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Leases
 12 Months Ended
Dec. 31, 2022
Leases [Abstract]  
Leases
6.  Leases
Operating and finance lease obligations at December 31 included in the Consolidated Balance Sheet were as follows:
Operating LeasesFinance Leases
2022202120222021
(In millions)
Right-of-use assets — net (a)$570 $352 $126 $144 
Lease obligations:
Current$200 $70 $21 $19 
Long-term469 394 179 200 
Total lease obligations$669 $464 $200 $219 
(a)At December 31, 2022, finance lease ROU assets had a cost of $212 million (2021: $212 million) and accumulated amortization of $86 million (2021: $68 million).
Lease obligations represent 100% of the present value of future minimum lease payments in the lease arrangement.  Where we have contracted directly with a lessor in our role as operator of an unincorporated oil and gas venture, we bill our partners their proportionate share for reimbursements as payments under lease agreements become due pursuant to the terms of our joint operating and other agreements.
The nature of our leasing arrangements at December 31, 2022 was as follows:
Operating leases:  In the normal course of business, we primarily lease drilling rigs, equipment, logistical assets (offshore vessels, aircraft, and shorebases), and office space.
Finance leases:  In 2018, we entered into a sale and lease-back arrangement for a floating storage and offloading vessel (FSO) to handle produced condensate at North Malay Basin, offshore Peninsular Malaysia.  At December 31, 2022, the remaining lease term for the FSO was 10.8 years.
Maturities of lease obligations at December 31, 2022 were as follows:
 Operating LeasesFinance
Leases
 (In millions)
2023$225 $36 
2024133 36 
202598 36 
202683 31 
202745 22 
Remaining years185 122 
Total lease payments (a)769 283 
Less: Imputed interest(100)(83)
Total lease obligations$669 $200 
(a)Excludes lease payments of $153 million under an agreement to lease a deepwater drilling rig to be used in the Gulf of Mexico. The agreement was executed prior to December 31, 2022, but lease commencement will not occur until 2023.
The following information relates to the operating and finance leases at December 31:
 Operating LeasesFinance Leases
2022202120222021
Weighted average remaining lease term6.8 years9.9 years10.8 years11.8 years
Range of remaining lease terms
0.3 - 13.5 years
0.1 - 14.5 years
10.8 years11.8 years
Weighted average discount rate4.5%4.1%7.9%7.9%
The components of lease costs were as follows:
202220212020
(In millions)
Operating lease cost$114 $88 $200 
Finance lease cost:
Amortization of leased assets18 24 31 
Interest on lease obligations18 18 20 
Short-term lease cost (a)311 137 199 
Variable lease cost (b)33 21 38 
Sublease income (c)(18)(17)(15)
Total lease cost$476 $271 $473 
(a)Short-term lease cost is primarily attributable to equipment used in global exploration, development, production, and crude oil marketing activities.  Future short-term lease costs will vary based on activity levels of our operated assets. In 2022, short-term lease cost included drilling rigs and offshore support vessels used for an exploration well and abandonment activity in the Gulf of Mexico and workover rigs for maintenance activities in the Bakken.
(b)Variable lease costs for drilling rigs result from differences in the minimum rate and the actual usage of the ROU asset during the lease period.  Variable lease costs for logistical assets result from differences in stated monthly rates and total charges reflecting the actual usage of the ROU asset during the lease period.  Variable lease costs for our office leases represent common area maintenance charges which have not been separated from lease components.
(c)We sublease certain of our office space to third parties under our head lease.
The above lease costs represent 100% of the lease payments due for the period, including where we as operator have contracted directly with suppliers.  As the payments under lease agreements where we are operator become due, we bill our partners their proportionate share for reimbursement pursuant to the terms of our joint operating agreements.  Reimbursements are not reflected in the table above.  Certain lease costs above associated with exploration and development activities are included in capital expenditures.
Supplemental cash flow information related to leases were as follows:
Operating LeasesFinance Leases
202220212020202220212020
(In millions)
Cash paid for amounts included in the measurement of lease obligations:
Operating cash flows (a)$126 $87 $218 $18 $18 $20 
Financing cash flows (a)— — — 19 18 17 
Noncash transactions:
Leased assets recognized for new lease obligations incurred (b)294 12 51 — — — 
Changes in leased assets and lease obligations due to lease modifications (c)16 29 123 — — — 
(a)Amounts represent gross lease payments before any recovery from partners.
(b)In 2022, primarily related to new leases for drilling rigs in the Bakken and in North Malay Basin.
(c)In 2020, primarily related to negotiated extensions of an office lease and offshore drilling rig leases.
