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Derivative Instruments | 9 Months Ended
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Sep. 30, 2018
Derivative Instruments |
Derivatives instruments | Note 9—Derivative Instruments Forward exchange contracts—At September 30, 2018, we held undesignated forward exchange contracts, extending through June 2019, with an aggregate notional payment amount of $113 million and an aggregate notional receive amount of NOK 900 million, representing a weighted average exchange rate of NOK 7.96 to $1. In the three and nine months ended September 30, 2018, we recognized a loss of $3 million, recorded in other, net, associated with the forward exchange contracts. At September 30, 2018, the undesignated forward exchange contracts represented a liability with a carrying amount of $2 million, recorded in other current liabilities. In connection with the Songa acquisition, we acquired certain undesignated forward exchange contracts that extended through May 2018 and represented an economic hedge to reduce the variability of cash expenditures denominated in Norwegian kroner. On the acquisition date, the aggregate fair value of the forward exchange contracts represented an asset of $4 million. During the nine months ended September 30, 2018, we settled the remaining forward exchange contracts upon expiration. In the nine months ended September 30, 2018, we recognized a loss of $1 million, recorded in other, net, associated with the forward exchange contracts. Interest rate swaps—In connection with the Songa acquisition, we acquired interest rate swaps, which were previously designated but no longer qualified as a cash flow hedge, to reduce the variability of cash interest payments associated with the variable rate borrowings under the Senior Secured Term Loans, which we repaid in the three months ended September 30, 2018. On the acquisition date, the aggregate fair value of the interest rate swaps represented an asset of $14 million. In July and August 2018, we received aggregate cash proceeds of $18 million in connection with the settlement and termination of the interest rate swaps. In the three and nine months ended September 30, 2018, we recognized a loss of $1 million and a gain of $4 million, respectively, recorded in other, net, associated the interest rate swaps. Currency swaps—In connection with the Songa acquisition, we acquired currency swaps, which were previously designated as a cash flow hedge, to reduce the variability of cash interest payments and the final cash principal payment associated with the Bond Loans resulting from the changes in the U.S. dollar to Norwegian krone exchange rate. On the acquisition date, the aggregate fair value of the currency swaps represented a liability of $81 million. In February 2018, we made an aggregate cash payment of $92 million in connection with the settlement and termination of the currency swaps. In the nine months ended September 30, 2018, we recognized a loss of $11 million, recorded in other, net., associated with the currency swaps.

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- Definition The entire disclosure for derivative instruments and hedging activities including, but not limited to, risk management strategies, non-hedging derivative instruments, assets, liabilities, revenue and expenses, and methodologies and assumptions used in determining the amounts. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -URI http://asc.fasb.org/topic&trid=2229140 + Details
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