Asset Retirement Obligations

9 Months Ended

Sep. 30, 2016

Asset Retirement Obligation Disclosure [Abstract]

Asset retirement obligations (ARO) consist primarily of estimated costs of dismantlement, removal, site reclamation and similar activities associated with our oil and gas properties. Changes in ARO are as follows:



	Nine Months Ended September 30,
(millions)	2016			2015
Asset Retirement Obligations, Beginning Balance	$	989		$	751
Liabilities Incurred	5			54
Liabilities Settled	(87		)	(29		)
Revision of Estimate	4			79
Accretion Expense ⁽¹⁾	37			32
Asset Retirement Obligations, Ending Balance	$	948		$	887


⁽¹⁾	Accretion expense is included in Depreciation, Depletion and Amortization (DD&A) expense in the consolidated statements of operations.

For the nine months ended September 30, 2016 Liabilities incurred were due to new wells and facilities placed into service for onshore US and deepwater Gulf of Mexico. Liabilities settled were related to wells and facilities permanently abandoned at the end of their useful life and primarily included activities for Gulf of Mexico of $42 million and onshore US of $40 million.

For the nine months ended September 30, 2015 Liabilities incurred were due to new wells and facilities for onshore US and deepwater Gulf of Mexico as well as liabilities assumed in the Rosetta Merger. Liabilities settled primarily related to non-core, onshore US properties sold.

Revisions were primarily due to changes in estimated costs for future abandonment activities and acceleration of timing of abandonment and included $43 million for Eastern Mediterranean and $28 million for DJ Basin.