Property, Plant and Equipment
|9 Months Ended|
Sep. 30, 2021
|Property, Plant and Equipment [Abstract]|
|Property, Plant and Equipment||Property, Plant and Equipment
Property, plant and equipment include the following (in thousands):
a. Included in Buildings at each of September 30, 2021 and December 31, 2020 are costs of $7.6 million related to assets under operating leases.
b. Included in Other property and equipment at each of September 30, 2021 and December 31, 2020 are costs of $6.0 million related to assets under operating leases.
c. Deposits on equipment and equipment in process of assembly represents deposits placed with vendors for equipment that is in the process of assembly and purchased equipment that is being outfitted for its intended use. The equipment is not yet placed in service.
d. Includes accumulated depreciation of $6.3 million and $5.0 million at September 30, 2021 and December 31, 2020, respectively, related to assets under operating leases.
Oil prices declined significantly in March 2020 as a result of geopolitical events that increased the supply of oil in the market as well as effects of the COVID-19 pandemic. As a result, the Company determined that it was more likely than not that the fair value of certain of its oilfield services assets were less than their carrying value. Therefore, the Company performed an interim impairment test. As a result of the test, the Company recorded the following impairments to its fixed assets during the first quarter of 2020 (in thousands):
The Company measured the fair values of these assets using direct and indirect observable inputs (Level 2) based on a market approach. The Company did not record any impairment of other long-lived assets during the three and nine months ended September 30, 2021.
Proceeds from customers for horizontal and directional drilling services equipment damaged or lost down-hole are reflected in revenue with the carrying value of the related equipment charged to cost of service revenues and are reported as cash inflows from investing activities in the unaudited condensed consolidated statement of cash flows. For the nine months ended September 30, 2020, proceeds and gains from the sale of equipment damaged or lost down-hole were a nominal amount and $0.7 million, respectively. The Company did not have any proceeds or gains from the sale of
equipment damaged or lost down-hole during the three and nine months ended September 30, 2021 and three months ended September 30, 2020.
Proceeds from assets sold or disposed of as well as the carrying value of the related equipment are reflected in “other income (expense), net” on the unaudited condensed consolidated statement of comprehensive loss. For the three and nine months ended September 30, 2021 and 2020, proceeds from the sale of equipment were $4.9 million, $9.5 million, $2.7 million and $4.9 million, respectively, and gains (losses) from the sale or disposal of equipment were $3.0 million, $4.6 million, ($0.6) million and $0.2 million, respectively.
Depreciation, depletion, amortization and accretion
A summary of depreciation, depletion, amortization and accretion expense is below (in thousands):
The entire disclosure for long-lived, physical asset used in normal conduct of business and not intended for resale. Includes, but is not limited to, work of art, historical treasure, and similar asset classified as collections.
Reference 1: http://www.xbrl.org/2003/role/disclosureRef