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Capitalized Exploratory Well Costs and Undeveloped Leasehold Costs
6 Months Ended
Jun. 30, 2016
Capitalized Exploratory Well Costs [Abstract]  
Capitalized Exploratory Well Costs and Undeveloped Leasehold Costs
Capitalized Exploratory Well Costs and Undeveloped Leasehold
Capitalized Exploratory Well Costs We capitalize exploratory well costs until a determination is made that the well has found proved reserves or is deemed noncommercial. On a quarterly basis, we review the status of suspended exploratory well costs and assess the development of these projects. If a well is deemed to be noncommercial, the well costs are charged to exploration expense as dry hole cost.
Changes in capitalized exploratory well costs are as follows and exclude amounts that were capitalized and subsequently expensed in the same period:
(millions)
Six Months Ended June 30, 2016
Capitalized Exploratory Well Costs, Beginning of Period
$
1,353

Additions to Capitalized Exploratory Well Costs Pending Determination of Proved Reserves
68

Divestitures (1)
(143
)
Reclassified to Proved Oil and Gas Properties Based on Determination of Proved Reserves
(4
)
Capitalized Exploratory Well Costs Charged to Expense (2)
(82
)
Capitalized Exploratory Well Costs, End of Period
$
1,192


(1) 
Represents our farm-out of a 35% interest in Block 12 offshore Cyprus to a new partner.
(2) 
Includes amounts related to contract termination offshore Falkland Islands, Dolphin 1 exploratory well offshore Israel, and Silvergate exploratory well deepwater Gulf of Mexico.

The following table provides an aging of capitalized exploratory well costs based on the date that drilling commenced, and the number of projects that have been capitalized for a period greater than one year: 
(millions)
June 30,
2016
 
December 31,
2015
Exploratory Well Costs Capitalized for a Period of One Year or Less
$
86

 
$
95

Exploratory Well Costs Capitalized for a Period Greater Than One Year Since Commencement of Drilling
1,106

 
1,258

Balance at End of Period
$
1,192

 
$
1,353

Number of Projects with Exploratory Well Costs That Have Been Capitalized for a Period Greater Than One Year Since Commencement of Drilling
13

 
14


 
The following table includes exploratory well costs that have been capitalized for a period greater than one year since the commencement of drilling as of June 30, 2016:
 
 
 
 
(millions)
Total by Project
 
Progress
Country/Project:
 
 
 
Deepwater Gulf of Mexico
 
 
 
Troubadour
$
51

 
Evaluating development scenarios for this 2013 natural gas discovery including subsea tieback to existing infrastructure.
Katmai
95

 
Evaluating development scenarios for this 2014 crude oil discovery. In second quarter 2016, drilling operations at the Katmai 2 appraisal well, located in Green Canyon 39, were temporarily abandoned as a result of encountering high pressure in the untested fault block. Plans to complete appraisal of the discovery at a future date are being developed.
Offshore Equatorial Guinea (Blocks I and O)
 

 
 
Diega (Block I) and Carmen (Block O)
237

 
Evaluating regional development scenarios for this 2008 crude oil discovery. We drilled subsequent appraisal wells. During 2014, we conducted additional seismic activity over Blocks I and O and are interpreting and evaluating the acquired seismic data.
Carla (Block O)
182

 
Evaluating regional development scenarios for this 2011 crude oil discovery. We drilled subsequent appraisal wells. During 2014, we conducted additional seismic activity over Blocks I and O and are interpreting and evaluating the acquired seismic data.
Yolanda/Felicita
66

 
Evaluating regional development plans for these 2007/2008 condensate and natural gas discoveries. A natural gas development team is working with the governments of Equatorial Guinea and Cameroon to evaluate natural gas monetization options and finalize a data exchange agreement between the two countries.
Offshore Cameroon
 

 
 
YoYo
52

 
Evaluating regional development plans for this 2007 condensate and natural gas discovery. A natural gas development team is working with the governments of Cameroon and Equatorial Guinea to evaluate natural gas monetization options and finalize a data exchange agreement between the two countries. Our 50% working interest partner has given notice to us and the Cameroon government of their intention to exit this acreage position. Once the assignment process is finalized, we will hold 100% operating working interest. We are marketing this additional 50% working interest.
Offshore Israel
 

 
 
Leviathan
194

 
Our development plan was approved by the Government and we are engaged in natural gas marketing activities to meet both Israeli domestic and regional export demands.
Leviathan-1 Deep
83

 
The well did not reach the target interval. We are developing future drilling plans to test this deep oil concept, which is held by the Leviathan Development and Production Leases.
Dalit
31

 
Our development plan was approved by the Government of Israel to develop this 2009 natural gas discovery with a tie-in to existing infrastructure at Tamar.
Offshore Cyprus
 
 
 
Cyprus
87

 
During first quarter 2016, we received proceeds of $131 million from our 35% farm-down of interest with a partner in Block 12. In second quarter 2016, we submitted an updated development plan and continue to work with the Government of Cyprus to obtain approval of the development plan and the subsequent issuance of an Exploitation License. Receiving an Exploitation License will allow us and our partners to perform the necessary engineering and design studies and progress the project to final investment decision.
Other
 

 
 
Individual Projects Less than $20 million
28

 
Continuing to assess and evaluate wells.
Total
$
1,106

 
 

Undeveloped Leasehold Costs As of June 30, 2016, we had capitalized undeveloped leasehold costs of $2.1 billion, of which approximately $1.9 billion relates to our core operating areas onshore US and is included in our proved property impairment testing for these areas. In addition, we have capitalized undeveloped leasehold of $57 million relating to international operations, and $195 million relating to deepwater Gulf of Mexico.
Significant undeveloped leases are individually assessed for impairment. While none of our significant undeveloped leases were impaired as of June 30, 2016, if, based upon a change in exploration plans, availability of capital and suitable rig and drilling equipment, resource potential, changing regulations and/or other factors, an impairment is indicated, a valuation allowance will be provided. Costs of individually insignificant leases are combined and amortized over their lease term. Expense associated with either impairment or amortization of undeveloped leases is included in exploration expense in our consolidated statement of operations.