Benefit Plans (Tables)

12 Months Ended

Dec. 31, 2011

Schedule of Defined Benefit Plans Disclosures

Changes in the benefit obligation and plan assets of the pension, restoration and other postretirement benefit plans were as follows at December 31:

	Retirement and Restoration Plans						Medical and Life Plans
	2011			2010			2011			2010
(millions)
Change in Benefit Obligation
Benefit Obligation, Beginning Balance	$	262		$	228		$	24		$	23
Service Cost		14			14			2			2
Interest Cost		13			13			1			1
Employee Contributions		-			-			1			1
Benefits Paid		(13	)		(12	)		(2	)		(1	)
Plan Amendments (1)		-			-			(6	)		-
Actuarial Net (Gains) Losses		17			19			(2	)		(2	)
Benefit Obligation, Ending Balance		293			262			18			24
Change in Plan Assets
Fair Value of Plan Assets, Beginning Balance		206			172			-			-
Actual Return on Plan Assets		(1	)		23			-			-
Employer/Employee Contributions		27			23			2			1
Benefits Paid		(13	)		(12	)		(2	)		(1	)
Fair Value of Plan Assets, Ending Balance		219			206			-			-
Funded Status of Plan
Funded Status at End of Year		(74	)		(56	)		(18	)		(24	)
Net Amount Recognized in Consolidated Balance Sheets		(74	)		(56	)		(18	)		(24	)
Amounts Recognized in Consolidated Balance Sheets Consist of
Current Liabilities		(3	)		(3	)		(1	)		(1	)
Noncurrent Liabilities		(71	)		(53	)		(17	)		(23	)
Net Amount Recognized in Consolidated Balance Sheets		(74	)		(56	)		(18	)		(24	)
Amounts Not Yet Reflected in Net Periodic Benefit Cost and Included in AOCL
Net Prior Service (Cost) Credit, Before Tax		(2	)		(3	)		10			6
Net Gains (Losses), Before Tax		(120	)		(93	)		(6	)		(9	)
AOCL		(122	)		(96	)		4			(3	)
Cumulative Employer Contributions in Excess of Net Periodic Benefit Cost		48			40			(22	)		(21	)
Net Amount Recognized in Consolidated Balance Sheets	$	(74	)	$	(56	)	$	(18	)	$	(24	)

(1)	Plan amendments relate to an increase in the monthly retiree contributions, changes to annual deductible, co-pays and annual out-of-pocket limit and change to reflect trend on retiree contributions for the medical and life plan.

Net periodic benefit cost recognized for the pension, restoration and other postretirement benefit plans was as follows:

	Retirement and Restoration Plans									Medical and Life Plans
	Year Ended December 31,									Year Ended December 31,
	2011			2010			2009			2011			2010			2009
(millions)
Components of Net Periodic Benefit Cost
Service Cost	$	14		$	14		$	12		$	2		$	2		$	2
Interest Cost		13			13			11			1			1			1
Expected Return on Plan Assets		(15	)		(14	)		(14	)		-			-			-
Amortization of Prior Service (Credit) Cost		-			-			-			(1	)		(1	)		(1	)
Amortization of Net Loss and Other		6			5			3			1			1			1
Net Periodic Benefit Cost	$	18		$	18		$	12		$	3		$	3		$	3
Other Changes Recognized in AOCL
Prior Service Cost Arising During Period	$	-		$	-		$	-		$	(6	)	$	-		$	(2	)
Net Loss (Gain) Arising During Period		33			10			5			(2	)		(2	)		1
Amortization of Prior Service Credit		-			-			-			1			1			1
Amortization of Net Loss		(6	)		(5	)		(3	)		(1	)		(1	)		(1	)
Total Recognized in AOCL	$	27		$	5		$	2		$	(8	)	$	(2	)	$	(1	)
Expected Amortizations for Next Fiscal Year
Amortization of Net Prior Service Cost (Credit)	$	-		$	-		$	-		$	(2	)	$	(1	)	$	(1	)
Amortization of Net Losses		11			6			5			-			-			1
Weighted-Average Assumptions Used to Determine Benefit Obligations
Discount Rate (1)		4.25	%		5.50% / 5.25	%		6.00	%		4.00	%		5.00	%		5.50	%
Rate of Compensation Increase (2)		4.00% - 13.00	%		5.00	%		5.00	%		-			-			-
Weighted-Average Assumptions Used to Determine Net Periodic Benefit Costs
Discount Rate (3)		5.50% / 5.25	%		6.00	%		6.00% / 6.25	%		5.00	%		5.50	%		6.25	%
Expected Long-Term Return on Assets		7.25	%		7.50	%		8.00	%		-			-			-
Rate of Compensation Increase		5.00	%		5.00	%		5.00	%		-			-			-

