PENSION AND OTHER POSTRETIREMENT BENEFIT PLANS

3 Months Ended

Mar. 31, 2013

PENSION AND OTHER POSTRETIREMENT BENEFIT PLANS

PENSION AND OTHER POSTRETIREMENT BENEFIT PLANS

The components of net periodic benefit costs (credits) are:

	PENSION
	QUARTER ENDED
DOLLAR AMOUNTS IN MILLIONS	MARCH 2013			MARCH 2012
Service cost	$	16		$	14
Interest cost	60			65
Expected return on plan assets	(109		)	(105		)
Amortization of actuarial loss	55			42
Amortization of prior service cost	2			2
Total net periodic benefit cost	$	24		$	18

	OTHER POSTRETIREMENT BENEFITS
	QUARTER ENDED
DOLLAR AMOUNTS IN MILLIONS	MARCH 2013			MARCH 2012
Interest cost	$	3		$	4
Amortization of actuarial loss	3			4
Amortization of prior service credit	(6		)	(58		)
Other	—			4
Total net periodic benefit credit	$	—		$	(46	)

During fourth quarter 2011, we ratified amendments to our postretirement medical and life insurance benefit plans for U.S. salaried employees that reduced or eliminated certain benefits that were available to both past and present employees. The company recognized a gain of $52 million in first quarter 2012 due to these benefit changes. This gain is included in other operating income and reflected in the amortization of prior service credit in the table above.

FAIR VALUE OF PENSION PLAN ASSETS

As disclosed in our Annual Report on Form 10-K for the year ended December 31, 2012, the value reported for our pension plan assets at the end of 2012 was estimated. Additional information regarding the year-end values generally becomes available to us during the first half of the following year. We expect to complete the valuation of our pension plan assets during second quarter 2013. The final adjustments could affect net pension periodic benefit cost.

EXPECTED CONTRIBUTIONS AND BENEFIT PAYMENTS

As disclosed in our Annual Report on Form 10-K for the year ended December 31, 2012, in 2013 we expect to:

• make approximately$88 millionof required contributions to our Canadian registered and nonregistered pension plans in 2013;

• make benefit payments of$19 millionto our U.S. nonqualified pension plans; and

• make benefit payments of $37 millionrelated to our U.S. and Canadian other postretirement plans.

We donotanticipate making a contribution to our U.S. qualified pension plan for 2013.