | ||||||||||||
2009 | 2008 | 2007 | ||||||||||
(In millions) | ||||||||||||
Net earnings (loss)
|
$ | (2,479 | ) | $ | (2,148 | ) | $ | 3,606 | ||||
Foreign currency translation:
|
||||||||||||
Change in cumulative translation adjustment
|
993 | (1,960 | ) | 1,389 | ||||||||
Foreign currency translation income tax benefit (expense)
|
(62 | ) | 79 | (42 | ) | |||||||
Foreign currency translation total
|
931 | (1,881 | ) | 1,347 | ||||||||
Pension and postretirement benefit plans:
|
||||||||||||
Net actuarial gain (loss) and prior service cost arising in
current year
|
59 | (239 | ) | (90 | ) | |||||||
Recognition of net actuarial loss and prior service cost in net
earnings (loss)
|
54 | 18 | 14 | |||||||||
Curtailment of pension benefits
|
— | — | 16 | |||||||||
Pension and postretirement benefit plans income tax benefit
(expense)
|
(42 | ) | 80 | 23 | ||||||||
Pension and postretirement benefit plans total
|
71 | (141 | ) | (37 | ) | |||||||
Reclassification adjustment for realized gains included in net
earnings
|
— | — | (1 | ) | ||||||||
Other comprehensive earnings (loss), net of tax
|
1,002 | (2,022 | ) | 1,309 | ||||||||
Comprehensive income (loss)
|
$ | (1,477 | ) | $ | (4,170 | ) | $ | 4,915 | ||||
80
Accumulated
|
||||||||||||||||||||||||||||||||
Additional
|
Other
|
Total
|
||||||||||||||||||||||||||||||
Preferred
|
Common Stock |
Paid-In
|
Retained
|
Comprehensive
|
Treasury
|
Stockholders’
|
||||||||||||||||||||||||||
Stock | Shares | Amount | Capital | Earnings | Income | Stock | Equity | |||||||||||||||||||||||||
(In millions) | ||||||||||||||||||||||||||||||||
Balance as of December 31, 2006
|
$ | 1 | 444 | $ | 44 | $ | 6,840 | $ | 9,114 | $ | 1,444 | $ | (1 | ) | $ | 17,442 | ||||||||||||||||
Net earnings (loss)
|
— | — | — | — | 3,606 | — | — | 3,606 | ||||||||||||||||||||||||
Other comprehensive earnings (loss), net of tax
|
— | — | — | — | — | 1,309 | — | 1,309 | ||||||||||||||||||||||||
Other financial instruments
|
— | — | — | — | 364 | (364 | ) | — | — | |||||||||||||||||||||||
Uncertain income tax positions
|
— | — | — | — | (11 | ) | — | — | (11 | ) | ||||||||||||||||||||||
Pension and postretirement benefit plans
|
— | — | — | — | (1 | ) | 16 | — | 15 | |||||||||||||||||||||||
Stock option exercises
|
— | 3 | 1 | 90 | — | — | — | 91 | ||||||||||||||||||||||||
Restricted stock grants, net of cancellations
|
— | 2 | — | — | — | — | — | — | ||||||||||||||||||||||||
Common stock repurchased
|
— | (5 | ) | — | — | — | — | (362 | ) | (362 | ) | |||||||||||||||||||||
Common stock retired
|
— | — | (1 | ) | (362 | ) | — | — | 363 | — | ||||||||||||||||||||||
Common stock dividends
|
— | — | — | — | (249 | ) | — | — | (249 | ) | ||||||||||||||||||||||
Preferred stock dividends
|
— | — | — | — | (10 | ) | — | — | (10 | ) | ||||||||||||||||||||||
Share-based compensation
|
— | — | — | 131 | — | — | — | 131 | ||||||||||||||||||||||||
Share-based compensation tax benefits
|
— | — | — | 44 | — | — | — | 44 | ||||||||||||||||||||||||
Balance as of December 31, 2007
|
1 | 444 | 44 | 6,743 | 12,813 | 2,405 | — | 22,006 | ||||||||||||||||||||||||
Net earnings (loss)
|
— | — | — | — | (2,148 | ) | — | — | (2,148 | ) | ||||||||||||||||||||||
Other comprehensive earnings (loss), net of tax
|
— | — | — | — | — | (2,022 | ) | — | (2,022 | ) | ||||||||||||||||||||||
Stock option exercises
|
— | 4 | 1 | 123 | — | — | (8 | ) | 116 | |||||||||||||||||||||||
Restricted stock grants, net of cancellations
|
— | 3 | — | — | — | — | — | — | ||||||||||||||||||||||||
Common stock repurchased
|
— | (7 | ) | — | — | — | — | (709 | ) | (709 | ) | |||||||||||||||||||||
Common stock retired
|
— | — | (1 | ) | (716 | ) | — | — | 717 | — | ||||||||||||||||||||||
Redemption of preferred stock
|
(1 | ) | — | — | (149 | ) | — | — | — | (150 | ) | |||||||||||||||||||||
Common stock dividends
|
— | — | — | — | (284 | ) | — | — | (284 | ) | ||||||||||||||||||||||
Preferred stock dividends
|
— | — | — | — | (5 | ) | — | — | (5 | ) | ||||||||||||||||||||||
Share-based compensation
|
— | — | — | 196 | — | — | — | 196 | ||||||||||||||||||||||||
Share-based compensation tax benefits
|
— | — | — | 60 | — | — | — | 60 | ||||||||||||||||||||||||
Balance as of December 31, 2008
|
$ | — | 444 | 44 | 6,257 | 10,376 | 383 | — | 17,060 | |||||||||||||||||||||||
Net earnings (loss)
|
— | — | — | (2,479 | ) | — | — | (2,479 | ) | |||||||||||||||||||||||
Other comprehensive earnings (loss), net of tax
|
— | — | — | — | 1,002 | — | 1,002 | |||||||||||||||||||||||||
Stock option exercises
|
1 | 1 | 47 | — | — | (5 | ) | 43 | ||||||||||||||||||||||||
Restricted stock grants, net of cancellations
|
2 | — | — | — | — | — | — | |||||||||||||||||||||||||
Common stock repurchased
|
— | — | — | — | — | (40 | ) | (40 | ) | |||||||||||||||||||||||
Common stock retired
|
— | — | (45 | ) | — | — | 45 | — | ||||||||||||||||||||||||
Common stock dividends
|
— | — | — | (284 | ) | — | — | (284 | ) | |||||||||||||||||||||||
Share-based compensation
|
— | — | 260 | — | — | — | 260 | |||||||||||||||||||||||||
Share-based compensation tax benefits
|
— | — | 8 | — | — | — | 8 | |||||||||||||||||||||||||
— | — | — | — | — | — | — | ||||||||||||||||||||||||||
Balance as of December 31, 2009
|
447 | $ | 45 | $ | 6,527 | $ | 7,613 | $ | 1,385 | $ | — | $ | 15,570 | |||||||||||||||||||
81
Year Ended December 31, | ||||||||||||
2009 | 2008 | 2007 | ||||||||||
(In millions) | ||||||||||||
Cash flows from operating activities:
|
||||||||||||
Net earnings (loss)
|
$ | (2,479 | ) | $ | (2,148 | ) | $ | 3,606 | ||||
Net earnings from discontinued operations
|
(274 | ) | (891 | ) | (1,121 | ) | ||||||
Adjustments to reconcile earnings (loss) from continuing
operations
|
||||||||||||
to net cash provided by operating activities:
|
||||||||||||
Depreciation, depletion and amortization
|
2,108 | 3,203 | 2,613 | |||||||||
Deferred income tax expense (benefit)
|
(2,014 | ) | (1,562 | ) | 607 | |||||||
Reduction of carrying value of oil and gas properties
|
6,408 | 9,891 | — | |||||||||
Net unrealized loss (gain) on oil and gas derivative financial
instruments
|
121 | (243 | ) | 26 | ||||||||
Other noncash charges
|
222 | 410 | 150 | |||||||||
Net decrease (increase) in working capital
|
149 | (207 | ) | (512 | ) | |||||||
Decrease (increase) in long-term other assets
|
(6 | ) | (53 | ) | (60 | ) | ||||||
Increase (decrease) in long-term other liabilities
|
(3 | ) | 48 | (1 | ) | |||||||
Cash provided by operating activities — continuing
operations
|
4,232 | 8,448 | 5,308 | |||||||||
Cash provided by operating activities — discontinued
operations
|
505 | 960 | 1,343 | |||||||||
Net cash provided by operating activities
|
4,737 | 9,408 | 6,651 | |||||||||
Cash flows from investing activities:
|
||||||||||||
Proceeds from sales of property and equipment
|
34 | 117 | 76 | |||||||||
Capital expenditures
|
(4,879 | ) | (8,843 | ) | (5,710 | ) | ||||||
Proceeds from exchange of Chevron Corporation common stock
|
— | 280 | — | |||||||||
Purchases of short-term investments
|
— | (50 | ) | (934 | ) | |||||||
Sales of long-term and short-term investments
|
7 | 300 | 1,136 | |||||||||
Other
|
(17 | ) | — | — | ||||||||
Cash used in investing activities — continuing
operations
|
(4,855 | ) | (8,196 | ) | (5,432 | ) | ||||||
Cash provided by (used in) investing activities —
discontinued operations
|
(499 | ) | 1,323 | (282 | ) | |||||||
Net cash used in investing activities
|
(5,354 | ) | (6,873 | ) | (5,714 | ) | ||||||
Cash flows from financing activities:
|
||||||||||||
Proceeds from borrowings of long-term debt, net of issuance costs
|
1,187 | — | — | |||||||||
Credit facility repayments
|
— | (3,191 | ) | (757 | ) | |||||||
Credit facility borrowings
|
— | 1,741 | 2,207 | |||||||||
Net commercial paper borrowings (repayments)
|
426 | 1 | (804 | ) | ||||||||
Debt repayments
|
(178 | ) | (1,031 | ) | (567 | ) | ||||||
Redemption of preferred stock
|
— | (150 | ) | — | ||||||||
Proceeds from stock option exercises
|
42 | 116 | 91 | |||||||||
Repurchases of common stock
|
— | (665 | ) | (326 | ) | |||||||
Dividends paid on common and preferred stock
|
(284 | ) | (289 | ) | (259 | ) | ||||||
Excess tax benefits related to share-based compensation
|
8 | 60 | 44 | |||||||||
Net cash provided by (used in) financing activities
|
1,201 | (3,408 | ) | (371 | ) | |||||||
Effect of exchange rate changes on cash
|
43 | (116 | ) | 51 | ||||||||
Net increase (decrease) in cash and cash equivalents
|
627 | (989 | ) | 617 | ||||||||
Cash and cash equivalents at beginning of period (including cash
related to assets held for sale)
|
384 | 1,373 | 756 | |||||||||
Cash and cash equivalents at end of period (including cash
related to assets held for sale)
|
$ | 1,011 | $ | 384 | $ | 1,373 | ||||||
82
1. | Summary of Significant Accounting Policies |
• | the Mid-Continent area of the central and southern United States, principally in north and east Texas, as well as Oklahoma; | |
• | the Permian Basin within Texas and New Mexico; | |
• | the Rocky Mountains area of the United States stretching from the Canadian border into northern New Mexico; | |
• | the onshore areas of the Gulf Coast, principally in south Texas and south Louisiana; and | |
• | the provinces of Alberta, British Columbia and Saskatchewan in Canada. |
• | estimates of proved reserves and related estimates of the present value of future net revenues; | |
• | the carrying value of oil and gas properties; | |
• | estimates of the fair value of reporting units and related assessment of goodwill for impairment; | |
• | asset retirement obligations; | |
• | income taxes; | |
• | derivative financial instruments; |
83
• | obligations related to employee pension and postretirement benefits; and | |
• | legal and environmental risks and exposures. |
84
85
86
87
December 31, | ||||||||
2009 | 2008 | |||||||
(In millions) | ||||||||
United States
|
$ | 3,046 | $ | 3,046 | ||||
Canada
|
2,884 | 2,465 | ||||||
Total (continuing operations)
|
$ | 5,930 | $ | 5,511 | ||||
International (assets held for sale)
|
$ | 68 | $ | 68 | ||||
December 31, 2006
|
$ | 1,219 | ||
December 31, 2007
|
$ | 2,566 | ||
December 31, 2008
|
$ | 685 | ||
December 31, 2009
|
$ | 1,616 |
88
89
2. | Accounts Receivable |
December 31, | ||||||||
2009 | 2008 | |||||||
(In millions) | ||||||||
Oil, gas and NGL revenues
|
$ | 752 | $ | 711 | ||||
Joint interest billings
|
151 | 241 | ||||||
Marketing and midstream revenues
|
188 | 153 | ||||||
Production tax credits
|
110 | 170 | ||||||
Other
|
19 | 30 | ||||||
Gross accounts receivable
|
1,220 | 1,305 | ||||||
Allowance for doubtful accounts
|
(12 | ) | (5 | ) | ||||
Net accounts receivable
|
$ | 1,208 | $ | 1,300 | ||||
3. | Derivative Financial Instruments |
90
Asset
|
Liability
|
|||||||||
Balance Sheet Caption
|
Derivatives | Derivatives | ||||||||
(In millions) | ||||||||||
December 31, 2009:
|
||||||||||
Gas price swaps
|
Derivative financial instruments, current | $ | 169 | $ | — | |||||
Gas basis swaps
|
Derivative financial instruments, current | 3 | — | |||||||
Oil price collars
|
Other current liabilities | — | 38 | |||||||
Interest rate swaps
|
Derivative financial instruments, current | 39 | — | |||||||
