Asset Impairments

9 Months Ended

Sep. 30, 2015

5. Asset Impairments

The following table presents the asset impairments recognized by Devon in the first nine months of 2015.



	Three Months Ended September 30, 2015				Nine Months Ended September 30, 2015
	Gross		Net of Taxes		Gross		Net of Taxes

	(Millions)
U.S. oil and gas assets	$	4,715	$	2,994	$	14,340	$	9,105
Canada oil and gas assets		336		248		336		248
EnLink goodwill		576		576		576		576
EnLink other intangible assets		223		223		223		223
Other assets		1		1		4		3
Total asset impairments	$	5,851	$	4,042	$	15,479	$	10,155

Oil and Gas Impairments

Under the full cost method of accounting, capitalized costs of oil and gas properties, net of accumulated DD&A and deferred income taxes, may not exceed the full cost “ceiling” at the end of each quarter. The ceiling is calculated separately for each country and is based on the present value of estimated future net cash flows from proved oil and gas reserves, discounted at 10% per annum, net of related tax effects. Estimated future net cash flows are calculated using end-of-period costs and an unweighted arithmetic average of commodity prices in effect on the first day of each of the previous 12 months.

The oil and gas impairments resulted from declines in the U.S. and Canada full cost ceilings. The lower ceiling values resulted primarily from significant decreases in the 12-month average trailing prices for oil, bitumen, gas and NGLs, which significantly reduced proved reserves values and, to a lesser degree, proved reserves.

EnLink Goodwill and Other Intangible Assets Impairments

In the third quarter of 2015, Devon recognized goodwill and other intangible assets impairments related to EnLink’s business. Additional information regarding the impairments is discussed in Note 11.