CNX Resources (CNX) 10-Q 3 Aug 09 2009 Q2 Quarterly report Financial data

Statement Of Income Alternative

Statement Of Income Alternative (USD $)
In Thousands, except Share data	3 Months Ended Jun. 30, 2009	3 Months Ended Jun. 30, 2008	6 Months Ended Jun. 30, 2009	6 Months Ended Jun. 30, 2008
Sales-Outside	$994,141	$1,111,410	$2,144,385	$1,997,735
Sales-Gas Royalty Interests	8,666	22,515	21,298	39,019
Sales-Purchased Gas	1,166	1,647	2,631	5,186
Freight-Outside	27,087	63,927	58,003	108,671
Other Income	39,505	11,397	62,999	86,016
Total Revenue and Other Income	1,070,565	1,210,896	2,289,316	2,236,627
Cost of Goods Sold and Other Operating Charges (exclusive of depreciation, depletion and amortization shown below)	642,856	740,735	1,310,478	1,377,461
Gas Royalty Interests' Costs	6,458	21,880	17,049	37,954
Purchased Gas Costs	390	1,522	1,920	4,943
Freight Expense	27,087	63,927	58,003	108,671
Selling, General and Administrative Expense	35,627	30,644	66,443	61,114
Depreciation, Depletion and Amortization	107,475	95,775	213,694	188,503
Interest Expense	6,945	8,526	15,457	18,704
Taxes Other Than Income	70,472	73,299	148,311	144,905
Total Costs	897,310	1,036,308	1,831,355	1,942,255
Earnings Before Income Taxes	173,255	174,588	457,961	294,372
Income Taxes	54,416	61,798	134,151	97,351
Net Income	118,839	112,790	323,810	197,021
Less: Net Income Attributable to Noncontrolling Interest	(5,500)	(11,778)	(14,652)	(20,927)
Net Income Attributable to CONSOL Energy Inc. Shareholders	$113,339	$101,012	$309,158	$176,094
Basic Earnings Per Share	0.63	0.55	1.71	0.96
Dilutive Earnings Per Share	0.62	0.54	1.69	0.95
Weighted Average Number of Common Shares Outstanding:
Basic	180,644,498	182,977,726	180,610,676	182,775,355
Dilutive	183,073,413	185,637,248	182,833,111	185,330,300
Dividends Paid Per Share	0.1	0.1	0.2	0.2

Statement Of Financial Position

Statement Of Financial Position Classified (USD $)
In Thousands	Jun. 30, 2009	Dec. 31, 2008
Current Assets:
Cash and Cash Equivalents	$108,311	$138,512
Accounts and Notes Receivable:
Trade	180,752	221,729
Other Receivables	20,921	79,552
Inventories	324,655	227,810
Deferred Income Taxes	63,103	60,599
Recoverable Income Taxes	0	33,862
Prepaid Expenses	228,462	221,750
Total Current Assets	926,204	983,814
Property, Plant and Equipment:
Property, Plant and Equipment	10,265,654	9,980,288
Less-Accumulated Depreciation, Depletion and Amortization	4,362,575	4,214,316
Total Property, Plant and Equipment-Net	5,903,079	5,765,972
Other Assets:
Deferred Income Taxes	301,511	333,543
Investment in Affiliates	77,706	72,996
Other	148,800	214,133
Total Other Assets	528,017	620,672
TOTAL ASSETS	7,357,300	7,370,458
Current Liabilities:
Accounts Payable	232,136	385,197
Short-Term Notes Payable	452,000	557,700
Current Portion of Long-Term Debt	22,231	22,401
Accrued Income Taxes	4,891	0
Other Accrued Liabilities	554,190	546,442
Total Current Liabilities	1,265,448	1,511,740
Long-Term Debt:
Long-Term Debt	391,856	393,312
Capital Lease Obligations	69,736	75,039
Total Long-Term Debt	461,592	468,351
Deferred Credits and Other Liabilities:
Postretirement Benefits Other Than Pensions	2,494,054	2,493,344
Pneumoconiosis Benefits	194,984	190,261
Mine Closing	393,653	404,629
Gas Well Plugging	84,114	80,554
Workers' Compensation	131,959	128,477
Salary Retirement	167,587	194,567
Reclamation	21,818	38,193
Other	155,300	185,996
Total Deferred Credits and Other Liabilities	3,643,469	3,716,021
Total Liabilities	5,370,509	5,696,112
Stockholders' Equity:
Common Stock, $.01 par value; 500,000,000 Shares Authorized, 183,014,426 Issued and 180,665,103 Outstanding at June 30, 2009; 183,014,426 Issued and 180,549,851 Outstanding at December 31, 2008	1,830	1,830
Preferred Stock, 15,000,000 Shares Authorized; None Issued and Outstanding	0	0
Capital in Excess of Par Value	1,013,810	993,478
Retained Earnings	1,279,979	1,010,902
Other Comprehensive Loss	(467,193)	(461,900)
Common Stock in Treasury, at Cost-2,349,323 Shares at June 30, 2009 and 2,464,575 Shares at December 31, 2008	(78,150)	(82,123)
Total Consol Energy Inc. Stockholders' Equity	1,750,276	1,462,187
Noncontrolling Interest	236,515	212,159
Total Equity	1,986,791	1,674,346
TOTAL LIABILITIES AND EQUITY	$7,357,300	$7,370,458

