Delaware
|
|
71-0205415
|
||
(State or other jurisdiction of incorporation or organization)
|
|
(I.R.S. Employer Identification No.)
|
||
|
|
|
|
|
10000 Energy Drive
|
|
|
||
Spring,
|
|
Texas
|
|
77389
|
(Address of principal executive offices)
|
|
(Zip Code)
|
Title of each class
|
|
Trading Symbol(s)
|
|
Name of each exchange on which registered
|
Common Stock, Par Value $0.01
|
|
SWN
|
|
New York Stock Exchange
|
Large accelerated filer
|
☒
|
|
Accelerated filer
|
☐
|
|
Non-accelerated filer
|
☐
|
|
Smaller reporting company
|
☐
|
|
Emerging growth company
|
☐
|
Class
|
|
Outstanding as of August 2, 2019
|
Common Stock, Par Value $0.01
|
|
541,316,769
|
Page
|
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•
|
the timing and extent of changes in market conditions and prices for natural gas, oil and natural gas liquids (“NGLs”) (including regional basis differentials);
|
•
|
our ability to fund our planned capital investments;
|
•
|
a change in our credit rating; an increase in interest rates and any adverse impacts from the discontinuation of LIBOR;
|
•
|
the extent to which lower commodity prices impact our ability to service or refinance our existing debt;
|
•
|
the impact of volatility in the financial markets or other global economic factors;
|
•
|
difficulties in appropriately allocating capital and resources among our strategic opportunities;
|
•
|
the timing and extent of our success in discovering, developing, producing and estimating reserves;
|
•
|
our ability to maintain leases that may expire if production is not established or profitably maintained;
|
•
|
our ability to realize the expected benefits from acquisitions;
|
•
|
our ability to transport our production to the most favorable markets or at all;
|
•
|
availability and costs of personnel and of products and services provided by third parties;
|
•
|
the impact of government regulation, including changes in law, the ability to obtain and maintain permits, any increase in severance or similar taxes, and legislation or regulation relating to hydraulic fracturing, climate and over-the-counter derivatives;
|
•
|
the impact of the adverse outcome of any material litigation against us or judicial decisions that affect us or our industry generally;
|
•
|
the effects of weather;
|
•
|
increased competition;
|
•
|
the financial impact of accounting regulations and critical accounting policies;
|
•
|
the comparative cost of alternative fuels;
|
•
|
credit risk relating to the risk of loss as a result of non-performance by our counterparties; and
|
•
|
any other factors listed in the reports we have filed and may file with the Securities and Exchange Commission (“SEC”).
|
|
For the three months ended
June 30, |
|
For the six months ended June 30,
|
||||||||||||
(in millions, except share/per share amounts)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Operating Revenues:
|
|
|
|
|
|
|
|
||||||||
Gas sales
|
$
|
275
|
|
|
$
|
407
|
|
|
$
|
705
|
|
|
$
|
947
|
|
Oil sales
|
47
|
|
|
44
|
|
|
86
|
|
|
79
|
|
||||
NGL sales
|
58
|
|
|
75
|
|
|
139
|
|
|
140
|
|
||||
Marketing
|
287
|
|
|
265
|
|
|
725
|
|
|
518
|
|
||||
Gas gathering
|
—
|
|
|
24
|
|
|
—
|
|
|
48
|
|
||||
Other
|
—
|
|
|
1
|
|
|
2
|
|
|
4
|
|
||||
|
667
|
|
|
816
|
|
|
1,657
|
|
|
1,736
|
|
||||
Operating Costs and Expenses:
|
|
|
|
|
|
|
|
||||||||
Marketing purchases
|
293
|
|
|
265
|
|
|
734
|
|
|
520
|
|
||||
Operating expenses
|
169
|
|
|
193
|
|
|
334
|
|
|
382
|
|
||||
General and administrative expenses
|
40
|
|
|
59
|
|
|
77
|
|
|
114
|
|
||||
Loss on sale of operating assets
|
3
|
|
|
—
|
|
|
3
|
|
|
—
|
|
||||
Restructuring charges
|
2
|
|
|
18
|
|
|
5
|
|
|
18
|
|
||||
Depreciation, depletion and amortization
|
121
|
|
|
142
|
|
|
233
|
|
|
285
|
|
||||
Taxes, other than income taxes
|
17
|
|
|
15
|
|
|
36
|
|
|
38
|
|
||||
|
645
|
|
|
692
|
|
|
1,422
|
|
|
1,357
|
|
||||
Operating Income
|
22
|
|
|
124
|
|
|
235
|
|
|
379
|
|
||||
Interest Expense:
|
|
|
|
|
|
|
|
||||||||
Interest on debt
|
41
|
|
|
59
|
|
|
83
|
|
|
124
|
|
||||
Other interest charges
|
2
|
|
|
2
|
|
|
3
|
|
|
4
|
|
||||
Interest capitalized
|
(28
|
)
|
|
(29
|
)
|
|
(57
|
)
|
|
(57
|
)
|
||||
|
15
|
|
|
32
|
|
|
29
|
|
|
71
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Gain (Loss) on Derivatives
|
152
|
|
|
(36
|
)
|
|
120
|
|
|
(43
|
)
|
||||
Loss on Early Extinguishment of Debt
|
—
|
|
|
(8
|
)
|
|
—
|
|
|
(8
|
)
|
||||
Other Income (Loss), Net
|
(6
|
)
|
|
3
|
|
|
(5
|
)
|
|
2
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Income Before Income Taxes
|
153
|
|
|
51
|
|
|
321
|
|
|
259
|
|
||||
Provision (Benefit) for Income Taxes
|
|
|
|
|
|
|
|
||||||||
Current
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Deferred
|
15
|
|
|
—
|
|
|
(411
|
)
|
|
—
|
|
||||
|
15
|
|
|
—
|
|
|
(411
|
)
|
|
—
|
|
||||
Net Income
|
$
|
138
|
|
|
$
|
51
|
|
|
$
|
732
|
|
|
$
|
259
|
|
Participating securities - mandatory convertible preferred stock
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
||||
Net Income Attributable to Common Stock
|
$
|
138
|
|
|
$
|
51
|
|
|
$
|
732
|
|
|
$
|
257
|
|
|
|
|
|
|
|
|
|
||||||||
Earnings Per Common Share
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
0.26
|
|
|
$
|
0.09
|
|
|
$
|
1.36
|
|
|
$
|
0.45
|
|
Diluted
|
$
|
0.26
|
|
|
$
|
0.09
|
|
|
$
|
1.35
|
|
|
$
|
0.44
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted Average Common Shares Outstanding:
|
|
|
|
|
|
|
|
||||||||
Basic
|
539,005,941
|
|
|
581,159,200
|
|
|
539,362,984
|
|
|
576,255,744
|
|
||||
Diluted
|
539,947,053
|
|
|
582,878,106
|
|
|
540,624,742
|
|
|
578,222,740
|
|
|
For the three months ended
June 30, |
|
For the six months ended June 30,
|
||||||||||||
(in millions)
|
2019
|
|
2018 (1)
|
|
2019
|
|
2018 (1)
|
||||||||
Net income
|
$
|
138
|
|
|
$
|
51
|
|
|
$
|
732
|
|
|
$
|
259
|
|
|
|
|
|
|
|
|
|
||||||||
Change in value of pension and other postretirement liabilities:
|
|
|
|
|
|
|
|
||||||||
Amortization of prior service cost and net loss included in net periodic pension cost (2)
|
4
|
|
|
—
|
|
|
4
|
|
|
—
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Comprehensive income
|
$
|
142
|
|
|
$
|
51
|
|
|
$
|
736
|
|
|
$
|
259
|
|
(1)
|
In 2018, deferred tax activity incurred in other comprehensive income was offset by a valuation allowance.
|
(2)
|
Primarily related to settlement of pension assets in the second quarter of 2019. Net of $1 million in taxes for the three and six months ended June 30, 2019.
|
|
June 30, 2019
|
|
December 31, 2018
|
||||
ASSETS
|
(in millions)
|
||||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
155
|
|
|
$
|
201
|
|
Accounts receivable, net
|
358
|
|
|
581
|
|
||
Derivative assets
|
209
|
|
|
130
|
|
||
Other current assets
|
42
|
|
|
44
|
|
||
Total current assets
|
764
|
|
|
956
|
|
||
Natural gas and oil properties, using the full cost method, including $1,678 million as of June 30, 2019 and $1,755 million as of December 31, 2018 excluded from amortization
|
24,823
|
|
|
24,180
|
|
||
Other
|
555
|
|
|
525
|
|
||
Less: Accumulated depreciation, depletion and amortization
|
(20,279
|
)
|
|
(20,049
|
)
|
||
Total property and equipment, net
|
5,099
|
|
|
4,656
|
|
||
Deferred tax assets
|
410
|
|
|
—
|
|
||
Other long-term assets
|
272
|
|
|
185
|
|
||
TOTAL ASSETS
|
$
|
6,545
|
|
|
$
|
5,797
|
|
LIABILITIES AND EQUITY
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Current portion of long-term debt
|
$
|
52
|
|
|
$
|
—
|
|
Accounts payable
|
585
|
|
|
609
|
|
||
Taxes payable
|
52
|
|
|
58
|
|
||
Interest payable
|
53
|
|
|
52
|
|
||
Derivative liabilities
|
67
|
|
|
79
|
|
||
Other current liabilities
|
103
|
|
|
48
|
|
||
Total current liabilities
|
912
|
|
|
846
|
|
||
Long-term debt
|
2,267
|
|
|
2,318
|
|
||
Pension and other postretirement liabilities
|
39
|
|
|
46
|
|
||
Other long-term liabilities
|
245
|
|
|
225
|
|
||
Total long-term liabilities
|
2,551
|
|
|
2,589
|
|
||
|
|
|
|
|
|||
Equity:
|
|
|
|
||||
Common stock, $0.01 par value; 1,250,000,000 shares authorized; issued 585,478,345 shares as of June 30, 2019 and 585,407,107 shares as of December 31, 2018
|
6
|
|
|
6
|
|
||
Additional paid-in capital
|
4,720
|
|
|
4,715
|
|
||
Accumulated deficit
|
(1,410
|
)
|
|
(2,142
|
)
|
||
Accumulated other comprehensive loss
|
(32
|
)
|
|
(36
|
)
|
||
Common stock in treasury, 44,353,224 shares as of June 30, 2019 and 39,092,537 shares as of December 31, 2018
|
(202
|
)
|
|
(181
|
)
|
||
Total equity
|
3,082
|
|
|
2,362
|
|
||
TOTAL LIABILITIES AND EQUITY
|
$
|
6,545
|
|
|
$
|
5,797
|
|
|
For the six months ended June 30,
|
||||||
(in millions)
|
2019
|
|
2018
|
||||
Cash Flows From Operating Activities:
|
|
|
|
||||
Net income
|
$
|
732
|
|
|
$
|
259
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
||||
Depreciation, depletion and amortization
|
233
|
|
|
285
|
|
||
Amortization of debt issuance costs
|
2
|
|
|
4
|
|
||
Deferred income taxes
|
(411
|
)
|
|
—
|
|
||
(Gain) loss on derivatives, unsettled
|
(96
|
)
|
|
54
|
|
||
Stock-based compensation
|
4
|
|
|
9
|
|
||
Loss on early extinguishment of debt
|
—
|
|
|
8
|
|
||
Loss on sale of assets, net
|
3
|
|
|
—
|
|
||
Other
|
10
|
|
|
1
|
|
||
Change in assets and liabilities:
|
|
|
|
||||
Accounts receivable
|
221
|
|
|
12
|
|
||
Accounts payable
|
(129
|
)
|
|
53
|
|
||
Taxes payable
|
(6
|
)
|
|
(4
|
)
|
||
Interest payable
|
1
|
|
|
(1
|
)
|
||
Inventories
|
4
|
|
|
(7
|
)
|
||
Other assets and liabilities
|
(25
|
)
|
|
(9
|
)
|
||
Net cash provided by operating activities
|
543
|
|
|
664
|
|
||
|
|
|
|
||||
Cash Flows From Investing Activities:
|
|
|
|
||||
Capital investments
|
(586
|
)
|
|
(684
|
)
|
||
Proceeds from sale of property and equipment
|
26
|
|
|
6
|
|
||
Other
|
—
|
|
|
3
|
|
||
Net cash used in investing activities
|
(560
|
)
|
|
(675
|
)
|
||
|
|
|
|
||||
Cash Flows From Financing Activities:
|
|
|
|
||||
Payments on long-term debt
|
—
|
|
|
(1,191
|
)
|
||
Payments on revolving credit facility
|
—
|
|
|
(645
|
)
|
||
Borrowings under revolving credit facility
|
—
|
|
|
1,005
|
|
||
Change in bank drafts outstanding
|
(7
|
)
|
|
—
|
|
||
Debt issuance costs
|
—
|
|
|
(9
|
)
|
||
Purchase of treasury stock
|
(21
|
)
|
|
—
|
|
||
Preferred stock dividend
|
—
|
|
|
(27
|
)
|
||
Cash paid for tax withholding
|
(1
|
)
|
|
(1
|
)
|
||
Net cash used in financing activities
|
(29
|
)
|
|
(868
|
)
|
||
|
|
|
|
||||
Decrease in cash and cash equivalents
|
(46
|
)
|
|
(879
|
)
|
||
Cash and cash equivalents at beginning of year
|
201
|
|
|
916
|
|
||
Cash and cash equivalents at end of period
|
$
|
155
|
|
|
$
|
37
|
|
|
Common Stock
|
|
Additional
Paid-In Capital |
|
Accumulated
Deficit |
|
Accumulated Other
Comprehensive Income (Loss) |
|
Common Stock in Treasury
|
|
Total
|
||||||||||||||||||
|
Shares
Issued |
|
Amount
|
|
|
|
|
Shares
|
|
Amount
|
|
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
(in millions, except share amounts)
|
||||||||||||||||||||||||||||
Balance at December 31, 2018
|
585,407,107
|
|
|
$
|
6
|
|
|
$
|
4,715
|
|
|
$
|
(2,142
|
)
|
|
$
|
(36
|
)
|
|
39,092,537
|
|
|
$
|
(181
|
)
|
|
$
|
2,362
|
|
Comprehensive income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
594
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
594
|
|
||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Total comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
594
|
|
||||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3
|
|
||||||
Issuance of restricted stock
|
8,798
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Cancellation of restricted stock
|
(128,324
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Treasury stock
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,260,687
|
|
|
(21
|
)
|
|
(21
|
)
|
||||||
Performance units vested
|
535,802
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Tax withholding – stock compensation
|
(274,657
|
)
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
||||||
Balance at March 31, 2019
|
585,548,726
|
|
|
$
|
6
|
|
|
$
|
4,717
|
|
|
$
|
(1,548
|
)
|
|
$
|
(36
|
)
|
|
44,353,224
|
|
|
$
|
(202
|
)
|
|
$
|
2,937
|
|
Comprehensive income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
138
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
138
|
|
||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|
—
|
|
|
—
|
|
|
4
|
|
||||||
Total comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
142
|
|
||||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3
|
|
||||||
Issuance of restricted stock
|
6,424
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Cancellation of restricted stock
|
(72,555
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Tax withholding – stock compensation
|
(4,250
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Balance at June 30, 2019
|
585,478,345
|
|
|
$
|
6
|
|
|
$
|
4,720
|
|
|
$
|
(1,410
|
)
|
|
$
|
(32
|
)
|
|
44,353,224
|
|
|
$
|
(202
|
)
|
|
$
|
3,082
|
|
|
Common Stock
|
|
Preferred Stock
|
|
Additional
Paid-In Capital |
|
Accumulated
Deficit |
|
Accumulated Other
Comprehensive Income (Loss) |
|
Common Stock in Treasury
|
|
Total
|
|||||||||||||||||||
|
Shares
Issued |
|
Amount
|
|
Shares
Issued |
|
|
|
|
Shares
|
|
Amount
|
|
|||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
|
(in millions, except share amounts)
|
|||||||||||||||||||||||||||||||
Balance at December 31, 2017
|
512,134,311
|
|
|
$
|
5
|
|
|
1,725,000
|
|
|
$
|
4,698
|
|
|
$
|
(2,679
|
)
|
|
$
|
(44
|
)
|
|
31,269
|
|
|
$
|
(1
|
)
|
|
$
|
1,979
|
|
Comprehensive income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
208
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
208
|
|
||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Total comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
208
|
|
||||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7
|
|
||||||
Conversion of preferred stock
|
74,998,614
|
|
|
1
|
|
|
(1,725,000
|
)
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Issuance of restricted stock
|
5,076
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Cancellation of restricted stock
|
(160,168
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Performance units vested
|
214,866
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Tax withholding – stock compensation
|
(338,808
|
)
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
||||||
Balance at March 31, 2018
|
586,853,891
|
|
|
$
|
6
|
|
|
—
|
|
|
$
|
4,703
|
|
|
$
|
(2,471
|
)
|
|
$
|
(44
|
)
|
|
31,269
|
|
|
$
|
(1
|
)
|
|
$
|
2,193
|
|
Comprehensive income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
51
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
51
|
|
||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Total comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
51
|
|
||||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6
|
|
||||||
Issuance of restricted stock
|
307,743
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Cancellation of restricted stock
|
(722,465
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Tax withholding – stock compensation
|
(9,068
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Balance at June 30, 2018
|
586,430,101
|
|
|
$
|
6
|
|
|
—
|
|
|
$
|
4,709
|
|
|
$
|
(2,420
|
)
|
|
$
|
(44
|
)
|
|
31,269
|
|
|
$
|
(1
|
)
|
|
$
|
2,250
|
|
|
For the three months ended June 30,
|
|
For the six months ended June 30,
|
||||||||||||
(in millions)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Severance (including payroll taxes)
|
$
|
1
|
|
|
$
|
17
|
|
|
$
|
3
|
|
|
$
|
17
|
|
Office consolidation
|
1
|
|
|
—
|
|
|
2
|
|
|
—
|
|
||||
Professional fees
|
—
|
|
|
1
|
|
|
—
|
|
|
1
|
|
||||
Total restructuring charges (1)
|
$
|
2
|
|
|
$
|
18
|
|
|
$
|
5
|
|
|
$
|
18
|
|
(1)
|
Total restructuring charges were $2 million and $5 million for the Company’s E&P segment for the three and six months ended June 30, 2019, respectively, and $16 million and $2 million for the Company’s E&P and Midstream segments, respectively, for the three and six months ended June 30, 2018.
