Note 2. Additional Financial Statement Information

Additional statements of operations information is as follows:

	Year Ended December 31,
	2011			2010			2009
(millions)
Other Revenues
Electricity Sales (1)	$	32		$	73		$	72
Refund of Deepwater Gulf of Mexico Royalties (2)		-			-			86
Other		-			(1	)		11
Total	$	32		$	72		$	169
Production Expense
Lease Operating Expense	$	397		$	376		$	372
Production and Ad Valorem Taxes		146			125			94
Transportation Expense		75			69			59
Total	$	618		$	570		$	525
Other Operating Expense, Net
Deepwater Gulf of Mexico Moratorium Expense (3)	$	18		$	27		$	-
Electricity Generation Expense (1)		26			39			18
Write-down of SemCrude L.P. Receivable (4)		-			-			12
Loss on Involuntary Conversion (5)		4			-			-
Other, Net		38			(2	)		37
Total	$	86		$	64		$	67
Other Non-Operating (Income) Expense, Net
Deferred Compensation Expense (6)	$	8		$	15		$	23
Interest Income (7)		(8	)		(7	)		(13	)
Other (Income) Expense, Net		2			(2	)		2
Total	$	2		$	6		$	12

(1)

Amount represents electricity sales from the Machala power plant located in Machala, Ecuador. Electricity generation expense includes all operating and non-operating expenses associated with the plant, including DD&A and changes in the allowance for doubtful accounts. See Note 3. Acquisitions and Divestitures, Note 4. Asset Impairments, and Note 5. Allowance for Doubtful Accounts.

(2)	The refund was attributable to royalties that we previously paid on crude oil and natural gas produced in the deepwater Gulf of Mexico from January 1, 2003 through July 31, 2009.

(3)	Amounts relate to rig stand-by expense incurred prior to receiving a permit to resume drilling activities in the deepwater Gulf of Mexico in 2011 and costs to terminate a deepwater Gulf of Mexico drilling rig contract due to the deepwater Gulf of Mexico drilling moratorium in 2010.

(4)	See Note 5. Allowance for Doubtful Accounts.

(5)

The loss on involuntary conversion represents our insurance deductible related to the Leviathan-2 appraisal well control incident. We suspended operations on the Leviathan-2 well, offshore Israel, in May 2011 when we identified water flowing to the sea floor from the wellbore. The incident was a covered event under our well control insurance. At this time, we expect to recover most of the costs from insurance, subject to a deductible. The final amount to be recovered will be based on the cost to drill the Leviathan-3 replacement well down to the same depth at which the incident occurred, possible remediation activities and/or abandonment activities at the Leviathan-2 well, which have not yet been determined, and other factors. See footnote (2) below.

(6)	Amount represents increases in the fair value of shares of our common stock held in a rabbi trust. See Note 14. Benefit Plans.

(7)	Interest income for 2010 and 2009 includes $3 million and $11 million, respectively, related to the refund of deepwater Gulf of Mexico royalties.

Additional balance sheet information is as follows:

	December 31,
	2011			2010
(millions)
Accounts Receivable, Net
Commodity Sales	$	356		$	291
Joint Interest Billings		313			259
Other		123			33
Allowance for Doubtful Accounts (1)		(9	)		(27	)
Total	$	783		$	556
Other Current Assets
Inventories, Current	$	78		$	112
Commodity Derivative Assets, Current		10			62
Deferred Income Taxes, Net, Current		41			9
Probable Insurance Claims (2)		15			-
Prepaid Expenses and Other Assets, Current		36			18
Total	$	180		$	201
Other Noncurrent Assets
Equity Method Investments (3)	$	329		$	285
Mutual Fund Investments		99			112
Commodity Derivative Assets, Noncurrent		37			-
Other Assets, Noncurrent		83			87
Total	$	548		$	484
Other Current Liabilities
Production and Ad Valorem Taxes	$	121		$	110
Commodity Derivative Liabilities, Current		76			24
Interest Rate Derivative Liability, Current		-			63
Income Taxes Payable		127			90
Asset Retirement Obligations, Current (4)		33			45
Interest Payable		56			36
CONSOL Installment Payment, Net (5)		324			-
Current Portion of FPSO Lease Obligation		45			-
Other Liabilities, Current		143			127
Total	$	925		$	495
Other Noncurrent Liabilities
Deferred Compensation Liabilities, Noncurrent	$	222		$	229
Asset Retirement Obligations, Noncurrent (4)		344			208
Accrued Benefit Costs, Noncurrent		88			76
Commodity Derivative Liabilities, Noncurrent		7			51
Other Liabilities, Noncurrent		91			66
Total	$	752		$	630

(1)	The decrease in the allowance for doubtful accounts from December 31, 2010 is due primarily to the transfer of assets to the Ecuadorian government. See Note 3. Acquisitions and Divestitures and Note 5. Allowance for Doubtful Accounts.

(2)	Amount represents the costs incurred to date, net of insurance deductible and cash receipts for the Leviathan-2 appraisal well. See footnote (5) above.

(3)	The increase in equity method investments from December 31, 2010 is due primarily to our acquisition of a 50% interest in CONE. See Note 3. Acquisitions and Divestitures.

(4)	See Note 11. Asset Retirement Obligations.

(5)	See Note 3. Acquisitions and Divestitures and Note 12. Long-Term Debt.

Supplemental statements of cash flow information is as follows:

	Year Ended December 31,
	2011		2010		2009
(millions)
Cash Paid During the Year For
Interest, Net of Amount Capitalized	$	32	$	66	$	52
Income Taxes Paid, Net		288		173		227
Non-Cash Financing and Investing Activities
Increase in CONSOL Installment Payments, Net of Discount (1)		639		-		-
Increase in FPSO Lease Obligation (1)		66		266		29

(1)	See Note 3. Acquisitions and Divestitures and Note 12. Long-Term Debt.