Income Taxes (Tables)

12 Months Ended

Dec. 31, 2016

The provision (benefit) for income taxes from continuing operations consisted of:

	2016			2015			2014
	(In millions)
United States
Federal
Current	$	(27	)	$	(7	)	$	(1	)
Deferred taxes and other accruals		1,948			(995	)		156
State		23			(61	)		57
		1,944			(1,063	)		212
Foreign
Current		36			4			453
Deferred taxes and other accruals		235			(231	)		79
		271			(227	)		532
Total		2,215			(1,290	)		744
Adjustment of deferred taxes for foreign income tax law changes		7			(9	)		—
Total Provision (Benefit) For Income Taxes (a)	$	2,222		$	(1,299	)	$	744

(a)	Includes charges of $3,749 million in 2016 to establish valuation allowances on net deferred tax assets which is discussed further below.

Income (loss) from continuing operations before income taxes consisted of the following:

	2016			2015			2014
	(In millions)
United States (a)	$	(2,431	)	$	(2,728	)	$	676
Foreign		(1,423	)		(1,530	)		1,760
Total Income (Loss) from Continuing Operations Before Income Taxes	$	(3,854	)	$	(4,258	)	$	2,436

(a)	Includes substantially all of our interest expense, corporate expense and the results of commodity hedging activities.

The components of deferred tax liabilities and deferred tax assets at December 31 were as follows:

	2016			2015
	(In millions)
Deferred Tax Liabilities
Property, plant and equipment and investments	$	(3,810	)	$	(3,743	)
Other		(255	)		(257	)
Total Deferred Tax Liabilities		(4,065	)		(4,000	)
Deferred Tax Assets
Net operating loss carryforwards		5,767			3,852
Tax credit carryforwards		164			188
Property, plant and equipment and investments		834			981
Accrued compensation, deferred credits and other liabilities		526			492
Asset retirement obligations		1,077			1,220
Other		62			165
Total Deferred Tax Assets		8,430			6,898
Valuation allowances		(5,450	)		(1,579	)
Total deferred tax assets, net of valuation allowances		2,980			5,319
Net Deferred Tax Assets (Liabilities)	$	(1,085	)	$	1,319

In the Consolidated Balance Sheet, deferred tax assets and liabilities are netted by taxing jurisdiction and are recorded at December 31 as follows:

	2016			2015
	(In millions)
Deferred income taxes (long-term asset)	$	59		$	2,653
Deferred income taxes (long-term liability)		(1,144	)		(1,334	)
Net Deferred Tax Assets (Liabilities)	$	(1,085	)	$	1,319

The difference between our effective income tax rate from continuing operations and the U.S. statutory rate is reconciled below:

	2016				2015				2014
U.S. statutory rate		35.0		%		35.0		%		35.0		%
Effect of foreign operations (a)		4.6				5.9				0.7
State income taxes, net of Federal income tax		1.9				0.9				1.5
Change in enacted tax laws		(0.2	)			0.2				—
Gains on asset sales, net		—				(0.2	)			(8.3	)
Impairment		(2.1	)			(12.2	)			—
Valuation allowance against previously benefitted deferred tax assets		(97.3	)			(3.1	)			0.6
Benefit of legal entity restructuring		—				3.5				—
Other		0.4				0.5				1.0
Total		(57.7	)	%		30.5		%		30.5		%

(a)	The variance in effective income tax rates attributable to the effect of foreign operations primarily resulted from the mix of income among high and low tax rate jurisdictions.

Below is a reconciliation of the gross beginning and ending amounts of unrecognized tax benefits:

	2016	2015
	(In millions)
Balance at January 1	$ 604	$ 603
Additions based on tax positions taken in the current year	19	19
Additions based on tax positions of prior years	113	29
Reductions based on tax positions of prior years	(274)	(31)
Reductions due to settlements with taxing authorities	(27)	(12)
Reductions due to lapses in statutes of limitation	(11)	(4)
Balance at December 31	$ 424	$ 604