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Asset Retirement Obligations
 12 Months Ended
Dec. 31, 2023
Asset Retirement Obligation Disclosure [Abstract]  
Asset Retirement Obligations

Note 5 – Asset Retirement Obligations

 

The Company’s asset retirement obligations represent the estimated present value of the estimated cash flows the Company will incur to plug, abandon and remediate its producing properties at the end of their productive lives, in accordance with applicable state laws. Market risk premiums associated with asset retirement obligations are estimated to represent a component of the Company’s credit-adjusted risk-free rate that is utilized in the calculations of asset retirement obligations.

 

The Company’s asset retirement obligation transactions during the years ended December 31, 2023 and 2022 are summarized in the table below.

 

               
   For the Year Ended December 31, 
   2023   2022 
         
Asset retirement obligations, beginning of period  $25,000,740   $20,640,599 
Liabilities assumed in acquisitions   72,000    502,539 
Revisions   2,303,938    2,660,653 
Liabilities settled   (964,274)   (160,957)
Accretion expense   1,756,023    1,357,906 
Asset retirement obligation, end of period  $28,168,427   $25,000,740 
Less current portion included in Accrued Expenses   700,000    — 
Asset retirement obligation, long-term  $27,468,427   $25,000,740 

 

The revisions in 2023 primarily reflect cost revision estimates to wells in New Mexico based on 2023 plugging activity. The revisions in 2022 primarily relate to the identification of nonproducing wells, including injection wells and temporarily abandoned wells in New Mexico.