1_Statement Of Financial Positi

Statement Of Financial Position Classified (Parenthetical) (USD $)
	Jun. 30, 2009	Dec. 31, 2008
Common Stock, par value	0.01	0.01
Common Stock, Shares Authorized	500,000,000	500,000,000
Common Stock, Issued	183,014,426	183,014,426
Common Stock, Outstanding	180,665,103	180,549,851
Preferred Stock, Shares Authorized	15,000,000	15,000,000
Preferred Stock, Issued	0	0
Preferred Stock, Outstanding	0	0
Common Stock in Treasury, Shares	2,349,323	2,464,575

Statement Of Shareholders Equit

Statement Of Shareholders Equity And Other Comprehensive Income (USD $)
In Thousands	Common Stock	Capital in Excess of Par Value	Retained Earnings (Deficit)	Other Comprehensive Income (Loss)	Treasury Stock	Total Consol Energy, Inc. Stockholders' Equity	Noncontrolling Interest	Total
Beginning Balance at Dec. 31, 2008	$1,830	$993,478	$1,010,902	($461,900)	($82,123)	$1,462,187	$212,159	$1,674,346
Net Income			309,158			309,158	14,652	323,810
Treasury Rate Lock (Net of ($24) tax)				(41)		(41)		(41)
FASB 158 Long-Term Liability Adjustment (Net of $116 tax)				190		190	11	201
Gas Cash Flow Hedge (Net of $4,775 tax)				(5,442)		(5,442)	(1,085)	(6,527)
Comprehensive Income			309,158	(5,293)		303,865	13,578	317,443
Issuance of Treasury Stock			(3,953)		3,973	20		20
Issuance of CNX Gas Stock						0	121	121
Tax Benefit from Stock-Based Compensation		(110)				(110)	(1)	(111)
Amortization of Stock-Based Compensation Awards		16,942				16,942	15,190	32,132
Stock-Based Compensation Awards to CNX Gas		3,500				3,500	(2,916)	584
Net Change in Crown Drilling Noncontrolling Interest						0	(1,616)	(1,616)
Dividends ($0.20 per share)			(36,128)			(36,128)		(36,128)
Ending Balance at Jun. 30, 2009	1,830	1,013,810	1,279,979	(467,193)	(78,150)	1,750,276	236,515	1,986,791
Beginning Balance at Mar. 31, 2009	1,830
Ending Balance at Jun. 30, 2009	$1,830

2_Statement Of Shareholders Equ

Statement Of Shareholders Equity And Other Comprehensive Income (Parenthetical) (USD $)
In Thousands, except Per Share data	Retained Earnings (Deficit)	Other Comprehensive Income (Loss)	Total Consol Energy, Inc. Stockholders' Equity	Noncontrolling Interest	Total
Treasury Rate Lock, tax		($24)	($24)		($24)
FASB 158 Long-Term Liability Adjustment, tax		116	116	116	116
Gas Cash Flow Hedge, tax		$4,775	$4,775	$4,775	$4,775
Dividends, per share	0.2		0.2		0.2

Statement Of Cash Flows Indirec

Statement Of Cash Flows Indirect (USD $)
In Thousands	6 Months Ended Jun. 30, 2009	6 Months Ended Jun. 30, 2008
Operating Activities:
Net Income	$323,810	$197,021
Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities:
Depreciation, Depletion and Amortization	213,694	188,503
Stock-based Compensation	21,783	12,425
Gain on the Sale of Assets	(9,788)	(8,050)
Amortization of Mineral Leases	2,398	3,240
Deferred Income Taxes	34,488	68,996
Equity in Earnings of Affiliates	(6,800)	(3,645)
Changes in Operating Assets:
Accounts Receivable Securitization	0	29,900
Accounts and Notes Receivable	100,554	(110,856)
Inventories	(96,845)	(11,467)
Prepaid Expenses	18,505	19,289
Changes in Other Assets	5,347	13,822
Changes in Operating Liabilities:
Accounts Payable	(64,959)	21,058
Other Operating Liabilities	45,117	11,276
Changes in Other Liabilities	(30,977)	37,739
Other	9,919	726
Net Cash Provided by Operating Activities	566,246	469,977
Investing Activities:
Capital Expenditures	(496,419)	(436,277)
Net Investment in Equity Affiliates	2,090	(819)
Proceeds from Sales of Assets	48,184	17,280
Net Cash Used in Investing Activities	(446,145)	(419,816)
Financing Activities:
Proceeds from (Payments on) Miscellaneous Borrowings	(9,282)	6,307
Payments on Short-Term Borrowings	(105,700)	(40,500)
Tax Benefit from Stock-Based Compensation	397	19,994
Dividends Paid	(36,128)	(36,549)
Issuance of Treasury Stock	611	14,156
Purchases of Treasury Stock	0	(31)
Noncontrolling Interest Member Distribution	(200)	0
Net Cash Used in Financing Activities	(150,302)	(36,623)
Net Increase(Decrease) in Cash and Cash Equivalents	(30,201)	13,538
Cash and Cash Equivalents at Beginning of Period	138,512	41,651
Cash and Cash Equivalents at End of Period	$108,311	$55,189

