OIL AND NATURAL GAS PROPERTIES

9 Months Ended

Jun. 30, 2013

OIL AND NATURAL GAS PROPERTIES

OIL AND NATURAL GAS PROPERTIES

13.       OIL AND NATURAL GAS PROPERTIES

Under the full cost method of accounting, the Company performs quarterly ceiling test calculations. Barnwell’s net capitalized costs exceeded the ceiling limitations at March 31, 2013 and December 31, 2012. As such, Barnwell reduced the carrying value of its oil and natural gas properties by $4,506,000 during the nine months ended June 30, 2013. No such reduction was necessary during the three months ended June 30, 2013 or the three and nine months ended June 30, 2012. The reduction is included in the Condensed Consolidated Statements of Operations under the caption “Reduction of carrying value of assets.”