Asset Retirement Obligations

6 Months Ended

Jun. 30, 2011

Notes to Financial Statements [Abstract]

NOTE E - DECOMMISSIONING AND OTHER ASSET RETIREMENT OBLIGATIONS

The large majority of our asset retirement obligations consists of the future well abandonment and decommissioning costs for offshore oil and gas properties and platforms owned by our Maritech subsidiary, including the remaining abandonment, decommissioning, and debris removal costs associated with offshore platforms destroyed by hurricanes. The amount of decommissioning liabilities recorded by Maritech is reduced by amounts allocable to joint interest owners, anticipated insurance recoveries, and any contractual amount to be paid by the previous owner of the oil and gas property when the liabilities are satisfied.

The changes in the asset retirement obligations during the three month and six month periods ended June 30, 2011 and 2010 are as follows:

	Three Months Ended June 30,
	2011			2010
	(In Thousands)

Beginning balance as of March 31	$	230,834		$	236,418
Activity in the period:
Accretion of liability		1,264			1,350
Retirement obligations incurred		-			-
Revisions in estimated cash flows		16,045			4,902
Settlement of retirement obligations		(103,618	)		(26,523	)
Ending balance as of June 30	$	144,525		$	216,147

	Six Months Ended June 30,
	2011			2010
	(In Thousands)
Beginning balance as of December 31 of
the preceding year	$	272,815		$	224,110
Activity in the period:
Accretion of liability		3,158			2,698
Retirement obligations incurred		-			-
Revisions in estimated cash flows		25,809			22,184
Settlement of retirement obligations		(157,257	)		(32,845	)
Ending balance as of June 30	$	144,525		$	216,147

Revisions in estimated cash flows for the three months and six months ended June 30, 2011, are primarily related to the retained Maritech property assets. Settlements of retirement obligations during the three months and six months ended June 30, 2011, include approximately $72.7 million and $118.7 million, respectively, of obligations associated with oil and gas properties sold by Maritech during the periods. In August 2011, Maritech sold an additional oil and gas property, which will result in the further reduction of asset retirement obligations by an additional $3.3 million.