Asset Retirement Obligations

6 Months Ended

Jun. 30, 2013

Asset Retirement Obligation [Abstract]

QEP records asset retirement obligations (ARO) when there are legal obligations associated with the retirement of tangible long-lived assets. The Company’s ARO liability applies primarily to abandonment costs associated with oil and gas wells, production facilities, midstream assets and certain other properties. The fair values of such costs are estimated by Company personnel based on abandonment costs of similar assets and depreciated over the life of the related assets. Revisions to ARO estimates result from changes in expected cash flows or material changes in estimated asset retirement costs. The ARO liability is adjusted to present value each period through an accretion calculation using a credit-adjusted risk-free interest rate.

The following is a reconciliation of the changes in the Company's asset retirement obligation from January 1, 2013, to June 30, 2013:



	Asset Retirement Obligations
	2013
	(in millions)
ARO liability at January 1,	$	193.1
Accretion	7.7
Liabilities incurred	6.9
Revisions	(16.5		)
Liabilities settled	(9.8		)
ARO liability at June 30,	$	181.4

- Definition

The entire disclosure for an asset retirement obligation and the associated long-lived asset. An asset retirement obligation is a legal obligation associated with the disposal or retirement from service of a tangible long-lived asset that results from the acquisition, construction or development, or the normal operations of a long-lived asset, except for certain obligations of lessees.

+ References+ Details