Asset Retirement Obligations

12 Months Ended

Dec. 31, 2016

Asset Retirement Obligations [Abstract]

Note H – Asset Retirement Obligations

The asset retirement obligations liabilities (ARO) recognized by the Company at December 31, 2016 and 2015 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 2016 and 2015 is shown in the following table.



(Thousands of dollars)	2016		2015
Balance at beginning of year	$	825,312	875,728
Accretion expense		46,742	48,665
Liabilities incurred		13,690	76,775
Revisions of previous estimates		(4,511)	(85,504)
Liabilities settled		(20,589)	(13,359)
Liabilities assumed by purchaser of oil and gas assets		(91,883)	(33,448)
Changes due to translation of foreign currencies		12,296	(43,545)
Balance at end of year		781,057	825,312
Liabilities reported as held for sale at end of year1		(85,900)	–
Current portion of liability at end of year2		(13,629)	(31,838)
Noncurrent portion of liability at end of year	$	681,528	793,474

1Liabilities held for sale related to Seal properties in Canada which were sold in January 2017.

2Included 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.