ASSET RETIREMENT OBLIGATIONS

9 Months Ended

Sep. 30, 2015

ASSET RETIREMENT OBLIGATIONS [Abstract]

Note 9: Asset Retirement Obligations

Asset retirement obligations (AROs) are legal obligations associated with the retirement of long-lived assets resulting from the acquisition, construction, development and/or normal use of the underlying assets.

Recognition of a liability for an ARO is required in the period in which it is incurred at its estimated fair value. The associated asset retirement costs are capitalized as part of the carrying amount of the underlying asset and depreciated over the estimated useful life of the asset. The liability is accreted through charges to operating expenses. If the ARO is settled for other than the carrying amount of the liability, we recognize a gain or loss on settlement.

We record all AROs for which we have legal obligations for land reclamation at estimated fair value. Essentially all these AROs relate to our underlying land parcels, including both owned properties and mineral leases. For the three and nine month periods ended September 30, we recognized ARO operating costs related to accretion of the liabilities and depreciation of the assets as follows:



	Three Months Ended		Nine Months Ended
	September 30			September 30
in thousands	2015	2014		2015	2014
ARO Operating Costs
Accretion	$ 2,766	$ 2,892		$ 8,553	$ 8,745
Depreciation	1,681	1,080		4,683	3,060
Total	$ 4,447	$ 3,972		$ 13,236	$ 11,805

ARO operating costs are reported in cost of revenues. AROs are reported within other noncurrent liabilities in our accompanying Condensed Consolidated Balance Sheets.

Reconciliations of the carrying amounts of our AROs are as follows:



	Three Months Ended		Nine Months Ended
	September 30			September 30
in thousands	2015	2014		2015	2014
Asset Retirement Obligations
Balance at beginning of period	$ 234,919	$ 225,117		$ 226,565	$ 228,234
Liabilities incurred	0	3,604		6,159	3,604
Liabilities settled	(5,318)	(7,684)		(13,318)	(20,527)
Accretion expense	2,766	2,892		8,553	8,745
Revisions up, net	2,313	4,539		6,721	8,412
Balance at end of period	$ 234,680	$ 228,468		$ 234,680	$ 228,468

The net revisions relate to revised cost estimates and spending patterns for several quarries located primarily in California.