ASSET RETIREMENT OBLIGATION

12 Months Ended

Dec. 31, 2023

Asset Retirement Obligation Disclosure [Abstract]

The following table describes changes to the Company’s asset retirement obligation (ARO) liability for the years ended December 31, 2023 and 2022:


	For the Year Ended December 31,
	2023		2022

	(In millions)
Asset retirement obligation at beginning of the year	$	1,991	$	2,130
Liabilities incurred	12		4

Liabilities divested	—		(73)
Liabilities settled	(45)		(39)
Accretion expense	116		117
Revisions in estimated liabilities	356		(148)

Asset retirement obligation at end of the year	2,430		1,991
Less current portion	(76)		(55)
Asset retirement obligation, long-term	$	2,354	$	1,936

The ARO liability reflects the estimated present value of the amount of dismantlement, removal, site reclamation, and similar activities associated with the Company’s oil and gas properties and other long-lived assets. The Company utilizes current retirement costs to estimate the expected cash outflows for retirement obligations. The Company estimates the ultimate productive life of the properties, a risk-adjusted discount rate, and an inflation factor in order to determine the current present value of this obligation. To the extent future revisions to these assumptions impact the present value of the existing ARO liability, a corresponding adjustment is made to the oil and gas property or other long-lived asset balance.

During 2023 and 2022, the Company recorded $12 million and $4 million, respectively, in abandonment liabilities resulting from the Company’s exploration and development capital program. Liabilities settled primarily relate to individual properties, platforms, and facilities plugged and abandoned during the period. During 2023, net abandonment costs were revised upward by approximately $356 million, primarily reflecting changes in estimates of timing, activity costs, and foreign currency exchange rates on service costs in the North Sea. During 2022, net abandonment costs were revised downward by approximately $148 million to reflect changes in estimates of timing and foreign currency exchange rates on service costs, primarily in the North Sea, partially offset by an upward revision in the U.S.