|
(in millions)
|
June 30, 2019
|
||
Liability at December 31, 2018
|
$
|
5
|
|
Additions
|
5
|
|
|
Distributions
|
(10
|
)
|
|
Liability at June 30, 2019
|
$
|
—
|
|
•
|
an election not to apply the recognition requirements in the leases standard to short-term leases and recognize lease payments in the consolidated statement of operations (a lease that at commencement date has an initial term of 12 months or less and does not contain a purchase option that the Company is reasonably certain to exercise);
|
•
|
a package of practical expedients to not reassess: whether a contract is or contains a lease, lease classification and initial direct costs;
|
•
|
a practical expedient that permits combining lease and non-lease components in a contract and accounting for the combination as a lease (elected by asset class);
|
•
|
a practical expedient to not reassess certain land easements in existence prior to January 1, 2019; and
|
•
|
an election to adopt the modified retrospective approach for all leases existing at or entered into after the initial date of adoption which does not require a restatement of prior period. No cumulative-effect adjustment to retained earnings was required as a result of the modified retrospective approach.
|
|
|
For the six months ended
June 30, 2019 |
||
(in millions)
|
|
|||
Operating lease cost
|
|
$
|
22
|
|
Short-term lease cost
|
|
31
|
|
|
Variable lease cost
|
|
—
|
|
|
Total lease cost
|
|
$
|
53
|
|
|
|
For the six months ended
June 30, 2019 |
||
(in millions)
|
|
|||
Cash paid for amounts included in the measurement of lease liabilities:
|
|
|
||
Operating cash flows from operating leases
|
|
$
|
22
|
|
|
|
|
||
Right-of use assets obtained in exchange for new operating liabilities:
|
|
|
||
Operating leases
|
|
$
|
6
|
|
Right-of-use asset balance: (in millions)
|
|
June 30, 2019
|
||
Operating leases
|
|
$
|
103
|
|
Lease liability balance: (in millions)
|
|
|
||
Short-term operating leases
|
|
$
|
47
|
|
Long-term operating leases
|
|
56
|
|
|
Total operating leases
|
|
$
|
103
|
|
|
|
|
||
Weighted average remaining lease term: (years)
|
|
|
||
Operating leases
|
|
3.8
|
|
|
|
|
|
||
Weighted average discount rate:
|
|
|
||
Operating leases
|
|
6.28
|
%
|
(in millions)
|
|
June 30, 2019
|
||
2019
|
|
$
|
22
|
|
2020
|
|
42
|
|
|
2021
|
|
19
|
|
|
2022
|
|
10
|
|
|
2023
|
|
8
|
|
|
2024
|
|
5
|
|
|
Thereafter
|
|
9
|
|
|
Total undiscounted lease liability
|
|
115
|
|
|
Imputed interest
|
|
(12
|
)
|
|
Total discounted lease liability
|
|
$
|
103
|
|
(in millions)
|
|
December 31, 2018
|
||
2019
|
|
$
|
38
|
|
2020
|
|
28
|
|
|
2021
|
|
14
|
|
|
2022
|
|
6
|
|
|
2023
|
|
5
|
|
|
Thereafter
|
|
4
|
|
|
Total minimum payments required
|
|
$
|
95
|
|
(in millions)
|
E&P
|
|
Midstream
|
|
Intersegment
Revenues
|
|
Total
|
||||||||
Three months ended June 30, 2019
|
|
|
|
|
|
|
|
||||||||
Gas sales
|
$
|
267
|
|
|
$
|
—
|
|
|
$
|
8
|
|
|
$
|
275
|
|
Oil sales
|
46
|
|
|
—
|
|
|
1
|
|
|
47
|
|
||||
NGL sales
|
58
|
|
|
—
|
|
|
—
|
|
|
58
|
|
||||
Marketing
|
—
|
|
|
626
|
|
|
(339
|
)
|
|
287
|
|
||||
Total
|
$
|
371
|
|
|
$
|
626
|
|
|
$
|
(330
|
)
|
|
$
|
667
|
|
|
|
|
|
|
|
|
|
||||||||
Three months ended June 30, 2018
|
|
|
|
|
|
|
|
||||||||
Gas sales
|
$
|
400
|
|
|
$
|
—
|
|
|
$
|
7
|
|
|
$
|
407
|
|
Oil sales
|
44
|
|
|
—
|
|
|
—
|
|
|
44
|
|
||||
NGL sales
|
75
|
|
|
—
|
|
|
—
|
|
|
75
|
|
||||
Marketing
|
—
|
|
|
728
|
|
|
(463
|
)
|
|
265
|
|
||||
Gas gathering (1)
|
—
|
|
|
69
|
|
|
(45
|
)
|
|
24
|
|
||||
Other (2)
|
1
|
|
|
—
|
|
|
—
|
|
|
1
|
|
||||
Total
|
$
|
520
|
|
|
$
|
797
|
|
|
$
|
(501
|
)
|
|
$
|
816
|
|
(in millions)
|
E&P
|
|
Midstream
|
|
Intersegment
Revenues |
|
Total
|
||||||||
Six months ended June 30, 2019
|
|
|
|
|
|
|
|
||||||||
Gas sales
|
$
|
688
|
|
|
$
|
—
|
|
|
$
|
17
|
|
|
$
|
705
|
|
Oil sales
|
85
|
|
|
—
|
|
|
1
|
|
|
86
|
|
||||
NGL sales
|
139
|
|
|
—
|
|
|
—
|
|
|
139
|
|
||||
Marketing
|
—
|
|
|
1,566
|
|
|
(841
|
)
|
|
725
|
|
||||
Other (2)
|
1
|
|
|
1
|
|
|
—
|
|
|
2
|
|
||||
Total
|
$
|
913
|
|
|
$
|
1,567
|
|
|
$
|
(823
|
)
|
|
$
|
1,657
|
|
|
|
|
|
|
|
|
|
||||||||
Six months ended June 30, 2018
|
|
|
|
|
|
|
|
||||||||
Gas sales
|
$
|
935
|
|
|
$
|
—
|
|
|
$
|
12
|
|
|
$
|
947
|
|
Oil sales
|
78
|
|
|
—
|
|
|
1
|
|
|
79
|
|
||||
NGL sales
|
140
|
|
|
—
|
|
|
—
|
|
|
140
|
|
||||
Marketing
|
—
|
|
|
1,557
|
|
|
(1,039
|
)
|
|
518
|
|
||||
Gas gathering (1)
|
—
|
|
|
136
|
|
|
(88
|
)
|
|
48
|
|
||||
Other (2)
|
4
|
|
|
—
|
|
|
—
|
|
|
4
|
|
||||
Total
|
$
|
1,157
|
|
|
$
|
1,693
|
|
|
$
|
(1,114
|
)
|
|
$
|
1,736
|
|
(1)
|
The Company’s gas gathering assets were divested in December 2018 as part of the Fayetteville Shale sale.
|
(2)
|
Other E&P revenues consists primarily of water sales to third-party operators, and other Midstream revenues consists primarily of sales of gas from storage.
|
|
For the three months ended June 30,
|
|
For the six months ended June 30,
|
||||||||||||
(in millions)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Northeast Appalachia
|
$
|
217
|
|
|
$
|
213
|
|
|
$
|
565
|
|
|
$
|
540
|
|
Southwest Appalachia
|
153
|
|
|
166
|
|
|
346
|
|
|
322
|
|
||||
Fayetteville Shale
|
—
|
|
|
139
|
|
|
—
|
|
|
291
|
|
||||
Other
|
1
|
|
|
2
|
|
|
2
|
|
|
4
|
|
||||
Total
|
$
|
371
|
|
|
$
|
520
|
|
|
$
|
913
|
|
|
$
|
1,157
|
|
(in millions)
|
June 30, 2019
|
|
December 31, 2018
|
||||
Receivables from contracts with customers
|
$
|
238
|
|
|
$
|
494
|
|
Other accounts receivable
|
120
|
|
|
87
|
|
||
Total accounts receivable
|
$
|
358
|
|
|
$
|
581
|
|
(in millions)
|
June 30, 2019
|
|
December 31, 2018
|
||||
Cash
|
$
|
71
|
|
|
$
|
32
|
|
Marketable securities (1)
|
69
|
|
|
169
|
|
||
Other cash equivalents (2)
|
15
|
|
|
—
|
|
||
Total
|
$
|
155
|
|
|
$
|
201
|
|
(1)
|
Consists of government stable value money market funds.
|
(2)
|
Consists of time deposits.
|
|
For the three months ended June 30,
|
|
For the six months ended June 30,
|
||||||||||||
(in millions, except share/per share amounts)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Net income
|
$
|
138
|
|
|
$
|
51
|
|
|
$
|
732
|
|
|
$
|
259
|
|
Participating securities - mandatory convertible preferred stock
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
||||
Net income attributable to common stock
|
$
|
138
|
|
|
$
|
51
|
|
|
$
|
732
|
|
|
$
|
257
|
|
|
|
|
|
|
|
|
|
||||||||
Number of common shares:
|
|
|
|
|
|
|
|
||||||||
Weighted average outstanding
|
539,005,941
|
|
|
581,159,200
|
|
|
539,362,984
|
|
|
576,255,744
|
|
||||
Issued upon assumed exercise of outstanding stock options
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Effect of issuance of non-vested restricted common stock
|
311,732
|
|
|
480,580
|
|
|
481,948
|
|
|
683,562
|
|
||||
Effect of issuance of non-vested performance units
|
629,380
|
|
|
1,238,326
|
|
|
779,810
|
|
|
1,283,434
|
|
||||
Weighted average and potential dilutive outstanding
|
539,947,053
|
|
|
582,878,106
|
|
|
540,624,742
|
|
|
578,222,740
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Earnings per common share
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
0.26
|
|
|
$
|
0.09
|
|
|
$
|
1.36
|
|
|
$
|
0.45
|
|
Diluted
|
$
|
0.26
|
|
|
$
|
0.09
|
|
|
$
|
1.35
|
|
|
$
|
0.44
|
|
|
For the three months ended June 30,
|
|
For the six months ended June 30,
|
||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||
Unexercised stock options
|
5,114,763
|
|
|
—
|
|
|
5,121,663
|
|
|
—
|
|
Unvested share-based payment
|
1,773,074
|
|
|
4,335,715
|
|
|
1,822,346
|
|
|
5,152,847
|
|
Performance units
|
241,896
|
|
|
875,800
|
|
|
250,998
|
|
|
986,585
|
|
Mandatory convertible preferred stock
|
—
|
|
|
—
|
|
|
—
|
|
|
4,972,284
|
|
Total
|
7,129,733
|
|
|
5,211,515
|
|
|
7,195,007
|
|
|
11,111,716
|
|
Fixed price swaps
|
If the Company sells a fixed price swap, the Company receives a fixed price for the contract and pays a floating market price to the counterparty. If the Company purchases a fixed price swap, the Company receives a floating market price for the contract and pays a fixed price to the counterparty.
|
|
|
Two-way costless collars
|
Arrangements that contain a fixed floor price (purchased put option) and a fixed ceiling price (sold call option) based on an index price which, in aggregate, have no net cost. At the contract settlement date, (1) if the index price is higher than the ceiling price, the Company pays the counterparty the difference between the index price and ceiling price, (2) if the index price is between the floor and ceiling prices, no payments are due from either party, and (3) if the index price is below the floor price, the Company will receive the difference between the floor price and the index price.
|
|
|
Three-way costless collars
|
Arrangements that contain a purchased put option, a sold call option and a sold put option based on an index price which, in aggregate, have no net cost. At the contract settlement date, (1) if the index price is higher than the sold call strike price, the Company pays the counterparty the difference between the index price and sold call strike price, (2) if the index price is between the purchased put strike price and the sold call strike price, no payments are due from either party, (3) if the index price is between the sold put strike price and the purchased put strike price, the Company will receive the difference between the purchased put strike price and the index price, and (4) if the index price is below the sold put strike price, the Company will receive the difference between the purchased put strike price and the sold put strike price.
|
|
|
Basis swaps
|
Arrangements that guarantee a price differential for natural gas from a specified delivery point. If the Company sells a basis swap, the Company receives a payment from the counterparty if the price differential is greater than the stated terms of the contract and pays the counterparty if the price differential is less than the stated terms of the contract. If the Company purchases a basis swap, the Company pays the counterparty if the price differential is greater than the stated terms of the contract and receives a payment from the counterparty if the price differential is less than the stated terms of the contract.
|
|
|
Call options
|
The Company purchases and sells call options in exchange for a premium. If the Company purchases a call option, the Company receives from the counterparty the excess (if any) of the market price over the strike price of the call option at the time of settlement, but if the market price is below the call’s strike price, no payment is due from either party. If the Company sells a call option, the Company pays the counterparty the excess (if any) of the market price over the strike price of the call option at the time of settlement, but if the market price is below the call’s strike price, no payment is due from either party.
|
|
|
Interest rate swaps
|
Interest rate swaps are used to fix or float interest rates on existing or anticipated indebtedness. The purpose of these instruments is to manage the Company’s existing or anticipated exposure to unfavorable interest rate changes.
|
|
Volume
(MBbls)
|
|
Weighted Average Strike Price per Bbl
|
|
Fair Value at June 30, 2019
(in millions)
|
|||||||||||||||||
|
|
Swaps
|
|
Sold Puts
|
|
Purchased Puts
|
|
Sold Calls
|
|
|||||||||||||
Oil
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
2019
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Fixed price swaps (1)
|
1,003
|
|
|
$
|
60.89
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4
|
|
Two-way costless collars
|
764
|
|
|
—
|
|
|
—
|
|
|
61.45
|
|
|
67.16
|
|
|
4
|
|
|||||
Three-way costless collars
|
276
|
|
|
—
|
|
|
45.00
|
|
|
55.00
|
|
|
63.67
|
|
|
—
|
|
|||||
Total
|
2,043
|
|
|
|
|
|
|
|
|
|
|
$
|
8
|
|
||||||||
2020
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Fixed price swaps
|
1,556
|
|
|
$
|
60.18
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
7
|
|
Two-way costless collars
|
366
|
|
|
—
|
|
|
—
|
|
|
60.00
|
|
|
69.80
|
|
|
3
|
|
|||||
Three-way costless collars
|
641
|
|
|
—
|
|
|
45.00
|
|
|
55.00
|
|
|
63.36
|
|
|
1
|
|
|||||
Total
|
2,563
|
|
|
|
|
|
|
|
|
|
|
$
|
11
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Propane
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
2019
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Fixed price swaps
|
1,955
|
|
|
$
|
30.18
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
14
|
|
Two-way costless collars
|
276
|
|
|
—
|
|
|
—
|
|
|
25.62
|
|
|
28.77
|
|
|
1
|
|
|||||
Total
|
2,231
|
|
|
|
|
|
|
|
|
|
|
$
|
15
|
|
||||||||
2020
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Fixed price swaps
|
2,196
|
|
|
$
|
26.97
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
6
|
|
Two-way costless collars
|
366
|
|
|
—
|
|
|
—
|
|
|
25.20
|
|
|
$
|
29.40
|
|
|
1
|
|
||||
Total
|
2,562
|
|
|
|
|
|
|
|
|
|
|
$
|
7
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Ethane
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
2019
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Fixed price swaps
|
1,858
|
|
|
$
|
13.90
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
10
|
|
2020
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Fixed price swaps
|
732
|
|
|
$
|
13.49
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2
|
|
(1)
|
Includes 138 MBbls of purchased fixed price oil swaps hedged at $69.10 per barrel with a fair value of ($1) million and 1,141 MBbls of sold fixed price oil swaps hedged at $61.88 with a fair value of $5 million.