Interest rate swaps
|
Other long-term assets | 131 | — | |||||||
Total derivatives
|
$ | 342 | $ | 38 | ||||||
December 31, 2008:
|
||||||||||
Gas price collars
|
Derivative financial instruments, current | $ | 255 | $ | — | |||||
Interest rate swaps
|
Derivative financial instruments, current | 27 | — | |||||||
Interest rate swaps
|
Other long-term assets | 77 | — | |||||||
Total derivatives
|
$ | 359 | $ | — | ||||||
Statement of Operations Caption
|
2009 | 2008 | 2007 | |||||||||||
(In millions) | ||||||||||||||
Cash settlements:
|
||||||||||||||
Gas price collars
|
Net gain (loss) on oil and gas derivative financial instruments | $ | 450 | $ | (221 | ) | $ | 2 | ||||||
Gas price swaps
|
Net gain (loss) on oil and gas derivative financial instruments | 55 | (203 | ) | 38 | |||||||||
Oil price collars
|
Net gain (loss) on oil and gas derivative financial instruments | — | 27 | — | ||||||||||
Interest rate swaps
|
Change in fair value of other financial instruments | 40 | 1 | — | ||||||||||
Total cash settlements
|
545 | (396 | ) | 40 | ||||||||||
Unrealized (losses) gains:
|
||||||||||||||
Gas price collars
|
Net gain (loss) on oil and gas derivative financial instruments | (255 | ) | 255 | (4 | ) | ||||||||
Gas price swaps
|
Net gain (loss) on oil and gas derivative financial instruments | 169 | (12 | ) | (22 | ) | ||||||||
Gas basis swaps
|
Net gain (loss) on oil and gas derivative financial instruments | 3 | — | — | ||||||||||
Oil price collars
|
Net gain (loss) on oil and gas derivative financial instruments | (38 | ) | — | — | |||||||||
Interest rate swaps
|
Change in fair value of other financial instruments | 66 | 104 | 1 | ||||||||||
Embedded option
|
Change in fair value of other financial instruments | — | 109 | (248 | ) | |||||||||
Total unrealized (losses) gains
|
(55 | ) | 456 | (273 | ) | |||||||||
Net gain (loss) recognized on statement of operations
|
$ | 490 | $ | 60 | $ | (233 | ) | |||||||
91
4. | Other Current Assets |
December 31, | ||||||||
2009 | 2008 | |||||||
(In millions) | ||||||||
Inventories
|
$ | 182 | $ | 142 | ||||
Prepaid assets
|
33 | 36 | ||||||
Income taxes receivable
|
53 | 333 | ||||||
Other
|
2 | 4 | ||||||
Other current assets
|
$ | 270 | $ | 515 | ||||
5. | Property and Equipment |
December 31, | ||||||||
2009 | 2008 | |||||||
(In millions) | ||||||||
Oil and gas properties:
|
||||||||
Subject to amortization
|
$ | 52,352 | $ | 45,678 | ||||
Not subject to amortization
|
4,078 | 4,248 | ||||||
Total
|
56,430 | 49,926 | ||||||
Accumulated depreciation, depletion and amortization
|
(40,312 | ) | (30,260 | ) | ||||
Net oil and gas properties
|
16,118 | 19,666 | ||||||
Other property and equipment
|
4,045 | 3,465 | ||||||
Accumulated depreciation and amortization
|
(1,396 | ) | (1,100 | ) | ||||
Net other property and equipment
|
2,649 | 2,365 | ||||||
Property and equipment, net of accumulated depreciation,
depletion and amortization
|
$ | 18,767 | $ | 22,031 | ||||
92
Costs Incurred In | ||||||||||||||||||||
Prior to
|
||||||||||||||||||||
2009 | 2008 | 2007 | 2007 | Total | ||||||||||||||||
(In millions) | ||||||||||||||||||||
Acquisition costs
|
$ | 129 | $ | 1,567 | $ | 126 | $ | 780 | $ | 2,602 | ||||||||||
Exploration costs
|
223 | 303 | 56 | 174 | 756 | |||||||||||||||
Development costs
|
326 | 169 | 34 | 22 | 551 | |||||||||||||||
Capitalized interest
|
74 | 54 | 37 | 4 | 169 | |||||||||||||||
Total oil and gas properties not subject to amortization
|
$ | 752 | $ | 2,093 | $ | 253 | $ | 980 | $ | 4,078 | ||||||||||
6. | Debt and Related Expenses |
December 31, | ||||||||
2009 | 2008 | |||||||
(In millions) | ||||||||
Commercial paper
|
$ | 1,432 | $ | 1,005 | ||||
Other debentures and notes:
|
||||||||
10.125% retired on November 15, 2009
|
— | 177 | ||||||
6.875% due September 30, 2011
|
1,750 | 1,750 | ||||||
7.25% due October 1, 2011
|
350 | 350 | ||||||
5.625% due January 15, 2014
|
500 | — | ||||||
8.25% due July 1, 2018
|
125 | 125 | ||||||
6.30% due January 15, 2019
|
700 | — | ||||||
7.50% due September 15, 2027
|
150 | 150 | ||||||
7.875% due September 30, 2031
|
1,250 | 1,250 | ||||||
7.95% due April 15, 2032
|
1,000 | 1,000 | ||||||
Other
|
10 | 10 | ||||||
Net premium on other debentures and notes
|
12 | 24 | ||||||
7,279 | 5,841 | |||||||
Less amount classified as short-term debt
|
1,432 | 180 | ||||||
Long-term debt
|
$ | 5,847 | $ | 5,661 | ||||
93
2010
|
$ | 1,432 | ||
2011
|
2,100 | |||
2012
|
10 | |||
2013
|
— | |||
2014
|
500 | |||
2015 and thereafter
|
3,225 | |||
Total
|
$ | 7,267 | ||
94
Senior Credit Facility:
|
||||
April 7, 2012 maturity
|
$ | 500 | ||
April 7, 2013 maturity
|
2,150 | |||
Total Senior Credit Facility
|
2,650 | |||
Short-Term Facility — November 2, 2010 maturity
|
700 | |||
Total credit facilities
|
3,350 | |||
Less:
|
||||
Outstanding credit facility borrowings
|
— | |||
Outstanding commercial paper borrowings
|
1,432 | |||
Outstanding letters of credit
|
87 | |||
Total available capacity
|
$ | 1,831 | ||
Fair Value of
|
Effective Rate of
|
|||||||
Debt Assumed
|
Debt Assumed | Debt Assumed | ||||||
(In millions) | ||||||||
7.250% due October 2011 (principal of $350 million)
|
$ | 406 | 4.9 | % | ||||
8.250% due July 2018 (principal of $125 million)
|
$ | 147 | 5.5 | % | ||||
7.500% due September 2027 (principal of $150 million)
|
$ | 169 | 6.5 | % |
95
Year Ended December 31, | ||||||||||||
2009 | 2008 | 2007 | ||||||||||
(In millions) | ||||||||||||
Interest based on debt outstanding
|
$ | 437 | $ | 426 | $ | 508 | ||||||
Capitalized interest
|
(94 | ) | (111 | ) | (102 | ) | ||||||
Other
|
6 | 14 | 24 | |||||||||
Total interest expense
|
$ | 349 | $ | 329 | $ | 430 | ||||||
96
7. | Asset Retirement Obligations |
Year Ended
|
||||||||
December 31, | ||||||||
2009 | 2008 | |||||||
(In millions) | ||||||||
Asset retirement obligations as of beginning of year
|
$ | 1,387 | $ | 1,245 | ||||
Liabilities incurred
|
56 | 59 | ||||||
Liabilities settled
|
(123 | ) | (86 | ) | ||||
Revision of estimated obligation
|
33 | 225 | ||||||
Liabilities assumed by others
|
(30 | ) | — | |||||
Accretion expense on discounted obligation
|
91 | 80 | ||||||
Foreign currency translation adjustment
|
99 | (136 | ) | |||||
Asset retirement obligations as of end of year
|
1,513 | 1,387 | ||||||
Less current portion
|
95 | 138 | ||||||
Asset retirement obligations, long-term
|
$ | 1,418 | $ | 1,249 | ||||
8. | Retirement Plans |
97
98
Other
|
||||||||||||||||
Pension
|
Postretirement
|
|||||||||||||||
Benefits | Benefits | |||||||||||||||
2009 | 2008 | 2009 | 2008 | |||||||||||||
(In millions) | ||||||||||||||||
Change in benefit obligation:
|
||||||||||||||||
Benefit obligation at beginning of year
|
$ | 931 | $ | 849 | $ | 56 | $ | 71 | ||||||||
Service cost
|
43 | 41 | 1 | 1 | ||||||||||||
Interest cost
|
58 | 54 | 3 | 4 | ||||||||||||
Actuarial loss (gain)
|
4 | 17 | 7 | (15 | ) | |||||||||||
Curtailment (gain) loss
|
(26 | ) | — | 1 | — | |||||||||||
Plan amendments
|
— | 9 | — | — | ||||||||||||
Foreign exchange rate changes
|
5 | (6 | ) | — | — | |||||||||||
Participant contributions
|
— | — | 2 | 2 | ||||||||||||
Benefits paid
|
(35 | ) | (33 | ) | (6 | ) | (7 | ) | ||||||||
Benefit obligation at end of year
|
980 | 931 | 64 | 56 | ||||||||||||
Change in plan assets:
|
||||||||||||||||
Fair value of plan assets at beginning of year
|
430 | 619 | — | — | ||||||||||||
Actual return on plan assets
|
80 | (178 | ) | — | — | |||||||||||
Employer contributions
|
55 | 25 | 4 | 5 | ||||||||||||
Participant contributions
|
— | — | 2 | 2 | ||||||||||||
Benefits paid
|
(35 | ) | (33 | ) | (6 | ) | (7 | ) | ||||||||
Foreign exchange rate changes
|
2 | (3 | ) | — | — | |||||||||||
Fair value of plan assets at end of year
|
532 | 430 | — | — | ||||||||||||
Funded status at end of year
|
$ | (448 | ) | $ | (501 | ) | $ | (64 | ) | $ | (56 | ) | ||||
Amounts recognized in balance sheet:
|
||||||||||||||||
Noncurrent assets
|
$ | 2 | $ | 2 | $ | — | $ | — | ||||||||
Current liabilities
|
(8 | ) | (10 | ) | (5 | ) | (5 | ) | ||||||||
Noncurrent liabilities
|
(442 | ) | (493 | ) | (59 | ) | (51 | ) | ||||||||
Net amount
|
$ | (448 | ) | $ | (501 | ) | $ | (64 | ) | $ | (56 | ) | ||||
Amounts recognized in accumulated other comprehensive income:
|
||||||||||||||||
Net actuarial loss (gain)
|
$ | 334 | $ | 440 | $ | (6 | ) | $ | (13 | ) | ||||||
Prior service cost
|
20 | 28 | 11 | 13 | ||||||||||||
Total
|
$ | 354 | $ | 468 | $ | 5 | $ | — | ||||||||
99
December 31, | ||||||||
2009 | 2008 | |||||||
(In millions) | ||||||||
Projected benefit obligation
|
$ | 967 | $ | 921 | ||||
Accumulated benefit obligation
|
$ | 860 | $ | 784 | ||||
Fair value of plan assets
|
$ | 517 | $ | 417 |
Other
|
||||||||||||||||||||||||
Pension Benefits | Postretirement Benefits | |||||||||||||||||||||||
2009 | 2008 | 2007 | 2009 | 2008 | 2007 | |||||||||||||||||||
(In millions) | ||||||||||||||||||||||||
Net periodic benefit cost:
|
||||||||||||||||||||||||
Service cost
|
$ | 43 | $ | 41 | $ | 30 | $ | 1 | $ | 1 | $ | 1 | ||||||||||||
Interest cost
|
58 | 54 | 46 | 3 | 4 | 3 | ||||||||||||||||||
Expected return on plan assets
|
(35 | ) | (50 | ) | (49 | ) | — | — | — | |||||||||||||||
Curtailment and settlement expense
|
5 | — | 1 | 1 | — | — | ||||||||||||||||||
Plan amendment
|
— | — | — | — | — | 1 | ||||||||||||||||||
Recognition of net actuarial loss (gain)
|
45 | 14 | 12 | (1 | ) | — | 1 | |||||||||||||||||
Recognition of prior service cost
|
3 | 2 | 1 | 2 | 2 | — | ||||||||||||||||||
Total net periodic benefit cost
|
119 | 61 | 41 | 6 | 7 | 6 | ||||||||||||||||||
Other comprehensive income
|
||||||||||||||||||||||||
Actuarial (gain) loss arising in current year
|
(66 | ) | 245 | 54 | 7 | (15 | ) | (3 | ) | |||||||||||||||
Prior service cost arising in current year
|
— | 9 | 17 | — | — | 22 | ||||||||||||||||||
Recognition of net actuarial (loss) gain in net periodic benefit
cost
|
(45 | ) | (14 | ) | (12 | ) | 1 | — | (1 | ) | ||||||||||||||
Recognition of prior service cost, including curtailment, in net
periodic benefit cost
|
(8 | ) | (2 | ) | (1 | ) | (2 | ) | (2 | ) | — | |||||||||||||
Curtailment of pension benefits
|
— | — | (16 | ) | — | — | — | |||||||||||||||||
Change in additional minimum pension liability
|
— | — | — | — | — | — | ||||||||||||||||||
Total other comprehensive income (loss)
|
(119 | ) | 238 | 42 | 6 | (17 | ) | 18 | ||||||||||||||||
Total recognized
|
$ | — | $ | 299 | $ | 83 | $ | 12 | $ | (10 | ) | $ | 24 | |||||||||||
100
Other
|
||||||||
Pension
|
Postretirement
|
|||||||
Benefits | Benefits | |||||||
(In millions) | ||||||||
Net actuarial loss
|
$ | 27 | $ | — | ||||
Prior service cost
|
3 | 1 | ||||||
Total
|
$ | 30 | $ | 1 | ||||
Other
|
||||||||||||||||||||||||
Pension Benefits | Postretirement Benefits | |||||||||||||||||||||||
2009 | 2008 | 2007 | 2009 | 2008 | 2007 | |||||||||||||||||||
Assumptions to determine benefit obligations:
|
||||||||||||||||||||||||
Discount rate
|
6.00 | % | 6.00 | % | 6.22 | % | 5.70 | % | 6.00 | % | 6.00 | % | ||||||||||||
Rate of compensation increase
|
6.95 | % | 7.00 | % | 7.00 | % | N/A | N/A | N/A | |||||||||||||||
