INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2018

Income Tax Disclosure [Abstract]

Income (Loss) Before Income Taxes

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

	For the Year Ended December 31,
	2018			2017			2016
	(In millions)
U.S.	$	(723	)	$	(3,620	)	$	(997	)
Foreign	1,681			4,538			(685		)
Total	$	958		$	918		$	(1,682	)

Total Provision for Income Taxes

The total income tax provision (benefit) from continuing operations consists of the following:

	For the Year Ended December 31,
	2018			2017			2016
	(In millions)
Current income taxes:
Federal	$	(1	)	$	(38	)	$	(14	)
State	—			(8		)	(30		)
Foreign	895			641			435
	894			595			391
Deferred income taxes:
Federal	(65		)	(1,010		)	(257		)
State	2			—			—
Foreign	(159		)	(170		)	(576		)
	(222		)	(1,180		)	(833		)
Total	$	672		$	(585	)	$	(442	)

Reconciliation of Tax of Income Before Income Taxes and Total Tax Expense

A reconciliation of the tax on the Company’s income (loss) from continuing operations before income taxes and total tax expense is shown below:

	For the Year Ended December 31,
	2018			2017			2016
	(In millions)
Income tax expense (benefit) at U.S. statutory rate	$	201		$	321		$	(589	)
State income tax, less federal effect(1)	2			(6		)	(19		)
Taxes related to foreign operations	436			(105		)	303
Tax credits	(13		)	(33		)	(1		)
Tax on distributed foreign earnings	—			—			80
Tax on deemed repatriation of foreign earnings	103			419			—
Foreign tax credits	(336		)	(201		)	(136		)
Deferred tax on undistributed foreign earnings	—			(1,872		)	(31		)
Change in U.K. tax rate	—			—			(238		)
Change in U.S. tax rate	161			516			—
Net change in tax contingencies	(2		)	(1		)	(19		)
Canadian USD functional currency election	—			—			158
Sale of Canadian assets	—			279			—
Sale of North Sea assets	(30		)	(48		)	—
Valuation allowances(1)	118			161			10
All other, net	32			(15		)	40
	$	672		$	(585	)	$	(442	)

(1) The change in state valuation allowance is included as a component of state income tax.

Net Deferred Tax Liability

The net deferred income tax liability consists of the following:

	December 31,
	2018			2017
	(In millions)
Deferred tax assets:
Deferred income	$	—		$	13
U.S. and state net operating losses	1,633			1,230
Capital losses	636			620
Foreign net operating losses	—			6
Tax credits and other tax incentives	39			28
Foreign tax credits	2,241			2,427
Accrued expenses and liabilities	117			110
Asset retirement obligation	649			629
Equity investments	4			—
Net interest expense limitation	65			—
Other	97			42
Total deferred tax assets	5,481			5,105
Valuation allowance	(3,947		)	(3,816		)
Net deferred tax assets	1,534			1,289
Deferred tax liabilities:
Deferred income	10			—
Equity investments	—			18
Investment in Altus Midstream LP	73			—
Property and equipment	1,747			1,798
Other	4			—
Total deferred tax liabilities	1,834			1,816
Net deferred income tax liability	$	300		$	527

Net deferred tax assets and liabilities are included in the consolidated balance sheet as follows:

	December 31,
	2018		2017
	(In millions)
Assets:
Deferred charges and other	$	91	$	18
Liabilities:
Deferred income taxes	391		545
Net deferred income tax liability	$	300	$	527

Summary of Valuation Allowance Against Certain Foreign Net Deferred Tax Assets and State Net Operating Losses

In 2018, 2017, and 2016, the Company’s valuation allowance increased by $131 million, decreased by $1.6 billion, and decreased by $33 million, respectively, as detailed in the table below:

	2018			2017			2016
	(In millions)
Balance at beginning of year	$	3,816		$	5,401		$	5,434
State(1)	15			139			(43		)
U.S.	124			905			139
Foreign(2)	(8		)	(2,629		)	(129		)
Balance at end of year	$	3,947		$	3,816		$	5,401

(1) Reported as a component of state income taxes.

(2) In 2017, the Company completed the sale of its Canadian assets. As such, except for capital losses incurred on the sale, the deferred tax assets, liabilities, and valuation allowance related to these assets were removed for 2017.

Net Operating Losses

On December 31, 2018, the Company had net operating losses as follows:

	Amount		Expiration
	(In millions)
Net operating losses:
U.S.	$	5,888	2018 - Indefinite
State	5,664		Various

Schedule of Foreign Tax Credit Carryforward

On December 31, 2018, the Company had foreign tax credits as follows:

	Amount		Expiration
	(In millions)
Foreign tax credits	$	2,241	2025-2026

Reconciliation of Beginning and Ending Amount of Unrecognized Tax Benefits

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:

	2018			2017			2016
	(In millions)
Balance at beginning of year	$	26		$	15		$	19
Additions based on tax positions related to the current year	—			12			15
Reductions for tax positions of prior years	(2		)	(1		)	(19		)
Balance at end of year	$	24		$	26		$	15

Key Jurisdictions of Company's Earliest Open Tax Years

U.S.	2014
Egypt	2005
U.K.	2017