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þ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Delaware
(State of other jurisdiction of incorporation or organization) |
73-1567067
(I.R.S. Employer identification No.) |
|
20 North Broadway, Oklahoma City, Oklahoma
(Address of principal executive offices) |
73102-8260
(Zip code) |
Large accelerated filer þ | Accelerated filer o |
Non-accelerated filer
o
(Do not check if a smaller reporting company) |
Smaller reporting company o |
|
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3 | ||||||||
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4 | ||||||||
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5 | ||||||||
6 | ||||||||
7 | ||||||||
8 | ||||||||
9 | ||||||||
10 | ||||||||
27 | ||||||||
40 | ||||||||
41 | ||||||||
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42 | ||||||||
42 | ||||||||
42 | ||||||||
42 | ||||||||
42 | ||||||||
42 | ||||||||
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43 | ||||||||
EX-31.1 | ||||||||
EX-31.2 | ||||||||
EX-32.1 | ||||||||
EX-32.2 | ||||||||
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
• | “NGL” or “NGLs” means natural gas liquids. | ||
• | “Oil” includes crude oil and condensate. | ||
• | “Bbl” means barrel of oil. One barrel equals 42 U.S. gallons. |
• | “MBbls” means thousand barrels. | ||
• | “MMBbls” means million barrels. | ||
• | “MBbls/d” means thousand barrels per day. |
• | “Mcf” means thousand cubic feet of natural gas. |
• | “MMcf” means million cubic feet. | ||
• | “Bcf” means billion cubic feet. | ||
• | “Bcfe” means billion cubic feet equivalent. | ||
• | “MMcf/d” means million cubic feet per day. |
• | “Boe” means barrel of oil equivalent, determined by using the ratio of one Bbl of oil or NGLs to six Mcf of gas. |
• | “MBoe” means thousand Boe. | ||
• | “MMBoe” means million Boe. | ||
• | “MBoe/d” means thousand Boe per day. |
• | “Btu” means British thermal units, a measure of heating value. |
• | “MMBtu” means million Btu. | ||
• | “MMBtu/d” means million Btu per day. |
• | “Canada” means the operations of Devon encompassing oil and gas properties located in Canada. | ||
• | “International” means the discontinued operations of Devon that encompass oil and gas properties that lie outside the United States and Canada. | ||
• | “North America Onshore” means the operations of Devon encompassing oil and gas properties in the continental United States and Canada. | ||
• | “U.S. Offshore” means the divested operations of Devon that encompassed oil and gas properties in the Gulf of Mexico. | ||
• | “U.S. Onshore” means the properties of Devon encompassing oil and gas properties in the continental United States. |
• | “FASB” means the United States Financial Accounting Standards Board. | ||
• | “Federal Funds Rate” means the interest rate at which depository institutions lend balances at the Federal Reserve to other depository institutions overnight. | ||
• | “Inside FERC” refers to the publication Inside F.E.R.C.’s Gas Market Report. | ||
• | “LIBOR” means London Interbank Offered Rate. | ||
• | “NYMEX” means New York Mercantile Exchange. | ||
• | “SEC” means United States Securities and Exchange Commission. |
3
• | energy markets, including the supply and demand for oil, gas, NGLs and other products or services, as well as the prices of oil, gas, NGLs and other products or services, including regional pricing differentials; | ||
• | production levels, including Canadian production subject to government royalties, which fluctuate with prices and 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; | ||
• | public policy and government regulatory changes, including changes in royalty, production tax and income tax regimes, changes in hydraulic fracturing regulation and changes in environmental laws, regulation and liability; | ||
• | terrorism; | ||
• | occurrence of property acquisitions or divestitures; and | ||
• | other factors disclosed in Devon’s 2010 Annual Report on Form 10-K under “Item 1A. Risk Factors,” “Item 2. Properties,” “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Item 7A. Quantitative and Qualitative Disclosures About Market Risk.” |
4
June 30, | December 31, | |||||||
2011 | 2010 | |||||||
(Unaudited) | ||||||||
(In millions, except share data) | ||||||||
ASSETS
|
||||||||
Current assets:
|
||||||||
Cash and cash equivalents
|
$ | 3,351 | $ | 2,866 | ||||
Short-term investments
|
3,367 | 145 | ||||||
Accounts receivable
|
1,446 | 1,202 | ||||||
Current assets held for sale
|
36 | 563 | ||||||
Other current assets
|
711 | 779 | ||||||
|
||||||||
Total current assets
|
8,911 | 5,555 | ||||||
|
||||||||
Property and equipment, at cost:
|
||||||||
Oil and gas, based on full cost accounting:
|
||||||||
Subject to amortization
|
59,423 | 56,012 | ||||||
Not subject to amortization
|
3,915 | 3,434 | ||||||
|
||||||||
Total oil and gas
|
63,338 | 59,446 | ||||||
Other
|
4,732 | 4,429 | ||||||
|
||||||||
Total property and equipment, at cost
|
68,070 | 63,875 | ||||||
Less accumulated depreciation, depletion and amortization
|
(45,643 | ) | (44,223 | ) | ||||
|
||||||||
Property and equipment, net
|
22,427 | 19,652 | ||||||
|
||||||||
Goodwill
|
6,176 | 6,080 | ||||||
Long-term assets held for sale
|
94 | 859 | ||||||
Other long-term assets
|
929 | 781 | ||||||
|
||||||||
Total assets
|
$ | 38,537 | $ | 32,927 | ||||
|
||||||||
|
||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
||||||||
Current liabilities:
|
||||||||
Accounts payable — trade
|
$ | 1,365 | $ | 1,411 | ||||
Revenues and royalties due to others
|
669 | 538 | ||||||
Short-term debt
|
1,962 | 1,811 | ||||||
Current liabilities associated with assets held for sale
|
43 | 305 | ||||||
Other current liabilities
|
445 | 518 | ||||||
|
||||||||
Total current liabilities
|
4,484 | 4,583 | ||||||
|
||||||||
Long-term debt
|
5,968 | 3,819 | ||||||
Asset retirement obligations
|
1,499 | 1,423 | ||||||
Liabilities associated with assets held for sale
|
2 | 26 | ||||||
Other long-term liabilities
|
808 | 1,067 | ||||||
Deferred income taxes
|
4,348 | 2,756 | ||||||
Stockholders’ equity:
|
||||||||
Common stock of $0.10 par value. Authorized 1.0 billion shares;
issued 418.3 million and 431.9 million shares in 2011 and 2010, respectively
|
42 | 43 | ||||||
Additional paid-in capital
|
4,489 | 5,601 | ||||||
Retained earnings
|
14,901 | 11,882 | ||||||
Accumulated other comprehensive earnings
|
2,021 | 1,760 | ||||||
Treasury stock, at cost. 0.3 million and 0.4 million shares in 2011 and 2010,
respectively
|
(25 | ) | (33 | ) | ||||
|
||||||||
Total stockholders’ equity
|
21,428 | 19,253 | ||||||
|
||||||||
Commitments and contingencies (Note 11)
|
||||||||
Total liabilities and stockholders’ equity
|
$ | 38,537 | $ | 32,927 | ||||
|
5
Three Months Ended | Six Months Ended | |||||||||||||||
June 30, | June 30, | |||||||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||||
(Unaudited) | ||||||||||||||||
(In millions, except | ||||||||||||||||
per share amounts) | ||||||||||||||||
Revenues:
|
||||||||||||||||
Oil, gas and NGL sales
|
$ | 2,200 | $ | 1,782 | $ | 4,060 | $ | 3,852 | ||||||||
Oil, gas and NGL derivatives
|
416 | 45 | 248 | 665 | ||||||||||||
Marketing and midstream revenues
|
604 | 405 | 1,059 | 935 | ||||||||||||
|
||||||||||||||||
Total revenues
|
3,220 | 2,232 | 5,367 | 5,452 | ||||||||||||
|
||||||||||||||||
Expenses and other, net:
|
||||||||||||||||
Lease operating expenses
|
453 | 442 | 877 | 856 | ||||||||||||
Taxes other than income taxes
|
120 | 92 | 228 | 193 | ||||||||||||
Marketing and midstream operating costs and expenses
|
456 | 280 | 789 | 677 | ||||||||||||
Depreciation, depletion and amortization of oil and gas properties
|
485 | 426 | 927 | 852 | ||||||||||||
Depreciation and amortization of non-oil and gas properties
|
65 | 63 | 129 | 126 | ||||||||||||
Accretion of asset retirement obligations
|
23 | 24 | 46 | 50 | ||||||||||||
General and administrative expenses
|
135 | 130 | 265 | 268 | ||||||||||||
Restructuring costs
|
6 | (8 | ) | 1 | (8 | ) | ||||||||||
