Epsilon Energy Ltd
For the period ended Jun 30, 2024. Filed Aug 13, 2024.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2024 · Filed Aug 13, 2024
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15. Asset Retirement Obligations
Asset retirement obligations are estimated by management based on Epsilon’s net ownership interest in all wells and the gathering system, estimated costs to reclaim and abandon such assets and the estimated timing of the costs to be incurred in future periods, and the forecast risk free cost of capital. Epsilon has estimated the value of its total asset retirement obligations to be $3.5 million as of June 30, 2024 ($3.5 million at December 31, 2023). Each year we review, and to the extent necessary, revise our asset retirement obligations estimates in accordance with recent activity and current service costs.
The following tables summarize the changes in asset retirement obligations for the periods indicated:
| | | | | | | |
|---|---|---|---|---|---|---|
| · · Six Months Ended · · Year ended | ||||||
| | | | June 30, | | | December 31, |
| · · 2024 · 2023 | ||||||
| Balance beginning of period | | $3,502,952 | | $2,780,237 | ||
| Liabilities acquired | | | 21,831 | | | 12,437 |
| Liabilities disposed of | | | — | | | (46,961) |
| Wells plugged and abandoned | | | (87,284) | | | (509,802) |
| Change in estimates | | | — | | | 1,178,142 |
| Accretion | | | 90,709 | | | 88,899 |
| Balance end of period | | $3,528,208 | | $3,502,952 | ||
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