7. PROPERTY, PLANT AND EQUIPMENT AND INTANGIBLE ASSETS

Property, plant and equipment, net

Property, plant and equipment, net is comprised of the following as of each period presented:


	Estimated
	Useful	March 31,		December 31,
In thousands	Lives (Years)	2016		2015
Gathering pipelines and related equipment	45	$	281,477	$	319,058
Gas processing and compression facilities	20		133,941		173,679
Buildings	30		2,144		2,175
Other depreciable assets	3 - 15		5,543		5,589
Land and rights of way			9,027		9,027
Construction in progress			(64)		277
Total property, plant and equipment			432,068		509,805
Accumulated depreciation			(29,015)		(24,650)
Total property, plant and equipment, net		$	403,053	$	485,155

With the recent decline in commodity prices negatively affecting the level of natural gas and crude oil production as well as the terms of the AES Agreement, we concluded that a triggering event had occurred which required a test for impairment of our assets. The fair value of our long-lived assets was below the carrying value for our gathering and processing assets. As a result, we recorded an impairment of $78.3 million to adjust the processing assets to their net realizable value in the three months ended March 31, 2016.

The net realizable value for the processing assets was determined based upon third party valuations and recent market transactions which are considered Level 2 and Level 3 inputs in accordance with the accounting guidance.

Depreciation expense was $4.4 million for the three months ended March 31, 2016 and $2.7 million for the three months ended March 31, 2015.

Intangible assets, net

As part of the AES Agreement executed on March 31, 2016, the gathering and processing agreement and the logistics contracts were terminated effective January 1, 2016. Accordingly, the intangible assets which represented the existing customer relationship with AES were impaired. The intangible assets were identified as part of the purchase price allocation to the Partnership's assets acquired by the Azure System.

The Partnership recorded an intangible asset impairment of $29.2 million during the three months ended March 31, 2016. The remaining balance of the intangible asset will be eliminated in the second quarter of 2016 as part of the assignment of common and subordinated units and IDR Units from NuDevco to the Partnership.

The intangible impairment recorded in the three months ended March 31, 2016 was calculated based upon the fair value of the NuDevco units that were surrendered on April 1, 2016. The fair value of the common shares were determined based upon the unit price as of March 31, 2016 which is considered a Level 1 input. The fair values of the subordinated units and IDR Units were derived from the common unit price as of March 31, 2016 and was determined using the purchase price valuation performed in connection with the Transactions which is considered a Level 2 input.

The amortization expense associated with the customer contracts and customer relationships intangible assets, which is included within depreciation and amortization expense within the statement of operations was $1.6 million and $0.5 million for the three months ended March 31, 2016 and 2015.