Notes to Financial Statements

Notes to Financial Statements
	6 Months Ended Jun. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
NOTE 1-BASIS OF PRESENTATION:	NOTE 1BASIS OF PRESENTATION: The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and six months ended June30, 2009 are not necessarily indicative of the results that may be expected for future periods. The balance sheet at December31, 2008 has been derived from the audited consolidated financial statements at that date but does not include all the notes required by generally accepted accounting principles for complete financial statements. For further information, refer to the consolidated financial statements and related notes for the year ended December31, 2008 included in CONSOL Energys Form 10-K. Effective January1, 2009, CONSOL Energy adopted the provisions of Statement of Financial Accounting Standards No.160, Noncontrolling Interests in Consolidated Financial Statementsan Amendment of ARB No.51 (SFAS 160). This adoption resulted in modifications to the reporting of noncontrolling interests in the Consolidated Financial Statements. Additionally, certain reclassifications of prior period data have been made to conform to the three and six months ended June30, 2009 classifications required by SFAS 160. During the three months ended June30, 2009, CONSOL Energy recognized the effect of an exchange offer that allows participants in the CNX Gas Long-Term Incentive Program to exchange their unvested performance share units for CONSOL Energy restricted stock units. The excess fair value of the replacement restricted stock units over the original performance stock units resulted in $2,738 of incremental expense being immediately recognized. Additionally, a liability of $10,347 for the cash settlement of CNX Gas performance share units was removed from the balance sheet. Basic earnings per share are computed by dividing net income by the weighted average shares outstanding during the reporting period. Dilutive earnings per share are computed similarly to basic earnings per share except that the weighted average shares outstanding are increased to include additional shares from the effect of dilutive potential common shares outstanding during the period as calculated in accordance with Statement of Financial Accounting Standard No.123R (SFAS 123R). The number of additional shares is calculated by assuming that restricted stock units and performance share units were converted and outstanding stock options were exercised and that the proceeds from such activity were used to acquire shares of common stock at the average market price during the reporting period. Options to purchase 1,659,105 and 1,659,695 shares of common stock were outstanding for the three and six months ended June30, 2009, respectivel
NOTE 2-ACQUISITIONS AND DISPOSITIONS:	NOTE 2ACQUISITIONS AND DISPOSITIONS: In June 2009, CONSOL Energy recognized the fair value of the remaining lease payments in the amount of $11,848 in accordance with Statement of Financial Accounting Standards No.146 (SFAS 146), Accounting for Costs Associated with Exit or Disposal Activities, related to the Companys previous headquarters. This liability has been recorded in Other Liabilities on the consolidated balance sheet at June30, 2009. Total expense related to this transaction was $13,374 which was recognized in Cost of Goods Sold and Other Operating Charges. This amount includes the fair value of the remaining lease payments of $11,848 as well as the removal of a related asset of $1,526. Additionally, $5,832 was recognized in Other Income for the acceleration of a deferred gain associated with the initial sale-leaseback of the premises that occurred in 2005. In June 2009, CONSOL Energy recognized the fair value of the remaining lease payments partially offset by projected sublease income in the amount of $831 in accordance with SFAS 146 related to a subsidiarys previous headquarters. This liability has been recorded in Other Liabilities on the consolidated balance sheet at June30, 2009. Total expense related to this transaction was $824 which was recognized in Cost of Goods Sold and Other Operating Charges. This amount includes the fair value of the remaining lease payments offset by projected sublease income of $831 and the removal of the tenant improvement asset and related liability of $7. In February 2009, CONSOL Energy completed a sale/lease-back of longwall shields for Bailey Mine. Cash proceeds from the sale were $42,282, which was the same as our basis in the equipment. Accordingly, no gain or loss was recognized on the transaction. The lease has been accounted for as an operating lease. The lease term is five years. In December 2008, CONSOL Energy, through a subsidiary, completed the acquisition of the outstanding 51% interest in Southern West Virginia Energy, LLC (SWVE) for a cash payment of $11,521. This amount is included in capital expenditures in cash used in investing activities on the Consolidated Statement of Cash Flows. The purchase price was principally allocated to property, plant and equipment. SWVE wholly-owns Southern West Virginia Resources, LLC and Minway Contracting, LLC, and had previously been a 49% subsidiary of CONSOL Energy. Prior to the acquisition of the outstanding interest, SWVE had been fully consolidated in accordance with Financial Accounting Standards Board Interpretation No.46, Consolidation of Variable Interest Entities by CONSOL Energy. The proforma results for this acquisition are not material to CONSOL Energys financial results. In November 2008, CONSOL Energy, through a subsidiary, completed the acquisition of the assets of North Penn Pipe Supply, Inc. for a cash payment, net of cash acquired, of $22,550. This amount is included in capital expenditures in cash used in investing activities on the Consolidated Statements of Cash Flows. North Penn Pipe Supply, Inc. is a distributor of oil and gas field equipment, primarily tubular goods, to the northern Appalachian Basin, a
