Note 8 - Asset Retirement Obligations

9 Months Ended

Sep. 30, 2022

Notes to Financial Statements

Asset Retirement Obligation Disclosure [Text Block]

NOTE 8. Asset Retirement Obligations

The Company’s asset retirement obligations primarily relate to the future plugging and abandonment of wells and related facilities. Market risk premiums associated with asset retirement obligations are estimated to represent a component of the Company’s credit-adjusted risk-free rate that is utilized in the calculations of asset retirement obligations.

Asset retirement obligations activity is as follows (in thousands):

	Nine Months Ended September 30, 2022
Beginning asset retirement obligations	$	4,260
Liabilities incurred from wells acquired		3,219
Liabilities incurred from new wells		528
Accretion of discount		245
Ending asset retirement obligations	$	8,252

As of September 30, 2022 and December 31, 2021, all asset retirement obligations are considered noncurrent and classified as such in the accompanying consolidated balance sheets.