LEASES (Notes)

12 Months Ended

Dec. 31, 2021

LEASES

Operating lease ROU assets are included in "Operating lease right-of-use assets" and finance lease ROU assets are included in "Net property" in the consolidated balance sheets. With respect to lease liabilities, operating lease liabilities are included in "Operating lease liabilities - current" and "Operating lease liabilities - noncurrent," and finance lease liabilities are included in "Long-term debt due within one year" and "Long-Term Debt" in the consolidated balance sheets.

The Corporation routinely leases product and utility production facilities, sales and administrative offices, warehouses and tanks for product storage, motor vehicles, railcars, computers, office machines and equipment. Some leases contain renewal provisions, purchase options and escalation clauses. The terms for these leased assets vary depending on the lease agreement. These leased assets have remaining lease terms of up to 19 years. The Corporation's lease agreements do not contain any material residual value guarantees or restrictive covenants.

The components of lease cost for operating and finance leases for the years ended December 31, 2021, 2020 and 2019 were as follows:


Lease Cost	2021		2020		2019
In millions
Operating lease cost	$	23	$	20	$	21
Short-term lease cost	28		22		25
Variable lease cost	39		8		4

Amortization of right-of-use assets - finance	3		2		1

Total lease cost	$	93	$	52	$	51

The following table provides supplemental cash flow and other information related to leases:


Other Lease Information	2021		2020		2019
In millions	2021		2020		2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows for operating leases	$	23	$	19	$	21
Financing cash flows for finance leases	$	3	$	2	$	1
Right-of-use assets obtained in exchange for lease obligations:
Operating leases 1	$	15	$	48	$	105
Finance leases	$	5	$	3	$	—

1.Includes $99 million for the year ended December 31, 2019 related to the adoption of ASU 2016-02, "Leases (Topic 842)" and the associated ASUs.

The following table summarizes the lease-related assets and liabilities recorded in the consolidated balance sheets at December 31, 2021 and 2020:


Lease Position	Balance Sheet Classification	Dec 31, 2021		Dec 31, 2020
In millions
Assets
Operating lease assets	Operating lease right-of-use assets	$	122	$	123
Finance lease assets	Property	19		15
Finance lease amortization	Accumulated depreciation	(11)		(8)
Total lease assets		$	130	$	130
Liabilities
Current
Operating	Operating lease liabilities - current	$	20	$	19
Finance	Long-term debt due within one year	3		2
Noncurrent
Operating	Operating lease liabilities - noncurrent	103		105
Finance	Long-Term Debt	6		5
Total lease liabilities		$	132	$	131

The weighted-average remaining lease term and discount rate for leases recorded in the consolidated balance sheets at December 31, 2021 and 2020 are provided below:


Lease Term and Discount Rate	Dec 31, 2021		Dec 31, 2020
Weighted-average remaining lease term
Operating leases	7.1 years		7.5 years
Finance leases	3.1 years		3.4 years
Weighted-average discount rate
Operating leases	3.17	%	3.28	%
Finance leases	2.53	%	3.62	%

The following table provides the maturities of lease liabilities at December 31, 2021:


Maturities of Lease Liabilities	Dec 31, 2021
In millions	Operating Leases		Finance Leases
2022	$	23	$	3
2023	23		3
2024	22		2
2025	20		1
2026	19		—
2027 and thereafter	30		—
Total future undiscounted lease payments	$	137	$	9
Less: Imputed interest	14		—
Total present value of lease liabilities	$	123	$	9

At December 31, 2021, the Corporation had additional leases of approximately $1 million for equipment which have not yet commenced. These leases are expected to commence in 2022, with lease terms of 2 years.