Asset Retirement Obligations

12 Months Ended

Dec. 31, 2021

Asset Retirement Obligation Disclosure [Abstract]

8. Asset Retirement Obligations

The following table describes the changes in our asset retirement obligations for the years ended December 31:


	2021		2020

	(In millions)
Balance at January 1	$	999	$	1,024
Liabilities incurred	229		36
Liabilities settled or disposed of	(207)		(161)
Accretion expense	44		46
Revisions of estimated liabilities	126		52
Foreign currency remeasurement	(1)		2
Balance at December 31	$	1,190	$	999

Total Asset Retirement Obligations at December 31:
Current portion of asset retirement obligations	$	185	$	105
Long-term asset retirement obligations	1,005		894
Total at December 31	$	1,190	$	999

The liabilities incurred in 2021 on Hess owned properties primarily relate to operations in the U.S. and Guyana while liabilities incurred in 2020 primarily relate to operations in Guyana, the U.S. and Malaysia. In August 2020, Fieldwood and related entities filed for bankruptcy relief under Chapter 11 of the U.S. Bankruptcy Code. Fieldwood’s Bankruptcy Plan, which was approved by the U.S. Bankruptcy Court in June 2021, includes the abandonment of certain assets, including seven offshore Gulf of Mexico leases and related facilities in the West Delta Field that were formerly owned by us and sold to a Fieldwood predecessor in 2004, and the discharge of Fieldwood’s obligation to decommission these facilities. As a result, in October 2021 and February 2022, we received decommissioning orders from the BSEE requiring us to decommission certain wells and related facilities located on six of the seven West Delta leases. We expect to receive additional orders covering the remainder of the West Delta decommissioning obligations in the near future and are actively engaged with the BSEE to agree on the scope and timing of decommissioning activities. Our decommissioning obligation derives from our former ownership of the facilities. We are seeking contribution from other parties that owned an interest in the facilities. Liabilities incurred in 2021 include $147 million representing total estimated abandonment obligations in the West Delta Field. Potential recoveries from other parties that previously owned an interest in the West Delta Field have not been recognized as of December 31, 2021.

The liabilities settled or disposed of in 2021 primarily result from the sale of our interests in Denmark and abandonment activity completed in the Gulf of Mexico and the Bakken. Liabilities settled or disposed of in 2020 primarily result from an asset sale in the Gulf of Mexico and abandonment activity completed in the Gulf of Mexico, the Bakken and the U.K. North Sea. Revisions of estimated liabilities in 2021 and 2020 primarily reflect an acceleration of planned abandonment activity in the Gulf of Mexico and changes in service and equipment rates.

Sinking fund deposits that are legally restricted for purposes of settling asset retirement obligations, which are reported in non-current Other assets in the Consolidated Balance Sheet, were $233 million at December 31, 2021 (2020: $207 million).