|
Other Derivative Contracts
|
||||||||||
|
Volume
(Bcf)
|
|
Weighted Average Strike Price per MMBtu
|
|
Fair Value at
June 30, 2019
(in millions)
|
|||||
Purchased Call Options – Natural Gas
|
|
|
|
|
|
|||||
2019
|
17
|
|
|
$
|
3.50
|
|
|
$
|
—
|
|
2020
|
68
|
|
|
3.63
|
|
|
2
|
|
||
2021
|
57
|
|
|
3.52
|
|
|
2
|
|
||
Total
|
142
|
|
|
|
|
$
|
4
|
|
||
|
|
|
|
|
|
|||||
Sold Call Options – Natural Gas
|
|
|
|
|
|
|||||
2019
|
26
|
|
|
$
|
3.50
|
|
|
$
|
—
|
|
2020
|
137
|
|
|
3.39
|
|
|
(8
|
)
|
||
2021
|
114
|
|
|
3.33
|
|
|
(8
|
)
|
||
Total
|
277
|
|
|
|
|
$
|
(16
|
)
|
|
Volume
(Bcf)
|
|
Weighted Average Strike Price per MMBtu
|
|
Basis Differential per MMBtu
|
|
Fair Value at
June 30, 2019
($ in millions)
|
|||||||
Storage (1)
|
|
|
|
|
|
|
|
|||||||
2019
|
|
|
|
|
|
|
|
|||||||
Purchased fixed price swaps
|
1
|
|
|
$
|
2.87
|
|
|
$
|
—
|
|
|
$
|
(1
|
)
|
Purchased basis swaps
|
1
|
|
|
—
|
|
|
(0.53
|
)
|
|
—
|
|
|||
Total
|
2
|
|
|
|
|
|
|
$
|
(1
|
)
|
||||
|
|
|
|
|
|
|
|
|||||||
2020
|
|
|
|
|
|
|
|
|||||||
Fixed price swap
|
1
|
|
|
$
|
3.14
|
|
|
$
|
—
|
|
|
$
|
—
|
|
(1)
|
The Company has entered into certain derivatives to protect the value of volumes of natural gas injected into a storage facility that will be withdrawn at a later date.
|
Derivative Assets
|
|
|
|
|
|
||||
|
|
|
Fair Value
|
||||||
(in millions)
|
Balance Sheet Classification
|
|
June 30, 2019
|
|
December 31, 2018
|
||||
Derivatives not designated as hedging instruments:
|
|
|
|
|
|
||||
Fixed price swaps – natural gas
|
Derivative assets
|
|
$
|
79
|
|
|
$
|
32
|
|
Fixed price swaps – oil
|
Derivative assets
|
|
7
|
|
|
13
|
|
||
Fixed price swaps – propane
|
Derivative assets
|
|
18
|
|
|
11
|
|
||
Fixed price swaps – ethane
|
Derivative assets
|
|
11
|
|
|
7
|
|
||
Two-way costless collars – natural gas
|
Derivative assets
|
|
13
|
|
|
11
|
|
||
Two-way costless collars – oil
|
Derivative assets
|
|
6
|
|
|
6
|
|
||
Two-way costless collars – propane
|
Derivative assets
|
|
2
|
|
|
—
|
|
||
Three-way costless collars – natural gas
|
Derivative assets
|
|
65
|
|
|
41
|
|
||
Three-way costless collars – oil
|
Derivative assets
|
|
2
|
|
|
—
|
|
||
Basis swaps – natural gas
|
Derivative assets
|
|
5
|
|
|
8
|
|
||
Purchased call options – natural gas
|
Derivative assets
|
|
1
|
|
(1)
|
—
|
|
||
Interest rate swaps
|
Derivative assets
|
|
—
|
|
|
1
|
|
||
Fixed price swaps – natural gas
|
Other long-term assets
|
|
4
|
|
|
6
|
|
||
Fixed price swaps – oil
|
Other long-term assets
|
|
4
|
|
|
6
|
|
||
Fixed price swaps – propane
|
Other long-term assets
|
|
2
|
|
|
—
|
|
||
Fixed price swaps – ethane
|
Other long-term assets
|
|
1
|
|
|
1
|
|
||
Two-way costless collars – oil
|
Other long-term assets
|
|
2
|
|
|
5
|
|
||
Three-way costless collars – natural gas
|
Other long-term assets
|
|
31
|
|
|
34
|
|
||
Three-way costless collars – oil
|
Other long-term assets
|
|
2
|
|
|
—
|
|
||
Basis swaps – natural gas
|
Other long-term assets
|
|
2
|
|
|
3
|
|
||
Purchased call options – natural gas
|
Other long-term assets
|
|
4
|
|
|
6
|
|
||
Total derivative assets
|
|
|
$
|
261
|
|
|
$
|
191
|
|
Derivative Liabilities
|
|
|
|
|
|
||||
|
|
|
Fair Value
|
||||||
(in millions)
|
Balance Sheet Classification
|
|
June 30, 2019
|
|
December 31, 2018
|
||||
Derivatives not designated as hedging instruments:
|
|
|
|
|
|
||||
Purchased fixed price swap – oil
|
Derivative liabilities
|
|
$
|
1
|
|
|
$
|
6
|
|
Fixed price swaps – natural gas
|
Derivative liabilities
|
|
—
|
|
|
9
|
|
||
Fixed price swaps – ethane
|
Derivative liabilities
|
|
—
|
|
|
3
|
|
||
Two-way costless collars – natural gas
|
Derivative liabilities
|
|
—
|
|
|
7
|
|
||
Two-way costless collars – oil
|
Derivative liabilities
|
|
1
|
|
|
—
|
|
||
Three-way costless collars – natural gas
|
Derivative liabilities
|
|
37
|
|
|
33
|
|
||
Three-way costless collars – oil
|
Derivative liabilities
|
|
2
|
|
|
—
|
|
||
Basis swaps – natural gas
|
Derivative liabilities
|
|
19
|
|
|
18
|
|
||
Sold call options – natural gas
|
Derivative liabilities
|
|
5
|
|
|
3
|
|
||
Storage – fixed price swap
|
Derivative liabilities
|
|
1
|
|
|
—
|
|
||
Interest rate swaps
|
Derivative liabilities
|
|
1
|
|
|
—
|
|
||
Fixed price swaps – natural gas
|
Other long-term liabilities
|
|
—
|
|
|
1
|
|
||
Two-way costless collars – oil
|
Other long-term liabilities
|
|
—
|
|
|
1
|
|
||
Three-way costless collars – natural gas
|
Other long-term liabilities
|
|
28
|
|
|
35
|
|
||
Three-way costless collars – oil
|
Other long-term liabilities
|
|
1
|
|
|
—
|
|
||
Basis swap – natural gas
|
Other long-term liabilities
|
|
5
|
|
|
4
|
|
||
Sold call options – natural gas
|
Other long-term liabilities
|
|
11
|
|
|
19
|
|
||
Total derivative liabilities
|
|
|
$
|
112
|
|
|
$
|
139
|
|
(1)
|
The Company calculates gain (loss) on derivatives, settled, as the summation of gains and losses on positions that settled within the period.
|
(2)
|
Includes $1 million amortization of premiums paid related to certain natural gas call options for the six months ended June 30, 2018, which is included in gain (loss) on derivatives on the consolidated statements of operations.
|
(in millions)
|
Pension and Other Postretirement
|
|
Foreign Currency
|
|
Total
|
||||||
Beginning balance December 31, 2018
|
$
|
(22
|
)
|
|
$
|
(14
|
)
|
|
$
|
(36
|
)
|
Other comprehensive income before reclassifications
|
—
|
|
|
—
|
|
|
—
|
|
|||
Amounts reclassified from other comprehensive income (1)
|
4
|
|
|
—
|
|
|
4
|
|
|||
Net current-period other comprehensive income
|
4
|
|
|
—
|
|
|
4
|
|
|||
Ending balance June 30, 2019
|
$
|
(18
|
)
|
|
$
|
(14
|
)
|
|
$
|
(32
|
)
|
(1)
|
See separate table below for details about these reclassifications.
|
Details about Accumulated Other
Comprehensive Income |
|
Affected Line Item in the
Consolidated Statement of Operations |
|
Amount Reclassified from Accumulated Other Comprehensive Income
|
||
|
|
|
|
For the six months ended
June 30, 2019 |
||
|
|
|
|
(in millions)
|
||
Pension and other postretirement:
|
|
|
|
|
||
Amortization of prior service cost and net loss (1)
|
|
Other Income, Net
|
|
$
|
5
|
|
|
|
Provision for income taxes
|
|
1
|
|
|
|
|
Net income
|
|
$
|
4
|
|
|
|
|
|
|
||
Total reclassifications for the period
|
|
Net income
|
|
$
|
4
|
|
(1)
|
See Note 15 for additional details regarding the Company’s pension and other postretirement benefit plans.
|
|
June 30, 2019
|
|
December 31, 2018
|
||||||||||||
(in millions)
|
Carrying
Amount
|
|
Fair
Value
|
|
Carrying
Amount
|
|
Fair
Value
|
||||||||
Cash and cash equivalents
|
$
|
155
|
|
|
$
|
155
|
|
|
$
|
201
|
|
|
$
|
201
|
|
2018 revolving credit facility due April 2023
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Senior notes (1)
|
2,342
|
|
|
2,220
|
|
|
2,342
|
|
|
2,190
|
|
||||
Derivative instruments, net
|
149
|
|
(2)
|
149
|
|
(2)
|
52
|
|
|
52
|
|
(1)
|
Excludes unamortized debt issuance costs and debt discounts.
|
(2)
|
Includes $1 million in premiums paid related to certain natural gas purchased call options recognized as a component of derivative assets within current assets on the consolidated balance sheet.
|
|
June 30, 2019
|
||||||||||||||
|
Fair Value Measurements Using:
|
|
|
||||||||||||
(in millions)
|
Quoted Prices in Active Markets (Level 1)
|
|
Significant Other Observable Inputs (Level 2)
|
|
Significant Unobservable Inputs (Level 3)
|
|
Assets (Liabilities) at Fair Value
|
||||||||
Assets
|
|
|
|
|
|
|
|
||||||||
Fixed price swap – natural gas
|
$
|
—
|
|
|
$
|
83
|
|
|
$
|
—
|
|
|
$
|
83
|
|
Fixed price swap – oil
|
—
|
|
|
11
|
|
|
—
|
|
|
11
|
|
||||
Fixed price swap – propane
|
—
|
|
|
20
|
|
|
—
|
|
|
20
|
|
||||
Fixed price swap – ethane
|
—
|
|
|
12
|
|
|
—
|
|
|
12
|
|
||||
Two-way costless collar – natural gas
|
—
|
|
|
13
|
|
|
—
|
|
|
13
|
|
||||
Two-way costless collar – oil
|
—
|
|
|
8
|
|
|
—
|
|
|
8
|
|
||||
Two-way costless collar – propane
|
—
|
|
|
2
|
|
|
—
|
|
|
2
|
|
||||
Three-way costless collar – natural gas
|
—
|
|
|
96
|
|
|
—
|
|
|
96
|
|
||||
Three-way costless collar – oil
|
—
|
|
|
4
|
|
|
—
|
|
|
4
|
|
||||
Basis swap – natural gas
|
—
|
|
|
7
|
|
|
—
|
|
|
7
|
|
||||
Purchased call option – natural gas (1)
|
—
|
|
|
5
|
|
|
—
|
|
|
5
|
|
||||
Liabilities
|
|
|
|
|
|
|
|
||||||||
Purchased fixed price swap – oil
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
||||
Two-way costless collar – oil
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
||||
Three-way costless collar – natural gas
|
—
|
|
|
(65
|
)
|
|
—
|
|
|
(65
|
)
|
||||
Three-way costless collar – oil
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
(3
|
)
|
||||
Basis swap – natural gas
|
—
|
|
|
(24
|
)
|
|
—
|
|
|
(24
|
)
|
||||
Sold call option – natural gas
|
—
|
|
|
(16
|
)
|
|
—
|
|
|
(16
|
)
|
||||
Storage – fixed price swap
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
||||
Interest rate swap
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
||||
Total
|
$
|
—
|
|
|
$
|
149
|
|
|
$
|
—
|
|
|
$
|
149
|
|
|
December 31, 2018
|
||||||||||||||
|
Fair Value Measurements Using:
|
|
|
||||||||||||
(in millions)
|
Quoted Prices in Active Markets (Level 1)
|
|
Significant Other Observable Inputs (Level 2)
|
|
Significant Unobservable Inputs (Level 3)
|
|
Assets (Liabilities) at Fair Value
|
||||||||
Assets
|
|
|
|
|
|
|
|
||||||||
Fixed price swap – natural gas
|
$
|
—
|
|
|
$
|
38
|
|
|
$
|
—
|
|
|
$
|
38
|
|
Fixed price swap – oil
|
—
|
|
|
19
|
|
|
—
|
|
|
19
|
|
||||
Fixed price swap – propane
|
—
|
|
|
11
|
|
|
—
|
|
|
11
|
|
||||
Fixed price swap – ethane
|
—
|
|
|
8
|
|
|
—
|
|
|
8
|
|
||||
Two-way costless collar – natural gas
|
—
|
|
|
11
|
|
|
—
|
|
|
11
|
|
||||
Two-way costless collar – oil
|
—
|
|
|
11
|
|
|
—
|
|
|
11
|
|
||||
Three-way costless collar – natural gas
|
—
|
|
|
75
|
|
|
—
|
|
|
75
|
|
||||
Basis swap – natural gas
|
—
|
|
|
11
|
|
|
—
|
|
|
11
|
|
||||
Purchased call option – natural gas
|
—
|
|
|
6
|
|
|
—
|
|
|
6
|
|
||||
Interest rate swap
|
—
|
|
|
1
|
|
|
—
|
|
|
1
|
|
||||
Liabilities
|
|
|
|
|
|
|
|
||||||||
Purchased fixed price swap – oil
|
—
|
|
|
(6
|
)
|
|
—
|
|
|
(6
|
)
|
||||
Fixed price swap – natural gas
|
—
|
|
|
(10
|
)
|
|
—
|
|
|
(10
|
)
|
||||
Fixed price swap – ethane
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
(3
|
)
|
||||
Two-way costless collar – natural gas
|
—
|
|
|
(7
|
)
|
|
—
|
|
|
(7
|
)
|
||||
Two-way costless collar – oil
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
||||
Three-way costless collar – natural gas
|
—
|
|
|
(68
|
)
|
|
—
|
|
|
(68
|
)
|
||||
Basis swap – natural gas
|
—
|
|
|
(22
|
)
|
|
—
|
|
|
(22
|
)
|
||||
Sold call option – natural gas
|
—
|
|
|
(22
|
)
|
|
—
|
|
|
(22
|
)
|
||||
Total
|
$
|
—
|
|
|
$
|
52
|
|
|
$
|
—
|
|
|
$
|
52
|
|
|
For the three months ended June 30,
|
|
|
For the six months ended June 30,
|
|
||||||||||||
(in millions)
|
2019
|
|
2018
|
|
|
2019
|
|
2018
|
|
||||||||
Balance at beginning of period
|
$
|
—
|
|
|
$
|
22
|
|
|
|
$
|
—
|
|
|
$
|
22
|
|
|
Total gains (losses):
|
|
|
|
|
|
|
|
|
|
||||||||
Included in earnings
|
—
|
|
|
(8
|
)
|
|
|
—
|
|
|
(17
|
)
|
|
||||
Settlements
|
—
|
|
|
(8
|
)
|
|
|
—
|
|
|
1
|
|
(1)
|
||||
Transfers into/out of Level 3
|
—
|
|
|
(6
|
)
|
(2)
|
|
—
|
|
|
(6
|
)
|
(2)
|
||||
Balance at end of period
|
$
|
—
|
|
|
$
|
—
|
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Change in gains (losses) included in earnings relating to derivatives still held as of June 30
|
$
|
—
|
|
|
$
|
—
|
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
(1)
|
Includes $1 million amortization of premiums paid related to certain natural gas call options for the six months ended June 30, 2018.
|
(2)
|
Commodity derivatives previously presented as Level 3 were transferred to Level 2 in the second quarter of 2018 as the Company moved from using proprietary volatility inputs and forward curves to more widely available published information, increasing market observability.
