NOTE C. Exploratory Well Costs

The Company's capitalized exploratory well and project costs are presented in proved properties in the consolidated balance sheets. If the exploratory well or project is determined to be impaired, the impaired costs are charged to exploration and abandonments expense.

The following table reflects the Company's capitalized exploratory well and project activity during each of the years ended December 31, 2011, 2010 and 2009:


	Year Ended December 31,
	2011			2010			2009
	(in thousands)
Beginning capitalized exploratory well costs	$	96,193		$	127,574		$	124,014
Additions to exploratory well costs pending the determination of proved reserves		524,313			238,905			80,222
Reclassification due to determination of proved reserves		(480,716	)		(160,879	)		(58,792	)
Disposition of assets sold		(28,938	)		(17,601	)		—
Exploratory well costs charged to exploration expense (a)		(3,256	)		(91,806	)		(17,870	)

Ending capitalized exploratory well costs	$	107,596		$	96,193		$	127,574

(a)	Includes an exploratory well credit included in discontinued operations of $117 thousand in 2010, and exploratory well costs included in discontinued operations of $9.9 million in 2009.

During the fourth quarter of 2010, the Company determined that further appraisal drilling in its Cosmopolitan Unit in the Cook Inlet of Alaska would not be funded based on the project's limited impact to the Company's future Alaskan and overall growth profile. As a result, an exploration and abandonment charge of $97.7 million was recorded in the fourth quarter of 2010 to write off the Cosmopolitan project's carrying value. Included in the write off was suspended well costs of $76.0 million, $14.3 million of acreage costs, $6.4 million of estimated property abandonment costs and $1.0 million of inventory impairment charges to reduce the carrying value of its pipe inventory to its resale value.

The following table provides an aging, as of December 31, 2011, 2010 and 2009 of capitalized exploratory costs and the number of projects for which exploratory well costs have been capitalized for a period greater than one year, based on the date drilling was completed:


	Year Ended December 31,
	2011		2010		2009
	(in thousands, except well counts)
Capitalized exploratory well costs that have been suspended:
One year or less	$	107,596	$	70,635	$	21,634
More than one year		—		25,558		105,940

	$	107,596	$	96,193	$	127,574

Number of projects with exploratory well costs that have been suspended for a period greater than one year		—		3		8