DEVON ENERGY CORP/DE, 10-Q filed on 11/1/2017
Quarterly Report
Document And Entity Information
In Millions, unless otherwise specified
9 Months Ended
Sep. 30, 2017
Oct. 18, 2017
Document And Entity Information [Abstract]
 
 
Document Type
10-Q 
 
Document Period End Date
Sep. 30, 2017 
 
Amendment Flag
false 
 
Trading Symbol
DVN 
 
Entity Registrant Name
DEVON ENERGY CORP/DE 
 
Entity Central Index Key
0001090012 
 
Current Fiscal Year End Date
--12-31 
 
Document Fiscal Year Focus
2017 
 
Entity Filer Category
Large Accelerated Filer 
 
Document Fiscal Period Focus
Q3 
 
Entity Common Stock, Shares Outstanding
 
525.5 
Consolidated Comprehensive Statements Of Earnings (USD $)
In Millions, except Per Share data, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
Income Statement [Abstract]
 
 
 
 
Oil, gas and NGL sales
$ 1,245 
$ 1,113 
$ 3,760 
$ 3,023 
Oil, gas and NGL derivatives
(144)
79 
214 
(30)
Marketing and midstream revenues
2,055 
1,690 
5,992 
4,503 
Asset dispositions and other
 
1,351 
10 
1,351 
Total revenues and other
3,156 
4,233 
9,976 
8,847 
Lease operating expenses
391 
355 
1,176 
1,215 
Marketing and midstream operating expenses
1,813 
1,480 
5,319 
3,884 
General and administrative expenses
153 
141 
498 
482 
Production and property taxes
71 
67 
227 
220 
Depreciation, depletion and amortization
400 
394 
1,162 
1,420 
Asset impairments
319 
4,851 
Restructuring and transaction costs
 
(5)
 
266 
Other operating items
 
17 
11 
41 
Total operating expenses
2,830 
2,768 
8,402 
12,379 
Operating income (loss)
326 
1,465 
1,574 
(3,532)
Net financing costs
127 
243 
370 
570 
Other nonoperating items
(73)
44 
(124)
150 
Earnings (loss) before income taxes
272 
1,178 
1,328 
(4,252)
Income tax expense (benefit)
25 
171 
51 
(228)
Net earnings (loss)
247 
1,007 
1,277 
(4,024)
Net earnings (loss) attributable to noncontrolling interests
19 
14 
59 
(391)
Net earnings (loss) attributable to Devon
228 
993 
1,218 
(3,633)
Net earnings (loss) per share attributable to Devon:
 
 
 
 
Basic
$ 0.43 
$ 1.90 
$ 2.32 
$ (7.22)
Diluted
$ 0.43 
$ 1.89 
$ 2.31 
$ (7.22)
Comprehensive earnings (loss):
 
 
 
 
Net earnings (loss)
247 
1,007 
1,277 
(4,024)
Other comprehensive earnings, net of tax:
 
 
 
 
Foreign currency translation
28 
Pension and postretirement plans
11 
14 
20 
Other
 
 
(2)
 
Other comprehensive earnings, net of tax
13 
13 
48 
Comprehensive earnings (loss)
253 
1,020 
1,290 
(3,976)
Comprehensive earnings (loss) attributable to noncontrolling interests
19 
14 
59 
(391)
Comprehensive earnings (loss) attributable to Devon
$ 234 
$ 1,006 
$ 1,231 
$ (3,585)
Consolidated Statements Of Cash Flows (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
Cash flows from operating activities:
 
 
 
 
Net earnings (loss)
$ 247 
$ 1,007 
$ 1,277 
$ (4,024)
Adjustments to reconcile net earnings (loss) to net cash from operating activities:
 
 
 
 
Depreciation, depletion and amortization
400 
394 
1,162 
1,420 
Asset impairments
319 
4,851 
Gains and losses on asset sales
(1,351)
(6)
(1,351)
Deferred income tax expense (benefit)
(14)
86 
(20)
(300)
Commodity derivatives
144 
(79)
(214)
30 
Cash settlements on commodity derivatives
24 
12 
43 
15 
Other derivatives and financial instruments
21 
16 
329 
Cash settlements on other derivatives and financial instruments
 
 
(148)
Asset retirement obligation accretion
16 
19 
47 
58 
Share-based compensation
33 
23 
122 
163 
Other
(85)
127 
(134)
(31)
Net change in working capital
137 
94 
208 
Change in long-term other assets
(3)
12 
10 
Change in long-term other liabilities
(10)
12 
12 
Net cash from operating activities
776 
727 
2,420 
1,237 
Cash flows from investing activities:
 
 
 
 
Capital expenditures
(735)
(421)
(2,203)
(1,659)
Acquisitions of property, equipment and businesses
(6)
(3)
(39)
(1,641)
Proceeds from sale of investment
 
 
190 
 
Divestitures of property and equipment
209 
1,680 
323 
1,889 
Other
(1)
34 
(5)
Net cash from investing activities
(533)
1,290 
(1,734)
(1,404)
Cash flows from financing activities:
 
 
 
 
Borrowings of long-term debt, net of issuance costs
413 
816 
2,208 
1,662 
Repayments of long-term debt
(571)
(2,173)
(1,950)
(2,722)
Payment of installment payable
 
 
(250)
 
Net short-term debt repayments
 
 
 
(626)
Early retirement of debt
 
(82)
(6)
(82)
Issuance of common stock
 
 
 
1,469 
Issuance of subsidiary units
414 
59 
486 
835 
Dividends paid on common stock
(30)
(32)
(95)
(190)
Contributions from noncontrolling interests
18 
146 
47 
152 
Distributions to noncontrolling interests
(84)
(77)
(247)
(224)
Shares exchanged for tax withholdings
(3)
(2)
(67)
(30)
Other
 
(1)
(2)
(7)
Net cash from financing activities
157 
(1,346)
124 
237 
Effect of exchange rate changes on cash
12 
(9)
12 
Net change in cash and cash equivalents
412 
662 
822 
75 
Cash and cash equivalents at beginning of period
2,369 
1,723 
1,959 
2,310 
Cash and cash equivalents at end of period
$ 2,781 
$ 2,385 
$ 2,781 
$ 2,385 
Consolidated Balance Sheets (USD $)
In Millions, unless otherwise specified
Sep. 30, 2017
Dec. 31, 2016
Current assets:
 
 
Cash and cash equivalents
$ 2,781 
$ 1,959 
Accounts receivable
1,462 
1,356 
Assets held for sale
 
193 
Other current assets
379 
264 
Total current assets
4,622 
3,772 
Oil and gas, based on full cost accounting:
 
 
Subject to amortization
78,470 
75,648 
Not subject to amortization
2,853 
3,437 
Total oil and gas
81,323 
79,085 
Midstream and other
11,097 
10,455 
Total property and equipment, at cost
92,420 
89,540 
Less accumulated depreciation, depletion and amortization
(75,338)
(73,350)
Property and equipment, net
17,082 
16,190 
Goodwill
3,964 
3,964 
Other long-term assets
1,891 
1,987 
Total assets
27,559 
25,913 
Current liabilities:
 
 
Accounts payable
797 
642 
Revenues and royalties payable
1,012 
908 
Short-term debt
20 1
 
Other current liabilities
1,003 
1,066 
Total current liabilities
2,832 
2,616 
Long-term debt
10,383 
10,154 
Asset retirement obligations
1,100 
1,226 
Other long-term liabilities
645 
894 
Deferred income taxes
665 
648 
Equity:
 
 
Common stock, $0.10 par value. Authorized 1.0 billion shares; issued 525 million and 523 million shares in 2017 and 2016, respectively
53 
52 
Additional paid-in capital
7,207 
7,237 
Accumulated deficit
(428)
(1,646)
Accumulated other comprehensive earnings
297 
284 
Total stockholders’ equity attributable to Devon
7,129 
5,927 
Noncontrolling interests
4,805 
4,448 
Total equity
11,934 
10,375 
Total liabilities and equity
$ 27,559 
$ 25,913 
Consolidated Balance Sheets (Parenthetical) (USD $)
Sep. 30, 2017
Dec. 31, 2016
Statement Of Financial Position [Abstract]
 
 
Common stock, par value (in dollars per share)
$ 0.10 
$ 0.10 
Common stock, shares authorized (in shares)
1,000,000,000 
1,000,000,000 
Common stock, shares issued (in shares)
525,000,000 
523,000,000 
Consolidated Statements Of Equity (USD $)
In Millions
Total
Common Stock [Member]
Additional Paid-In Capital [Member]
Retained Earnings (Accumulated Deficit) [Member]
Accumulated Other Comprehensive Earnings [Member]
Treasury Stock [Member]
Noncontrolling Interests [Member]
Balance at Dec. 31, 2015
$ 10,989 
$ 42 
$ 4,996 
$ 1,781 
$ 230 
 
$ 3,940 
Balance, shares at Dec. 31, 2015
 
418 
 
 
 
 
 
Net earnings (loss)
(4,024)
 
 
(3,633)
 
 
(391)
Other comprehensive earnings, net of tax
48 
 
 
 
48 
 
 
Restricted stock grants, net of cancellations, shares
 
 
 
 
 
 
Common stock repurchased
(23)
 
 
 
 
(23)
 
Common stock retired
 
 
(23)
 
 
23 
 
Common stock dividends
(190)
 
(65)
(125)
 
 
 
Common stock issued
2,127 
10 
2,117 
 
 
 
 
Common stock issued, shares
 
103 
 
 
 
 
 
Share-based compensation
142 
 
142 
 
 
 
 
Subsidiary equity transactions
1,216 
 
320 
 
 
 
896 
Distributions to noncontrolling interests
(224)
 
 
 
 
 
(224)
Balance at Sep. 30, 2016
10,061 
52 
7,487 
(1,977)
278 
 
4,221 
Balance, shares at Sep. 30, 2016
 
524 
 
 
 
 
 
Balance at Dec. 31, 2016
10,375 
52 
7,237 
(1,646)
284 
 
4,448 
Balance, shares at Dec. 31, 2016
 
523 
 
 
 
 
 
Net earnings (loss)
1,277 
 
 
1,218 
 
 
59 
Other comprehensive earnings, net of tax
13 
 
 
 
13 
 
 
Restricted stock grants, net of cancellations, value
 
 
 
 
 
Restricted stock grants, net of cancellations, shares
 
 
 
 
 
 
Common stock repurchased
(43)
 
 
 
 
(43)
 
Common stock retired
 
 
(43)
 
 
43 
 
Common stock dividends
(95)
 
(95)
 
 
 
 
Share-based compensation
96 
 
96 
 
 
 
 
Share-based compensation, shares
 
 
 
 
 
 
Subsidiary equity transactions
557 
 
12 
 
 
 
545 
Distributions to noncontrolling interests
(247)
 
 
 
 
 
(247)
Balance at Sep. 30, 2017
$ 11,934 
$ 53 
$ 7,207 
$ (428)
$ 297 
 
$ 4,805 
Balance, shares at Sep. 30, 2017
 
525 
 
 
 
 
 
Summary Of Significant Accounting Policies
Summary Of Significant Accounting Policies

1.Summary of Significant Accounting Policies

The accompanying unaudited interim financial statements and notes of Devon have been prepared pursuant to the rules and regulations of the SEC. Pursuant to such rules and regulations, certain disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been omitted. The accompanying unaudited interim financial statements and notes should be read in conjunction with the financial statements and notes included in Devon’s 2016 Annual Report on Form 10-K.

The accompanying unaudited interim financial statements furnished in this report reflect all adjustments that are, in the opinion of management, necessary for a fair statement of Devon’s results of operations and cash flows for the three-month and nine-month periods ended September 30, 2017 and 2016 and Devon’s financial position as of September 30, 2017.

Recently Adopted Accounting Standards

In January 2017, Devon adopted ASU 2016-09, Compensation – Stock Compensation (Topic 718), Improvements to Employee Share-Based Payment Accounting. Its objective is to simplify several aspects of the accounting for share-based payments, including income taxes when awards vest or are settled, statutory withholding and forfeitures. As the result of adoption, Devon made certain income tax presentation changes, most notably prospectively presenting excess tax benefits and deficiencies in the consolidated comprehensive statements of earnings and as operating cash flows in the consolidated statements of cash flows. Devon also retrospectively applied the new cash flow statement guidance dictating the presentation of shares exchanged for tax-withholding purposes as a financing activity. The adoption of the new guidance did not materially impact the consolidated financial statements for the nine months ended September 30, 2017 or previously reported financial information but could have a more material future impact.

In January 2017, the FASB issued ASU 2017-04, Intangibles – Goodwill And Other (Topic 350), Simplifying the Test for Goodwill Impairment ("ASU 2017-04"). ASU 2017-04 simplifies the accounting for goodwill impairments by eliminating the requirement to compare the implied fair value of goodwill with its carrying amount as part of step two of the goodwill impairment test. Under ASU 2017-04, an entity should perform its goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit's fair value. However, the impairment loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. ASU 2017-04 is effective for annual reporting periods beginning after December 15, 2019, including any interim impairment tests within those annual periods, with early application for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. In January 2017, Devon elected to early adopt ASU 2017-04, and the adoption had no impact on the consolidated financial statements. Devon will perform future goodwill impairment tests according to ASU 2017-04.

Issued Accounting Standards Not Yet Adopted

The FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606). This ASU will supersede the revenue recognition requirements in Topic 605, Revenue Recognition and industry-specific guidance in Subtopic 932-605, Extractive Activities – Oil and Gas – Revenue Recognition. This ASU provides guidance concerning the recognition and measurement of revenue from contracts with customers. Its objective is to increase the usefulness of information in the financial statements regarding the nature, timing and uncertainty of revenues. The effective date for ASU 2014-09 was delayed through the issuance of ASU 2015-14, Revenue from Contracts with Customers – Deferral of the Effective Date, to annual and interim periods beginning in 2018, with early adoption permitted in 2017. Devon has not early adopted this ASU. The ASU is required to be adopted using either the retrospective transition method, which requires restating previously reported results or the cumulative effect (modified retrospective) transition method, which utilizes a cumulative-effect adjustment to retained earnings in the period of adoption to account for prior period effects rather than restating previously reported results. Devon intends to use the cumulative effect transition method and does not anticipate this ASU will have a material impact on its balance sheet or related consolidated statements of earnings, equity or cash flows. However, Devon continues to evaluate the “gross versus net” presentation of certain revenues and associated expenses in its consolidated statements of earnings. Any presentation changes would have no impact on operating income, earnings or cash flows. Devon does not expect significant changes to its annual disclosures; however, Devon’s quarterly disclosures will expand upon adoption of this ASU. Devon has implemented a process to gather and provide the quarterly disclosures required by the ASU.

The FASB issued ASU 2016-02, Leases (Topic 842). This ASU will supersede the lease requirements in Topic 840, Leases. Its objective is to increase transparency and comparability among organizations. This ASU provides guidance requiring lessees to recognize most leases on their balance sheet. Lessor accounting does not significantly change, except for some changes made to align with new revenue recognition requirements. This ASU is effective for Devon beginning January 1, 2019 and will be applied using a modified retrospective transition method, which requires applying the new guidance to leases that exist or are entered into after the beginning of the earliest period in the financial statements. Early adoption is permitted, but Devon does not plan to early adopt. Devon is in the process of evaluating contracts and gathering the necessary terms and data elements for purposes of determining the impact this ASU will have on its consolidated financial statements and related disclosures. Recently, the FASB issued Proposed Accounting Standards Update (ASU) No. 2017-290, Leases (Topic 842), Land Easement Practical Expedient for Transition to Topic 842. This proposed ASU would permit an entity not to apply Topic 842 to land easements and rights-of-way that exist or expired before the effective date of Topic 842 and that were not previously assessed under Topic 840. An entity would continue to apply its current accounting policy for accounting for land easements that existed before the effective date of Topic 842. Once an entity adopts Topic 842, it would apply that Topic prospectively to all new (or modified) land easements and rights-of-way to determine whether the arrangement should be accounted for as a lease. For Devon, these contracts represent a relatively small percentage of the aggregate value of contracts being evaluated but represent a significant number of contracts.

Based on continuing research, Devon estimates a large number of contracts and data elements must be gathered and reviewed to ensure proper accounting of these contracts once this ASU is effective. Devon anticipates the adoption of this standard will significantly impact its consolidated financial statements, systems, processes and controls and is evaluating technology requirements and solutions needed to comply with the requirements of this ASU.

The FASB issued ASU No. 2017-07, Compensation – Retirement Benefits (Topic 715), Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. This ASU will require entities to present the service cost component of net periodic benefit cost in the same line item as other employee compensation costs and present the other components of net periodic benefit cost outside of operating income in the statement of earnings. Only the service cost component of net periodic benefit cost is eligible for capitalization. This ASU is effective for Devon beginning January 1, 2018, and presentation changes in the statement of earnings will be applied retrospectively, while service cost component capitalization will be applied prospectively. Upon adoption of this ASU, Devon will reclassify $7 million, $14 million and $16 million of non-service cost components of net periodic benefit costs for 2017, 2016 and 2015, respectively, as other nonoperating items. Such amounts are currently classified in Devon’s G&A. No other changes upon adopting this ASU are expected to be material.

Acquisitions And Divestitures
Acquisitions and Divestitures

2.

Acquisitions and Divestitures

Devon Acquisitions

In January 2016, Devon acquired approximately 80,000 net acres (unaudited) and assets in the STACK play for approximately $1.5 billion. Devon funded the acquisition with $849 million of cash, after adjustments, and $659 million of common equity shares. The purchase price allocation was approximately $1.3 billion to unproved properties and approximately $200 million to proved properties.

 

2017 Devon Asset Divestitures

In May 2017, Devon announced a program to divest approximately $1 billion of upstream assets. The non-core assets identified for monetization include select portions of the Barnett Shale focused primarily in and around Johnson County and other properties located principally within Devon’s U.S. resource base. Through September 30, 2017, Devon completed divestiture transactions totaling approximately $400 million, before purchase price adjustments. Estimated proved reserves associated with these assets were less than 1% of total U.S. proved reserves.

  

2016 Devon Asset Divestitures

In the second quarter of 2016, Devon divested non-core assets for approximately $200 million. Estimated proved reserves associated with these assets were less than 1% of total U.S. proved reserves.

In the third quarter of 2016, in several separate transactions with different purchasers, Devon divested non-core upstream assets located in east Texas, the Anadarko Basin and the Midland Basin for approximately $1.7 billion. Estimated proved reserves associated with these assets were approximately 146 MMBoe, or approximately 9% of total U.S. proved reserves.

Proceeds from the transactions were used primarily for debt repayment and to support capital investment in Devon’s core resource plays.

The divestiture transactions that closed in the third quarter of 2016 significantly altered the costs and reserves relationship of Devon’s U.S. cost center. Therefore, Devon recognized a $1.4 billion gain in the third quarter of 2016 associated with these divestitures. A summary of the gain computation follows.

