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Asset Retirement Obligations
 12 Months Ended
Dec. 31, 2015
Asset Retirement Obligations [Abstract]  
Asset Retirement Obligations

Note H – Asset Retirement Obligations

 

The asset retirement obligations liabilities (ARO) recognized by the Company at December 31, 2015 and 2014 are related to the estimated costs to dismantle and abandon its producing oil and gas properties and related equipment.

 

A reconciliation of the beginning and ending aggregate carrying amount of the asset retirement obligation for 2015 and 2014 is shown in the following table.

 

 

 

 

 

 

 

 

 

 

 

 

(Thousands of dollars)

2015

 

2014

Balance at beginning of year

$

 875,728 

 

 880,003 

         Accretion expense

 

 48,665 

 

 50,778 

         Liabilities incurred

 

 76,775 

 

 70,568 

         Revisions of previous estimates

 

 (85,504)

 

 8,278 

         Liabilities settled

 

 (13,359)

 

 (36,818)

         Liabilities assumed by purchaser of oil and gas assets

 

 (33,448)

 

 (69,416)

         Changes due to translation of foreign currencies

 

 (43,545)

 

 (27,665)

                 Balance at end of year

 

 825,312 

 

 875,728 

         Current portion of liability at end of year*

 

 (31,838)

 

 (34,202)

                 Noncurrent portion of liability at end of year

$

 793,474 

 

 841,526 

 

*Included in Other Accrued Liabilities on the Consolidated Balance Sheet.

 

The estimation of future ARO is based on a number of assumptions requiring professional judgment.  The Company cannot predict the type of revisions to these assumptions that may be required in future periods due to the availability of additional information such as:  prices for oil field services, technological changes, governmental requirements and other factors.