|
|
June 30, 2019
|
||||||||||||||
(in millions)
|
Debt Instrument
|
|
Unamortized Issuance Expense
|
|
Unamortized Debt Discount
|
|
Total
|
||||||||
Current portion of long-term debt:
|
|
|
|
|
|
|
|
||||||||
4.05% Senior Notes due January 2020 (1)
|
$
|
52
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
52
|
|
Total current portion of long-term debt
|
$
|
52
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
52
|
|
|
|
|
|
|
|
|
|
||||||||
Long-term debt:
|
|
|
|
|
|
|
|
||||||||
Variable rate (3.880% at June 30, 2019) 2018 revolving credit facility, due April 2023
|
$
|
—
|
|
|
$
|
—
|
|
(2)
|
$
|
—
|
|
|
$
|
—
|
|
4.10% Senior Notes due March 2022
|
213
|
|
|
(1
|
)
|
|
—
|
|
|
212
|
|
||||
4.95% Senior Notes due January 2025 (1)
|
927
|
|
|
(7
|
)
|
|
(1
|
)
|
|
919
|
|
||||
7.50 % Senior Notes due April 2026
|
650
|
|
|
(8
|
)
|
|
—
|
|
|
642
|
|
||||
7.75 % Senior Notes due October 2027
|
500
|
|
|
(6
|
)
|
|
—
|
|
|
494
|
|
||||
Total long-term debt
|
$
|
2,290
|
|
|
$
|
(22
|
)
|
|
$
|
(1
|
)
|
|
$
|
2,267
|
|
|
|
|
|
|
|
|
|
||||||||
Total debt
|
$
|
2,342
|
|
|
$
|
(22
|
)
|
|
$
|
(1
|
)
|
|
$
|
2,319
|
|
|
|
|
|
|
|
|
|
||||||||
|
December 31, 2018
|
||||||||||||||
(in millions)
|
Debt Instrument
|
|
Unamortized Issuance Expense
|
|
Unamortized Debt Discount
|
|
Total
|
||||||||
Long-term debt:
|
|
|
|
|
|
|
|
||||||||
Variable rate (3.920% at December 31, 2018) 2018 term loan facility, due April 2023
|
$
|
—
|
|
|
$
|
—
|
|
(2)
|
$
|
—
|
|
|
$
|
—
|
|
4.05% Senior Notes due January 2020 (1)
|
52
|
|
|
—
|
|
|
—
|
|
|
52
|
|
||||
4.10% Senior Notes due March 2022
|
213
|
|
|
(1
|
)
|
|
—
|
|
|
212
|
|
||||
4.95% Senior Notes due January 2025 (1)
|
927
|
|
|
(7
|
)
|
|
(1
|
)
|
|
919
|
|
||||
7.50% Senior Notes due April 2026
|
650
|
|
|
(8
|
)
|
|
—
|
|
|
642
|
|
||||
7.75% Senior Notes due October 2027
|
500
|
|
|
(7
|
)
|
|
—
|
|
|
493
|
|
||||
Total long-term debt
|
$
|
2,342
|
|
|
$
|
(23
|
)
|
|
$
|
(1
|
)
|
|
$
|
2,318
|
|
(1)
|
In February and June 2016, Moody’s and S&P downgraded certain senior notes, increasing the interest rates by 175 basis points effective July 2016. As a result of the downgrades, interest rates increased to 5.80% for the 2020 Notes and 6.70% for the 2025 Notes. In April and May 2018, S&P and Moody’s upgraded certain senior notes. As a result of these upgrades, interest rates decreased to 5.30% for the 2020 Notes and 6.20% for the 2025 Notes effective July 2018. The first coupon payment to the bondholders at the lower interest rate was paid in January 2019.
|
(2)
|
At June 30, 2019 and December 31, 2018, unamortized issuance expense of $10 million and $11 million, respectively, associated with the 2018 revolving credit facility is classified as other long-term assets on the consolidated balance sheets.
|
•
|
a prohibition against incurring debt, subject to permitted exceptions;
|
•
|
a restriction on creating liens on assets, subject to permitted exceptions;
|
•
|
restrictions on mergers and asset dispositions;
|
•
|
restrictions on use of proceeds, investments, transactions with affiliates, or change of principal business; and
|
•
|
maintenance of the following financial covenants, commencing with the fiscal quarter ending June 30, 2018:
|
1.
|
Minimum current ratio of no less than 1.00 to 1.00, whereby current ratio is defined as the Company’s consolidated current assets (including unused commitments under the credit agreement, but excluding non-cash derivative assets) to consolidated current liabilities (excluding non-cash derivative obligations and current maturities of long-term debt).
|
2.
|
Maximum total net leverage ratio of no greater than (i) with respect to each fiscal quarter ending during the period from June 30, 2018 through March 31, 2019, 4.50 to 1.00, (ii) with respect to each fiscal quarter ending during the period from June 30, 2019 through March 31, 2020, 4.25 to 1.00, and (iii) with respect to each fiscal quarter ending on or after June 30, 2020, 4.00 to 1.00. Total net leverage ratio is defined as total debt less cash on hand (up to the lesser of 10% of credit limit or $150 million) divided by consolidated EBITDAX for the last four consecutive quarters. EBITDAX, as defined in the Company’s 2018 credit agreement, excludes the effects of interest expense, depreciation, depletion and amortization, income tax, any non-cash impacts from impairments, certain non-cash hedging activities, stock-based compensation expense, non-cash gains or losses on asset sales, unamortized issuance cost, unamortized debt discount and certain restructuring costs.
|
|
Payments Due by Period
|
||||||||||||||||||||||
(in millions)
|
Total
|
|
Less than 1
Year
|
|
1 to 3 Years
|
|
3 to 5 Years
|
|
5 to 8 Years
|
|
More than 8
Years
|
||||||||||||
Infrastructure currently in service
|
$
|
7,501
|
|
|
$
|
702
|
|
|
$
|
1,304
|
|
|
$
|
1,097
|
|
|
$
|
1,511
|
|
|
$
|
2,887
|
|
Pending regulatory approval and/or construction (1)
|
966
|
|
|
9
|
|
|
78
|
|
|
121
|
|
|
196
|
|
|
562
|
|
||||||
Total transportation charges
|
$
|
8,467
|
|
|
$
|
711
|
|
|
$
|
1,382
|
|
|
$
|
1,218
|
|
|
$
|
1,707
|
|
|
$
|
3,449
|
|
(1)
|
Based on estimated in-service dates as of June 30, 2019.
|
|
|
|
Pension Benefits
|
||||||||||||||
|
Consolidated Statements of
Operations Classification of
Net Periodic Benefit Cost
|
|
For the three months ended June 30,
|
|
For the six months ended June 30,
|
||||||||||||
(in millions)
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|||||||||
Service cost
|
General and administrative expenses
|
|
$
|
2
|
|
|
$
|
3
|
|
|
$
|
4
|
|
|
$
|
6
|
|
Interest cost
|
Other Income (Loss), Net
|
|
1
|
|
|
1
|
|
|
2
|
|
|
3
|
|
||||
Expected return on plan assets
|
Other Income (Loss), Net
|
|
(1
|
)
|
|
(2
|
)
|
|
(3
|
)
|
|
(4
|
)
|
||||
Amortization of prior service cost
|
Other Income (Loss), Net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Amortization of net loss
|
Other Income (Loss), Net
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
||||
Settlement loss
|
Other Income (Loss), Net
|
|
4
|
|
|
—
|
|
|
4
|
|
|
—
|
|
||||
Net periodic benefit cost
|
|
|
$
|
6
|
|
|
$
|
2
|
|
|
$
|
8
|
|
|
$
|
5
|
|
|
For the three months ended June 30,
|
|
For the six months ended June 30,
|
||||||||||||
(in millions)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Stock-based compensation cost – expensed
|
$
|
4
|
|
|
$
|
8
|
|
|
$
|
11
|
|
|
$
|
13
|
|
Stock-based compensation cost – capitalized
|
2
|
|
|
4
|
|
|
6
|
|
|
7
|
|
|
For the three months ended June 30,
|
|
For the six months ended June 30,
|
||||||||||||
(in millions)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Equity-classified awards – expensed
|
$
|
2
|
|
|
$
|
5
|
|
|
$
|
4
|
|
|
$
|
9
|
|
Equity-classified awards – capitalized
|
1
|
|
|
1
|
|
|
2
|
|
|
4
|
|
|
Number
of Options
|
|
Weighted Average
Exercise Price
|
|||
|
(in thousands)
|
|
|
|||
Outstanding at December 31, 2018
|
5,178
|
|
|
$
|
17.06
|
|
Granted
|
—
|
|
|
$
|
—
|
|
Exercised
|
—
|
|
|
$
|
—
|
|
Forfeited or expired
|
(72
|
)
|
|
$
|
18.58
|
|
Outstanding at June 30, 2019
|
5,106
|
|
|
$
|
17.04
|
|
Exercisable at June 30, 2019
|
4,590
|
|
|
$
|
18.12
|
|
|
Number
of Shares
|
|
Weighted Average
Fair Value
|
|||
|
(in thousands)
|
|
|
|||
Unvested shares at December 31, 2018
|
2,717
|
|
|
$
|
7.91
|
|
Granted
|
15
|
|
|
$
|
4.12
|
|
Vested
|
(990
|
)
|
|
$
|
7.37
|
|
Forfeited
|
(175
|
)
|
|
$
|
8.37
|
|
Unvested shares at June 30, 2019
|
1,567
|
|
|
$
|
8.17
|
|
|
Number
of Shares (1)
|
|
Weighted Average
Fair Value
|
|||
|
(in thousands)
|
|
|
|||
Unvested units at December 31, 2018
|
598
|
|
|
$
|
10.01
|
|
Granted
|
—
|
|
|
$
|
—
|
|
Vested
|
(371
|
)
|
|
$
|
9.73
|
|
Forfeited
|
(30
|
)
|
|
$
|
10.47
|
|
Unvested units at June 30, 2019
|
197
|
|
|
$
|
10.47
|
|
(1)
|
The actual payout of shares may range from a minimum of zero shares to a maximum of two shares per unit contingent upon TSR. The performance units have a three-year vesting term and the actual disbursement of shares, if any, is determined during the first quarter following the end of the three-year vesting period.
|
|
For the three months ended June 30,
|
|
For the six months ended June 30,
|
||||||||||||
(in millions)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Liability-classified stock-based compensation cost – expensed
|
$
|
2
|
|
|
$
|
3
|
|
|
$
|
7
|
|
|
$
|
4
|
|
Liability-classified stock-based compensation cost – capitalized
|
1
|
|
|
3
|
|
|
4
|
|
|
3
|
|
|
Number
of Units
|
|
Weighted Average
Fair Value
|
|||
|
(in thousands)
|
|
|
|||
Unvested shares at December 31, 2018
|
8,202
|
|
|
$
|
3.41
|
|
Granted
|
8,659
|
|
|
$
|
4.34
|
|
Vested
|
(2,617
|
)
|
|
$
|
4.09
|
|
Forfeited
|
(739
|
)
|
|
$
|
3.13
|
|
Unvested units at June 30, 2019
|
13,505
|
|
|
$
|
3.16
|
|
|
Number
of Shares
|
|
Weighted Average
Fair Value
|
|||
|
(in thousands)
|
|
|
|||
Unvested shares at December 31, 2018
|
2,803
|
|
|
$
|
3.41
|
|
Granted
|
2,757
|
|
|
$
|
4.34
|
|
Vested
|
—
|
|
|
$
|
—
|
|
Forfeited
|
(119
|
)
|
|
$
|
4.65
|
|
Unvested units at June 30, 2019
|
5,441
|
|
|
$
|
3.16
|
|
|
E&P
|
|
|
Midstream
|
|
|
Other
|
|
|
Total
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||
Three months ended June 30, 2019
|
(in millions)
|
|||||||||||||||||
Revenues from external customers
|
$
|
380
|
|
|
|
$
|
287
|
|
|
|
$
|
—
|
|
|
|
$
|
667
|
|
Intersegment revenues
|
(9
|
)
|
|
|
339
|
|
|
|
—
|
|
|
|
330
|
|
||||
Depreciation, depletion and amortization expense
|
118
|
|
|
|
3
|
|
|
|
—
|
|
|
|
121
|
|
||||
Operating income (loss)
|
30
|
|
(1)
|
|
(8
|
)
|
|
|
—
|
|
|
|
22
|
|
||||
Interest expense (2)
|
15
|
|
|
|
—
|
|
|
|
—
|
|
|
|
15
|
|
||||
Gain on derivatives
|
152
|
|
|
|
—
|
|
|
|
—
|
|
|
|
152
|
|
||||
Other loss, net
|
(5
|
)
|
|
|
—
|
|
|
|
(1
|
)
|
|
|
(6
|
)
|
||||
Provision for income taxes (2)
|
15
|
|
|
|
—
|
|
|
|
—
|
|
|
|
15
|
|
||||
Assets
|
5,945
|
|
(3)
|
|
277
|
|
|
|
323
|
|
(4)
|
|
6,545
|
|
||||
Capital investments (5)
|
367
|
|
|
|
—
|
|
|
|
1
|
|
|
|
368
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
||||||||
Three months ended June 30, 2018
|
|
|
|
|
|
|
|
|
|
|
||||||||
Revenues from external customers
|
$
|
527
|
|
|
|
$
|
289
|
|
|
|
$
|
—
|
|
|
|
$
|
816
|
|
Intersegment revenues
|
(7
|
)
|
|
|
508
|
|
|
|
—
|
|
|
|
501
|
|
||||
Depreciation, depletion and amortization expense
|
126
|
|
|
|
16
|
|
|
|
—
|
|
|
|
142
|
|
||||
Operating income (6)
|
97
|
|
(1)
|
|
27
|
|
(7)
|
|
—
|
|
|
|
124
|
|
||||
Interest expense (2)
|
32
|
|
|
|
—
|
|
|
|
—
|
|
|
|
32
|
|
||||
Loss on derivatives
|
(36
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
(36
|
)
|
||||
Loss on early extinguishment of debt
|
—
|
|
|
|
—
|
|
|
|
(8
|
)
|
|
|
(8
|
)
|
||||
Other income, net
|
3
|
|
|
|
—
|
|
|
|
—
|
|
|
|
3
|
|
||||
Assets
|
5,583
|
|
(3)
|
|
1,228
|
|
|
|
231
|
|
(4)
|
|
7,042
|
|
||||
Capital investments (5)
|
396
|
|
|
|
5
|
|
|
|
2
|
|
|
|
403
|
|
|
E&P
|
|
|
Midstream
|
|
|
Other
|
|
|
Total
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||
Six months ended June 30, 2019
|
(in millions)
|
|||||||||||||||||
Revenues from external customers
|
$
|
931
|
|
|
|
$
|
726
|
|
|
|
$
|
—
|
|
|
|
$
|
1,657
|
|
Intersegment revenues
|
(18
|
)
|
|
|
841
|
|
|
|
—
|
|
|
|
823
|
|
||||
Depreciation, depletion and amortization expense
|
228
|
|
|
|
5
|
|
|
|
—
|
|
|
|
233
|
|
||||
Operating income (loss)
|
240
|
|
(1)
|
|
(5
|
)
|
|
|
—
|
|
|
|
235
|
|
||||
Interest expense (2)
|
29
|
|
|
|
—
|
|
|
|
—
|
|
|
|
29
|
|
||||
Gain on derivatives
|
120
|
|
|
|
—
|
|
|
|
—
|
|
|
|
120
|
|
||||
Other loss, net
|
(4
|
)
|
|
|
—
|
|
|
|
(1
|
)
|
|
|
(5
|
)
|
||||
Benefit from income taxes (2)
|
(411
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
(411
|
)
|
||||
Assets
|
5,945
|
|
(3)
|
|
277
|
|
|
|
323
|
|
(4)
|
|
6,545
|
|
||||
Capital investments (5)
|
692
|
|
|
|
—
|
|
|
|
1
|
|
|
|
693
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
||||||||
Six months ended June 30, 2018
|
|
|
|
|
|
|
|
|
|
|
||||||||
Revenues from external customers
|
$
|
1,170
|
|
|
|
$
|
566
|
|
|
|
$
|
—
|
|
|
|
$
|
1,736
|
|
Intersegment revenues
|
(13
|
)
|
|
|
1,127
|
|
|
|
—
|
|
|
|
1,114
|
|
||||
Depreciation, depletion and amortization expense
|
243
|
|
|
|
42
|
|
(8)
|
|
—
|
|
|
|
285
|
|
||||
Operating income (6)
|
335
|
|
(1)
|
|
44
|
|
(7)
|
|
—
|
|
|
|
379
|
|
||||
Interest expense (2)
|
71
|
|
|
|
—
|
|
|
|
—
|
|
|
|
71
|
|
||||
Loss on derivatives
|
(43
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
(43
|
)
|
||||
Loss on early extinguishment of debt
|
—
|
|
|
|
—
|
|
|
|
(8
|
)
|
|
|
(8
|
)
|
||||
Other income (loss), net
|
3
|
|
|
|
(1
|
)
|
|
|
—
|
|
|
|
2
|
|
||||
Assets
|
5,583
|
|
(3)
|
|
1,228
|
|
|
|
231
|
|
(4)
|
|
7,042
|
|
||||
Capital investments (5)
|
730
|
|
|
|
9
|
|
|
|
2
|
|
|
|
741
|
|
(1)
|
Operating income for the E&P segment includes $2 million and $16 million of restructuring charges for the three months ended June 30, 2019 and 2018, respectively, and $5 million and $16 million of restructuring charges for the six months ended June 30, 2019 and 2018, respectively.