 

 

Three Months Ended September 30, 2016

 

 

 

(Millions)

 

Proceeds received, net of purchase price adjustments and selling costs

 

$

1,653

 

Asset retirement obligation assumed by purchasers

 

 

250

 

Total consideration received

 

 

1,903

 

 

 

 

 

 

Allocated oil and gas property basis sold

 

 

355

 

Allocated goodwill

 

 

197

 

Total assets sold

 

 

552

 

 

 

 

 

 

Gain on asset sales

 

$

1,351

 

 

EnLink Acquisitions

In January 2016, EnLink acquired Anadarko Basin gathering and processing midstream assets, along with dedicated acreage service rights and service contracts, for approximately $1.4 billion. The purchase price allocation was $1.0 billion to intangible assets and approximately $400 million to property and equipment. EnLink funded the acquisition with approximately $215 million of General Partner common units and approximately $800 million of cash, primarily funded with the issuance of EnLink preferred units. The remaining $500 million of the purchase price was to be paid within one year with the option to defer $250 million of the final payment 24 months from the close date. The first installment payment of $250 million was paid in January 2017. The remaining $250 million payment is reported in other current liabilities in the accompanying consolidated balance sheets. The accretion of the discount is reported within net financing costs in the accompanying consolidated comprehensive statement of earnings.

In August 2016, EnLink formed a joint venture to operate and expand its midstream assets in the Delaware Basin. The joint venture is initially owned 50.1% by EnLink and 49.9% by the joint venture partner. EnLink contributed approximately $244 million of existing non-monetary assets to the joint venture and committed an additional $262 million in capital to fund potential future development projects and potential acquisitions. The joint venture partner committed an aggregate of approximately $400 million of capital, including initial cash contributions of approximately $138 million, and granted EnLink call rights beginning in 2021 to acquire increasing portions of the joint venture partner’s interest.

EnLink Asset Divestitures

During the first quarter of 2017, EnLink divested its ownership interest in Howard Energy Partners for approximately $190 million.

Derivative Financial Instruments
Derivative Financial Instruments

3.

Derivative Financial Instruments

Objectives and Strategies

Devon periodically enters into derivative financial instruments with respect to a portion of its oil, gas and NGL production to hedge future prices received. Additionally, Devon and EnLink periodically enter into derivative financial instruments with respect to a portion of their oil, gas and NGL marketing activities. These commodity derivative financial instruments include financial price swaps, basis swaps and costless price collars. Devon periodically enters into interest rate swaps to manage its exposure to interest rate volatility and foreign exchange forward contracts to manage its exposure to fluctuations in the U.S. and Canadian dollar exchange rates. As of September 30, 2017, Devon did not have any open foreign exchange contracts.

Devon does not intend to hold or issue derivative financial instruments for speculative trading purposes and has elected not to designate any of its derivative instruments for hedge accounting treatment.

Counterparty Credit Risk

By using derivative financial instruments, Devon is exposed to credit risk. Credit risk is the failure of the counterparty to perform under the terms of the derivative contract. To mitigate this risk, the hedging instruments are placed with a number of counterparties whom Devon believes are acceptable credit risks. It is Devon’s policy to enter into derivative contracts only with investment-grade rated counterparties deemed by management to be competent and competitive market makers. Additionally, Devon’s derivative contracts generally contain provisions that provide for collateral payments if Devon’s or its counterparty’s credit rating falls below certain credit rating levels.

  Commodity Derivatives

As of September 30, 2017, Devon had the following open oil derivative positions. The first table presents Devon’s oil derivatives that settle against the average of the prompt month NYMEX WTI futures price. The second table presents Devon’s oil derivatives that settle against the respective indices noted within the table.

 

 

Price Swaps

 

 

Price Collars

 

Period

 

Volume

(Bbls/d)

 

 

Weighted

Average

Price ($/Bbl)

 

 

Volume

(Bbls/d)

 

 

Weighted

Average Floor

Price ($/Bbl)

 

 

Weighted

Average

Ceiling Price

($/Bbl)

 

Q4 2017

 

 

82,167

 

 

$

53.87

 

 

 

79,200

 

 

$

45.51

 

 

$

57.41

 

Q1-Q4 2018

 

 

22,792

 

 

$

51.13

 

 

 

34,121

 

 

$

45.71

 

 

$

55.71

 

Q1-Q4 2019

 

 

1,356

 

 

$

49.79

 

 

 

2,096

 

 

$

44.10

 

 

$

54.10

 

 

 

 

Oil Basis Swaps

 

Period

 

Index

 

Volume (Bbls/d)

 

 

Weighted Average

Differential to WTI

($/Bbl)

 

Q4 2017

 

Midland Sweet

 

 

20,000

 

 

$

(0.41

)

Q4 2017

 

Western Canadian Select

 

 

87,304

 

 

$

(14.57

)

Q1-Q4 2018

 

Midland Sweet

 

 

23,000

 

 

$

(1.02

)

Q1-Q4 2018

 

Western Canadian Select

 

 

59,718

 

 

$

(14.85

)

Q1-Q4 2019

 

Midland Sweet

 

 

1,000

 

 

$

(0.80

)

 

As of September 30, 2017, Devon had the following open natural gas derivative positions. The first table presents Devon’s natural gas derivatives that settle against the Inside FERC first of the month Henry Hub index. The second table presents Devon’s natural gas derivatives that settle against the respective indices noted within the table.

 

 

 

Price Swaps

 

 

Price Collars

 

Period

 

Volume (MMBtu/d)

 

 

Weighted Average Price ($/MMBtu)

 

 

Volume (MMBtu/d)

 

 

Weighted Average Floor Price ($/MMBtu)

 

 

Weighted Average

Ceiling Price ($/MMBtu)

 

Q4 2017

 

 

331,196

 

 

$

3.21

 

 

 

455,000

 

 

$

3.03

 

 

$

3.41

 

Q1-Q4 2018

 

 

261,888

 

 

$

3.09

 

 

 

149,982

 

 

$

2.99

 

 

$

3.30

 

Q1-Q4 2019

 

 

6,164

 

 

$

3.08

 

 

 

8,630

 

 

$

2.92

 

 

$

3.22

 

 

 

 

Natural Gas Basis Swaps

 

Period

 

Index

 

Volume

(MMBtu/d)

 

 

Weighted Average

Differential to

Henry Hub

($/MMBtu)

 

Q4 2017

 

Panhandle Eastern Pipe Line

 

 

150,000

 

 

$

(0.34

)

Q4 2017

 

El Paso Natural Gas

 

 

80,000

 

 

$

(0.13

)

Q4 2017

 

Houston Ship Channel

 

 

35,000

 

 

$

0.06

 

Q4 2017

 

Transco Zone 4

 

 

205,000

 

 

$

0.03

 

Q1-Q4 2018

 

Panhandle Eastern Pipe Line

 

 

50,000

 

 

$

(0.29

)

 

As of September 30, 2017, Devon had the following open NGL derivative positions. Devon’s NGL positions settle against the average of the prompt month OPIS Mont Belvieu, Texas index.

 

 

 

 

 

 

Price Swaps

 

 

Price Collars

 

Period

 

Product

 

Volume (Bbls/d)

 

 

Weighted Average Price ($/Bbl)

 

 

Volume (Bbls/d)

 

 

Weighted Average Floor Price ($/Bbl)

 

 

Weighted Average Ceiling Price ($/Bbl)

 

Q4 2017

 

Propane

 

 

2,663

 

 

$

31.98

 

 

 

1,000

 

 

$

28.35

 

 

$

30.45

 

 

          As of September 30, 2017, EnLink had the following open derivative positions associated with gas processing and fractionation. EnLink’s NGL positions settle by purity product against the average of the prompt month OPIS Mont Belvieu, Texas index.

 

Period

 

Product

 

Volume (Total)

 

Weighted Average Price Paid

 

Weighted Average Price Received

Q4 2017-Q3 2018

 

Propane

 

 

537

 

MBbls

 

Index

 

$0.66/gal

Q4 2017-Q3 2018

 

Normal Butane

 

 

344

 

MBbls

 

Index

 

$0.77/gal

 

Interest Rate Derivatives

As of September 30, 2017, Devon had the following open interest rate derivative positions:

 

Notional

 

 

Rate Received

 

 

Rate Paid

 

 

Expiration

(Millions)

 

 

 

 

 

 

 

 

 

 

 

$

750

 

 

Three Month LIBOR

 

 

 

2.98%

 

 

December 2048 (1)

$

100

 

 

 

1.76%

 

 

Three Month LIBOR

 

 

January 2019

 

(1)

Mandatory settlement in December 2018.

 


Financial Statement Presentation

The following table presents the net gains and losses by derivative financial instrument type followed by the corresponding individual consolidated comprehensive statements of earnings caption.

 

 

 

Three Months Ended

September 30,

 

 

Nine Months Ended

September 30,

 

 

 

2017

 

 

2016

 

 

2017

 

 

2016

 

 

 

(Millions)

 

Commodity derivatives:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Oil, gas and NGL derivatives

 

$

(144

)

 

$

79

 

 

$

214

 

 

$

(30

)

Marketing and midstream revenues

 

 

(5

)

 

 

(1

)

 

 

3

 

 

 

(7

)

Interest rate derivatives:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other nonoperating items

 

 

(4

)

 

 

(20

)

 

 

(19

)

 

 

(163

)

Foreign currency derivatives:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other nonoperating items

 

 

 

 

 

 

 

 

 

 

 

(159

)

Net gains (losses) recognized

 

$

(153

)

 

$

58

 

 

$

198

 

 

$

(359

)

 

The following table presents the derivative fair values by derivative financial instrument type followed by the corresponding individual consolidated balance sheet caption.

 

 

 

September 30, 2017

 

 

December 31, 2016

 

 

 

(Millions)

 

Commodity derivative assets:

 

 

 

 

 

 

 

 

Other current assets

 

$

39

 

 

$

9

 

Other long-term assets

 

 

4

 

 

 

1

 

Interest rate derivative assets:

 

 

 

 

 

 

 

 

Other current assets

 

 

1

 

 

 

1

 

Total derivative assets

 

$

44

 

 

$

11

 

Commodity derivative liabilities:

 

 

 

 

 

 

 

 

Other current liabilities

 

$

53

 

 

$

187

 

Other long-term liabilities

 

 

7

 

 

 

16

 

Interest rate derivative liabilities:

 

 

 

 

 

 

 

 

Other current liabilities

 

 

1

 

 

 

 

Other long-term liabilities

 

 

61

 

 

 

41

 

Total derivative liabilities

 

$

122

 

 

$

244

 

 

Share-Based Compensation
Share-Based Compensation

4.

Share-Based Compensation

In the second quarter of 2017, Devon’s stockholders approved the 2017 Plan. The 2017 Plan replaces the 2015 Plan. From the effective date of the 2017 Plan, no further awards may be made under the 2015 Plan, and awards previously granted will continue to be governed by the terms of the respective award documents. Subject to the terms of the 2017 Plan, awards may be made for a total of 33.5 million shares of Devon common stock, plus the number of shares available for issuance under the 2015 Plan (including shares subject to outstanding awards under the 2015 Plan that are transferred to the 2017 Plan in accordance with its terms). The 2017 Plan authorizes the Compensation Committee, which consists of independent, non-management members of Devon’s Board of Directors, to grant nonqualified and incentive stock options, restricted stock awards or units, Canadian restricted stock units, performance units and stock appreciation rights to eligible employees. The 2017 Plan also authorizes the grant of nonqualified stock options, restricted stock awards or units and stock appreciation rights to non-employee directors. To calculate the number of shares that may be granted in awards under the 2017 Plan, options and stock appreciation rights represent one share and other awards represent 2.3 shares.

The following table presents the effects of share-based compensation included in Devon’s accompanying consolidated comprehensive statements of earnings. Gross G&A expense for the first nine months of 2017 and 2016 includes $28 million and $18 million, respectively, of unit-based compensation related to grants made under EnLink’s long-term incentive plans.

The vesting for certain share-based awards was accelerated in 2016 in conjunction with the reduction of workforce described in Note 6. For the nine months ended September 30, 2016, approximately $60 million of associated expense for these accelerated awards is included in restructuring and transaction costs in the accompanying consolidated comprehensive statements of earnings.

 

 

 

Nine Months Ended September 30,

 

 

 

2017

 

 

2016

 

 

 

(Millions)

 

Gross G&A for share-based compensation

 

$

141

 

 

$

117

 

Share-based compensation expense capitalized pursuant to

   the full cost method of accounting for oil and gas properties

 

$

31

 

 

$

30

 

Related income tax benefit

 

$

3

 

 

$

3

 

 

Under its approved long-term incentive plan, Devon granted share-based awards to certain employees in the first nine months of 2017. The following table presents a summary of Devon’s unvested restricted stock awards and units, performance-based restricted stock awards and performance share units granted under the plan.

 

 

 

Restricted Stock

 

 

Performance-Based

 

 

Performance

 

 

 

Awards and Units

 

 

Restricted Stock Awards

 

 

Share Units

 

 

 

Awards and

Units

 

 

Weighted

Average

Grant-Date

Fair Value

 

 

Awards

 

 

Weighted

Average

Grant-Date

Fair Value

 

 

Units

 

 

 

 

 

Weighted

Average

Grant-Date

Fair Value

 

 

 

(Thousands, except fair value data)

 

Unvested at 12/31/16

 

 

6,407

 

 

$

34.40

 

 

 

585

 

 

$

37.60

 

 

 

2,604

 

 

 

 

 

$

46.66

 

Granted

 

 

2,691

 

 

$

44.87

 

 

 

223

 

 

$

44.85

 

 

 

1,010

 

 

 

 

 

$

52.58

 

Vested

 

 

(2,321

)

 

$

39.51

 

 

 

(233

)

 

$

41.27

 

 

 

(832

)

 

 

 

 

$

78.19

 

Forfeited

 

 

(252

)

 

$

36.06

 

 

 

 

 

$

 

 

 

(24

)

 

 

 

 

$

40.70

 

Unvested at 9/30/17

 

 

6,525

 

 

$

36.83

 

 

 

575

 

 

$

38.92

 

 

 

2,758

 

 

(1

)

 

$

41.21

 

 

(1)

A maximum of 5.5 million common shares could be awarded based upon Devon’s final TSR ranking relative to Devon’s peer group established under applicable award agreements.

The following table presents the assumptions related to the performance share units granted in 2017, as indicated in the previous summary table.

 

 

 

2017

 

Grant-date fair value

 

$

51.05

 

 

 

$

53.12

 

Risk-free interest rate

 

1.50%

 

Volatility factor

 

45.8%

 

Contractual term (years)

 

2.89

 

 

The following table presents a summary of the unrecognized compensation cost and the related weighted average recognition period associated with unvested awards and units as of September 30, 2017.

 

 

 

 

 

 

 

Performance-Based

 

 

 

 

 

 

 

Restricted Stock

 

 

Restricted Stock

 

 

Performance

 

 

 

Awards and Units

 

 

Awards

 

 

Share Units

 

Unrecognized compensation cost (millions)

 

$

160

 

 

$

6

 

 

$

35

 

Weighted average period for recognition (years)

 

 

2.5

 

 

 

1.8

 

 

 

2.0

 

EnLink Share-Based Awards

In March 2017, the General Partner and EnLink issued restricted incentive units as bonus payments to officers and certain employees. The combined grant fair value was $10 million, and the total cost was recognized in the first quarter of 2017 due to the awards vesting immediately.

The following table presents a summary of the unrecognized compensation cost and the related weighted average recognition period associated with the General Partner’s and EnLink’s unvested restricted incentive units and performance units as of September 30, 2017.

 

 

 

General Partner

 

 

EnLink

 

 

 

Restricted

 

 

Performance

 

 

Restricted

 

 

Performance

 

 

 

Incentive Units

 

 

Units

 

 

Incentive Units

 

 

Units

 

Unrecognized compensation cost (millions)

 

$

14

 

 

$

6

 

 

$

15

 

 

$

6

 

Weighted average period for recognition (years)

 

 

1.8

 

 

 

2.0

 

 

 

1.7

 

 

 

1.9

 

 

Asset Impairments
Asset Impairments

5.

Asset Impairments

 

The following table presents the components of asset impairments.

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

2017

 

 

2016

 

 

2017

 

 

2016

 

 

 

(Millions)

 

U.S. oil and gas assets

 

$

 

 

$

317

 

 

$

 

 

$

2,810

 

Canada oil and gas assets

 

 

 

 

 

 

 

 

 

 

 

1,166

 

EnLink goodwill

 

 

 

 

 

 

 

 

 

 

 

873

 

Other assets

 

 

2

 

 

 

2

 

 

 

9

 

 

 

2

 

Total asset impairments

 

$

2

 

 

$

319

 

 

$

9

 

 

$

4,851

 

 

Oil and Gas Impairments

Under the full cost method of accounting, capitalized costs of oil and gas properties, net of accumulated DD&A and deferred income taxes, may not exceed the full cost “ceiling” at the end of each quarter. The ceiling is calculated separately for each country and is based on the present value of estimated future net cash flows from proved oil and gas reserves, discounted at 10% per annum, net of related tax effects. Estimated future net cash flows are calculated using end-of-period costs and an unweighted arithmetic average of commodity prices in effect on the first day of each of the previous 12 months.

The oil and gas impairments in 2016 resulted from declines in the U.S. and Canada full cost ceilings. The lower ceiling values resulted primarily from significant decreases in the 12-month average trailing prices for oil, bitumen, gas and NGLs, which significantly reduced proved reserves values and, to a lesser degree, proved reserves.

EnLink Goodwill Impairments

In the first quarter of 2016, EnLink recognized goodwill impairments. See Note 12 for additional details.

 

Restructuring And Transaction Costs
Restructuring And Transaction Costs

6.Restructuring and Transaction Costs

The following table summarizes restructuring and transaction costs presented in the accompanying consolidated comprehensive statement of earnings.

 

 

September 30, 2016

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

(Millions)

 

2016 reduction in workforce:

 

 

 

 

 

 

 

 

Employee related costs

 

$

(7

)

 

$

229

 

Lease obligations

 

 

 

 

 

17

 

Asset impairments

 

 

 

 

 

3

 

Transaction costs

 

 

2

 

 

 

17

 

Restructuring and transaction costs

 

$

(5

)

 

$

266

 

The following table summarizes Devon’s restructuring liabilities.

 

 

Other

 

 

Other

 

 

 

 

 

 

 

Current

 

 

Long-term

 

 

 

 

 

 

 

Liabilities

 

 

Liabilities

 

 

Total

 

 

 

(Millions)

 

Balance as of December 31, 2016

 

$

48

 

 

$

62

 

 

$

110

 

Changes due to 2016 workforce reductions

 

 

(25

)

 

 

(2

)

 

 

(27

)

Changes related to prior years' restructurings

 

 

(3

)

 

 

(24

)

 

 

(27

)

Balance as of September 30, 2017

 

$

20

 

 

$

36

 

 

$

56

 

Balance as of December 31, 2015

 

$

13

 

 

$

63

 

 

$

76

 

Changes due to 2016 workforce reductions

 

 

58

 

 

 

13

 

 

 

71

 

Changes related to prior years' restructurings

 

 

5

 

 

 

(8

)

 

 

(3

)

Balance as of September 30, 2016

 

$

76

 

 

$

68

 

 

$

144

 

Reduction in Workforce

In the first nine months of 2016, Devon recognized $229 million in employee-related costs associated with a reduction in workforce. Of these employee-related costs, approximately $60 million resulted from accelerated vesting of share-based grants, which are noncash charges. Additionally, approximately $30 million resulted from estimated settlements of defined retirement benefits.