Assumptions to determine net periodic benefit cost:
|
||||||||||||||||||||||||
Discount rate
|
6.00 | % | 6.18 | % | 5.96 | % | 6.00 | % | 6.00 | % | 5.75 | % | ||||||||||||
Expected return on plan assets
|
7.18 | % | 8.40 | % | 8.40 | % | N/A | N/A | N/A | |||||||||||||||
Rate of compensation increase
|
6.95 | % | 7.00 | % | 7.00 | % | N/A | N/A | N/A |
101
One
|
One
|
|||||||
Percent
|
Percent
|
|||||||
Increase | Decrease | |||||||
(In millions) | ||||||||
Effect on benefit obligation
|
$ | 5 | $ | (4 | ) | |||
Effect on service and interest costs
|
$ | — | $ | — |
As of December 31, 2009 | ||||||||||||||||||||
Fair Value Measurements Using: | ||||||||||||||||||||
Significant
|
||||||||||||||||||||
Quoted Prices
|
Other
|
Significant
|
||||||||||||||||||
in Active
|
Observable
|
Unobservable
|
||||||||||||||||||
Actual
|
Markets
|
Inputs
|
Inputs
|
|||||||||||||||||
Allocation | Total | (Level 1) | (Level 2) | (Level 3) | ||||||||||||||||
(In millions) | ||||||||||||||||||||
Equity securities:
|
||||||||||||||||||||
United States large cap
|
18.8 | % | $ | 100 | $ | — | $ | 100 | $ | — | ||||||||||
United States small cap
|
15.2 | % | 81 | 81 | — | — | ||||||||||||||
International large cap
|
15.2 | % | 81 | 44 | 37 | — | ||||||||||||||
Total equity securities
|
49.2 | % | 262 | 125 | 137 | — | ||||||||||||||
Fixed-income securities:
|
||||||||||||||||||||
Corporate bonds
|
25.1 | % | 133 | 133 | — | — | ||||||||||||||
United States Treasury obligations
|
9.8 | % | 52 | 52 | — | — | ||||||||||||||
Other bonds
|
3.9 | % | 21 | 21 | — | — | ||||||||||||||
Total fixed-income securities
|
38.8 | % | 206 | 206 | — | — | ||||||||||||||
Other securities:
|
||||||||||||||||||||
Short-term investment funds
|
2.4 | % | 13 | — | 13 | — | ||||||||||||||
Hedge funds
|
9.6 | % | 51 | — | — | 51 | ||||||||||||||
Total other securities
|
12.0 | % | 64 | 13 | 51 | |||||||||||||||
Total investments
|
100.0 | % | $ | 532 | $ | 331 | $ | 150 | $ | 51 | ||||||||||
102
As of December 31, 2008 | ||||||||||||||||||||
Fair Value Measurements Using: | ||||||||||||||||||||
Significant
|
||||||||||||||||||||
Quoted Prices
|
Other
|
Significant
|
||||||||||||||||||
in Active
|
Observable
|
Unobservable
|
||||||||||||||||||
Actual
|
Markets
|
Inputs
|
Inputs
|
|||||||||||||||||
Allocation | Total | (Level 1) | (Level 2) | (Level 3) | ||||||||||||||||
(In millions) | ||||||||||||||||||||
Equity securities:
|
||||||||||||||||||||
United States large cap
|
25.8 | % | $ | 111 | $ | — | $ | 111 | $ | — | ||||||||||
United States small cap
|
14.9 | % | 64 | 64 | — | — | ||||||||||||||
International large cap
|
14.0 | % | 60 | 34 | 26 | — | ||||||||||||||
Total equity securities
|
54.7 | % | 235 | 98 | 137 | — | ||||||||||||||
Fixed-income securities:
|
||||||||||||||||||||
Corporate bonds
|
29.1 | % | 125 | 125 | — | — | ||||||||||||||
United States Treasury obligations
|
8.8 | % | 38 | 38 | — | — | ||||||||||||||
Other bonds
|
3.0 | % | 13 | 13 | — | — | ||||||||||||||
Total fixed-income securities
|
40.9 | % | 176 | 176 | — | — | ||||||||||||||
Other securities — Short-term investment funds
|
4.4 | % | 19 | — | 19 | — | ||||||||||||||
Total investments
|
100.0 | % | $ | 430 | $ | 274 | $ | 156 | $ | — | ||||||||||
103
Other
|
||||||||
Pension
|
Postretirement
|
|||||||
Benefits | Benefits | |||||||
(In millions) | ||||||||
Devon’s 2010 contributions
|
$ | 34 | $ | 5 | ||||
Benefit payments:
|
||||||||
2010
|
$ | 39 | $ | 5 | ||||
2011
|
$ | 41 | $ | 5 | ||||
2012
|
$ | 45 | $ | 6 | ||||
2013
|
$ | 49 | $ | 6 | ||||
2014
|
$ | 53 | $ | 6 | ||||
2015 to 2019
|
$ | 338 | $ | 29 |
104
Year Ended December 31, | ||||||||||||
2009 | 2008 | 2007 | ||||||||||
(In millions) | ||||||||||||
401(k) plan
|
$ | 20 | $ | 21 | $ | 18 | ||||||
Enhanced contribution plan
|
14 | 12 | — | |||||||||
Canadian pension and savings plans
|
15 | 16 | 14 | |||||||||
Total expense
|
$ | 49 | $ | 49 | $ | 32 | ||||||
9. | Stockholders’ Equity |
105
2008 | 2007 | |||||||||||||||||||||||
Repurchase Program
|
Amount | Shares | Per Share | Amount | Shares | Per Share | ||||||||||||||||||
Annual program
|
$ | 178 | 2.0 | $ | 87.83 | $ | — | — | $ | — | ||||||||||||||
2007 program
|
487 | 4.5 | $ | 109.25 | 326 | 4.1 | $ | 79.80 | ||||||||||||||||
Totals
|
$ | 665 | 6.5 | $ | 102.56 | $ | 326 | 4.1 | $ | 79.80 | ||||||||||||||
10. | Commitments and Contingencies |
106
107
108
Drilling
|
||||||||||||||||||||
and
|
Firm
|
Office and
|
||||||||||||||||||
Facility
|
Transportation
|
Equipment
|
Spar
|
FPSO
|
||||||||||||||||
Year Ending December 31,
|
Obligations | Agreements | Leases | Leases | Leases | |||||||||||||||
(In millions) | ||||||||||||||||||||
Continuing operations:
|
||||||||||||||||||||
2010
|
$ | 992 | $ | 298 | $ | 57 | $ | 11 | $ | 58 | ||||||||||
2011
|
516 | 267 | 54 | 11 | 37 | |||||||||||||||
2012
|
302 | 241 | 40 | 22 | 38 | |||||||||||||||
2013
|
257 | 217 | 34 | 13 | 38 | |||||||||||||||
2014
|
97 | 202 | 15 | 27 | 38 | |||||||||||||||
Thereafter
|
1 | 714 | 147 | 78 | 16 | |||||||||||||||
Total
|
2,165 | 1,939 | 347 | 162 | 225 | |||||||||||||||
Discontinued operations:
|
||||||||||||||||||||
2010
|
622 | — | 15 | — | 37 | |||||||||||||||
2011
|
182 | — | — | — | 37 | |||||||||||||||
2012
|
170 | — | — | — | 37 | |||||||||||||||
2013
|
110 | — | — | — | 37 | |||||||||||||||
2014
|
— | — | — | — | 23 | |||||||||||||||
Thereafter
|
— | — | — | — | 29 | |||||||||||||||
Total
|
1,084 | — | 15 | — | 200 | |||||||||||||||
Total operations
|
$ | 3,249 | $ | 1,939 | $ | 362 | $ | 162 | $ | 425 | ||||||||||
11. | Fair Value Measurements |
109
As of December 31, 2009 | ||||||||||||||||||||
Fair Value Measurements Using: | ||||||||||||||||||||
Significant
|
||||||||||||||||||||
Quoted Prices
|
Other
|
Significant
|
||||||||||||||||||
in Active
|
Observable
|
Unobservable
|
||||||||||||||||||
Carrying
|
Total
|
Markets
|
Inputs
|
Inputs
|
||||||||||||||||
Amount | Fair Value | (Level 1) | (Level 2) | (Level 3) | ||||||||||||||||
(In millions) | ||||||||||||||||||||
Financial assets (liabilities):
|
||||||||||||||||||||
Gas price swaps
|
$ | 169 | $ | 169 | $ | — | $ | 169 | $ | — | ||||||||||
Gas basis swaps
|
$ | 3 | $ | 3 | $ | — | $ | 3 | $ | — | ||||||||||
Oil price collars
|
$ | (38 | ) | $ | (38 | ) | $ | — | $ | (38 | ) | $ | — | |||||||
Interest rate swaps
|
$ | 170 | $ | 170 | $ | — | $ | 170 | $ | — | ||||||||||
Debt
|
$ | (7,279 | ) | $ | (8,214 | ) | $ | (1,432 | ) | $ | (6,782 | ) | $ | — | ||||||
Long-term investments
|
$ | 115 | $ | 115 | $ | — | $ | — | $ | 115 | ||||||||||
Asset retirement obligations(1)
|
$ | (1,622 | ) | $ | (1,622 | ) | $ | — | $ | — | $ | (1,622 | ) |
As of December 31, 2008 | ||||||||||||||||||||
Fair Value Measurements Using: | ||||||||||||||||||||
Significant
|
||||||||||||||||||||
Quoted Prices
|
Other
|
Significant
|
||||||||||||||||||
in Active
|
Observable
|
Unobservable
|
||||||||||||||||||
Carrying
|
Total
|
Markets
|
Inputs
|
Inputs
|
||||||||||||||||
Amount | Fair Value | (Level 1) | (Level 2) | (Level 3) | ||||||||||||||||
(In millions) | ||||||||||||||||||||
Financial assets (liabilities):
|
||||||||||||||||||||
Gas price collars
|
$ | 255 | $ | 255 | $ | — | $ | 255 | $ | — | ||||||||||
Interest rate swaps
|
$ | 104 | $ | 104 | $ | — | $ | 104 | $ | — | ||||||||||
Debt
|
$ | (5,841 | ) | $ | (6,106 | ) | $ | (1,005 | ) | $ | (5,101 | ) | $ | — | ||||||
Long-term investments
|
$ | 122 | $ | 122 | $ | — | $ | — | $ | 122 | ||||||||||
Asset retirement obligations(1)
|
$ | (1,485 | ) | $ | (1,485 | ) | $ | — | $ | — | $ | (1,485 | ) |
(1) | Includes $109 million and $98 million of asset retirement obligations related to Devon’s discontinued operations at December 31, 2009 and 2008, respectively. |
110
12. | Share-Based Compensation |
111
2009 | 2008 | 2007 | ||||||||||
(In millions) | ||||||||||||
Gross general and administrative expense
|
$ | 209 | $ | 212 | $ | 146 | ||||||
Share-based compensation expense capitalized pursuant to the
full cost method of accounting for oil and gas properties
|
$ | 66 | $ | 54 | $ | 44 | ||||||
Related income tax benefit
|
$ | 43 | $ | 47 | $ | 28 |
112
2009 | 2008 | 2007 | ||||||||||
Grant-date fair value
|
$ | 22.85 | $ | 21.77 | $ | 26.43 | ||||||
Volatility factor
|
47.7 | % | 44.3 | % | 31.6 | % | ||||||
Dividend yield
|
0.9 | % | 0.9 | % | 0.7 | % | ||||||
Risk-free interest rate
|
2.1 | % | 1.2 | % | 5.0 | % | ||||||
Expected term (in years)
|
4.0 | 3.8 | 4.0 |
Weighted
|
||||||||||||||||
Weighted
|
Average
|
|||||||||||||||
Average
|
Remaining
|
Aggregate
|
||||||||||||||
Exercise
|
Contractual
|
Intrinsic
|
||||||||||||||
Options | Price | Term | Value | |||||||||||||
(In thousands) | (In Years) | (In millions) | ||||||||||||||
Outstanding at December 31, 2008
|
11,894 | $ | 55.16 | |||||||||||||
Granted
|
2,026 | $ | 63.13 | |||||||||||||
Exercised
|
(1,497 | ) | $ | 31.27 | ||||||||||||
Forfeited
|
(263 | ) | $ | 71.82 | ||||||||||||
Outstanding at December 31, 2009
|
12,160 | $ | 59.07 | 3.6 | $ | 205 | ||||||||||
Vested and expected to vest at December 31, 2009
|
12,128 | $ | 59.05 | 3.6 | $ | 204 | ||||||||||
Exercisable at December 31, 2009
|
8,371 | $ | 54.74 | 2.8 | $ | 176 | ||||||||||
113
Weighted
|
||||||||
Restricted
|
Average
|
|||||||
Stock
|
Grant-Date
|
|||||||
Awards | Fair Value | |||||||
(In thousands) | ||||||||
Unvested at December 31, 2008
|
6,334 | $ | 72.66 | |||||
Granted
|
2,656 | $ | 63.59 | |||||
Vested
|
(2,679 | ) | $ | 70.16 | ||||
Forfeited
|
(146 | ) | $ | 73.59 | ||||
Unvested at December 31, 2009
|
6,165 | $ | 69.76 | |||||
13. | Restructuring Costs |
14. | Other Financial Instruments |
114
Year Ended December 31, | ||||||||||||
2009 | 2008 | 2007 | ||||||||||
(In millions) | ||||||||||||
(Gains) and losses from:
|
||||||||||||
Interest rate swaps — fair value changes (See
Note 3)
|
$ | (66 | ) | $ | (104 | ) | $ | (1 | ) | |||
Interest rate swaps — settlements (See Note 3)
|
(40 | ) | (1 | ) | — | |||||||
Chevron common stock
|
— | 363 | (281 | ) | ||||||||
Option embedded in exchangeable debentures
|
— | (109 | ) | 248 | ||||||||
Total
|
$ | (106 | ) | $ | 149 | $ | (34 | ) | ||||
15. | Reduction of Carrying Value of Oil and Gas Properties |
Year Ended December 31, | ||||||||||||||||
2009 | 2008 | |||||||||||||||
Net of
|
Net of
|
|||||||||||||||
Gross | Taxes | Gross | Taxes | |||||||||||||
(In millions) | ||||||||||||||||
United States
|
$ | 6,408 | $ | 4,085 | $ | 6,538 | $ | 4,168 | ||||||||
Canada
|
— | — | 3,353 | 2,488 | ||||||||||||
Total
|
$ | 6,408 | $ | 4,085 | $ | 9,891 | $ | 6,656 | ||||||||
115
16. | Other Income |
Year Ended December 31, | ||||||||||||
2009 | 2008 | 2007 | ||||||||||
(In millions) | ||||||||||||
Interest and dividend income
|
$ | 8 | $ | 54 | $ | 48 | ||||||
Reduction of deep water royalties (see Note 10)
|
84 | — | — | |||||||||
Hurricane insurance proceeds (see Note 10)
|
— | 162 | — | |||||||||
Other
|
(24 | ) | 1 | 3 | ||||||||
Total
|
$ | 68 | $ | 217 | $ | 51 | ||||||
17. | Income Taxes |
Year Ended December 31, | ||||||||||||
2009 | 2008 | 2007 | ||||||||||
(In millions) | ||||||||||||
(Loss) earnings from continuing operations before income taxes:
|
||||||||||||
U.S.
