PROPERTY, PLANT AND EQUIPMENT

12 Months Ended

Dec. 31, 2023

Property, Plant and Equipment [Abstract]

PROPERTY, PLANT AND EQUIPMENT

PROPERTY, PLANT AND EQUIPMENT

We capitalize the costs incurred to acquire or develop our oil and natural gas assets, including ARO and interest. For asset acquisitions, purchase price, including liabilities assumed, is allocated to acquired assets based on relative fair values at the acquisition date. We evaluate long-lived assets on a quarterly basis for possible impairment.

Property, plant and equipment, net consisted of the following:

	December 31, 2023		December 31, 2022
	(in millions)
Proved oil and natural gas properties	$	3,156	$	2,972
Unproved oil and natural gas properties	1		2
Facilities and other	280		254
Total property, plant and equipment	3,437		3,228
Accumulated depreciation, depletion and amortization	(667)		(442)
Total property, plant and equipment, net	$	2,770	$	2,786

The following table summarizes the activity of capitalized exploratory well costs:

	Year ended December 31,
(in millions)	2023		2022		2021
Beginning balance	$	1	$	1	$	3
Charged to expense	—		—		(2)
Ending balance	$	1	$	1	$	1

There are not significant exploratory well costs in the periods presented that have been capitalized for a period greater than one year after the completion of drilling. Our capitalized exploratory well costs at December 31, 2023 are for wells that we intend to drill.

Asset Impairments

In 2023, we recognized an impairment of $3 million related to properties acquired for our carbon management activities. The fair value, using Level 3 inputs in the fair value hierarchy, declined during the first quarter of 2023 due to market conditions (including inflation and rising interest rates).

We recognized an asset impairment of $2 million for the year ended December 31, 2022 related to a write-down of CRC Plaza, a commercial office building located in Bakersfield, California to fair value. In 2022, we sold CRC Plaza for $13 million. See Note 8 Divestitures and Acquisitions for further information regarding the sale of CRC Plaza.

Asset impairments were $28 million for the year ended December 31, 2021, including $25 million related to the write-down of CRC Plaza to fair value and a $3 million write-off of capitalized costs related to projects which were abandoned. We valued our commercial office building based on a market approach (using Level 3 inputs in the fair value hierarchy). The decline in commercial demand for office space of this size and type in that market at each assessment resulted in an impairment.