NOTE 3-COMPONENTS OF PENSION AND OTHER POSTRETIREMENT BENEFIT PLANS NET PERIODIC BENEFIT COSTS:	NOTE 3COMPONENTS OF PENSION AND OTHER POSTRETIREMENT BENEFIT PLANS NET PERIODIC BENEFIT COSTS: Components of net periodic costs for the three and six months ended June30 are as follows: Pension Benefits Other Benefits ThreeMonthsEnded June30, Six Months Ended June30, Three Months Ended June30, Six Months Ended June30, 2009 2008 2009 2008 2009 2008 2009 2008 Service cost $ 3,302 $ 2,438 $ 6,169 $ 4,876 $ 2,949 $ 2,639 $ 6,327 $ 5,277 Interest cost 9,082 8,257 17,741 16,515 35,991 39,959 75,726 79,919 Expected return on plan assets (9,245 ) (8,418 ) (18,315 ) (16,835 ) Amortization of prior service costs (credit) (277 ) (279 ) (554 ) (557 ) (11,604 ) (12,157 ) (23,207 ) (24,313 ) Recognized net actuarial loss 5,692 4,182 11,131 8,363 10,209 15,376 25,178 30,752 Net periodic benefit cost $ 8,554 $ 6,180 $ 16,172 $ 12,362 $ 37,545 $ 45,817 $ 84,024 $ 91,635 For the six months ended June30, 2009, $33,208 of contributions to pension trusts and pension benefits have been paid from operating cash flows. CONSOL Energy presently anticipates contributing a total of $65,600 to the pension trust in 2009. We do not expect to contribute to the other post employment benefit plan in 2009. We intend to pay benefit claims as they become due. For the six months ended June30, 2009, $77,611 of other post employment benefits have been paid.
NOTE 4-COMPONENTS OF COAL WORKERS' PNEUMOCONIOSIS (CWP) AND WORKERS' COMPENSATION NET PERIODIC BENEFIT COSTS:	NOTE 4COMPONENTS OF COAL WORKERS PNEUMOCONIOSIS (CWP) AND WORKERS COMPENSATION NET PERIODIC BENEFIT COSTS: Components of net periodic costs (benefits) for the three and six months ended June30 are as follows: CWP Workers Compensation ThreeMonthsEnded June30, Six Months Ended June30, Three Months Ended June30, Six Months Ended June30, 2009 2008 2009 2008 2009 2008 2009 2008 Service cost $ 1,769 $ 1,259 $ 3,537 $ 2,518 $ 7,099 $ 7,258 $ 14,197 $ 14,515 Interest cost 3,013 2,937 6,027 5,874 2,191 2,082 4,382 4,164 Amortization of actuarial gain (5,079 ) (6,027 ) (10,159 ) (12,056 ) (1,050 ) (1,235 ) (2,100 ) (2,468 ) State administrative fees and insurance bond premiums 1,793 1,750 3,552 3,041 Legal and administrative costs 675 675 1,350 1,350 850 806 1,701 1,612 Net periodic (benefit) cost $ 378 $ (1,156 ) $ 755 $ (2,314 ) $ 10,883 $ 10,661 $ 21,732 $ 20,864 CONSOL Energy does not expect to contribute to the CWP plan in 2009. We intend to pay benefit claims as they become due. For the six months ended June30, 2009, $5,948 of CWP benefit claims have been paid. CONSOL Energy does not expect to contribute to the workers compensation plan in 2009. We intend to pay benefit claims as they become due. For the six months ended June30, 2009, $18,604 of workers compensation benefits, state administrative fees and surety bond premiums have been paid.
NOTE 5-INCOME TAXES:	NOTE 5INCOME TAXES: The following is reconciliation, stated in dollars as a percentage of pretax income, of the U.S. statutory federal income tax rate to CONSOL Energys effective tax rate: For the Six Months Ended June30, 2009 2008 Amount Percent Amount Percent Statutory U.S. federal income tax rate $ 160,286 35.0 % $ 103,030 35.0 % Excess tax depletion (38,927 ) (8.5 ) (18,163 ) (6.2 ) Effect of Domestic Production Activities Deduction (7,327 ) (1.6 ) (1,472 ) (0.5 ) Effect of Medicare Prescription Drug, Improvement and Modernization Act of 2003 1,374 0.3 589 0.2 Net Effect of state tax 18,318 4.0 11,304 3.8 Other 427 0.1 2,063 0.7 Income Tax Expense / Effective Rate $ 134,151 29.3 % $ 97,351 33.0 % The effective tax rate for the six months ended June30, 2009 and 2008 was calculated using the annual effective rate projection on recurring earnings and includes tax liabilities related to certain discrete transactions. During the three months ended June30, 2009 and 2008, CONSOL Energy reduced its liability for unrecognized tax benefits by $15,711 and $7,899, respectively. The reduction in unrecognized tax benefits for the three months ended June30, 2009 was the result of the payment of Federal and state income tax deficiencies related to the Internal Revenue Services (IRS) examination of the Companys 2004 and 2005 tax returns and the use of state operating loss carry forwards to reduce the anticipated state tax deficiencies arising from the IRS changes to taxable income for these years. The reduction in unrecognized tax benefits for the three months ended June30, 2008 was attributable to the successful resolution of certain tax issues raised by the IRS during its examination of the Companys 2004 and 2005 tax returns. The total amounts of unrecognized tax benefits at June30, 2009 and 2008 were $44,980 and $55,622, respectively. If these unrecognized tax benefits were recognized approximately $14,657 and $12,600 would affect CONSOL Energys effective tax rate for the six months ended June30, 2009 and 2008, respectively. CONSOL Energy Inc. and its subsidiaries file income tax returns in the U.S. federal, various states, and Canadian tax jurisdictions. With few exceptions, the Company is no longer subject to U.S. federal, state and local, or non-U.S. income tax examinations by tax authorities for years before 2002. The Internal Revenue Service has issued its audit report relating to the examination of CONSOL Energys 2004 and 2005 U.S. income tax returns. During the three months ended June30, 2009, CONSOL Energy paid Federal and state income tax deficiencies of $12,798 and $608, respectively. The Federal and state income tax deficiencies paid as a result of the IRS examination of the Companys 2004 and 2005 tax returns had an insignificant impact on net income since the tax deficiencies are the result of changes in the timing of certain tax deductions. During the six months ended