(1)	The discount rates used to determine benefit obligations at December 31, 2010 were 5.50% for the retirement plan and 5.25% for the restoration plan.

(2)	The rate of compensation increase used to determine benefit obligations at December 31, 2011 ranged from 4% to 13%. The rate of compensation increase assumption was determined using a historical age based table grouped in five year age intervals.

(3)

The discount rates used to determine net periodic benefit costs for the year ended December 31, 2011 were 5.50% for the retirement plan and 5.25% for the restoration plan. The discount rates used to determine net periodic benefit costs for the year ended December 31, 2009 were 6.00% for the retirement plan and 6.25% for the restoration plan.

Additional disclosures for the retirement and restoration plans are as follows:

	December 31,
	2011		2010
(millions)
Accumulated Benefit Obligation	$	267	$	230

Information for Pension Plans With Projected Benefit Obligations in Excess of Plan Assets
Projected Benefit Obligation		293		262
Fair Value of Plan Assets		219		206
Information for Pension Plans With Accumulated Benefit Obligations in Excess of Plan Assets
Accumulated Benefit Obligation		267		37
Fair Value of Plan Assets		219		-

In selecting the assumption for expected long-term rate of return on assets, we consider the average rate of earnings expected on the funds to be invested to provide for plan benefits. This includes considering the plan's asset allocation, historical returns on these types of assets, the current economic environment and the expected returns likely to be earned over the life of the plan. During 2011, we changed the plan's target asset allocation from 70% equity and 30% fixed income to 60% equity and 40% fixed income. The change was made to more closely align the plan's expected future payment streams with the expected duration of plan liabilities. The change was also made to reduce the plan's market risk and the degree of volatility in the plan's investments. Because a larger portion of the plans funds are now invested in fixed income, which are considered to be less risky investments, the plan's returns will likely be reduced in times of market upswings, while losses will be reduced in times of market downswings. We assume the long-term asset mix will be consistent with the target asset allocation, with a range in the acceptable degree of variation in the plan's asset allocation of plus or minus 10%. Based on these factors we assumed an average of 7.25% per annum over the life of the plan for the calculation of 2011 net periodic benefit cost. The assumption will be reduced to 6.50% for the calculation of 2012 net periodic benefit cost. No plan assets are expected to be returned to us in 2012.

In order to determine an appropriate discount rate at December 31, 2011, we performed an analysis of the Citigroup Pension Discount Curve (the CPDC) and various AA corporate bond yields as of that date for each of our plans. The CPDC uses spot rates that represent the equivalent yield on high quality, zero-coupon bonds for specific maturities. We used these rates to develop an equivalent single discount rate based on our plans' expected future benefit payment streams and duration of plan liabilities. A 1% increase in the discount rate would have resulted in a decrease in net periodic benefit cost of approximately $3 million in 2011. A 1% decrease in the discount rate would have resulted in an increase in net periodic benefit cost of approximately $2 million in 2011.

