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Asset Retirement Obligations

12 Months Ended

Mar. 31, 2021

Asset Retirement Obligation Disclosure [Abstract]

Asset Retirement Obligations

6. Asset Retirement Obligations

The Company’s asset retirement obligations relate to the plugging of wells, the removal of facilities and equipment, and site restoration on oil and gas properties. The fair value of a liability for an ARO is recorded in the period in which it is incurred, discounted to its present value using the credit adjusted risk-free interest rate, and a corresponding amount capitalized by increasing the carrying amount of the related long-lived asset. The liability is accreted each period until the liability is settled or the well is sold, at which time the liability is removed. The related asset retirement cost is capitalized as part of the carrying amount of our oil and natural gas properties. The ARO is included on the consolidated balance sheets with the current portion being included in the accounts payable and accrued expenses.

The following table provides a rollforward of the asset retirement obligations for fiscal years ended March 31:

		2021				2020
Carrying amount of asset retirement obligations, beginning of year		$	762,761			$	861,534
Liabilities incurred			17,587				19,512
Liabilities settled			(80,099	)			(145,520	)
Accretion expense			28,548				27,235
Revisions			-				-
Carrying amount of asset retirement obligations, end of year			728,797				762,761
Less: Current portion			15,000				7,500
Non-Current asset retirement obligation		$	713,797			$	755,261