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Asset Retirement Obligations
9 Months Ended
Dec. 31, 2024
Asset Retirement Obligation Disclosure [Abstract]  
Asset Retirement Obligations

3. Asset Retirement Obligations

 

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 until the liability is settled or the well is sold, at which time the liability is removed. The related asset retirement cost is capitalized as part of the carrying amount of our oil and natural gas properties. The ARO is included in the consolidated balance sheets with the current portion being included in the accounts payable and other accrued expenses.

 

 

The following table provides a rollforward of the AROs for the first nine months of fiscal 2025:

 

      
Carrying amount of asset retirement obligations as of April 1, 2024  $718,808 
Liabilities incurred   3,631 
Liabilities settled   (33,607)
Accretion expense   23,229 
Carrying amount of asset retirement obligations as of December 31, 2024   712,061 
Less: Current portion   30,000 
Non-Current asset retirement obligation  $682,061