v3.21.2
Sales and Other Operating Revenues
 9 Months Ended
Sep. 30, 2021
Sales and Other Operating Revenues [Abstract]  
Sales and Other Operating Revenues
Note 17—Sales and Other Operating Revenues
Revenue from Contracts
 
with Customers
The following table provides further
 
disaggregation of our consolidated
 
sales and other operating revenues:
Millions of Dollars
 
Three Months Ended
Nine Months Ended
September 30
September 30
2021
2020
2021
2020
Revenue from contracts
 
with customers
$
8,880
3,078
23,794
9,908
Revenue from contracts
 
outside the scope of ASC Topic
 
606
Physical contracts
 
meeting the definition of a derivative
2,620
1,280
7,348
3,432
Financial derivative contracts
(174)
28
(434)
(47)
Consolidated sales and other operating
 
revenues
$
11,326
4,386
30,708
13,293
Revenues from contracts
 
outside the scope of ASC Topic
 
606 relate primarily to physical
 
gas contracts at market
prices which qualify as derivatives accounted
 
for under ASC Topic
 
815, “Derivatives and Hedging,”
 
and for which
we have not elected NPNS.
 
There is no significant difference
 
in contractual terms or the policy for
 
recognition of
revenue from these contracts
 
and those within the scope of ASC Topic
 
606.
 
The following disaggregation
 
of
revenues is provided in conjunction
 
with
Millions of Dollars
 
Three Months Ended
Nine Months Ended
September 30
September 30
2021
2020
2021
2020
Revenue from Outside the Scope of ASC Topic
 
606
by Segment
Lower 48
$
2,123
1,018
5,934
2,692
Canada
266
152
776
452
Europe, Middle East and North Africa
231
110
638
288
Physical contracts
 
meeting the definition of a derivative
$
2,620
1,280
7,348
3,432
Millions of Dollars
 
Three Months Ended
Nine Months Ended
September 30
September 30
2021
2020
2021
2020
Revenue from Outside the Scope of ASC Topic
 
606
by Product
Crude oil
$
215
100
517
218
Natural gas
2,192
1,042
6,423
2,895
Other
213
138
408
319
Physical contracts
 
meeting the definition of a derivative
$
2,620
1,280
7,348
3,432
Practical Expedients
Typically,
 
our commodity sales contracts are
 
less than 12 months in duration; however,
 
in certain specific cases
they may extend longer,
 
which may be out to the end of field life.
 
We have long-term commodity sales contracts
which use prevailing market prices at the time of delivery, and under these contracts, the market-based variable
consideration for each performance obligation (i.e., delivery of commodity) is allocated to each wholly unsatisfied
performance obligation within the contract.
 
Accordingly,
we have applied the practical expedient allowed in ASC
Topic 606 and do not disclose the aggregate amount of the transaction price allocated to performance obligations
or when we expect to recognize revenues that are unsatisfied (or partially unsatisfied) as of the end of the
reporting period.
Receivables and Contract
 
Liabilities
Receivables from Contracts
 
with Customers
At September 30, 2021, the “Accounts
 
and notes receivable” line on our consolidated
 
balance sheet, includes
trade receivables of $
4,262
 
million compared with $
1,827
 
million at December 31, 2020, and includes both
contracts with customers
 
within the scope of ASC Topic
 
606 and those that are outside the scope of ASC Topic
 
606.
 
We typically receive payment within 30 days or less (depending on the terms of the invoice) once delivery is made.
 
Revenues that are outside the scope
 
of ASC Topic 606 relate
 
primarily to physical gas sales contracts
 
at market
prices for which we do not elect NPNS and are
 
therefore accounted
 
for as a derivative under ASC Topic
 
815.
 
There
is little distinction in the nature of the customer
 
or credit quality of trade receivables
 
associated with gas sold
under contracts for which NPNS
 
has not been elected compared to trade
 
receivables where NPNS has been
elected.
Contract Liabilities from Contracts
 
with Customers
We have entered
 
into contractual arrangements
 
where we license proprietary technology
 
to customers related
 
to
the optimization process for
 
operating LNG plants.
 
The agreements typically provide for
 
negotiated payments to
be made at stated milestones.
 
The payments are not directly related
 
to our performance under the contract
 
and
are recorded as deferred
 
revenue to be recognized
 
as revenue when the customer can utilize
 
and benefit from
their right to use the license.
 
Payments are received in installments over the construction period.
Millions of Dollars
Contract Liabilities
At December 31, 2020
$
97
Contractual payments received
7
Revenue recognized
(62)
At September 30, 2021
$
42
Amounts Recognized in the Consolidated
 
Balance Sheet at September 30, 2021
Current liabilities
$
42
For the nine-month period of 2021, we recognized revenue of $62 million in the “Sales and other operating
revenues” line on our consolidated income statement. No revenue was recognized during the three-month period
ended September 30, 2021. We expect to recognize the contract liabilities as of September 30, 2021, as revenue
during 2022.