Interest expense
|
85 | 111 | 166 | 197 | ||||||||||||
Interest-rate and other financial instruments
|
25 | 81 | 8 | 66 | ||||||||||||
Other, net
|
(11 | ) | (22 | ) | (27 | ) | (26 | ) | ||||||||
|
||||||||||||||||
Total expenses and other, net
|
1,842 | 1,619 | 3,409 | 3,251 | ||||||||||||
|
||||||||||||||||
Earnings from continuing operations before income taxes
|
1,378 | 613 | 1,958 | 2,201 | ||||||||||||
|
||||||||||||||||
Income tax expense (benefit):
|
||||||||||||||||
Current
|
36 | 707 | (53 | ) | 1,006 | |||||||||||
Deferred
|
1,158 | (446 | ) | 1,438 | (231 | ) | ||||||||||
|
||||||||||||||||
Total income tax expense
|
1,194 | 261 | 1,385 | 775 | ||||||||||||
|
||||||||||||||||
Earnings from continuing operations
|
184 | 352 | 573 | 1,426 | ||||||||||||
|
||||||||||||||||
Discontinued operations:
|
||||||||||||||||
Earnings from discontinued operations before income taxes
|
2,558 | 473 | 2,588 | 610 | ||||||||||||
Discontinued operations income tax (benefit) expense
|
(1 | ) | 119 | 2 | 138 | |||||||||||
|
||||||||||||||||
Earnings from discontinued operations
|
2,559 | 354 | 2,586 | 472 | ||||||||||||
|
||||||||||||||||
Net earnings
|
$ | 2,743 | $ | 706 | $ | 3,159 | $ | 1,898 | ||||||||
|
||||||||||||||||
|
||||||||||||||||
Basic net earnings per share:
|
||||||||||||||||
Basic earnings from continuing operations per share
|
$ | 0.44 | $ | 0.79 | $ | 1.35 | $ | 3.20 | ||||||||
Basic earnings from discontinued operations per share
|
6.06 | 0.80 | 6.09 | 1.06 | ||||||||||||
|
||||||||||||||||
Basic net earnings per share
|
$ | 6.50 | $ | 1.59 | $ | 7.44 | $ | 4.26 | ||||||||
|
||||||||||||||||
|
||||||||||||||||
Diluted net earnings per share:
|
||||||||||||||||
Diluted earnings from continuing operations per share
|
$ | 0.43 | $ | 0.79 | $ | 1.34 | $ | 3.19 | ||||||||
Diluted earnings from discontinued operations per share
|
6.05 | 0.79 | 6.07 | 1.05 | ||||||||||||
|
||||||||||||||||
Diluted net earnings per share
|
$ | 6.48 | $ | 1.58 | $ | 7.41 | $ | 4.24 | ||||||||
|
6
Three Months Ended | Six Months Ended | |||||||||||||||
June 30, | June 30, | |||||||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||||
(Unaudited) | ||||||||||||||||
(In millions) | ||||||||||||||||
|
||||||||||||||||
Net earnings
|
$ | 2,743 | $ | 706 | $ | 3,159 | $ | 1,898 | ||||||||
Foreign currency translation:
|
||||||||||||||||
Change in cumulative translation adjustment
|
67 | (326 | ) | 262 | (104 | ) | ||||||||||
Foreign currency translation income tax (expense) benefit
|
(2 | ) | 17 | (12 | ) | 5 | ||||||||||
|
||||||||||||||||
Foreign currency translation total
|
65 | (309 | ) | 250 | (99 | ) | ||||||||||
|
||||||||||||||||
Pension and postretirement benefit plans:
|
||||||||||||||||
Recognition of net actuarial loss and prior service cost in earnings
|
8 | 8 | 17 | 16 | ||||||||||||
Pension and postretirement benefit plans income tax expense
|
(3 | ) | (3 | ) | (6 | ) | (6 | ) | ||||||||
|
||||||||||||||||
Pension and postretirement benefit plans total
|
5 | 5 | 11 | 10 | ||||||||||||
|
||||||||||||||||
Other comprehensive earnings (loss), net of tax
|
70 | (304 | ) | 261 | (89 | ) | ||||||||||
|
||||||||||||||||
Comprehensive earnings
|
$ | 2,813 | $ | 402 | $ | 3,420 | $ | 1,809 | ||||||||
|
7
Accumulated | ||||||||||||||||||||||||||||
Additional | Other | Total | ||||||||||||||||||||||||||
Common Stock | Paid-In | Retained | Comprehensive | Treasury | Stockholders’ | |||||||||||||||||||||||
Shares | Amount | Capital | Earnings | Earnings | Stock | Equity | ||||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||||||||||
(In millions) | ||||||||||||||||||||||||||||
Six Months Ended June 30, 2011:
|
||||||||||||||||||||||||||||
Balance as of December 31, 2010
|
432 | $ | 43 | $ | 5,601 | $ | 11,882 | $ | 1,760 | $ | (33 | ) | $ | 19,253 | ||||||||||||||
Net earnings
|
— | — | — | 3,159 | — | — | 3,159 | |||||||||||||||||||||
Other comprehensive earnings (loss), net
of tax
|
— | — | — | — | 261 | — | 261 | |||||||||||||||||||||
Stock option exercises
|
2 | — | 96 | — | — | — | 96 | |||||||||||||||||||||
Common stock repurchased
|
— | — | — | — | — | (1,285 | ) | (1,285 | ) | |||||||||||||||||||
Common stock retired
|
(16 | ) | (1 | ) | (1,292 | ) | — | — | 1,293 | — | ||||||||||||||||||
Common stock dividends
|
— | — | — | (140 | ) | — | — | (140 | ) | |||||||||||||||||||
Share-based compensation
|
— | — | 72 | — | — | — | 72 | |||||||||||||||||||||
Share-based compensation tax benefits
|
— | — | 12 | — | — | — | 12 | |||||||||||||||||||||
|
||||||||||||||||||||||||||||
Balance as of June 30, 2011
|
418 | $ | 42 | $ | 4,489 | $ | 14,901 | $ | 2,021 | $ | (25 | ) | $ | 21,428 | ||||||||||||||
|
||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||
Six Months Ended June 30, 2010:
|
||||||||||||||||||||||||||||
Balance as of December 31, 2009
|
447 | $ | 45 | $ | 6,527 | $ | 7,613 | $ | 1,385 | $ | — | $ | 15,570 | |||||||||||||||
Net earnings
|
— | — | — | 1,898 | — | — | 1,898 | |||||||||||||||||||||
Other comprehensive earnings (loss), net
of tax
|
— | — | — | — | (89 | ) | — | (89 | ) | |||||||||||||||||||
Stock option exercises
|
— | — | 15 | — | — | — | 15 | |||||||||||||||||||||
Common stock repurchased
|
— | — | — | — | — | (503 | ) | (503 | ) | |||||||||||||||||||
Common stock retired
|
(7 | ) | (1 | ) | (437 | ) | — | — | 438 | — | ||||||||||||||||||
Common stock dividends
|
— | — | — | (142 | ) | — | — | (142 | ) | |||||||||||||||||||
Share-based compensation
|
— | — | 75 | — | — | — | 75 | |||||||||||||||||||||
Share-based compensation tax benefits
|
— | — | 6 | — | — | — | 6 | |||||||||||||||||||||
|
||||||||||||||||||||||||||||
Balance as of June 30, 2010
|
440 | $ | 44 | $ | 6,186 | $ | 9,369 | $ | 1,296 | $ | (65 | ) | $ | 16,830 | ||||||||||||||
|
8
Six Months | ||||||||
Ended June 30, | ||||||||
2011 | 2010 | |||||||
(Unaudited) | ||||||||
(In millions) | ||||||||
Cash flows from operating activities:
|
||||||||
Net earnings
|
$ | 3,159 | $ | 1,898 | ||||
Earnings from discontinued operations, net of tax
|
(2,586 | ) | (472 | ) | ||||
Adjustments to reconcile earnings from continuing operations
to net cash provided by operating activities:
|
||||||||
Depreciation, depletion and amortization
|
1,056 | 978 | ||||||
Deferred income tax expense (benefit)
|
1,438 | (231 | ) | |||||
Unrealized change in fair value of financial instruments
|
(74 | ) | (231 | ) | ||||
Other noncash charges
|
82 | 81 | ||||||
Net (increase) decrease in working capital
|
(89 | ) | 581 | |||||
Decrease in long-term other assets
|
45 | 14 | ||||||
(Decrease) increase in long-term other liabilities
|
(201 | ) | 1 | |||||
|
||||||||
Cash from operating activities — continuing operations
|
2,830 | 2,619 | ||||||
Cash from operating activities — discontinued operations
|
(20 | ) | 273 | |||||
|
||||||||
Net cash from operating activities
|
2,810 | 2,892 | ||||||
|
||||||||
|
||||||||
Cash flows from investing activities:
|
||||||||
Capital expenditures
|
(3,720 | ) | (3,221 | ) | ||||
Proceeds from property and equipment divestitures
|
5 | 4,129 | ||||||
Purchases of short-term investments
|
(4,520 | ) | — | |||||
Redemptions of short-term investments
|
1,298 | — | ||||||
Redemptions of long-term investments
|
1 | 18 | ||||||
Other
|
(33 | ) | — | |||||
|
||||||||
Cash from investing activities — continuing operations
|
(6,969 | ) | 926 | |||||
Cash from investing activities — discontinued operations
|
3,170 | 429 | ||||||
|
||||||||
Net cash from investing activities
|
(3,799 | ) | 1,355 | |||||
|
||||||||
|
||||||||
Cash flows from financing activities:
|
||||||||
Net commercial paper borrowings (repayments)
|
2,340 | (1,432 | ) | |||||
Debt repayments
|
— | (350 | ) | |||||
Proceeds from stock option exercises
|
96 | 15 | ||||||
Repurchases of common stock
|
(1,290 | ) | (430 | ) | ||||
Dividends paid on common stock
|
(140 | ) | (142 | ) | ||||
Excess tax benefits related to share-based compensation
|
12 | 6 | ||||||
|
||||||||
Net cash from financing activities
|
1,018 | (2,333 | ) | |||||
