(7) Other Long-Term Obligations and Commitments:

Operating Leases:

The Company has several non-cancelable operating leases, primarily for rental of office space, that have a term of more than one year. The future minimum lease payments for the rest of fiscal 2013 and thereafter for the operating leases are as follows:


(Thousands of dollars)	Operating Leases
2013	$	332
2014		261
2015		122

Total minimum payments	$	715

Rent expense for office space for the six months ended June 30, 2013 and 2012 was $376,000 and $399,000, respectively.

Asset Retirement Obligation:

A reconciliation of the liability for plugging and abandonment costs for the six months ended June 30, 2013 is as follows:


(Thousands of dollars)
Asset retirement obligation – December 31, 2012	$	9,012
Liabilities incurred		90
Liabilities settled		(234	)
Accretion expense		180
Revisions in estimated liabilities		1,524

Asset retirement obligation – June 30, 2013	$	10,572

The Company’s liability is determined using significant assumptions, including current estimates of plugging and abandonment costs, annual inflation of these costs, the productive life of wells and a risk-adjusted interest rate. Changes in any of these assumptions can result in significant revisions to the estimated asset retirement obligation. Revisions to the asset retirement obligation are recorded with an offsetting change to producing properties, resulting in prospective changes to depreciation, depletion and amortization expense and accretion of discount. Because of the subjectivity of assumptions and the relatively long life of most of the Company’s wells, the costs to ultimately retire the wells may vary significantly from previous estimates.