NOTE I – DECOMMISSIONING AND OTHER ASSET RETIREMENT OBLIGATIONS

The large majority of our asset retirement obligations consists of the remaining future well abandonment and decommissioning costs for offshore oil and gas properties and platforms owned by our Maritech subsidiary, including the decommissioning and debris removal costs associated with its remaining offshore platforms previously destroyed by hurricanes. The amount of decommissioning liabilities recorded by Maritech is reduced by amounts allocable to joint interest owners and any contractual amounts to be paid by the previous owners of the oil and gas properties when the liabilities are satisfied. We also operate facilities in various U.S. and foreign locations that are used in the manufacture, storage, and sale of our products, inventories, and equipment. These facilities are a combination of owned and leased assets. The value of our asset retirement obligations for non-Maritech properties was approximately $7.6 million and $7.5 million as of December 31, 2013 and 2012, respectively. We are required to take certain actions in connection with the retirement of these assets. We have reviewed our obligations in this regard in detail and estimated the cost of these actions. These estimates are the fair values that have been recorded for retiring these long-lived assets. The associated asset retirement costs are capitalized as part of the carrying amount of the long-lived asset. The costs for non-oil and gas assets are depreciated on a straight-line basis over the life of the asset.

The changes in the asset retirement obligations during the most recent two year period are as follows:



	Year Ended December 31,
	2013			2012
	(In Thousands)
Beginning balance for the period, as reported	$	94,921		$	139,835
Activity in the period:
Accretion of liability	673			1,536
Retirement obligations incurred	—			—
Revisions in estimated cash flows	74,946			40,986
Settlement of retirement obligations	(119,636		)	(87,436		)
Ending balance	$	50,904		$	94,921

We review the adequacy of our decommissioning liabilities whenever indicators suggest that the estimated cash flows underlying the liabilities have changed. For our Maritech segment, the timing and amounts of these cash flows are subject to changes in the energy industry environment and other factors and may result in additional liabilities to be recorded. During 2013 and 2012, we increased the estimated cash flows to decommission these properties by approximately $75.0 million and $41.0 million, respectively, which resulted in approximately $75.3 million and $40.8 million, respectively, of direct charges to expense during these years. These increased estimates are included in the revisions in estimated cash flows in the table above. A portion of the excess decommissioning costs recorded during 2013 and 2012 was associated with properties not operated by Maritech and also include additional work incurred and anticipated to be required, including remediation work required on certain wells that had been previously plugged.

Our estimate of remaining hurricane related decommissioning costs is approximately $7.7 million and has been accrued as part of Maritech’s decommissioning liabilities. Settlements of asset retirement obligations during 2013 include approximately $5.3 million of obligations associated with oil and gas properties that were sold by Maritech during the year.