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Property, Plant and Equipment | 12 Months Ended
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Dec. 31, 2012
Property, Plant and Equipment [Abstract] |
Property, Plant and Equipment | Note 8. Property, Plant and Equipment The historical costs of our property, plant and equipment and related accumulated depreciation balances were as follows at the dates indicated:
|  | Estimated Useful Life in Years |  |  | December 31, |
|  |  |  | 2012 |  |  | 2011 |
Plants, pipelines and facilities (1) |  | 3-45 (6) |  |  | $ | 25,382.4 |  |  | $ | 22,354.4 |
Underground and other storage facilities (2) |  | 5-40 (7) |  |  |  | 1,826.3 |  |  |  | 1,388.6 |
Platforms and facilities (3) |  | 20-31 |  |  |  | 635.2 |  |  |  | 637.5 |
Transportation equipment (4) |  | 3-10 |  |  |  | 136.2 |  |  |  | 151.5 |
Marine vessels (5) |  | 15-30 |  |  |  | 695.0 |  |  |  | 615.9 |
Land |  |  |  |  |  |  | 167.2 |  |  |  | 136.1 |
Construction in progress |  |  |  |  |  |  | 2,113.1 |  |  |  | 2,145.6 |
Total |  |  |  |  |  |  | 30,955.4 |  |  |  | 27,429.6 |
Less accumulated depreciation |  |  |  |  |  |  | 6,109.0 |  |  |  | 5,238.0 |
Property, plant and equipment, net |  |  |  |  |  | $ | 24,846.4 |  |  | $ | 22,191.6 |
(1) Plants and pipelines include processing plants; NGL, natural gas, crude oil and petrochemical and refined products pipelines; terminal loading and unloading facilities; office furniture and equipment; buildings; laboratory and shop equipment and related assets. (2) Underground and other storage facilities include underground product storage caverns; above ground storage tanks; water wells and related assets. (3) Platforms and facilities include offshore platforms and related facilities and other associated assets located in the Gulf of Mexico. (4) Transportation equipment includes tractor-trailer tank trucks and other vehicles and similar assets used in our operations. (5) Marine vessels include tow boats, barges and related equipment used in our marine transportation business. (6) In general, the estimated useful lives of major assets within this category are: processing plants, 20-35 years; pipelines and related equipment, 5-45 years; terminal facilities, 10-35 years; office furniture and equipment, 3-20 years; buildings, 20-40 years; and laboratory and shop equipment, 5-35 years. (7) In general, the estimated useful lives of assets within this category are: underground storage facilities, 5-35 years; storage tanks, 10-40 years; and water wells, 5-35 years. |
In February 2011, we sold certain marine transportation assets for $53.2 million. These assets were used to provide marine distribution of bunker fuels for cruise liners and cargo ships and fuel oil for electric generation plants in Alabama, Florida, Louisiana, Mississippi and Texas markets. We recorded a $3.3 million gain related to this sale. In December 2011, we sold our equity interests in Crystal Holding L.L.C. ("Crystal"), which owns natural gas storage facilities and associated pipelines located in Mississippi for $547.8 million in cash (net of working capital adjustments). We recorded a $129.1 million gain on the sale of Crystal. At the time of sale, the net carrying value of our investment in Crystal was approximately $411.9 million, of which $356.2 million was the total net carrying value of Crystal's property, plant and equipment. We determined that the financial results of Crystal did not meet the criteria to be classified as discontinued operations. We continue to enter into commercial contracts and have operational arrangements with the Petal and Hattiesburg natural gas storage facilities, which are adjacent to and currently share operating assets with our retained Petal, Mississippi NGL storage facility. The following table summarizes our depreciation expense and capitalized interest amounts for the periods presented:
|  | For Year Ended December 31, |
|  | 2012 |  |  | 2011 |  |  | 2010 |
Depreciation expense (1) |  | $ | 900.5 |  |  | $ | 776.6 |  |  | $ | 745.7 |
Capitalized interest (2) |  |  | 116.8 |  |  |  | 106.7 |  |  |  | 47.2 |
(1) Depreciation expense is a component of "Costs and expenses" as presented on our Statements of Consolidated Operations. (2) We capitalize interest cost incurred on funds used to construct property, plant and equipment. The capitalized interest cost is recorded as part of the asset to which it relates and is amortized over the asset's estimated useful life as a component of depreciation expense. See Note 20 for information regarding cash payments for interest. |
Operating costs and expenses for the years ended December 31, 2011 and 2010 include $19.7 million and $30.5 million, respectively, of depreciation, amortization and accretion expense related to the Crystal assets. Asset Retirement Obligations We record AROs in connection with legal requirements to perform specified retirement activities under contractual arrangements and/or governmental regulations. Our contractual AROs primarily result from right-of-way agreements associated with our pipeline operations and real estate leases associated with our plant sites. In addition, we record AROs in connection with governmental regulations associated with the abandonment or retirement of (i) above-ground brine storage pits, (ii) offshore Gulf of Mexico platform and pipeline assets and (iii) certain marine vessels. We also record AROs in connection with regulatory requirements associated with the renovation or demolition of certain assets containing hazardous substances such as asbestos. We typically fund our ARO obligations using cash flow from operations. Property, plant and equipment at December 31, 2012 and 2011 includes $40.3 million and $37.7 million, respectively, of asset retirement costs capitalized as an increase in the associated long-lived asset. The following table presents information regarding our AROs since December 31, 2010:
ARO liability balance, December 31, 2010 |  | $ | 97.1 |
Liabilities incurred |  |  | 0.7 |
Liabilities settled |  |  | (7.3 | )
Revisions in estimated cash flows |  |  | 15.0 |
Accretion expense |  |  | 6.5 |
ARO liability balance, December 31, 2011 |  |  | 112.0 |
Liabilities incurred |  |  | 1.7 |
Liabilities settled |  |  | (27.8 | )
Revisions in estimated cash flows |  |  | 13.7 |
Accretion expense |  |  | 5.6 |
ARO liability balance, December 31, 2012 |  | $ | 105.2 |
The following table presents our forecast of accretion expense for the periods presented:
2013 |  |  | 2014 |  |  | 2015 |  |  | 2016 |  |  | 2017 |
$ | 6.2 |  |  | $ | 6.5 |  |  | $ | 6.3 |  |  | $ | 6.6 |  |  | $ | 7.1 |
Certain of our unconsolidated affiliates have AROs recorded at December 31, 2012 and 2011 relating to contractual agreements and regulatory requirements. These amounts are immaterial to our consolidated financial statements.

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- 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 Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6360339&loc=d3e1361-107760 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02.13-14) -URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher AICPA -Name Accounting Principles Board Opinion (APB) -Number 12 -Paragraph 5 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 360 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6391035&loc=d3e2868-110229 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 360 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6391110&loc=d3e2921-110230 + Details
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