As a result of the reduction of workforce, Devon ceased using certain office space that was subject to non-cancellable operating lease arrangements. Devon recognized restructuring costs that represent the present value of its future obligations under the leases and impairment charges for leasehold improvements and furniture associated with the office space it ceased using.

Transaction Costs

In the first nine months of 2016, Devon and EnLink recognized transaction costs primarily associated with the closing of the acquisitions discussed in Note 2.

Income Taxes
Income Taxes

7.

Income Taxes

The following table presents Devon’s total income tax expense (benefit) and a reconciliation of its effective income tax rate to the U.S. statutory income tax rate.

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

2017

 

 

2016

 

 

2017

 

 

2016

 

 

 

(Millions)

 

Current income tax expense

 

$

39

 

 

$

85

 

 

$

71

 

 

$

72

 

Deferred income tax expense (benefit)

 

 

(14

)

 

 

86

 

 

 

(20

)

 

 

(300

)

Total income tax expense (benefit)

 

$

25

 

 

$

171

 

 

$

51

 

 

$

(228

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. statutory income tax rate

 

 

35

%

 

 

35

%

 

 

35

%

 

 

35

%

Deferred tax asset valuation allowance

 

 

(9

%)

 

 

(35

%)

 

 

(25

%)

 

 

(20

%)

Non-deductible goodwill impairments

 

 

0

%

 

 

6

%

 

 

0

%

 

 

(9

%)

Change in unrecognized tax benefits

 

 

3

%

 

 

7

%

 

 

1

%

 

 

(2

%)

Taxation on Canadian operations

 

 

(1

%)

 

 

0

%

 

 

0

%

 

 

(3

%)

State income taxes

 

 

0

%

 

 

2

%

 

 

0

%

 

 

1

%

Other

 

 

(19

%)

 

 

0

%

 

 

(7

%)

 

 

3

%

Effective income tax rate

 

 

9

%

 

 

15

%

 

 

4

%

 

 

5

%

 

Devon estimates its annual effective income tax rate in recording its quarterly provision for income taxes in the various jurisdictions in which it operates. Statutory tax rate changes and other significant or unusual items are recognized as discrete items in the quarter in which they occur.

Throughout 2016 and through the first nine months of 2017, Devon continued to maintain a 100% valuation allowance against its U.S. deferred tax assets resulting from prior year cumulative financial losses largely due to full cost impairments. Furthermore, a partial allowance continues to be held against certain Canadian segment deferred tax assets.

Devon provided an additional $796 million to the U.S. segment valuation allowance in the first nine months of 2016 based on the financial loss recorded during the period. Also, during the third quarter of 2016, Devon’s Canadian segment recorded a $71 million partial valuation allowance. Devon reduced its U.S. segment valuation allowance by $348 million in the first nine months of 2017 based on the financial income recorded during the period.

Also in the table above, the “other” effect is primarily composed of permanent differences for which dollar amounts do not increase or decrease in relation to the change in pre-tax earnings. Generally, such items have an insignificant impact on our effective income tax rate. However, these items have a more noticeable impact to our rate in the third quarter of 2017 due to lower relative earnings during the period. During the third quarter of 2017, “other” is primarily related to the taxation of foreign earnings and other financing items.

In the first quarter of 2016, EnLink recorded goodwill impairments totaling $873 million. These impairments are not deductible for purposes of calculating income tax and, therefore, have an impact on the effective tax rate.

Devon is under audit in the U.S. and various foreign jurisdictions as part of its normal course of business. The timing of resolution of income tax examinations is uncertain as are the amounts and timing of tax payments that are part of any audit settlement process. Devon believes that within the next 12 months it is reasonably possible that certain tax examinations will be resolved by settlement with the taxing authorities.

 

Net Earnings (Loss) Per Share Attributable to Devon
Net Earnings (Loss) Per Share Attributable to Devon

8.

Net Earnings (Loss) Per Share Attributable to Devon

The following table reconciles net earnings (loss) attributable to Devon and weighted-average common shares outstanding used in the calculations of basic and diluted net earnings (loss) per share.

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

2017

 

 

2016

 

 

2017

 

 

2016

 

 

 

(Millions, except per share amounts)

 

Net earnings (loss):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net earnings (loss) attributable to Devon

 

$

228

 

 

$

993

 

 

$

1,218

 

 

$

(3,633

)

Attributable to participating securities

 

 

(2

)

 

 

(11

)

 

 

(13

)

 

 

(1

)

Basic and diluted earnings (loss)

 

$

226

 

 

$

982

 

 

$

1,205

 

 

$

(3,634

)

Common shares:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common shares outstanding - total

 

 

526

 

 

 

524

 

 

 

525

 

 

 

509

 

Attributable to participating securities

 

 

(6

)

 

 

(6

)

 

 

(6

)

 

 

(6

)

Common shares outstanding - basic

 

 

520

 

 

 

518

 

 

 

519

 

 

 

503

 

Dilutive effect of potential common shares issuable

 

 

3

 

 

 

3

 

 

 

3

 

 

 

 

Common shares outstanding - diluted

 

 

523

 

 

 

521

 

 

 

522

 

 

 

503

 

Net earnings (loss) per share attributable to Devon:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.43

 

 

$

1.90

 

 

$

2.32

 

 

$

(7.22

)

Diluted

 

$

0.43

 

 

$

1.89

 

 

$

2.31

 

 

$

(7.22

)

Antidilutive options (1)

 

 

2

 

 

 

3

 

 

 

2

 

 

 

3

 

 

(1)

Amounts represent options to purchase shares of Devon’s common stock that are excluded from the diluted net earnings (loss) per share calculations because the options are antidilutive.

Other Comprehensive Earnings
Other Comprehensive Earnings

9.

Other Comprehensive Earnings

Components of other comprehensive earnings consist of the following:

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

2017

 

 

2016

 

 

2017

 

 

2016

 

 

 

(Millions)

 

Foreign currency translation:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Beginning accumulated foreign currency translation

 

$

456

 

 

$

450

 

 

$

456

 

 

$

424

 

Change in cumulative translation adjustment

 

 

17

 

 

 

(1

)

 

 

31

 

 

 

52

 

Income tax benefit (expense)

 

 

(16

)

 

 

3

 

 

 

(30

)

 

 

(24

)

Ending accumulated foreign currency translation

 

 

457

 

 

 

452

 

 

 

457

 

 

 

452

 

Pension and postretirement benefit plans:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Beginning accumulated pension and postretirement benefits

 

 

(163

)

 

 

(185

)

 

 

(172

)

 

 

(194

)

Recognition of net actuarial loss and prior

   service cost in earnings (1)

 

 

5

 

 

 

7

 

 

 

14

 

 

 

20

 

Income tax benefit

 

 

 

 

 

4

 

 

 

 

 

 

 

Ending accumulated pension and postretirement benefits

 

 

(158

)

 

 

(174

)

 

 

(158

)

 

 

(174

)

Other

 

 

(2

)

 

 

 

 

 

(2

)

 

 

 

Accumulated other comprehensive earnings, net of tax

 

$

297

 

 

$

278

 

 

$

297

 

 

$

278

 

 

(1)

These accumulated other comprehensive earnings components are included in the computation of net periodic benefit cost, which is a component of G&A on the accompanying consolidated comprehensive statements of earnings. See Note 16 for additional details.

Supplemental Information To Statements Of Cash Flows
Supplemental Information To Statements Of Cash Flows

10.

Supplemental Information to Statements of Cash Flows

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

2017

 

 

2016

 

 

2017

 

 

2016

 

 

 

(Millions)

 

Net change in working capital accounts,

    net of assets and liabilities assumed:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accounts receivable

 

$

(215

)

 

$

81

 

 

$

(85

)

 

$

87

 

Income taxes receivable

 

 

 

 

 

6

 

 

 

8

 

 

 

107

 

Other current assets

 

 

12

 

 

 

98

 

 

 

(43

)

 

 

242

 

Accounts payable

 

 

48

 

 

 

(34

)

 

 

98

 

 

 

(185

)

Revenues and royalties payable

 

 

63

 

 

 

40

 

 

 

92

 

 

 

34

 

Other current liabilities

 

 

99

 

 

 

(54

)

 

 

24

 

 

 

(77

)

Net change in working capital

 

$

7

 

 

$

137

 

 

$

94

 

 

$

208

 

Interest paid (net of capitalized interest)

 

$

49

 

 

$

113

 

 

$

285

 

 

$

402

 

Income taxes paid (received)

 

$

 

 

$

(7

)

 

$

(1)

 

 

$

(130

)

 

Devon’s acquisition of certain STACK assets during the first three months of 2016 included the noncash issuance of Devon common stock. See Note 2 for additional details.

EnLink’s acquisition of Anadarko Basin gathering and processing midstream assets during the first quarter of 2016 included the noncash issuance of General Partner common units. Additionally, EnLink’s formation of a joint venture during the third quarter of 2016 included non-monetary asset contributions. See Note 2 for additional details.

 

Accounts Receivable
Accounts Receivable

11.

Accounts Receivable

Components of accounts receivable include the following:

 

 

 

September 30, 2017

 

 

December 31, 2016

 

 

 

(Millions)

 

Oil, gas and NGL sales

 

$

528

 

 

$

487

 

Joint interest billings

 

 

111

 

 

 

110

 

Marketing and midstream revenues

 

 

792

 

 

 

708

 

Other

 

 

44

 

 

 

69

 

Gross accounts receivable

 

 

1,475

 

 

 

1,374

 

Allowance for doubtful accounts

 

 

(13

)

 

 

(18

)

Net accounts receivable

 

$

1,462

 

 

$

1,356

 

 

Goodwill And Other Intangible Assets
Goodwill And Other Intangible Assets

12.

Goodwill and Other Intangible Assets

Goodwill

Devon performs an annual impairment test of goodwill at October 31, or more frequently if events or changes in circumstances indicate that the carrying value of a reporting unit may not be recoverable. Sustained weakness in the overall energy sector driven by low commodity prices, together with a decline in EnLink’s unit price, caused a noncash goodwill impairment of $873 million in the first quarter of 2016. This consisted of a full impairment charge of $93 million related to EnLink’s Crude and Condensate reporting unit and partial impairments to EnLink’s Texas and General Partner reporting units of $473 million and $307 million, respectively.

Asset Divestitures

During the third quarter of 2016, Devon derecognized $197 million of goodwill in conjunction with the upstream oil and gas asset divestitures discussed in Note 2.

Other Intangible Assets

The following table presents other intangible assets reported in other long-term assets in the accompanying consolidated balance sheets.

 

 

 

September 30, 2017

 

 

December 31, 2016

 

 

 

(Millions)

 

Customer relationships

 

$

1,796

 

 

$

1,796

 

Accumulated amortization

 

 

(202

)

 

 

(172

)

Net intangibles

 

$

1,594

 

 

$

1,624

 

 

The weighted-average amortization period for other intangible assets is 15 years. Amortization expense for intangibles was $37 million and $29 million for the three months ended September 30, 2017 and 2016, respectively, and $96 million and $87 million for the nine months ended September 30, 2017 and 2016, respectively. The remaining amortization expense is estimated to be $123 million for each of the next five years.

Other Current Liabilities
Other Current Liabilities

13.

Other Current Liabilities

Components of other current liabilities include the following:

 

 

September 30, 2017

 

 

December 31, 2016

 

 

(Millions)

 

Installment payment - see Note 2

$

243

 

 

$

249

 

Accrued interest payable

 

204

 

 

 

130

 

Income taxes payable

 

197

 

 

 

32

 

Derivative liabilities

 

54

 

 

 

187

 

Restructuring liabilities

 

20

 

 

 

48

 

Other

 

285

 

 

 

420

 

Other current liabilities

$

1,003

 

 

$

1,066

 

 

Asset Retirement Obligations
Asset Retirement Obligations

15.     Asset Retirement Obligations

The following table presents the changes in Devon’s asset retirement obligations.

 

 

 

Nine Months Ended September 30,

 

 

 

2017

 

 

2016

 

 

 

(Millions)

 

Asset retirement obligations as of beginning of period

 

$

1,272

 

 

$

1,414

 

Liabilities incurred and assumed through acquisitions

 

 

30

 

 

 

18

 

Liabilities settled and divested

 

 

(53

)

 

 

(310

)

Revision of estimated obligation

 

 

(184

)

 

 

70

 

Accretion expense on discounted obligation

 

 

47

 

 

 

58

 

Foreign currency translation adjustment

 

 

29

 

 

 

26

 

Asset retirement obligations as of end of period

 

 

1,141

 

 

 

1,276

 

Less current portion

 

 

41

 

 

 

46

 

Asset retirement obligations, long-term

 

$

1,100

 

 

$

1,230

 

 

          During the first quarter of 2017, Devon reduced its estimated asset retirement obligations by $184 million primarily due to changes in the assumed inflation rate and retirement dates for its oil and gas assets.

 

During the first nine months of 2016, Devon reduced its asset retirement obligation by $285 million for those obligations that were assumed by purchasers of certain upstream U.S. assets. See Note 2 for additional details.

Retirement Plans
Retirement Plans

16.

Retirement Plans

The following table presents the components of net periodic benefit cost for Devon’s pension and postretirement benefit plans.

 

 

 

Pension Benefits

 

 

Postretirement Benefits

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

September 30,

 

 

September 30,

 

 

 

2017

 

 

2016

 

 

2017

 

 

2016

 

 

2017

 

 

2016

 

 

2017

 

 

2016

 

 

 

(Millions)

 

Service cost

 

$

4

 

 

$

3

 

 

$

12

 

 

$

12

 

 

$

 

 

$

 

 

$

 

 

$

 

Interest cost

 

 

11

 

 

 

9

 

 

 

32

 

 

 

32

 

 

 

 

 

 

 

 

 

 

 

 

 

Expected return on plan assets

 

 

(14

)

 

 

(14

)

 

 

(41

)

 

 

(40

)

 

 

 

 

 

 

 

 

 

 

 

 

Amortization of prior service cost (1)

 

 

 

 

 

1

 

 

 

1

 

 

 

2

 

 

 

 

 

 

 

 

 

(1

)

 

 

(1

)

Net actuarial loss (1)

 

 

5

 

 

 

6

 

 

 

14

 

 

 

19

 

 

 

 

 

 

 

 

 

 

 

 

 

Net periodic benefit cost (2)

 

$

6

 

 

$

5

 

 

$

18

 

 

$

25

 

 

$

 

 

$

 

 

$

(1

)

 

$

(1

)

 

(1)

These net periodic benefit costs were reclassified out of other comprehensive earnings in the current period.

(2)    Net periodic benefit cost is a component of G&A in the accompanying consolidated comprehensive statements of earnings.

Stockholders' Equity
Stockholders' Equity

17.

Stockholders’ Equity

Common Stock Issued

In January 2016, Devon issued approximately 23 million shares of common stock in conjunction with the STACK asset acquisition discussed in Note 2.

In February 2016, Devon issued 79 million shares of common stock to the public, inclusive of 10 million shares sold as part of the underwriters’ option. Net proceeds from the offering were $1.5 billion.

Dividends

The table below summarizes the dividends Devon paid on its common stock.

 

Amounts

 

 

Rate

 

 

(Millions)

 

 

(Per Share)

 

Quarter Ended 2017:

 

 

 

 

 

 

 

First quarter 2017

$

32

 

 

$

0.06

 

Second quarter 2017

 

33

 

 

$

0.06

 

Third quarter 2017

 

30

 

 

$

0.06

 

Total year-to-date

$

95

 

 

 

 

 

Quarter Ended 2016:

 

 

 

 

 

 

 

First quarter 2016

$

125

 

 

$

0.24

 

Second quarter 2016

 

33

 

 

$

0.06

 

Third quarter 2016

 

32

 

 

$

0.06

 

Total year-to-date

$

190

 

 

 

 

 

In response to the depressed commodity price environment, Devon reduced its quarterly dividend to $0.06 per share in the second quarter of 2016.

 

Noncontrolling Interests
Noncontrolling interests

18.

Noncontrolling Interests

Subsidiary Equity Transactions

EnLink has the ability to sell common units through its “at the market” equity offering programs. In the third quarter of 2017, EnLink entered into additional equity distribution agreements to sell up to $600 million in common units through its programs. Future common units that EnLink issues will be issued under the new equity distribution agreement. During the first nine months of 2017, EnLink issued and sold 5 million common units through its programs and generated $92 million in net proceeds.

In September 2017, EnLink issued 400,000 preferred units through an underwritten public offering for net proceeds of approximately $394 million.

During the first nine months of 2016, EnLink issued and sold 7 million common units for net proceeds of $110 million. In conjunction with its acquisition of Anadarko Basin gathering and processing midstream assets during the first quarter of 2016, EnLink issued preferred units as discussed in Note 2.

As of September 30, 2017, Devon’s ownership interest in EnLink was 23%, excluding the interest held by the General Partner. Devon’s controlling ownership interest in the General Partner as of September 30, 2017 was 64%. The net gains and losses and related income taxes resulting from these transactions have been recorded as an adjustment to equity, with the change in ownership reflected as an adjustment to noncontrolling interests.

Distributions to Noncontrolling Interests

EnLink and the General Partner distributed $247 million and $224 million to non-Devon unitholders during the first nine months of 2017 and 2016, respectively.

Commitments And Contingencies
Commitments And Contingencies

19.

Commitments and Contingencies

Devon is party to various legal actions arising in the normal course of business. Matters that are probable of unfavorable outcome to Devon and which can be reasonably estimated are accrued. Such accruals are based on information known about the matters, Devon’s estimates of the outcomes of such matters and its experience in contesting, litigating and settling similar matters. None of the actions are believed by management to involve future amounts that would be material to Devon’s financial position or results of operations after consideration of recorded accruals. Actual amounts could differ materially from management’s estimates.

Royalty Matters

Numerous oil and natural gas producers and related parties, including Devon, have been named in various lawsuits alleging royalty underpayments. The suits allege that the producers and related parties used below-market prices, made improper deductions, used improper measurement techniques and entered into gas purchase and processing arrangements with affiliates that resulted in underpayment of royalties in connection with oil, natural gas and NGLs produced and sold. Devon is also involved in governmental agency proceedings and is subject to related contracts and regulatory controls in the ordinary course of business, some that may lead to additional royalty claims. Devon does not currently believe that it is subject to material exposure with respect to such royalty matters.

Environmental Matters

Devon is subject to certain environmental, health and safety laws and regulations, including with respect to environmental remediation activities associated with past operations, such as the Comprehensive Environmental Response, Compensation, and Liability Act and similar state statutes. In response to liabilities associated with these activities, loss accruals primarily consist of estimated uninsured remediation costs. Devon’s monetary exposure for environmental matters is not expected to be material.

Other Matters

Devon is involved in other various legal proceedings incidental to its business. However, to Devon’s knowledge, there were no other material pending legal proceedings to which Devon is a party or to which any of its property is subject.

Fair Value Measurements
Fair Value Measurements

20.

