Property And Equipment

12 Months Ended

Dec. 31, 2012

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment Disclosure [Text Block]

Note 4. Property and Equipment

The following table presents a summary of our net property and equipment balances as of December 31, 2012 and 2011:



	December 31,
In thousands	2012			2011
Oil and natural gas properties
Proved properties	$	6,963,211		$	7,026,579
Unevaluated properties	809,154			1,157,106
Total	7,772,365			8,183,685
Accumulated depletion and depreciation	(2,827,256		)	(2,407,520		)
Net oil and natural gas properties	4,945,109			5,776,165
CO₂ properties
CO₂ properties	1,032,653			596,003
Accumulated depletion and depreciation	(119,784		)	(91,666		)
Net CO₂ properties	912,869			504,337
Pipelines and plants
CO₂ pipelines ⁽¹⁾	1,632,255			1,432,646
Plants under construction ⁽²⁾	402,871			269,110
Total	2,035,126			1,701,756
Accumulated depletion and depreciation	(99,185		)	(65,392		)
Net plants and pipelines	1,935,941			1,636,364
Other property and equipment
Other property and equipment	417,207			157,674
Accumulated depletion and depreciation	(134,016		)	(62,915		)
Net other property and equipment	283,191			94,759
Net property and equipment	$	8,077,110		$	8,011,625


(1)	Amounts include $346.5 million of CO₂ pipelines at December 31, 2012 that were not subject to depreciation during 2012.


(2)	Plants under construction are not subject to depreciation.

A summary of the unevaluated properties excluded from oil and natural gas properties being amortized at December 31, 2012, and the year in which they were incurred follows:



	December 31, 2012
	Costs Incurred During:
In thousands	2012		2011		2010		2009 and prior		Total
Property acquisition costs	$	110,658	$	12,543	$	351,712	$	115,075	$	589,988
Exploration and development	106,075		40,152		3,155		8,390		157,772
Capitalized interest	29,249		30,430		333		1,382		61,394
Total	$	245,982	$	83,125	$	355,200	$	124,847	$	809,154

Our 2012 property acquisition costs were primarily related to the fair value allocated to our Hartzog Draw and Thompson fields. Our 2010 property acquisition costs were primarily related to the fair value allocated to CO₂ tertiary potential at our Bell Creek and Cedar Creek Anticline properties, acquired as part of the Encore Merger. Property acquisition costs for 2009 and prior were primarily related to CO₂ tertiary potential at Conroe Field. Exploration and development costs shown as unevaluated properties are primarily associated with our tertiary oil fields that are under development but did not have proved reserves at December 31, 2012. The most significant development costs incurred during 2012 and 2011 relate to development in preparation for upcoming CO₂ floods at Bell Creek and Grieve fields. We have not yet recognized proved reserves in these fields.

During 2012, we established proved reserves at Hastings and Oyster Bayou fields and, as a result, transferred $431.1 million of costs incurred on these projects into the amortization base. Costs are transferred into the amortization base on an ongoing basis as projects are evaluated and proved reserves established or impairment determined. We review the excluded properties for impairment at least annually. We currently estimate that evaluation of most of these properties and the inclusion of their costs in the amortization base is expected to be completed within five years. Until we are able to determine whether there are any proved reserves attributable to the above costs, we are not able to assess the future impact on the amortization rate of the full cost pool.

- Definition

The entire disclosure for long-lived, physical assets that are used in the normal conduct of business to produce goods and services and not intended for resale. Examples include land, buildings, machinery and equipment, and other types of furniture and equipment including, but not limited to, office equipment, furniture and fixtures, and computer equipment and software. This disclosure may include property plant and equipment accounting policies and methodology, a schedule of property, plant and equipment gross, additions, deletions, transfers and other changes, depreciation, depletion and amortization expense, net, accumulated depreciation, depletion and amortization expense and useful lives, income statement disclosures, assets held for sale and public utility disclosures.

+ References+ Details