Buildings, improvements and leasehold improvements by psq21886

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									(5) Property, Plant and Equipment

A summary of property, plant and equipment at December 31, 2007 and 2006 (in thousands) is as follows:

                                                                   2007              2006
Buildings, improvements and leasehold improvements            $     64,459       $    53,240
Marine vessels and equipment                                       224,856           217,422
Machinery and equipment                                            857,762           561,570
Automobiles, trucks, tractors and trailers                          42,981            23,829
Furniture and fixtures                                              21,784            17,274
Construction-in-progress                                            73,762            48,274
Land                                                                 9,250             7,328
                                                                  1,294,854           928,937
Accumulated depreciation                                           (416,502)         (302,379)
Property, plant and equipment, net                            $    878,352       $   626,558

Oil and gas assets                                                 307,674           229,329
Accumulated depletion                                              (99,618)          (51,659)
Oil and gas assets, net, under the successful efforts
   method of accounting                                       $    208,056       $   177,670


The Company has approximately $13 million and $11 million of leasehold improvements at December 31, 2007 and
2006, respectively. These leasehold improvements are depreciated over the shorter of the life of the asset or the life
of the lease using the straight-line method. Depreciation expense (excluding depletion, amortization and accretion)
was approximately $121.3 million, $79.3 million and $68.6 million for the years ended December 31, 2007, 2006
and 2005, respectively.

(6) Equity-Method Investments

Investments in entities that are not controlled by the Company, but where the Company has the ability to exercise
influence over the operations are accounted for using the equity-method. The Company’s share of the income or
losses of these entities is reflected as earnings or losses from equity-method investments on its Consolidated
Statements of Operations.

In May 2006, SPN Resources acquired a 40% interest in BOG. The Company made total cash contributions for its
initial equity-method investment of approximately $57.8 million in 2006 and has not made additional contributions
in 2007. The Company’s equity-method investment balance in BOG is approximately $56.0 million and $63.6
million at December 31, 2007 and 2006, respectively. The earnings (loss) from the equity-method investment in
BOG was approximately ($3.0) million and $5.8 million for the years ended December 31, 2007 and 2006,
respectively. BOG had total proved reserves of approximately 4,579 Mbbls of oil and 75,646 Mmcf of gas at
December 31, 2007.

The Company provides operating and administrative support services to BOG and receives reimbursement for
general and administrative and direct expenses incurred on behalf of BOG. The Company, where possible and at
competitive rates, provides its products and services to assist BOG in producing and developing its oil and gas
properties. At December 31, 2007 and 2006, the Company had receivables of approximately $1.9 million and $3.0
million, respectively, due from BOG. The Company reduced its general and administrative expenses by
approximately $4.1 million and $1.7 million by the reimbursements due from BOG for 2007 and 2006, respectively.
The Company also recorded revenue of approximately $8.0 million and $1.4 million from BOG in 2007 and 2006,
respectively. The Company reduces its revenue and its investment in BOG for its 40% ownership when products
and services are provided to and capitalized by BOG. The Company records these amounts in revenue as BOG
records the related depreciation and depletion expenses. The Company recorded a net reduction to revenue and its



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