|
||||||||
Effect of exchange rate changes on cash
|
32 | (9 | ) | |||||
|
||||||||
Net increase in cash and cash equivalents
|
61 | 1,905 | ||||||
Cash and cash equivalents at beginning of period (including cash
related to assets held for sale)
|
3,290 | 1,011 | ||||||
|
||||||||
Cash and cash equivalents at end of period (including cash related
to assets held for sale)
|
$ | 3,351 | $ | 2,916 | ||||
|
9
June 30, 2011 | December 31, 2010 | |||||||
(In millions) | ||||||||
Oil, gas and NGL sales
|
$ | 879 | $ | 786 | ||||
Joint interest billings
|
245 | 204 | ||||||
Marketing and midstream revenues
|
136 | 165 | ||||||
Other
|
195 | 57 | ||||||
|
||||||||
Gross accounts receivable
|
1,455 | 1,212 | ||||||
Allowance for doubtful accounts
|
(9 | ) | (10 | ) | ||||
|
||||||||
Net accounts receivable
|
$ | 1,446 | $ | 1,202 | ||||
|
10
Production | ||||||||||||||||||||||||||||
Period | Price Swaps | Price Collars | Call Options Sold | |||||||||||||||||||||||||
Weighted | Weighted | Weighted | Weighted | |||||||||||||||||||||||||
Volume | Average Price | Volume | Average Floor Price | Average Ceiling Price | Volume | Average Price | ||||||||||||||||||||||
Period | (Bbls/d) | ($/Bbl) | (Bbls/d) | ($/Bbl) | ($/Bbl) | (Bbls/d) | ($/Bbl) | |||||||||||||||||||||
Q3-Q4 2011
|
— | — | 45,000 | $ | 75.00 | $ | 108.89 | 19,500 | $ | 95.00 | ||||||||||||||||||
Q1-Q4 2012
|
22,000 | $ | 107.17 | 54,000 | $ | 85.74 | $ | 126.42 | 19,500 | $ | 95.00 | |||||||||||||||||
Q1-Q4 2013
|
— | — | 7,000 | $ | 90.00 | $ | 125.12 | — | — |
11
Production | ||||||||||||||||||||||||||||
Period | Price Swaps | Price Collars | Call Options Sold | |||||||||||||||||||||||||
Weighted | Weighted | Weighted | Weighted | |||||||||||||||||||||||||
Volume | Average Price | Volume | Average Floor Price | Average Ceiling Price | Volume | Average Price | ||||||||||||||||||||||
Period | (MMBtu/d) | ($/MMBtu) | (MMBtu/d) | ($/MMBtu) | ($/MMBtu) | (MMBtu/d) | ($/MMBtu) | |||||||||||||||||||||
Q3-Q4 2011
|
712,500 | $ | 5.51 | 215,000 | 4.75 | 5.17 | — | — | ||||||||||||||||||||
Q1-Q4 2012
|
325,000 | $ | 5.09 | 490,000 | 4.75 | 5.57 | 487,500 | $ | 6.00 |
Basis Swaps | ||||||||||||
Weighted Average | ||||||||||||
Differential to | ||||||||||||
Volume | Henry Hub | |||||||||||
Production Period | Index | (MMBtu/d) | ($/MMBtu) | |||||||||
Q3-Q4 2011
|
Panhandle Eastern Pipeline | 150,000 | $ | (0.33 | ) |
NGL Basis Swaps | ||||||||||||
Weighted Average | ||||||||||||
Volume | Differential to WTI | |||||||||||
Production Period | Pay | (Bbls/d) | ($/Bbl) | |||||||||
Q3-Q4 2011
|
Natural Gasoline | 416 | $ | (9.75 | ) | |||||||
Q1-Q4 2012
|
Natural Gasoline | 500 | $ | (10.10 | ) | |||||||
Q1-Q4 2013
|
Natural Gasoline | 500 | $ | (6.80 | ) |
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) | ||||||||||||
$950
|
3.92 | % | Three month LIBOR | July 7, 2011 |
U.S. Treasury Locks | ||||||||||||||
Fixed Rate | Variable | |||||||||||||
Notional | Paid | Rate Received | Expiration | |||||||||||
(In millions) | ||||||||||||||
$350
|
1.56 | % | Five year U.S. Treasury | July 6, 2011 | ||||||||||
300
|
2.96 | % | Ten year U.S. Treasury | July 6, 2011 | ||||||||||
$650
|
2.21 | % | ||||||||||||
12
Balance Sheet Caption | June 30, 2011 | December 31, 2010 | ||||||||||
(In millions) | ||||||||||||
Asset derivatives:
|
||||||||||||
Commodity derivatives
|
Other current assets | $ | 240 | $ | 248 | |||||||
Commodity derivatives
|
Other long-term assets | 81 | 1 | |||||||||
Interest rate derivatives
|
Other current assets | 78 | 100 | |||||||||
Interest rate derivatives
|
Other long-term assets | 33 | 40 | |||||||||
|
||||||||||||
Total asset derivatives
|
$ | 432 | $ | 389 | ||||||||
|
||||||||||||
Liability derivatives:
|
||||||||||||
Commodity derivatives
|
Other current liabilities | $ | 83 | $ | 50 | |||||||
Commodity derivatives
|
Other long-term liabilities | 78 | 142 | |||||||||
|
||||||||||||
Total liability derivatives
|
$ | 161 | $ | 192 | ||||||||
|
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||||
(In millions) | ||||||||||||||||
Cash settlements:
|
||||||||||||||||
Commodity derivatives
|
$ | 59 | $ | 252 | $ | 145 | $ | 348 | ||||||||
Interest rate derivatives
|
5 | 4 | 21 | 20 | ||||||||||||
|
||||||||||||||||
Total cash settlements
|
64 | 256 | 166 | 368 | ||||||||||||
|
||||||||||||||||
|
||||||||||||||||
Unrealized gains (losses):
|
||||||||||||||||
Commodity derivatives
|
357 | (207 | ) | 103 | 317 | |||||||||||
Interest rate derivatives
|
(30 | ) | (85 | ) | (29 | ) | (86 | ) | ||||||||
|
||||||||||||||||
Total unrealized gains (losses)
|
327 | (292 | ) | 74 | 231 | |||||||||||
|
||||||||||||||||
Net gain (loss) recognized on
statement of operations
|
$ | 391 | $ | (36 | ) | $ | 240 | $ | 599 | |||||||
|
June 30, 2011 | December 31, 2010 | |||||||
(In millions) | ||||||||
Derivative financial instruments
|
$ | 318 | $ | 348 | ||||
Income taxes receivable
|
206 | 270 | ||||||
Inventories
|
137 | 120 | ||||||
Other
|
50 | 41 | ||||||
|
||||||||
Other current assets
|
$ | 711 | $ | 779 | ||||
|
13
14
Six Months | ||||||||
Ended June 30, | ||||||||
2011 | 2010 | |||||||
(In millions) | ||||||||
Asset retirement obligations as of beginning of period
|
$ | 1,497 | $ | 1,513 | ||||
Liabilities incurred
|
23 | 25 | ||||||
Liabilities settled
|
(39 | ) | (71 | ) | ||||
Revision of estimated obligation
|
16 | 194 | ||||||
Liabilities assumed by others
|
— | (256 | ) | |||||
Accretion expense on discounted obligation
|
46 | 50 | ||||||
Foreign currency translation adjustment
|
28 | (14 | ) | |||||
|
||||||||
Asset retirement obligations as of end of period
|
1,571 | 1,441 | ||||||
Less current portion
|
72 | 95 | ||||||
|
||||||||
Asset retirement obligations, long-term
|
$ | 1,499 | $ | 1,346 | ||||
|
Pension Benefits | Other Postretirement Benefits | |||||||||||||||||||||||||||||||
Three Months | Six Months | Three Months | Six Months | |||||||||||||||||||||||||||||
Ended June 30, | Ended June 30, | Ended June 30, | Ended June 30, | |||||||||||||||||||||||||||||
2011 | 2010 | 2011 | 2010 | 2011 | 2010 | 2011 | 2010 | |||||||||||||||||||||||||
(In millions) | ||||||||||||||||||||||||||||||||
Service cost
|
$ | 9 | $ | 8 | $ | 18 | $ | 16 | $ | 1 | $ | — | $ | 1 | $ | — | ||||||||||||||||
Interest cost
|
15 | 14 | 30 | 28 | — | 1 | 1 | 2 | ||||||||||||||||||||||||
Expected return on plan assets
|
(11 | ) | (9 | ) | (21 | ) | (18 | ) | — | — | — | — | ||||||||||||||||||||
Amortization of prior service cost
|
1 | 1 | 2 | 2 | (1 | ) | — | (1 | ) | — | ||||||||||||||||||||||
Net actuarial loss
|
8 | 7 | 16 | 14 | — | — | — | — | ||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Net periodic benefit cost
|
$ | 22 | $ | 21 | $ | 45 | $ | 42 | $ | — | $ | 1 | $ | 1 | $ | 2 | ||||||||||||||||
|
15
16
Fair Value Measurements Using : | ||||||||||||||||||||
Carrying | Total Fair | Level 1 | Level 2 | Level 3 | ||||||||||||||||
Amount | Value | Inputs | Inputs | Inputs | ||||||||||||||||
(In millions) | ||||||||||||||||||||
June 30, 2011 assets (liabilities):
|
||||||||||||||||||||
Short-term investments
|
$ | 3,367 | $ | 3,367 | $ | 3,367 | $ | — | $ | — | ||||||||||
Long-term investments
|
$ | 93 | $ | 93 | $ | — | $ | — | $ | 93 | ||||||||||
Commodity derivatives
|
$ | 321 | $ | 321 | $ | — | $ | 321 | $ | — | ||||||||||
Commodity derivatives
|
$ | (161 | ) | $ | (161 | ) | $ | — | $ | (161 | ) | $ | — | |||||||
Interest rate derivatives
|
$ | 111 | $ | 111 | $ | — | $ | 111 | $ | — | ||||||||||
Debt
|
$ | (7,930 | ) | $ | (8,867 | ) | $ | (2,340 | ) | $ | (6,423 | ) | $ | (104 | ) |
Fair Value Measurements Using : | ||||||||||||||||||||
Carrying | Total Fair | Level 1 | Level 2 | Level 3 | ||||||||||||||||
Amount | Value | Inputs | Inputs | Inputs | ||||||||||||||||
(In millions) | ||||||||||||||||||||
December 31, 2010 assets (liabilities):
|
||||||||||||||||||||
Short-term investments
|
$ | 145 | $ | 145 | $ | 145 | $ | — | $ | — | ||||||||||
Long-term investments
|
$ | 94 | $ | 94 | $ | — | $ | — | $ | 94 | ||||||||||
Commodity derivatives
