Year Ended December 31, | |||||||||||
2013 | 2012 | 2011 | |||||||||
(in thousands) | |||||||||||
Beginning asset retirement obligations | $ | 197,754 | $ | 136,742 | $ | 152,291 | |||||
Obligations assumed in acquisitions | — | 10,498 | 6 | ||||||||
New wells placed on production | 5,775 | 9,593 | 9,233 | ||||||||
Changes in estimates (a) | 7,939 | 51,536 | 7,490 | ||||||||
Obligations reclassified to liabilities held for sale | (10,091 | ) | — | (29,892 | ) | ||||||
Disposition of wells | (6,083 | ) | (2,536 | ) | (448 | ) | |||||
Obligations settled | (13,953 | ) | (18,066 | ) | (12,880 | ) | |||||
Accretion of discount on continuing operations | 11,862 | 8,677 | 7,506 | ||||||||
Accretion of discount from integrated services (b) | 14 | 100 | — | ||||||||
Accretion of discount on discontinued operations | 831 | 1,210 | 3,436 | ||||||||
Ending asset retirement obligations | $ | 194,048 | $ | 197,754 | $ | 136,742 | |||||
(a) | The changes in the 2013, 2012 and 2011 estimates are primarily due to increases in abandonment cost estimates based on recent actual costs incurred to abandon wells and declines in credit-adjusted risk-free discount rates used to value increases in asset retirement obligations. The increases in 2013 and 2011 estimates were partially offset by higher commodity prices, which had the effect of lengthening the economic life of certain wells and decreasing the present value of future retirement obligations. The increase in the 2012 estimate was further impacted by declines in oil, NGL and gas prices used to calculate proved reserves, which had the effect of shortening the economic life of certain wells and increasing the present value of future retirement obligations. |
(b) | Accretion of discount from integrated services includes Premier Silica accretion expense, which is recorded as a reduction in income from vertical integration services in interest and other income in the Company's accompanying consolidated statements of operations. See Note M for more information about interest and other income. |