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Property, Plant, and Equipment
12 Months Ended
Dec. 31, 2016
Property, Plant and Equipment [Abstract]  
Property, Plant and Equipment [Text Block]
Note 11 – Property, Plant, and Equipment
The following table presents nonregulated and regulated Property, plant, and equipment – net as presented on the Consolidated Balance Sheet for the years ended:
 
 
 
 
 
 
 
 
 
Estimated
Useful Life  (1)
(Years)
 
Depreciation
Rates (1)
(%)
 
December 31,
2016

2015
 
 
 
 
 
(Millions)
Nonregulated:
 
 
 
 
 
 
 
Natural gas gathering and processing facilities
5 - 40
 
 
 
$
20,413

 
$
20,789

Construction in progress
Not applicable
 
 
 
412

 
1,366

Other
2 - 45
 
 
 
2,202

 
2,170

Regulated:
 
 
 
 
 
 
 
Natural gas transmission facilities
 
 
1.20 - 6.97
 
12,692

 
12,189

Construction in progress
Not applicable
 
Not applicable
 
1,603

 
941

Other
5 - 45
 
1.35 - 33.33
 
1,590

 
1,584

Total property, plant, and equipment, at cost
 
 
 
 
38,912

 
39,039

Accumulated depreciation and amortization
 
 
 
 
(10,484
)
 
(9,460
)
Property, plant, and equipment — net
 
 
 
 
$
28,428

 
$
29,579

__________
(1)
Estimated useful life and depreciation rates are presented as of December 31, 2016. Depreciation rates and estimated useful lives for regulated assets are prescribed by the FERC.
Depreciation and amortization expense for Property, plant, and equipment – net was $1,407 million, $1,382 million, and $967 million in 2016, 2015, and 2014, respectively.
Regulated Property, plant, and equipment – net includes approximately $665 million and $706 million at December 31, 2016 and 2015, respectively, related to amounts in excess of the original cost of the regulated facilities within our gas pipeline businesses as a result of our prior acquisitions. This amount is being amortized over 40 years using the straight-line amortization method. Current FERC policy does not permit recovery through rates for amounts in excess of original cost of construction.
Asset Retirement Obligations
Our accrued obligations relate to underground storage caverns, offshore platforms and pipelines, fractionation and compression facilities, gas gathering well connections and pipelines, and gas transmission pipelines and facilities. At the end of the useful life of each respective asset, we are legally obligated to plug storage caverns and remove any related surface equipment, to restore land and remove surface equipment at gas processing, fractionation, and compression facilities, to dismantle offshore platforms and appropriately abandon offshore pipelines, to cap certain gathering pipelines at the wellhead connection and remove any related surface equipment, and to remove certain components of gas transmission facilities from the ground.
The following table presents the significant changes to our ARO, of which $801 million and $858 million are included in Regulatory liabilities, deferred income, and other with the remaining current portion in Accrued liabilities at December 31, 2016 and 2015, respectively.
 
December 31,
 
2016
 
2015
 
(Millions)
Beginning balance
$
915

 
$
831

Liabilities incurred
24

 
42

Liabilities settled
(8
)
 
(3
)
Accretion expense
69

 
60

Revisions (1)
(138
)
 
(15
)
Ending balance
$
862

 
$
915

___________
(1)
Several factors are considered in the annual review process, including inflation rates, current estimates for removal cost, market risk premiums, discount rates, and the estimated remaining useful life of the assets. The 2016 revisions reflect changes in removal cost estimates, increases in the estimated remaining useful life of certain assets, and decreases in the inflation rate and discount rates used in the annual review process. The 2015 revisions reflect changes in removal cost estimates and the estimated remaining useful life of assets, a decrease in the inflation rate, and increases in the discount rates used in the annual review process.
The funds Transco collects through a portion of its rates to fund its ARO are deposited into an external trust account dedicated to funding its ARO (ARO Trust). (See Note 17 – Fair Value Measurements, Guarantees, and Concentration of Credit Risk.) Under its current rate settlement, Transco’s annual funding obligation is approximately $36 million, with installments to be deposited monthly.