|
$ | (4,961 | ) | $ | (2,190 | ) | $ | 2,642 | ||||
Canada
|
435 | (1,970 | ) | 685 | ||||||||
Total
|
$ | (4,526 | ) | $ | (4,160 | ) | $ | 3,327 | ||||
Current income tax expense:
|
||||||||||||
U.S. federal
|
$ | 45 | $ | 258 | $ | 83 | ||||||
Various states
|
18 | 31 | 17 | |||||||||
Canada and various provinces
|
178 | 152 | 135 | |||||||||
Total current tax expense
|
241 | 441 | 235 | |||||||||
Deferred income tax (benefit) expense:
|
||||||||||||
U.S. federal
|
(1,846 | ) | (875 | ) | 745 | |||||||
Various states
|
(111 | ) | (65 | ) | 28 | |||||||
Canada and various provinces
|
(57 | ) | (622 | ) | (166 | ) | ||||||
Total deferred tax (benefit) expense
|
(2,014 | ) | (1,562 | ) | 607 | |||||||
Total income tax (benefit) expense
|
$ | (1,773 | ) | $ | (1,121 | ) | $ | 842 | ||||
116
Year Ended December 31, | ||||||||||||
2009 | 2008 | 2007 | ||||||||||
(In millions) | ||||||||||||
Expected income tax (benefit) expense based on U.S. statutory
tax rate of 35%
|
$ | (1,584 | ) | $ | (1,456 | ) | $ | 1,164 | ||||
State income taxes
|
(99 | ) | (29 | ) | 30 | |||||||
Taxation on Canadian operations
|
(31 | ) | 227 | (10 | ) | |||||||
Repatriations and tax policy election changes
|
— | 312 | — | |||||||||
Canadian statutory rate reduction
|
— | — | (261 | ) | ||||||||
Other
|
(59 | ) | (175 | ) | (81 | ) | ||||||
Total income tax (benefit) expense
|
$ | (1,773 | ) | $ | (1,121 | ) | $ | 842 | ||||
December 31, | ||||||||
2009 | 2008 | |||||||
(In millions) | ||||||||
Deferred tax assets:
|
||||||||
Net operating loss carryforwards
|
$ | 11 | $ | 13 | ||||
Asset retirement obligations
|
474 | 442 | ||||||
Pension benefit obligations
|
130 | 172 | ||||||
Other
|
133 | 74 | ||||||
Total deferred tax assets
|
748 | 701 | ||||||
Deferred tax liabilities:
|
||||||||
Property and equipment, principally due to nontaxable business
combinations, differences in depreciation, and the expensing of
intangible drilling costs for tax purposes
|
(2,315 | ) | (4,163 | ) | ||||
Fair value of financial instruments
|
(108 | ) | (132 | ) | ||||
Long-term debt
|
(162 | ) | (69 | ) | ||||
Other
|
(62 | ) | — | |||||
Total deferred tax liabilities
|
(2,647 | ) | (4,364 | ) | ||||
Net deferred tax liability
|
$ | (1,899 | ) | $ | (3,663 | ) | ||
117
Balance as of December 31, 2008
|
$ | 260 | ||
Increases (decreases) due to:
|
||||
Tax positions taken in current year
|
20 | |||
Accrual of interest related to tax positions taken
|
7 | |||
Lapse of statute of limitations
|
(15 | ) | ||
Settlements
|
(5 | ) | ||
Foreign currency translation
|
5 | |||
Balance as of December 31, 2009
|
$ | 272 | ||
Jurisdiction
|
Tax Years Open | |||
U.S. federal
|
2005-2009 | |||
Various U.S. states
|
2005-2009 | |||
Canada federal
|
2001-2009 | |||
Various Canadian provinces
|
2001-2009 |
118
18. | Discontinued Operations |
Year Ended December 31, | ||||||||||||||||||||||||
2009 | 2008 | 2007 | ||||||||||||||||||||||
Net of
|
Net of
|
Net of
|
||||||||||||||||||||||
Gross | Taxes | Gross | Taxes | Gross | Taxes | |||||||||||||||||||
(In millions) | ||||||||||||||||||||||||
Egypt
|
$ | — | $ | — | $ | — | $ | — | $ | 90 | $ | 90 | ||||||||||||
Equatorial Guinea
|
— | — | 619 | 544 | — | — | ||||||||||||||||||
Gabon
|
— | — | 117 | 122 | — | — | ||||||||||||||||||
Cote d’Ivoire
|
17 | 17 | 83 | 95 | — | — | ||||||||||||||||||
Other
|
— | — | — | 8 | — | — | ||||||||||||||||||
Total
|
$ | 17 | $ | 17 | $ | 819 | $ | 769 | $ | 90 | $ | 90 | ||||||||||||
119
December 31, | ||||||||
2009 | 2008 | |||||||
(In millions) | ||||||||
Assets:
|
||||||||
Cash and cash equivalents
|
$ | 365 | $ | 189 | ||||
Accounts receivable
|
165 | 112 | ||||||
Other current assets
|
127 | 91 | ||||||
Current assets
|
$ | 657 | $ | 392 | ||||
Property and equipment, net of accumulated depreciation,
depletion and amortization
|
$ | 1,099 | $ | 954 | ||||
Goodwill
|
68 | 68 | ||||||
Other long-term assets
|
83 | 106 | ||||||
Total long-term assets
|
$ | 1,250 | $ | 1,128 | ||||
Liabilities:
|
||||||||
Accounts payable
|
$ | 158 | $ | 220 | ||||
Other current liabilities
|
76 | 145 | ||||||
Current liabilities
|
$ | 234 | $ | 365 | ||||
Asset retirement obligations, long-term
|
$ | 109 | $ | 98 | ||||
Deferred income taxes
|
101 | 65 | ||||||
Other liabilities
|
3 | 3 | ||||||
Long-term liabilities
|
$ | 213 | $ | 166 | ||||
Year Ended December 31, | ||||||||||||||||||||||||
2009 | 2008 | 2007 | ||||||||||||||||||||||
Net of
|
Net of
|
Net of
|
||||||||||||||||||||||
Gross | Taxes | Gross | Taxes | Gross | Taxes | |||||||||||||||||||
(In millions) | (In millions) | (In millions) | ||||||||||||||||||||||
Brazil
|
$ | 103 | $ | 103 | $ | 437 | $ | 437 | $ | — | $ | — | ||||||||||||
Nigeria
|
— | — | — | — | 68 | 13 | ||||||||||||||||||
Other
|
5 | 2 | 57 | 28 | — | — | ||||||||||||||||||
Total
|
$ | 108 | $ | 105 | $ | 494 | $ | 465 | $ | 68 | $ | 13 | ||||||||||||
120
19. | (Loss) Earnings Per Share |
(Loss)
|
||||||||||||
(Loss)
|
Common
|
Earnings
|
||||||||||
Earnings | Shares | per Share | ||||||||||
(In millions, except per share amounts) | ||||||||||||
Year Ended December 31, 2009:
|
||||||||||||
Loss from continuing operations
|
$ | (2,753 | ) | 444 | ||||||||
Attributable to participating securities
|
31 | (5 | ) | |||||||||
Basic and diluted loss per share
|
$ | (2,722 | ) | 439 | $ | (6.20 | ) | |||||
Year Ended December 31, 2008:
|
||||||||||||
Loss from continuing operations
|
$ | (3,039 | ) | 444 | ||||||||
Attributable to participating securities
|
31 | (5 | ) | |||||||||
Less preferred stock dividends
|
(5 | ) | ||||||||||
Basic and diluted loss per share
|
$ | (3,013 | ) | 439 | $ | (6.86 | ) | |||||
Year Ended December 31, 2007:
|
||||||||||||
Earnings from continuing operations
|
$ | 2,485 | 445 | |||||||||
Attributable to participating securities
|
(23 | ) | (4 | ) | ||||||||
Less preferred stock dividends
|
(10 | ) | ||||||||||
Basic earnings per share
|
2,452 | 441 | $ | 5.56 | ||||||||
Dilutive effect of potential common shares issuable upon the
exercise of outstanding stock options
|
— | 5 | ||||||||||
Diluted earnings per share
|
$ | 2,452 | 446 | $ | 5.50 | |||||||
20. | Segment Information |
121
U.S. | Canada | International | Total | |||||||||||||
(In millions) | ||||||||||||||||
As of December 31, 2009:
|
||||||||||||||||
Current assets, including current assets held for sale
|
$ | 1,449 | $ | 886 | $ | 657 | $ | 2,992 | ||||||||
Property and equipment, net
|
13,199 | 5,568 | — | 18,767 | ||||||||||||
Goodwill
|
3,046 | 2,884 | — | 5,930 | ||||||||||||
Other assets, including long-term assets held for sale
|
674 | 73 | 1,250 | 1,997 | ||||||||||||
Total assets
|
$ | 18,368 | $ | 9,411 | $ | 1,907 | $ | 29,686 | ||||||||
Current liabilities, including current liabilities held for sale
|
$ | 2,993 | $ | 575 | $ | 234 | $ | 3,802 | ||||||||
Long-term debt
|
2,866 | 2,981 | — | 5,847 | ||||||||||||
Asset retirement obligations, long-term
|
754 | 664 | — | 1,418 | ||||||||||||
Other liabilities, including long-term liabilities held for sale
|
890 | 47 | 213 | 1,150 | ||||||||||||
Deferred income taxes
|
860 | 1,039 | — | 1,899 | ||||||||||||
Stockholders’ equity
|
10,005 | 4,105 | 1,460 | 15,570 | ||||||||||||
Total liabilities and stockholders’ equity
|
$ | 18,368 | $ | 9,411 | $ | 1,907 | $ | 29,686 | ||||||||
122
U.S. | Canada | Total | ||||||||||
(In millions) | ||||||||||||
Year Ended December 31, 2009:
|
||||||||||||
Revenues:
|
||||||||||||
Oil, gas and NGL sales
|
$ | 3,958 | $ | 2,139 | $ | 6,097 | ||||||
Net gain on oil and gas derivative financial instruments
|
382 | 2 | 384 | |||||||||
Marketing and midstream revenues
|
1,498 | 36 | 1,534 | |||||||||
Total revenues
|
5,838 | 2,177 | 8,015 | |||||||||
Expenses and other income, net:
|
||||||||||||
Lease operating expenses
|
997 | 673 | 1,670 | |||||||||
Taxes other than income taxes
|
278 | 36 | 314 | |||||||||
Marketing and midstream operating costs and expenses
|
1,004 | 18 | 1,022 | |||||||||
Depreciation, depletion and amortization of oil and gas
properties
|
1,247 | 585 | 1,832 | |||||||||
Depreciation and amortization of non-oil and gas properties
|
251 | 25 | 276 | |||||||||
Accretion of asset retirement obligations
|
53 | 38 | 91 | |||||||||
General and administrative expenses
|
529 | 119 | 648 | |||||||||
Restructuring costs
|
105 | — | 105 | |||||||||
Interest expense
|
125 | 224 | 349 | |||||||||
Change in fair value of other financial instruments
|
(106 | ) | — | (106 | ) | |||||||
Reduction of carrying value of oil and gas properties
|
6,408 | — | 6,408 | |||||||||
Other (income) expense, net
|
(92 | ) | 24 | (68 | ) | |||||||
Total expenses and other income, net
|
10,799 | 1,742 | 12,541 | |||||||||
(Loss) earnings from continuing operations before income taxes
|
(4,961 | ) | 435 | (4,526 | ) | |||||||
Income tax (benefit) expense:
|
||||||||||||
Current
|
63 | 178 | 241 | |||||||||
Deferred
|
(1,957 | ) | (57 | ) | (2,014 | ) | ||||||
Total income tax (benefit) expense
|
(1,894 | ) | 121 | (1,773 | ) | |||||||
(Loss) earnings from continuing operations
|
$ | (3,067 | ) | $ | 314 | $ | (2,753 | ) | ||||
Capital expenditures, before revision of future asset retirement
obligations
|
$ | 3,536 | $ | 1,114 | $ | 4,650 | ||||||
Revision of future asset retirement obligations
|
48 | (15 | ) | 33 | ||||||||
Capital expenditures, continuing operations
|
$ | 3,584 | $ | 1,099 | $ | 4,683 | ||||||
123
U.S. | Canada | International | Total | |||||||||||||
(In millions) | ||||||||||||||||
As of December 31, 2008:
|
||||||||||||||||
Current assets, including current assets held for sale
|
$ | 1,925 | $ | 367 | $ | 392 | $ | 2,684 | ||||||||
Property and equipment, net
|
17,676 | 4,355 | — | 22,031 | ||||||||||||
Goodwill
|
3,046 | 2,465 | — | 5,511 | ||||||||||||
Other assets, including long-term assets held for sale
|
482 | 72 | 1,128 | 1,682 | ||||||||||||
Total assets
|
$ | 23,129 | $ | 7,259 | $ | 1,520 | $ | 31,908 | ||||||||
Current liabilities, including current liabilities held for sale
|
$ | 2,227 | $ | 543 | $ | 365 | $ | 3,135 | ||||||||
Long-term debt
|
2,683 | 2,978 | — | 5,661 | ||||||||||||
Asset retirement obligations, long-term
|
694 | 555 | — | 1,249 | ||||||||||||
Other liabilities, including long-term liabilities held for sale
|
983 | 40 | 166 | 1,189 | ||||||||||||
Deferred income taxes
|
2,734 | 880 | — | 3,614 | ||||||||||||
Stockholders’ equity
|
13,808 | 2,263 | 989 | 17,060 | ||||||||||||
Total liabilities and stockholders’ equity
|
$ | 23,129 | $ | 7,259 | $ | 1,520 | $ | 31,908 | ||||||||
124
U.S. | Canada | Total | ||||||||||
(In millions) | ||||||||||||
Year Ended December 31, 2008:
|
||||||||||||
Revenues:
|
||||||||||||
Oil, gas and NGL sales
|
$ | 8,206 | $ | 3,514 | $ | 11,720 | ||||||
Net loss on oil and gas derivative financial instruments
|
(154 | ) | — | (154 | ) | |||||||
Marketing and midstream revenues
|
2,247 | 45 | 2,292 | |||||||||
Total revenues
|
10,299 | 3,559 | 13,858 | |||||||||
Expenses and other income, net:
|
||||||||||||
Lease operating expenses
|
1,075 | 776 | 1,851 | |||||||||
Taxes other than income taxes
|
438 | 38 | 476 | |||||||||
Marketing and midstream operating costs and expenses
|
1,593 | 18 | 1,611 | |||||||||
Depreciation, depletion and amortization of oil and gas