Fair Value Measurements

The following table provides carrying value and fair value measurement information for certain of Devon’s financial assets and liabilities. None of the items below are measured using Level 3 inputs. The carrying values of cash, accounts receivable, other current receivables, accounts payable, other current payables and accrued expenses included in the accompanying consolidated balance sheets approximated fair value at September 30, 2017 and December 31, 2016. Therefore, such financial assets and liabilities are not presented in the following table. Additionally, the fair values of oil and gas assets, goodwill and other intangible assets and related impairments are measured as of the impairment date using Level 3 inputs. More information on these items is provided in Note 5 and Note 12, respectively.

 

 

 

 

 

 

 

 

 

 

 

Fair Value

 

 

 

 

 

 

 

 

 

 

 

Measurements Using:

 

 

 

Carrying

 

 

Total Fair

 

 

Level 1

 

 

Level 2

 

 

 

Amount

 

 

Value

 

 

Inputs

 

 

Inputs

 

 

 

(Millions)

 

September 30, 2017 assets (liabilities):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash equivalents

 

$

1,510

 

 

$

1,510

 

 

$

1,431

 

 

$

79

 

Commodity derivatives

 

$

43

 

 

$

43

 

 

$

 

 

$

43

 

Commodity derivatives

 

$

(60

)

 

$

(60

)

 

$

 

 

$

(60

)

Interest rate derivatives

 

$

1

 

 

$

1

 

 

$

 

 

$

1

 

Interest rate derivatives

 

$

(62

)

 

$

(62

)

 

$

 

 

$

(62

)

Debt

 

$

(10,403

)

 

$

(11,480

)

 

$

 

 

$

(11,480

)

Installment payment

 

$

(243

)

 

$

(244

)

 

$

 

 

$

(244

)

Capital lease obligations

 

$

(4

)

 

$

(4

)

 

$

 

 

$

(4

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2016 assets (liabilities):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash equivalents

 

$

1,542

 

 

$

1,542

 

 

$

1,298

 

 

$

244

 

Commodity derivatives

 

$

10

 

 

$

10

 

 

$

 

 

$

10

 

Commodity derivatives

 

$

(203

)

 

$

(203

)

 

$

 

 

$

(203

)

Interest rate derivatives

 

$

1

 

 

$

1

 

 

$

 

 

$

1

 

Interest rate derivatives

 

$

(41

)

 

$

(41

)

 

$

 

 

$

(41

)

Debt

 

$

(10,154

)

 

$

(10,760

)

 

$

 

 

$

(10,760

)

Installment payment

 

$

(473

)

 

$

(477

)

 

$

 

 

$

(477

)

Capital lease obligations

 

$

(7

)

 

$

(6

)

 

$

 

 

$

(6

)

The following methods and assumptions were used to estimate the fair values in the table above.

Level 1 Fair Value Measurements

Cash equivalents – Amounts consist primarily of money market investments and U.S. and Canadian treasury securities. The fair value approximates the carrying value.

Level 2 Fair Value Measurements

Cash equivalents – Amounts consist primarily of commercial paper and Canadian agency and provincial securities investments. The fair value approximates the carrying value.

Commodity and interest rate derivatives – The fair values of commodity and interest rate derivatives are estimated using internal discounted cash flow calculations based upon forward curves and data obtained from independent third parties for contracts with similar terms or data obtained from counterparties to the agreements.

Debt – Devon’s debt instruments do not actively trade in an established market. The fair values of its debt are estimated based on rates available for debt with similar terms and maturity. The fair value of the credit facility balance is the carrying value.

Installment payment – The fair value of the EnLink installment payment was based on Level 2 inputs from third-party market quotations.

Capital lease obligations – The fair value was calculated using inputs from third-party banks.

Segment Information
Segment Information

21.

Segment Information

Devon manages its operations through distinct operating segments, which are defined primarily by geographic areas. For financial reporting purposes, Devon aggregates its U.S. operating segments into one reporting segment due to the similar nature of the businesses. However, Devon’s Canadian E&P operating segment is reported as a separate reporting segment primarily due to the significant differences between the U.S. and Canadian regulatory environments. Devon’s U.S. and Canadian segments are both primarily engaged in oil and gas E&P activities.

Devon considers EnLink, combined with the General Partner, to be an operating segment that is distinct from the U.S. and Canadian operating segments. EnLink’s operations consist of midstream assets and operations located across the U.S. Additionally, EnLink has a management team that is primarily responsible for capital and resource allocation decisions. Therefore, EnLink is presented as a separate reporting segment.

 

 

 

U.S.

 

 

Canada

 

 

EnLink

 

 

Eliminations

 

 

Total

 

 

 

(Millions)

 

Three Months Ended September 30, 2017:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues from external customers

 

$

1,575

 

 

$

358

 

 

$

1,223

 

 

$

 

 

$

3,156

 

Asset dispositions and other

 

$

1

 

 

$

 

 

$

(1

)

 

$

 

 

$

 

Intersegment revenues

 

$

 

 

$

 

 

$

174

 

 

$

(174

)

 

$

 

Depreciation, depletion and amortization

 

$

195

 

 

$

63

 

 

$

142

 

 

$

 

 

$

400

 

Interest expense

 

$

82

 

 

$

17

 

 

$

49

 

 

$

(15

)

 

$

133

 

Asset impairments

 

$

 

 

$

 

 

$

2

 

 

$

 

 

$

2

 

Earnings before income taxes

 

$

167

 

 

$

85

 

 

$

20

 

 

$

 

 

$

272

 

Income tax expense

 

$

(5

)

 

$

28

 

 

$

2

 

 

$

 

 

$

25

 

Net earnings

 

$

172

 

 

$

57

 

 

$

18

 

 

$

 

 

$

247

 

Net earnings attributable to noncontrolling interests

 

$

 

 

$

 

 

$

19

 

 

$

 

 

$

19

 

Net earnings (loss) attributable to Devon

 

$

172

 

 

$

57

 

 

$

(1

)

 

$

 

 

$

228

 

Capital expenditures, including acquisitions

 

$

560

 

 

$

103

 

 

$

170

 

 

$

 

 

$

833

 

Three Months Ended September 30, 2016:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues from external customers

 

$

1,653

 

 

$

305

 

 

$

924

 

 

$

 

 

$

2,882

 

Asset dispositions and other

 

$

1,351

 

 

$

 

 

$

 

 

$

 

 

$

1,351

 

Intersegment revenues

 

$

 

 

$

 

 

$

180

 

 

$

(180

)

 

$

 

Depreciation, depletion and amortization

 

$

196

 

 

$

72

 

 

$

126

 

 

$

 

 

$

394

 

Interest expense

 

$

185

 

 

$

34

 

 

$

49

 

 

$

(23

)

 

$

245

 

Asset impairments

 

$

317

 

 

$

2

 

 

$

 

 

$

 

 

$

319

 

Restructuring and transaction costs

 

$

(10

)

 

$

5

 

 

$

 

 

$

 

 

$

(5

)

Earnings before income taxes

 

$

1,122

 

 

$

37

 

 

$

19

 

 

$

 

 

$

1,178

 

Income tax expense

 

$

5

 

 

$

159

 

 

$

7

 

 

$

 

 

$

171

 

Net earnings (loss)

 

$

1,117

 

 

$

(122

)

 

$

12

 

 

$

 

 

$

1,007

 

Net earnings attributable to noncontrolling interests

 

$

 

 

$

 

 

$

14

 

 

$

 

 

$

14

 

Net earnings (loss) attributable to Devon

 

$

1,117

 

 

$

(122

)

 

$

(2

)

 

$

 

 

$

993

 

Capital expenditures, including acquisitions

 

$

277

 

 

$

48

 

 

$

132

 

 

$

 

 

$

457

 

Nine Months Ended September 30, 2017:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues from external customers

 

$

5,547

 

 

$

951

 

 

$

3,468

 

 

$

 

 

$

9,966

 

Asset dispositions and other

 

$

11

 

 

$

 

 

$

(1

)

 

$

 

 

$

10

 

Intersegment revenues

 

$

 

 

$

 

 

$

515

 

 

$

(515

)

 

$

 

Depreciation, depletion and amortization

 

$

556

 

 

$

199

 

 

$

407

 

 

$

 

 

$

1,162

 

Interest expense

 

$

243

 

 

$

48

 

 

$

133

 

 

$

(42

)

 

$

382

 

Asset impairments

 

$

 

 

$

 

 

$

9

 

 

$

 

 

$

9

 

Earnings before income taxes

 

$

1,133

 

 

$

126

 

 

$

69

 

 

$

 

 

$

1,328

 

Income tax expense

 

$

 

 

$

42

 

 

$

9

 

 

$

 

 

$

51

 

Net earnings

 

$

1,133

 

 

$

84

 

 

$

60

 

 

$

 

 

$

1,277

 

Net earnings attributable to noncontrolling interests

 

$

 

 

$

 

 

$

59

 

 

$

 

 

$

59

 

Net earnings attributable to Devon

 

$

1,133

 

 

$

84

 

 

$

1

 

 

$

 

 

$

1,218

 

Property and equipment, net

 

$

7,726

 

 

$

2,787

 

 

$

6,569

 

 

$

 

 

$

17,082

 

Total assets

 

$

13,302

 

 

$

3,761

 

 

$

10,548

 

 

$

(52

)

 

$

27,559

 

Capital expenditures, including acquisitions

 

$

1,460

 

 

$

275

 

 

$

636

 

 

$

 

 

$

2,371

 

Nine Months Ended September 30, 2016:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues from external customers

 

$

4,320

 

 

$

688

 

 

$

2,488

 

 

$

 

 

$

7,496

 

Asset dispositions and other

 

$

1,351

 

 

$

 

 

$

 

 

$

 

 

$

1,351

 

Intersegment revenues

 

$

 

 

$

 

 

$

539

 

 

$

(539

)

 

$

 

Depreciation, depletion and amortization

 

$

763

 

 

$

284

 

 

$

373

 

 

$

 

 

$

1,420

 

Interest expense

 

$

400

 

 

$

101

 

 

$

140

 

 

$

(66

)

 

$

575

 

Asset impairments

 

$

2,810

 

 

$

1,168

 

 

$

873

 

 

$

 

 

$

4,851

 

Restructuring and transaction costs

 

$

245

 

 

$

15

 

 

$

6

 

 

$

 

 

$

266

 

Loss before income taxes

 

$

(2,040

)

 

$

(1,359

)

 

$

(853

)

 

$

 

 

$

(4,252

)

Income tax expense (benefit)

 

$

(6

)

 

$

(223

)

 

$

1

 

 

$

 

 

$

(228

)

Net loss

 

$

(2,034

)

 

$

(1,136

)

 

$

(854

)

 

$

 

 

$

(4,024

)

Net earnings (loss) attributable to noncontrolling interests

 

$

1

 

 

$

 

 

$

(392

)

 

$

 

 

$

(391

)

Net loss attributable to Devon

 

$

(2,035

)

 

$

(1,136

)

 

$

(462

)

 

$

 

 

$

(3,633

)

Property and equipment, net

 

$

7,196

 

 

$

2,778

 

 

$

6,195

 

 

$

 

 

$

16,169

 

Total assets

 

$

12,317

 

 

$

4,355

 

 

$

10,197

 

 

$

(56

)

 

$

26,813

 

Capital expenditures, including acquisitions

 

$

2,454

 

 

$

158

 

 

$

816

 

 

$

 

 

$

3,428

 

 

Summary Of Significant Accounting Policies (Policies)

Recently Adopted Accounting Standards

In January 2017, Devon adopted ASU 2016-09, Compensation – Stock Compensation (Topic 718), Improvements to Employee Share-Based Payment Accounting. Its objective is to simplify several aspects of the accounting for share-based payments, including income taxes when awards vest or are settled, statutory withholding and forfeitures. As the result of adoption, Devon made certain income tax presentation changes, most notably prospectively presenting excess tax benefits and deficiencies in the consolidated comprehensive statements of earnings and as operating cash flows in the consolidated statements of cash flows. Devon also retrospectively applied the new cash flow statement guidance dictating the presentation of shares exchanged for tax-withholding purposes as a financing activity. The adoption of the new guidance did not materially impact the consolidated financial statements for the nine months ended September 30, 2017 or previously reported financial information but could have a more material future impact.

In January 2017, the FASB issued ASU 2017-04, Intangibles – Goodwill And Other (Topic 350), Simplifying the Test for Goodwill Impairment ("ASU 2017-04"). ASU 2017-04 simplifies the accounting for goodwill impairments by eliminating the requirement to compare the implied fair value of goodwill with its carrying amount as part of step two of the goodwill impairment test. Under ASU 2017-04, an entity should perform its goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit's fair value. However, the impairment loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. ASU 2017-04 is effective for annual reporting periods beginning after December 15, 2019, including any interim impairment tests within those annual periods, with early application for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. In January 2017, Devon elected to early adopt ASU 2017-04, and the adoption had no impact on the consolidated financial statements. Devon will perform future goodwill impairment tests according to ASU 2017-04.

Issued Accounting Standards Not Yet Adopted

The FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606). This ASU will supersede the revenue recognition requirements in Topic 605, Revenue Recognition and industry-specific guidance in Subtopic 932-605, Extractive Activities – Oil and Gas – Revenue Recognition. This ASU provides guidance concerning the recognition and measurement of revenue from contracts with customers. Its objective is to increase the usefulness of information in the financial statements regarding the nature, timing and uncertainty of revenues. The effective date for ASU 2014-09 was delayed through the issuance of ASU 2015-14, Revenue from Contracts with Customers – Deferral of the Effective Date, to annual and interim periods beginning in 2018, with early adoption permitted in 2017. Devon has not early adopted this ASU. The ASU is required to be adopted using either the retrospective transition method, which requires restating previously reported results or the cumulative effect (modified retrospective) transition method, which utilizes a cumulative-effect adjustment to retained earnings in the period of adoption to account for prior period effects rather than restating previously reported results. Devon intends to use the cumulative effect transition method and does not anticipate this ASU will have a material impact on its balance sheet or related consolidated statements of earnings, equity or cash flows. However, Devon continues to evaluate the “gross versus net” presentation of certain revenues and associated expenses in its consolidated statements of earnings. Any presentation changes would have no impact on operating income, earnings or cash flows. Devon does not expect significant changes to its annual disclosures; however, Devon’s quarterly disclosures will expand upon adoption of this ASU. Devon has implemented a process to gather and provide the quarterly disclosures required by the ASU.

The FASB issued ASU 2016-02, Leases (Topic 842). This ASU will supersede the lease requirements in Topic 840, Leases. Its objective is to increase transparency and comparability among organizations. This ASU provides guidance requiring lessees to recognize most leases on their balance sheet. Lessor accounting does not significantly change, except for some changes made to align with new revenue recognition requirements. This ASU is effective for Devon beginning January 1, 2019 and will be applied using a modified retrospective transition method, which requires applying the new guidance to leases that exist or are entered into after the beginning of the earliest period in the financial statements. Early adoption is permitted, but Devon does not plan to early adopt. Devon is in the process of evaluating contracts and gathering the necessary terms and data elements for purposes of determining the impact this ASU will have on its consolidated financial statements and related disclosures. Recently, the FASB issued Proposed Accounting Standards Update (ASU) No. 2017-290, Leases (Topic 842), Land Easement Practical Expedient for Transition to Topic 842. This proposed ASU would permit an entity not to apply Topic 842 to land easements and rights-of-way that exist or expired before the effective date of Topic 842 and that were not previously assessed under Topic 840. An entity would continue to apply its current accounting policy for accounting for land easements that existed before the effective date of Topic 842. Once an entity adopts Topic 842, it would apply that Topic prospectively to all new (or modified) land easements and rights-of-way to determine whether the arrangement should be accounted for as a lease. For Devon, these contracts represent a relatively small percentage of the aggregate value of contracts being evaluated but represent a significant number of contracts.

Based on continuing research, Devon estimates a large number of contracts and data elements must be gathered and reviewed to ensure proper accounting of these contracts once this ASU is effective. Devon anticipates the adoption of this standard will significantly impact its consolidated financial statements, systems, processes and controls and is evaluating technology requirements and solutions needed to comply with the requirements of this ASU.

The FASB issued ASU No. 2017-07, Compensation – Retirement Benefits (Topic 715), Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. This ASU will require entities to present the service cost component of net periodic benefit cost in the same line item as other employee compensation costs and present the other components of net periodic benefit cost outside of operating income in the statement of earnings. Only the service cost component of net periodic benefit cost is eligible for capitalization. This ASU is effective for Devon beginning January 1, 2018, and presentation changes in the statement of earnings will be applied retrospectively, while service cost component capitalization will be applied prospectively. Upon adoption of this ASU, Devon will reclassify $7 million, $14 million and $16 million of non-service cost components of net periodic benefit costs for 2017, 2016 and 2015, respectively, as other nonoperating items. Such amounts are currently classified in Devon’s G&A. No other changes upon adopting this ASU are expected to be material.

Devon is party to various legal actions arising in the normal course of business. Matters that are probable of unfavorable outcome to Devon and which can be reasonably estimated are accrued. Such accruals are based on information known about the matters, Devon’s estimates of the outcomes of such matters and its experience in contesting, litigating and settling similar matters. None of the actions are believed by management to involve future amounts that would be material to Devon’s financial position or results of operations after consideration of recorded accruals. Actual amounts could differ materially from management’s estimates.

Acquisitions And Divestitures (Tables)
Summary of the Gain Computation

A summary of the gain computation follows.

 

 

Three Months Ended September 30, 2016

 

 

 

(Millions)

 

Proceeds received, net of purchase price adjustments and selling costs

 

$

1,653

 

Asset retirement obligation assumed by purchasers

 

 

250

 

Total consideration received

 

 

1,903

 

 

 

 

 

 

Allocated oil and gas property basis sold

 

 

355

 

Allocated goodwill

 

 

197

 

Total assets sold

 

 

552

 

 

 

 

 

 

Gain on asset sales

 

$

1,351

 

 

Derivative Financial Instruments (Tables)

The following table presents the net gains and losses by derivative financial instrument type followed by the corresponding individual consolidated comprehensive statements of earnings caption.

 

 

 

Three Months Ended

September 30,

 

 

Nine Months Ended

September 30,

 

 

 

2017

 

 

2016

 

 

2017

 

 

2016

 

 

 

(Millions)

 

Commodity derivatives:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Oil, gas and NGL derivatives

 

$

(144

)

 

$

79

 

 

$

214

 

 

$

(30

)

Marketing and midstream revenues

 

 

(5

)

 

 

(1

)

 

 

3

 

 

 

(7

)

Interest rate derivatives:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other nonoperating items

 

 

(4

)

 

 

(20

)

 

 

(19

)

 

 

(163

)

Foreign currency derivatives:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other nonoperating items

 

 

 

 

 

 

 

 

 

 

 

(159

)

Net gains (losses) recognized

 

$

(153

)

 

$

58

 

 

$

198

 

 

$

(359

)

 

The following table presents the derivative fair values by derivative financial instrument type followed by the corresponding individual consolidated balance sheet caption.

