Annual report pursuant to Section 13 and 15(d)

Asset Retirement Obligations

v2.4.0.6
Asset Retirement Obligations
 12 Months Ended
Jun. 30, 2012
Asset Retirement Obligation Disclosure [Abstract]  
Asset Retirement Obligations
Note 4 - Asset Retirement Obligations
The estimated valuation of asset retirement obligations ("AROs") are based on management's historical experience and best estimate of plugging and abandonment costs by field. Assumptions and judgments by management include determination of the existence of a legal obligation for an ARO; estimated probabilities, amounts, and timing of settlements; the credit-adjusted risk-free rate to be used; and inflation rates. Accretion expense is recorded under depletion, depreciation, amortization, and accretion in the consolidated statement of operations.
The following table summarizes the asset retirement obligation activity for the years ended:
 
June 30,
 
2012
 
2011
 
(In thousands)
Balance at beginning of year
$
11,397

 
$
9,292

Liabilities assumed
3,035

 
—

Liabilities incurred
398

 
50

Accretion expense
568

 
564

Sale of assets
(6,773
)
 
—

Revision to estimate
(603
)
 
(129
)
Effect of exchange rate changes
(238
)
 
1,620

Balance at end of year
7,784

 
11,397

Less current asset retirement obligation
329

 
—

Long term asset retirement obligation
$
7,455

 
$
11,397