Air Canada 2007 Annual Report Download - page 114

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2007 Air Canada Annual Report
114
(e) Other includes asset retirement obligations of the Corporation. Under the terms of their respective land leases each Fuel
Facility Corporation has an obligation to restore the land to vacant condition at the end of the lease and to rectify any
environmental damage for which it is responsible. If it were found that the Fuel Facility Corporations had to contribute
to any remediation costs, each contracting airline would share pro rata, based on system usage, in the costs. For all Fuel
Facility Corporations in Canada in which the Corporation participates, the Corporation has recorded an obligation of $7
($44 undiscounted) representing the present value of the estimated decommissioning and remediation obligations at
the end of the lease using an 8% discount rate, with lease term expiry dates ranging from 2032 to 2039. This estimate
is based on numerous assumptions including the overall cost of decommissioning and remediation and the selection
of alternative decommissioning and remediation approaches. The estimated fair value of the obligation is nil.