Reclamation and environmental costs are based principally on legal requirements. Management estimates costs associated with reclamation of mineral properties and properties under mine closure. On an ongoing basis the Company evaluates its estimates and assumptions; however, actual amounts could differ from those based on estimates and assumptions.

The Company has posted several cash bonds as financial security to satisfy reclamation requirements. The balance of posted cash reclamation bonds at March 31, 2022 is $498,276 (June 30, 2021 - $533,703).

Paramount is responsible for managing the reclamation activities from the previous mine operations at the Sleeper Gold Mine as directed by the BLM and the Nevada State Department of Environmental Protection (“NDEP”). Paramount has estimated the undiscounted reclamation costs for existing disturbances at the Sleeper Gold Project required by the BLM to be $3,557,944. These costs are expected to be incurred between the calendar years 2021 and 2060. Paramount has also estimated undiscounted reclamation cost as required by the NDEP to be $1,470,000. These costs include on-going monitoring and new requests from the NDEP to convert three processing ponds from the historical operations to evaporation cell ponds by 2023. On-going monitoring costs are expected to be incurred between 2022 and 2039. The sum of expected costs by year are discounted using the Company’s credit adjusted risk free interest rate from the time it expects to pay the retirement to the time it incurs the obligation. The asset retirement obligation for the Sleeper Gold Project recorded on the balance sheet is equal to the present value of the estimated reclamation costs as required by both the BLM and NDEP.

The following variables were used in the calculation for the periods ending March 31, 2022 and June 30, 2021:


	Nine-Months Ended March 31, 2022			Year Ended June 30, 2021
Weighted-average credit adjusted risk free rate		9.89	%		9.89	%
Weighted-average inflation rate		2.31	%		2.31	%

Changes to the Company’s asset retirement obligations for the Sleeper Gold Mine for the nine-month period ended March 31, 2022 and the year ended June 30, 2021 are as follows:


	Nine-Month Period Ended March 31, 2022			Year Ended June 30, 2021
Balance at beginning of period	$	1,849,644		$	615,170
Accretion expense		137,907			60,040
Additions and change in estimates		—			1,498,950
Settlements		(33,236	)		(324,516	)
Balance at end of period	$	1,954,315		$	1,849,644

The balance of the asset retirement obligation of $1,954,315 at March 31, 2022 (June 30, 2021 -$1,849,644 ) is comprised of a current portion of $294,786 (June 30, 2021 -$310,022 ) and a non-current portion of $1,659,529 (June 30, 2021 -$1,539,622). The Company recorded an accretion expense for the three and nine-month period ended March 31, 2022 of $45,969 and $137,907 (2021 - $15,010 and $45,030).