Sales and Other Operating Revenues

3 Months Ended

Mar. 31, 2019

Revenue from Contract with Customer [Abstract]

Revenue from Contract with Customer [Text Block]

Note20—Sales and Other Operating Revenues

Revenue from Contracts with Customers

The following table provides further disaggregation of our consolidated sales and other operating revenues:

	Millions of Dollars
	Three Months Ended
	March 31
	2019		2018
Revenue from contracts with customers	$	7,059	6,545
Revenue from contracts outside the scope of ASC Topic 606
Physical contracts meeting the definition of a derivative		2,081	2,261
Financial derivative contracts		10	(8)
Consolidated sales and other operating revenues	$	9,150	8,798

Revenues from contracts outside the scope of ASC Topic 606 relate primarily to physical gas contracts at market prices which qualify as derivatives accounted for under ASC Topic 815, “Derivatives and Hedging,” and for which we have not elected NPNS. There is no significant difference in contractual terms or the policy for recognition of revenue from these contracts and those within the scope of ASC Topic 606. The following disaggregation of revenues is provided in conjunction with Note 21—Segment Disclosures and Related Information:

	Millions of Dollars
	Three Months Ended
	March 31
	2019		2018
Revenue from Contracts Outside the Scope of ASC Topic 606 by Segment
Lower 48	$	1,613	1,713
Canada		241	191
Europe and North Africa		227	357
Physical contracts meeting the definition of a derivative	$	2,081	2,261

	Millions of Dollars
	Three Months Ended
	March 31
	2019		2018
Revenue from Contracts Outside the Scope of ASC Topic 606 by Product
Crude oil	$	188	286
Natural gas		1,768	1,890
Other		125	85
Physical contracts meeting the definition of a derivative	$	2,081	2,261

Practical Expedients

Typically, our commodity sales contracts are less than 12 months in duration; however, in certain specific cases may extend longer, which may be out to the end of field life. We have long-term commodity sales contracts which use prevailing market prices at the time of delivery, and under these contracts, the market-based variable consideration for each performance obligation (i.e., delivery of commodity) is allocated to each wholly unsatisfied performance obligation within the contract. Accordingly, we have applied the practical expedient allowed in ASC Topic 606 and do not disclose the aggregate amount of the transaction price allocated to performance obligations or when we expect to recognize revenues that are unsatisfied (or partially unsatisfied) as of the end of the reporting period.

Receivables and Contract Liabilities

Receivables from Contracts with Customers

At March 31, 2019, the “Accounts and notes receivable” line on our consolidated balance sheet, includes trade receivables of $2,638million compared with $2,889 million at December 31, 2018, and includes both contracts with customers within the scope of ASC Topic 606 and those that are outside the scope of ASC Topic 606. We typically receive payment within 30 days or less (depending on the terms of the invoice) once delivery is made. Revenues that are outside the scope of ASC Topic 606 relate primarily to physical gas sales contracts at market prices for which we do not elect NPNS and are therefore accounted for as a derivative under ASC Topic 815. There is little distinction in the nature of the customer or credit quality of trade receivables associated with gas sold under contracts for which NPNS has not been elected compared to trade receivables where NPNS has been elected.

Contract Liabilities from Contracts with Customers

We have entered into contractual arrangements where we license proprietary technology to customers related to the optimization process for operating LNG plants. The agreements typically provide for negotiated payments to be made at stated milestones. The payments are not directly related to our performance under the contract and are recorded as deferred revenue to be recognized as revenue when the customer can utilize and benefit from their right to use the license. Payments are received in installments over the construction period.

	Millions of Dollars
Contract Liabilities
At December 31, 2018	$	206
Contractual payments received		14
Revenue recognized		(133)
At March 31, 2019	$	87
Amounts Recognized in the Consolidated Balance Sheet at March 31, 2019
Current liabilities	$	49
Noncurrent liabilities		38
	$	87

We expect to recognize the contract liabilities as of March 31, 2019, as revenue between the remainder of 2019 and 2022.