 

 

 

September 30, 2017

 

 

December 31, 2016

 

 

 

(Millions)

 

Commodity derivative assets:

 

 

 

 

 

 

 

 

Other current assets

 

$

39

 

 

$

9

 

Other long-term assets

 

 

4

 

 

 

1

 

Interest rate derivative assets:

 

 

 

 

 

 

 

 

Other current assets

 

 

1

 

 

 

1

 

Total derivative assets

 

$

44

 

 

$

11

 

Commodity derivative liabilities:

 

 

 

 

 

 

 

 

Other current liabilities

 

$

53

 

 

$

187

 

Other long-term liabilities

 

 

7

 

 

 

16

 

Interest rate derivative liabilities:

 

 

 

 

 

 

 

 

Other current liabilities

 

 

1

 

 

 

 

Other long-term liabilities

 

 

61

 

 

 

41

 

Total derivative liabilities

 

$

122

 

 

$

244

 

 

 

Notional

 

 

Rate Received

 

 

Rate Paid

 

 

Expiration

(Millions)

 

 

 

 

 

 

 

 

 

 

 

$

750

 

 

Three Month LIBOR

 

 

 

2.98%

 

 

December 2048 (1)

$

100

 

 

 

1.76%

 

 

Three Month LIBOR

 

 

January 2019

 

(1)

Mandatory settlement in December 2018.

 

 

Price Swaps

 

 

Price Collars

 

Period

 

Volume

(Bbls/d)

 

 

Weighted

Average

Price ($/Bbl)

 

 

Volume

(Bbls/d)

 

 

Weighted

Average Floor

Price ($/Bbl)

 

 

Weighted

Average

Ceiling Price

($/Bbl)

 

Q4 2017

 

 

82,167

 

 

$

53.87

 

 

 

79,200

 

 

$

45.51

 

 

$

57.41

 

Q1-Q4 2018

 

 

22,792

 

 

$

51.13

 

 

 

34,121

 

 

$

45.71

 

 

$

55.71

 

Q1-Q4 2019

 

 

1,356

 

 

$

49.79

 

 

 

2,096

 

 

$

44.10

 

 

$

54.10

 

 

 

 

Oil Basis Swaps

 

Period

 

Index

 

Volume (Bbls/d)

 

 

Weighted Average

Differential to WTI

($/Bbl)

 

Q4 2017

 

Midland Sweet

 

 

20,000

 

 

$

(0.41

)

Q4 2017

 

Western Canadian Select

 

 

87,304

 

 

$

(14.57

)

Q1-Q4 2018

 

Midland Sweet

 

 

23,000

 

 

$

(1.02

)

Q1-Q4 2018

 

Western Canadian Select

 

 

59,718

 

 

$

(14.85

)

Q1-Q4 2019

 

Midland Sweet

 

 

1,000

 

 

$

(0.80

)

 

 

 

 

Price Swaps

 

 

Price Collars

 

Period

 

Volume (MMBtu/d)

 

 

Weighted Average Price ($/MMBtu)

 

 

Volume (MMBtu/d)

 

 

Weighted Average Floor Price ($/MMBtu)

 

 

Weighted Average

Ceiling Price ($/MMBtu)

 

Q4 2017

 

 

331,196

 

 

$

3.21

 

 

 

455,000

 

 

$

3.03

 

 

$

3.41

 

Q1-Q4 2018

 

 

261,888

 

 

$

3.09

 

 

 

149,982

 

 

$

2.99

 

 

$

3.30

 

Q1-Q4 2019

 

 

6,164

 

 

$

3.08

 

 

 

8,630

 

 

$

2.92

 

 

$

3.22

 

 

 

 

Natural Gas Basis Swaps

 

Period

 

Index

 

Volume

(MMBtu/d)

 

 

Weighted Average

Differential to

Henry Hub

($/MMBtu)

 

Q4 2017

 

Panhandle Eastern Pipe Line

 

 

150,000

 

 

$

(0.34

)

Q4 2017

 

El Paso Natural Gas

 

 

80,000

 

 

$

(0.13

)

Q4 2017

 

Houston Ship Channel

 

 

35,000

 

 

$

0.06

 

Q4 2017

 

Transco Zone 4

 

 

205,000

 

 

$

0.03

 

Q1-Q4 2018

 

Panhandle Eastern Pipe Line

 

 

50,000

 

 

$

(0.29

)

 

 

 

 

 

 

 

Price Swaps

 

 

Price Collars

 

Period

 

Product

 

Volume (Bbls/d)

 

 

Weighted Average Price ($/Bbl)

 

 

Volume (Bbls/d)

 

 

Weighted Average Floor Price ($/Bbl)

 

 

Weighted Average Ceiling Price ($/Bbl)

 

Q4 2017

 

Propane

 

 

2,663

 

 

$

31.98

 

 

 

1,000

 

 

$

28.35

 

 

$

30.45

 

 

 

Period

 

Product

 

Volume (Total)

 

Weighted Average Price Paid

 

Weighted Average Price Received

Q4 2017-Q3 2018

 

Propane

 

 

537

 

MBbls

 

Index

 

$0.66/gal

Q4 2017-Q3 2018

 

Normal Butane

 

 

344

 

MBbls

 

Index

 

$0.77/gal

 

Share-Based Compensation (Tables)

 

 

 

Nine Months Ended September 30,

 

 

 

2017

 

 

2016

 

 

 

(Millions)

 

Gross G&A for share-based compensation

 

$

141

 

 

$

117

 

Share-based compensation expense capitalized pursuant to

   the full cost method of accounting for oil and gas properties

 

$

31

 

 

$

30

 

Related income tax benefit

 

$

3

 

 

$

3

 

 

 

 

 

Restricted Stock

 

 

Performance-Based

 

 

Performance

 

 

 

Awards and Units

 

 

Restricted Stock Awards

 

 

Share Units

 

 

 

Awards and

Units

 

 

Weighted

Average

Grant-Date

Fair Value

 

 

Awards

 

 

Weighted

Average

Grant-Date

Fair Value

 

 

Units

 

 

 

 

 

Weighted

Average

Grant-Date

Fair Value

 

 

 

(Thousands, except fair value data)

 

Unvested at 12/31/16

 

 

6,407

 

 

$

34.40

 

 

 

585

 

 

$

37.60

 

 

 

2,604

 

 

 

 

 

$

46.66

 

Granted

 

 

2,691

 

 

$

44.87

 

 

 

223

 

 

$

44.85

 

 

 

1,010

 

 

 

 

 

$

52.58

 

Vested

 

 

(2,321

)

 

$

39.51

 

 

 

(233

)

 

$

41.27

 

 

 

(832

)

 

 

 

 

$

78.19

 

Forfeited

 

 

(252

)

 

$

36.06

 

 

 

 

 

$

 

 

 

(24

)

 

 

 

 

$

40.70

 

Unvested at 9/30/17

 

 

6,525

 

 

$

36.83

 

 

 

575

 

 

$

38.92

 

 

 

2,758

 

 

(1

)

 

$

41.21

 

 

(1)

A maximum of 5.5 million common shares could be awarded based upon Devon’s final TSR ranking relative to Devon’s peer group established under applicable award agreements.

 

 

 

2017

 

Grant-date fair value

 

$

51.05

 

 

 

$

53.12

 

Risk-free interest rate

 

1.50%

 

Volatility factor

 

45.8%

 

Contractual term (years)

 

2.89

 

 

 

 

 

 

 

 

 

Performance-Based

 

 

 

 

 

 

 

Restricted Stock

 

 

Restricted Stock

 

 

Performance

 

 

 

Awards and Units

 

 

Awards

 

 

Share Units

 

Unrecognized compensation cost (millions)

 

$

160

 

 

$

6

 

 

$

35

 

Weighted average period for recognition (years)

 

 

2.5

 

 

 

1.8

 

 

 

2.0

 

 

 

 

 

General Partner

 

 

EnLink

 

 

 

Restricted

 

 

Performance

 

 

Restricted

 

 

Performance

 

 

 

Incentive Units

 

 

Units

 

 

Incentive Units

 

 

Units

 

Unrecognized compensation cost (millions)

 

$

14

 

 

$

6

 

 

$

15

 

 

$

6

 

Weighted average period for recognition (years)

 

 

1.8

 

 

 

2.0

 

 

 

1.7

 

 

 

1.9

 

 

Asset Impairments (Tables)
Components of Asset Impairments

 

The following table presents the components of asset impairments.

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

2017

 

 

2016

 

 

2017

 

 

2016

 

 

 

(Millions)

 

U.S. oil and gas assets

 

$

 

 

$

317

 

 

$

 

 

$

2,810

 

Canada oil and gas assets

 

 

 

 

 

 

 

 

 

 

 

1,166

 

EnLink goodwill

 

 

 

 

 

 

 

 

 

 

 

873

 

Other assets

 

 

2

 

 

 

2

 

 

 

9

 

 

 

2

 

Total asset impairments

 

$

2

 

 

$

319

 

 

$

9

 

 

$

4,851

 

 

Restructuring And Transaction Costs (Tables)

 

 

September 30, 2016

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

(Millions)

 

2016 reduction in workforce:

 

 

 

 

 

 

 

 

Employee related costs

 

$

(7

)

 

$

229

 

Lease obligations

 

 

 

 

 

17

 

Asset impairments

 

 

 

 

 

3

 

Transaction costs

 

 

2

 

 

 

17

 

Restructuring and transaction costs

 

$

(5

)

 

$

266

 

 

 

 

Other

 

 

Other

 

 

 

 

 

 

 

Current

 

 

Long-term

 

 

 

 

 

 

 

Liabilities

 

 

Liabilities

 

 

Total

 

 

 

(Millions)

 

Balance as of December 31, 2016

 

$

48

 

 

$

62

 

 

$

110

 

Changes due to 2016 workforce reductions

 

 

(25

)

 

 

(2

)

 

 

(27

)

Changes related to prior years' restructurings

 

 

(3

)

 

 

(24

)

 

 

(27

)

Balance as of September 30, 2017

 

$

20

 

 

$

36

 

 

$

56

 

Balance as of December 31, 2015

 

$

13

 

 

$

63

 

 

$

76

 

Changes due to 2016 workforce reductions

 

 

58

 

 

 

13

 

 

 

71

 

Changes related to prior years' restructurings

 

 

5

 

 

 

(8

)

 

 

(3

)

Balance as of September 30, 2016

 

$

76

 

 

$

68

 

 

$

144

 

 

Income Taxes (Tables)
Schedule Of Effective Income Tax Rate Reconciliation

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

2017

 

 

2016

 

 

2017

 

 

2016

 

 

 

(Millions)

 

Current income tax expense

 

$

39

 

 

$

85

 

 

$

71

 

 

$

72

 

Deferred income tax expense (benefit)

 

 

(14

)

 

 

86

 

 

 

(20

)

 

 

(300

)

Total income tax expense (benefit)

 

$

25

 

 

$

171

 

 

$

51

 

 

$

(228

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. statutory income tax rate

 

 

35

%

 

 

35

%

 

 

35

%

 

 

35

%

Deferred tax asset valuation allowance

 

 

(9

%)

 

 

(35

%)

 

 

(25

%)

 

 

(20

%)

Non-deductible goodwill impairments

 

 

0

%

 

 

6

%

 

 

0

%

 

 

(9

%)

Change in unrecognized tax benefits

 

 

3

%

 

 

7

%

 

 

1

%

 

 

(2

%)

Taxation on Canadian operations

 

 

(1

%)

 

 

0

%

 

 

0

%

 

 

(3

%)

State income taxes

 

 

0

%

 

 

2

%

 

 

0

%

 

 

1

%

Other

 

 

(19

%)

 

 

0

%

 

 

(7

%)

 

 

3

%

Effective income tax rate

 

 

9

%

 

 

15

%

 

 

4

%

 

 

5

%

 

Net Earnings (Loss) Per Share Attributable to Devon (Tables)
Net Earnings (Loss) Per Share Computations

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

2017

 

 

2016

 

 

2017

 

 

2016

 

 

 

(Millions, except per share amounts)

 

Net earnings (loss):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net earnings (loss) attributable to Devon

 

$

228

 

 

$

993

 

 

$

1,218

 

 

$

(3,633

)

Attributable to participating securities

 

 

(2

)

 

 

(11

)

 

 

(13

)

 

 

(1

)

Basic and diluted earnings (loss)

 

$

226

 

 

$

982

 

 

$

1,205

 

 

$

(3,634

)

Common shares:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common shares outstanding - total

 

 

526

 

 

 

524

 

 

 

525

 

 

 

509

 

Attributable to participating securities

 

 

(6

)

 

 

(6

)

 

 

(6

)

 

 

(6

)

Common shares outstanding - basic

 

 

520

 

 

 

518

 

 

 

519

 

 

 

503

 

Dilutive effect of potential common shares issuable

 

 

3

 

 

 

3

 

 

 

3

 

 

 

 

Common shares outstanding - diluted

 

 

523

 

 

 

521

 

 

 

522

 

 

 

503

 

Net earnings (loss) per share attributable to Devon:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.43

 

 

$

1.90

 

 

$

2.32

 

 

$

(7.22

)

Diluted

 

$

0.43

 

 

$

1.89

 

 

$

2.31

 

 

$

(7.22

)

Antidilutive options (1)

 

 

2

 

 

 

3

 

 

 

2

 

 

 

3

 

 

(1)

Amounts represent options to purchase shares of Devon’s common stock that are excluded from the diluted net earnings (loss) per share calculations because the options are antidilutive.

Other Comprehensive Earnings (Tables)
Components Of Other Comprehensive Earnings

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

2017

 

 

2016

 

 

2017

 

 

2016

 

 

 

(Millions)

 

Foreign currency translation:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Beginning accumulated foreign currency translation

 

$

456

 

 

$

450

 

 

$

456

 

 

$

424

 

Change in cumulative translation adjustment

 

 

17

 

 

 

(1

)

 

 

31

 

 

 

52

 

Income tax benefit (expense)

 

 

(16

)

 

 

3

 

 

 

(30

)

 

 

(24

)

Ending accumulated foreign currency translation

 

 

457

 

 

 

452

 

 

 

457

 

 

 

452

 

Pension and postretirement benefit plans:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Beginning accumulated pension and postretirement benefits

 

 

(163

)

 

 

(185

)

 

 

(172

)

 

 

(194

)

Recognition of net actuarial loss and prior

   service cost in earnings (1)

 

 

5

 

 

 

7

 

 

 

14

 

 

 

20

 

Income tax benefit

 

 

 

 

 

4

 

 

 

 

 

 

 

Ending accumulated pension and postretirement benefits

 

 

(158

)

 

 

(174

)

 

 

(158

)

 

 

(174

)

Other

 

 

(2

)

 

 

 

 

 

(2

)

 

 

 

Accumulated other comprehensive earnings, net of tax

 

$

297

 

 

$

278

 

 

$

297

 

 

$

278

 

 

(1)

These accumulated other comprehensive earnings components are included in the computation of net periodic benefit cost, which is a component of G&A on the accompanying consolidated comprehensive statements of earnings. See Note 16 for additional details.

Supplemental Information To Statements Of Cash Flows (Tables)
Schedule Of Supplemental Information To Statements Of Cash Flows

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

2017

 

 

2016

 

 

2017

 

 

2016

 

 

 

(Millions)

 

Net change in working capital accounts,

    net of assets and liabilities assumed:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accounts receivable

 

$

(215

)

 

$

81

 

 

$

(85

)

 

$

87

 

Income taxes receivable

 

 

 

 

 

6

 

 

 

8

 

 

 

107

 

Other current assets

 

 

12

 

 

 

98

 

 

 

(43

)

 

 

242

 

Accounts payable

 

 

48

 

 

 

(34

)

 

 

98

 

 

 

(185

)

Revenues and royalties payable

 

 

63

 

 

 

40

 

 

 

92

 

 

 

34

 

Other current liabilities

 

 

99

 

 

 

(54

)

 

 

24

 

 

 

(77

)

Net change in working capital

 

$

7

 

 

$

137

 

 

$

94

 

 

$

208

 

Interest paid (net of capitalized interest)

 

$

49

 

 

$

113

 

 

$

285

 

 

$

402

 

Income taxes paid (received)

 

$

 

 

$

(7

)

 

$

(1)

 

 

$

(130

)

 

Accounts Receivable (Tables)
Schedule Of Components Of Accounts Receivable

Components of accounts receivable include the following:

 

 

 

September 30, 2017

 

 

December 31, 2016

 

 

 

(Millions)

 

Oil, gas and NGL sales

 

$

528

 

 

$

487

 

Joint interest billings

 

 

111

 

 

 

110

 

Marketing and midstream revenues

 

 

792

 

 

 

708

 

Other

 

 

44

 

 

 

69

 

Gross accounts receivable

 

 

1,475

 

 

 

1,374

 

Allowance for doubtful accounts

 

 

(13

)

 

 

(18

)

Net accounts receivable

 

$

1,462

 

 

$

1,356

 

 

Goodwill And Other Intangible Assets (Tables)
Schedule Of Other Intangible Assets

 

 

 

September 30, 2017

 

 

December 31, 2016

 

 

 

(Millions)

 

Customer relationships

 

$

1,796

 

 

$

1,796

 

Accumulated amortization

 

 

(202

)

 

 

(172

)

Net intangibles

 

$

1,594

 

 

$

1,624

 

 

Other Current Liabilities (Tables)
Schedule Of Other Current Liabilities

 

 

September 30, 2017

 

 

December 31, 2016

 

 

(Millions)

 

Installment payment - see Note 2

$

243

 

 

$

249

 

Accrued interest payable

 

204

 

 

 

130

 

Income taxes payable

 

197

 

 

 

32

 

Derivative liabilities

 

54

 

 

 

187

 

Restructuring liabilities

 

20

 

 

 

48

 

Other

 

285

 

 

 

420

 

Other current liabilities

$

1,003

 

 

$

1,066

 

 

Asset Retirement Obligations (Tables)
Summary Of Changes In Asset Retirement Obligations

 

 

Nine Months Ended September 30,

 

 

 

2017

 

 

2016

 

 

 

(Millions)

 

Asset retirement obligations as of beginning of period

 

$

1,272

 

 

$

1,414

 

Liabilities incurred and assumed through acquisitions

 

 

30

 

 

 

18

 

Liabilities settled and divested

 

 

(53

)

 

 

(310

)

Revision of estimated obligation

 

 

(184

)

 

 

70

 

Accretion expense on discounted obligation

 

 

47

 

 

 

58

 

Foreign currency translation adjustment

 

 

29

 

 

 

26

 

Asset retirement obligations as of end of period

 

 

1,141

 

 

 

1,276

 

Less current portion

 

 

41

 

 

 

46

 

Asset retirement obligations, long-term

 

$

1,100

 

 

$

1,230

 

 

Retirement Plans (Tables)
Schedule Of Net Periodic Benefit Cost For Pension And Postretirement Benefit Plans

 

 

Pension Benefits

 

 

Postretirement Benefits

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

September 30,

 

 

September 30,

 

 

 

2017

 

 

2016

 

 

2017

 

 

2016

 

 

2017

 

 

2016

 

 

2017

 

 

2016

 

 

 

(Millions)

 

Service cost

 

$

4

 

 

$

3

 

 

$

12

 

 

$

12

 

 

$

 

 

$

 

 

$

 

 

$

 

Interest cost

 

 

11

 

 

 

9

 

 

 

32

 

 

 

32

 

 

 

 

 

 

 

 

 

 

 

 

 

Expected return on plan assets

 

 

(14

)

 

 

(14

)

 

 

(41

)

 

 

(40

)

 

 

 

 

 

 

 

 

 

 

 

 

Amortization of prior service cost (1)

 

 

 

 

 

1

 

 

 

1

 

 

 

2

 

 

 

 

 

 

 

 

 

(1

)

 

 

(1

)

Net actuarial loss (1)

 

 

5

 

 

 

6

 

 

 

14

 

 

 

19

 

 

 

 

 

 

 

 

 

 

 

 

 

Net periodic benefit cost (2)

 

$

6

 

 

$

5

 

 

$

18

 

 

$

25

 

 

$

 

 

$

 

 

$

(1

)

 

$

(1

)

 

(1)

These net periodic benefit costs were reclassified out of other comprehensive earnings in the current period.