NOTE 6-INVENTORIES:	NOTE 6INVENTORIES: Inventory components consist of the following: June30, 2009 December31, 2008 Coal $ 176,193 $ 93,875 Merchandise for resale 58,347 43,074 Supplies 90,115 90,861 Total Inventories $ 324,655 $ 227,810 Merchandise for resale is valued using the Last In First Out (LIFO) cost method. The excess of replacement cost of merchandise for resale inventories over carrying LIFO value was $9,934 and $14,716 at June30, 2009 and December31, 2008, respectively.
NOTE 7-ACCOUNTS RECEIVABLE SECURITIZATION:	NOTE 7ACCOUNTS RECEIVABLE SECURITIZATION: CONSOL Energy and certain of our U.S. subsidiaries are party to a trade accounts receivable facility with financial institutions for the sale on a continuous basis of eligible trade accounts receivable. The facility allows CONSOL Energy to receive on a revolving basis, up to $165,000. The facility also allows for the issuance of letters of credit against the $165,000 capacity. At June30, 2009, there were no letters of credit outstanding against the facility. CONSOL Energy formed CNX Funding Corporation, a wholly owned, special purpose, bankruptcy-remote subsidiary for the sole purpose of buying and selling eligible trade receivables generated by certain subsidiaries of CONSOL Energy. Under the receivables facility, CONSOL Energy and certain subsidiaries, irrevocably and without recourse, sell all of their eligible trade accounts receivable to financial institutions and their affiliates, while maintaining a subordinated interest in a portion of the pool of trade receivables. This retained interest, which is included in Accounts and Notes Receivable Trade in the Consolidated Balance Sheets, is recorded at fair value. Due to a short average collection cycle for such receivables, our collection experience history and the composition of the designated pool of trade accounts receivable that are part of this program, the fair value of our retained interest approximates the total amount of the designated pool of accounts receivable reduced by the amount of accounts receivables sold to the third-party financial institutions under the program. CONSOL Energy will continue to service the sold trade receivables for the financial institutions for a fee based upon market rates for similar services. The cost of funds under this facility is based upon commercial paper rates, plus a charge for administrative services paid to the financial institutions. Costs associated with the receivables facility totaled $833 and $1,768 for the three and six months ended June30, 2009. Costs associated with the receivables facility totaled $1,285 and $2,862 for the three and six months ended June30, 2008. These costs have been recorded as financing fees which are included in Cost of Goods Sold and Other Operating Charges in the Consolidated Statements of Income. No servicing asset or liability has been recorded. The receivables facility expires in April 2012 with the underlying liquidity agreement renewing annually each April. At June30, 2009 and 2008, eligible accounts receivable totaled approximately $165,000. There was no subordinated retained interest at June30, 2009. The subordinated retained interest approximated $9,700 at June30, 2008. Accounts receivable totaling $165,000 and $155,300 were removed from the Consolidated Balance Sheet at June30, 2009 and 2008, respectively. CONSOL Energys $29,900 increase in the accounts receivable securitization program for the six months ended June30, 2008 is reflected in cash flows from operating activities in the Consolidated Statement of Cash Flows. There was no change in the facility usage in the six months ended June30, 2009.
NOTE 8-PROPERTY, PLANT AND EQUIPMENT:	NOTE 8PROPERTY, PLANT AND EQUIPMENT: The components of property, plant and equipment are as follows: June30, 2009 December31, 2008 Coal other plant and equipment $ 4,620,840 $ 4,533,793 Coal properties and surface lands 1,257,956 1,264,920 Gas properties and related development 1,563,172 1,427,588 Gas gathering equipment 780,804 740,396 Airshafts 608,484 615,512 Leased coal lands 510,858 502,521 Mine development 549,878 527,991 Coal advance mining royalties 371,272 365,380 Gas advance royalties 2,390 2,187 Total property, plant and equipment 10,265,654 9,980,288 Less Accumulated depreciation, depletion and amortization 4,362,575 4,214,316 Total Net Property, Plant and Equipment $ 5,903,079 $ 5,765,972
NOTE 9-SHORT-TERM NOTES PAYABLE:	NOTE 9SHORT-TERM NOTES PAYABLE: CONSOL Energy has a five-year $1,000,000 senior secured credit facility, which extends through June 2012. The facility is secured by substantially all of the assets of CONSOL Energy and certain of its subsidiaries and collateral is shared equally and ratably with the holders of CONSOL Energy Inc. 7.875% bonds maturing in 2012. The Agreement does provide for the release of collateral at the request of CONSOL Energy upon achievement of certain credit ratings. Fees and interest rate spreads are based on a ratio of financial covenant debt to twelve-month trailing earnings before interest, taxes, depreciation, depletion and amortization (EBITDA), measured quarterly. The facility includes a minimum interest coverage ratio covenant of no less than 4.50 to 1.00, measured quarterly. The interest coverage ratio was 24.44 to 1.00 at June30, 2009. The facility also includes a maximum leverage ratio covenant of not more than 3.25 to 1.00, measured quarterly. The leverage ratio was 0.93 to 1.00 at June30, 2009. Affirmative and negative covenants in the facility limit our ability to dispose of assets, make investments, purchase or redeem CONSOL Energy common stock, pay dividends and merge with another corporation. At June30, 2009, the $1,000,000 