Asset Retirement Obligations

3 Months Ended

Mar. 31, 2024

Asset Retirement Obligation Disclosure [Abstract]

Asset Retirement Obligations

Note 12 — Asset Retirement Obligations

Our asset retirement obligations (“AROs”) relate to mature offshore oil and gas properties (Droshky and Thunder Hawk Field) that we acquired with the intention to perform decommissioning work at the end of their life cycles. AROs are recorded initially at fair value and consist of estimated costs for subsea infrastructure decommissioning and P&A activities associated with our oil and gas properties. The estimated costs are discounted to present value using a credit-adjusted risk-free discount rate. After its initial recognition, an ARO liability is increased for the passage of time as accretion expense, which is a component of our depreciation and amortization expense. An ARO liability may also change based on revisions in estimated costs and/or timing to settle the obligations. The following table describes the changes in our AROs (in thousands):

	2024		2023
AROs at January 1,	$	61,356	$	51,956
Accretion expense		1,376		1,168
AROs at March 31,	$	62,732	$	53,124