(2)    Net periodic benefit cost is a component of G&A in the accompanying consolidated comprehensive statements of earnings.

Stockholders' Equity (Tables)
Summary Of Dividends Paid On Common Stock

 

Amounts

 

 

Rate

 

 

(Millions)

 

 

(Per Share)

 

Quarter Ended 2017:

 

 

 

 

 

 

 

First quarter 2017

$

32

 

 

$

0.06

 

Second quarter 2017

 

33

 

 

$

0.06

 

Third quarter 2017

 

30

 

 

$

0.06

 

Total year-to-date

$

95

 

 

 

 

 

Quarter Ended 2016:

 

 

 

 

 

 

 

First quarter 2016

$

125

 

 

$

0.24

 

Second quarter 2016

 

33

 

 

$

0.06

 

Third quarter 2016

 

32

 

 

$

0.06

 

Total year-to-date

$

190

 

 

 

 

 

 

Fair Value Measurements (Tables)
Schedule Of Carrying Value And Fair Value Measurement Information For Financial Assets And Liabilities

 

 

 

 

 

 

 

 

 

 

 

Fair Value

 

 

 

 

 

 

 

 

 

 

 

Measurements Using:

 

 

 

Carrying

 

 

Total Fair

 

 

Level 1

 

 

Level 2

 

 

 

Amount

 

 

Value

 

 

Inputs

 

 

Inputs

 

 

 

(Millions)

 

September 30, 2017 assets (liabilities):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash equivalents

 

$

1,510

 

 

$

1,510

 

 

$

1,431

 

 

$

79

 

Commodity derivatives

 

$

43

 

 

$

43

 

 

$

 

 

$

43

 

Commodity derivatives

 

$

(60

)

 

$

(60

)

 

$

 

 

$

(60

)

Interest rate derivatives

 

$

1

 

 

$

1

 

 

$

 

 

$

1

 

Interest rate derivatives

 

$

(62

)

 

$

(62

)

 

$

 

 

$

(62

)

Debt

 

$

(10,403

)

 

$

(11,480

)

 

$

 

 

$

(11,480

)

Installment payment

 

$

(243

)

 

$

(244

)

 

$

 

 

$

(244

)

Capital lease obligations

 

$

(4

)

 

$

(4

)

 

$

 

 

$

(4

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2016 assets (liabilities):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash equivalents

 

$

1,542

 

 

$

1,542

 

 

$

1,298

 

 

$

244

 

Commodity derivatives

 

$

10

 

 

$

10

 

 

$

 

 

$

10

 

Commodity derivatives

 

$

(203

)

 

$

(203

)

 

$

 

 

$

(203

)

Interest rate derivatives

 

$

1

 

 

$

1

 

 

$

 

 

$

1

 

Interest rate derivatives

 

$

(41

)

 

$

(41

)

 

$

 

 

$

(41

)

Debt

 

$

(10,154

)

 

$

(10,760

)

 

$

 

 

$

(10,760

)

Installment payment

 

$

(473

)

 

$

(477

)

 

$

 

 

$

(477

)

Capital lease obligations

 

$

(7

)

 

$

(6

)

 

$

 

 

$

(6

)

 

Segment Information (Tables)
Condensed Statements Of Comprehensive Earnings And Balance Sheets Of Reportable Segments

 

 

 

U.S.

 

 

Canada

 

 

EnLink

 

 

Eliminations

 

 

Total

 

 

 

(Millions)

 

Three Months Ended September 30, 2017:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues from external customers

 

$

1,575

 

 

$

358

 

 

$

1,223

 

 

$

 

 

$

3,156

 

Asset dispositions and other

 

$

1

 

 

$

 

 

$

(1

)

 

$

 

 

$

 

Intersegment revenues

 

$

 

 

$

 

 

$

174

 

 

$

(174

)

 

$

 

Depreciation, depletion and amortization

 

$

195

 

 

$

63

 

 

$

142

 

 

$

 

 

$

400

 

Interest expense

 

$

82

 

 

$

17

 

 

$

49

 

 

$

(15

)

 

$

133

 

Asset impairments

 

$

 

 

$

 

 

$

2

 

 

$

 

 

$

2

 

Earnings before income taxes

 

$

167

 

 

$

85

 

 

$

20

 

 

$

 

 

$

272

 

Income tax expense

 

$

(5

)

 

$

28

 

 

$

2

 

 

$

 

 

$

25

 

Net earnings

 

$

172

 

 

$

57

 

 

$

18

 

 

$

 

 

$

247

 

Net earnings attributable to noncontrolling interests

 

$

 

 

$

 

 

$

19

 

 

$

 

 

$

19

 

Net earnings (loss) attributable to Devon

 

$

172

 

 

$

57

 

 

$

(1

)

 

$

 

 

$

228

 

Capital expenditures, including acquisitions

 

$

560

 

 

$

103

 

 

$

170

 

 

$

 

 

$

833

 

Three Months Ended September 30, 2016:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues from external customers

 

$

1,653

 

 

$

305

 

 

$

924

 

 

$

 

 

$

2,882

 

Asset dispositions and other

 

$

1,351

 

 

$

 

 

$

 

 

$

 

 

$

1,351

 

Intersegment revenues

 

$

 

 

$

 

 

$

180

 

 

$

(180

)

 

$

 

Depreciation, depletion and amortization

 

$

196

 

 

$

72

 

 

$

126

 

 

$

 

 

$

394

 

Interest expense

 

$

185

 

 

$

34

 

 

$

49

 

 

$

(23

)

 

$

245

 

Asset impairments

 

$

317

 

 

$

2

 

 

$

 

 

$

 

 

$

319

 

Restructuring and transaction costs

 

$

(10

)

 

$

5

 

 

$

 

 

$

 

 

$

(5

)

Earnings before income taxes

 

$

1,122

 

 

$

37

 

 

$

19

 

 

$

 

 

$

1,178

 

Income tax expense

 

$

5

 

 

$

159

 

 

$

7

 

 

$

 

 

$

171

 

Net earnings (loss)

 

$

1,117

 

 

$

(122

)

 

$

12

 

 

$

 

 

$

1,007

 

Net earnings attributable to noncontrolling interests

 

$

 

 

$

 

 

$

14

 

 

$

 

 

$

14

 

Net earnings (loss) attributable to Devon

 

$

1,117

 

 

$

(122

)

 

$

(2

)

 

$

 

 

$

993

 

Capital expenditures, including acquisitions

 

$

277

 

 

$

48

 

 

$

132

 

 

$

 

 

$

457

 

Nine Months Ended September 30, 2017:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues from external customers

 

$

5,547

 

 

$

951

 

 

$

3,468

 

 

$

 

 

$

9,966

 

Asset dispositions and other

 

$

11

 

 

$

 

 

$

(1

)

 

$

 

 

$

10

 

Intersegment revenues

 

$

 

 

$

 

 

$

515

 

 

$

(515

)

 

$

 

Depreciation, depletion and amortization

 

$

556

 

 

$

199

 

 

$

407

 

 

$

 

 

$

1,162

 

Interest expense

 

$

243

 

 

$

48

 

 

$

133

 

 

$

(42

)

 

$

382

 

Asset impairments

 

$

 

 

$

 

 

$

9

 

 

$

 

 

$

9

 

Earnings before income taxes

 

$

1,133

 

 

$

126

 

 

$

69

 

 

$

 

 

$

1,328

 

Income tax expense

 

$

 

 

$

42

 

 

$

9

 

 

$

 

 

$

51

 

Net earnings

 

$

1,133

 

 

$

84

 

 

$

60

 

 

$

 

 

$

1,277

 

Net earnings attributable to noncontrolling interests

 

$

 

 

$

 

 

$

59

 

 

$

 

 

$

59

 

Net earnings attributable to Devon

 

$

1,133

 

 

$

84

 

 

$

1

 

 

$

 

 

$

1,218

 

Property and equipment, net

 

$

7,726

 

 

$

2,787

 

 

$

6,569

 

 

$

 

 

$

17,082

 

Total assets

 

$

13,302

 

 

$

3,761

 

 

$

10,548

 

 

$

(52

)

 

$

27,559

 

Capital expenditures, including acquisitions

 

$

1,460

 

 

$

275

 

 

$

636

 

 

$

 

 

$

2,371

 

Nine Months Ended September 30, 2016:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues from external customers

 

$

4,320

 

 

$

688

 

 

$

2,488

 

 

$

 

 

$

7,496

 

Asset dispositions and other

 

$

1,351

 

 

$

 

 

$

 

 

$

 

 

$

1,351

 

Intersegment revenues

 

$

 

 

$

 

 

$

539

 

 

$

(539

)

 

$

 

Depreciation, depletion and amortization

 

$

763

 

 

$

284

 

 

$

373

 

 

$

 

 

$

1,420

 

Interest expense

 

$

400

 

 

$

101

 

 

$

140

 

 

$

(66

)

 

$

575

 

Asset impairments

 

$

2,810

 

 

$

1,168

 

 

$

873

 

 

$

 

 

$

4,851

 

Restructuring and transaction costs

 

$

245

 

 

$

15

 

 

$

6

 

 

$

 

 

$

266

 

Loss before income taxes

 

$

(2,040

)

 

$

(1,359

)

 

$

(853

)

 

$

 

 

$

(4,252

)

Income tax expense (benefit)

 

$

(6

)

 

$

(223

)

 

$

1

 

 

$

 

 

$

(228

)

Net loss

 

$

(2,034

)

 

$

(1,136

)

 

$

(854

)

 

$

 

 

$

(4,024

)

Net earnings (loss) attributable to noncontrolling interests

 

$

1

 

 

$

 

 

$

(392

)

 

$

 

 

$

(391

)

Net loss attributable to Devon

 

$

(2,035

)

 

$

(1,136

)

 

$

(462

)

 

$

 

 

$

(3,633

)

Property and equipment, net

 

$

7,196

 

 

$

2,778

 

 

$

6,195

 

 

$

 

 

$

16,169

 

Total assets

 

$

12,317

 

 

$

4,355

 

 

$

10,197

 

 

$

(56

)

 

$

26,813

 

Capital expenditures, including acquisitions

 

$

2,454

 

 

$

158

 

 

$

816

 

 

$

 

 

$

3,428

 

 

Summary Of Significant Accounting Policies (Narrative) (Details) (ASU 2017-07, Compensation – Retirement Benefits [Member], USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2017
Scenario, Forecast [Member]
New Accounting Pronouncements Or Change In Accounting Principle [Line Items]
 
 
 
Reclassification of non-service cost components of net periodic benefit costs
$ 14 
$ 16 
$ 7 
Acquisitions And Divestitures (Narrative) (Details) (USD $)
3 Months Ended 9 Months Ended 3 Months Ended 1 Months Ended 3 Months Ended 9 Months Ended 3 Months Ended 9 Months Ended 9 Months Ended 3 Months Ended 9 Months Ended 3 Months Ended 0 Months Ended 9 Months Ended 0 Months Ended 1 Months Ended 9 Months Ended 0 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
Mar. 31, 2017
EnLink [Member]
Howard Energy Partners [Member]
May 31, 2017
Forecasted
Jun. 30, 2016
Non Core Assets [Member]
Sep. 30, 2017
Non Core Assets [Member]
Sep. 30, 2016
East Texas, Anadarko Basin and Midland Basin [Member]
MMBoe
Sep. 30, 2016
Oil and Gas Properties [Member]
Sep. 30, 2017
Delaware Basin Joint Venture [Member]
EnLink [Member]
Sep. 30, 2016
Delaware Basin Joint Venture [Member]
EnLink [Member]
Aug. 1, 2016
Delaware Basin Joint Venture [Member]
EnLink [Member]
Sep. 30, 2016
Delaware Basin Joint Venture [Member]
EnLink [Member]
Joint Venture Partner [Member]
Aug. 1, 2016
Delaware Basin Joint Venture [Member]
EnLink [Member]
Joint Venture Partner [Member]
Jun. 30, 2016
US [Member]
Non Core Assets [Member]
Maximum [Member]
Sep. 30, 2017
US [Member]
Non Core Assets [Member]
Maximum [Member]
Sep. 30, 2016
US [Member]
East Texas, Anadarko Basin and Midland Basin [Member]
Maximum [Member]
Jan. 7, 2016
STACK [Member]
acre
Sep. 30, 2017
STACK [Member]
Jan. 7, 2016
STACK [Member]
Common Stock [Member]
Equity Issued in Business Combination [Member]
Jan. 7, 2016
Anadarko Basin [Member]
EnLink [Member]
Jan. 31, 2017
Anadarko Basin [Member]
EnLink [Member]
Sep. 30, 2017
Anadarko Basin [Member]
EnLink [Member]
Jan. 7, 2016
Anadarko Basin [Member]
Installment Payable, Noncurrent [Member]
EnLink [Member]
Jan. 7, 2016
Anadarko Basin [Member]
Equity Issued in Business Combination [Member]
General Partner [Member]
Business Acquisition [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Close date of acquisition
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Jan. 07, 2016 
 
 
 
Jan. 07, 2016 
 
 
Number of net acres acquired
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
80,000 
 
 
 
 
 
 
 
Aggregate purchase price
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 1,500,000,000 
 
 
$ 1,400,000,000 
 
 
 
 
Cash payment to acquire interest
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
849,000,000 
 
 
800,000,000 
 
 
 
 
Equity units value
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
659,000,000 
 
 
 
 
215,000,000 
Unproved properties
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,300,000,000 
 
 
 
 
 
 
Proved properties
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
200,000,000 
 
 
 
 
 
 
Divestitures of upstream assets
209,000,000 
1,680,000,000 
323,000,000 
1,889,000,000 
 
1,000,000,000 
200,000,000 
400,000,000 
1,700,000,000 
1,653,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Percentage of Estimated proved reserves associated with divestiture assets
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1.00% 
1.00% 
9.00% 
 
 
 
 
 
 
 
 
Estimated proved reserves associated with divestitures
 
 
 
 
 
 
 
 
146 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Gain on asset dispositions
 
1,351,000,000 
10,000,000 
1,351,000,000 
 
 
 
 
 
1,351,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Intangible assets
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,000,000,000 
 
 
Property, plant and equipment
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
400,000,000 
 
 
Amount committed to pay
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
500,000,000 
 
 
 
 
Commitment to pay cash due date
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1 year 
 
 
24 months 
 
Installment payable, current
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
250,000,000 
 
 
Installment payment, paid
 
 
250,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
250,000,000 
 
 
 
Installment payable, noncurrent
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
250,000,000 
 
Joint venture formation date
 
 
 
 
 
 
 
 
 
 
Aug. 01, 2016 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Ownership interest percentage acquired
 
 
 
 
 
 
 
 
 
 
 
 
50.10% 
 
49.90% 
 
 
 
 
 
 
 
 
 
 
 
Contribution of non monetary assets to joint venture
 
 
 
 
 
 
 
 
 
 
 
244,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Future capital commitments
 
 
 
 
 
 
 
 
 
 
 
262,000,000 
 
400,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
Cash contribution
 
 
 
 
 
 
 
 
 
 
 
 
 
138,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
Call rights to acquire increasing portions of joint venture partner's interest, start year
 
 
 
 
 
 
 
 
 
 
 
2021 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Proceeds from sale of investment
 
 
$ 190,000,000 
 
$ 190,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Acquisitions And Divestitures (Summary of Gain Computation) (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
Business Acquisition [Line Items]
 
 
 
 
Divestitures of property and equipment
$ 209 
$ 1,680 
$ 323 
$ 1,889 
Asset retirement obligation assumed by purchasers
 
 
53 
310 
Gain on asset sales
 
1,351 
10 
1,351 
Oil and Gas Properties [Member]
 
 
 
 
Business Acquisition [Line Items]
 
 
 
 
Divestitures of property and equipment
 
1,653 
 
 
Asset retirement obligation assumed by purchasers
 
250 
 
 
Total consideration received
 
1,903 
 
1,903 
Allocated oil and gas property basis sold
 
355 
 
355 
Allocated goodwill
 
197 
 
 
Total assets sold
 
552 
 
552 
Gain on asset sales
 
$ 1,351 
 
 
Derivative Financial Instruments (Schedule Of Open Oil Derivative Positions) (Details)
9 Months Ended
Sep. 30, 2017
bbl
NYMEX West Texas Intermediate Price Swaps Oil Q4 2017 [Member]
 
Derivative [Line Items]
 
Volume Per Day (Bbls/d)
82,167 
Weighted Average Price Swap
53.87 
NYMEX West Texas Intermediate Price Swaps Oil Q1-Q4 2018 [Member]
 
Derivative [Line Items]
 
Volume Per Day (Bbls/d)
22,792 
Weighted Average Price Swap
51.13 
NYMEX West Texas Intermediate Price Swaps Oil Q1-Q4 2019 [Member]
 
Derivative [Line Items]
 
Volume Per Day (Bbls/d)
1,356 
Weighted Average Price Swap
49.79 
NYMEX West Texas Intermediate Price Collars Oil Q4 2017 [Member]
 
Derivative [Line Items]
 
Volume Per Day (Bbls/d)
79,200 
Weighted Average Floor Price
45.51 
Weighted Average Ceiling Price
57.41 
NYMEX West Texas Intermediate Price Collars Oil Q1-Q4 2018 [Member]
 
Derivative [Line Items]
 
Volume Per Day (Bbls/d)
34,121 
Weighted Average Floor Price
45.71 
Weighted Average Ceiling Price
55.71 
NYMEX West Texas Intermediate Price Collars Oil Q1-Q4 2019 [Member]
 
Derivative [Line Items]
 
Volume Per Day (Bbls/d)
2,096 
Weighted Average Floor Price
44.10 
Weighted Average Ceiling Price
54.10 
Midland Sweet Basis Swaps Oil Q4 2017 [Member]
 
Derivative [Line Items]
 
Volume Per Day (Bbls/d)
20,000 
Weighted Average Differential To WTI
(0.41)
Midland Sweet Basis Swaps Oil Q1-Q4 2018 [Member]
 
Derivative [Line Items]
 
Volume Per Day (Bbls/d)
23,000 
Weighted Average Differential To WTI
(1.02)
Western Canadian Select Basis Swaps Oil Q4 2017 [Member]
 