properties
|
1,998 | 950 | 2,948 | |||||||||
Depreciation and amortization of non-oil and gas Properties
|
229 | 26 | 255 | |||||||||
Accretion of asset retirement obligations
|
42 | 38 | 80 | |||||||||
General and administrative expenses
|
513 | 132 | 645 | |||||||||
Interest expense
|
117 | 212 | 329 | |||||||||
Change in fair value of other financial instruments
|
149 | — | 149 | |||||||||
Reduction of carrying value of oil and gas properties
|
6,538 | 3,353 | 9,891 | |||||||||
Other income, net
|
(203 | ) | (14 | ) | (217 | ) | ||||||
Total expenses and other income, net
|
12,489 | 5,529 | 18,018 | |||||||||
Loss from continuing operations before income taxes
|
(2,190 | ) | (1,970 | ) | (4,160 | ) | ||||||
Income tax (benefit) expense:
|
||||||||||||
Current
|
289 | 152 | 441 | |||||||||
Deferred
|
(940 | ) | (622 | ) | (1,562 | ) | ||||||
Total income tax benefit
|
(651 | ) | (470 | ) | (1,121 | ) | ||||||
Loss from continuing operations
|
$ | (1,539 | ) | $ | (1,500 | ) | $ | (3,039 | ) | |||
Capital expenditures, before revision of future asset retirement
obligations
|
$ | 8,313 | $ | 1,639 | $ | 9,952 | ||||||
Revision of future asset retirement obligations
|
152 | 73 | 225 | |||||||||
Capital expenditures, continuing operations
|
$ | 8,465 | $ | 1,712 | $ | 10,177 | ||||||
125
U.S. | Canada | Total | ||||||||||
(In millions) | ||||||||||||
Year Ended December 31, 2007:
|
||||||||||||
Revenues:
|
||||||||||||
Oil, gas and NGL sales
|
$ | 5,814 | $ | 2,411 | $ | 8,225 | ||||||
Net gain on oil and gas derivative financial instruments
|
14 | — | 14 | |||||||||
Marketing and midstream revenues
|
1,693 | 43 | 1,736 | |||||||||
Total revenues
|
7,521 | 2,454 | 9,975 | |||||||||
Expenses and other income, net:
|
||||||||||||
Lease operating expenses
|
905 | 627 | 1,532 | |||||||||
Taxes other than income taxes
|
327 | 31 | 358 | |||||||||
Marketing and midstream operating costs and expenses
|
1,200 | 17 | 1,217 | |||||||||
Depreciation, depletion and amortization of oil and gas
properties
|
1,672 | 740 | 2,412 | |||||||||
Depreciation and amortization of non-oil and gas properties
|
180 | 21 | 201 | |||||||||
Accretion of asset retirement obligations
|
38 | 32 | 70 | |||||||||
General and administrative expenses
|
395 | 118 | 513 | |||||||||
Interest expense
|
228 | 202 | 430 | |||||||||
Change in fair value of other financial instruments
|
(32 | ) | (2 | ) | (34 | ) | ||||||
Other income, net
|
(34 | ) | (17 | ) | (51 | ) | ||||||
Total expenses and other income, net
|
4,879 | 1,769 | 6,648 | |||||||||
Earnings from continuing operations before income taxes
|
2,642 | 685 | 3,327 | |||||||||
Income tax expense (benefit):
|
||||||||||||
Current
|
100 | 135 | 235 | |||||||||
Deferred
|
773 | (166 | ) | 607 | ||||||||
Total income tax expense (benefit)
|
873 | (31 | ) | 842 | ||||||||
Earnings from continuing operations
|
$ | 1,769 | $ | 716 | $ | 2,485 | ||||||
Capital expenditures, before revision of future asset retirement
obligations
|
$ | 4,522 | $ | 1,350 | $ | 5,872 | ||||||
Revision of future asset retirement obligations
|
210 | 99 | 309 | |||||||||
Capital expenditures, continuing operations
|
$ | 4,732 | $ | 1,449 | $ | 6,181 | ||||||
126
21. | Supplemental Information to Statements of Cash Flows |
Year Ended December 31, | ||||||||||||
2009 | 2008 | 2007 | ||||||||||
(In millions) | ||||||||||||
Net decrease (increase) in working capital:
|
||||||||||||
Decrease (increase) in accounts receivable
|
$ | 142 | $ | 187 | $ | (286 | ) | |||||
Decrease (increase) in other current assets
|
212 | (46 | ) | (31 | ) | |||||||
(Decrease) increase in accounts payable
|
(91 | ) | 159 | 45 | ||||||||
Increase in revenues and royalties due to others
|
— | 11 | 79 | |||||||||
Decrease in income taxes payable
|
(48 | ) | (309 | ) | (80 | ) | ||||||
Decrease in other current liabilities
|
(66 | ) | (209 | ) | (239 | ) | ||||||
Net decreases (increase) in working capital
|
$ | 149 | $ | (207 | ) | $ | (512 | ) | ||||
Supplementary cash flow data:
|
||||||||||||
Interest paid (net of capitalized interest)
|
$ | 314 | $ | 336 | $ | 406 | ||||||
Income taxes paid (continuing and discontinued operations)
|
$ | 68 | $ | 1,436 | $ | 588 | ||||||
Noncash investing activity — exchange of investment in
Chevron common stock for oil and gas properties
|
$ | — | $ | 610 | $ | — |
22. | Supplemental Information on Oil and Gas Operations (Unaudited) |
Year Ended December 31, 2009 | ||||||||||||||||||||
U.S.
|
U.S.
|
Total
|
North
|
|||||||||||||||||
Onshore | Offshore | U.S. | Canada | America | ||||||||||||||||
(In millions) | ||||||||||||||||||||
Property acquisition costs:
|
||||||||||||||||||||
Proved properties
|
$ | 17 | $ | — | $ | 17 | $ | 18 | $ | 35 | ||||||||||
Unproved properties
|
52 | 11 | 63 | 72 | 135 | |||||||||||||||
Exploration costs
|
122 | 260 | 382 | 152 | 534 | |||||||||||||||
Development costs
|
2,011 | 537 | 2,548 | 835 | 3,383 | |||||||||||||||
Costs incurred
|
$ | 2,202 | $ | 808 | $ | 3,010 | $ | 1,077 | $ | 4,087 | ||||||||||
127
Year Ended December 31, 2008 | ||||||||||||||||||||
U.S.
|
U.S.
|
Total
|
North
|
|||||||||||||||||
Onshore | Offshore | U.S. | Canada | America | ||||||||||||||||
(In millions) | ||||||||||||||||||||
Property acquisition costs:
|
||||||||||||||||||||
Proved properties
|
$ | 822 | $ | — | $ | 822 | $ | — | $ | 822 | ||||||||||
Unproved properties
|
1,226 | 185 | 1,411 | 352 | 1,763 | |||||||||||||||
Exploration costs
|
206 | 638 | 844 | 173 | 1,017 | |||||||||||||||
Development costs
|
4,182 | 551 | 4,733 | 1,131 | 5,864 | |||||||||||||||
Costs incurred
|
$ | 6,436 | $ | 1,374 | $ | 7,810 | $ | 1,656 | $ | 9,466 | ||||||||||
Year Ended December 31, 2007 | ||||||||||||||||||||
U.S.
|
U.S.
|
Total
|
North
|
|||||||||||||||||
Onshore | Offshore | U.S. | Canada | America | ||||||||||||||||
(In millions) | ||||||||||||||||||||
Property acquisition costs:
|
||||||||||||||||||||
Proved properties
|
$ | 3 | $ | — | $ | 3 | $ | 7 | $ | 10 | ||||||||||
Unproved properties
|
77 | 79 | 156 | 49 | 205 | |||||||||||||||
Exploration costs
|
195 | 374 | 569 | 211 | 780 | |||||||||||||||
Development costs
|
3,183 | 359 | 3,542 | 1,098 | 4,640 | |||||||||||||||
Costs incurred
|
$ | 3,458 | $ | 812 | $ | 4,270 | $ | 1,365 | $ | 5,635 | ||||||||||
128
Year Ended December 31, 2009 | ||||||||||||
United States | Canada | North America | ||||||||||
(In millions) | ||||||||||||
Oil, gas and NGL sales
|
$ | 3,958 | $ | 2,139 | $ | 6,097 | ||||||
Lease operating expenses
|
(997 | ) | (673 | ) | (1,670 | ) | ||||||
Taxes other than income taxes
|
(258 | ) | (35 | ) | (293 | ) | ||||||
Depreciation, depletion and amortization
|
(1,247 | ) | (585 | ) | (1,832 | ) | ||||||
Accretion of asset retirement obligations
|
(53 | ) | (38 | ) | (91 | ) | ||||||
General and administrative expenses
|
(145 | ) | (74 | ) | (219 | ) | ||||||
Reduction of carrying value of oil and gas properties
|
(6,408 | ) | — | (6,408 | ) | |||||||
Income tax benefit (expense)
|
1,800 | (220 | ) | 1,580 | ||||||||
Results of operations
|
$ | (3,350 | ) | $ | 514 | $ | (2,836 | ) | ||||
Depreciation, depletion and amortization per Boe
|
$ | 7.47 | $ | 8.84 | $ | 7.86 | ||||||
Year Ended December 31, 2008 | ||||||||||||
United States | Canada | North America | ||||||||||
(In millions) | ||||||||||||
Oil, gas and NGL sales
|
$ | 8,206 | $ | 3,514 | $ | 11,720 | ||||||
Lease operating expenses
|
(1,075 | ) | (776 | ) | (1,851 | ) | ||||||
Taxes other than income taxes
|
(420 | ) | (37 | ) | (457 | ) | ||||||
Depreciation, depletion and amortization
|
(1,998 | ) | (950 | ) | (2,948 | ) | ||||||
Accretion of asset retirement obligations
|
(42 | ) | (38 | ) | (80 | ) | ||||||
General and administrative expenses
|
(148 | ) | (87 | ) | (235 | ) | ||||||
Reduction of carrying value of oil and gas properties
|
(6,538 | ) | (3,353 | ) | (9,891 | ) | ||||||
Income tax benefit
|
719 | 405 | 1,124 | |||||||||
Results of operations
|
$ | (1,296 | ) | $ | (1,322 | ) | $ | (2,618 | ) | |||
Depreciation, depletion and amortization per Boe
|
$ | 12.31 | $ | 15.59 | $ | 13.20 | ||||||
Year Ended December 31, 2007 | ||||||||||||
United States | Canada | North America | ||||||||||
(In millions) | ||||||||||||
Oil, gas and NGL sales
|
$ | 5,814 | $ | 2,411 | $ | 8,225 | ||||||
Lease operating expenses
|
(905 | ) | (627 | ) | (1,532 | ) | ||||||
Taxes other than income taxes
|
(312 | ) | (31 | ) | (343 | ) | ||||||
Depreciation, depletion and amortization
|
(1,672 | ) | (740 | ) | (2,412 | ) | ||||||
Accretion of asset retirement obligations
|
(38 | ) | (32 | ) | (70 | ) | ||||||
General and administrative expenses
|
(143 | ) | (76 | ) | (219 | ) | ||||||
Income tax expense
|
(966 | ) | (49 | ) | (1,015 | ) | ||||||
Results of operations
|
$ | 1,778 | $ | 856 | $ | 2,634 | ||||||
Depreciation, depletion and amortization per Boe
|
$ | 11.44 | $ | 12.73 | $ | 11.81 | ||||||
129
Oil (MMBbls) | ||||||||||||||||||||
U.S.
|
U.S.
|
Total
|
North
|
|||||||||||||||||
Onshore | Offshore | U.S. | Canada | America | ||||||||||||||||
Proved developed and undeveloped reserves:
|
||||||||||||||||||||
December 31, 2006
|
127 | 43 | 170 | 329 | 499 | |||||||||||||||
Revisions due to prices
|
4 | — | 4 | 16 | 20 | |||||||||||||||
Revisions other than price
|
3 | 3 | 6 | 13 | 19 | |||||||||||||||
Extensions and discoveries
|
8 | 1 | 9 | 46 | 55 | |||||||||||||||
Purchase of reserves
|
1 | — | 1 | — | 1 | |||||||||||||||
Production
|
(11 | ) | (8 | ) | (19 | ) | (16 | ) | (35 | ) | ||||||||||
Sale of reserves
|
(1 | ) | — | (1 | ) | — | (1 | ) | ||||||||||||
December 31, 2007
|
131 | 39 | 170 | 388 | 558 | |||||||||||||||
Revisions due to prices
|
(17 | ) | (3 | ) | (20 | ) | (349 | ) | (369 | ) | ||||||||||
Revisions other than price
|
2 | 3 | 5 | 2 | 7 | |||||||||||||||
Extensions and discoveries
|
11 | 1 | 12 | 120 | 132 | |||||||||||||||
Purchase of reserves
|
18 | — | 18 | — | 18 | |||||||||||||||
Production
|
(11 | ) | (6 | ) | (17 | ) | (22 | ) | (39 | ) | ||||||||||
Sale of reserves
|
(1 | ) | — | (1 | ) | (5 | ) | (6 | ) | |||||||||||
December 31, 2008
|
133 | 34 | 167 | 134 | 301 | |||||||||||||||
Revisions due to prices
|
9 | 2 | 11 | 291 | 302 | |||||||||||||||
Revisions other than price
|
— | 1 | 1 | (8 | ) | (7 | ) | |||||||||||||
Extensions and discoveries
|
9 | 2 | 11 | 122 | 133 | |||||||||||||||
Purchase of reserves
|
— | — | — | — | — | |||||||||||||||
Production
|
(12 | ) | (5 | ) | (17 | ) | (25 | ) | (42 | ) | ||||||||||
Sale of reserves
|
— | (1 | ) | (1 | ) | — | (1 | ) | ||||||||||||
December 31, 2009
|
139 | 33 | 172 | 514 | 686 | |||||||||||||||
Proved developed reserves as of:
|
||||||||||||||||||||
December 31, 2006
|
116 | 31 | 147 | 112 | 259 | |||||||||||||||
December 31, 2007
|
122 | 26 | 148 | 195 | 343 | |||||||||||||||
December 31, 2008
|
111 | 22 | 133 | 110 | 243 | |||||||||||||||
December 31, 2009
|
119 | 21 | 140 | 149 | 289 | |||||||||||||||
Proved undeveloped reserves as of:
|
||||||||||||||||||||
December 31, 2006
|
11 | 12 | 23 | 217 | 240 | |||||||||||||||
December 31, 2007
|
9 | 13 | 22 | 193 | 215 | |||||||||||||||
December 31, 2008
|
22 | 12 | 34 | 24 | 58 | |||||||||||||||
December 31, 2009
|
20 | 12 | 32 | 365 | 397 |
130
Gas (Bcf) | ||||||||||||||||||||
U.S.