|
(2)
|
Interest expense and provision (benefit) for income taxes by segment is an allocation of corporate amounts as they are incurred at the corporate level.
|
(3)
|
E&P assets includes office, technology, water infrastructure, drilling rigs and other ancillary equipment not directly related to natural gas and oil properties. This also includes deferred tax assets which are an allocation of corporate amounts as they are incurred at the corporate level.
|
(4)
|
Other assets represent corporate assets not allocated to segments and assets for non-reportable segments. At June 30, 2019 and 2018, other assets included approximately $155 million and $37 million, respectively, in cash and cash equivalents, $68 million and $89 million, respectively, in income taxes receivable, $50 million and $83 million, respectively, in property, plant and equipment, $10 million and $12 million, respectively, in unamortized debt expense, $6 million and $8 million, respectively, in a non-qualified retirement plan and $3 million, respectively, in other assets for both periods presented. Additionally, the June 30, 2019 asset balance includes $29 million in right-of-use lease assets.
|
(5)
|
Capital investments include increases of $39 million and $19 million for the three months ended June 30, 2019 and 2018, respectively, and increases of $105 million and $52 million for the six months ended June 30, 2019 and 2018, respectively, relating to the change in accrued expenditures between years.
|
(6)
|
Includes the impact of Fayetteville Shale-related E&P and Midstream operations which were divested on December 3, 2018.
|
(7)
|
Operating income for the Midstream segment includes $2 million related to restructuring charges for the three and six months ended June 30, 2018.
|
(8)
|
Includes a $10 million impairment related to certain non-core gathering assets.
|
(in millions)
|
Parent
|
|
Guarantors
|
|
Non-Guarantors
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Three months ended June 30, 2019
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating Revenues:
|
|
|
|
|
|
|
|
|
|
||||||||||
Gas sales
|
$
|
—
|
|
|
$
|
275
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
275
|
|
Oil sales
|
—
|
|
|
47
|
|
|
—
|
|
|
—
|
|
|
47
|
|
|||||
NGL sales
|
—
|
|
|
58
|
|
|
—
|
|
|
—
|
|
|
58
|
|
|||||
Marketing
|
—
|
|
|
287
|
|
|
—
|
|
|
—
|
|
|
287
|
|
|||||
|
—
|
|
|
667
|
|
|
—
|
|
|
—
|
|
|
667
|
|
|||||
Operating Costs and Expenses:
|
|
|
|
|
|
|
|
|
|
||||||||||
Marketing purchases
|
—
|
|
|
293
|
|
|
—
|
|
|
—
|
|
|
293
|
|
|||||
Operating expenses
|
—
|
|
|
169
|
|
|
—
|
|
|
—
|
|
|
169
|
|
|||||
General and administrative expenses
|
—
|
|
|
40
|
|
|
—
|
|
|
—
|
|
|
40
|
|
|||||
Loss on sale of operating assets
|
—
|
|
|
3
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|||||
Restructuring charges
|
—
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|||||
Depreciation, depletion and amortization
|
—
|
|
|
121
|
|
|
—
|
|
|
—
|
|
|
121
|
|
|||||
Taxes, other than income taxes
|
—
|
|
|
17
|
|
|
—
|
|
|
—
|
|
|
17
|
|
|||||
|
—
|
|
|
645
|
|
|
—
|
|
|
—
|
|
|
645
|
|
|||||
Operating Income
|
—
|
|
|
22
|
|
|
—
|
|
|
—
|
|
|
22
|
|
|||||
Interest Expense, Net
|
15
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
15
|
|
|||||
Gain on Derivatives
|
—
|
|
|
152
|
|
|
—
|
|
|
—
|
|
|
152
|
|
|||||
Other Loss, Net
|
—
|
|
|
(6
|
)
|
|
—
|
|
|
—
|
|
|
(6
|
)
|
|||||
Equity in Earnings of Subsidiaries
|
153
|
|
|
—
|
|
|
—
|
|
|
(153
|
)
|
|
—
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Income (Loss) Before Income Taxes
|
138
|
|
|
168
|
|
|
—
|
|
|
(153
|
)
|
|
153
|
|
|||||
Provision for Income Taxes
|
—
|
|
|
15
|
|
|
—
|
|
|
—
|
|
|
15
|
|
|||||
Net Income (Loss)
|
$
|
138
|
|
|
$
|
153
|
|
|
$
|
—
|
|
|
$
|
(153
|
)
|
|
$
|
138
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net Income (Loss)
|
$
|
138
|
|
|
$
|
153
|
|
|
$
|
—
|
|
|
$
|
(153
|
)
|
|
$
|
138
|
|
Other Comprehensive Income
|
4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|||||
Comprehensive Income (Loss)
|
$
|
142
|
|
|
$
|
153
|
|
|
$
|
—
|
|
|
$
|
(153
|
)
|
|
$
|
142
|
|
(in millions)
|
Parent
|
|
Guarantors
|
|
Non-Guarantors
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Three months ended June 30, 2018
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating Revenues:
|
|
|
|
|
|
|
|
|
|
||||||||||
Gas sales
|
$
|
—
|
|
|
$
|
407
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
407
|
|
Oil sales
|
—
|
|
|
44
|
|
|
—
|
|
|
—
|
|
|
44
|
|
|||||
NGL sales
|
—
|
|
|
75
|
|
|
—
|
|
|
—
|
|
|
75
|
|
|||||
Marketing
|
—
|
|
|
265
|
|
|
—
|
|
|
—
|
|
|
265
|
|
|||||
Gas gathering
|
—
|
|
|
24
|
|
|
—
|
|
|
—
|
|
|
24
|
|
|||||
Other
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|||||
|
—
|
|
|
816
|
|
|
—
|
|
|
—
|
|
|
816
|
|
|||||
Operating Costs and Expenses:
|
|
|
|
|
|
|
|
|
|
||||||||||
Marketing purchases
|
—
|
|
|
265
|
|
|
—
|
|
|
—
|
|
|
265
|
|
|||||
Operating expenses
|
—
|
|
|
193
|
|
|
—
|
|
|
—
|
|
|
193
|
|
|||||
General and administrative expenses
|
—
|
|
|
59
|
|
|
—
|
|
|
—
|
|
|
59
|
|
|||||
Restructuring charges
|
—
|
|
|
18
|
|
|
—
|
|
|
—
|
|
|
18
|
|
|||||
Depreciation, depletion and amortization
|
—
|
|
|
142
|
|
|
—
|
|
|
—
|
|
|
142
|
|
|||||
Taxes, other than income taxes
|
—
|
|
|
15
|
|
|
—
|
|
|
—
|
|
|
15
|
|
|||||
|
—
|
|
|
692
|
|
|
—
|
|
|
—
|
|
|
692
|
|
|||||
Operating Income
|
—
|
|
|
124
|
|
|
—
|
|
|
—
|
|
|
124
|
|
|||||
Interest Expense, Net
|
32
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
32
|
|
|||||
Loss on Derivatives
|
—
|
|
|
(36
|
)
|
|
—
|
|
|
—
|
|
|
(36
|
)
|
|||||
Loss on Early Extinguishment of Debt
|
(8
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(8
|
)
|
|||||
Other Income, Net
|
—
|
|
|
3
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|||||
Equity in Earnings of Subsidiaries
|
91
|
|
|
—
|
|
|
—
|
|
|
(91
|
)
|
|
—
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Income (Loss) Before Income Taxes
|
51
|
|
|
91
|
|
|
—
|
|
|
(91
|
)
|
|
51
|
|
|||||
Provision for Income Taxes
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Net Income (Loss)
|
$
|
51
|
|
|
$
|
91
|
|
|
$
|
—
|
|
|
$
|
(91
|
)
|
|
$
|
51
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net Income (Loss)
|
$
|
51
|
|
|
$
|
91
|
|
|
$
|
—
|
|
|
$
|
(91
|
)
|
|
$
|
51
|
|
Other Comprehensive Income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Comprehensive Income (Loss)
|
$
|
51
|
|
|
$
|
91
|
|
|
$
|
—
|
|
|
$
|
(91
|
)
|
|
$
|
51
|
|
(in millions)
|
Parent
|
|
Guarantors
|
|
Non-Guarantors
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Six months ended June 30, 2019
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating Revenues:
|
|
|
|
|
|
|
|
|
|
||||||||||
Gas sales
|
$
|
—
|
|
|
$
|
705
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
705
|
|
Oil sales
|
—
|
|
|
86
|
|
|
—
|
|
|
—
|
|
|
86
|
|
|||||
NGL sales
|
—
|
|
|
139
|
|
|
—
|
|
|
—
|
|
|
139
|
|
|||||
Marketing
|
—
|
|
|
725
|
|
|
—
|
|
|
—
|
|
|
725
|
|
|||||
Other
|
—
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|||||
|
—
|
|
|
1,657
|
|
|
—
|
|
|
—
|
|
|
1,657
|
|
|||||
Operating Costs and Expenses:
|
|
|
|
|
|
|
|
|
|
||||||||||
Marketing purchases
|
—
|
|
|
734
|
|
|
—
|
|
|
—
|
|
|
734
|
|
|||||
Operating expenses
|
—
|
|
|
334
|
|
|
—
|
|
|
—
|
|
|
334
|
|
|||||
General and administrative expenses
|
—
|
|
|
77
|
|
|
—
|
|
|
—
|
|
|
77
|
|
|||||
Loss on sale of operating assets
|
—
|
|
|
3
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|||||
Restructuring charges
|
—
|
|
|
5
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|||||
Depreciation, depletion and amortization
|
—
|
|
|
233
|
|
|
—
|
|
|
—
|
|
|
233
|
|
|||||
Taxes, other than income taxes
|
—
|
|
|
36
|
|
|
—
|
|
|
—
|
|
|
36
|
|
|||||
|
—
|
|
|
1,422
|
|
|
—
|
|
|
—
|
|
|
1,422
|
|
|||||
Operating Income
|
—
|
|
|
235
|
|
|
—
|
|
|
—
|
|
|
235
|
|
|||||
Interest Expense, Net
|
29
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
29
|
|
|||||
Gain on Derivatives
|
—
|
|
|
120
|
|
|
—
|
|
|
—
|
|
|
120
|
|
|||||
Other Loss, Net
|
—
|
|
|
(5
|
)
|
|
—
|
|
|
—
|
|
|
(5
|
)
|
|||||
Equity in Earnings of Subsidiaries
|
761
|
|
|
—
|
|
|
—
|
|
|
(761
|
)
|
|
—
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Income (Loss) Before Income Taxes
|
732
|
|
|
350
|
|
|
—
|
|
|
(761
|
)
|
|
321
|
|
|||||
Benefit from Income Taxes
|
—
|
|
|
(411
|
)
|
|
—
|
|
|
—
|
|
|
(411
|
)
|
|||||
Net Income (Loss)
|
$
|
732
|
|
|
$
|
761
|
|
|
$
|
—
|
|
|
$
|
(761
|
)
|
|
$
|
732
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net Income (Loss)
|
$
|
732
|
|
|
$
|
761
|
|
|
$
|
—
|
|
|
$
|
(761
|
)
|
|
$
|
732
|
|
Other Comprehensive Income
|
4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|||||
Comprehensive Income (Loss)
|
$
|
736
|
|
|
$
|
761
|
|
|
$
|
—
|
|
|
$
|
(761
|
)
|
|
$
|
736
|
|
(in millions)
|
Parent
|
|
Guarantors
|
|
Non-Guarantors
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Six months ended June 30, 2018
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating Revenues:
|
|
|
|
|
|
|
|
|
|
||||||||||
Gas sales
|
$
|
—
|
|
|
$
|
947
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
947
|
|
Oil sales
|
—
|
|
|
79
|
|
|
—
|
|
|
—
|
|
|
79
|
|
|||||
NGL sales
|
—
|
|
|
140
|
|
|
—
|
|
|
—
|
|
|
140
|
|
|||||
Marketing
|
—
|
|
|
518
|
|
|
—
|
|
|
—
|
|
|
518
|
|
|||||
Gas gathering
|
—
|
|
|
48
|
|
|
—
|
|
|
—
|
|
|
48
|
|
|||||
Other
|
—
|
|
|
4
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|||||
|
—
|
|
|
1,736
|
|
|
—
|
|
|
—
|
|
|
1,736
|
|
|||||
Operating Costs and Expenses:
|
|
|
|
|
|
|
|
|
|
||||||||||
Marketing purchases
|
—
|
|
|
520
|
|
|
—
|
|
|
—
|
|
|
520
|
|
|||||
Operating expenses
|
—
|
|
|
382
|
|
|
—
|
|
|
—
|
|
|
382
|
|
|||||
General and administrative expenses
|
—
|
|
|
114
|
|
|
—
|
|
|
—
|
|
|
114
|
|
|||||
Restructuring charges
|
—
|
|
|
18
|
|
|
—
|
|
|
—
|
|
|
18
|
|
|||||
Depreciation, depletion and amortization
|
—
|
|
|
285
|
|
|
—
|
|
|
—
|
|
|
285
|
|
|||||
Taxes, other than income taxes
|
—
|
|
|
38
|
|
|
—
|
|
|
—
|
|
|
38
|
|
|||||
|
—
|
|
|
1,357
|
|
|
—
|
|
|
—
|
|
|
1,357
|
|
|||||
Operating Income
|
—
|
|
|
379
|
|
|
—
|
|
|
—
|
|
|
379
|
|
|||||
Interest Expense, Net
|
71
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
71
|
|
|||||
Loss on Derivatives
|
—
|
|
|
(43
|
)
|
|
—
|
|
|
—
|
|
|
(43
|
)
|
|||||
Loss on Early Extinguishment of Debt
|
(8
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(8
|
)
|
|||||
Other Income, Net
|
—
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|||||
Equity in Earnings of Subsidiaries
|
338
|
|
|
—
|
|
|
—
|
|
|
(338
|
)
|
|
—
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Income (Loss) Before Income Taxes
|
259
|
|
|
338
|
|
|
—
|
|
|
(338
|
)
|
|
259
|
|
|||||
Provision for Income Taxes
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Net Income (Loss)
|
$
|
259
|
|
|
$
|
338
|
|
|
$
|
—
|
|
|
$
|
(338
|
)
|
|
$
|
259
|
|
Participating securities - mandatory convertible preferred stock
|
2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|||||
Net Income (Loss) Attributable to Common Stock
|
$
|
257
|
|
|
$
|
338
|
|
|
$
|
—
|
|
|
$
|
(338
|
)
|
|
$
|
257
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net Income (Loss)
|
$
|
259
|
|
|
$
|
338
|
|
|
$
|
—
|
|
|
$
|
(338
|
)
|
|
$
|
259
|
|
Other Comprehensive Income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Comprehensive Income (Loss)
|
$
|
259
|
|
|
$
|
338
|
|
|
$
|
—
|
|
|
$
|
(338
|
)
|
|
$
|
259
|
|
(in millions)
|
Parent
|
|
Guarantors
|
|
Non-Guarantors
|
|
Eliminations
|
|
Consolidated
|
||||||||||
June 30, 2019
|
|
|
|
|
|
|
|
|
|
||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
155
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
155
|
|
Accounts receivable, net
|
—
|
|
|
358
|
|
|
—
|
|
|
—
|
|
|
358
|
|
|||||
Other current assets
|
5
|
|
|
246
|
|
|
—
|
|
|
—
|
|
|
251
|
|
|||||
Total current assets
|
160
|
|
|
604
|
|
|
—
|
|
|
—
|
|
|
764
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Intercompany receivables
|
7,894
|
|
|
—
|
|
|
—
|
|
|
(7,894
|
)
|
|
—
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Natural gas and oil properties, using the full cost method
|
—
|
|
|
24,769
|
|
|
54
|
|
|
—
|
|
|
24,823
|
|
|||||
Other
|
196
|
|
|
330
|
|
|
29
|
|
|
—
|
|
|
555
|
|
|||||
Less: Accumulated depreciation, depletion and amortization
|
(162
|
)
|
|
(20,059
|
)
|
|
(58
|
)
|
|
—
|
|
|
(20,279
|
)
|
|||||
Total property and equipment, net
|
34
|
|
|
5,040
|
|
|
25
|
|
|
—
|
|
|
5,099
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Investments in subsidiaries (equity method)
|
—
|
|
|
23
|
|
|
—
|
|
|
(23
|
)
|
|
—
|
|
|||||
Other long-term assets
|
45
|
|
|
637
|
|
|
—
|
|
|
—
|
|
|
682
|
|
|||||
TOTAL ASSETS
|
$
|
8,133
|
|
|
$
|
6,304
|
|
|
$
|
25
|
|
|
$
|
(7,917
|
)
|
|
$
|
6,545
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts payable
|
$
|
72
|
|
|
$
|
513
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
585
|
|
Other current liabilities
|
193
|
|
|
134
|
|
|
—
|
|
|
—
|
|
|
327
|
|
|||||
Total current liabilities
|
265
|
|
|
647
|
|
|
—
|
|
|
—
|
|
|
912
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Intercompany payables
|
—
|
|
|
7,892
|
|
|
2
|
|
|
(7,894
|
)
|
|
—
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Long-term debt
|
2,267
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,267
|
|
|||||
Pension and other postretirement liabilities
|
39
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
39
|
|
|||||
Other long-term liabilities
|
39
|
|
|
206
|
|
|
—
|
|
|
—
|
|
|
245
|
|
|||||
Negative carrying amount of subsidiaries, net
|
2,441
|
|
|
—
|
|
|
—
|
|
|
(2,441
|
)
|
|
—
|
|
|||||
Total long-term liabilities
|
4,786
|
|
|
206
|
|
|
—
|
|
|
(2,441
|
)
|
|
2,551
|
|
|||||
Commitments and contingencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Total equity (accumulated deficit)
|
3,082
|
|
|
(2,441
|
)
|
|
23
|
|
|
