Goodwill

Changes in the amounts of our goodwill for each of the years ended December 31, 2017 and 2016 are summarized by reporting unit as follows (in millions):



	Natural Gas Pipelines Regulated			Natural Gas Pipelines Non-Regulated			CO2		Products Pipelines			Products Pipelines Terminals			Terminals			Kinder Morgan Canada			Total
Historical Goodwill	$	17,527		$	5,812		$	1,528	$	2,125		$	221		$	1,584		$	556		$	29,353
Accumulated impairment losses	(1,643		)	(1,597		)	—		(1,197		)	(70		)	(679		)	(377		)	(5,563		)
December 31, 2015	15,884			4,215			1,528		928			151			905			179			23,790
Currency translation	—			—			—		—			—			—			6			6
Divestitures(a)	(1,635		)	—			—		—			—			(9		)	—			(1,644		)
December 31, 2016	14,249			4,215			1,528		928			151			896			185			22,152
Currency translation	—			—			—		—			—			—			13			13
Divestitures(b)	—			—			—		—			—			(3		)	—			(3		)
December 31, 2017	$	14,249		$	4,215		$	1,528	$	928		$	151		$	893		$	198		$	22,162

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(a)	2016 includes $1,635 million related to the sale of a 50% interest in our SNG natural gas pipeline system by Natural Gas Pipelines Regulated to Southern Company and $9 million related to certain terminal divestitures.


(b)	2017 includes $3 million related to certain terminal divestitures.

Refer to Note 2 “Summary of Significant Accounting Policies—Goodwill” for a description of our accounting for goodwill and Note 4 “Impairments and Losses on Divestitures” for further discussion regarding impairments.

We determine the fair value of each reporting unit as of May 31 of each year based primarily on a market approach utilizing enterprise value to estimated EBITDA multiples of comparable companies. The value of each reporting unit is determined on a stand-alone basis from the perspective of a market participant representing the price estimated to be received in a sale of the reporting unit in an orderly transaction between market participants at the measurement date. For our Natural Gas Pipelines Non-Regulated reporting unit, our May 31, 2017 annual test included a discounted cash flow analysis (income approach) to evaluate the fair value of this reporting unit to provide additional indication of fair value based on the present value of cash flows this reporting unit is expected to generate in the future. We weighted the market and income approaches for this reporting unit to arrive at an estimated fair value of this reporting unit giving more weighting on the income approach and less on the market approach as we believed the value indicated using the income approach is more representative of the value that could be received from a market participant. As of May 31, 2017, each of our reporting units indicated a fair value in excess of their respective carrying values and step 2 was not required. The amount of excess fair value over the carrying value ranged from approximately 3% for our Natural Gas Pipelines Non-Regulated reporting unit to 89% for our Products Pipelines Terminals as of May 31, 2017. The results of our Step 1 analysis did not indicate an impairment of goodwill and we did not identify any triggers for further impairment analysis during the remainder of the year.

Due to the effect of commodity prices on market conditions that impacted the energy sector, during the fourth quarter 2015, we conducted an interim test of the recoverability of goodwill as of December 31, 2015, and concluded that the goodwill of our Natural Gas Pipelines - Non-Regulated reporting unit was impaired by $1.15 billion.

The fair value estimates of our reporting unit fair value, and in arriving at the fourth quarter 2015 impairment amount, were based on Level 3 inputs of the fair value hierarchy.

A continued period of volatile commodity prices could result in further deterioration of market multiples, comparable sales transactions prices, weighted average costs of capital, and our cash flow estimates. A significant unfavorable change to any one or combination of these factors would result in a change to the reporting unit fair values discussed above potentially resulting in additional impairments of long-lived assets, equity method investments, and/or goodwill. Such non-cash impairments could have a significant effect on our results of operations.