Retirement Plans

6 Months Ended

Jun. 30, 2019

(17) Retirement Plans:

The following tables provide the components of total pension and postretirement benefit cost:



	Pension Benefits
	For the three months ended				For the six months ended
	June 30,				June 30,

($ in millions)	2019		2018		2019		2018

Components of total pension benefit cost
Service cost	$	21	$	24	$	42	$	48
Interest cost on projected benefit obligation		32		30		65		60
Expected return on plan assets		(43)		(48)		(86)		(98)
Amortization of unrecognized loss		14		6		28		13
Net periodic pension benefit cost	$	24	$	12	$	49	$	23
Pension settlement costs		-		25		-		25
Total pension benefit cost	$	24	$	37	$	49	$	48


	Postretirement Benefits
	For the three months ended				For the six months ended
	June 30,				June 30,

($ in millions)	2019		2018		2019		2018

Components of net periodic postretirement benefit cost
Service cost	$	5	$	6	$	10	$	11
Interest cost on projected benefit obligation		11		10		21		19
Amortization of prior service cost (credit)		(3)		(3)		(4)		(5)
Amortization of unrecognized (gain) loss		-		-		(2)		1
Net periodic postretirement benefit cost	$	13	$	13	$	25	$	26

The components of net periodic benefit cost other than the service cost component are included in “Investment and other income” in the consolidated statement of operations.

During the first six months of 2019 and 2018, we capitalized $13 million and $14 million, respectively, of pension and OPEB expense into the cost of our capital expenditures, as the costs relate to our engineering and plant construction activities.

Our Pension Plan assets increased from $2,348 million at December 31, 2018 to $2,621 million at June 30, 2019, an increase of $273 million, or 12%. This increase was a result of contributions of $71 million and positive investment returns (net of investment management and administrative fees) of $338 million, partially offset by benefit payments of $136 million.

Required pension plan contributions for the full year 2019 are estimated to be $166 million, of which $71 million was contributed to the Plan during the first six months of 2019.