Asset Retirement Obligations Asset Retirement Obligations (Notes)

3 Months Ended

Mar. 31, 2017

Asset Retirement Obligation Disclosure [Abstract]

(9) Asset Retirement Obligations

Liabilities for legal obligations associated with the retirement obligations of tangible long-lived assets are initially recorded at fair value in the period in which they are incurred. When a liability is initially recorded, the carrying amount of the related 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 amortized 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 condensed consolidated balance sheets. This guidance requires us to record a liability for the fair value of our dismantlement and abandonment costs, excluding salvage values.

Upon the Company's emergence from bankruptcy on April 22, 2016, as discussed in Note 11, the Company applied fresh start accounting. This included adjusting the Asset Retirement Obligations based on the estimated fair values at April 22, 2016. The following provides a roll-forward of our asset retirement obligations for the three months ended March 31, 2017 (in thousands):



	2017
Asset Retirement Obligations recorded as of January 1	$	32,256
Accretion	564
Liabilities incurred for new wells and facilities construction	68
Reductions due to plugged wells and facilities	(1,456		)
Revisions in estimates	426
Asset Retirement Obligations as of March 31	$	31,858

At March 31, 2017 and December 31, 2016, approximately $9.0 million and $10.0 million of our asset retirement obligations were classified as a current liability in “Accounts payable and accrued liabilities” on the accompanying condensed consolidated balance sheets.