2,418
|
|
|
3,082
|
|
|||||
TOTAL LIABILITIES AND EQUITY
|
$
|
8,133
|
|
|
$
|
6,304
|
|
|
$
|
25
|
|
|
$
|
(7,917
|
)
|
|
$
|
6,545
|
|
(in millions)
|
Parent
|
|
Guarantors
|
|
Non-Guarantors
|
|
Eliminations
|
|
Consolidated
|
||||||||||
December 31, 2018
|
|
|
|
|
|
|
|
|
|
||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
201
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
201
|
|
Accounts receivable, net
|
4
|
|
|
577
|
|
|
—
|
|
|
—
|
|
|
581
|
|
|||||
Other current assets
|
8
|
|
|
166
|
|
|
—
|
|
|
—
|
|
|
174
|
|
|||||
Total current assets
|
213
|
|
|
743
|
|
|
—
|
|
|
—
|
|
|
956
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Intercompany receivables
|
7,932
|
|
|
—
|
|
|
—
|
|
|
(7,932
|
)
|
|
—
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Natural gas and oil properties, using the full cost method
|
—
|
|
|
24,128
|
|
|
52
|
|
|
—
|
|
|
24,180
|
|
|||||
Other
|
197
|
|
|
301
|
|
|
27
|
|
|
—
|
|
|
525
|
|
|||||
Less: Accumulated depreciation, depletion and amortization
|
(154
|
)
|
|
(19,840
|
)
|
|
(55
|
)
|
|
—
|
|
|
(20,049
|
)
|
|||||
Total property and equipment, net
|
43
|
|
|
4,589
|
|
|
24
|
|
|
—
|
|
|
4,656
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Investments in subsidiaries (equity method)
|
—
|
|
|
24
|
|
|
—
|
|
|
(24
|
)
|
|
—
|
|
|||||
Other long-term assets
|
19
|
|
|
166
|
|
|
—
|
|
|
—
|
|
|
185
|
|
|||||
TOTAL ASSETS
|
$
|
8,207
|
|
|
$
|
5,522
|
|
|
$
|
24
|
|
|
$
|
(7,956
|
)
|
|
$
|
5,797
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts payable
|
$
|
113
|
|
|
$
|
496
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
609
|
|
Other current liabilities
|
115
|
|
|
122
|
|
|
—
|
|
|
—
|
|
|
237
|
|
|||||
Total current liabilities
|
228
|
|
|
618
|
|
|
—
|
|
|
—
|
|
|
846
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Intercompany payables
|
—
|
|
|
7,932
|
|
|
—
|
|
|
(7,932
|
)
|
|
—
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Long-term debt
|
2,318
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,318
|
|
|||||
Pension and other postretirement liabilities
|
46
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
46
|
|
|||||
Other long-term liabilities
|
54
|
|
|
171
|
|
|
—
|
|
|
—
|
|
|
225
|
|
|||||
Negative carrying amount of subsidiaries, net
|
3,199
|
|
|
—
|
|
|
—
|
|
|
(3,199
|
)
|
|
—
|
|
|||||
Total long-term liabilities
|
5,617
|
|
|
171
|
|
|
—
|
|
|
(3,199
|
)
|
|
2,589
|
|
|||||
Commitments and contingencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Total equity (accumulated deficit)
|
2,362
|
|
|
(3,199
|
)
|
|
24
|
|
|
3,175
|
|
|
2,362
|
|
|||||
TOTAL LIABILITIES AND EQUITY
|
$
|
8,207
|
|
|
$
|
5,522
|
|
|
$
|
24
|
|
|
$
|
(7,956
|
)
|
|
$
|
5,797
|
|
(in millions)
|
Parent
|
|
Guarantors
|
|
Non-Guarantors
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Six months ended June 30, 2019
|
|
|
|
|
|
|
|
|
|
||||||||||
Net cash provided by (used in) operating activities
|
$
|
1,124
|
|
|
$
|
179
|
|
|
$
|
—
|
|
|
$
|
(760
|
)
|
|
$
|
543
|
|
Investing activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Capital investments
|
(1
|
)
|
|
(584
|
)
|
|
(1
|
)
|
|
—
|
|
|
(586
|
)
|
|||||
Proceeds from sale
|
—
|
|
|
26
|
|
|
—
|
|
|
—
|
|
|
26
|
|
|||||
Net cash used in investing activities
|
(1
|
)
|
|
(558
|
)
|
|
(1
|
)
|
|
—
|
|
|
(560
|
)
|
|||||
Financing activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Intercompany activities
|
(1,140
|
)
|
|
379
|
|
|
1
|
|
|
760
|
|
|
—
|
|
|||||
Change in bank drafts outstanding
|
(7
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(7
|
)
|
|||||
Purchase of treasury stock
|
(21
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(21
|
)
|
|||||
Cash paid for tax withholding
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|||||
Net cash provided by (used in) financing activities
|
(1,169
|
)
|
|
379
|
|
|
1
|
|
|
760
|
|
|
(29
|
)
|
|||||
Decrease in cash and cash equivalents
|
(46
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(46
|
)
|
|||||
Cash and cash equivalents at beginning of year
|
201
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
201
|
|
|||||
Cash and cash equivalents at end of period
|
$
|
155
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
155
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Six months ended June 30, 2018
|
|
|
|
|
|
|
|
|
|
||||||||||
Net cash provided by (used in) operating activities
|
$
|
276
|
|
|
$
|
725
|
|
|
$
|
—
|
|
|
$
|
(337
|
)
|
|
$
|
664
|
|
Investing activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Capital investments
|
(6
|
)
|
|
(678
|
)
|
|
—
|
|
|
—
|
|
|
(684
|
)
|
|||||
Other
|
—
|
|
|
9
|
|
|
—
|
|
|
—
|
|
|
9
|
|
|||||
Net cash used in investing activities
|
(6
|
)
|
|
(669
|
)
|
|
—
|
|
|
—
|
|
|
(675
|
)
|
|||||
Financing activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Intercompany activities
|
(287
|
)
|
|
(50
|
)
|
|
—
|
|
|
337
|
|
|
—
|
|
|||||
Payments on long-term debt
|
(1,191
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,191
|
)
|
|||||
Payments on revolving credit facility
|
(645
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(645
|
)
|
|||||
Borrowings under revolving credit facility
|
1,005
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,005
|
|
|||||
Preferred stock dividend
|
(27
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(27
|
)
|
|||||
Other
|
(10
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10
|
)
|
|||||
Net cash provided by (used in) financing activities
|
(1,155
|
)
|
|
(50
|
)
|
|
—
|
|
|
337
|
|
|
(868
|
)
|
|||||
Increase (decrease) in cash and cash equivalents
|
(885
|
)
|
|
6
|
|
|
—
|
|
|
—
|
|
|
(879
|
)
|
|||||
Cash and cash equivalents at beginning of year
|
914
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
916
|
|
|||||
Cash and cash equivalents at end of period
|
$
|
29
|
|
|
$
|
8
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
37
|
|
•
|
Net income attributable to common stock of $138 million, or $0.26 per diluted share, increased 171% compared to net income attributable to common stock of $51 million, or $0.09 per diluted share, for the same period in 2018. The increase was primarily due to a $188 million positive impact of derivatives, including a $174 million improvement in unsettled derivatives as compared to the same period in 2018, which was partially offset by decreased operating income and the divestiture of the Fayetteville Shale E&P and related midstream gathering assets on December 3, 2018.
|
•
|
Operating income of $22 million decreased 82% compared to operating income of $124 million for the same period in 2018 on a consolidated basis. The decrease was primarily due to lower margins associated with reduced commodity prices and the divestiture of the Fayetteville Shale E&P and related midstream gathering assets in December 2018.
|
•
|
Net cash provided by operating activities of $543 million decreased 18% from $664 million for the same period in 2018 primarily due to the decrease in operating income discussed above.
|
•
|
Total capital investing of $368 million decreased 9% from $403 million for the same period in 2018.
|
•
|
E&P segment operating income of $30 million decreased 69% from $97 million for the same period in 2018.
|
•
|
Total net production of 186 Bcfe was comprised of 79% natural gas and 21% NGLs and oil. E&P segment production volumes of 234 Bcfe for the second quarter of 2018 include 67 Bcf of production related to our operations in the Fayetteville Shale, which was sold in December 2018. Excluding the impact of the production related to the sold Fayetteville Shale assets, our production increased 11% from 167 Bcfe in the same period in 2018, and our liquids production increased 15% over the same periods.
|
•
|
Excluding the effect of derivatives, our realized natural gas price of $1.80 per Mcf decreased 10% from the same period in 2018, our realized oil price of $49.55 per barrel decreased 18% from the same period in 2018 and our realized NGL price of $10.51 per barrel decreased 32% from the same period in 2018. Our total weighted average realized price excluding the effect of derivatives of $1.99 per Mcfe decreased 10% from the same period in 2018.
|
•
|
E&P segment invested $367 million in capital; drilling 41 wells, completing 40 wells and placing 36 wells to sales.
|
|
For the three months ended June 30,
|
|
For the six months ended June 30,
|
||||||||||||
(in millions)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Revenues
|
$
|
371
|
|
|
$
|
520
|
|
|
$
|
913
|
|
|
$
|
1,157
|
|
Operating costs and expenses
|
341
|
|
|
423
|
|
|
673
|
|
|
822
|
|
||||
Operating income
|
$
|
30
|
|
|
$
|
97
|
|
|
$
|
240
|
|
|
$
|
335
|
|
|
|
|
|
|
|
|
|
||||||||
Gain on derivatives, settled (1)
|
$
|
34
|
|
|
$
|
20
|
|
|
$
|
24
|
|
|
$
|
11
|
|
•
|
E&P segment operating income for the second quarter of 2018 included $20 million related to our operations in the Fayetteville Shale, which was sold in December 2018. Excluding amounts relating to the Fayetteville Shale, E&P segment operating income decreased $47 million for the three months ended June 30, 2019, compared to the same period in 2018, due to lower margins associated with decreased commodity pricing.
|
•
|
Operating income for the E&P segment included $51 million related to our operations in the Fayetteville Shale for the six months ended June 30, 2018. Excluding the amounts related to the Fayetteville Shale, operating income for the E&P segment decreased $44 million for the six months ended June 30, 2019, compared to the same period in 2018, due to lower margins associated with decreased commodity pricing.
|
|
Three months ended June 30,
|
||||||||||||||
(in millions except percentages)
|
Natural
Gas |
|
Oil
|
|
NGLs
|
|
Total
|
||||||||
2018 sales revenues (1)
|
$
|
400
|
|
|
$
|
44
|
|
|
$
|
75
|
|
|
$
|
519
|
|
Changes associated with the Fayetteville Shale sale (2)
|
(139
|
)
|
|
—
|
|
|
—
|
|
|
(139
|
)
|
||||
2018 sales revenues, net of Fayetteville Shale revenues
|
261
|
|
|
44
|
|
|
75
|
|
|
380
|
|
||||
Changes associated with prices
|
(22
|
)
|
|
(10
|
)
|
|
(27
|
)
|
|
(59
|
)
|
||||
Changes associated with production volumes
|
28
|
|
|
12
|
|
|
10
|
|
|
50
|
|
||||
2019 sales revenues
|
$
|
267
|
|
|
$
|
46
|
|
|
$
|
58
|
|
|
$
|
371
|
|
Increase (decrease) from 2018, net of Fayetteville Shale revenues
|
2
|
%
|
|
5
|
%
|
|
(23
|
)%
|
|
(2
|
%)
|
(1)
|
Excludes $1 million in other operating revenues for the three months ended June 30, 2018 related to third-party water sales.
|
(2)
|
This amount represents the revenues associated with the Fayetteville Shale assets, which were sold on December 3, 2018. There were no Fayetteville Shale revenues in the first half of 2019.
|
|
Six months ended June 30,
|
||||||||||||||
(in millions except percentages)
|
Natural
Gas |
|
Oil
|
|
NGLs
|
|
Total
|
||||||||
2018 sales revenues (1)
|
$
|
935
|
|
|
$
|
78
|
|
|
$
|
140
|
|
|
$
|
1,153
|
|
Changes associated with the Fayetteville Shale sale (2)
|
(291
|
)
|
|
—
|
|
|
—
|
|
|
(291
|
)
|
||||
2018 sales revenues, net of Fayetteville Shale revenues
|
644
|
|
|
78
|
|
|
140
|
|
|
862
|
|
||||
Changes associated with prices
|
(22
|
)
|
|
(19
|
)
|
|
(32
|
)
|
|
(73
|
)
|
||||
Changes associated with production volumes
|
66
|
|
|
26
|
|
|
31
|
|
|
123
|
|
||||
2019 sales revenues (3)
|
$
|
688
|
|
|
$
|
85
|
|
|
$
|
139
|
|
|
$
|
912
|
|
Increase (decrease) from 2018, net of Fayetteville Shale revenues
|
7
|
%
|
|
9
|
%
|
|
(1
|
)%
|
|
6
|
%
|
(1)
|
Excludes $4 million in other operating revenues for the six months ended June 30, 2018 related to third-party water sales.
|
(2)
|
This amount represents the revenues associated with the Fayetteville Shale assets, which were sold on December 3, 2018. There were no Fayetteville Shale revenues in the first half of 2019.
|
(3)
|
Excludes $1 million in other operating revenues for the six months ended June 30, 2019 related to third-party water sales.
|
|
For the three months ended June 30,
|
|
Increase/(Decrease)
|
|
For the six months ended June 30,
|
|
Increase/(Decrease)
|
||||||||
Production volumes:
|
2019
|
|
2018
|
|
|
2019
|
|
2018
|
|
||||||
Natural Gas (Bcf)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Northeast Appalachia
|
113
|
|
|
112
|
|
|
1%
|
|
225
|
|
|
220
|
|
|
2%
|
Southwest Appalachia
|
35
|
|
|
22
|
|
|
59%
|
|
66
|
|
|
44
|
|
|
50%
|
Fayetteville Shale (1)
|
—
|
|
|
67
|
|
|
(100%)
|
|
—
|
|
|
134
|
|
|
(100%)
|
Total
|
148
|
|
|
201
|
|
|
(26%)
|
|
291
|
|
|
398
|
|
|
(27%)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Oil (MBbls)
|
|
|
|
|
|
|
|
|
|
|
|
||||
Southwest Appalachia
|
931
|
|
|
707
|
|
|
32%
|
|
1,780
|
|
|
1,301
|
|
|
37%
|
Other
|
6
|
|
|
16
|
|
|
(63%)
|
|
11
|
|
|
35
|
|
|
(69%)
|
Total
|
937
|
|
|
723
|
|
|
30%
|
|
1,791
|
|
|
1,336
|
|
|
34%
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
NGL (MBbls)
|
|
|
|
|
|
|
|
|
|
|
|
||||
Southwest Appalachia
|
5,493
|
|
|
4,850
|
|
|
13%
|
|
11,095
|
|
|
9,068
|
|
|
22%
|
Other
|
4
|
|
|
12
|
|
|
(67%)
|
|
5
|
|
|
24
|
|
|
(79%)
|
Total
|
5,497
|
|
|
4,862
|
|
|
13%
|
|
11,100
|
|
|
9,092
|
|
|
22%
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Production volumes by area: (Bcfe)
|
|
|
|
|
|
|
|
|
|
|
|
||||
Northeast Appalachia
|
113
|
|
|
112
|
|
|
1%
|
|
225
|
|
|
220
|
|
|
2%
|
Southwest Appalachia
|
73
|
|
|
55
|
|
|
33%
|
|
143
|
|
|
106
|
|
|
35%
|
Fayetteville Shale (1)
|
—
|
|
|
67
|
|
|
(100%)
|
|
—
|
|
|
134
|
|
|
(100%)
|
Total
|
186
|
|
|
234
|
|
|
(21%)
|
|
368
|
|
|
460
|
|
|
(20%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Production percentage: (Bcfe)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Natural gas
|
79
|
%
|
|
86
|
%
|
|
|
|
79
|
%
|
|
86
|
%
|
|
|
Oil
|
3
|
%
|
|
2
|
%
|
|
|
|
3
|
%
|
|
2
|
%
|
|
|
NGL
|
18
|
%
|
|
12
|
%
|
|
|
|
18
|
%
|
|
12
|
%
|
|
|
Total
|
100
|
%
|
|
100
|
%
|
|
|
|
100
|
%
|
|
100
|
%
|
|
|
(1)
|
The Fayetteville Shale assets were sold on December 3, 2018.