Derivative [Line Items]
 
Volume Per Day (Bbls/d)
87,304 
Weighted Average Differential To WTI
(14.57)
Western Canadian Select Basis Swaps Oil Q1-Q4 2018 [Member]
 
Derivative [Line Items]
 
Volume Per Day (Bbls/d)
59,718 
Weighted Average Differential To WTI
(14.85)
Midland Sweet Basis Swaps Oil Q1-Q4 2019 [Member]
 
Derivative [Line Items]
 
Volume Per Day (Bbls/d)
1,000 
Weighted Average Differential To WTI
(0.80)
Derivative Financial Instruments (Schedule Of Open Natural Gas Derivative Positions) (Details)
9 Months Ended
Sep. 30, 2017
MMBTU
FERC Henry Hub Price Swaps Natural Gas Q4 2017 [Member]
 
Derivative [Line Items]
 
Volume Per Day (MMBtu/d)
331,196 
Weighted Average Price Swap
3.21 
FERC Henry Hub Price Swaps Natural Gas Q1-Q4 2018 [Member]
 
Derivative [Line Items]
 
Volume Per Day (MMBtu/d)
261,888 
Weighted Average Price Swap
3.09 
FERC Henry Hub Price Swaps Natural Gas Q1-Q4 2019 [Member]
 
Derivative [Line Items]
 
Volume Per Day (MMBtu/d)
6,164 
Weighted Average Price Swap
3.08 
FERC Henry Hub Price Collars Natural Gas Q4 2017 [Member]
 
Derivative [Line Items]
 
Volume Per Day (MMBtu/d)
455,000 
Weighted Average Floor Price
3.03 
Weighted Average Ceiling Price
3.41 
FERC Henry Hub Price Collars Natural Gas Q1-Q4 2018 [Member]
 
Derivative [Line Items]
 
Volume Per Day (MMBtu/d)
149,982 
Weighted Average Floor Price
2.99 
Weighted Average Ceiling Price
3.30 
FERC Henry Hub Price Collars Natural Gas Q1-Q4 2019 [Member]
 
Derivative [Line Items]
 
Volume Per Day (MMBtu/d)
8,630 
Weighted Average Floor Price
2.92 
Weighted Average Ceiling Price
3.22 
PEPL Basis Swaps Natural Gas Q4 2017 [Member]
 
Derivative [Line Items]
 
Volume Per Day (MMBtu/d)
150,000 
Weighted Average Differential To Henry Hub
(0.34)
PEPL Basis Swaps Natural Gas Q1-Q4 2018 [Member]
 
Derivative [Line Items]
 
Volume Per Day (MMBtu/d)
50,000 
Weighted Average Differential To Henry Hub
(0.29)
El Paso Natural Gas Basis Swaps Q4 2017 [Member]
 
Derivative [Line Items]
 
Volume Per Day (MMBtu/d)
80,000 
Weighted Average Differential To Henry Hub
(0.13)
Houston Ship Channel Natural Gas Basis Swaps Q4 2017 [Member]
 
Derivative [Line Items]
 
Volume Per Day (MMBtu/d)
35,000 
Weighted Average Differential To Henry Hub
0.06 
Transco Zone 4 Natural Gas Basis Swaps Q4 2017 [Member]
 
Derivative [Line Items]
 
Volume Per Day (MMBtu/d)
205,000 
Weighted Average Differential To Henry Hub
0.03 
Derivative Financial Instruments (Schedule Of Open NGL Derivative Positions) (Details)
9 Months Ended
Sep. 30, 2017
bbl
OPIS Mont Belvieu Texas Propane Price Swaps NGL Q4 2017 [Member]
 
Derivative [Line Items]
 
Volume Per Day (Bbls/d)
2,663 
Weighted Average Price Swap
31.98 
OPIS Mont Belvieu Texas Propane Price Collars NGL Q4 2017 [Member]
 
Derivative [Line Items]
 
Volume Per Day (Bbls/d)
1,000 
Weighted Average Floor Price
28.35 
Weighted Average Ceiling Price
30.45 
Derivative Financial Instruments (Schedule Of Open Interest Rate Swap Derivative Positions) (Details) (USD $)
In Millions, unless otherwise specified
9 Months Ended
Sep. 30, 2017
Interest Rate Contract 2.98% Expiration December 2048 [Member]
 
Derivative [Line Items]
 
Notional
$ 750 
Rate Received
Three Month LIBOR 
Rate Paid, percent
2.98% 
Expiration
Dec. 31, 2018 
Reference period end date
Dec. 31, 2048 1
Interest Rate Contract 1.76% Expiration January 2019 [Member]
 
Derivative [Line Items]
 
Notional
$ 100 
Rate Received, percent
1.76% 
Rate Paid
Three Month LIBOR 
Expiration
Jan. 31, 2019 
Derivative Financial Instruments (Schedule Of Derivative Financial Instruments Included In The Consolidated Comprehensive Statements Of Earnings) (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
Derivative [Line Items]
 
 
 
 
Net gains (losses) recognized in consolidated comprehensive statements of earnings
$ (153)
$ 58 
$ 198 
$ (359)
Commodity Derivatives [Member] |
Oil, Gas And NGL Derivatives [Member]
 
 
 
 
Derivative [Line Items]
 
 
 
 
Net gains (losses) recognized in consolidated comprehensive statements of earnings
(144)
79 
214 
(30)
Commodity Derivatives [Member] |
Marketing And Midstream Revenues [Member]
 
 
 
 
Derivative [Line Items]
 
 
 
 
Net gains (losses) recognized in consolidated comprehensive statements of earnings
(5)
(1)
(7)
Interest Rate Derivatives [Member] |
Other Nonoperating Items [Member]
 
 
 
 
Derivative [Line Items]
 
 
 
 
Net gains (losses) recognized in consolidated comprehensive statements of earnings
(4)
(20)
(19)
(163)
Foreign Currency Derivatives [Member] |
Other Nonoperating Items [Member]
 
 
 
 
Derivative [Line Items]
 
 
 
 
Net gains (losses) recognized in consolidated comprehensive statements of earnings
 
 
 
$ (159)
Derivative Financial Instruments (Schedule Of Derivative Financial Instruments Included In The Consolidated Balance Sheets) (Details) (USD $)
In Millions, unless otherwise specified
Sep. 30, 2017
Dec. 31, 2016
Derivatives Fair Value [Line Items]
 
 
Fair value of derivative assets
$ 44 
$ 11 
Fair value of derivative liabilities
122 
244 
Other Current Liabilities [Member]
 
 
Derivatives Fair Value [Line Items]
 
 
Fair value of derivative liabilities
54 
187 
Commodity Derivatives [Member] |
Other Current Assets [Member]
 
 
Derivatives Fair Value [Line Items]
 
 
Fair value of derivative assets
39 
Commodity Derivatives [Member] |
Other Long-Term Assets [Member]
 
 
Derivatives Fair Value [Line Items]
 
 
Fair value of derivative assets
Commodity Derivatives [Member] |
Other Current Liabilities [Member]
 
 
Derivatives Fair Value [Line Items]
 
 
Fair value of derivative liabilities
53 
187 
Commodity Derivatives [Member] |
Other Long-Term Liabilities [Member]
 
 
Derivatives Fair Value [Line Items]
 
 
Fair value of derivative liabilities
16 
Interest Rate Derivatives [Member] |
Other Current Assets [Member]
 
 
Derivatives Fair Value [Line Items]
 
 
Fair value of derivative assets
Interest Rate Derivatives [Member] |
Other Current Liabilities [Member]
 
 
Derivatives Fair Value [Line Items]
 
 
Fair value of derivative liabilities
 
Interest Rate Derivatives [Member] |
Other Long-Term Liabilities [Member]
 
 
Derivatives Fair Value [Line Items]
 
 
Fair value of derivative liabilities
$ 61 
$ 41 
Share-Based Compensation (Narrative) (Details) (USD $)
In Millions, except Share data, unless otherwise specified
9 Months Ended 3 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2016
Reduction of workforce [Member]
Sep. 30, 2017
General Partner And EnLink [Member]
Sep. 30, 2016
General Partner And EnLink [Member]
Mar. 31, 2017
General Partner And EnLink [Member]
Restricted Stock Awards And Units [Member]
Jun. 30, 2017
2017 Long-Term Incentive Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
 
 
 
 
Shares authorized for issuance
 
 
 
 
 
 
33,500,000 
Number of shares used to calculate shares that may be granted under the Long-Term Incentive Plan, options and stock appreciation rights
 
 
 
 
 
 
Number of shares used to calculate shares that may be granted under the Long-Term Incentive Plan, other awards
 
 
 
 
 
 
2.3 
Unit-based compensation
$ 141 
$ 117 
 
$ 28 
$ 18 
$ 10 
 
Expense associated with accelerated awards
 
 
$ 60 
 
 
 
 
Share-Based Compensation (Schedule Of The Effects Of Share Based Compensation Included In The Consolidated Comprehensive Statement Of Earnings) (Details) (USD $)
In Millions, unless otherwise specified
9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Share Based Compensation [Abstract]
 
 
Gross G&A for share-based compensation
$ 141 
$ 117 
Share-based compensation expense capitalized pursuant to the full cost method of accounting for oil and gas properties
31 
30 
Related income tax benefit
$ 3 
$ 3 
Share-Based Compensation (Summary Of Unvested Restricted Stock Awards and Units, Performance-Based Restricted Stock Awards And Performance Share Units) (Details) (USD $)
In Thousands, except Per Share data, unless otherwise specified
9 Months Ended
Sep. 30, 2017
Restricted Stock Awards And Units [Member]
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
Unvested at December 31, 2016
6,407 
Granted, awards and units
2,691 
Vested, awards and units
(2,321)
Forfeited, awards and units
(252)
Unvested at September 30, 2017
6,525 
Unvested weighted average grant-date fair value at December 31, 2016
$ 34.40 
Granted, weighted average grant-date fair value
$ 44.87 
Vested, weighted average grant-date fair value
$ 39.51 
Forfeited, weighted average grant-date fair value
$ 36.06 
Unvested weighted average grant-date fair value at September 30, 2017
$ 36.83 
Performance-Based Restricted Stock Awards [Member]
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
Unvested at December 31, 2016
585 
Granted, awards and units
223 
Vested, awards and units
(233)
Unvested at September 30, 2017
575 
Unvested weighted average grant-date fair value at December 31, 2016
$ 37.60 
Granted, weighted average grant-date fair value
$ 44.85 
Vested, weighted average grant-date fair value
$ 41.27 
Unvested weighted average grant-date fair value at September 30, 2017
$ 38.92 
Performance Share Units [Member]
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
Unvested at December 31, 2016
2,604 
Granted, awards and units
1,010 
Vested, awards and units
(832)
Forfeited, awards and units
(24)
Unvested at September 30, 2017
2,758 1
Unvested weighted average grant-date fair value at December 31, 2016
$ 46.66 
Granted, weighted average grant-date fair value
$ 52.58 
Vested, weighted average grant-date fair value
$ 78.19 
Forfeited, weighted average grant-date fair value
$ 40.70 
Unvested weighted average grant-date fair value at September 30, 2017
$ 41.21 
Share-Based Compensation (Summary Of Unvested Restricted Stock Awards and Units, Performance-Based Restricted Stock Awards And Performance Share Units) (Parenthetical) (Details) (Performance Share Units [Member], Maximum [Member])
In Millions, unless otherwise specified
9 Months Ended
Sep. 30, 2017
Performance Share Units [Member] |
Maximum [Member]
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
Maximum common shares that could be awarded based upon total shareholder return
5.5 
Share-Based Compensation (Summary of Unrecognized Compensation Cost And Weighted Average Period For Recognition) (Details) (USD $)
In Millions, unless otherwise specified
9 Months Ended
Sep. 30, 2017
Restricted Stock Awards And Units [Member]
 
Unrecognized Compensation And Weighted Average Recognition [Line Items]
 
Unrecognized compensation cost (millions)
$ 160 
Weighted average period for recognition (years)
2 years 6 months 
Performance-Based Restricted Stock Awards [Member]
 
Unrecognized Compensation And Weighted Average Recognition [Line Items]
 
Unrecognized compensation cost (millions)
Weighted average period for recognition (years)
1 year 9 months 18 days 
Performance Share Units [Member]
 
Unrecognized Compensation And Weighted Average Recognition [Line Items]
 
Unrecognized compensation cost (millions)
$ 35 
Weighted average period for recognition (years)
2 years 
Share-Based Compensation (Summary of Unrecognized Compensation Cost And Weighted Average Period For Recognition General Partner And EnLink) (Details) (USD $)
In Millions, unless otherwise specified
9 Months Ended
Sep. 30, 2017
Restricted Stock Awards And Units [Member]
 
Unrecognized Compensation And Weighted Average Recognition [Line Items]
 
Unrecognized compensation cost (millions)
$ 160 
Weighted average period for recognition (years)
2 years 6 months 
Performance Share Units [Member]
 
Unrecognized Compensation And Weighted Average Recognition [Line Items]
 
Unrecognized compensation cost (millions)
35 
Weighted average period for recognition (years)
2 years 
General Partner [Member] |
Restricted Stock Awards And Units [Member]
 
Unrecognized Compensation And Weighted Average Recognition [Line Items]
 
Unrecognized compensation cost (millions)
14 
Weighted average period for recognition (years)
1 year 9 months 18 days 
General Partner [Member] |
Performance Share Units [Member]
 
Unrecognized Compensation And Weighted Average Recognition [Line Items]
 
Unrecognized compensation cost (millions)
Weighted average period for recognition (years)
2 years 
EnLink [Member] |
Restricted Stock Awards And Units [Member]
 
Unrecognized Compensation And Weighted Average Recognition [Line Items]
 
Unrecognized compensation cost (millions)
15 
Weighted average period for recognition (years)
1 year 8 months 12 days 
EnLink [Member] |
Performance Share Units [Member]
 
Unrecognized Compensation And Weighted Average Recognition [Line Items]
 
Unrecognized compensation cost (millions)
$ 6 
Weighted average period for recognition (years)
1 year 10 months 24 days 
Asset Impairments (Components of Asset Impairments) (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended 3 Months Ended 9 Months Ended 3 Months Ended 9 Months Ended 3 Months Ended 9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
Mar. 31, 2016
General Partner And EnLink [Member]
Sep. 30, 2016
General Partner And EnLink [Member]
Sep. 30, 2016
U.S. Oil And Gas Assets [Member]
Sep. 30, 2016
U.S. Oil And Gas Assets [Member]
Sep. 30, 2016
Canada Oil And Gas Assets [Member]
Sep. 30, 2017
Other Assets [Member]
Sep. 30, 2016
Other Assets [Member]
Sep. 30, 2017
Other Assets [Member]
Sep. 30, 2016
Other Assets [Member]
Impaired Long-Lived Assets Held and Used [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
Asset impairment charges
$ 2 
$ 319 
$ 9 
$ 4,851 
 
 
$ 317 
$ 2,810 
$ 1,166 
$ 2 
$ 2 
$ 9 
$ 2 
Goodwill, impairment loss
 
 
 
 
$ 873 
$ 873 
 
 
 
 
 
 
 
Restructuring And Transaction Costs (Schedule Of The Components Of Restructuring And Transaction Costs Included In The Consolidated Comprehensive Statements Of Earnings) (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2016
Sep. 30, 2016
Restructuring Cost And Reserve [Line Items]
 
 
Restructuring and transaction costs
$ (5)
$ 266 
Employee Related Costs [Member] |
Reduction of workforce [Member]
 
 
Restructuring Cost And Reserve [Line Items]
 
 
Restructuring and transaction costs
(7)
229 
Lease Obligations [Member] |
Reduction of workforce [Member]
 
 
Restructuring Cost And Reserve [Line Items]
 
 
Restructuring and transaction costs
 
17 
Asset Impairments [Member] |
Reduction of workforce [Member]
 
 
Restructuring Cost And Reserve [Line Items]
 
 
Restructuring and transaction costs
 
Transaction Costs [Member]
 
 
Restructuring Cost And Reserve [Line Items]
 
 
Restructuring and transaction costs
$ 2 
$ 17 
Restructuring And Transaction Costs (Schedule Of The Activity And Balances Associated With Restructuring Liabilities) (Details) (USD $)
In Millions, unless otherwise specified
9 Months Ended 9 Months Ended 9 Months Ended
Sep. 30, 2017
Dec. 31, 2016
Sep. 30, 2016
Dec. 31, 2015
Sep. 30, 2017
Reduction of workforce [Member]
Sep. 30, 2016
Reduction of workforce [Member]
Sep. 30, 2017
Prior years' restructurings [Member]
Sep. 30, 2016
Prior years' restructurings [Member]
Sep. 30, 2017
Other Current Liabilities [Member]
Dec. 31, 2016
Other Current Liabilities [Member]
Sep. 30, 2016
Other Current Liabilities [Member]
Dec. 31, 2015
Other Current Liabilities [Member]
Sep. 30, 2017
Other Current Liabilities [Member]
Reduction of workforce [Member]
Sep. 30, 2016
Other Current Liabilities [Member]
Reduction of workforce [Member]
Sep. 30, 2017
Other Current Liabilities [Member]
Prior years' restructurings [Member]
Sep. 30, 2016
Other Current Liabilities [Member]
Prior years' restructurings [Member]
Sep. 30, 2017
Other Long-Term Liabilities [Member]
Dec. 31, 2016
Other Long-Term Liabilities [Member]
Sep. 30, 2016
Other Long-Term Liabilities [Member]
Dec. 31, 2015
Other Long-Term Liabilities [Member]
Sep. 30, 2017
Other Long-Term Liabilities [Member]
Reduction of workforce [Member]
Sep. 30, 2016
Other Long-Term Liabilities [Member]
Reduction of workforce [Member]
Sep. 30, 2017
Other Long-Term Liabilities [Member]
Prior years' restructurings [Member]
Sep. 30, 2016
Other Long-Term Liabilities [Member]
Prior years' restructurings [Member]
Restructuring Cost And Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Beginning balance
$ 56 
$ 110 
$ 144 
$ 76 
 
 
 
 
$ 20 
$ 48 
$ 76 
$ 13 
 
 
 
 
$ 36 
$ 62 
$ 68 
$ 63 
 
 
 
 
Restructuring reserve activity
 
 
 
 
(27)
71 
(27)
(3)
 
 
 
 
(25)
58 
(3)
 
 
 
 
(2)
13 
(24)
(8)
Ending balance
$ 56 
$ 110 
$ 144 
$ 76 
 
 
 
 
$ 20 
$ 48 
$ 76 
$ 13 
 
 
 
 
$ 36 
$ 62 
$ 68 
$ 63 
 
 
 
 
Restructuring And Transaction Costs (Narrative) (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2016
Sep. 30, 2016
Restructuring Cost And Reserve [Line Items]
 
 
Restructuring and transaction costs
$ (5)
$ 266 
Reduction of workforce [Member]
 
 
Restructuring Cost And Reserve [Line Items]
 
 
Expense associated with accelerated awards
 
60 
Employee Related Costs [Member] |
Reduction of workforce [Member]
 
 
Restructuring Cost And Reserve [Line Items]
 
