Income Taxes (Tables)

12 Months Ended

Dec. 31, 2011

Income Taxes [Abstract]

Components of Income Before Income Taxes Table

Components of income (loss) before income taxes are as follows:

	Year Ended December 31,
	2011			2010		2009
(millions)
Domestic	$	(537	)	$	235	$	(808	)
Foreign		1,252			796		544
Total	$	715		$	1,031	$	(264	)

Components of Income Tax Provision Table

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

	Year Ended December 31,
	2011			2010			2009
(millions)
Current Taxes
Federal	$	11		$	25		$	45
State		2			2			1
Foreign		330			208			117
Total Current		343			235			163
Deferred Taxes
Federal		(130	)		86			(320	)
State		(3	)		1			(5	)
Foreign		52			(16	)		29
Total Deferred		(81	)		71			(296	)
Total Income Tax Provision (Benefit)	$	262		$	306		$	(133	)
Effective Tax Rate		37	%		30	%		50	%

Tax Rate Reconciliation Table

A reconciliation of the federal statutory tax rate to the effective tax rate is as follows:

	Year Ended December 31,
	2011			2010			2009
(percentages)
Federal Statutory Rate		35.0			35.0			35.0
Effect of
Earnings of Equity Method Investees		(9.3	)		(4.0	)		11.3
State Taxes, Net of Federal Benefit		(0.1	)		0.3			1.5
Difference Between US and Foreign Rates		2.1			1.7			(1.4	)
Percentage Depletion in Excess of Basis		(0.6	)		(1.6	)		4.5
Change in Valuation Allowance		4.6			(2.2	)		1.5
Oil Profits Tax - Israel		2.5			-			-
Statutory Rate Change - UK		4.8			-			-
Other, Net		(2.4	)		0.5			(2.0	)
Effective Rate		36.6			29.7			50.4

Deferred Tax Assets and Liabilities

Deferred tax assets and liabilities resulted from the following:

	December 31,
	2011			2010
(millions)
Deferred Tax Assets
Loss Carryforwards	$	66		$	72
Ecuador Investment		-			12
Accrued Expenses		11			10
Allowance for Doubtful Accounts		-			5
Net Pension Obligation		42			35
Postretirement Benefits		36			35
Deferred Compensation		86			94
Foreign Tax Credits		57			25
Commodity Derivative Assets		37			38
Other		39			32
Total Deferred Tax Assets		374			358
Valuation Allowance - Foreign Loss Carryforwards		(65	)		(58	)
Valuation Allowance - Foreign Tax Credits		(57	)		-
Valuation Allowance - Ecuador Investment		-			(12	)
Net Deferred Tax Assets		252			288
Deferred Tax Liabilities
Property, Plant and Equipment, Principally Due to Differences in Depreciation, Amortization, Lease Impairment and Abandonments		(2,276	)		(2,389	)
Total Deferred Tax Liability		(2,276	)		(2,389	)
Net Deferred Tax Liability	$	(2,024	)	$	(2,101	)

Deferred Tax Liability Balance Sheet Classification

Net deferred tax liabilities were classified in the consolidated balance sheets as follows:

	December 31,
	2011			2010
(millions)
Deferred Income Tax Asset - Current	$	41		$	9
Deferred Income Tax Liability - Current		(6	)		-
Deferred Income Tax Liability - Noncurrent		(2,059	)		(2,110	)
Net Deferred Tax Liability	$	(2,024	)	$	(2,101	)