|
•
|
E&P segment production volumes for the second quarter of 2018 included 67 Bcf of production related to our operations in the Fayetteville Shale, which was sold in December 2018. Excluding this amount, production volumes for our E&P segment increased by 19 Bcfe for the three months ended June 30, 2019 compared to the same period in 2018, primarily due to a 33% increase in production volumes from Southwest Appalachia.
|
•
|
E&P segment production volumes for the six months ended June 30, 2018 included 134 Bcf of production related to our operations in the Fayetteville Shale, which was sold in December 2018. Excluding this amount, production volumes for our E&P segment increased by 42 Bcfe for the six months ended June 30, 2019 compared to the same period in 2018, primarily due to a 35% increase in production volumes from Southwest Appalachia.
|
•
|
Oil and NGL production increased 30% and 13%, respectively, for the three months ended June 30, 2019, compared to the same period in 2018, reflecting our shifting commodity production mix towards liquids.
|
•
|
Oil and NGL production increased 34% and 22%, respectively, for the six months ended June 30, 2019, compared to the same period in 2018.
|
|
For the three months ended June 30,
|
|
Increase/(Decrease)
|
|
For the six months ended June 30,
|
|
Increase/(Decrease)
|
||||||||||||
|
2019
|
|
2018
|
|
|
2019
|
|
2018
|
|
||||||||||
Natural Gas Price:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
NYMEX Henry Hub Price ($/MMBtu) (1)
|
$
|
2.64
|
|
|
$
|
2.80
|
|
|
(6)%
|
|
$
|
2.89
|
|
|
$
|
2.90
|
|
|
—%
|
Discount to NYMEX (2)
|
(0.84
|
)
|
|
(0.81
|
)
|
|
4%
|
|
(0.52
|
)
|
|
(0.55
|
)
|
|
(5%)
|
||||
Average realized gas price per Mcf, excluding derivatives
|
$
|
1.80
|
|
|
$
|
1.99
|
|
|
(10)%
|
|
$
|
2.37
|
|
|
$
|
2.35
|
|
|
1%
|
Loss on settled financial basis derivatives ($/Mcf)
|
(0.03
|
)
|
|
(0.01
|
)
|
|
|
|
(0.03
|
)
|
|
(0.06
|
)
|
|
|
||||
Gain on settled commodity derivatives ($/Mcf)
|
0.17
|
|
|
0.13
|
|
|
|
|
0.04
|
|
|
0.10
|
|
|
|
||||
Average realized gas price per Mcf, including derivatives
|
$
|
1.94
|
|
|
$
|
2.11
|
|
|
(8)%
|
|
$
|
2.38
|
|
|
$
|
2.39
|
|
|
—%
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Oil Price:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
WTI oil price ($/Bbl)
|
$
|
59.81
|
|
|
$
|
67.88
|
|
|
(12%)
|
|
$
|
57.36
|
|
|
$
|
65.37
|
|
|
(12%)
|
Discount to WTI
|
(10.26
|
)
|
|
(7.73
|
)
|
|
33%
|
|
(9.75
|
)
|
|
(7.12
|
)
|
|
37%
|
||||
Average oil price per Bbl, excluding derivatives
|
$
|
49.55
|
|
|
$
|
60.15
|
|
|
(18%)
|
|
$
|
47.61
|
|
|
$
|
58.25
|
|
|
(18%)
|
Gain (loss) on settled derivatives ($/Bbl)
|
2.05
|
|
|
(0.93
|
)
|
|
|
|
2.19
|
|
|
(0.51
|
)
|
|
|
||||
Average oil price per Bbl, including derivatives
|
$
|
51.60
|
|
|
$
|
59.22
|
|
|
(13%)
|
|
$
|
49.80
|
|
|
$
|
57.74
|
|
|
(14%)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
NGL Price:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Average net realized NGL price per Bbl, excluding derivatives
|
$
|
10.51
|
|
|
$
|
15.37
|
|
|
(32%)
|
|
$
|
12.50
|
|
|
$
|
15.39
|
|
|
(19%)
|
Gain (loss) on settled derivatives ($/Bbl)
|
2.11
|
|
|
(0.32
|
)
|
|
|
|
1.34
|
|
|
(0.17
|
)
|
|
|
||||
Average net realized NGL price per Bbl, including derivatives
|
$
|
12.62
|
|
|
$
|
15.05
|
|
|
(16%)
|
|
$
|
13.84
|
|
|
$
|
15.22
|
|
|
(9%)
|
Percentage of WTI, excluding derivatives
|
18
|
%
|
|
23
|
%
|
|
|
|
22
|
%
|
|
24
|
%
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Total Weighted Average Realized Price:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Excluding derivatives ($/Mcfe)
|
$
|
1.99
|
|
|
$
|
2.21
|
|
|
(10)%
|
|
$
|
2.48
|
|
|
$
|
2.51
|
|
|
(1)%
|
Including derivatives ($/Mcfe)
|
$
|
2.17
|
|
|
$
|
2.30
|
|
|
(6)%
|
|
$
|
2.54
|
|
|
$
|
2.53
|
|
|
—%
|
(1)
|
Based on last day settlement prices from monthly futures contracts.
|
(2)
|
This discount includes a basis differential, a heating content adjustment, physical basis sales, third-party transportation charges and fuel charges, and excludes financial basis hedges.
|
|
Volume (Bcf)
|
|
Basis Differential
|
|||
Basis Swaps - Natural Gas
|
|
|
|
|||
2019
|
80
|
|
|
$
|
(0.45
|
)
|
2020
|
132
|
|
|
(0.34
|
)
|
|
2021
|
28
|
|
|
(0.51
|
)
|
|
Total
|
240
|
|
|
|
||
|
|
|
|
|||
Physical NYMEX Sales Arrangements - Natural Gas
|
|
|
|
|||
2019
|
134
|
|
|
$
|
(0.24
|
)
|
2020
|
103
|
|
|
(0.13
|
)
|
|
Total
|
237
|
|
|
|
|
Remaining
2019
|
|
Full Year
2020
|
|
Full Year
2021
|
|||
Natural gas (Bcf)
|
223
|
|
|
172
|
|
|
37
|
|
Oil (MBbls)
|
2,043
|
|
|
2,563
|
|
|
—
|
|
Propane (MBbls)
|
2,231
|
|
|
2,562
|
|
|
—
|
|
Ethane (MBbls)
|
1,858
|
|
|
732
|
|
|
—
|
|
Total financial protection on future production (Bcfe)
|
260
|
|
|
207
|
|
|
37
|
|
(1)
|
Includes post-production costs such as: gathering, processing, fractionation and compression.
|
(2)
|
Excludes $2 million and $5 million of restructuring charges for the three and six months ended June 30, 2019, respectively.
|
(3)
|
Excludes $15 million of restructuring charges and $7.9 million of legal settlement charges for the three and six months ended June 30, 2018.
|
(4)
|
Excludes $1 million of restructuring charges for the three and six months ended June 30, 2018.
|
•
|
Lease operating expenses per Mcfe decreased $0.01 for the three months ended June 30, 2019, compared to the same period of 2018, as a $0.02 per Mcfe decrease associated with the Fayetteville Shale sale, was partially offset by a $0.01 per Mcfe increase primarily related to a shift towards liquids production, which includes processing fees.
|
•
|
Lease operating expenses per Mcfe decreased $0.03 for the six months ended June 30, 2019, compared to the same period of 2018, primarily due to a $0.02 per Mcfe decrease associated with the Fayetteville Shale sale, and a $0.02 per Mcfe decrease primarily related to preventative maintenance associated with extended severe winter weather along with a one-time charge of $3.7 million related to NGL processing fees, both recorded in the first quarter of 2018. These decreases were partially offset by a $0.01 per Mcfe increase primarily related to a shift towards liquids production, which includes processing fees.
|
•
|
General and administrative expenses decreased $18 million and $32 million for the three and six months ended June 30, 2019, respectively, compared to the same periods of 2018, primarily due to decreased personnel costs, the implementation of cost reduction initiatives and a $7.9 million legal settlement charge recorded in the second quarter of 2018.
|
•
|
On a per Mcfe basis, taxes, other than income taxes, may vary from period to period due to changes in ad valorem and severance taxes that result from the mix of our production volumes and fluctuations in commodity prices. Taxes, other than income taxes, increased $0.03 for the three and six months ended June 30, 2019, compared to the same periods of 2018, primarily due to an $8 million severance tax refund received in the second quarter of 2018.
|
•
|
Our full cost pool amortization rate increased $0.08 per Mcfe for the three and six months ended June 30, 2019, respectively, as compared to the same periods of 2018. The average amortization rate increased primarily as a result of the impact of capital investment and the further evaluation of our unproved properties during the past twelve months and the impact of the Fayetteville Shale sale, which reduced our total natural gas reserves along with the carrying value of our full cost pool assets.
|
•
|
The amortization rate is impacted by the timing and amount of reserve additions and the costs associated with those additions, revisions of previous reserve estimates due to both price and well performance, write-downs that result from full cost ceiling impairments, proceeds from the sale of properties that reduce the full cost pool, and the levels of costs subject to amortization. We cannot predict our future full cost pool amortization rate with accuracy due to the variability of each of the factors discussed above, as well as other factors, including but not limited to the uncertainty of the amount of future reserve changes.
|
•
|
Unevaluated costs excluded from amortization were $1.7 billion at June 30, 2019, compared to $1.8 billion at December 31, 2018. The unevaluated costs excluded from amortization decreased as the impact of $151 million of unevaluated capital invested during the period was more than offset by the evaluation of previously unevaluated properties totaling $229 million.
|
|
For the three months ended June 30,
|
|
Increase/
(Decrease)
|
|
For the six months ended June 30,
|
|
Increase/
(Decrease) |
||||||||||||
(in millions except percentages)
|
2019
|
|
2018
|
|
|
2019
|
|
2018
|
|
||||||||||
Marketing revenues
|
$
|
626
|
|
|
$
|
728
|
|
|
(14)%
|
|
$
|
1,566
|
|
|
$
|
1,557
|
|
|
1%
|
Gas gathering revenues
|
—
|
|
(1)
|
69
|
|
|
(100%)
|
|
—
|
|
(1)
|
136
|
|
|
(100%)
|
||||
Other operating revenues
|
—
|
|
|
—
|
|
|
—%
|
|
1
|
|
|
—
|
|
|
100%
|
||||
Marketing purchases
|
622
|
|
|
716
|
|
|
(13)%
|
|
1,556
|
|
|
1,535
|
|
|
1%
|
||||
Operating costs and expenses
|
9
|
|
(1)
|
54
|
|
(2)
|
(83%)
|
|
13
|
|
(1)
|
115
|
|
(3)
|
(89%)
|
||||
(Gain) loss on sale of operating assets
|
3
|
|
|
—
|
|
|
100%
|
|
3
|
|
|
(1
|
)
|
|
(400%)
|
||||
Operating income (loss)
|
$
|
(8
|
)
|
|
$
|
27
|
|
|
(130%)
|
|
$
|
(5
|
)
|
|
$
|
44
|
|
|
(111%)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Volumes marketed (Bcfe)
|
255
|
|
(4)
|
289
|
|
|
(12)%
|
|
544
|
|
(4)
|
554
|
|
|
(2)%
|
||||
Volumes gathered (Bcf)
|
—
|
|
(1)
|
106
|
|
|
(100%)
|
|
—
|
|
(1)
|
209
|
|
|
(100%)
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Percent natural gas marketed from affiliated E&P operations
|
83
|
%
|
(4)
|
94
|
%
|
|
|
|
75
|
%
|
(4)
|
95
|
%
|
|
|
||||
Affiliated E&P oil and NGL production marketed
|
76
|
%
|
|
69
|
%
|
|
|
|
75
|
%
|
|
68
|
%
|
|
|
(1)
|
Reflects the sale of our Fayetteville Shale-related gathering business, which was sold in December 2018.
|
(2)
|
Includes $2 million of restructuring charges for the three months ended June 30, 2018.
|
(3)
|
Includes $10 million impairment related to certain non-core gathering assets and $2 million of restructuring charges for the six months ended June 30, 2018.
|
(4)
|
Includes the effect of the purchase and sale of a portion of the production from the buyer of the Fayetteville Shale, which was sold in December 2018.
|
•
|
Midstream operating income for the second quarter of 2018 includes $20 million related to our gathering operations in the Fayetteville Shale, which were sold in December 2018. Excluding this amount, operating income decreased $15 million for the three months ended June 30, 2019, compared to the same period in 2018, primarily due to an $8 million decrease in the marketing margin, a $3 million loss on sale of operating assets and a $2 million increase in allocated corporate expenses.
|
•
|
Midstream operating income for the six months ended June 30, 2018 includes $42 million related to our gathering operations in the Fayetteville Shale, which we sold in December 2018. Excluding this amount, operating income decreased $7 million for the six months ended June 30, 2019, compared to the same period in 2018, primarily due to a $12 million decrease in the marketing margin, a $3 million loss on sale of operating assets and a $2 million increase in allocated corporate expenses, partially offset by a $1 million gain on storage gas and a $10 million impairment of non-core gathering assets in 2018.
|
•
|
The margin generated from marketing activities was $4 million and $12 million for the three months ended June 30, 2019 and 2018, respectively, and $10 million and $22 million for the six months ended June 30, 2019 and 2018, respectively.
|
•
|
Revenues from our marketing activities decreased $102 million for the three months ended June 30, 2019, compared to the same period in 2018, primarily due to a 12% decrease in volumes marketed and a 3% decrease in the price received for volumes marketed.
|
•
|
For the six months ended June 30, 2019, revenues from our marketing activities increased $9 million compared to the same period in 2018, as a 10 Bcfe decrease in the volumes marketed was more than offset by a 2% increase in the price received for volumes marketed.
|
•
|
Midstream operating costs and expenses for the second quarter of 2018 included $48 million related to our gathering operations in the Fayetteville Shale, which were sold in December 2018. Excluding this amount, operating costs and expenses increased $3 million for the three months ended June 30, 2019, compared to the same period in 2018, primarily due to a $2 million increase in allocated corporate costs.
|
•
|
Midstream operating costs and expenses for the first half of 2018 included $92 million related to our gathering operations in the Fayetteville Shale, which were sold in December 2018. Excluding this amount, operating costs and expenses decreased $10 million for the six months ended June 30, 2019, compared to the same period in 2018, primarily due to a $10 million impairment of non-core gathering assets, which were divested in 2018, along with $2 million of operating expenses associated with the related assets, partially offset by a $2 million increase in allocated corporate costs.
|
|
For the three months ended June 30,
|
|
Increase/(Decrease)
|
|
For the six months ended June 30,
|
|
Increase/(Decrease)
|
||||||||||||
(in millions except percentages)
|
2019
|
|
2018
|
|
|
2019
|
|
2018
|
|
||||||||||
Gross interest expense:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Senior notes
|
$
|
39
|
|
|
$
|
51
|
|
|
(24%)
|
|
$
|
78
|
|
|
$
|
101
|
|
|
(23%)
|
Credit arrangements
|
2
|
|
|
8
|
|
|
(75%)
|
|
5
|
|
|
23
|
|
|
(78%)
|
||||
Amortization of debt costs
|
2
|
|
|
2
|
|
|
—%
|
|
3
|
|
|
4
|
|
|
(25%)
|
||||
Total gross interest expense
|
43
|
|
|
61
|
|
|
(30%)
|
|
86
|
|
|
128
|
|
|
(33%)
|
||||
Less: capitalization
|
(28
|
)
|
|
(29
|
)
|
|
(3)%
|
|
(57
|
)
|
|
(57
|
)
|
|
—%
|
||||
Net interest expense
|
$
|
15
|
|
|
$
|
32
|
|
|
(53%)
|
|
$
|
29
|
|
|
$
|
71
|
|
|
(59%)
|
•
|
Interest expense related to our senior notes decreased for the three and six months ended June 30, 2019, compared to the same periods of 2018, as we repurchased $900 million of our outstanding senior notes in December 2018 with a portion of the proceeds from the Fayetteville Shale sale. Additionally, S&P and Moody’s upgraded our public bond ratings in April and May 2018, respectively, which lowered the interest rates associated with our Senior Notes due 2020 and 2025 by 50 basis points, effective in July 2018.
|
•
|
Interest expense related to our credit arrangements decreased for the three and six months ended June 30, 2019, as compared to the same periods of 2018, primarily due to the extinguishment of our 2016 term loan and entering into our revolving credit facility in April 2018, which decreased our outstanding borrowing amount, and the repayment of our revolving credit facility borrowings with a portion of the net proceeds from the Fayetteville Shale sale.
|
•
|
Capitalized interest decreased for the three months ended June 30, 2019, compared to the same period in 2018, due to the evaluation of natural gas and oil properties over the past twelve months.
|
•
|
Capitalized interest remained flat for the six months ended June 30, 2019, compared to the same period in 2018, as an increase in our average cost of debt was offset by the evaluation of natural gas and oil properties over the past twelve months.
|
•
|
Capitalized interest increased as a percentage of gross interest expense for the three and six months ended June 30, 2019, compared to the same periods in 2018, primarily due to an increase in our average cost of debt.
|
|
For the three months ended June 30,
|
|
For the six months ended June 30,
|
||||||||||||
(in millions)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Gain (loss) on unsettled derivatives
|
$
|
118
|
|
|
$
|
(56
|
)
|
|
$
|
96
|
|
|
$
|
(54
|
)
|
Gain on settled derivatives
|
34
|
|
|
20
|
|
|
24
|
|
|
11
|
|
||||
Gain (loss) on derivatives
|
$
|
152
|
|
|
$
|
(36
|
)
|
|
$
|
120
|
|
|
$
|
(43
|
)
|
|
For the three months ended June 30,
|
|
For the six months ended June 30,
|
||||||||||||
(in millions except percentages)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Income tax (benefit) expense
|
$
|
15
|
|
|
$
|
—
|
|
|
$
|
(411
|
)
|
|
$
|
—
|
|
Effective tax rate
|
10
|
%
|
|
0
|
%
|
|
(128
|
%)
|
|
0
|
%
|
•
|
As of the first quarter of 2019, we had sustained a three-year cumulative level of profitability. Based on this factor and other positive evidence such as forecasted income, we concluded that it is more likely than not that the deferred tax assets would be realized and released substantially all of the valuation allowance. This resulted in a discrete tax benefit of $411 million being recorded in the first half of 2019. We expect to retain a valuation allowance of $87 million related to net operating losses in jurisdictions in which we no longer operate.
|
•
|
Our low effective tax rate in 2018 was the result of our recognition of a valuation allowance that reduced the deferred tax asset primarily related to our current net operating loss carryforward. A valuation allowance for deferred tax assets, including net operating losses, is recognized when it is more likely than not that some or all of the benefit from the deferred tax asset will not be realized.
|
|
For the six months ended June 30,
|
||||||
(in millions)
|
2019
|
|
2018
|
||||
Net cash provided by operating activities
|
$
|
543
|
|
|
$
|
664
|
|
Net cash used in investing activities
|
(560
|
)
|
|
(675
|
)
|
||
Net cash used in financing activities
|
(29
|
)
|
|
(868
|
)
|
|
For the six months ended June 30,
|
||||||
(in millions)
|
2019
|
|
2018
|
||||
Net cash provided by operating activities
|
$
|
543
|
|
|
$
|
664
|
|
Less: Changes in working capital
|
(66
|
)
|
|
(44
|
)
|
||
Net cash provided by operating activities, net of changes in working capital
|
$
|
477
|
|
|
$
|
620
|
|
•
|
Net cash provided by operating activities decreased 18%, or $121 million, for the six months ended June 30, 2019, compared to the same period in 2018, primarily due to a $191 million decrease as a result of the December 2018 Fayetteville Shale sale and a $73 million decrease resulting from lower commodity prices. These decreases were partially offset by an $83 million increase associated with increased production, a $41 million increase as a result of reduced interest costs and a $22 million change in working capital.
|
•
|
Net cash generated from operating activities, net of changes in working capital, provided 69% of our cash requirements for capital investments for the six months ended June 30, 2019, compared to providing 84% of our cash requirements for capital investments for the same period in 2018. While we front-load our capital programs into the earlier quarters in the year, we remain committed to our capital discipline strategy of investing within our cash flow from operations, net of changes in working capital, supplemented by a portion of the net proceeds from the Fayetteville Shale sale.
|
•
|
Total E&P capital investing decreased $29 million for the three months ended June 30, 2019, compared to the same period in 2018, due to a $22 million decrease in direct E&P capital investing and a $7 million decrease in capitalized interest and internal costs, as compared to the same period in 2018.
|
•
|
Total E&P capital investing decreased $38 million for the six months ended June 30, 2019, compared to the same period in 2018, due to a $27 million decrease in direct E&P capital investing and a $11 million decrease in capitalized interest and internal costs, as compared to the same period in 2018.
|
|
For the six months ended June 30,
|
||||||
(in millions)
|
2019
|
|
2018
|
||||
Cash Flows from Investing Activities
|
|
|
|
||||
Additions to properties and equipment
|
$
|
586
|
|
|
$
|
684
|
|
Adjustments for capital investments
|
|
|
|
||||
Changes in capital accruals
|
105
|
|
|
52
|
|
||
Other
|
2
|
|
|
5
|
|
||
Total capital investing
|
$
|
693
|
|
|
$
|
741
|
|
|
For the three months ended June 30,
|
|
Increase/(Decrease)
|
|
For the six months ended June 30,
|
|
Increase/(Decrease)
|
||||||||||||
(in millions except percentages)
|
2019
|
|
2018
|
|
|
2019
|
|
2018
|
|
||||||||||
E&P capital investing
|
$
|
367
|
|
|
$
|
396
|
|
|
(7%)
|
|
$
|
692
|
|
|
$
|
730
|
|
|
(5%)
|
Midstream capital investing (1)
|
—
|
|
|
5
|
|
|
(100%)
|
|
—
|
|
|
9
|
|
|
(100%)
|
||||
Other capital investing
|
1
|
|
|
2
|
|
|
(50)%
|
|
1
|
|
|
2
|
|
|
(50)%
|
||||
Total capital investing
|
$
|
368
|
|
|
$
|
403
|
|
|
(9%)
|
|
$
|
693
|
|
|
$
|
741
|
|
|
(6%)
|
(1)
|
Our Midstream gathering business in the Fayetteville Shale was sold in December 2018.
|
|
For the three months ended June 30,
|
|
For the six months ended June 30,
|
||||||||||||
(in millions)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
E&P Capital Investments by Type:
|
|
|
|
|
|
|
|
|
|
||||||
Exploratory and development drilling, including workovers
|
$
|
284
|
|
|
$
|
311
|
|
|
$
|
535
|
|
|
$
|
566
|
|
Acquisitions of properties
|
16
|
|
|
16
|
|
|
23
|
|
|
36
|
|
||||
Seismic expenditures
|
1
|
|
|
1
|
|
|
2
|
|
|
2
|
|
||||
Water infrastructure project
|
11
|
|
|
—
|
|
|
26
|
|
|
13
|
|
||||
Drilling rigs and other
|
9
|
|
|
15
|
|
|
11
|
|
|
7
|
|
||||
Capitalized interest and expenses
|
46
|
|
|
53
|
|
|
95
|
|
|
106
|
|
||||
Total E&P capital investments
|
$
|
367
|
|
|
$
|
396
|
|
|
$
|
692
|
|
|
$
|
730
|
|
|
|
|
|
|
|
|
|
|
|
||||||
E&P Capital Investments by Area:
|
|
|
|
|
|
|
|
|
|
||||||
Northeast Appalachia
|
$
|
126
|
|
|
$
|
149
|
|
|
$
|
232
|
|
|
$
|
260
|
|
Southwest Appalachia
|
223
|
|
|
220
|
|
|
421
|
|
|
422
|
|
||||
Fayetteville Shale
|
—
|
|
|
10
|
|
|
—
|
|
|
25
|
|
||||
New Ventures & Other (1)
|
18
|
|
|
17
|
|
|
39
|
|
|
23
|
|
||||
Total E&P capital investments
|
$
|
367
|
|
|
$
|
396
|
|
|
$
|
692
|
|
|
$
|
730
|
|
(1)
|
Includes $11 million and $26 million for the three and six months ended June 30, 2019, respectively, and $13 million for the six months ended June 30, 2018 related to our water infrastructure project.
|
|
For the three months ended June 30,
|
|
For the six months ended June 30,
|
||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||
Gross Operated Well Count Summary:
|
|
|
|
|
|
|
|
|
|
||
Drilled
|
41
|
|
|
37
|
|
|
71
|
|
|
69
|
|
Completed
|
40
|
|
|
56
|
|
|
71
|
|
|
85
|
|
Wells to sales
|
36
|
|
|
45
|
|
|
55
|
|
|
78
|
|
(in millions except percentages)
|
June 30, 2019
|
|
December 31, 2018
|
|
Increase/(Decrease)
|
||||||
Debt (1)
|
$
|
2,319
|
|
|
$
|
2,318
|
|
|
$
|
1
|
|
Equity
|
3,082
|
|
|
2,362
|
|
|
720
|
|
|||
Total debt to capitalization ratio
|
43
|
%
|
|
50
|
%
|
|
|
||||
|
|
|
|
|
|
||||||
Debt (1)
|
$
|
2,319
|
|
|
$
|
2,318
|
|
|
$
|
1
|
|
Less: Cash and cash equivalents
|
155
|
|
|
201
|
|
|
(46
|
)
|
|||
Debt, net of cash and cash equivalents (2)
|
$
|
2,164
|
|
|
$
|
2,117
|
|
|
$
|
47
|
|
(1)
|
The increase in total debt as of June 30, 2019, as compared to December 31, 2018, relates to the amortization of financing costs during the first half of 2019.
|
(2)
|
Debt, net of cash and cash equivalents is a non-GAAP financial measure of a company’s ability to repay its debt if it was all due today.
|
•
|
We had negative working capital of $148 million at June 30, 2019, a $258 million decrease from December 31, 2018, as decreases of $223 million in accounts receivable, as compared to December 2018, related to lower commodity prices, a current liability of $47 million recorded in 2019 related to the implementation of the new lease accounting standard (Topic 842) and $52 million of our long-term debt, which matures in less than a year, being reclassified as a current liability in 2019 were only partially offset by positive changes in the current mark-to-market value of our derivative position, as compared to December 31, 2018.
|
•
|
At December 31, 2018, we had positive working capital of $110 million primarily due to $201 million of cash and cash equivalents resulting from the net proceeds from the Fayetteville Shale sale and an increase in accounts receivable primarily related to the increase in commodity pricing in December 2018, as compared to December 2017.
|
|
Payments Due by Period
|
||||||||||||||||||||||
(in millions)
|
Total
|
|
Less than 1 Year
|
|
1 to 3 Years
|
|
3 to 5 Years
|
|
5 to 8 years
|
|
More than 8 Years
|
||||||||||||
Infrastructure currently in service
|
$
|
7,501
|
|
|
$
|
702
|
|
|
$
|
1,304
|
|
|
$
|
1,097
|
|
|
$
|
1,511
|
|
|
$
|
2,887
|
|
Pending regulatory approval and/or construction (1)
|
966
|
|
|
9
|
|
|
78
|
|
|
121
|
|
|
196
|
|
|
562
|
|
||||||
Total transportation charges
|
$
|
8,467
|
|
|
$
|
711
|
|
|
$
|
1,382
|
|
|
$
|
1,218
|
|
|
$
|
1,707
|
|
|
$
|
3,449
|
|
(1)
|
Based on the estimated in-service dates as of June 30, 2019.
|
|
Expected Maturity Date
|
|
||||||||||||||||||||||||||
($ in millions)
|
2019
|
|
2020
|
|
2021
|
|
2022
|
|
2023
|
|
Thereafter
|
|
Total
|
|
||||||||||||||
Fixed rate payments (1)
|
$
|
—
|
|
|
$
|
52
|
|
|
$
|
—
|
|
|
$
|
213
|
|
|
$
|
—
|
|
|
$
|
2,077
|
|
|
$
|
2,342
|
|
|
Weighted average interest rate
|
—
|
%
|
|
5.30
|
%
|
|
—
|
%
|
|
4.10
|
%
|
|
—
|
%
|
|
6.98
|
%
|
|
6.68
|
%
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Variable rate payments (1)
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
(1)
|
$
|
—
|
|
|
$
|
—
|
|
(1)
|
Weighted average interest rate
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|
3.88
|
%
|
|
—
|
%
|
|
3.88
|
%
|
|
(1)
|
Excludes unamortized debt issuance costs and debt discounts.
|
|
|
|
SOUTHWESTERN ENERGY COMPANY
|
|
|
|
Registrant
|
|
|
|
|
Dated:
|
August 6, 2019
|
|
/s/ JULIAN M. BOTT
|
|
|
|
Julian M. Bott
Executive Vice President and
Chief Financial Officer
|
___
|
in a lump sum on the later of the 7th month following the Director’s separation from service or the January immediately following the calendar year in which the Director has a Separation from Service; or
|
___
|
in ______ annual installments (not to exceed five), beginning on the later of the 7th month following the Director’s separation from service or the January immediately following the calendar year in which the Director has a Separation from Service.
|
___
|
all of the stock shall be distributed on the later of the 7th month following the Director’s separation from service or the January immediately following the calendar year in which the Director has a Separation from Service; or
|
___
|
the stock shall be distributed in ______ annual installments (not to exceed ten), beginning on the later of the 7th month following the Director’s separation from service or the January immediately following the calendar year in which the Director has a Separation from Service.
|
NAME & ADDRESS
|
RELATIONSHIP
|
PERCENTAGE
|
_______________________
_______________________
_______________________
|
____________________
|
_________________
|
NAME & ADDRESS
|
RELATIONSHIP
|
PERCENTAGE
|
_______________________
_______________________
_______________________
|
____________________
|
_________________
|
Date:
|
August 6, 2019
|
|
/s/ WILLIAM J. WAY
|
|
|
|
|
William J. Way
|
|
|
|
|
Director, President and Chief Executive Officer
|
Date:
|
August 6, 2019
|
|
/s/ JULIAN M. BOTT
|
|
|
|
|
Julian M. Bott
|
|
|
|
|
Executive Vice President and Chief Financial Officer
|
Dated: August 6, 2019
|
|
/s/ WILLIAM J. WAY
|
|
|
William J. Way
|
|
|
Director, President and Chief Executive Officer
|
|
|
|
Dated: August 6, 2019
|
|
/s/ JULIAN M. BOTT
|
|
|
Julian M. Bott
|
|
|
Executive Vice President and Chief Financial Officer
|
|
|
|
Operation (1)
|
|
Section
104
S&S
Citations
|
|
Section
104(b)
Orders
|
|
Section
104(d)
Citations
and
Orders
|
|
Section
110(b)(2)
Violations
|
|
Section
107(a)
Orders
|
|
Section
107(a)
Orders
|
|
Total Dollar
Value of
Proposed
MSHA
Assessments (2)
|
|
Total Number of Mining Related
Fatalities
|
|
Received Notice of Pattern of Violations Under Section 104(e)
|
|
Received Notice of Potential to Have Pattern Under Section 104(e)
|
|
Legal
Actions
Pending
as of the
Last Day of
Period
|
|
Legal
Actions
Initiated
During
Period
|
|
Legal Actions
Resolved
During
Period
|
A. W. Realty Company, LLC
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
$—
|
|
—
|
|
|
|
|
|
—
|
|
—
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$—
|
|
|
|
No
|
|
No
|
|
|
|
|
|
|
(1)
|
The definition of mine under section 3 of the Mine Act includes the mine, as well as other items used in, or to be used in, or resulting from, the work of extracting minerals, such as land, structures, facilities, equipment, machines, tools, and preparation facilities. Unless otherwise indicated, any of these other items associated with a single mine have been aggregated in the totals for that mine.
|
(2)
|
The whole-dollar amounts included are the total dollar value of all proposed or outstanding assessments, regardless of classification, received from MSHA on or before June 30, 2019 regardless of whether the assessment has been challenged or appealed, for alleged violations occurring during the three month period ended June 30, 2019. Citations and orders can be contested and appealed, and as part of that process, are sometimes reduced in severity and amount, and are sometimes dismissed. The number of citations, orders, and proposed assessments vary by inspector and also vary depending on the size and type of the operation.
|