AMAK Asset Retirement Obligations

12 Months Ended

Dec. 31, 2020

Schedule of Equity Method Investments [Line Items]

Asset Retirement Obligations

During 2012, we recorded an ARO for deferred mine closure costs of approximately SR12,843,000. These deferred mine closure costs are being amortized over the estimated life of the mine. Amortization expense was approximately SR362,000, SR541,000, and SR745,000 for the nine months ended September 30, 2020 and the years ended December 31, 2019 and 2018.


Deferred mine closure costs consisted of the following at:
	September 30,	December 31,
	2020	2019
Cost	12,842,625	12,842,625
Accumulated amortization	(7,993,376)	(7,631,120)

	4,849,249	5,211,505


A summary of changes in our provision for mine closure costs is as follows:
	September 30,	December 31,
	2020	2019	2018
Balance, beginning of period	16,625,347	16,063,136	15,519,938
Accretion expense	405,558	562,211	543,198

Balance, end of period	17,030,905	16,625,347	16,063,136

ARO costs may increase or decrease significantly in the future as a result of changes in regulations, changes in engineering designs and technology, permit modifications or updates, changes in mine plans, inflation or other factors and as actual reclamation spending occurs.