Asset Retirement and Reclamation Obligations
|6 Months Ended|
Jun. 30, 2019
|Asset Retirement and Reclamation Obligations|
|Asset Retirement and Reclamation Obligations||
Asset retirement obligations ("ARO") relate to the Lost Creek mine and Pathfinder projects and are equal to the present value of all estimated future costs required to remediate any environmental disturbances that exist as of the end of the period discounted at a risk-free rate. Included in this liability are the costs of closure, reclamation, demolition and stabilization of the mines, processing plants, infrastructure, aquifer restoration, waste dumps and ongoing post-closure environmental monitoring and maintenance costs.
At June 30, 2019, the total undiscounted amount of the future cash needs was estimated to be $29.8 million. The schedule of payments required to settle the ARO liability extends through 2033.
The restricted cash as discussed in note 6 is related to the surety bonds which provide security to the governmental agencies on these obligations.
The entire disclosure for an asset retirement obligation and the associated long-lived asset. An asset retirement obligation is a legal obligation associated with the disposal or retirement from service of a tangible long-lived asset that results from the acquisition, construction or development, or the normal operations of a long-lived asset, except for certain obligations of lessees.
Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef