Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Feb. 24, 2023 | Jun. 30, 2022 | |
Document and Entity Information | |||||
Document Type | 10-K | ||||
Document Annual Report | true | ||||
Document Transition Report | false | ||||
Document Period End Date | Dec. 31, 2022 | ||||
Entity File Number | 0-26823 | ||||
Entity Registrant Name | ALLIANCE RESOURCE PARTNERS LP | ||||
Entity Incorporation, State or Country Code | DE | ||||
Entity Tax Identification Number | 73-1564280 | ||||
Entity Address, Address Line One | 1717 South Boulder Avenue, Suite 400 | ||||
Entity Address, City or Town | Tulsa | ||||
Entity Address, State or Province | OK | ||||
Entity Address, Postal Zip Code | 74119 | ||||
City Area Code | 918 | ||||
Local Phone Number | 295-7600 | ||||
Title of 12(b) Security | Common Units | ||||
Trading Symbol | ARLP | ||||
Security Exchange Name | NASDAQ | ||||
Entity Well-known Seasoned Issuer | Yes | ||||
Entity Voluntary Filers | No | ||||
Entity Current Reporting Status | Yes | ||||
Entity Interactive Data Current | Yes | ||||
Entity Filer Category | Large Accelerated Filer | ||||
Entity Small Business | false | ||||
Entity Emerging Growth Company | false | ||||
ICFR Auditor Attestation Flag | true | ||||
Entity Shell Company | false | ||||
Entity Common Units Outstanding | 127,198,650 | ||||
Entity Public Float | $ 1,929,455,252 | ||||
Auditor Name | GRANT THORNTON LLP | GRANT THORNTON LLP | Ernst & Young LLP | ||
Auditor Firm ID | 248 | 248 | 42 | ||
Auditor Location | Tulsa, Oklahoma | Tulsa, Oklahoma | Tulsa, Oklahoma | ||
Entity Central Index Key | 0001086600 | ||||
Current Fiscal Year End Date | --12-31 | ||||
Document Fiscal Year Focus | 2022 | ||||
Document Fiscal Period Focus | FY | ||||
Amendment Flag | false |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
CURRENT ASSETS: | ||
Cash and cash equivalents | $ 296,023 | $ 122,403 |
Trade receivables | 238,610 | 129,531 |
Other receivables | 8,601 | 680 |
Inventories, net | 77,326 | 60,302 |
Advance royalties | 7,556 | 4,958 |
Prepaid expenses and other assets | 26,675 | 21,354 |
Total current assets | 654,791 | 339,228 |
PROPERTY, PLANT AND EQUIPMENT: | ||
Property, plant and equipment, at cost | 3,857,390 | 3,608,347 |
Less accumulated depreciation, depletion and amortization | (2,040,468) | (1,909,669) |
Total property, plant and equipment, net | 1,816,922 | 1,698,678 |
OTHER ASSETS: | ||
Advance royalties | 67,713 | 63,524 |
Equity method investments | 49,371 | 26,325 |
Equity securities | 42,000 | |
Operating lease right-of-use assets | 14,950 | 14,158 |
Other long-term assets | 15,726 | 17,493 |
Total other assets | 189,760 | 121,500 |
TOTAL ASSETS | 2,661,473 | 2,159,406 |
CURRENT LIABILITIES: | ||
Accounts payable | 95,122 | 69,586 |
Accrued taxes other than income taxes | 22,967 | 17,787 |
Accrued payroll and related expenses | 39,623 | 36,805 |
Accrued interest | 5,000 | 5,000 |
Workers' compensation and pneumoconiosis benefits | 14,099 | 12,293 |
Other current liabilities | 53,790 | 20,035 |
Current maturities, long-term debt, net | 24,970 | 16,071 |
Total current liabilities | 255,571 | 177,577 |
LONG-TERM LIABILITIES: | ||
Long-term debt, excluding current maturities, net | 397,203 | 418,942 |
Pneumoconiosis benefits | 100,089 | 107,560 |
Accrued pension benefit | 12,553 | 25,590 |
Workers' compensation | 39,551 | 44,911 |
