Oil and natural gas properties, including related pipelines, are depreciated using a unit-of-production method. The cost of producing wells is amortized over proved developed reserves. License acquisition, common facilities and future decommissioning costs are amortized over total proved reserves. The unit-of-production rate for the depreciation of common facilities takes into account expenditures incurred to date, together with estimated future capital expenditure expected to be incurred relating to as yet undeveloped reserves expected to be processed through these common facilities.
This clearly shows all the estimates involved in setting up a depreciation policy. Not only in a complex environment as the oil and gas industry but also in a manufacturing business consisting of a complex logistical set-up of expensive machinery, and people processing raw materials into finished goods using the machinery, guarding inventories (raw materials, WIP and finished goods), selling the finished goods and registering for all transactions.
However, this makes it all too clear that changing the depreciation method based on changes in one of the many estimates involved in making the estimate for the depreciation policy in the first place is a change in an estimate NOT a change in accounting policy.
This also shows from the IAS 8 definition of change in accounting policy.
Depreciation is an adjustment of the carrying amount of a non-current asset over its useful life to correctly match the cost of usage of that asset with the revenue earned with that usage. And on receipt of information that the previous estimates were wrong regarding devaluation of the asset results in a revision of the depreciation policy.
Additionally, a change in the scrap value of an asset as a result of new developments will also trigger an adjustment in accounting for depreciation and it is also a change of an accounting estimate and not a change in accounting policy (the estimate of the depreciable amount changes).