facility had $371,000 of borrowings outstanding and $268,176 of letters of credit outstanding, leaving $360,824 of capacity available for borrowings and the issuance of letters of credit. The facility bore a weighted average interest rate of 1.21% for the six months ended June30, 2009. CNX Gas has a five-year $200,000 unsecured credit agreement which extends through October 2010. The agreement contains a negative pledge provision, whereas CNX Gas assets cannot be used to secure other obligations. Fees and interest rate spreads are based on the percentage of facility utilization, measured quarterly. Covenants in the facility limit CNX Gas ability to dispose of assets, make investments, purchase or redeem CNX Gas stock, pay dividends and merge with another corporation. The facility includes a maximum leverage ratio covenant of not more than 3.00 to 1.00, measured quarterly. The leverage ratio was 0.35 to 1.00 at June30, 2009. The facility also includes a minimum interest coverage ratio covenant of no less than 3.00 to 1.00, measured quarterly. This ratio was 68.35 to 1.00 at June30, 2009. At June30, 2009, the CNX Gas credit agreement had $81,000 of borrowings outstanding and $14,933 of letters of credit outstanding, leaving $104,067 of capacity available for borrowings and the issuance of letters of credit. The facility bore a weighted average interest rate of 1.50% for the six months ended June30, 2009.
NOTE 10-COMMITMENTS AND CONTINGENCIES:	NOTE 10COMMITMENTS AND CONTINGENCIES: CONSOL Energy and its subsidiaries are subject to various lawsuits and claims with respect to such matters as personal injury, wrongful death, damage to property, exposure to hazardous substances, governmental regulations including environmental remediation, employment and contract disputes and other claims and actions arising out of the normal course of business. Our current estimates related to these pending claims, individually and in the aggregate, are immaterial to the financial position, results of operations or cash flows of CONSOL Energy. However, it is reasonably possible that the ultimate liabilities in the future with respect to these lawsuits and claims may be material to the financial position, results of operations or cash flows of CONSOL Energy. On January30, 2008, the Pennsylvania Department of Conservation and Natural Resources filed a six-count Complaint in the Court of Common Pleas of Allegheny County, Pennsylvania, asserting claims in both tort and contract against the Company for alleged damage to park property owned by the Commonwealth allegedly due to the Companys underground mining activities. The Commonwealth claims that the Companys underground longwall mining activities in the summer of 2005 in Greene County, Pennsylvania, caused cracks and seepage damage to the nearby Ryerson Park Dam. The Commonwealth demolished the Ryerson Dams spillway allegedly to protect persons and property, thereby eliminating the Ryerson Park lake. The Commonwealth claims that the Company is liable for dam reconstruction costs, lake restoration costs and natural resources damages totaling $58,000. The theories of liability include general allegations of negligence, breach of contract, strict liability, nuisance, an administrative remedy claim under the Bituminous Mine Subsidence Act and a claim of fraud; the last claim seeking punitive damages. The Court, in ruling on the Companys Preliminary Objections to the Complaint, stayed the current proceedings in the state court, holding that the Commonwealth should pursue administrative agency review of the claim because full compensatory relief, if warranted, could be provided by the particular administrative agency and then the Environmental Hearing Board, if further relief was sought. Furthermore, the Court found that the Commonwealth could not recover natural resources damages under applicable law. The remainder of the Companys objections was preserved pending the outcome of the administrative proceedings. The matter is in the early stages of review by the Department of Environmental Protection (DEP). The DEP has set specific dates for the submission of materials regarding the issue of causation with August3, 2009 being the date for replying to several written inquiries from the DEP. The DEP will likely issue its causation decision prior to year end. The Company has submitted extensive material, including comments from its mining expert that longwall mining activity did not cause damage to the dam. If the DEP determines that there is causation, a second phase will be set to determine the remedy. As to the underlying claim, the Company believes it is
NOTE 11-DERIVATIVES	NOTE 11DERIVATIVES CONSOL Energy enters into financial derivative instruments to manage our exposure to commodity price volatility. Our derivatives are accounted for under Statement of Financial Accounting Standards No.133, Accounting for Derivative Instruments and Hedging Activities (SFAS 133), as amended. We measure every derivative instrument at fair value and record it on the balance sheet as either an asset or liability. Changes in the fair value of the derivatives are recorded currently in earnings unless special hedge accounting criteria are met. For derivatives designated as fair value hedges, the changes in fair value of both the derivative instrument and the hedged item are recorded in earnings. For derivatives designated as cash flow hedges, the effective portions of changes in fair value of the derivative are reported in other comprehensive income or loss and reclassified into earnings in the same period or periods which the forecasted transaction affects earnings. The ineffective portions of hedges are recognized in earnings in the current year. CONSOL Energy currently utilizes only cash flow hedges that are considered highly effective. CONSOL Energy formally assesses