Asset retirement obligations | 142,254 | 123,517 |
Long-term operating lease obligations | 12,132 | 12,366 |
Deferred income tax liabilities | 35,814 | 391 |
Other liabilities | 24,828 | 22,483 |
Total long-term liabilities | 764,424 | 755,760 |
Total liabilities | 1,019,995 | 933,337 |
COMMITMENTS AND CONTINGENCIES - (Note 23) | ||
ARLP Partners' Capital: | ||
Limited Partners - Common Unitholders 127,195,219 units outstanding | 1,656,025 | 1,279,183 |
Accumulated other comprehensive loss | (41,054) | (64,229) |
Total ARLP Partners' Capital | 1,614,971 | 1,214,954 |
Noncontrolling interest | 26,507 | 11,115 |
Total Partners' Capital | 1,641,478 | 1,226,069 |
TOTAL LIABILITIES AND PARTNERS' CAPITAL | $ 2,661,473 | $ 2,159,406 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - shares | Dec. 31, 2022 | Dec. 31, 2021 |
CONSOLIDATED BALANCE SHEETS | ||
Common units outstanding | 127,195,219 | 127,195,219 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
SALES AND OPERATING REVENUES: | |||
Revenues | $ 2,406,511 | $ 1,569,976 | $ 1,328,129 |
EXPENSES: | |||
Outside coal purchases | 151 | 6,372 | |
General and administrative | 80,334 | 70,160 | 59,806 |
Depreciation, depletion and amortization | 273,759 | 261,377 | 313,387 |
Settlement gain | (6,664) | ||
Asset impairments | 24,977 | ||
Goodwill impairment | 0 | 0 | 132,026 |
Total operating expenses | 1,748,075 | 1,350,773 | 1,410,981 |
INCOME (LOSS) FROM OPERATIONS | 658,436 | 219,203 | (82,852) |
Interest expense (net of interest capitalized of $922, $396 and $1,325, respectively) | (37,332) | (39,229) | (45,613) |
Interest income | 2,035 | 88 | 135 |
Equity method investment income | 5,634 | 2,130 | 907 |
Other income (expense) | 4,353 | (3,020) | (1,593) |
INCOME (LOSS) BEFORE INCOME TAXES | 633,126 | 179,172 | (129,016) |
INCOME TAX EXPENSE | 53,978 | 417 | 35 |
NET INCOME (LOSS) | 579,148 | 178,755 | (129,051) |
LESS: NET INCOME ATTRIBUTABLE TO NONCONTROLLING INTEREST | (1,958) | (598) | (169) |
NET INCOME (LOSS) ATTRIBUTABLE TO ARLP | $ 577,190 | $ 178,157 | $ (129,220) |
EARNINGS PER LIMITED PARTNER UNIT - BASIC (in dollars per unit) | $ 4.39 | $ 1.36 | $ (1.02) |
EARNINGS PER LIMITED PARTNER UNIT - DILUTED (in dollars per unit) | $ 4.39 | $ 1.36 | $ (1.02) |
WEIGHTED-AVERAGE NUMBER OF UNITS OUTSTANDING - BASIC (in units) | 127,195,219 | 127,195,219 | 127,164,659 |
WEIGHTED-AVERAGE NUMBER OF UNITS OUTSTANDING - DILUTED (in units) | 127,195,000 | 127,195,000 | 127,165,000 |
Product | |||
EXPENSES: | |||
Operating expenses (excluding depreciation, depletion and amortization) | $ 1,286,635 | $ 943,257 | $ 859,656 |
Coal sales | |||
SALES AND OPERATING REVENUES: | |||
Revenues | 2,102,229 | 1,386,923 | 1,232,272 |
Oil & gas royalties | |||
SALES AND OPERATING REVENUES: | |||
Revenues | 138,402 | 74,988 | 42,912 |
Transportation | |||
SALES AND OPERATING REVENUES: | |||
Revenues | 113,860 | 69,607 | 21,129 |
EXPENSES: | |||
Operating expenses (excluding depreciation, depletion and amortization) | 113,860 | 69,607 | 21,129 |
Other revenues | |||
SALES AND OPERATING REVENUES: | |||
Revenues | $ 52,020 | $ 38,458 | $ 31,816 |
CONSOLIDATED STATEMENTS OF OP_2
CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
CONSOLIDATED STATEMENTS OF INCOME | |||
Interest expense, interest capitalized | $ 922 | $ 396 | $ 1,325 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
