Asset Retirement Obligations Asset Retirement Obligations (Notes)

12 Months Ended

Dec. 31, 2015

Asset Retirement Obligation Disclosure [Abstract]

We record these obligations in accordance with the guidance contained in FASB ASC 410-20. This guidance requires entities to record the fair value of a liability for legal obligations associated with the retirement obligations of tangible long-lived assets in the period in which it is incurred. When the liability is initially recorded, the carrying amount of the related long-lived asset is increased. The liability is discounted from the expected date of abandonment. Over time, accretion of the liability is recognized each period, and the capitalized cost is depreciated on a unit-of-production basis as part of depreciation, depletion, and amortization expense for our oil and gas properties. Upon settlement of the liability, the Company either settles the obligation for its recorded amount or incurs a gain or loss upon settlement which is included in the “Property and Equipment” balance on our accompanying consolidated balance sheets. This guidance requires us to record a liability for the fair value of our dismantlement and abandonment costs, excluding salvage values.

The following provides a roll-forward of our asset retirement obligations (in thousands):



Asset Retirement Obligations as of December 31, 2013	$	79,084
Accretion expense	5,712
Liabilities incurred for new wells and facilities construction	469
Reductions due to sold and abandoned wells and facilities	(8,253		)
Revisions in estimates	(4,181		)
Asset Retirement Obligations as of December 31, 2014	$	72,831
Accretion expense	5,572
Liabilities incurred for new wells and facilities construction	151
Reductions due to sold and abandoned wells and facilities	(4,576		)
Revisions in estimates	(10,423		)
Asset Retirement Obligations as of December 31, 2015	$	63,555

At December 31, 2015 and 2014, approximately $7.2 million and $10.7 million, respectively, of our asset retirement obligation was classified as a current liability in “Accounts payable and accrued liabilities” on the accompanying consolidated balance sheets. The decrease in 2015 is primarily attributable to revaluation changes due to changes in service costs driven by market conditions, which led to a decrease in the estimated plugging and abandonment costs for many our wells and facilities.