Assumed health care cost trend rates were as follows:

	December 31,
	2011			2010
Health Care Cost Trend Rate Assumed for Next Year		7.65	%		7.83	%
Ultimate Health Care Cost Trend Rate		4.50	%		4.50	%
Year Rate Reaches Ultimate Trend Rate		2030			2030

Assumed health care cost trend rates have a significant effect on the amounts reported for health care plans. A one-percentage-point change in assumed health care cost trend rates would have the following effects:

	1% Increase		1% Decrease
(millions)
Effect on Total Service and Interest Cost Components for 2011	$	-	$	-
Effect on Year-End 2011 Postretirement Benefit Obligation		2		(1	)

Weighted-average asset allocations for the tax-qualified defined benefit pension plan are as follows:

	Target Allocation			Plan Assets
	2012			2011			2010
Asset Category
Equity Securities		60	%		65	%		73	%
Fixed Income		40	%		35	%		27	%
Total		100	%		100	%		100	%

Defined Benefit Plan Balance Sheet and Trend Rate Disclosures

Additional fair value disclosures about plan assets are as follows:

	Fair Value Measurements Using
Asset Category	Quoted Prices in Active Markets for Identical Assets (Level 1) (1)		Significant Observable Inputs (Level 2) (1)		Significant Unobservable Inputs (Level 3) (1)		Total
(millions)
December 31, 2011
Federal Money Market Funds	$	1	$	-	$	-	$	1
Mutual Funds
Large Cap Funds		66		-		-		66
Mid Cap Funds		10		-		-		10
Blended Funds		6		-		-		6
Emerging Markets Funds		6		-		-		6
Fixed Income Funds		77		-		-		77
Common Collective Trust Funds
Large Cap Funds		-		17		-		17
Small Cap Funds		-		12		-		12
International Funds		-		24		-		24
Total	$	166	$	53	$	-	$	219
December 31, 2010
Federal Money Market Funds	$	2	$	-	$	-	$	2
Mutual Funds
Large Cap Funds		69		-		-		69
Mid Cap Funds		10		-		-		10
Blended Funds		6		-		-		6
Emerging Markets Funds		7		-		-		7
Fixed Income Funds		55		-		-		55
Common Collective Trust Funds
Large Cap Funds		-		16		-		16
Small Cap Funds		-		12		-		12
International Funds		-		29		-		29
Total	$	149	$	57	$	-	$	206

(1)	See Note 1. Summary of Significant Accounting Policies - Fair Value Measurements for a description of the fair value hierarchy.

Components of the rabbi trust

Estimated Future Benefit Payments As of December 31, 2011, the following future benefit payments are expected to be paid:

	Retirement and Restoration Plans		Medical and Life Plans
(millions)
2012	$	21	$	1
2013		23		1
2014		25		1
2015		24		2
2016		26		2
Years 2017 to 2020		141		11

The estimate of expected future benefit payments is based on the same assumptions used to measure the benefit obligation at December 31, 2011 and includes estimated future employee service.

401(k) Plan We sponsor a 401(k) savings plan. All regular employees are eligible to participate. We make contributions to match employee contributions up to the first 6% of compensation deferred into the plan, and certain profit sharing contributions for employees hired on or after May 1, 2006, based upon their ages and salaries. We made cash contributions of $14 million in 2011, $11 million in 2010, and $9 million in 2009.

Deferred Compensation Plans We have a non-qualified deferred compensation plan for which participant-directed investments are held in a rabbi trust and are available to satisfy the claims of our creditors in the event of bankruptcy or insolvency. Participants may elect to receive distributions in either cash or shares of our common stock. Components of the rabbi trust are as follows:

	December 31,
	2011		2010
(millions, except share amounts)
Rabbi Trust Assets
Mutual Fund Investments	$	82	$	96
Noble Energy Common Stock (at Fair Value)		80		82
Total Rabbi Trust Assets		162		178
Liability Under Related Deferred Compensation Plan	$	162	$	178
Number of Shares of Noble Energy Common Stock Held by Rabbi Trust		848,940		949,040