3. Property and Equipment

Property and equipment consisted of the following at December 31, 2014 and 2013 (in thousands):

	2014			2013
Equipment	$	6,679,894		$	5,749,975
Oil and natural gas properties		196,234			183,571
Buildings		83,465			80,050
Land		12,038			12,054
		6,971,631			6,025,650
Less accumulated depreciation, depletion and impairment		(2,840,560	)		(2,390,109	)
Property and equipment, net	$	4,131,071		$	3,635,541

Depreciation, depletion, amortization and impairment — The following table summarizes depreciation, depletion, amortization and impairment expense related to property and equipment and intangible assets for 2014, 2013 and 2012 (in thousands):

	2014		2013		2012
Depreciation and impairment expense	$	693,390	$	573,106	$	502,953
Amortization expense		3,643		3,993		4,110
Depletion expense		21,697		20,370		19,551
Total	$	718,730	$	597,469	$	526,614

The Company evaluates the recoverability of its long-lived assets whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable (a “triggering event”). In light of the significant decline in oil and natural gas commodity prices beginning in the fourth quarter of 2014 and continuing into 2015, management deemed it necessary to assess the recoverability of long-lived assets within its contract drilling and pressure pumping segments. With respect to the long-lived assets in the Company’s oil and natural gas exploration and production segment, the Company assesses the recoverability of long-lived assets at the end of each quarter due to revisions in its oil and natural gas reserve estimates and expectations about future commodity prices.

Long-lived assets are evaluated for impairment at the lowest level for which identifiable cash flows can be separated from other long-lived assets. The Company performs the first step of its impairment assessments by comparing the undiscounted cash flows for each long-lived asset or asset group to its respective carrying value. In 2014, the Company’s analysis indicated that the carrying amounts of long-lived assets in the contract drilling and pressure pumping segments were recoverable. The Company’s analysis indicated that the carrying amounts of certain oil and natural gas properties were not recoverable at various testing dates in 2014, 2013 and 2012. The Company’s estimates of expected future net cash flows from impaired properties are used in measuring the fair value of such properties. The Company recorded impairment charges of $20.9 million, $4.0 million and $1.9 million in 2014, 2013 and 2012, respectively, related to its oil and natural gas properties.

On a periodic basis, the Company evaluates its fleet of drilling rigs for marketability based on the condition of inactive rigs, expenditures that would be necessary to bring them to working condition and the expected demand for drilling services by rig type (such as drilling conventional vertical wells versus drilling longer horizontal wells using high capacity rigs). The components comprising rigs that will no longer be marketed are evaluated, and those components with continuing utility to the Company’s other marketed rigs are transferred to other rigs or to its yards to be used as spare equipment. The remaining components of these rigs are retired. In 2014, the Company identified 55 mechanical rigs that it determined would no longer be marketed. The Company recorded a charge of $77.9 million related to the retirement of these mechanical rigs and the write-off of excess spare components for the now reduced size of the Company’s mechanical fleet. In 2013, the Company identified 48 rigs that would no longer be marketed. Also, the Company had 55 additional mechanical rigs that were not operating. Although these 55 rigs remained marketable at the time, the Company had lower expectations with respect to utilization of these rigs due to the industry shift to electric powered drilling rigs. The Company recorded a charge of $37.8 million related to the retirement of the 48 rigs and the 55 mechanical rigs that remained marketable but were not operating. In 2012, the Company identified 36 rigs that it determined would no longer be marketed and recorded a charge of $5.2 million related to the retirement of these rigs.

In 2013, due to a shift in customer demand away from mechanically powered drilling rigs to electric powered drilling rigs, the Company recorded in its consolidated statement of operations a charge of $29.9 million related to 55 mechanical rigs that were not under contract. Although these 55 rigs remained marketable at the time, the Company had lower expectations with respect to utilization of these rigs due to the industry shift to electric powered drilling rigs. There were no similar charges in 2014 or 2012.

The Company also evaluates its fleet of marketable pressure pumping equipment and in 2012 identified approximately 37,000 horsepower of pressure pumping equipment that would be retired. The net book value of these assets of $7.3 million was expensed in the Company’s consolidated statements of operations. There were no similar charges in 2014 or 2013.

During 2012, the Company sold its flowback operations in a cash transaction. The sale price was $42.5 million and the Company recognized a gain on disposal of $22.6 million.