|
U.S.
|
Total
|
North
|
|||||||||||||||||
Onshore | Offshore | U.S. | Canada | America | ||||||||||||||||
Proved developed and undeveloped reserves:
|
||||||||||||||||||||
December 31, 2006
|
5,979 | 376 | 6,355 | 1,896 | 8,251 | |||||||||||||||
Revisions due to prices
|
117 | 2 | 119 | 50 | 169 | |||||||||||||||
Revisions other than price
|
175 | (1 | ) | 174 | (19 | ) | 155 | |||||||||||||
Extensions and discoveries
|
1,055 | 78 | 1,133 | 139 | 1,272 | |||||||||||||||
Purchase of reserves
|
10 | — | 10 | 5 | 15 | |||||||||||||||
Production
|
(558 | ) | (77 | ) | (635 | ) | (227 | ) | (862 | ) | ||||||||||
Sale of reserves
|
(13 | ) | — | (13 | ) | — | (13 | ) | ||||||||||||
December 31, 2007
|
6,765 | 378 | 7,143 | 1,844 | 8,987 | |||||||||||||||
Revisions due to prices
|
(367 | ) | (2 | ) | (369 | ) | (219 | ) | (588 | ) | ||||||||||
Revisions other than price
|
85 | 21 | 106 | (12 | ) | 94 | ||||||||||||||
Extensions and discoveries
|
1,916 | 50 | 1,966 | 111 | 2,077 | |||||||||||||||
Purchase of reserves
|
250 | — | 250 | 2 | 252 | |||||||||||||||
Production
|
(669 | ) | (57 | ) | (726 | ) | (212 | ) | (938 | ) | ||||||||||
Sale of reserves
|
(1 | ) | — | (1 | ) | (4 | ) | (5 | ) | |||||||||||
December 31, 2008
|
7,979 | 390 | 8,369 | 1,510 | 9,879 | |||||||||||||||
Revisions due to prices
|
(661 | ) | (4 | ) | (665 | ) | (29 | ) | (694 | ) | ||||||||||
Revisions other than price
|
119 | (62 | ) | 57 | (14 | ) | 43 | |||||||||||||
Extensions and discoveries
|
1,387 | 64 | 1,451 | 67 | 1,518 | |||||||||||||||
Purchase of reserves
|
1 | — | 1 | 6 | 7 | |||||||||||||||
Production
|
(698 | ) | (45 | ) | (743 | ) | (223 | ) | (966 | ) | ||||||||||
Sale of reserves
|
— | (1 | ) | (1 | ) | (29 | ) | (30 | ) | |||||||||||
December 31, 2009
|
8,127 | 342 | 8,469 | 1,288 | 9,757 | |||||||||||||||
Proved developed reserves as of:
|
||||||||||||||||||||
December 31, 2006
|
4,672 | 244 | 4,916 | 1,560 | 6,476 | |||||||||||||||
December 31, 2007
|
5,547 | 196 | 5,743 | 1,506 | 7,249 | |||||||||||||||
December 31, 2008
|
6,469 | 212 | 6,681 | 1,357 | 8,038 | |||||||||||||||
December 31, 2009
|
6,447 | 185 | 6,632 | 1,213 | 7,845 | |||||||||||||||
Proved undeveloped reserves as of:
|
||||||||||||||||||||
December 31, 2006
|
1,307 | 132 | 1,439 | 336 | 1,775 | |||||||||||||||
December 31, 2007
|
1,218 | 182 | 1,400 | 338 | 1,738 | |||||||||||||||
December 31, 2008
|
1,510 | 178 | 1,688 | 153 | 1,841 | |||||||||||||||
December 31, 2009
|
1,680 | 157 | 1,837 | 75 | 1,912 |
131
Natural Gas Liquids (MMBbls) | ||||||||||||||||||||
U.S.
|
U.S.
|
Total
|
North
|
|||||||||||||||||
Onshore | Offshore | U.S. | Canada | America | ||||||||||||||||
Proved developed and undeveloped reserves:
|
||||||||||||||||||||
December 31, 2006
|
230 | 3 | 233 | 42 | 275 | |||||||||||||||
Revisions due to prices
|
5 | — | 5 | — | 5 | |||||||||||||||
Revisions other than price
|
22 | (1 | ) | 21 | (1 | ) | 20 | |||||||||||||
Extensions and discoveries
|
45 | — | 45 | 2 | 47 | |||||||||||||||
Purchase of reserves
|
— | — | — | — | — | |||||||||||||||
Production
|
(21 | ) | (1 | ) | (22 | ) | (4 | ) | (26 | ) | ||||||||||
Sale of reserves
|
— | — | — | — | — | |||||||||||||||
December 31, 2007
|
281 | 1 | 282 | 39 | 321 | |||||||||||||||
Revisions due to prices
|
(18 | ) | — | (18 | ) | (2 | ) | (20 | ) | |||||||||||
Revisions other than price
|
5 | 1 | 6 | — | 6 | |||||||||||||||
Extensions and discoveries
|
65 | — | 65 | 2 | 67 | |||||||||||||||
Purchase of reserves
|
6 | — | 6 | — | 6 | |||||||||||||||
Production
|
(24 | ) | — | (24 | ) | (4 | ) | (28 | ) | |||||||||||
Sale of reserves
|
— | — | — | — | — | |||||||||||||||
December 31, 2008
|
315 | 2 | 317 | 35 | 352 | |||||||||||||||
Revisions due to prices
|
(11 | ) | — | (11 | ) | 2 | (9 | ) | ||||||||||||
Revisions other than price
|
36 | 1 | 37 | — | 37 | |||||||||||||||
Extensions and discoveries
|
70 | — | 70 | 1 | 71 | |||||||||||||||
Purchase of reserves
|
— | — | — | — | — | |||||||||||||||
Production
|
(25 | ) | (1 | ) | (26 | ) | (4 | ) | (30 | ) | ||||||||||
Sale of reserves
|
— | — | — | — | — | |||||||||||||||
December 31, 2009
|
385 | 2 | 387 | 34 | 421 | |||||||||||||||
Proved developed reserves as of:
|
||||||||||||||||||||
December 31, 2006
|
194 | 2 | 196 | 33 | 229 | |||||||||||||||
December 31, 2007
|
243 | 1 | 244 | 30 | 274 | |||||||||||||||
December 31, 2008
|
260 | 1 | 261 | 31 | 292 | |||||||||||||||
December 31, 2009
|
293 | 1 | 294 | 32 | 326 | |||||||||||||||
Proved undeveloped reserves as of:
|
||||||||||||||||||||
December 31, 2006
|
36 | 1 | 37 | 9 | 46 | |||||||||||||||
December 31, 2007
|
38 | — | 38 | 9 | 47 | |||||||||||||||
December 31, 2008
|
55 | 1 | 56 | 4 | 60 | |||||||||||||||
December 31, 2009
|
92 | 1 | 93 | 2 | 95 |
132
Total (MMBoe)(1) | ||||||||||||||||||||
U.S.
|
U.S.
|
Total
|
North
|
|||||||||||||||||
Onshore | Offshore | U.S. | Canada | America | ||||||||||||||||
Proved developed and undeveloped reserves:
|
||||||||||||||||||||
December 31, 2006
|
1,353 | 109 | 1,462 | 687 | 2,149 | |||||||||||||||
Revisions due to prices
|
28 | 1 | 29 | 25 | 54 | |||||||||||||||
Revisions other than price
|
55 | 1 | 56 | 7 | 63 | |||||||||||||||
Extensions and discoveries
|
228 | 14 | 242 | 72 | 314 | |||||||||||||||
Purchase of reserves
|
2 | — | 2 | 1 | 3 | |||||||||||||||
Production
|
(124 | ) | (22 | ) | (146 | ) | (58 | ) | (204 | ) | ||||||||||
Sale of reserves
|
(3 | ) | — | (3 | ) | — | (3 | ) | ||||||||||||
December 31, 2007
|
1,539 | 103 | 1,642 | 734 | 2,376 | |||||||||||||||
Revisions due to prices
|
(97 | ) | (3 | ) | (100 | ) | (387 | ) | (487 | ) | ||||||||||
Revisions other than price
|
21 | 7 | 28 | — | 28 | |||||||||||||||
Extensions and discoveries
|
395 | 10 | 405 | 141 | 546 | |||||||||||||||
Purchase of reserves
|
66 | — | 66 | — | 66 | |||||||||||||||
Production
|
(146 | ) | (16 | ) | (162 | ) | (61 | ) | (223 | ) | ||||||||||
Sale of reserves
|
(1 | ) | — | (1 | ) | (6 | ) | (7 | ) | |||||||||||
December 31, 2008
|
1,777 | 101 | 1,878 | 421 | 2,299 | |||||||||||||||
Revisions due to prices
|
(113 | ) | 1 | (112 | ) | 289 | 177 | |||||||||||||
Revisions other than price
|
57 | (8 | ) | 49 | (11 | ) | 38 | |||||||||||||
Extensions and discoveries
|
311 | 12 | 323 | 135 | 458 | |||||||||||||||
Purchase of reserves
|
— | — | — | 1 | 1 | |||||||||||||||
Production
|
(154 | ) | (13 | ) | (167 | ) | (66 | ) | (233 | ) | ||||||||||
Sale of reserves
|
— | (1 | ) | (1 | ) | (6 | ) | (7 | ) | |||||||||||
December 31, 2009
|
1,878 | 92 | 1,970 | 763 | 2,733 | |||||||||||||||
Proved developed reserves as of:
|
||||||||||||||||||||
December 31, 2006
|
1,089 | 74 | 1,163 | 405 | 1,568 | |||||||||||||||
December 31, 2007
|
1,290 | 59 | 1,349 | 476 | 1,825 | |||||||||||||||
December 31, 2008
|
1,449 | 59 | 1,508 | 367 | 1,875 | |||||||||||||||
December 31, 2009
|
1,486 | 53 | 1,539 | 383 | 1,922 | |||||||||||||||
Proved undeveloped reserves as of:
|
||||||||||||||||||||
December 31, 2006
|
264 | 35 | 299 | 282 | 581 | |||||||||||||||
December 31, 2007
|
249 | 44 | 293 | 258 | 551 | |||||||||||||||
December 31, 2008
|
328 | 42 | 370 | 54 | 424 | |||||||||||||||
December 31, 2009
|
392 | 39 | 431 | 380 | 811 |
(1) | Gas reserves are converted to Boe at the rate of six Mcf per Bbl of oil, based upon the approximate relative energy content of gas and oil. This rate is not necessarily indicative of the relationship of natural gas and oil prices. Natural gas liquids reserves are converted to Boe on a one-to-one basis with oil. |
133
134
2009 | 2008 | 2007 | ||||||||||||||||||||||
Prepared | Audited | Prepared | Audited | Prepared | Audited | |||||||||||||||||||
U.S. Onshore
|
— | 93 | % | — | 92 | % | — | 88 | % | |||||||||||||||
U.S. Offshore
|
100 | % | — | 100 | % | — | 100 | % | — | |||||||||||||||
U.S.