Leases
6.  Leases
Operating and finance lease obligations at December 31 included in the Consolidated Balance Sheet were as follows:
Operating LeasesFinance Leases
2022202120222021
(In millions)
Right-of-use assets — net (a)$570 $352 $126 $144 
Lease obligations:
Current$200 $70 $21 $19 
Long-term469 394 179 200 
Total lease obligations$669 $464 $200 $219 
(a)At December 31, 2022, finance lease ROU assets had a cost of $212 million (2021: $212 million) and accumulated amortization of $86 million (2021: $68 million).
Lease obligations represent 100% of the present value of future minimum lease payments in the lease arrangement.  Where we have contracted directly with a lessor in our role as operator of an unincorporated oil and gas venture, we bill our partners their proportionate share for reimbursements as payments under lease agreements become due pursuant to the terms of our joint operating and other agreements.
The nature of our leasing arrangements at December 31, 2022 was as follows:
Operating leases:  In the normal course of business, we primarily lease drilling rigs, equipment, logistical assets (offshore vessels, aircraft, and shorebases), and office space.
Finance leases:  In 2018, we entered into a sale and lease-back arrangement for a floating storage and offloading vessel (FSO) to handle produced condensate at North Malay Basin, offshore Peninsular Malaysia.  At December 31, 2022, the remaining lease term for the FSO was 10.8 years.
Maturities of lease obligations at December 31, 2022 were as follows:
 Operating LeasesFinance
Leases
 (In millions)
2023$225 $36 
2024133 36 
202598 36 
202683 31 
202745 22 
Remaining years185 122 
Total lease payments (a)769 283 
Less: Imputed interest(100)(83)
Total lease obligations$669 $200 
(a)Excludes lease payments of $153 million under an agreement to lease a deepwater drilling rig to be used in the Gulf of Mexico. The agreement was executed prior to December 31, 2022, but lease commencement will not occur until 2023.
The following information relates to the operating and finance leases at December 31:
 Operating LeasesFinance Leases
2022202120222021
Weighted average remaining lease term6.8 years9.9 years10.8 years11.8 years
Range of remaining lease terms
0.3 - 13.5 years
0.1 - 14.5 years
10.8 years11.8 years
Weighted average discount rate4.5%4.1%7.9%7.9%
The components of lease costs were as follows:
202220212020
(In millions)
Operating lease cost$114 $88 $200 
Finance lease cost:
Amortization of leased assets18 24 31 
Interest on lease obligations18 18 20 
Short-term lease cost (a)311 137 199 
Variable lease cost (b)33 21 38 
Sublease income (c)(18)(17)(15)
Total lease cost$476 $271 $473 
(a)Short-term lease cost is primarily attributable to equipment used in global exploration, development, production, and crude oil marketing activities.  Future short-term lease costs will vary based on activity levels of our operated assets. In 2022, short-term lease cost included drilling rigs and offshore support vessels used for an exploration well and abandonment activity in the Gulf of Mexico and workover rigs for maintenance activities in the Bakken.
(b)Variable lease costs for drilling rigs result from differences in the minimum rate and the actual usage of the ROU asset during the lease period.  Variable lease costs for logistical assets result from differences in stated monthly rates and total charges reflecting the actual usage of the ROU asset during the lease period.  Variable lease costs for our office leases represent common area maintenance charges which have not been separated from lease components.
(c)We sublease certain of our office space to third parties under our head lease.
The above lease costs represent 100% of the lease payments due for the period, including where we as operator have contracted directly with suppliers.  As the payments under lease agreements where we are operator become due, we bill our partners their proportionate share for reimbursement pursuant to the terms of our joint operating agreements.  Reimbursements are not reflected in the table above.  Certain lease costs above associated with exploration and development activities are included in capital expenditures.
Supplemental cash flow information related to leases were as follows:
Operating LeasesFinance Leases
202220212020202220212020
(In millions)
Cash paid for amounts included in the measurement of lease obligations:
Operating cash flows (a)$126 $87 $218 $18 $18 $20 
Financing cash flows (a)— — — 19 18 17 
Noncash transactions:
Leased assets recognized for new lease obligations incurred (b)294 12 51 — — — 
Changes in leased assets and lease obligations due to lease modifications (c)16 29 123 — — — 
(a)Amounts represent gross lease payments before any recovery from partners.
(b)In 2022, primarily related to new leases for drilling rigs in the Bakken and in North Malay Basin.
(c)In 2020, primarily related to negotiated extensions of an office lease and offshore drilling rig leases.