2. Properties and Equipment, Net

Properties and equipment, net are comprised of the following:

	December 31,

(In thousands)	2012			2011
Proved oil and gas properties	$	5,724,940		$	5,006,846
Unproved oil and gas properties		467,483			478,942
Gathering and pipeline systems		239,656			238,660
Land, building and other equipment		86,137			80,908

		6,518,216			5,805,356
Accumulated depreciation, depletion and amortization		(2,207,239	)		(1,870,772	)

	$	4,310,977		$	3,934,584

Capitalized Exploratory Well Costs

The following table reflects the net changes in capitalized exploratory well costs:

	Year Ended December 31,

(In thousands)	2012			2011			2010
Beginning balance at January 1	$	5,328		$	4,285		$	4,179
Additions to capitalized exploratory well costs pending the determination of proved reserves		10,390			5,328			4,285
Reclassifications to wells, facilities, and equipment based on the determination of proved reserves		—			(1,138	)		(4,148	)
Capitalized exploratory well costs charged to expense		(5,328	)		(3,147	)		(31	)

Ending balance at December 31	$	10,390		$	5,328		$	4,285

The following table provides an aging of capitalized exploratory well costs based on the date the drilling was completed:

	December 31,

(In thousands)	2012		2011		2010
Capitalized exploratory well costs that have been capitalized for a period of one year or less	$	10,390	$	5,328	$	4,285
Capitalized exploratory well costs that have been capitalized for a period greater than one year		—		—		—

	$	10,390	$	5,328	$	4,285

Impairments

During 2010, the Company recorded an impairment of $40.9 million associated with its oil and gas properties and other assets. The Company recorded a $35.8 million impairment of oil and gas properties due to price declines and limited activity in two south Texas fields. These fields were reduced to fair value of approximately $15.4 million. An impairment of $5.1 million was recorded related to drilling and service equipment that was primarily used for drilling activities in West Virginia. The impairment was a result of decreased activity in West Virginia and the decision to sell the drilling and service equipment. These assets were reduced to fair value of approximately $4.0 million.

The Company also recorded an impairment loss of approximately $5.8 million during 2010 associated with the sale of certain properties in Colorado, which was recognized in Gain / (loss) on sale of assets in the Consolidated Statement of Operations. The fair value of the impaired properties was approximately $3.0 million and was determined using a market approach which considered the execution of a purchase and sale agreement the Company entered into on June 30, 2010. Accordingly, the inputs associated with the fair value of assets held for sale were considered Level 2 in the fair value hierarchy.

Fair value of oil and gas properties was determined using the income approach utilizing discounted future cash flows. The fair value of the impaired oil and gas properties and other assets was based on significant inputs that were not observable in the market and are considered to be Level 3 inputs. Refer to Note 14 for more information and a description of fair value hierarchy. Key assumptions include (1) natural gas and crude oil prices (adjusted to quality and basis differentials), (2) projections of estimated quantities of oil and gas reserves and production, (3) estimates of future development and operating costs and (4) risk adjusted discount rates (14% at September 30, 2010). Fair value of drilling and service equipment was determined using the market approach which considered broker quotes from market participants in the oil field services sector.

Divestitures

The Company recognized an aggregate gain on sale of assets of $50.6 million, $63.4 million and $106.3 million for the years ended December 31, 2012, 2011 and 2010, respectively.

In December 2012, the Company sold certain proved oil and gas properties located in south Texas to a private company for $29.9 million, subject to post closing adjustments, and recognized an $18.2 million loss on sale of assets.

In June 2012, the Company sold a 35% non-operated working interest associated with certain of its Pearsall Shale undeveloped leaseholds in south Texas to a wholly owned subsidiary of Osaka Gas Co., Ltd. (Osaka) for total consideration of approximately $251.0 million. The Company received $125.0 million in cash proceeds and Osaka agreed to fund 85% of the Company's share of future drilling and completion costs associated with these leaseholds until it has paid approximately $126.0 million in accordance with a joint development agreement entered into at closing. The drilling and completion carry will terminate two years after the closing of the transaction. The Company recognized a $67.0 million gain on sale of assets associated with this sale.

In 2012, the Company also sold various other unproved properties and other assets for total proceeds of $14.4 million and recognized an aggregate gain of $1.8 million.

In October 2011, the Company sold certain proved oil and gas properties located in Colorado, Utah and Wyoming to Breitburn Operating L.P., a wholly owned subsidiary of Breitburn Energy Partners L.P. for $285.0 million. The Company received $283.2 million in cash proceeds, after closing adjustments, and recognized a $4.2 million gain on sale of assets.

In May 2011, the Company sold certain of its unproved Haynesville and Bossier Shale oil and gas properties in east Texas to a third party. The Company received approximately $47.0 million in cash proceeds and recognized a $34.2 million gain on sale of assets.

In February and April 2011, respectively, the Company entered into two participation agreements with third parties related to certain of its Haynesville and Bossier Shale leaseholds in east Texas. Under the terms of the participation agreements, the third parties agreed to fund 100% of the cost to drill and complete certain Haynesville and Bossier Shale wells in the related leaseholds over a multi-year period in exchange for a 75% working interest in the leaseholds. During 2011, the Company received a reimbursement of drilling costs incurred of approximately $12.9 million associated with wells that had commenced drilling prior to the execution of the participation agreements.

In 2011, the Company also sold various other unproved properties and other assets for total proceeds of $73.5 million and recognized an aggregate gain of $25.0 million.

In December 2010, the Company sold its existing Pennsylvania gathering infrastructure of approximately 75 miles of pipeline and two compressor stations to Williams Field Services (Williams), a subsidiary of Williams Partners L.P., for $150 million and recognized a $49.3 million gain on sale of assets, which included the accrual of $17.9 million related to certain obligations that were required under the terms of the purchase and sale agreement.

In November 2010, the Company sold its investment in common stock of Tourmaline Oil Corporation for $61.3 million and recognized a gain of $40.7 million which is included in Gain/(loss) on sale of assets in the Consolidated Statement of Operations.

In 2010, the Company also sold various other proved and unproved properties and other assets for total proceeds of $32.2 million and recognized an aggregate gain of $16.3 million.