|
5 | % | 89 | % | 5 | % | 87 | % | 6 | % | 82 | % | ||||||||||||
Canada
|
— | 91 | % | — | 78 | % | 34 | % | 51 | % | ||||||||||||||
North America
|
3 | % | 89 | % | 4 | % | 85 | % | 15 | % | 73 | % |
135
Year Ended December 31, 2009 | ||||||||||||
United States | Canada | North America | ||||||||||
(In millions) | ||||||||||||
Future cash inflows
|
$ | 44,571 | $ | 28,442 | $ | 73,013 | ||||||
Future costs:
|
||||||||||||
Development
|
(6,814 | ) | (4,132 | ) | (10,946 | ) | ||||||
Production
|
(22,184 | ) | (9,847 | ) | (32,031 | ) | ||||||
Future income tax expense
|
(3,572 | ) | (3,408 | ) | (6,980 | ) | ||||||
Future net cash flows
|
12,001 | 11,055 | 23,056 | |||||||||
10% discount to reflect timing of cash flows
|
(6,121 | ) | (5,532 | ) | (11,653 | ) | ||||||
Standardized measure of discounted future net cash flows
|
$ | 5,880 | $ | 5,523 | $ | 11,403 | ||||||
Year Ended December 31, 2008 | ||||||||||||
United States | Canada | North America | ||||||||||
(In millions) | ||||||||||||
Future cash inflows
|
$ | 51,284 | $ | 11,459 | $ | 62,743 | ||||||
Future costs:
|
||||||||||||
Development
|
(6,887 | ) | (1,623 | ) | (8,510 | ) | ||||||
Production
|
(24,113 | ) | (5,742 | ) | (29,855 | ) | ||||||
Future income tax expense
|
(5,585 | ) | (942 | ) | (6,527 | ) | ||||||
Future net cash flows
|
14,699 | 3,152 | 17,851 | |||||||||
10% discount to reflect timing of cash flows
|
(7,318 | ) | (1,140 | ) | (8,458 | ) | ||||||
Standardized measure of discounted future net cash flows
|
$ | 7,381 | $ | 2,012 | $ | 9,393 | ||||||
Year Ended December 31, 2007 | ||||||||||||
United States | Canada | North America | ||||||||||
(In millions) | ||||||||||||
Future cash inflows
|
$ | 72,109 | $ | 28,684 | $ | 100,793 | ||||||
Future costs:
|
||||||||||||
Development
|
(5,673 | ) | (3,380 | ) | (9,053 | ) | ||||||
Production
|
(24,606 | ) | (10,941 | ) | (35,547 | ) | ||||||
Future income tax expense
|
(12,704 | ) | (3,570 | ) | (16,274 | ) | ||||||
Future net cash flows
|
29,126 | 10,793 | 39,919 | |||||||||
10% discount to reflect timing of cash flows
|
(14,312 | ) | (5,025 | ) | (19,337 | ) | ||||||
Standardized measure of discounted future net cash flows
|
$ | 14,814 | $ | 5,768 | $ | 20,582 | ||||||
136
Year Ended December 31, | ||||||||||||
2009 | 2008 | 2007 | ||||||||||
(In millions) | ||||||||||||
Beginning balance
|
$ | 9,393 | $ | 20,582 | $ | 13,474 | ||||||
Oil, gas and NGL sales, net of production costs
|
(3,915 | ) | (9,177 | ) | (6,131 | ) | ||||||
Net changes in prices and production costs
|
(1,672 | ) | (13,839 | ) | 7,896 | |||||||
Extensions and discoveries, net of future development costs
|
2,378 | 1,729 | 4,130 | |||||||||
Purchase of reserves, net of future development costs
|
6 | 214 | 50 | |||||||||
Development costs incurred that reduced future development costs
|
1,012 | 1,660 | 1,559 | |||||||||
Revisions of quantity estimates
|
4,051 | (1,294 | ) | 564 | ||||||||
Sales of reserves in place
|
(37 | ) | (2 | ) | (51 | ) | ||||||
Accretion of discount
|
1,281 | 2,894 | 1,933 | |||||||||
Net change in income taxes
|
(51 | ) | 4,934 | (2,494 | ) | |||||||
Other, primarily changes in timing and foreign exchange rates
|
(1,043 | ) | 1,692 | (348 | ) | |||||||
Ending balance
|
$ | 11,403 | $ | 9,393 | $ | 20,582 | ||||||
137
23. | Supplemental Quarterly Financial Information (Unaudited) |
2009 | ||||||||||||||||||||
First
|
Second
|
Third
|
Fourth
|
Full
|
||||||||||||||||
Quarter | Quarter | Quarter | Quarter | Year | ||||||||||||||||
(In millions, except per share amounts) | ||||||||||||||||||||
Revenues
|
$ | 1,900 | $ | 1,822 | $ | 1,848 | $ | 2,445 | $ | 8,015 | ||||||||||
(Loss) earnings from continuing operations
|
$ | (3,882 | ) | $ | 190 | $ | 382 | 557 | $ | (2,753 | ) | |||||||||
(Loss) earnings from discontinued operations
|
(77 | ) | 124 | 117 | 110 | 274 | ||||||||||||||
Net (loss) earnings
|
$ | (3,959 | ) | $ | 314 | $ | 499 | $ | 667 | $ | (2,479 | ) | ||||||||
Basic net (loss) earnings per common share:
|
||||||||||||||||||||
(Loss) earnings from continuing operations
|
$ | (8.74 | ) | $ | 0.43 | $ | 0.86 | $ | 1.25 | $ | (6.20 | ) | ||||||||
(Loss) earnings from discontinued operations
|
(0.18 | ) | 0.28 | 0.27 | 0.25 | 0.62 | ||||||||||||||
Net (loss) earnings
|
$ | (8.92 | ) | $ | 0.71 | $ | 1.13 | $ | 1.50 | $ | (5.58 | ) | ||||||||
Diluted net (loss) earnings per common share:
|
||||||||||||||||||||
(Loss) earnings from continuing operations
|
$ | (8.74 | ) | $ | 0.42 | $ | 0.86 | $ | 1.25 | $ | (6.20 | ) | ||||||||
(Loss) earnings from discontinued operations
|
(0.18 | ) | 0.28 | 0.26 | 0.24 | 0.62 | ||||||||||||||
Net (loss) earnings
|
$ | (8.92 | ) | $ | 0.70 | $ | 1.12 | $ | 1.49 | $ | (5.58 | ) | ||||||||
2008 | ||||||||||||||||||||
First
|
Second
|
Third
|
Fourth
|
Full
|
||||||||||||||||
Quarter | Quarter | Quarter | Quarter | Year | ||||||||||||||||
(In millions, except per share amounts) | ||||||||||||||||||||
Revenues
|
$ | 2,503 | $ | 3,152 | $ | 5,651 | $ | 2,552 | $ | 13,858 | ||||||||||
Earnings (loss) from continuing operations
|
$ | 415 | $ | 423 | $ | 2,393 | (6,270 | ) | $ | (3,039 | ) | |||||||||
Earnings (loss) from discontinued operations
|
334 | 878 | 225 | (546 | ) | 891 | ||||||||||||||
Net earnings (loss)
|
$ | 749 | $ | 1,301 | $ | 2,618 | $ | (6,816 | ) | $ | (2,148 | ) | ||||||||
Basic net earnings (loss) per common share:
|
||||||||||||||||||||
Earnings (loss) from continuing operations
|
$ | 0.93 | $ | 0.94 | $ | 5.42 | $ | (14.19 | ) | $ | (6.86 | ) | ||||||||
Earnings (loss) from discontinued operations
|
0.75 | 1.97 | 0.51 | (1.23 | ) | 2.01 | ||||||||||||||
Net earnings (loss)
|
$ | 1.68 | $ | 2.91 | $ | 5.93 | $ | (15.42 | ) | $ | (4.85 | ) | ||||||||
Diluted net earnings (loss) per common share:
|
||||||||||||||||||||
Earnings (loss) from continuing operations
|
$ | 0.92 | $ | 0.93 | $ | 5.37 | $ | (14.19 | ) | $ | (6.86 | ) | ||||||||
Earnings (loss) from discontinued operations
|
0.74 | 1.95 | 0.51 | (1.23 | ) | 2.01 | ||||||||||||||
Net earnings (loss)
|
$ | 1.66 | $ | 2.88 | $ | 5.88 | $ | (15.42 | ) | $ | (4.85 | ) | ||||||||
138
139
Item 9. | Changes in and Disagreements with Accountants on Accounting and Financial Disclosure |
Item 9A. | Controls and Procedures |
Item 9B. | Other Information |
140
Item 10. | Directors, Executive Officers and Corporate Governance |
Item 11. | Executive Compensation |
Item 12. | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters |
Item 13. | Certain Relationships and Related Transactions, and Director Independence |
Item 14. | Principal Accounting Fees and Services |
141
Item 15. | Exhibits and Financial Statement Schedules |
Exhibit No.
|
Description
|
|||
1 | .1 | Underwriting Agreement, dated as of January 6, 2009, among Devon Energy Corporation and Banc of America Securities LLC, J.P. Morgan Securities Inc. and UBS Securities LLC, as representatives of the several Underwriters named therein (incorporated by reference to Exhibit 1.1 to Registrant’s Form 8-K filed on January 9, 2009). | ||
2 | .1 | Agreement and Plan of Merger, dated as of February 23, 2003, by and among Registrant, Devon NewCo Corporation, and Ocean Energy, Inc. (incorporated by reference to Registrant’s Amendment No. 1 to Form S-4 Registration No. 333-103679, filed March 20, 2003). | ||
2 | .2 | Amended and Restated Agreement and Plan of Merger, dated as of August 13, 2001, by and among Registrant, Devon NewCo Corporation, Devon Holdco Corporation, Devon Merger Corporation, Mitchell Merger Corporation and Mitchell Energy & Development Corp. (incorporated by reference to Annex A to Registrant’s Joint Proxy Statement/Prospectus of Form S-4 Registration Statement No. 333-68694 as filed August 30, 2001). | ||
2 | .3 | Offer to Purchase for Cash and Directors’ Circular dated September 6, 2001 (incorporated by reference to Registrant’s and Devon Acquisition Corporation’s Schedule 14D-1F filing, filed September 6, 2001). | ||
2 | .4 | Pre-Acquisition Agreement, dated as of August 31, 2001, between Registrant and Anderson Exploration Ltd. (incorporated by reference to Exhibit 2.2 to Registrant’s Registration Statement on Form S-4, File No. 333-68694 as filed September 14, 2001). | ||
2 | .5 | Amendment No. One, dated as of July 11, 2000, to Agreement and Plan of Merger by and among Registrant, Devon Merger Co. and Santa Fe Snyder Corporation dated as of May 25, 2000 (incorporated by reference to Exhibit 2.1 to Registrant’s Form 8-K filed on July 12, 2000). | ||
2 | .6 | Amended and Restated Agreement and Plan of Merger among Registrant, Devon Energy Corporation (Oklahoma), Devon Oklahoma Corporation and PennzEnergy Company dated as of May 19, 1999 (incorporated by reference to Exhibit 2.1 to Registrant’s Form S-4, File No. 333-82903). | ||
3 | .1 | Registrant’s Restated Certificate of Incorporation (incorporated by reference to Exhibit 3.1 of Registrant’s Form 10-K filed on March 7, 2005). | ||
3 | .2 | Registrant’s Certificate of Amendment of Restated Certificate of Incorporation (incorporated by reference to Exhibit 3.1 of Registrant’s Form 10-Q filed on August 7, 2008). | ||
3 | .3 | Registrant’s Bylaws (incorporated by reference to Exhibit 3.1 of Registrant’s Form 8-K filed on March 6, 2009). | ||
4 | .1 | Indenture, dated as of March 1, 2002, between Registrant and The Bank of New York Mellon Trust Company, N.A., as Trustee, relating to senior debt securities issuable by Registrant (the “Senior Indenture”) (incorporated by reference to Exhibit 4.1 of Registrant’s Form 8-K filed April 9, 2002). | ||
4 | .2 | Supplemental Indenture No. 1, dated as of March 25, 2002, to Indenture dated as of March 1, 2002, between Registrant and The Bank of New York Mellon Trust Company, N.A., as Trustee, relating to the 7.95% Senior Debentures due 2032 (incorporated by reference to Exhibit 4.2 to Registrant’s Form 8-K filed on April 9, 2002). |
142
Exhibit No.
|
Description
|
|||
4 | .3 | Supplemental Indenture No. 3, dated as of January 9, 2009, to Indenture dated as of March 1, 2002, between Registrant and The Bank of New York Mellon Trust Company, N.A., as Trustee, relating to the 5.625% Senior Notes due 2014 and the 6.30% Senior Notes due 2019 (incorporated by reference to Exhibit 4.1 to Registrant’s Form 8-K filed on January 9, 2009). | ||
4 | .4 | Indenture dated as of October 3, 2001, by and among Devon Financing Corporation, U.L.C. as Issuer, Registrant as Guarantor, and The Bank of New York Mellon Trust Company, N.A., originally The Chase Manhattan Bank, as Trustee, relating to the 6.875% Senior Notes due 2011 and the 7.875% Debentures due 2031 (incorporated by reference to Exhibit 4.7 to Registrant’s Registration Statement on Form S-4, File No. 333-68694 as filed October 31, 2001). | ||
4 | .5 | Senior Indenture dated as of September 28, 2001 among Devon OEI Operating, Inc. (as successor by merger to Ocean Energy, Inc.) and The Bank of New York Mellon Trust Company, N.A., as Trustee (incorporated by reference to Exhibit 4.1 to Ocean Energy, Inc.’s Current Report on Form 8-K filed with the SEC on September 28, 2001). Officer’s Certificate establishing the terms of the 7.25% Senior Notes due 2011, including the form of global note relating thereto (incorporated by reference to Exhibit 4.2 to Ocean Energy, Inc.’s Current Report on Form 8-K filed with the SEC on September 28, 2001). | ||
4 | .6 | First Supplemental Indenture, dated December 31, 2005 to Indenture dated as of September 28, 2001 among Devon OEI Operating, Inc. as Issuer, Devon Energy Production Company, L.P. as Successor Guarantor and The Bank of New York Mellon Trust Company, N.A., as Trustee, relating to the 7.25% Senior Notes due 2011 (incorporated by reference to Exhibit 4.19 of Registrant’s Form 10-K for the year ended December 31, 2005). | ||
4 | .7 | Indenture dated as of July 8, 1998 among Devon OEI Operating, Inc. (as successor by merger to Ocean Energy, Inc.), its Subsidiary Guarantors, and Wells Fargo Bank Minnesota, N.A., as Trustee, relating to the 8.25% Senior Notes due 2018 (incorporated by reference to Exhibit 10.24 to the Form 10-Q for the period ended June 30, 1998 of Ocean Energy, Inc. (Registration No. 0-25058)). | ||
4 | .8 | First Supplemental Indenture, dated March 30, 1999 to Indenture dated as of July 8, 1998 among Devon OEI Operating, Inc. (as successor by merger to Ocean Energy, Inc.), its Subsidiary Guarantors, and Wells Fargo Bank Minnesota, N.A., as Trustee, relating to the 8.25% Senior Notes due 2018 (incorporated by reference to Exhibit 4.5 to Ocean Energy, Inc.’s Form 10-Q for the period ended March 31, 1999). | ||
4 | .9 | Second Supplemental Indenture, dated as of May 9, 2001 to Indenture dated as of July 8, 1998 among Devon OEI Operating, Inc. (as successor by merger to Ocean Energy, Inc.), its Subsidiary Guarantors, and Wells Fargo Bank Minnesota, N.A., as Trustee, relating to the 8.25% Senior Notes due 2018 (incorporated by reference to Exhibit 99.2 to Ocean Energy, Inc.’s Current Report on Form 8-K filed with the SEC on May 14, 2001). | ||
4 | .10 | Third Supplemental Indenture, dated January 23, 2006 to Indenture dated as of July 8, 1998 among Devon OEI Operating, Inc. as Issuer, Devon Energy Production Company, L.P. as Successor Guarantor, and Wells Fargo Bank Minnesota, N.A., as Trustee, relating to the 8.25% Senior Notes due 2018 (incorporated by reference to Exhibit 4.23 of Registrant’s Form 10-K for the year ended December 31, 2005). | ||
4 | .11 | Senior Indenture dated September 1, 1997, among Devon OEI Operating, Inc. (as successor by merger to Ocean Energy, Inc.) and The Bank of New York Mellon Trust Company, N.A., as Trustee, and Specimen of 7.50% Senior Notes (incorporated by reference to Exhibit 4.4 to Ocean Energy’s Annual Report on Form 10-K for the year ended December 31, 1997)). | ||
4 | .12 | First Supplemental Indenture, dated as of March 30, 1999 to Senior Indenture dated as of September 1, 1997, among Devon OEI Operating, Inc. (as successor by merger to Ocean Energy, Inc.) and The Bank of New York Mellon Trust Company, N.A., as Trustee, relating to the 7.50% Senior Notes Due 2027 (incorporated by reference to Exhibit 4.10 to Ocean Energy’s Form 10-Q for the period ended March 31, 1999). |
143
Exhibit No.