both at inception of the hedge and on an ongoing basis, whether each derivative is highly effective in offsetting changes in the fair values or the cash flows of the hedged item. If it is determined that a derivative is not highly effective as a hedge or if a derivative ceases to be a highly effective hedge, CONSOL Energy will discontinue hedge accounting prospectively. CONSOL Energy is exposed to credit risk in the event of nonperformance by counterparties. The creditworthiness of counterparties is subject to continuing review. All of the counterparties to CONSOL Energys natural gas derivative instruments also participate in CONSOL Energys revolving credit facility. The Company has not experienced any issues of non-performance by derivative counterparties. CONSOL Energy has entered into forward and option contracts on various commodities to manage the price risk associated with the forecasted revenues from those commodities. The objective of these hedges is to reduce the variability of the cash flows associated with the forecasted revenues from the underlying commodities. As of June30, 2009, the total notional amount of the Companys outstanding natural gas forward contracts was 96.3 Bcf. These forward contracts are forecasted to settle through December31, 2012 and meet the criteria for cash flow hedge accounting prescribed under SFAS 133. During the next twelve months, $106,452 of unrealized gain is expected to be reclassified from other comprehensive income and into earnings. No gains or losses have been reclassified into earnings as a result of the discontinuance of cash flow hedges. As of June30, 2009, the total notional amount of the Companys outstanding coal sales options was 138 tons. These options do not qualify for hedge accounting under SFAS 133 and are expected to settle or expire over the next six months. The fair value of CONSOL Energys derivative instruments at June30, 2009 is as follows: Asset Derivative
NOTE 12-OTHER COMPREHENSIVE INCOME:	NOTE 12OTHER COMPREHENSIVE INCOME: Total comprehensive income, net of tax, for the six months ended June30, 2009 was as follows: Treasury Rate Lock Changein FairValue ofCashFlow Hedges Adjustments forSFAS158 Accumulated Other Comprehensive Loss Balance at December31, 2008 $ 263 $ 102,625 $ (564,788 ) $ (461,900 ) Net increase in value of cash flow hedges 91,112 91,112 Reclassification of cash flow hedges from other comprehensive income to earnings (96,554 ) (96,554 ) Current period change (41 ) 190 149 Comprehensive Income 222 97,183 (564,598 ) (467,193 ) Comprehensive income attributable to Noncontrolling Interest (1,085 ) 11 (1,074 ) Balance at June30, 2009 $ 222 $ 96,098 $ (564,587 ) $ (468,267 )
NOTE 13-FAIR VALUE OF FINANCIAL INSTRUMENTS:	NOTE 13FAIR VALUE OF FINANCIAL INSTRUMENTS: The financial instruments measured at fair value on a recurring basis are summarized below: Fair Value Measurements at June30, 2009 Description QuotedPricesin Active Markets for Identical Instruments (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Gas Cash Flow Hedges $ $ 194,337 $ Coal Sales Options $ $ (30 ) $ Statement of Financial Accounting Standards No.107, Disclosures About Fair Value of Financial Instruments (SFAS 107) requires the disclosure of the estimated fair value of financial instruments including those financial instruments for which the Statement of Financial Accounting Standard No.159, The Fair Value Option for Financial Assets and Financial Liabilities (SFAS 159) fair value option was not elected. The following methods and assumptions were used to estimate the fair value of those financial instruments: Cash and cash equivalents: The carrying amount reported in the balance sheets for cash and cash equivalents approximates its fair value due to the short maturity of these instruments. Short-term notes payable: The carrying amount reported in the balance sheets for short-term notes payable approximates its fair value due to the short-term maturity of these instruments. Long-term debt: The fair values of long-term debt are estimated using discounted cash flow analyses, based on CONSOL Energys current incremental borrowing rates for similar types of borrowing arrangements. The carrying amounts and fair values of financial instruments for which SFAS 159 was not elected are as follows: June30, 2009 December31, 2008 Carrying Amount Fair Value Carrying Amount Fair Value Cash and cash equivalents $ 108,311 $ 108,311 $ 138,512 $ 138,512 Short-term notes payable $ (452,000 ) $ (452,000 ) $ (557,700 ) $ (557,700 ) Long-term debt $ (400,013 ) $ (406,149 ) $ (402,287 ) $ (390,278 )
NOTE 14-SEGMENT INFORMATION:	NOTE 14SEGMENT INFORMATION: CONSOL Energy has two principal business units: Coal and Gas. The principal activities of the Coal unit are mining, preparation and marketing of steam coal, sold primarily to power generators, and metallurgical coal, sold to metal and coke producers. The Coal unit includes four reportable segments. These reportable segments are Northern Appalachian, Central Appalachian, Metallurgical and Other Coal. Each of these reportable segments includes a number of operating segments (mines). For the six months ended June30, 2009, the Northern Appalachian aggregated segment includes the following mines: Blacksville #2, Robinson Run, McElroy, Loveridge, Bailey, Enlow Fork, Shoemaker and Mine 84. For the six months ended June30, 2009, the Central Appalachian aggregated segment includes the following mines: Jones Fork, the Fola Complex, the Miller Creek Complex and the Terry Eagle Complex. For the six months ended June30, 2009, the Metallurgical aggregated segment includes the Buchanan and Amonate mines. The Other Coal segment includes our purchased coal activities, idled mine cost, coal segment business units not meeting aggregation criteria, as well as various other activities assigned to the coal