Property, Plant and Equipment

Property, plant and equipment consists of the following (in thousands):



	June 30, 2014			December 31, 2013
Oil and natural gas properties
Proved(1)	$	10,807,088		$	10,972,816
Unproved	309,043			531,606
Total oil and natural gas properties	11,116,131			11,504,422
Less accumulated depreciation, depletion and impairment	(6,138,833		)	(5,762,969		)
Net oil and natural gas properties capitalized costs	4,977,298			5,741,453
Land	18,270			18,423
Non-oil and natural gas equipment(2)	614,198			600,603
Buildings and structures(3)	244,076			233,405
Total	876,544			852,431
Less accumulated depreciation and amortization	(312,023		)	(286,209		)
Other property, plant and equipment, net	564,521			566,222
Total property, plant and equipment, net	$	5,541,819		$	6,307,675

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(1)	Includes cumulative capitalized interest of approximately $29.0 million and $23.4 million at June 30, 2014 and December 31, 2013, respectively.


(2)	Includes cumulative capitalized interest of approximately $4.3 million at both June 30, 2014 and December 31, 2013.


(3)	Includes cumulative capitalized interest of approximately $14.4 million and $12.0 million at June 30, 2014 and December 31, 2013, respectively.

Accumulated depreciation, depletion and impairment on oil and natural gas properties includes cumulative full cost ceiling limitation impairment of $3.7 billion and $3.5 billion at June 30, 2014 and December 31, 2013, respectively. During the six-month period ended June 30, 2014, the Company reduced the net carrying value of its oil and natural gas properties by $164.8 million as a result of its first quarter full cost ceiling analysis.

Drilling Carry Commitments

The Company has agreements with two co-working interest parties, which contain carry commitments to fund a portion of its future drilling, completing and equipping costs within areas of mutual interest. The Company recorded approximately $175.4 million for Repsol E&P USA, Inc.’s (“Repsol”) carry during the six-month period ended June 30, 2014, and a combined $248.3 million for both Atinum MidCon I, LLC’s (“Atinum”) and Repsol’s drilling carries during the six-month periods ended June 30, 2013, which reduced the Company’s capital expenditures for the respective periods. Atinum fully funded its carry commitment in the third quarter of 2013. The Company expects Repsol to fully fund its carry commitment during 2014.

Under the agreement with Repsol, the remaining carry commitment could be reduced if a certain number of wells are not drilled within the area of mutual interest during a twelve-month period and the Company fails to drill such wells following a proposal by Repsol to drill the wells. During 2013, the Company temporarily reduced its rate of drilling activity. As a result, the Company drilled less than the targeted number of wells for such twelve-month period, which resulted in Repsol having a right to propose additional wells. In June 2014, the Company and Repsol amended their agreement to eliminate Repsol’s right to propose such additional wells in exchange for a commitment by the Company to drill 484 net wells in the area of mutual interest between January 1, 2014 and May 31, 2015, subject to delays due to factors beyond the Company’s control. If the Company does not drill the committed number of wells within such time period, it will be required to carry Repsol’s drilling, completing and equipping costs for subsequent wells drilled in the area of mutual interest, up to a maximum of $75.0 million in carry costs. As of June 30, 2014, the Company has drilled 143 net wells under this arrangement and currently anticipates satisfying its drilling commitment within the required time period. The Company has no other drilling obligation to Repsol.