Annual Report 2011 - PGS

Notes to the consolidated financial statements
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 7 - Depreciation and Amortization and Impairments of Long-Term Assets
Depreciation and amortization consist of the following for the years presented:
Years ended December 31,
2011 2010
2009
(In thousands of dollars)
Restated(a) Restated(a)
Gross depreciation and amortization (210,842) (189,955) (175,153)
Depreciation capitalized to MultiClient library (Note 19) 49,966 42,507 30,995
Amortization of MultiClient library (Note 19) (237,005) (197,460) (159,625)
Total (397,881) (344,908) (303,783)
(a) See note 2
Impairments and reversal of impairments of long-term assets consist of the following for the years presented:
Years ended December 31,
(In thousands of dollars) 2011 2010 2009
Property and equipment; impairment (Notes 16 and 18) (4,582) (94,312) (153,615)
Property and equipment; reversal of impairment (Note 18) 1,999 15,176 ---
Total (2,583) (79,136) (153,615)
Note 8 - Interest Expense
Interest expense consists of the following:
Years ended December 31,
(In thousands of dollars) 2011 2010 2009
Interest expense, gross (50,459) (55,425) (70,472)
Interest capitalized in MultiClient library (Note 19) 6,409 5,894 6,000
Interest capitalized in construction in progress (Note 18) 1,880 2,535 19,240
Total (42,170) (46,996) (45,232)
The average interest rate used to determine the amount of interest expense eligible for capitalization was 6.1%, 5.9% and 5.9%
for the years ended December 31, 2011, 2010 and 2009 respectively.
Note 9 - Other Financial Income and Expense
Other financial income consists of the following:
Years ended December 31,
(In thousands of dollars) 2011 2010 2009
Gain from sale of shares (Note 13 and 20) 10,985 6,483 8,671
Interest income 7,617 5,728 7,238
Gain on investments in shares available-for-sale (Note 13) 162 711 3,749
Gain on repurchase of convertible notes (Note 25) --- --- 3,778
Other 5,687 938 1,053
Total 24,451 13,860 24,489
Other financial expense consists of the following:
Years ended December 31,
(In thousands of dollars) 2011 2010 2009
Fair value adjustments on derivatives (11,595) --- ---
Impairment of shares available-for-sale (Note 13) (9,567) (1,742) ---
Loss on repurchase of convertible notes (Note 25) (5,678) --- ---
Amendment fees USD 950 million Credit Facilities (Note 25) --- (7,029) ---
Fee in connection with redemption of 8.28% Notes (Note 25) --- (1,229) ---
Instruction fee convertible notes (includes professional fees) (Note 25) --- --- (6,895)
Other (6,891) (7,580) (4,222)
Total (33,731) (17,580) (11,117)
PGS ANNUAL REPORT 2011 16
PGS Annual Report 2011 87