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EMPLOYEE BENEFIT PLANS (Tables) | 12 Months Ended
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Dec. 31, 2023
Defined Benefit Plan [Abstract] |
Pension and Postretirement Benefit Plans Obligations and Fair Value of Plan Assets | The following table sets forth our retirement and other postretirement benefit plans benefit obligations and fair value of plan assets for the periods indicated:
|  | Retirement Benefits | Other Postretirement Benefits
|  | December 31, | December 31,
|  | 2023 |  | 2022 |  | 2023 |  | 2022
Change in benefit obligation |  | (Millions of dollars)
Benefit obligation, beginning of period |  | $ | 423 |  |  | $ | 567 |  |  | $ | 38 |  |  | $ | 51 |
Service cost |  | 7 |  |  | 7 |  |  | — |  |  | — |
Interest cost |  | 27 |  |  | 18 |  |  | 2 |  |  | 1 |
Plan participants’ contributions |  | — |  |  | — |  |  | 1 |  |  | 1 |
Actuarial (gain) loss |  | 38 |  |  | (149) |  |  | 3 |  |  | (11) |
Benefits paid |  | (33) |  |  | (20) |  |  | (4) |  |  | (4) |
Magellan Acquisition |  | 240 |  |  | — |  |  | 11 |  |  | — |
Benefit obligation, end of period (a) |  | 702 |  |  | 423 |  |  | 51 |  |  | 38 |
Change in plan assets |  |  |  |  |  |  |  |
Fair value of plan assets, beginning of period |  | 322 |  |  | 413 |  |  | 17 |  |  | 24 |
Actual return on plan assets |  | 60 |  |  | (71) |  |  | 2 |  |  | (4) |
Plan participants’ contributions |  | — |  |  | — |  |  | 1 |  |  | 1 |
Benefits paid |  | (33) |  |  | (20) |  |  | (4) |  |  | (4) |
Magellan Acquisition |  | 205 |  |  | — |  |  | — |  |  | — |
Fair value of plan assets, end of period (b) |  | 554 |  |  | 322 |  |  | 16 |  |  | 17 |
Balance at December 31 |  | $ | (148) |  |  | $ | (101) |  |  | $ | (35) |  |  | $ | (21) |
Current liabilities |  | $ | (5) |  |  | $ | (5) |  |  | $ | — |  |  | $ | — |
Noncurrent liabilities |  | (143) |  |  | (96) |  |  | (35) |  |  | (21) |
Balance at December 31 |  | $ | (148) |  |  | $ | (101) |  |  | $ | (35) |  |  | $ | (21) |
(a) - The benefit obligation for Retirement Benefits at December 31, 2023 and 2022, include the supplemental executive retirement plan obligation. (b) - Fair value of plan assets for Retirement Benefits exclude the assets of our supplemental executive retirement plan, which totaled $89 million and $92 million at December 31, 2023 and 2022, respectively, and are included in other assets on the Consolidated Balance Sheets. These assets are maintained in a rabbi trust and are not treated as assets of the supplemental executive retirement plan.
Weighted-Average Assumptions Used to Determine Benefit Obligations and Net Periodic Benefit Costs | The following table sets forth the weighted-average assumptions used to determine benefit obligations for retirement and other postretirement benefits for the periods indicated:
|  | Retirement Benefits | Other Postretirement Benefits
|  | December 31, | December 31,
|  | 2023 |  | 2022 |  | 2023 |  | 2022
Discount rate |  | 5.40% |  | 5.75% |  | 5.50% |  | 5.75%
Compensation increase rate |  | 3.65% |  | 3.60% |  | NA |  | NA
Interest credit rating (a) |  | 4.03% |  | NA |  | NA |  | NA
(a) - This actuarial assumption is only applicable to the pension plans assumed with the Magellan Acquisition.
