ASSET RETIREMENT OBLIGATION

We recognize an estimated liability for future costs associated with the abandonment and reclamation of our mining properties. A liability for the fair value of an asset retirement obligation and a corresponding increase to the carrying value of the related long-lived asset are recorded as the mining operations occur or the assets are acquired.

Our asset retirement obligation is based on the estimated cost to abandon and reclaim the mining operations, the economic life of the properties, and federal and state regulatory requirements. The liability is discounted using credit adjusted risk-free rate estimates at the time the liability is incurred or when there are upward revisions to estimated costs. The credit adjusted risk-free rates used to discount our abandonment liabilities range from 6.9% to 9.7%. Revisions to the liability occur due to construction of new or expanded facilities, changes in estimated abandonment costs or economic lives, changes in the estimated timing of the reclamation activities or if federal or state regulators enact new requirements regarding the abandonment or reclamation of mines. In the fourth quarter of 2016, we extended our estimate of when the majority of our reclamation activities would occur by five years. This longer period of time resulted in a decrease in our asset retirement obligation.

Following is a table of the changes to our asset retirement obligations for the following periods (in thousands):



	Year Ended December 31,
	2018			2017			2016
Asset retirement obligation, at beginning of period	$	21,476		$	19,976		$	22,951
Liabilities settled	(19		)	—			(3		)
Liabilities incurred	—			29			—
Changes in estimated obligations	—			(87		)	(4,740		)
Accretion of discount	1,668			1,558			1,768
Total asset retirement obligation, at end of period	$	23,125		$	21,476		$	19,976

The undiscounted amount of asset retirement obligation is $59.5 million as of December 31, 2018, of which we estimate approximately $6.6 million in payments may occur in the next five years.