Impairments

12 Months Ended

Dec. 31, 2019

Goodwill and Intangible Assets Disclosure [Abstract]

Impairments

Note 10. Impairments

2019 Impairments In fourth quarter 2019, we determined that the continued depressed commodity price environment and performance of certain of our US onshore basins indicated possible impairment of our proved oil and gas properties in our US onshore business. Following our impairment analysis, we recorded impairment expense of $1.2 billion to our Eagle Ford Shale proved properties, primarily as a result of significant decreases in NGL and natural gas prices, partially offset by lower capital and operating costs. The fair value of approximately $600 million was estimated using the income approach, utilizing a discounted cash flow model. The cash flow model included management's estimates of future production, commodity prices based on published forward commodity price curves, operating and development costs, and a risk-adjusted discount rate. As of December 31, 2019, we had $100 million of undeveloped leasehold costs related to our Eagle Ford Shale unproved properties that were not impaired and for which we believe future development scenarios exist to recover these costs.

2018 Impairments In 2018, upon classification of the Gulf of Mexico properties as assets held for sale, we recognized impairment expense of $168 million. Additionally, in fourth quarter 2018, we recorded impairment expense of $38 million, $37 million of which related to changes in construction plans for certain midstream assets.

In fourth quarter 2018, we considered changes to facts and circumstances, particularly the decline in WTI strip pricing, increases in operating and capital costs, as well as our development plans, and concluded that it was more likely than not that the fair value of our Texas reporting unit was less than its carrying amount. As a result, we recognized a goodwill impairment of $1.3 billion.

2017 Impairments In 2017, we recorded impairment expense of $70 million primarily related to our decision not to pursue development of the Troubadour natural gas discovery in the Gulf of Mexico.