Note

Environmental and Reclamation Activities

The liabilities accrued for our reclamation and closure costs at

December

31,

2017

and

2016

were as follows (in thousands):

	2017			2016
Operating properties:
Greens Creek	$	41,677		$	39,014
Lucky Friday		9,911			9,194
Casa Berardi		6,729			5,475
San Sebastian		5,067			5,592
Non-operating properties:
Troy mine		12,724			16,167
Johnny M		5,813			5,830
Republic		1,500			1,500
All other sites		2,624			2,808
Total		86,045			85,580
Reclamation and closure costs, current		(6,679	)		(5,653	)
Reclamation and closure costs, long-term	$	79,366		$	79,927

The activity in our accrued reclamation and closure cost liability for the years ended

December

31,

2017,

2016

and

2015

was as follows (in thousands):

Balance at January 1, 2015	$	57,250
Accruals for estimated costs		15,114
Accretion expense		1,904
Revision of estimated cash flows due to changes in reclamation plans		4,112
Addition due to development and production at our San Sebastian unit		1,189
Liability addition due to acquisition of Revett		17,513
Payment of reclamation obligations		(1,544	)
Balance at December 31, 2015		95,538
Accruals for estimated costs		705
Accretion expense		3,158
Revision of estimated cash flows due to changes in reclamation plans		2,759
Liability addition due to acquisition of Mines Management		1,124
Payment of reclamation obligations		(17,704	)
Balance at December 31, 2016		85,580
Accruals for estimated costs		16
Accretion expense		4,870
Revision of estimated cash flows due to changes in reclamation plans		(578	)
Payment of reclamation obligations		(3,843	)
Balance at December 31, 2017	$	86,045

June 2015,

we completed the acquisition of Revett, giving us

100%

ownership of the Troy mine and other interests in northwestern Montana (see

Note

for more information). As a result, we recorded a

$17.5

million liability for the present value of estimated costs for reclamation and closure of the Troy mine. Revett held an environmental risk transfer program ("insurance policy") which would have funded costs incurred prior to the expiration date of

March 29, 2020

for reclamation at the Troy mine up to a maximum limit of

$16.8

million. In the

third

quarter of

2016,

we reached a settlement on the insurance policy for cash proceeds to us of

$16.0

million.

On each of

June 15, 2016

and

September 19, 2016,

a Consent Decree settling environmental claims involving our wholly-owned subsidiary, CoCa Mines, Inc. ("CoCa") at the Nelson Tunnel/Commodore Waste Rock Pile site (Colorado) and Gilt Edge site (South Dakota), respectively, was approved and entered by the U.S. District Court in Colorado and South Dakota, respectively. Pursuant to the Consent Decrees, CoCa paid an aggregate of

million in

August 2016

to the United States and the State of Colorado, and an aggregate of

$3.9

million in

November 2016

to the United States and the State of South Dakota (insurers and another potentially responsible party ("PRP") paid an additional

$6.7

million to settle the Gilt Edge matter). As a result, CoCa has resolved the claims with respect to the Gilt Edge and Nelson Tunnel sites. During the negotiations leading up to these settlements, in the

second

quarter of

2015

we accrued

$9.9

million by recording a liability for the total amount that would be paid by CoCa to settle these matters, and an asset for the amount to be recovered by CoCa from insurers and the other settling PRP with respect to the Gilt Edge site.

Asset Retirement Obligations

Below is a reconciliation as of

December

31,

2017

and

2016

(in thousands) of the asset retirement obligations ("ARO") relating to our operating properties, which are included in our total accrued reclamation and closure costs of

$86.0

million and

$85.6

million, respectively, discussed above. The estimated reclamation and abandonment costs were discounted using credit adjusted, risk-free interest rates ranging from

5.75%

14.5%

from the time we incurred the obligation to the time we expect to pay the retirement obligation.

	2017			2016
Balance January 1	$	59,275		$	53,433
Changes in obligations due to changes in reclamation plans		(578	)		2,760
Accretion expense		4,870			3,158
Payment of reclamation obligations		(183	)		(76	)
Balance at December 31	$	63,384		$	59,275

In the

fourth

quarter of

2017,

we updated the ARO at San Sebastian to include estimated costs for new underground mine development initiated in

2017

and to revise the timing for reclamation of the existing open pits, resulting in an increase in undiscounted costs of

$0.5

million and decrease in the ARO asset and liability of

$1.2

million.

In the

fourth

quarter of

2017,

we revised the ARO at Casa Berardi to include costs for reclamation related to the East Mine Crown Pillar open pit, resulting in an increase in undiscounted costs of

$1.0

million and increase in the ARO asset and liability of

$0.7

million.

The ARO layers related to the changes described above were discounted using a credit adjusted, risk-free interest rate of

5.75%

and inflation rates ranging from

4%.