 
Restructuring and transaction costs
(7)
229 
Estimated Defined Benefit Settlements [Member] |
Reduction of workforce [Member]
 
 
Restructuring Cost And Reserve [Line Items]
 
 
Restructuring and transaction costs
 
$ 30 
Income Taxes (Schedule Of Effective Income Tax Rate Reconciliation) (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
Income Tax Disclosure [Abstract]
 
 
 
 
Current income tax expense
$ 39 
$ 85 
$ 71 
$ 72 
Deferred income tax expense (benefit)
(14)
86 
(20)
(300)
Total income tax expense (benefit)
$ 25 
$ 171 
$ 51 
$ (228)
U.S. statutory income tax rate
35.00% 
35.00% 
35.00% 
35.00% 
Deferred tax asset valuation allowance
(9.00%)
(35.00%)
(25.00%)
(20.00%)
Non-deductible goodwill impairments
0.00% 
6.00% 
0.00% 
(9.00%)
Change in unrecognized tax benefits
3.00% 
7.00% 
1.00% 
(2.00%)
Taxation on Canadian operations
(1.00%)
0.00% 
0.00% 
(3.00%)
State income taxes
0.00% 
2.00% 
0.00% 
1.00% 
Other
(19.00%)
0.00% 
(7.00%)
3.00% 
Effective income tax rate
9.00% 
15.00% 
4.00% 
5.00% 
Income Taxes (Narrative) (Details) (USD $)
In Millions, unless otherwise specified
9 Months Ended 12 Months Ended 3 Months Ended 9 Months Ended 3 Months Ended
Sep. 30, 2017
Dec. 31, 2016
Mar. 31, 2016
General Partner And EnLink [Member]
Sep. 30, 2016
General Partner And EnLink [Member]
Sep. 30, 2017
United States [Member]
Sep. 30, 2016
United States [Member]
Sep. 30, 2016
Canada [Member]
Income Tax [Line Items]
 
 
 
 
 
 
 
Valuation allowance against U.S. deferred tax assets, percent
100.00% 
100.00% 
 
 
 
 
 
Change in deferred tax valuation allowance
 
 
 
 
$ (348)
$ 796 
$ 71 
Goodwill, impairment loss
 
 
$ 873 
$ 873 
 
 
 
Net Earnings (Loss) Per Share Attributable To Devon (Earnings Per Share Computations) (Details) (USD $)
In Millions, except Per Share data, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
Net earnings (loss):
 
 
 
 
Net earnings (loss) attributable to Devon
$ 228 
$ 993 
$ 1,218 
$ (3,633)
Attributable to participating securities
(2)
(11)
(13)
(1)
Basic and diluted earnings (loss)
$ 226 
$ 982 
$ 1,205 
$ (3,634)
Common shares:
 
 
 
 
Common shares outstanding - total
526 
524 
525 
509 
Attributable to participating securities
(6)
(6)
(6)
(6)
Common shares outstanding - basic
520 
518 
519 
503 
Dilutive effect of potential common shares issuable
 
Common shares outstanding - diluted
523 
521 
522 
503 
Net earnings (loss) per share attributable to Devon:
 
 
 
 
Basic
$ 0.43 
$ 1.90 
$ 2.32 
$ (7.22)
Diluted
$ 0.43 
$ 1.89 
$ 2.31 
$ (7.22)
Antidilutive options
1
1
1
1
Other Comprehensive Earnings (Components Of Other Comprehensive Earnings) (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
Dec. 31, 2016
Foreign currency translation:
 
 
 
 
 
Beginning accumulated foreign currency translation
$ 456 
$ 450 
$ 456 
$ 424 
 
Change in cumulative translation adjustment
17 
(1)
31 
52 
 
Income tax benefit (expense)
(16)
(30)
(24)
 
Ending accumulated foreign currency translation
457 
452 
457 
452 
 
Pension and postretirement benefit plans:
 
 
 
 
 
Beginning accumulated pension and postretirement benefits
(163)
(185)
(172)
(194)
 
Recognition of net actuarial loss and prior service cost in earnings
1
1
14 1
20 1
 
Income tax benefit
 
 
 
 
Ending accumulated pension and postretirement benefits
(158)
(174)
(158)
(174)
 
Other
(2)
 
(2)
 
 
Accumulated other comprehensive earnings, net of tax
$ 297 
$ 278 
$ 297 
$ 278 
$ 284 
Supplemental Information To Statements Of Cash Flows (Schedule Of Supplemental Information To Statements Of Cash Flows) (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
Net change in working capital accounts, net of assets and liabilities assumed:
 
 
 
 
Accounts receivable
$ (215)
$ 81 
$ (85)
$ 87 
Income taxes receivable
 
107 
Other current assets
12 
98 
(43)
242 
Accounts payable
48 
(34)
98 
(185)
Revenues and royalties payable
63 
40 
92 
34 
Other current liabilities
99 
(54)
24 
(77)
Net change in working capital
137 
94 
208 
Interest paid (net of capitalized interest)
49 
113 
285 
402 
Income taxes paid (received)
 
$ (7)
$ (1)
$ (130)
Accounts Receivable (Schedule Of Components Of Accounts Receivable) (Details) (USD $)
In Millions, unless otherwise specified
Sep. 30, 2017
Dec. 31, 2016
Accounts, Notes, Loans and Financing Receivable [Line Items]
 
 
Joint interest billings
$ 111 
$ 110 
Other
44 
69 
Gross accounts receivable
1,475 
1,374 
Allowance for doubtful accounts
(13)
(18)
Net accounts receivable
1,462 
1,356 
Oil, Gas And NGL Sales [Member]
 
 
Accounts, Notes, Loans and Financing Receivable [Line Items]
 
 
Gross accounts receivable
528 
487 
Marketing And Midstream Revenues [Member]
 
 
Accounts, Notes, Loans and Financing Receivable [Line Items]
 
 
Gross accounts receivable
$ 792 
$ 708 
Goodwill And Other Intangible Assets (Narrative) (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended 3 Months Ended 9 Months Ended 3 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2016
Upstream Oil And Gas Assets [Member]
Mar. 31, 2016
General Partner And EnLink [Member]
Sep. 30, 2016
General Partner And EnLink [Member]
Mar. 31, 2016
Crude And Condensate [Member]
General Partner And EnLink [Member]
Mar. 31, 2016
Texas [Member]
General Partner And EnLink [Member]
Mar. 31, 2016
General Partner [Member]
General Partner And EnLink [Member]
Goodwill [Line Items]
 
 
 
 
 
 
 
 
 
 
Goodwill impairments
 
 
 
 
 
$ 873 
$ 873 
$ 93 
$ 473 
$ 307 
Removal of goodwill for asset divestitures
 
 
 
 
197 
 
 
 
 
 
Weighted average amortization period, other intangible assets
 
 
15 years 
 
 
 
 
 
 
 
Amortization expense of intangible assets
37 
29 
96 
87 
 
 
 
 
 
 
Amortization expense, for each of the next five years
 
 
$ 123 
 
 
 
 
 
 
 
Goodwill And Other Intangible Assets (Schedule Of Other Intangible Assets) (Details) (USD $)
In Millions, unless otherwise specified
Sep. 30, 2017
Dec. 31, 2016
Goodwill And Intangible Assets Disclosure [Abstract]
 
 
Customer relationships
$ 1,796 
$ 1,796 
Accumulated amortization
(202)
(172)
Net intangibles
$ 1,594 
$ 1,624 
Other Current Liabilities (Schedule Of Other Current Liabilities) (Details) (USD $)
In Millions, unless otherwise specified
Sep. 30, 2017
Dec. 31, 2016
Other Liabilities, Current [Abstract]
 
 
Accrued interest payable
$ 204 
$ 130 
Income taxes payable
197 
32 
Derivative liabilities
122 
244 
Restructuring liabilities
20 
48 
Other
285 
420 
Other current liabilities
1,003 
1,066 
Installment Payable, Current [Member]
 
 
Other Liabilities, Current [Abstract]
 
 
Installment payment - see Note 2
243 
249 
Other Current Liabilities [Member]
 
 
Other Liabilities, Current [Abstract]
 
 
Derivative liabilities
$ 54 
$ 187 
Asset Retirement Obligations (Summary Of Changes In Asset Retirement Obligations) (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2017
Mar. 31, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
Dec. 31, 2016
Asset Retirement Obligation Disclosure [Abstract]
 
 
 
 
 
 
Asset retirement obligations as of beginning of period
 
$ 1,272 
 
$ 1,272 
$ 1,414 
 
Liabilities incurred and assumed through acquisitions
 
 
 
30 
18 
 
Liabilities settled and divested
 
 
 
(53)
(310)
 
Revision of estimated obligation
 
(184)
 
(184)
70 
 
Accretion expense on discounted obligation
16 
 
19 
47 
58 
 
Foreign currency translation adjustment
 
 
 
29 
26 
 
Asset retirement obligations as of end of period
1,141 
 
1,276 
1,141 
1,276 
 
Less current portion
41 
 
46 
41 
46 
 
Asset retirement obligations, long-term
$ 1,100 
 
$ 1,230 
$ 1,100 
$ 1,230 
$ 1,226 
Asset Retirement Obligations (Narrative) (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Mar. 31, 2017
Sep. 30, 2017
Sep. 30, 2016
Asset Retirement Obligations [Line Items]
 
 
 
Revisions of asset retirement obligations
$ (184)
$ (184)
$ 70 
Liabilities settled and divested
 
(53)
(310)
Upstream U.S. Assets [Member]
 
 
 
Asset Retirement Obligations [Line Items]
 
 
 
Liabilities settled and divested
 
 
$ (285)
Retirement Plans (Schedule Of Net Periodic Benefit Cost For Pension And Postretirement Benefit Plans) (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
Pension Benefits [Member]
 
 
 
 
Defined Benefit Plan Disclosure [Line Items]
 
 
 
 
Service cost
$ 4 
$ 3 
$ 12 
$ 12 
Interest cost
11 
32 
32 
Expected return on plan assets
(14)
(14)
(41)
(40)
Amortization of prior service cost
 
1
1
1
Net actuarial loss
1
1
14 1
19 1
Net periodic benefit cost
2
2
18 2
25 2
Postretirement Benefits [Member]
 
 
 
 
Defined Benefit Plan Disclosure [Line Items]
 
 
 
 
Amortization of prior service cost
 
 
(1)1
(1)1
Net periodic benefit cost
 
 
$ (1)2
$ (1)2
Stockholders' Equity (Narrative) (Details) (USD $)
In Millions, except Per Share data, unless otherwise specified
3 Months Ended 9 Months Ended 1 Months Ended
Sep. 30, 2017
Jun. 30, 2017
Mar. 31, 2017
Sep. 30, 2016
Jun. 30, 2016
Mar. 31, 2016
Sep. 30, 2016
Sep. 30, 2016
Common Stock [Member]
Feb. 29, 2016
Common Stock Offering [Member]
Feb. 29, 2016
Common Stock Offering [Member]
Underwriters [Member]
Jan. 31, 2016
Equity Issued in Business Combination [Member]
Common Stock [Member]
STACK [Member]
Stockholders Equity [Abstract]
 
 
 
 
 
 
 
 
 
 
 
Equity issued for acquisition
 
 
 
 
 
 
 
 
 
 
23 
Common stock, shares issued
 
 
 
 
 
 
 
103 
79 
10 
 
Net proceeds from offering
 
 
 
 
 
 
$ 1,469 
 
$ 1,500 
 
 
Common stock dividends, rate per share
$ 0.06 
$ 0.06 
$ 0.06 
$ 0.06 
$ 0.06 
$ 0.24 
 
 
 
 
 
Noncontrolling Interests (Narrative) (Details) (USD $)
In Millions, except Share data, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
Noncontrolling Interest [Line Items]
 
 
 
 
Distributions to unitholders other than Devon
$ 84 
$ 77 
$ 247 
$ 224 
EnLink [Member]
 
 
 
 
Noncontrolling Interest [Line Items]
 
 
 
 
Preferred units issued
400,000 
 
400,000 
 
Net proceeds of preferred units sold
394 
 
 
 
Ownership interest by Devon
23.00% 
 
23.00% 
 
EnLink [Member] |
Equity Distribution Agreements [Member]
 
 
 
 
Noncontrolling Interest [Line Items]
 
 
 
 
Common units sold
 
 
5,000,000 
7,000,000 
Net proceeds of common units sold
 
 
92 
110 
EnLink [Member] |
Equity Distribution Agreements [Member] |
Maximum [Member]
 
 
 
 
Noncontrolling Interest [Line Items]
 
 
 
 
Net proceeds of common units sold
600 
 
 
 
General Partner [Member]
 
 
 
 
Noncontrolling Interest [Line Items]
 
 
 
 
Ownership interest by Devon
64.00% 
 
64.00% 
 
General Partner And EnLink [Member]
 
 
 
 
Noncontrolling Interest [Line Items]
 
 
 
 
Distributions to unitholders other than Devon
 
 
$ 247 
$ 224 
Fair Value Measurements (Schedule Of Carrying Value And Fair Value Measurement Information For Financial Assets And Liabilities) (Details) (USD $)
In Millions, unless otherwise specified
Sep. 30, 2017
Dec. 31, 2016
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Derivatives, assets
$ 44 
$ 11 
Derivatives, liabilities
(122)
(244)
Carrying Amount [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Cash equivalents
1,510 
1,542 
Debt
(10,403)
(10,154)
Installment payment
(243)
(473)
Capital lease obligations
(4)
(7)
Carrying Amount [Member] |
Commodity Derivatives [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Derivatives, assets
43 
10 
Derivatives, liabilities
(60)
(203)
Carrying Amount [Member] |
Interest Rate Derivatives [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Derivatives, assets
Derivatives, liabilities
(62)
(41)
Total Fair Value [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Cash equivalents
1,510 
1,542 
Debt
(11,480)
(10,760)
Installment payment
(244)
(477)
Capital lease obligations
(4)
(6)
Total Fair Value [Member] |
Commodity Derivatives [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Derivatives, assets
43 
10 
Derivatives, liabilities
(60)
(203)
Total Fair Value [Member] |
Interest Rate Derivatives [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Derivatives, assets
Derivatives, liabilities
(62)
(41)
Level 1 Inputs [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Cash equivalents
1,431 
1,298 
Level 2 Inputs [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Cash equivalents
79 
244 
Debt
(11,480)
(10,760)
Installment payment
(244)
(477)
Capital lease obligations
(4)
(6)
Level 2 Inputs [Member] |
Commodity Derivatives [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Derivatives, assets
43 
10 
Derivatives, liabilities
(60)
(203)
Level 2 Inputs [Member] |
Interest Rate Derivatives [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Derivatives, assets
Derivatives, liabilities
$ (62)
$ (41)
Segment information (Condensed Statements Of Comprehensive Earnings And Balance Sheets Of Reportable Segments) (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
Dec. 31, 2016
Segment Reporting Information [Line Items]
 
 
 
 
 
Revenues from external customers
$ 3,156 
$ 2,882 
$ 9,966 
$ 7,496 
 
Asset dispositions and other
 
1,351 
10 
1,351 
 
Depreciation, depletion and amortization
400 
394 
1,162 
1,420 
 
Interest expense
133 
245 
382 
575 
 
Asset impairments
319 
4,851 
 
Restructuring and transaction costs
 
(5)
 
266 
 
Earnings (loss) before income taxes
272 
1,178 
1,328 
(4,252)
 
Income tax expense (benefit)
25 
171 
51 
(228)
 
Net earnings (loss)
247 
1,007 
1,277 
(4,024)
 
Net earnings (loss) attributable to noncontrolling interests
19 
14 
59 
(391)
 
Net earnings (loss) attributable to Devon
228 
993 
1,218 
(3,633)
 
Property and equipment, net
17,082 
16,169 
17,082 
16,169 
16,190 
Total assets
27,559 
26,813 
27,559 
26,813 
25,913 
Capital expenditures, including acquisitions
833 
457 
2,371 
3,428 
 
Eliminations [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Interest expense
(15)
(23)
(42)
(66)
 
Total assets
(52)
(56)
(52)
(56)
 
Eliminations [Member] |
Intersegment [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Revenues from external customers
(174)
(180)
(515)
(539)
 
United States [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Number of reportable segments
 
 
 
 
United States [Member] |
Operating Segments [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Revenues from external customers
1,575 
1,653 
5,547 
4,320 
 
Asset dispositions and other
1,351 
11 
1,351 
 
Depreciation, depletion and amortization
195 
196 
556 
763 
 
Interest expense
82 
185 
243 
400 
 
Asset impairments
 
317 
 
2,810 
 
Restructuring and transaction costs
 
(10)
 
245 
 
Earnings (loss) before income taxes
167 
1,122 
1,133 
(2,040)
 
Income tax expense (benefit)
(5)
 
(6)
 
Net earnings (loss)
172 
1,117 
1,133 
(2,034)
 
Net earnings (loss) attributable to noncontrolling interests
 
 
 
 
Net earnings (loss) attributable to Devon
172 
1,117 
1,133 
(2,035)
 
Property and equipment, net
7,726 
7,196 
7,726 
7,196 
 
Total assets
13,302 
12,317 
13,302 
12,317 
 
Capital expenditures, including acquisitions
560 
277 
1,460 
2,454 
 
Canada [Member] |
Operating Segments [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Revenues from external customers
358 
305 
951 
688 
 
Depreciation, depletion and amortization
63 
72 
199 
284 
 
Interest expense
17 
34 
48 
101 
 
Asset impairments
 
 
1,168 
 
Restructuring and transaction costs
 
 
15 
 
Earnings (loss) before income taxes
85 
37 
126 
(1,359)
 
Income tax expense (benefit)
28 
159 
42 
(223)
 
Net earnings (loss)
57 
(122)
84 
(1,136)
 
Net earnings (loss) attributable to Devon
57 
(122)
84 
(1,136)
 
Property and equipment, net
2,787 
2,778 
2,787 
2,778 
 
Total assets
3,761 
4,355 
3,761 
4,355 
 
Capital expenditures, including acquisitions
103 
48 
275 
158 
 
General Partner And EnLink [Member] |
Operating Segments [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Revenues from external customers
1,223 
924 
3,468 
2,488 
 
Asset dispositions and other
(1)
 
(1)
 
 
Depreciation, depletion and amortization
142 
126 
407 
373 
 
Interest expense
49 
49 
133 
140 
 
Asset impairments
 
873 
 
Restructuring and transaction costs
 
 
 
 
Earnings (loss) before income taxes
20 
19 
69 
(853)
 
Income tax expense (benefit)
 
Net earnings (loss)
18 
12 
60 
(854)
 
Net earnings (loss) attributable to noncontrolling interests
19 
14 
59 
(392)
 
Net earnings (loss) attributable to Devon
(1)
(2)
(462)
 
Property and equipment, net
6,569 
6,195 
6,569 
6,195 
 
Total assets
10,548 
10,197 
10,548 
10,197 
 
Capital expenditures, including acquisitions
170 
132 
636 
816 
 
General Partner And EnLink [Member] |
Operating Segments [Member] |
Intersegment [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Revenues from external customers
$ 174 
$ 180 
$ 515 
$ 539