|
Description
|
|||
4 | .13 | Second Supplemental Indenture, dated as of May 9, 2001 to Senior Indenture dated as of September 1, 1997, among Devon OEI Operating, Inc. (as successor by merger to Ocean Energy, Inc.), its Subsidiary Guarantors, and The Bank of New York Mellon Trust Company, N.A., as Trustee, relating to the 7.50% Senior Notes (incorporated by reference to Exhibit 99.4 to Ocean Energy, Inc.’s Current Report on Form 8-K filed with the SEC on May 14, 2001). | ||
4 | .14 | Third Supplemental Indenture, dated December 31, 2005 to Senior Indenture dated as of September 1, 1997, among Devon OEI Operating, Inc. as Issuer, Devon Energy Production Company, L.P. as Successor Guarantor, and The Bank of New York Mellon Trust Company, N.A.., as Trustee, relating to the 7.50% Senior Notes (incorporated by reference to Exhibit 4.27 of Registrant’s Form 10-K for the year ended December 31, 2005). | ||
10 | .1 | Amended and Restated Investor Rights Agreement, dated as of August 13, 2001, by and among Registrant, Devon Holdco Corporation, George P. Mitchell and Cynthia Woods Mitchell (incorporated by reference to Annex C to the Joint Proxy Statement/Prospectus of Form S-4 Registration Statement No. 333-68694 as filed August 30, 2001). | ||
10 | .2 | First Amendment to Credit Agreement dated as of December 19, 2007, among Registrant as Borrower, Bank of America, N.A., individually and as Administrative Agent and the Lenders party thereto (incorporated by reference to Exhibit 10.3 to Registrant’s Form 10-K filed February 27, 2009). | ||
10 | .3 | Amended and Restated Credit Agreement dated March 24, 2006, effective as of April 7, 2006, among Registrant as US Borrower, Northstar Energy Corporation and Devon Canada Corporation as Canadian Borrowers, Bank of America, N.A. as Administrative Agent, Swing Line Lender and L/C Issuer; JPMorgan Chase Bank, N.A. as Syndication Agent, Bank of Montreal D/B/A “Harris Nesbitt”, Royal Bank of Canada, Wachovia Bank, National Association as Co-Documentation Agents and The Other Lenders Party Hereto, Banc of America Securities L.L.C. and J.P. Morgan Securities Inc., as Joint Lead Arrangers and Book Managers for the $2.0 billion five-year revolving credit facility (incorporated by reference to Exhibit 10.1 to Registrant’s Form 10-Q filed on May 4, 2006). | ||
10 | .4 | First Amendment to Amended and Restated Credit Agreement dated as of June 1, 2006, among Registrant as the US Borrower, Northstar Energy Corporation and Devon Canada Corporation as the Canadian Borrowers, Bank of America, N.A., individually and as Administrative Agent and the Lenders party to this Amendment. (incorporated by reference to Exhibit 10.2 to Registrant’s Form 10-Q filed on November 7, 2007). | ||
10 | .5 | Second Amendment to Amended and Restated Credit Agreement dated as of September 19, 2007, among Registrant as the US Borrower, Northstar Energy Corporation and Devon Canada Corporation as the Canadian Borrowers, Bank of America, N.A., individually and as Administrative Agent and the Lenders party to this Amendment. (incorporated by reference to Exhibit 10.3 to Registrant’s Form 10-Q filed on November 7, 2007). | ||
10 | .6 | Third Amendment to Amended and Restated Credit Agreement dated as of December 19, 2007, among Registrant as the US Borrower, Northstar Energy Corporation and Devon Canada Corporation as the Canadian Borrowers, Bank of America, N.A., individually and as Administrative Agent and the Lenders party thereto (incorporated by reference to Exhibit 10.7 to Registrant’s Form 10-K filed February 27, 2009). | ||
10 | .7 | Fourth Amendment to Amended and Restated Credit Agreement dated as of April 7, 2008, among Registrant as US Borrower, Northstar Energy Corporation and Devon Canada Corporation as the Canadian Borrowers, Bank of America, N.A., individually and as Administrative Agent and the Lenders party thereto (incorporated by reference to Exhibit 10.1 of Registrant’s Form 10-Q filed on May 7, 2008). | ||
10 | .8 | Fifth Amendment to Amended and Restated Credit Agreement dated as of November 5, 2008, among Registrant as US Borrower, Northstar Energy Corporation and Devon Canada Corporation as the Canadian Borrowers, Bank of America, N.A., individually and as Administrative Agent, and the Lenders party thereto (incorporated by reference to Exhibit 10.2 of Registrant’s Form 10-Q filed on November 6, 2008). |
144
Exhibit No.
|
Description
|
|||
10 | .9 | 364-Day Credit Agreement dated as of November 3, 2009 among Registrant as Borrower, Bank of America, N.A. as Administrative Agent, JPMorgan Chase Bank, N.A. as Syndication Agent, and The Other Lenders party thereto, Banc of America Securities LLC and J.P. Morgan Securities, Inc. as Joint Lead Arrangers and Book Managers for the $700 Million Short-Term Credit Facility (incorporated by reference to Exhibit 10.1 of Registrant’s Form 10-Q filed on November 5, 2009). | ||
10 | .10 | Devon Energy Corporation 2009 Long-Term Incentive Plan (incorporated by reference to Registrant’s Form S-8 Registration No. 333-159796, filed June 5, 2009).* | ||
10 | .11 | Devon Energy Corporation 2005 Long-Term Incentive Plan (incorporated by reference to Registrant’s Form S-8 Registration No. 333-127630, filed August 17, 2005).* | ||
10 | .12 | First Amendment to Devon Energy Corporation 2005 Long-Term Incentive Plan (incorporated by reference to Appendix A to Registrant’s Proxy Statement for the 2006 Annual Meeting of Stockholders filed on April 28, 2006).* | ||
10 | .13 | Devon Energy Corporation 2003 Long-Term Incentive Plan (incorporated by reference to Registrant’s Form S-8 Registration No. 333-104922, filed May 1, 2003).* | ||
10 | .14 | Devon Energy Corporation 1997 Stock Option Plan (as amended August 29, 2000) (incorporated by reference to Exhibit A to Registrant’s Proxy Statement for the 1997 Annual Meeting of Shareholders filed on April 3, 1997).* | ||
10 | .15 | Santa Fe Energy Resources Incentive Compensation Plan, as amended (incorporated by reference to Exhibit 10(a) to Santa Fe Energy Resources, Inc.’s Annual Report on Form 10-K for the year ended December 31, 1998).* | ||
10 | .16 | Santa Fe Energy Resources, Inc. Supplemental Retirement Plan effective as of December 4, 1990 (incorporated by reference to Exhibit 10(h) to Santa Fe Energy Resources, Inc.’s Annual Report on Form 10-K for the year ended December 31, 1996).* | ||
10 | .17 | Amended and Restated Form of Employment Agreement between Registrant and David A. Hager, R. Alan Marcum, J. Larry Nichols, John Richels, Frank W. Rudolph, Darryl G. Smette, Lyndon C. Taylor and William F. Whitsitt dated December 15, 2008 (incorporated by reference to Exhibit 10.19 to Registrant’s Form 10-K filed February 27, 2009).* | ||
10 | .18 | Form of Employee Nonqualified Stock Option Award Agreement under the 2009 Long-Term Incentive Plan between Registrant and David A. Hager, R. Alan Marcum, J. Larry Nichols, John Richels, Frank W. Rudolph, Darryl G. Smette, Lyndon C. Taylor and William F. Whitsitt for nonqualified stock options granted.* | ||
10 | .19 | Form of Incentive Stock Option Award Agreement under the 2009 Long-Term Incentive Plan between Registrant and David A. Hager, R. Alan Marcum, J. Larry Nichols, John Richels, Frank W. Rudolph, Darryl G. Smette, Lyndon C. Taylor and William F. Whitsitt for incentive stock options granted.* | ||
10 | .20 | Form of Non-Management Director Nonqualified Stock Option Award Agreement under the Devon Energy Corporation 2009 Long-Term Incentive Plan between Registrant and all Non-Management Directors for nonqualified stock options granted.* | ||
10 | .21 | Form of Restricted Stock Award Agreement under the 2009 Long-Term Incentive Plan between Registrant and David A. Hager, R. Alan Marcum, J. Larry Nichols, John Richels, Frank W. Rudolph, Darryl G. Smette, Lyndon C. Taylor and William F. Whitsitt for restricted stock awards.* | ||
10 | .22 | Form of Restricted Stock Award Agreement under the 2009 Long-Term Incentive Plan between Registrant and all Non-Management Directors for restricted stock awards.* | ||
10 | .23 | Amended and Restated Severance Agreement between Registrant and Danny J. Heatly, dated December 15, 2008 (incorporated by reference to Exhibit 10.27 to Registrant’s Form 10-K filed on February 27, 2009).* | ||
12 | Statement of computations of ratios of earnings to fixed charges and to combined fixed charges and preferred stock dividends. | |||
21 | Registrant’s Significant Subsidiaries. | |||
23 | .1 | Consent of KPMG LLP. | ||
23 | .2 | Consent of LaRoche Petroleum Consultants. | ||
23 | .3 | Consent of Ryder Scott Company, L.P. |
145
Exhibit No.
|
Description
|
|||
23 | .4 | Consent of AJM Petroleum Consultants. | ||
31 | .1 | Certification of principal executive office pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | ||
31 | .2 | Certification of principal financial officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | ||
32 | .1 | Certification of principal executive officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | ||
32 | .2 | Certification of principal financial officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | ||
99 | .1 | Report of LaRoche Petroleum Consultants. | ||
99 | .2 | Report of Ryder Scott Company, L.P. | ||
99 | .3 | Report of AJM Petroleum Consultants. | ||
101 | .INS | XBRL Instance Document | ||
101 | .SCH | XBRL Taxonomy Extension Schema Document | ||
101 | .CAL | XBRL Taxonomy Extension Calculation Linkbase Document | ||
101 | .LAB | XBRL Taxonomy Extension Labels Linkbase Document | ||
101 | .PRE | XBRL Taxonomy Extension Presentation Linkbase Document | ||
101 | .DEF | XBRL Taxonomy Extension Definition Linkbase Document |
* | Compensatory plans or arrangements |
146
By: |
/s/ J.
LARRY NICHOLS
|
/s/
J.
Larry Nichols
|
Chairman of the Board, Chief
Executive Officer and Director |
February 24, 2010 | ||||
/s/
John
Richels
|
President and Director | February 24, 2010 | ||||
/s/
Danny
J. Heatly
|
Senior Vice President — Accounting and Chief Accounting Officer | February 24, 2010 | ||||
/s/
Thomas
F. Ferguson
|
Director | February 24, 2010 | ||||
/s/
John
A. Hill
|
Director | February 24, 2010 | ||||
/s/
Robert
L. Howard
|
Director | February 24, 2010 | ||||
/s/
Michael
M. Kanovsky
|
Director | February 24, 2010 | ||||
/s/
J.
Todd Mitchell
|
Director | February 24, 2010 | ||||
/s/
Robert
A. Mosbacher, Jr.
|
Director | February 24, 2010 | ||||
/s/
Mary
P. Ricciardello
|
Director | February 24, 2010 |
147
Exhibit No.
|
Description
|
|||
10 | .18 | Form of Employee Nonqualified Stock Option Award Agreement under the 2009 Long-Term Incentive Plan between Registrant and David A. Hager, R. Alan Marcum, J. Larry Nichols, John Richels, Frank W. Rudolph, Darryl G. Smette, Lyndon C. Taylor and William F. Whitsitt for nonqualified stock options granted.* | ||
10 | .19 | Form of Incentive Stock Option Award Agreement under the 2009 Long-Term Incentive Plan between Registrant and David A. Hager, R. Alan Marcum, J. Larry Nichols, John Richels, Frank W. Rudolph, Darryl G. Smette, Lyndon C. Taylor and William F. Whitsitt for incentive stock options granted.* | ||
10 | .20 | Form of Non-Management Director Nonqualified Stock Option Award Agreement under the Devon Energy Corporation 2009 Long-Term Incentive Plan between Registrant and all Non-Management Directors for nonqualified stock options granted.* | ||
10 | .21 | Form of Restricted Stock Award Agreement under the 2009 Long-Term Incentive Plan between Registrant and David A. Hager, R. Alan Marcum, J. Larry Nichols, John Richels, Frank W. Rudolph, Darryl G. Smette, Lyndon C. Taylor and William F. Whitsitt for restricted stock awards.* | ||
10 | .22 | Form of Restricted Stock Award Agreement under the 2009 Long-Term Incentive Plan between Registrant and all Non-Management Directors for restricted stock awards.* | ||
12 | Statement of computations of ratios of earnings to fixed charges and to combined fixed charges and preferred stock dividends. | |||
21 | Registrant’s Significant Subsidiaries. | |||
23 | .1 | Consent of KPMG LLP. | ||
23 | .2 | Consent of LaRoche Petroleum Consultants. | ||
23 | .3 | Consent of Ryder Scott Company, L.P. | ||
23 | .4 | Consent of AJM Petroleum Consultants. | ||
31 | .1 | Certification of principal executive office pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | ||
31 | .2 | Certification of principal financial officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | ||
32 | .1 | Certification of principal executive officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | ||
32 | .2 | Certification of principal financial officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | ||
99 | .1 | Report of LaRoche Petroleum Consultants. | ||
99 | .2 | Report of Ryder Scott Company, L.P. | ||
99 | .3 | Report of AJM Petroleum Consultants. | ||
101 | .INS | XBRL Instance Document | ||
101 | .SCH | XBRL Taxonomy Extension Schema Document | ||
101 | .CAL | XBRL Taxonomy Extension Calculation Linkbase Document | ||
101 | .LAB | XBRL Taxonomy Extension Labels Linkbase Document | ||
101 | .PRE | XBRL Taxonomy Extension Presentation Linkbase Document | ||
101 | .DEF | XBRL Taxonomy Extension Definition Linkbase Document |
* | Compensatory plans or arrangements |
No information found
* THE VALUE IS THE MARKET VALUE AS OF THE LAST DAY OF THE QUARTER FOR WHICH THE 13F WAS FILED.
FUND | NUMBER OF SHARES | VALUE ($) | PUT OR CALL |
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DIRECTORS | AGE | BIO | OTHER DIRECTOR MEMBERSHIPS |
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No information found
No Customers Found
Price
Yield
Owner | Position | Direct Shares | Indirect Shares |
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