FIXED ASSETS, NET AND ASSET RETIREMENT OBLIGATIONS

Fixed assets consist of the following:



	Useful Life (in years)	December 31, 2015			December 31, 2014
Equipment	7-20	$	36,540,268		$	32,533,022
Furniture and fixtures	7	133,823			133,824
Leasehold improvements	15	2,300,207			2,214,266
Office equipment	5	591,619			526,353
Vehicles	5	6,422,531			6,088,769
Construction in progress		12,305,376			15,870,487
Land		2,553,000			2,553,000
Total fixed assets		60,846,824			59,919,721
Less accumulated depreciation		(7,818,217		)	(3,758,373		)
Net fixed assets		$	53,028,607		$	56,161,348

Depreciation expense was $4,106,526 and $2,405,203 for the years ended December 31, 2015 and 2014, respectively.

Equipment under construction in progress is related to TCEP technology improvements, refining equipment at the Marrero and Myrtle Grove facilities in Louisiana, and refining equipment in Fallon, Nevada.

Asset retirement obligations:

The Company has asset retirement obligations with respect to certain of its refinery assets due to various legal obligations to clean and/or dispose of various component parts of each refinery at the time they are retired. However, these component parts can be used for extended and indeterminate periods of time as long as they are properly maintained and/or upgraded. It is the Company’s practice and current intent to maintain its refinery assets and continue making improvements to those assets based on technological advances. As a result, the Company believes that its refinery assets have indeterminate lives for purposes of estimating asset retirement obligations because dates, or ranges of dates, upon which the Company would retire refinery assets cannot reasonably be estimated. When a date or range of dates can reasonably be estimated for the retirement of any component part of a refinery, the Company estimates the cost of performing the retirement activities and records a liability for the fair value of that cost using established present value techniques.