Note 8 - Asset Retirement Obligations

12 Months Ended

Dec. 31, 2023

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):

	Year Ended December 31,
	2023			2022			2021
Beginning asset retirement obligations	$	7,502		$	4,260		$	2,293
Liabilities incurred from new wells		445			573			980
Liabilities assumed in acquisitions		2,638			3,219			981
Liabilities divested		(81	)		—			(6	)
Dispositions		—			—			(25	)
Revision of estimates (a)		2,219			(920	)		(130	)
Accretion of discount		522			370			167
Ending asset retirement obligations	$	13,245		$	7,502		$	4,260

(a) The revisions to the Company’s asset retirement obligation estimates are primarily due to changes in the ultimate expected useful lives of the properties.

As of December 31, 2023 and 2022, all asset retirement obligations are considered noncurrent and classified as such in the accompanying consolidated balance sheets.