NET INCOME (LOSS) | $ 579,148 | $ 178,755 | $ (129,051) |
OTHER COMPREHENSIVE INCOME (LOSS): | |||
Total recognized in accumulated other comprehensive loss | 23,175 | 23,445 | (9,681) |
OTHER COMPREHENSIVE INCOME (LOSS) | 23,175 | 23,445 | (9,681) |
COMPREHENSIVE INCOME (LOSS) | 602,323 | 202,200 | (138,732) |
Less: Comprehensive income attributable to noncontrolling interest | (1,958) | (598) | (169) |
COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO ARLP | 600,365 | 201,602 | (138,901) |
Defined benefit pension plan | |||
OTHER COMPREHENSIVE INCOME (LOSS): | |||
Amortization of prior service cost (1) | 186 | 186 | 186 |
Net actuarial gain | 10,148 | 14,921 | (5,522) |
Amortization of net actuarial loss (gain) (1) | 1,963 | 4,327 | 4,128 |
Total recognized in accumulated other comprehensive loss | 12,297 | 19,434 | (1,208) |
Pneumoconiosis benefits | |||
OTHER COMPREHENSIVE INCOME (LOSS): | |||
Net actuarial gain | 9,840 | (161) | (7,787) |
Amortization of net actuarial loss (gain) (1) | 1,038 | 4,172 | (686) |
Total recognized in accumulated other comprehensive loss | $ 10,878 | $ 4,011 | $ (8,473) |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | |||
Net income (loss) | $ 579,148 | $ 178,755 | $ (129,051) |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | |||
Depreciation, depletion and amortization | 273,759 | 261,377 | 313,387 |
Non-cash compensation expense | 11,029 | 5,709 | 3,345 |
Equity investment income | (5,634) | (2,130) | (907) |
Distributions from equity method investments | 5,634 | 2,130 | 907 |
Net gain on sale of property, plant and equipment | (3,665) | (6,592) | (5,850) |
Asset impairment | 24,977 | ||
Goodwill impairment | 0 | 0 | 132,026 |
Change in deferred income tax | 34,775 | 349 | 112 |
Other | 5,677 | 3,970 | 13,909 |
Changes in operating assets and liabilities: | |||
Trade receivables | (107,510) | (24,952) | 56,172 |
Other receivables | (7,921) | 3,109 | (3,225) |
Inventories, net | (20,138) | (4,673) | 30,522 |
Prepaid expenses and other assets | (9,179) | 211 | (2,514) |
Advance royalties | (6,787) | (7,523) | (7,690) |
Accounts payable | 14,580 | 19,481 | (24,282) |
Accrued taxes other than income taxes | 5,180 | (7,267) | 9,286 |
Accrued payroll and related benefits | 2,818 | 8,281 | (8,051) |
Pneumoconiosis benefits | 3,849 | 6,832 | 2,340 |
Workers' compensation | (3,996) | (1,292) | 1,355 |
Other | 20,193 | (10,573) | (6,123) |
Total net adjustments | 212,664 | 246,447 | 529,696 |
Net cash provided by operating activities | 791,812 | 425,202 | 400,645 |
Property, plant and equipment: | |||
Capital expenditures | (286,394) | (122,984) | (121,101) |
Change in accounts payable and accrued liabilities | 35,956 | 2,594 | (8,773) |
Proceeds from sale of property, plant and equipment | 7,468 | 7,719 | 3,762 |
Contributions to equity method investments | 24,087 | ||
Purchase of equity securities | (42,000) | ||
Payments for acquisitions of businesses | (92,618) | ||
Oil & gas reserve acquisition | (30,960) | ||
Other | (1,663) | 943 | 988 |
Net cash used in investing activities | (403,338) | (142,688) | (125,124) |
CASH FLOWS FROM FINANCING ACTIVITIES: | |||
Borrowings under securitization facility | 27,500 | 35,000 | 46,100 |
Payments under securitization facility | (27,500) | (90,900) | (64,000) |
Proceeds from equipment financings | 14,705 | ||
Payments on equipment financings | (16,071) | (17,299) | (14,805) |