Schedule of Allocation Plan Assets | The combined target allocation for the assets of our pension plans as of December 31, 2023, is as follows:
Domestic and international equities |  | 32 | %
Long duration fixed income |  | 56 | %
Return-seeking credit |  | 4 | %
Hedge funds |  | 5 | %
Real estate funds |  | 3 | %
Total |  | 100 | %
As part of our risk management for the plans, minimums and maximums have been set for each of the asset classes listed above. The fair value of the plan assets for our other postretirement benefit plans as of December 31, 2023 are not material. The following tables set forth the plan assets by fair value category as of the measurement date for our defined benefit pension plans:
|  | Pension Benefits
|  | December 31, 2023
Asset Category |  | Level 1 |  | Level 2 |  | Level 3 |  | Subtotal |  | Measured at NAV (d) |  | Total
|  | (Millions of dollars)
Investments: |  |  |  |  |  |  |  |  |  |  |  |
Equity securities |  | $ | 65 |  |  | $ | — |  |  | $ | — |  |  | $ | 65 |  |  | $ | — |  |  | $ | 65 |
Cash and money market funds |  | 9 |  |  | — |  |  | — |  |  | 9 |  |  | — |  |  | 9 |
Government obligations |  | 45 |  |  | — |  |  | — |  |  | 45 |  |  | — |  |  | 45 |
Corporate obligations |  | 100 |  |  | — |  |  | — |  |  | 100 |  |  | — |  |  | 100 |
Common/collective trusts |  |  |  |  |  |  |  |  |  |  |  |
Equity securities (a) |  | — |  |  | — |  |  | — |  |  | — |  |  | 109 |  |  | 109 |
Real estate funds |  | — |  |  | — |  |  | — |  |  | — |  |  | 17 |  |  | 17 |
Government obligations |  | — |  |  | — |  |  | — |  |  | — |  |  | 60 |  |  | 60 |
Corporate obligations (b) |  | — |  |  | — |  |  | — |  |  | — |  |  | 114 |  |  | 114 |
Short-term investments |  | — |  |  | — |  |  | — |  |  | — |  |  | 6 |  |  | 6 |
Other investments (c) |  | — |  |  | — |  |  | — |  |  | — |  |  | 29 |  |  | 29 |
Fair value of plan assets |  | $ | 219 |  |  | $ | — |  |  | $ | — |  |  | $ | 219 |  |  | $ | 335 |  |  | $ | 554 |
(a) - This category represents securities of the respective market sector from diverse industries. (b) - This category represents bonds from diverse industries. (c) - This category represents alternative investments in limited partnerships, which can be redeemed with a 30-day notice with no further restrictions. There are no unfunded capital commitments. These limited partnerships invest through multi-strategy programs in broadly diversified portfolios of private investment funds, hedge funds and/or separate accounts to seek equity-like returns with low market correlation, reduced volatility and limited risk. (d) - Plan asset investments measured at fair value using the net asset value per share.
|  | Pension Benefits
|  | December 31, 2022
Asset Category |  | Level 1 |  | Level 2 |  | Level 3 |  | Subtotal |  | Measured at NAV (d) |  | Total
|  | (Millions of dollars)
Investments: |  |  |  |  |  |  |  |  |  |  |  |
Common/collective trusts |  |  |  |  |  |  |  |  |  |  |  |
Equity securities (a) |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 100 |  |  | $ | 100 |
Real estate funds |  | — |  |  | — |  |  | — |  |  | — |  |  | 26 |  |  | 26 |
Government obligations |  | — |  |  | — |  |  | — |  |  | — |  |  | 57 |  |  | 57 |
Corporate obligations (b) |  | — |  |  | — |  |  | — |  |  | — |  |  | 102 |  |  | 102 |
Short-term investments |  | — |  |  | — |  |  | — |  |  | — |  |  | 6 |  |  | 6 |
Other investments (c) |  | — |  |  | — |  |  | — |  |  | — |  |  | 31 |  |  | 31 |
Fair value of plan assets |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 322 |  |  | $ | 322 |
(a) - This category represents securities of the respective market sector from diverse industries. (b) - This category represents bonds from diverse industries. (c) - This category represents alternative investments in limited partnerships, which can be redeemed with a 30-day notice with no further restrictions. There are no unfunded capital commitments. These limited partnerships invest through multi-strategy programs in broadly diversified portfolios of private investment funds, hedge funds and/or separate accounts to seek equity-like returns with low market correlation, reduced volatility and limited risk. (d) - Plan asset investments measured at fair value using the net asset value per share.
Pension Benefits and Post Retirement Benefit Payments Expected to Be Paid | The following table sets forth the defined benefit pension and other postretirement benefits payments expected to be paid in 2024 through 2033:
|  | Pension Benefits |  | Other Postretirement Benefits
Benefits to be paid in: |  | (Millions of dollars)
2024 |  | $ | 39 |  |  | $ | 5 |
2025 |  | $ | 43 |  |  | $ | 5 |
2026 |  | $ | 45 |  |  | $ | 5 |
2027 |  | $ | 47 |  |  | $ | 4 |
2028 |  | $ | 47 |  |  | $ | 4 |
2029 through 2033 |  | $ | 267 |  |  | $ | 18 |

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- Definition Tabular disclosure of the major categories of plan assets of pension plans and/or other employee benefit plans. This information may include, but is not limited to, the target allocation of plan assets, the fair value of each major category of plan assets, and the level within the fair value hierarchy in which the fair value measurements fall. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 715 -SubTopic 20 -Subparagraph (d)(5) -Name Accounting Standards Codification -Paragraph 1 -Section 50 -Publisher FASB -URI https://asc.fasb.org//1943274/2147480506/715-20-50-1 + Details
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