ASSET RETIREMENT OBLIGATIONS

12 Months Ended

Dec. 31, 2015

19.ASSET RETIREMENT OBLIGATIONS

The liability for the expected cash flows as recognized in the financial statements reflected discount rates ranging from 1.7% to 9.4% (2014 - 4.6% to 8.1%). A reconciliation of movements in the Company’s ARO is as follows:

December 31,	2015		2014
(millions of Canadian dollars)
Obligations at beginning of year	185		24
Liabilities incurred	2		177
Liabilities settled	(45	)	(24	)
Change in estimate	30		-
Foreign currency translation adjustment	21		5
Accretion expense	5		3
Obligations at end of year	198		185
Presented as follows:
Accounts payable and other (Note 16)	9		53
Other long-term liabilities (Note 18)	189		132
	198		185

In 2014, the Company recognized ARO in the amount of $177 million. Of this amount, $74 million related to the decommissioning of certain portions of Line 6B of EEP’s Lakehead System and $103 million related to the Canadian and United States portions of the Line 3 Replacement Program, which is targeted to be completed in 2019, whereby the Company will replace the existing Line 3 pipeline in Canada and the United States.