Borrowings under revolving credit facilities | 15,000 | 70,000 | |
Payments under revolving credit facilities | (102,500) | (237,500) | |
Borrowings from line of credit | 5,340 | ||
Payment on line of credit | (5,340) | ||
Payments on finance lease obligations | (840) | (766) | (8,368) |
Cash settlement of grants under deferred compensation plan | (2,490) | ||
Distributions paid to Partners | (196,347) | (52,158) | (51,753) |
Other | (1,596) | (2,062) | (8,318) |
Net cash used in financing activities | (214,854) | (215,685) | (256,429) |
NET CHANGE IN CASH AND CASH EQUIVALENTS | 173,620 | 66,829 | 19,092 |
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD | 122,403 | 55,574 | 36,482 |
CASH AND CASH EQUIVALENTS AT END OF PERIOD | $ 296,023 | $ 122,403 | $ 55,574 |
CONSOLIDATED STATEMENT OF PARTN
CONSOLIDATED STATEMENT OF PARTNERS' CAPITAL - USD ($) $ in Thousands | Limited Partners' Capital | Accumulated Other Comprehensive Income (Loss) | Noncontrolling Interest | Total |
Balance at beginning of period at Dec. 31, 2019 | $ 1,331,482 | $ (77,993) | $ 11,935 | $ 1,265,424 |
Balance at beginning of period (in units) at Dec. 31, 2019 | 126,915,597 | |||
Comprehensive income (loss): | ||||
Net income (loss) | $ (129,220) | 169 | (129,051) | |
Actuarially determined long-term liability adjustments | (9,681) | (9,681) | ||
COMPREHENSIVE INCOME (LOSS) | (138,732) | |||
Settlement of deferred compensation plans | $ (3,800) | (3,800) | ||
Settlement of deferred compensation plans (in units) | 279,622 | |||
Common unit-based compensation | $ 3,345 | 3,345 | ||
Distributions on deferred common unit-based compensation | (986) | (986) | ||
Distributions from consolidated company to noncontrolling interest | (728) | (728) | ||
Distributions to Partners | (50,767) | (50,767) | ||
Other | (1,489) | (1,489) | ||
Balance at end of period at Dec. 31, 2020 | $ 1,148,565 | (87,674) | 11,376 | 1,072,267 |
Balance at end of period (in units) at Dec. 31, 2020 | 127,195,219 | |||
Comprehensive income (loss): | ||||
Net income (loss) | $ 178,157 | 598 | 178,755 | |
Actuarially determined long-term liability adjustments | 23,445 | 23,445 | ||
COMPREHENSIVE INCOME (LOSS) | 202,200 | |||
Settlement of deferred compensation plans | (1,090) | (1,090) | ||
Common unit-based compensation | 5,709 | 5,709 | ||
Distributions on deferred common unit-based compensation | (1,280) | (1,280) | ||
Distributions from consolidated company to noncontrolling interest | (859) | (859) | ||
Distributions to Partners | (50,878) | (50,878) | ||
Balance at end of period at Dec. 31, 2021 | $ 1,279,183 | (64,229) | 11,115 | $ 1,226,069 |
Balance at end of period (in units) at Dec. 31, 2021 | 127,195,219 | 127,195,219 | ||
Comprehensive income (loss): | ||||
Net income (loss) | $ 577,190 | 1,958 | $ 579,148 | |
Actuarially determined long-term liability adjustments | 23,175 | 23,175 | ||
COMPREHENSIVE INCOME (LOSS) | 602,323 | |||
Common unit-based compensation | 11,029 | 11,029 | ||
Distributions on deferred common unit-based compensation | (5,553) | (5,553) | ||
Distributions from consolidated company to noncontrolling interest | (1,596) | (1,596) | ||
Profits interest adjustment for noncontrolling interest | (15,030) | 15,030 | ||
Distributions to Partners | (190,794) | (190,794) | ||
Balance at end of period at Dec. 31, 2022 | $ 1,656,025 | $ (41,054) | $ 26,507 | $ 1,641,478 |