segment but not allocated to each individual mine. The principal activity of the Gas unit is to produce pipeline quality methane gas for sale primarily to gas wholesalers. CONSOL Energys All Other classification is made up of the Companys terminal services, river and dock services, industrial supply services and other business activities, including rentals of buildings and flight operations. Intersegment sales have been recorded at amounts approximating market. Operating profit for each segment is based on sales less identifiable operating and non-operating expenses. Certain reclassifications of 2008 segment information have been made to conform to the 2009 presentation. Reclassifications include changes between mines reflected in Central Appalachian and Other Coal segments to reflect the current aggregation criteria. Industry segment results for the three months ended June30, 2009: Northern Appalachian Central Appalachian Metallurgical Other Coal Total Coal Gas All Other Corporate, Adjustments Eliminations Consolidated Salesoutside $ 618,034 $ 125,382 $ 16,419 $ 23,031 $ 782,866 $ 150,759 $ 60,516 $ $ 994,141 SalesGas Royalty Interests 8,666 8,666 SalesPurchased Gas 1,166 1,166 Freightoutside 27,087 27,087 27,087 Intersegment transfers 107 37,664 (37,771 ) Total Sales and Freight $ 618,034 $ 125,382 $ 16,419 $ 50,118 $ 809,953 $ 160,698 $ 98,180 $ (37,771 ) $ 1,031,060 Earnings (Loss) Before Income Taxes (A) $ 165,020 $ 23,439 $ (40,250 ) $ 1,517 $ 149,726
NOTE 15-GUARANTOR SUBSIDIARIES FINANCIAL INFORMATION:	NOTE 15GUARANTOR SUBSIDIARIES FINANCIAL INFORMATION: The payment obligations under the $250,000, 7.875%per annum notes due March1, 2012 issued by CONSOL Energy are jointly and severally, and also fully and unconditionally guaranteed by several subsidiaries of CONSOL Energy. In accordance with positions established by the Securities and Exchange Commission (SEC), the following financial information sets forth separate financial information with respect to the parent, CNX Gas, an 83.3% owned guarantor subsidiary, the remaining guarantor subsidiaries and the non-guarantor subsidiaries. CNX Gas is presented in a separate column in accordance with SEC Regulation S-X Rule 3-10. CNX Gas Corporation is a reporting company under Section12(b) of the Securities Exchange Act of 1933, and as such, CNX Gas Corporation files its own financial statements with the Securities and Exchange Commission and those financial statements, when filed, are publicly available on Edgar. The principal elimination entries include investments in subsidiaries and certain intercompany balances and transactions. CONSOL Energy, the parent, and a guarantor subsidiary manage several assets and liabilities of all other 100% owned subsidiaries. These include, for example, deferred tax assets, cash and other post-employment liabilities. These assets and liabilities are reflected as parent company or guarantor company amounts for purposes of this presentation. Income Statement for the three months ended June30, 2009: Parent Issuer CNX Gas Guarantor Other Subsidiary Guarantors Non- Guarantors Elimination Consolidated SalesOutside $ $ 150,863 $ 799,027 $ 44,686 $ (435 ) $ 994,141 SalesPurchased Gas 1,166 1,166 SalesGas Royalty Interests 8,666 8,666 FreightOutside 27,087 27,087 Other Income (including equity earnings) 140,605 913 26,225 5,669 (133,907 ) 39,505 Total Revenue and Other Income 140,605 161,608 852,339 50,355 (134,342 ) 1,070,565 Cost of Goods Sold and Other Operating Charges 28,843 53,360 463,940 43,993 53,068 643,204 Purchased Gas Costs 390 390 Gas Royalty Interests Costs 6,470 (12 ) 6,458 Related Party Activity 2,972 33,288 359 (36,619 ) Freight Expense 27,087 27,087 Selling, General and Administrative Expense 18,366 32,473 341 (15,553 ) 35,627 Depreciation, Depletion and Amortization 3,284 24,883 78,643 665 107,475 Interest Expense 3,147 1,931 1,951 4 (88 ) 6,945 Taxes Other Than Income 1,536 3,406 64,831 699 70,472 Black Lung Excise Tax Refund (348 ) (348 ) Total Costs 39,782 108,806 7
NOTE 16-RECENT ACCOUNTING PRONOUNCEMENTS:	NOTE 16RECENT ACCOUNTING PRONOUNCEMENTS: In June 2009, the FASB issued Statement of Financial Accounting Standards No.166, Accounting for Transfers of Financial Assetsan amendment of FASB Statement No.140 (SFAS 166), that is designed to improve the relevance, representational faithfulness, and comparability of the information that a reporting entity provides in its financial statements about a transfer of financial assets; the effects of a transfer on its financial position, financial performance, and cash flows; and a transferors continuing involvement, if any, in transferred financial assets. SFAS 166 enhances the information provided to financial statement users to provide greater transparency about transfers of financial assets and a transferors continuing involvement, if any, with transferred financial assets. SFAS 166 requires enhanced disclosures about the risks that a transferor continues to be exposed to because of its continuing involvement in transferred financial assets. This Statement is effective for an entitys first annual reporting period after November15, 2009. Management is currently assessing this guidance to determine the impact on CONSOL Energy.

Document Information

Document Information
	6 Months Ended Jun. 30, 2009 USD / shares
Document Information [Text Block]
Document Type	10-Q
Amendment Flag	false
Amendment Description	N.A.
Document Period End Date	2009-06-30

Entity Information

Entity Information (USD $)
	6 Months Ended Jun. 30, 2009	Jul. 24, 2009	Jun. 30, 2008
Entity [Text Block]
Trading Symbol	CNX
Entity Registrant Name	CONSOL ENERGY INC
Entity Central Index Key	0001070412
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	Yes
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		180,700,590
Entity Public Float			$20,580,593,930