10. Income Taxes

The income tax provision (benefit) consists of the following:



	Three Months Ended September 30,						Nine Months Ended September 30,
(millions)	2017			2016			2017			2016
Current ⁽¹⁾	$	22		$	148		$	71		$	213
Deferred	(115		)	(285		)	(988		)	(699		)
Total Income Tax Benefit	$	(93	)	$	(137	)	$	(917	)	$	(486	)
Effective Tax Rate	44.7		%	48.9		%	36.9		%	39.5		%

⁽¹⁾Current income taxes are attributable to our operations in Israel and Equatorial Guinea.

Effective Tax Rate (ETR) At the end of each interim period, we apply a forecasted annualized effective tax rate (ETR) to current year earnings or loss before tax, which can result in significant interim ETR fluctuations. Our ETR for the three and nine months ended September 30, 2017 varied as compared with the three and nine months ended September 30, 2016 primarily due to a smaller prior year increase to the deferred tax liability recorded on unrepatriated earnings combined with a larger prior year discrete tax benefit driven by a tax rate change in a foreign jurisdiction.

In addition, the significant increase in the deferred income tax benefit for the nine months ended September 30, 2017 is primarily due to the loss recorded for the Marcellus Shale upstream divestiture during second quarter 2017.

In our major tax jurisdictions, the earliest years remaining open to examination are as follows: US – 2014, Israel – 2015 and Equatorial Guinea – 2012.

Deferred Tax Assets We currently forecast that our US federal income tax net operating loss (NOL) carryforwards will be substantial at year end 2017. Included in the resulting deferred tax assets are acquired deferred tax assets associated with net operating losses of the Clayton Williams Energy Acquisition in 2017 and with the Rosetta Resources Inc. acquisition in 2015.

In assessing the realizability of deferred tax assets, we consider whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income in the associated tax jurisdictions during the periods in which those temporary differences become deductible. We consider the scheduled reversal of deferred tax liabilities, current financial position, results of operations, projected future taxable income and tax planning strategies, as well as current and forecasted business economics in the oil and gas industry. Based on the level of our historical taxable income and projections for future taxable income, we currently believe it is more likely than not that we will realize the benefits of these NOL carryforwards. However, the amount of the deferred tax assets considered realizable could be reduced in the future if estimates of future taxable income during the carryforward period are reduced.

We currently have a valuation allowance on the deferred tax assets associated with foreign loss carryforwards forecasted for year end 2017 of approximately $181 million at September 30, 2017 and $242 million at December 31, 2016. The decrease was attributable to the offset of the valuation allowance against the net operating loss in a jurisdiction in which we are no longer active.