|
$ | 249 | $ | 249 | $ | — | $ | 249 | $ | — | ||||||||||
Commodity derivatives
|
$ | (192 | ) | $ | (192 | ) | $ | — | $ | (192 | ) | $ | — | |||||||
Interest rate derivatives
|
$ | 140 | $ | 140 | $ | — | $ | 140 | $ | — | ||||||||||
Debt
|
$ | (5,630 | ) | $ | (6,629 | ) | $ | — | $ | (6,485 | ) | $ | (144 | ) |
17
Six Months | ||||||||
Ended June 30, | ||||||||
2011 | 2010 | |||||||
(In millions) | ||||||||
Long-term investments balance at beginning of period
|
$ | 94 | $ | 115 | ||||
Redemptions of principal
|
(1 | ) | (18 | ) | ||||
|
||||||||
Long-term investments balance at end of period
|
$ | 93 | $ | 97 | ||||
|
Six Months | ||||||||
Ended June 30, | ||||||||
2011 | 2010 | |||||||
(In millions) | ||||||||
Debt balance at beginning of period
|
$ | (144 | ) | $ | — | |||
Issuance of promissory note
|
— | (139 | ) | |||||
Foreign exchange translation adjustment
|
(4 | ) | — | |||||
Accretion of promissory note
|
(2 | ) | — | |||||
Redemptions of principal
|
46 | — | ||||||
|
||||||||
Debt balance at end of period
|
$ | (104 | ) | $ | (139 | ) | ||
|
Continuing Operations | Discontinued Operations | |||||||||||||||||||||||
Other | Other | Other | Other | |||||||||||||||||||||
Current | Long-Term | Current | Long-Term | |||||||||||||||||||||
Liabilities | Liabilities | Total | Liabilities | Liabilities | Total | |||||||||||||||||||
(In millions) | ||||||||||||||||||||||||
Balance as of December 31, 2010
|
$ | 31 | $ | 51 | $ | 82 | $ | 16 | $ | — | $ | 16 | ||||||||||||
Cash severance settled
|
(16 | ) | — | (16 | ) | (4 | ) | — | (4 | ) | ||||||||||||||
Lease obligations settled
|
(1 | ) | (7 | ) | (8 | ) | — | — | — | |||||||||||||||
Lease obligations revision
|
(1 | ) | (1 | ) | (2 | ) | — | — | — | |||||||||||||||
Cash severance revision
|
1 | — | 1 | (2 | ) | — | (2 | ) | ||||||||||||||||
|
||||||||||||||||||||||||
Balance as of June 30, 2011
|
$ | 14 | $ | 43 | $ | 57 | $ | 10 | $ | — | $ | 10 | ||||||||||||
|
||||||||||||||||||||||||
|
||||||||||||||||||||||||
Balance as of December 31, 2009
|
$ | 61 | $ | — | $ | 61 | $ | 23 | $ | — | $ | 23 | ||||||||||||
Cash severance settled
|
(5 | ) | — | (5 | ) | (1 | ) | — | (1 | ) | ||||||||||||||
Cash severance revision
|
(5 | ) | — | (5 | ) | (3 | ) | — | (3 | ) | ||||||||||||||
|
||||||||||||||||||||||||
Balance as of June 30, 2010
|
$ | 51 | $ | — | $ | 51 | $ | 19 | $ | — | $ | 19 | ||||||||||||
|
18
Three Months Ended June 30, 2011 | Six Months Ended June 30, 2011 | |||||||||||||||||||||||
Continuing | Discontinued | Continuing | Discontinued | |||||||||||||||||||||
Operations | Operations | Total | Operations | Operations | Total | |||||||||||||||||||
(In millions) | ||||||||||||||||||||||||
Cash severance
|
$ | 1 | $ | (8 | ) | $ | (7 | ) | $ | 1 | $ | (2 | ) | $ | (1 | ) | ||||||||
Asset impairments
|
2 | — | 2 | 2 | — | 2 | ||||||||||||||||||
Lease obligations
|
2 | — | 2 | (2 | ) | — | (2 | ) | ||||||||||||||||
Share-based awards
|
— | — | — | (1 | ) | — | (1 | ) | ||||||||||||||||
Other
|
1 | — | 1 | 1 | — | 1 | ||||||||||||||||||
|
||||||||||||||||||||||||
Restructuring costs
|
$ | 6 | $ | (8 | ) | $ | (2 | ) | $ | 1 | $ | (2 | ) | $ | (1 | ) | ||||||||
|
Three Months Ended June 30, 2010 | Six Months Ended June 30, 2010 | |||||||||||||||||||||||
Continuing | Discontinued | Continuing | Discontinued | |||||||||||||||||||||
Operations | Operations | Total | Operations | Operations | Total | |||||||||||||||||||
(In millions) | ||||||||||||||||||||||||
Cash severance
|
$ | (5 | ) | $ | (3 | ) | $ | (8 | ) | $ | (5 | ) | $ | (3 | ) | $ | (8 | ) | ||||||
Share-based awards
|
(4 | ) | (2 | ) | (6 | ) | (4 | ) | (2 | ) | (6 | ) | ||||||||||||
Other
|
1 | — | 1 | 1 | — | 1 | ||||||||||||||||||
|
||||||||||||||||||||||||
Restructuring costs
|
$ | (8 | ) | $ | (5 | ) | $ | (13 | ) | $ | (8 | ) | $ | (5 | ) | $ | (13 | ) | ||||||
|
19
Second Quarter 2011 | Third Quarter 2010 | Second Quarter 2010 | ||||||||||||||||||||||
After | After | After | ||||||||||||||||||||||
Gross | Taxes | Gross | Taxes | Gross | Taxes | |||||||||||||||||||
(In millions) | ||||||||||||||||||||||||
Brazil
|
$ | 2,546 | $ | 2,546 | $ | — | $ | — | $ | — | $ | — | ||||||||||||
Azerbaijan
|
— | — | 1,543 | 1,524 | — | — | ||||||||||||||||||
China — Panyu
|
— | — | — | — | 308 | 235 | ||||||||||||||||||
Other
|
— | — | (8 | ) | (2 | ) | — | — | ||||||||||||||||
|
||||||||||||||||||||||||
Total
|
$ | 2,546 | $ | 2,546 | $ | 1,535 | $ | 1,522 | $ | 308 | $ | 235 | ||||||||||||
|
June 30, | December 31, | |||||||
2011 | 2010 | |||||||
(In millions) | ||||||||
Cash and cash equivalents
|
$ | — | $ | 424 | ||||
Accounts receivable
|
2 | 43 | ||||||
Other current assets
|
34 | 96 | ||||||
|
||||||||
Current assets
|
$ | 36 | $ | 563 | ||||
|
||||||||
|
||||||||
Property and equipment, net
|
$ | 92 | $ | 848 | ||||
Other long-term assets
|
2 | 11 | ||||||
|
||||||||
Total long-term assets
|
$ | 94 | $ | 859 | ||||
|
||||||||
|
||||||||
Accounts payable
|
$ | 4 | $ | 260 | ||||
Other current liabilities
|
39 | 45 | ||||||
|
||||||||
Current liabilities
|
$ | 43 | $ | 305 | ||||
|
||||||||
|
||||||||
Long-term liabilities
|
$ | 2 | $ | 26 | ||||
|
Common | Earnings | |||||||||||
Earnings | Shares | per Share | ||||||||||
(In millions, except per share amounts) | ||||||||||||
Three Months Ended June 30, 2011:
|
||||||||||||
Earnings from continuing operations
|
$ | 184 | 422 | |||||||||
Attributable to participating securities
|
(2 | ) | (5 | ) | ||||||||
|
||||||||||||
Basic earnings per share
|
182 | 417 | $ | 0.44 | ||||||||
Dilutive effect of potential common shares issuable
upon the exercise of outstanding stock options
|
— | 2 | ||||||||||
|
||||||||||||
Diluted earnings per share
|
$ | 182 | 419 | $ | 0.43 | |||||||
|
20
Common | Earnings | |||||||||||
Earnings | Shares | per Share | ||||||||||
(In millions, except per share amounts) | ||||||||||||
Three Months Ended June 30, 2010:
|
||||||||||||
Earnings from continuing operations
|
$ | 352 | 445 | |||||||||
Attributable to participating securities
|
(4 | ) | (5 | ) | ||||||||
|
||||||||||||
Basic earnings per share
|
348 | 440 | $ | 0.79 | ||||||||
Dilutive effect of potential common shares issuable
upon the exercise of outstanding stock options
|
— | 1 | ||||||||||
|
||||||||||||
Diluted earnings per share
|
$ | 348 | 441 | $ | 0.79 | |||||||
|
||||||||||||
|
||||||||||||
Six Months Ended June 30, 2011:
|
||||||||||||
Earnings from continuing operations
|
$ | 573 | 425 | |||||||||
Attributable to participating securities
|
(6 | ) | (5 | ) | ||||||||
|
||||||||||||
Basic earnings per share
|
567 | 420 | $ | 1.35 | ||||||||
Dilutive effect of potential common shares issuable
upon the exercise of outstanding stock options
|
— | 2 | ||||||||||
|
||||||||||||
Diluted earnings per share
|
$ | 567 | 422 | $ | 1.34 | |||||||
|
||||||||||||
|
||||||||||||
Six Months Ended June 30, 2010:
|
||||||||||||
Earnings from continuing operations
|
$ | 1,426 | 446 | |||||||||
Attributable to participating securities
|
(17 | ) | (5 | ) | ||||||||
|
||||||||||||
Basic earnings per share
|
1,409 | 441 | $ | 3.20 | ||||||||
Dilutive effect of potential common shares issuable
upon the exercise of outstanding stock options
|
— | 1 | ||||||||||
|
||||||||||||
Diluted earnings per share
|
$ | 1,409 | 442 | $ | 3.19 | |||||||
|
21
U.S. | Canada | International | Total | |||||||||||||
(In millions) | ||||||||||||||||
As of June 30, 2011:
|
||||||||||||||||
Current assets (1)
|
$ | 1,916 | $ | 6,959 | $ | 36 | $ | 8,911 | ||||||||
Property and equipment, net
|
14,472 | 7,955 | — | 22,427 | ||||||||||||
Goodwill
|
3,046 | 3,130 | — | 6,176 | ||||||||||||
Other assets
|
538 | 391 | 94 | 1,023 | ||||||||||||
|
||||||||||||||||
Total assets
|
$ | 19,972 | $ | 18,435 | $ | 130 | $ | 38,537 | ||||||||
|
||||||||||||||||
|
||||||||||||||||
Current liabilities
|
$ | 1,995 | $ | 2,446 | $ | 43 | $ | 4,484 | ||||||||
Long-term debt
|
4,725 | 1,243 | — | 5,968 | ||||||||||||
Asset retirement obligations
|
578 | 921 | — | 1,499 | ||||||||||||
Other liabilities
