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Asset Retirement Obligations

9 Months Ended

Dec. 31, 2012

Asset Retirement Obligation Disclosure [Abstract]

The Company’s asset retirement obligations (“ARO”) relate to the plugging of wells, the removal of facilities and equipment, and site restoration on oil and gas properties. The fair value of a liability for an ARO is recorded in the period in which it is incurred, discounted to its present value using the credit adjusted risk-free interest rate, and a corresponding amount capitalized by increasing the carrying amount of the related long-lived asset. The liability is accreted each period, and the capitalized cost is depreciated over the useful life of the related asset.

The following table provides a rollforward of the AROs for the first nine months of fiscal 2013:

Carrying amount of asset retirement obligations as of April 1, 2012	$ 663,279
Liabilities incurred	103,890
Liabilities settled	(447)
Accretion expense	28,822
Carrying amount of asset retirement obligations as of December 31, 2012	795,544
Less: Current portion	50,000
Non-Current asset retirement obligation	$ 745,544

The ARO is included on the consolidated balance sheets with the current portion being included in the accounts payable and other accrued expenses.

- Definition

The entire disclosure for an asset retirement obligation and the associated long-lived asset. An asset retirement obligation is a legal obligation associated with the disposal or retirement from service of a tangible long-lived asset that results from the acquisition, construction or development, or the normal operations of a long-lived asset, except for certain obligations of lessees.

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