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APACHE CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) The expected long-term rate of return on assets assumptions are derived relative to the yield on long-dated fixed-interest bonds issued by the U.K. government (gilts). For equities, outperformance relative to gilts is assumed to be 3.5 percent per year. The following tables set forth the components of the net periodic cost and the underlying weighted average actuarial assumptions used for the pension and postretirement benefit plans as of December 31, 2015, 2014, and 2013: 2015 2014 2013 Pension Postretirement Pension Postretirement Pension Postretirement Benefits Benefits Benefits Benefits Benefits Benefits (In millions)

Component of Net Periodic Benefit Costs Service cost . . . . . . . . . . . . . . . . . . . . . . . $ Interest cost . . . . . . . . . . . . . . . . . . . . . . . Expected return on assets . . . . . . . . . . . . Amortization of actuarial (gain) loss . . . Curtailment (gain) loss . . . . . . . . . . . . . .

5 $ 8 (8) 2 -

2 1 -

$

5 $ 9 (11) 1 -

3 1 -

$

5 $ 7 (8) 2 -

4 1 (3)

Net periodic benefit cost . . . . . . . . . . . . . $

7 $

3

$

4 $

4

$

6 $

2

Weighted Average Assumptions used to determine Net Period Benefit Cost for the Years ended December 31 Discount rate . . . . . . . . . . . . . . . . . . . . . . Salary increases . . . . . . . . . . . . . . . . . . . Expected return on assets . . . . . . . . . . . . Healthcare cost trend . . . . . . . . . . . . . . . Initial . . . . . . . . . . . . . . . . . . . . . . . . . . Ultimate in 2025 . . . . . . . . . . . . . . . . .

3.70% 4.60% 3.90%

3.62% N/A N/A

4.60% 4.90% 5.60%

4.33% N/A N/A

4.30% 4.60% 4.70%

3.43% N/A N/A

N/A N/A

7.00% 5.00%

N/A N/A

7.00% 5.00%

N/A N/A

7.25% 5.00%

Assumed health care cost trend rates affect amounts reported for postretirement benefits. A one-percentagepoint change in assumed health care cost trend rates would have the following effects: Postretirement Benefits 1% Increase 1% Decrease (In millions)

Effect on service and interest cost components . . . . . . . . . . . . . . . . . . . . . . . . . . . Effect on postretirement benefit obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$

1 4

$

(1) (3)

Apache expects to contribute approximately $7 million to its pension plan and $2 million to its postretirement benefit plan in 2016. The following benefit payments, which reflect expected future service, as appropriate, are expected to be paid: Pension Benefits

Postretirement Benefits

(In millions)

2016 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2017 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2018 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2019 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2020 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Years 2021-2025 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-41

$

4 4 4 4 4 22

$

2 2 2 2 2 10

Apache 2015 Summary Annual Report  

Adapting to a changing environment

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