|
742 | 66 | 2 | 810 | ||||||||||||
Deferred income taxes
|
2,939 | 1,409 | — | 4,348 | ||||||||||||
Stockholders’ equity
|
8,993 | 12,350 | 85 | 21,428 | ||||||||||||
|
||||||||||||||||
Total liabilities and stockholders’ equity
|
$ | 19,972 | $ | 18,435 | $ | 130 | $ | 38,537 | ||||||||
|
(1) | Current assets in the Canadian segment include $6.1 billion of cash, cash equivalents and short-term investments that were generated from Devon’s International offshore divestiture program and have not been repatriated to the United States. |
22
U.S. | Canada | Total | ||||||||||
(In millions) | ||||||||||||
Three Months Ended June 30, 2011:
|
||||||||||||
Revenues:
|
||||||||||||
Oil, gas and NGL sales
|
$ | 1,438 | $ | 762 | $ | 2,200 | ||||||
Oil, gas and NGL derivatives
|
416 | — | 416 | |||||||||
Marketing and midstream revenues
|
554 | 50 | 604 | |||||||||
|
||||||||||||
Total revenues
|
2,408 | 812 | 3,220 | |||||||||
|
||||||||||||
Expenses and other, net:
|
||||||||||||
Lease operating expenses
|
224 | 229 | 453 | |||||||||
Taxes other than income taxes
|
107 | 13 | 120 | |||||||||
Marketing and midstream operating costs and expenses
|
413 | 43 | 456 | |||||||||
Depreciation, depletion and amortization of oil and gas
properties
|
291 | 194 | 485 | |||||||||
Depreciation and amortization of non-oil and gas properties
|
59 | 6 | 65 | |||||||||
Accretion of asset retirement obligations
|
8 | 15 | 23 | |||||||||
General and administrative expenses
|
94 | 41 | 135 | |||||||||
Restructuring costs
|
6 | — | 6 | |||||||||
Interest expense
|
40 | 45 | 85 | |||||||||
Interest-rate and other financial instruments
|
25 | — | 25 | |||||||||
Other, net
|
(7 | ) | (4 | ) | (11 | ) | ||||||
|
||||||||||||
Total expenses and other, net
|
1,260 | 582 | 1,842 | |||||||||
|
||||||||||||
Earnings from continuing operations before income taxes
|
1,148 | 230 | 1,378 | |||||||||
Income tax expense:
|
||||||||||||
Current
|
35 | 1 | 36 | |||||||||
Deferred
|
1,100 | 58 | 1,158 | |||||||||
|
||||||||||||
Total income tax expense
|
1,135 | 59 | 1,194 | |||||||||
|
||||||||||||
Earnings from continuing operations
|
$ | 13 | $ | 171 | $ | 184 | ||||||
|
||||||||||||
|
||||||||||||
Capital expenditures, continuing operations
|
$ | 1,499 | $ | 334 | $ | 1,833 | ||||||
|
23
U.S. | Canada | Total | ||||||||||
(In millions) | ||||||||||||
Three Months Ended June 30, 2010:
|
||||||||||||
Revenues:
|
||||||||||||
Oil, gas and NGL sales
|
$ | 1,144 | $ | 638 | $ | 1,782 | ||||||
Oil, gas and NGL derivatives
|
32 | 13 | 45 | |||||||||
Marketing and midstream revenues
|
372 | 33 | 405 | |||||||||
|
||||||||||||
Total revenues
|
1,548 | 684 | 2,232 | |||||||||
|
||||||||||||
Expenses and other, net:
|
||||||||||||
Lease operating expenses
|
243 | 199 | 442 | |||||||||
Taxes other than income taxes
|
83 | 9 | 92 | |||||||||
Marketing and midstream operating costs and expenses
|
252 | 28 | 280 | |||||||||
Depreciation, depletion and amortization of oil and gas
properties
|
248 | 178 | 426 | |||||||||
Depreciation and amortization of non-oil and gas properties
|
57 | 6 | 63 | |||||||||
Accretion of asset retirement obligations
|
12 | 12 | 24 | |||||||||
General and administrative expenses
|
98 | 32 | 130 | |||||||||
Restructuring costs
|
(8 | ) | — | (8 | ) | |||||||
Interest expense
|
55 | 56 | 111 | |||||||||
Interest-rate and other financial instruments
|
81 | — | 81 | |||||||||
Other, net
|
(26 | ) | 4 | (22 | ) | |||||||
|
||||||||||||
Total expenses and other, net
|
1,095 | 524 | 1,619 | |||||||||
|
||||||||||||
Earnings from continuing operations before income taxes
|
453 | 160 | 613 | |||||||||
Income tax expense (benefit):
|
||||||||||||
Current
|
631 | 76 | 707 | |||||||||
Deferred
|
(421 | ) | (25 | ) | (446 | ) | ||||||
|
||||||||||||
Total income tax expense
|
210 | 51 | 261 | |||||||||
|
||||||||||||
Earnings from continuing operations
|
$ | 243 | $ | 109 | $ | 352 | ||||||
|
||||||||||||
|
||||||||||||
Capital expenditures, continuing operations
|
$ | 1,145 | $ | 774 | $ | 1,919 | ||||||
|
24
U.S. | Canada | Total | ||||||||||
(In millions) | ||||||||||||
Six Months Ended June 30, 2011:
|
||||||||||||
Revenues:
|
||||||||||||
Oil, gas and NGL sales
|
$ | 2,650 | $ | 1,410 | $ | 4,060 | ||||||
Oil, gas and NGL derivatives
|
248 | — | 248 | |||||||||
Marketing and midstream revenues
|
977 | 82 | 1,059 | |||||||||
|
||||||||||||
Total revenues
|
3,875 | 1,492 | 5,367 | |||||||||
|
||||||||||||
Expenses and other, net:
|
||||||||||||
Lease operating expenses
|
432 | 445 | 877 | |||||||||
Taxes other than income taxes
|
201 | 27 | 228 | |||||||||
Marketing and midstream operating costs and expenses
|
721 | 68 | 789 | |||||||||
Depreciation, depletion and amortization of oil and gas
properties
|
551 | 376 | 927 | |||||||||
Depreciation and amortization of non-oil and gas properties
|
117 | 12 | 129 | |||||||||
Accretion of asset retirement obligations
|
17 | 29 | 46 | |||||||||
General and administrative expenses
|
185 | 80 | 265 | |||||||||
Restructuring costs
|
1 | — | 1 | |||||||||
Interest expense
|
77 | 89 | 166 | |||||||||
Interest-rate and other financial instruments
|
8 | — | 8 | |||||||||
Other, net
|
(21 | ) | (6 | ) | (27 | ) | ||||||
|
||||||||||||
Total expenses and other, net
|
2,289 | 1,120 | 3,409 | |||||||||
|
||||||||||||
Earnings from continuing operations before income taxes
|
1,586 | 372 | 1,958 | |||||||||
Income tax (benefit) expense:
|
||||||||||||
Current
|
(53 | ) | — | (53 | ) | |||||||
Deferred
|
1,343 | 95 | 1,438 | |||||||||
|
||||||||||||
Total income tax expense
|
1,290 | 95 | 1,385 | |||||||||
|
||||||||||||
Earnings from continuing operations
|
$ | 296 | $ | 277 | $ | 573 | ||||||
|
||||||||||||
|
||||||||||||
Capital expenditures, before revision of future asset
retirement
obligations
|
$ | 2,749 | $ | 866 | $ | 3,615 | ||||||
Revision of future asset retirement obligations
|
2 | 14 | 16 | |||||||||
|
||||||||||||
Capital expenditures, continuing operations
|
$ | 2,751 | $ | 880 | $ | 3,631 | ||||||
|
25
U.S. | Canada | Total | ||||||||||
(In millions) | ||||||||||||
Six Months Ended June 30, 2010:
|
||||||||||||
Revenues:
|
||||||||||||
Oil, gas and NGL sales
|
$ | 2,514 | $ | 1,338 | $ | 3,852 | ||||||
Oil, gas and NGL derivatives
|
657 | 8 | 665 | |||||||||
Marketing and midstream revenues
|
868 | 67 | 935 | |||||||||
|
||||||||||||
Total revenues
|
4,039 | 1,413 | 5,452 | |||||||||
|
||||||||||||
Expenses and other, net:
|
||||||||||||
Lease operating expenses
|
467 | 389 | 856 | |||||||||
Taxes other than income taxes
|
173 | 20 | 193 | |||||||||
Marketing and midstream operating costs and expenses
|
621 | 56 | 677 | |||||||||
Depreciation, depletion and amortization of oil and gas
properties
|
509 | 343 | 852 | |||||||||
Depreciation and amortization of non-oil and gas properties
|
113 | 13 | 126 | |||||||||
Accretion of asset retirement obligations
|
25 | 25 | 50 | |||||||||
General and administrative expenses
|
206 | 62 | 268 | |||||||||
Restructuring costs
|
(8 | ) | — | (8 | ) | |||||||
Interest expense
|
85 | 112 | 197 | |||||||||
Interest-rate and other financial instruments
|
66 | — | 66 | |||||||||
Other, net
|
(29 | ) | 3 | (26 | ) | |||||||
|
||||||||||||
Total expenses and other, net
|
2,228 | 1,023 | 3,251 | |||||||||
|
||||||||||||
Earnings from continuing operations before income taxes
|
1,811 | 390 | 2,201 | |||||||||
Income tax expense (benefit):
|
||||||||||||
Current
|
845 | 161 | 1,006 | |||||||||
Deferred
|
(186 | ) | (45 | ) | (231 | ) | ||||||
|
||||||||||||
Total income tax expense
|
659 | 116 | 775 | |||||||||
|
||||||||||||
Earnings from continuing operations
|
$ | 1,152 | $ | 274 | $ | 1,426 | ||||||
|
||||||||||||
|
||||||||||||
Capital expenditures, before revision of future asset
retirement
obligations
|
$ | 2,189 | $ | 1,144 | $ | 3,333 | ||||||
Revision of future asset retirement obligations
|
72 | 122 | 194 | |||||||||
|
||||||||||||
Capital expenditures, continuing operations
|
$ | 2,261 | $ | 1,266 | $ | 3,527 | ||||||
|
Six Months | ||||||||
Ended June 30, | ||||||||
