Quarterly report pursuant to Section 13 or 15(d)

Asset Retirement Obligations

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Asset Retirement Obligations
 9 Months Ended
Mar. 31, 2014
Asset Retirement Obligation Disclosure [Abstract]  
Asset Retirement Obligations
Note 6 - Asset Retirement Obligations
The estimated valuation of asset retirement obligations ("AROs") is based on the Company's historical experience and management's best estimate of plugging and abandonment costs by field. Assumptions and judgments made by management when assessing an ARO include: (i) the existence of a legal obligation; (ii) estimated probabilities, amounts, and timing of settlements; (iii) the credit-adjusted risk-free rate to be used; and (iv) inflation rates. Accretion expense is recorded under depletion, depreciation, amortization, and accretion in the unaudited condensed consolidated statements of operations. If the recorded value of ARO requires revision, the revision is recorded to both the ARO and the asset retirement capitalized cost. As a result of the sale of the Amadeus Basin assets on March 31, 2014, AROs were reduced by approximately $4.5 million.
The following table summarizes the ARO activity for the nine months ended March 31, 2014:
 
Total
 
(In thousands)
Fiscal year opening balance
$
6,879

Liabilities incurred
7

Liabilities sold
(4,457
)
Accretion expense
325

Effect of exchange rate changes
68

Balance at March 31, 2014
2,822

Less current asset retirement obligation
388

Long term asset retirement obligation
$
2,434