Asset Retirement Obligations

9 Months Ended

Sep. 30, 2011

Asset Retirement Obligations [Abstract]

NOTE 8 — ASSET RETIREMENT OBLIGATIONS

The Company records a liability for the fair value of an asset’s retirement obligation in the period in which it is incurred and the corresponding cost is capitalized by increasing the carrying amount of the related long-lived asset. The liability is accreted to its then present value each period, and the capitalized cost is depreciated over the estimated useful life of the related asset. We have included estimated future costs of abandonment and dismantlement in our successful efforts amortization base and amortize these costs as a component of our depreciation, depletion, and accretion expense in the accompanying consolidated financial statements.

The following table summarizes the Company’s asset retirement obligation transactions during the nine month period ended September 30, 2011:


	(in thousands)

Asset retirement obligation at beginning of period	$	4,455
Assumed in NGAS acquisition		8,678
Assumed in NuLoch acquisition		1,496
Liabilities incurred		103
Liabilities settled		(8	)
Accretion expense		618
Effect of foreign currency exchange		(115	)
Revisions in estimated liabilities		(25	)

Asset retirement obligation at end of period		15,202
Less: current portion		(495	)

Asset retirement obligation at end of period	$	14,707