2011 | 2010 | |||||||
(In millions) | ||||||||
Net (increase) decrease in working capital:
|
||||||||
Increase in accounts receivable
|
$ | (100 | ) | $ | (1 | ) | ||
(Increase) decrease in other current assets
|
(41 | ) | 44 | |||||
Increase (decrease) in accounts payable
|
9 | (21 | ) | |||||
Increase (decrease) in revenues and royalties due to others
|
130 | (21 | ) | |||||
(Decrease) increase in other current liabilities
|
(87 | ) | 580 | |||||
|
||||||||
Net (increase) decrease in working capital
|
$ | (89 | ) | $ | 581 | |||
|
||||||||
|
||||||||
Supplementary cash flow data — total operations:
|
||||||||
Interest paid (net of capitalized interest)
|
$ | 160 | $ | 202 | ||||
Income taxes (received) paid
|
$ | (125 | ) | $ | 306 |
26
• | North America Onshore oil and NGL production increased 7% to 20 MMBbls and 5% to 39 MMBbls in the second quarter and first six months of 2011, respectively. | ||
• | North America Onshore gas production increased 4% to 240 Bcf and 5% to 468 Bcf in the second quarter and first six months of 2011, respectively. | ||
• | The combined realized price without hedges for oil, gas and NGLs increased 20% to $36.63 per Boe and 3% to $34.80 per Boe in the second quarter and first six months of 2011, respectively. | ||
• | Oil, gas and NGL derivatives generated cash receipts of $59 million and $145 million for the second quarter and first six months of 2011, respectively, and cash receipts of $252 million and $348 million in the second quarter and first six months of 2010, respectively. | ||
• | Marketing and midstream operating profit increased 19% to $148 million and 5% to $270 million in the second quarter and first six months of 2011, respectively. | ||
• | North America Onshore per unit operating costs increased 3% to $7.55 per Boe and 3% to $7.52 per Boe in the second quarter and first six months of 2011, respectively. | ||
• | Operating cash flow increased 11% to $1.6 billion in the second quarter of 2011 and decreased 3% to $2.8 billion in the first six months of 2011, respectively. | ||
• | Capital spending totaled approximately $3.7 billion in the first six months of 2011. |
27
• | In the Permian Basin, we increased production 17 percent over the second quarter of 2010, to 49 MBoe/d. Oil and natural gas liquids accounted for 75 percent of the Permian Basin’s second quarter production. | ||
• | We completed nine operated Bone Spring wells within the Permian Basin in the second quarter. Initial daily production from the nine wells averaged more than 700 Boe/d per well. We have an average working interest of 77 percent in these wells. | ||
• | In Canada, we commenced steam injection and achieved first production from our Jackfish 2 oil sands project in the second quarter. Production from the 100 percent-owned project is expected to ramp-up to 35 MBbls/d before royalties over the next 18 months. | ||
• | Production from our Cana-Woodford Shale play averaged a record 189 MMcfe/d in the second quarter, including nearly 9 MBbls/d of liquids. This represents an 80 percent increase in total production compared to the year-ago quarter. | ||
• | Our Barnett Shale production increased 13 percent over the second-quarter 2010 to a record 1.3 Bcfe/d, including 46 MBbls/d of liquids production. | ||
• | We brought 8 operated Granite Wash wells online in the second quarter. Initial production from these wells averaged 2 MBoe/d, including 200 Bbls/d of oil and 730 Bbls/d of natural gas liquids. We have an average working interest of 71 percent in these wells. | ||
• | We have assembled 1.1 million net acres targeting new oil and liquids-rich gas opportunities across multiple basins in the U.S. In 2011, we plan to drill more than 30 wells targeting the Tuscaloosa Marine Shale, Niobrara Shale, Mississippian Lime, Ohio Utica Shale and the A1 Carbonate and Utica Shale in Michigan. |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||
2011 | 2010 | Change (1) | 2011 | 2010 | Change (1) | |||||||||||||||||||
Oil Volumes (MMBbls)
|
||||||||||||||||||||||||
U.S. Onshore
|
5 | 3 | +27 | % | 8 | 6 | +26 | % | ||||||||||||||||
Canada
|
6 | 6 | -3 | % | 13 | 13 | -1 | % | ||||||||||||||||
|
||||||||||||||||||||||||
North America Onshore
|
11 | 9 | +7 | % | 21 | 19 | +8 | % | ||||||||||||||||
U.S. Offshore
|
— | 1 | -100 | % | — | 2 | -100 | % | ||||||||||||||||
|
||||||||||||||||||||||||
Total
|
11 | 10 | 0 | % | 21 | 21 | -2 | % | ||||||||||||||||
|
||||||||||||||||||||||||
Gas Volumes (Bcf)
|
||||||||||||||||||||||||
U.S. Onshore
|
184 | 173 | +6 | % | 361 | 339 | +7 | % | ||||||||||||||||
Canada
|
56 | 58 | -3 | % | 107 | 108 | -1 | % | ||||||||||||||||
|
||||||||||||||||||||||||
North America Onshore
|
240 | 231 | +4 | % | 468 | 447 | +5 | % | ||||||||||||||||
U.S. Offshore
|
— | 7 | -100 | % | — | 17 | -100 | % | ||||||||||||||||
|
||||||||||||||||||||||||
Total
|
240 | 238 | +1 | % | 468 | 464 | +1 | % | ||||||||||||||||
|
||||||||||||||||||||||||
NGLs Volumes (MMBbls)
|
||||||||||||||||||||||||
U.S. Onshore
|
8 | 7 | +20 | % | 16 | 14 | +18 | % | ||||||||||||||||
Canada
|
1 | 1 | -5 | % | 2 | 2 | -2 | % | ||||||||||||||||
|
||||||||||||||||||||||||
North America Onshore
|
9 | 8 | +17 | % | 18 | 16 | +16 | % | ||||||||||||||||
U.S. Offshore
|
— | — | -100 | % | — | — | -100 | % | ||||||||||||||||
|
||||||||||||||||||||||||
Total
|
9 | 8 | +15 | % | 18 | 16 | +13 | % | ||||||||||||||||
|
||||||||||||||||||||||||
Total Volumes (MMBoe)
|
||||||||||||||||||||||||
U.S. Onshore
|
43 | 39 | +11 | % | 84 | 76 | +10 | % | ||||||||||||||||
Canada
|
17 | 17 | -3 | % | 33 | 33 | -1 | % | ||||||||||||||||
|
||||||||||||||||||||||||
North America Onshore
|
60 | 56 | +6 | % | 117 | 109 | +7 | % | ||||||||||||||||
U.S. Offshore
|
— | 2 | -100 | % | — | 5 | -100 | % | ||||||||||||||||
|
||||||||||||||||||||||||
Total
|
60 | 58 | +3 | % | 117 | 114 | +2 | % | ||||||||||||||||
|
(1) | All percentage changes included in this table are based on actual figures rather than the rounded figures presented. |
28
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||
2011 (1) | 2010 (1) | Change | 2011 (1) | 2010 (1) | Change | |||||||||||||||||||
Oil Prices (per Bbl)
|
||||||||||||||||||||||||
U.S. Onshore
|
$ | 98.28 | $ | 74.65 | +32 | % | $ | 93.84 | $ | 74.73 | +26 | % | ||||||||||||
Canada
|
$ | 73.65 | $ | 54.43 | +35 | % | $ | 67.29 | $ | 58.36 | +15 | % | ||||||||||||
North America Onshore
|
$ | 83.31 | $ | 61.11 | +36 | % | $ | 77.32 | $ | 63.67 | +21 | % | ||||||||||||
U.S. Offshore
|
$ | — | $ | 79.09 | N/M | $ | — | $ | 77.81 | N/M | ||||||||||||||
Total
|
$ | 83.31 | $ | 62.35 | +34 | % | $ | 77.32 | $ | 64.93 | +19 | % | ||||||||||||
Gas Prices (per Mcf)
|
||||||||||||||||||||||||
U.S. Onshore
|
$ | 3.72 | $ | 3.47 | +7 | % | $ | 3.61 | $ | 4.05 | -11 | % | ||||||||||||
Canada
|
$ | 4.08 | $ | 3.99 | +2 | % | $ | 4.05 | $ | 4.50 | -10 | % | ||||||||||||
North America Onshore
|
$ | 3.80 | $ | 3.60 | +6 | % | $ | 3.71 | $ | 4.16 | -11 | % | ||||||||||||
U.S. Offshore
|
$ | — | $ | 4.39 | N/M | $ | — | $ | 5.12 | N/M | ||||||||||||||
Total
|
$ | 3.80 | $ | 3.62 | +5 | % | $ | 3.71 | $ | 4.19 | -12 | % | ||||||||||||
NGLs Prices (per Bbl)
|
||||||||||||||||||||||||
U.S. Onshore
|
$ | 40.43 | $ | 28.73 | +41 | % | $ | 38.04 | $ | 31.39 | +21 | % | ||||||||||||
Canada
|
$ | 58.80 | $ | 46.18 | +27 | % | $ | 56.49 | $ | 47.52 | +19 | % | ||||||||||||
North America Onshore
|
$ | 42.20 | $ | 30.81 | +37 | % | $ | 39.90 | $ | 33.31 | +20 | % | ||||||||||||
U.S. Offshore
|
$ | — | $ | 35.59 | N/M | $ | — | $ | 38.22 | N/M | ||||||||||||||
Total
|
$ | 42.20 | $ | 30.90 | +37 | % | $ | 39.90 | $ | 33.41 | +19 | % | ||||||||||||
Combined Prices (per Boe)
|
||||||||||||||||||||||||
U.S. Onshore
|
$ | 33.19 | $ | 26.77 | +24 | % | $ | 31.53 | $ | 29.71 | +6 | % | ||||||||||||
Canada
|
$ | 45.55 | $ | 37.08 | +23 | % | $ | 43.23 | $ | 40.62 | +6 | % | ||||||||||||
North America Onshore
|
$ | 36.63 | $ | 29.92 | +22 | % | $ | 34.80 | $ | 33.00 | +5 | % | ||||||||||||
U.S. Offshore
|
$ | — | $ | 46.17 | N/M | $ | — | $ | 49.06 | N/M | ||||||||||||||
Total
|
$ | 36.63 | $ | 30.49 | +20 | % | $ | 34.80 | $ | 33.70 | +3 | % |
(1) | The prices presented exclude any effects due to oil, gas and NGL derivatives. |
Oil | Gas | NGLs | Total | |||||||||||||
(In millions) | ||||||||||||||||
2010 sales
|
$ | 673 | $ | 861 | $ | 248 | $ | 1,782 | ||||||||
Changes due to volumes
|
(1 | ) | 9 | 37 | 45 | |||||||||||
Changes due to prices
|
225 | 43 | 105 | 373 | ||||||||||||
|
||||||||||||||||
2011 sales
|
$ | 897 | $ | 913 | $ | 390 | $ | 2,200 | ||||||||
|
Oil | Gas | NGLs | Total | |||||||||||||
(In millions) | ||||||||||||||||
2010 sales
|
$ | 1,383 | $ | 1,947 | $ | 522 | $ | 3,852 | ||||||||
Changes due to volumes
|
(26 | ) | 17 | 70 | 61 | |||||||||||
Changes due to prices
|
259 | (227 | ) | 115 | 147 | |||||||||||
|
||||||||||||||||
2011 sales
|
$ | 1,616 | $ | 1,737 | $ | 707 | $ | 4,060 | ||||||||
|
29
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||||
(In millions) | ||||||||||||||||
Cash receipts (payments):
|
||||||||||||||||
Gas derivatives
|
$ | 74 | $ | 252 | $ | 165 | $ | 348 | ||||||||
Oil derivatives
|
(16 | ) | — | (21 | ) | — | ||||||||||
NGL derivatives
|
1 | — | 1 | — | ||||||||||||
|
||||||||||||||||
Total cash settlements
|
59 | 252 | 145 | 348 | ||||||||||||
|
||||||||||||||||
Unrealized gains (losses) on fair value changes:
|
||||||||||||||||
Gas derivatives
|
49 | (331 | ) | (8 | ) | 189 | ||||||||||
Oil derivatives
|
308 | 124 | 110 | 128 | ||||||||||||
NGL derivatives
|
— | — | 1 | — | ||||||||||||
|
||||||||||||||||
Total unrealized gains (losses)
|
357 | (207 | ) | 103 | 317 | |||||||||||
|
||||||||||||||||
Oil, gas and NGL derivatives
|
$ | 416 | $ | 45 | $ | 248 | $ | 665 | ||||||||
|
Three Months Ended June 30, 2011 | ||||||||||||||||
Oil | Gas | NGLs | Total | |||||||||||||
(Per Bbl) | (Per Mcf) | (Per Bbl) | (Per Boe) | |||||||||||||
Realized price without hedges
|
$ | 83.31 | $ | 3.80 | $ | 42.20 | $ | 36.63 | ||||||||
Cash settlements of hedges
|
(1.49 | ) | 0.31 | 0.05 | 0.99 | |||||||||||
|
||||||||||||||||
Realized price, including cash settlements
|
$ | 81.82 | $ | 4.11 | $ | 42.25 | $ | 37.62 | ||||||||
|
30
Three Months Ended June 30, 2010 | ||||||||||||||||
Oil | Gas | NGLs | Total | |||||||||||||
(Per Bbl) | (Per Mcf) | (Per Bbl) | (Per Boe) | |||||||||||||
Realized price without hedges
|
$ | 62.35 | $ | 3.62 | $ | 30.90 | $ | 30.49 | ||||||||
Cash settlements of hedges
|
— | 1.06 | — | 4.31 | ||||||||||||
|
||||||||||||||||
Realized price, including cash settlements
|
$ | 62.35 | $ | 4.68 | $ | 30.90 | $ | 34.80 | ||||||||
|
Six Months Ended June 30, 2011 | ||||||||||||||||
Oil | Gas | NGLs | Total | |||||||||||||
(Per Bbl) | (Per Mcf) | (Per Bbl) | (Per Boe) | |||||||||||||
Realized price without hedges
|
$ | 77.32 | $ | 3.71 | $ | 39.90 | $ | 34.80 | ||||||||
Cash settlements of hedges
|
(1.00 | ) | 0.35 | 0.06 | 1.25 | |||||||||||
|
||||||||||||||||
Realized price, including cash settlements
|
$ | 76.32 | $ | 4.06 | $ | 39.96 | $ | 36.05 | ||||||||
|
Six Months Ended June 30, 2010 | ||||||||||||||||
Oil | Gas | NGLs | Total | |||||||||||||
(Per Bbl) | (Per Mcf) | (Per Bbl) | (Per Boe) | |||||||||||||
Realized price without hedges
|
$ | 64.93 | $ | 4.19 | $ | 33.41 | $ | 33.70 | ||||||||
Cash settlements of hedges
|
— | 0.75 | — | 3.04 | ||||||||||||
|
||||||||||||||||
Realized price, including cash settlements
|
$ | 64.93 | $ | 4.94 | $ | 33.41 | $ | 36.74 | ||||||||
|
31
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||
2011 | 2010 | Change (1) | 2011 | 2010 | Change (1) | |||||||||||||||||||
($ in millions) | ||||||||||||||||||||||||
Marketing and midstream:
|
||||||||||||||||||||||||
Revenues
|
$ | 604 | $ | 405 | +49 | % | $ | 1,059 | $ | 935 | +13 | % | ||||||||||||
Operating costs and expenses
|
456 | 280 | +63 | % | 789 | 677 | +16 | % | ||||||||||||||||
|
||||||||||||||||||||||||
Operating profit
|
$ | 148 | $ | 125 | +19 | % | $ | 270 | $ | 258 | +5 | % | ||||||||||||
|
(1) | All percentage changes included in this table are based on actual figures rather than the rounded figures presented. |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||
2011 | 2010 | Change (1) | 2011 | 2010 | Change (1) | |||||||||||||||||||
Lease operating expenses ($ in millions):
|
||||||||||||||||||||||||
U.S. Onshore
|
$ | 224 | $ | 216 | +4 | % | $ | 432 | $ | 407 | +6 | % | ||||||||||||
Canada
|
229 | 199 | +15 | % | 445 | 389 | +14 | % | ||||||||||||||||
|
||||||||||||||||||||||||
North America Onshore
|
453 | 415 | +9 | % | 877 | 796 | +10 | % | ||||||||||||||||
U.S. Offshore
|
— | 27 | -100 | % | — | 60 | -100 | % | ||||||||||||||||
|
||||||||||||||||||||||||
Total
|
$ | 453 | $ | 442 | +3 | % | $ | 877 | $ | 856 | +3 | % | ||||||||||||
|
||||||||||||||||||||||||
|
||||||||||||||||||||||||
Lease operating expenses per Boe:
|
||||||||||||||||||||||||
U.S. Onshore
|
$ | 5.18 | $ | 5.52 | -6 | % | $ | 5.15 | $ | 5.33 | -3 | % | ||||||||||||
Canada
|
$ | 13.71 | $ | 11.53 | +19 | % | $ | 13.63 | $ | 11.80 | +16 | % | ||||||||||||
North America Onshore
|
$ | 7.55 | $ | 7.36 | +3 | % | $ | 7.52 | $ | 7.28 | +3 | % | ||||||||||||
U.S. Offshore
|
$ | — | $ | 13.18 | N/M | $ | — | $ | 12.00 | N/M | ||||||||||||||
Total
|
$ | 7.55 | $ | 7.56 | 0 | % | $ | 7.52 | $ | 7.49 | 0 | % |
(1) | All percentage changes included in this table are based on actual figures rather than the rounded figures presented. |
32
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||
2011 | 2010 | Change (1) | 2011 | 2010 | Change (1) | |||||||||||||||||||
($ in millions) | ||||||||||||||||||||||||
Production
|
$ | 68 | $ | 46 | +48 | % | $ | 124 | $ | 105 | +18 | % | ||||||||||||
Ad valorem
|
51 | 46 | +10 | % | 101 | 86 | +17 | % | ||||||||||||||||
Other
|
1 | — | +175 | % | 3 | 2 | +62 | % | ||||||||||||||||
|
||||||||||||||||||||||||
Total
|
$ | 120 | $ | 92 | +30 | % | $ | 228 | $ | 193 | +18 | % | ||||||||||||
|
(1) | All percentage changes included in this table are based on actual figures rather than the rounded figures presented. |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||
2011 | 2010 | Change (1) | 2011 | 2010 | Change (1) | |||||||||||||||||||
Total production volumes (MMBoe)
|
60 | 58 | +3 | % | 117 | 114 | +2 | % | ||||||||||||||||
DD&A rate ($ per Boe)
|
$ | 8.08 | $ | 7.28 | +11 | % | $ | 7.95 | $ | 7.45 | +7 | % | ||||||||||||
|
||||||||||||||||||||||||
DD&A expense ($ in millions)
|
$ | 485 | $ | 426 | +14 | % | $ | 927 | $ | 852 | +9 | % | ||||||||||||
|
(1) | All percentage changes included in this table are based on actual figures rather than the rounded figures presented. |
Three Months Ended | Six Months Ended | |||||||
June 30, | June 30, | |||||||
2010 DD&A
|
$ | 426 | $ | 852 | ||||
Change due to rate
|
48 | 58 | ||||||
Change due to volumes
|
11 | 17 | ||||||
|
||||||||
2011 DD&A
|
$ | 485 | $ | 927 | ||||
|
33
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||
2011 | 2010 | Change (1) | 2011 | 2010 | Change (1) | |||||||||||||||||||
($ in millions) | ||||||||||||||||||||||||
Gross G&A
|
$ | 245 | $ | 240 | +3 | % | $ | 483 | $ | 485 | 0 | % | ||||||||||||
Capitalized G&A
|
(81 | ) | (81 | ) | +1 | % | (162 | ) | (161 | ) | +1 | % | ||||||||||||
Reimbursed G&A
|
(29 | ) | (29 | ) | 0 | % | (56 | ) | (56 | ) | 0 | % | ||||||||||||
|
||||||||||||||||||||||||
Net G&A
|
$ | 135 | $ | 130 | +4 | % | $ | 265 | $ | 268 | -1 | % | ||||||||||||
|
(1) | All percentage changes included in this table are based on actual figures rather than the rounded figures presented. |
Three Months | Six Months | |||||||||||||||
Ended June 30, | Ended June 30, | |||||||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||||
(In millions) | ||||||||||||||||
Interest based on debt outstanding
|
$ | 100 | $ | 104 | $ | 198 | $ | 209 | ||||||||
Capitalized interest
|
(17 | ) | (14 | ) | (37 | ) | (35 | ) | ||||||||
Early retirement of debt
|
— | 19 | — | 19 | ||||||||||||
Other
|
2 | 2 | 5 | 4 | ||||||||||||
|
||||||||||||||||
Total interest expense
|
$ | 85 | $ | 111 | $ | 166 | $ | 197 | ||||||||
|
Three Months | Six Months | |||||||||||||||
Ended June 30, | Ended June 30, | |||||||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||||
(In millions) | ||||||||||||||||
(Gains) losses from interest rate swaps:
|
||||||||||||||||
Cash settlements
|
$ | (5 | ) | $ | (4 | ) | $ | (21 | ) | $ | (20 | ) | ||||
Unrealized fair value changes
|
30 | 85 | 29 | 86 | ||||||||||||
|
||||||||||||||||
Total
|
$ | 25 | $ | 81 | $ | 8 | $ | 66 | ||||||||
|
34
Three Months | Six Months | |||||||||||||||
Ended June 30, | Ended June 30, | |||||||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||||
Total income tax expense (in millions)
|
$ | 1,194 | $ | 261 | $ | 1,385 | $ | 775 | ||||||||
|
||||||||||||||||
|
||||||||||||||||
U.S. statutory income tax rate
|
35 | % | 35 | % | 35 | % | 35 | % | ||||||||
State income taxes
|
1 | % | 3 | % | 1 | % | 1 | % | ||||||||
Taxation on Canadian operations
|
(2 | %) | (1 | %) | (2 | %) | (1 | %) | ||||||||
Assumed repatriations
|
54 | % | 8 | % | 38 | % | 2 | % | ||||||||
Other
|
(1 | %) | (2 | %) | (1 | %) | (2 | %) | ||||||||
|
||||||||||||||||
Effective income tax rate
|
87 | % | 43 | % | 71 | % | 35 | % | ||||||||
|
Three Months | Six Months | |||||||||||||||
Ended June 30, | Ended June 30, | |||||||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||||
Total production (MMBoe)
|
— | 3 | 1 | 6 | ||||||||||||
Combined price without hedges (per Boe)
|
$ | — | $ | 74.45 | $ | 81.94 | $ | 73.56 | ||||||||
(In millions) | ||||||||||||||||
Operating revenues
|
$ | — | $ | 222 | $ | 43 | $ | 434 | ||||||||
|
||||||||||||||||
Expenses and other, net:
|
||||||||||||||||
Operating expenses
|
7 | 56 | 33 | 133 | ||||||||||||
Gain on sale of oil and gas properties
|
(2,546 | ) | (308 | ) | (2,546 | ) | (308 | ) | ||||||||
Other, net
|
(19 | ) | 1 | (32 | ) | (1 | ) | |||||||||
|
||||||||||||||||
Total expenses and other, net
|
(2,558 | ) | (251 | ) | (2,545 | ) | (176 | ) | ||||||||
|
||||||||||||||||
Earnings before income taxes
|
2,558 | 473 | 2,588 | 610 | ||||||||||||
Income tax (benefit) expense
|
(1 | ) | 119 | 2 | 138 | |||||||||||
|
||||||||||||||||
Earnings from discontinued operations
|
$ | 2,559 | $ | 354 | $ | 2,586 | $ | 472 | ||||||||
|
35
Six Months Ended June 30, | ||||||||
2011 | 2010 | |||||||
(In millions) | ||||||||
Sources of cash and cash equivalents:
|
||||||||
Operating cash flow — continuing operations
|
$ | 2,830 | $ | 2,619 | ||||
Cash reclassified from discontinued operations
|
3,251 | 450 | ||||||
Commercial paper borrowings
|
2,340 | — | ||||||
Stock option exercises
|
96 | 15 | ||||||
Divestitures of property and equipment
|
5 | 4,129 | ||||||
Other
|
13 | 24 | ||||||
|
||||||||
Total sources of cash and cash equivalents
|
8,535 | 7,237 | ||||||
|
||||||||
Uses of cash and cash equivalents:
|
||||||||
Capital expenditures
|
(3,720 | ) | (3,221 | ) | ||||
Net purchases of short-term investments
|
(3,222 | ) | — | |||||
Repurchases of common stock
|
(1,290 | ) | (430 | ) | ||||
Dividends
|
(140 | ) | (142 | ) | ||||
Commercial paper repayments
|
— | (1,432 | ) | |||||
Debt repayments
|
— | (350 | ) | |||||
Other
|
(33 | ) | — | |||||
|
||||||||
Total uses of cash and cash equivalents
|
(8,405 | ) | (5,575 | ) | ||||
|
||||||||
Increase from continuing operations
|
130 | 1,662 | ||||||
(Decrease) increase from discontinued operations, net of
reclassifications to continuing operations
|
(101 | ) | 252 | |||||
Effect of foreign exchange rates
|
32 | (9 | ) | |||||
|
||||||||
Net increase in cash and cash equivalents
|
$ | 61 | $ | 1,905 | ||||
|
||||||||
Cash and cash equivalents at end of period
|
$ | 3,351 | $ | 2,916 | ||||
|
||||||||
Short-term investments at end of period
|
$ | 3,367 | $ | — | ||||
|
36
Six Months Ended June 30, | ||||||||
2011 | 2010 | |||||||
(In millions) | ||||||||
U.S. Onshore
|
$ | 2,375 | $ | 1,468 | ||||
Canada
|
936 | 1,202 | ||||||
|
||||||||
North America Onshore
|
3,311 | 2,670 | ||||||
U.S. Offshore
|
— | 287 | ||||||
|
||||||||
Total exploration and development
|
3,311 | 2,957 | ||||||
Midstream
|
151 | 108 | ||||||
Other
|
258 | 156 | ||||||
|
||||||||
Total continuing operations
|
$ | 3,720 | $ | 3,221 | ||||
|
37
38
39
Production | ||||||||||||||||||||||||||||
Period | Price Swaps | Price Collars | Call Options Sold | |||||||||||||||||||||||||
Weighted | Weighted | Weighted | Weighted | |||||||||||||||||||||||||
Volume | Average Price | Volume | Average Floor Price | Average Ceiling Price | Volume | Average Price | ||||||||||||||||||||||
Period | (Bbls/d) | ($/Bbl) | (Bbls/d) | ($/Bbl) | ($/Bbl) | (Bbls/d) | ($/Bbl) | |||||||||||||||||||||
Q3-Q4 2011
|
— | — | 45,000 | $ | 75.00 | $ | 108.89 | 19,500 | $ | 95.00 | ||||||||||||||||||
Q1-Q4 2012
|
22,000 | $ | 107.17 | 54,000 | $ | 85.74 | $ | 126.42 | 19,500 | $ | 95.00 | |||||||||||||||||
Q1-Q4 2013
|
— | — | 7,000 | $ | 90.00 | $ | 125.12 | — | — |
Production | ||||||||||||||||||||||||||||
Period | Price Swaps | Price Collars | Call Options Sold | |||||||||||||||||||||||||
Weighted | Weighted | Weighted | Weighted | |||||||||||||||||||||||||
Volume | Average Price | Volume | Average Floor Price | Average Ceiling Price | Volume | Average Price | ||||||||||||||||||||||
Period | (MMBtu/d) | ($/MMBtu) | (MMBtu/d) | ($/MMBtu) | ($/MMBtu) | (MMBtu/d) | ($/MMBtu) | |||||||||||||||||||||
Q3-Q4 2011
|
712,500 | $ | 5.51 | 215,000 | 4.75 | 5.17 | — | — | ||||||||||||||||||||
Q1-Q4 2012
|
325,000 | $ | 5.09 | 490,000 | 4.75 | 5.57 | 487,500 | $ | 6.00 |
Basis Swaps | ||||||||||||
Weighted Average | ||||||||||||
Differential to | ||||||||||||
Volume | Henry Hub | |||||||||||
Production Period | Index | (MMBtu/d) | ($/MMBtu) | |||||||||
Q3-Q4 2011
|
Panhandle Eastern Pipeline | 150,000 | $ | (0.33 | ) |
NGL Basis Swaps | ||||||||||||
Weighted Average | ||||||||||||
Volume | Differential to WTI | |||||||||||
Production Period | Pay | (Bbls/d) | ($/Bbl) | |||||||||
Q3-Q4 2011
|
Natural Gasoline | 416 | $ | (9.75 | ) | |||||||
Q1-Q4 2012
|
Natural Gasoline | 500 | $ | (10.10 | ) | |||||||
Q1-Q4 2013
|
Natural Gasoline | 500 | $ | (6.80 | ) |
40
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 | % |
|
41
Maximum Dollar Value | ||||||||||||
Total Number | of Shares that May Yet | |||||||||||
of Shares | Average Price | Be Purchased Under the | ||||||||||
2011 Period | Purchased (1) | Paid per Share | Plans or Programs (1) | |||||||||
(In millions) | ||||||||||||
April 1 — April 30
|
1,907,538 | $ | 88.81 | $ | 1,433 | |||||||
May 1 — May 31
|
2,217,710 | $ | 82.83 | $ | 1,250 | |||||||
June 1 — June 30
|
2,942,530 | $ | 79.08 | $ | 1,017 | |||||||
|
||||||||||||
Total
|
7,067,778 | $ | 82.88 | |||||||||
|
(1) | In May 2010, our Board of Directors approved a $3.5 billion share repurchase program. This program expires December 31, 2011. As of June 30, 2011, we had repurchased 33.5 million common shares for $2.5 billion, or $74.16 per share under this program. |
Exhibit | ||
Number | Description | |
31.1
|
Certification of principal executive officer 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 Section 906 of the Sarbanes-Oxley Act of 2002. | |
32.2
|
Certification of principal financial officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
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 |
42
DEVON ENERGY CORPORATION
|
||||
Date: August 3, 2011 | /s/ Jeffrey A. Agosta | |||
Jeffrey A. Agosta | ||||
Executive Vice President — Chief Financial Officer |
43
Exhibit
Number |
Description | |
31.1
|
Certification of principal executive officer 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 Section 906 of the Sarbanes-Oxley Act of 2002. | |
32.2
|
Certification of principal financial officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
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 |
44
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 |
---|
DIRECTORS | AGE | BIO | OTHER DIRECTOR MEMBERSHIPS |
---|
No information found
No Customers Found
Price
Yield
Owner | Position | Direct Shares | Indirect Shares |
---|