Balance at end of period (in units) at Dec. 31, 2022 | 127,195,219 | 127,195,219 |
ORGANIZATION AND PRESENTATION
ORGANIZATION AND PRESENTATION | 12 Months Ended |
Dec. 31, 2022 | |
ORGANIZATION AND PRESENTATION | |
ORGANIZATION AND PRESENTATION | 1. ORGANIZATION AND PRESENTATION Significant Relationships Referenced in Notes to Consolidated Financial Statements ● References to "we," "us," "our" or "ARLP Partnership" mean the business and operations of Alliance Resource Partners, L.P., the parent company, as well as its consolidated subsidiaries. ● References to "ARLP" mean Alliance Resource Partners, L.P., individually as the parent company, and not on a consolidated basis. ● References to "MGP" mean Alliance Resource Management GP, LLC, ARLP's general partner. ● References to "Mr. Craft" mean Joseph W. Craft III, the Chairman, President and Chief Executive Officer of MGP. ● References to "Intermediate Partnership" mean Alliance Resource Operating Partners, L.P., the intermediate partnership of Alliance Resource Partners, L.P. ● References to "Alliance Coal" mean Alliance Coal, LLC, an indirect wholly owned subsidiary. ● References to "Alliance Minerals" mean Alliance Minerals, LLC, an indirect wholly owned subsidiary. ● References to "Alliance Resource Properties" mean Alliance Resource Properties, LLC, an indirect wholly owned subsidiary . Organization ARLP is a Delaware limited partnership listed on the NASDAQ Global Select Market under the ticker symbol "ARLP." ARLP was formed in May 1999 and completed its initial public offering on August 19, 1999 when it acquired substantially all of the coal production and marketing assets of Alliance Resource Holdings, Inc., a Delaware corporation ("ARH"), and its subsidiaries. We are managed by our general partner, MGP, a Delaware limited liability company which holds a non-economic general partner interest in ARLP. Alliance GP, LLC ("AGP"), which is indirectly wholly owned by Mr. Craft, is the direct owner of MGP. Oil & Gas Acquisitions Boulders On October 13, 2021, we acquired approximately 1,480 oil & gas net royalty acres in the Delaware Basin from Boulders Royalty Corp. ("Boulders") for a purchase price of $31.0 million (the "Boulders Acquisition"). Belvedere On September 9, 2022, we acquired approximately 394 oil & gas net royalty acres in the Delaware Basin from Belvedere Operating, LLC ("Belvedere") for a purchase price of $11.4 million (the "Belvedere Acquisition"). Jase On October 26, 2022, we acquired approximately 3,928 oil & gas net royalty acres in the Midland and Delaware Basins from Jase Minerals, LP ("Jase") for a purchase price of $81.2 million (the "Jase Acquisition"). The Boulders, Belvedere and Jase Acquisitions enhanced our ownership position in the Permian Basin and furthered our business strategy to grow our Oil & Gas Royalties segment through accretive acquisitions. See Note 3 – Acquisitions for more information. We now hold approximately 61,400 net royalty acres in premier oil & gas resource plays including previous acquisitions and our investment in AllDale Minerals III, LP ("AllDale III"). Change in Tax Status On March 15, 2022, Alliance Minerals changed its federal income tax status from a pass-through entity to a taxable entity via a "check the box" election (the "Tax Election"), which became effective January 1, 2022. This election for Alliance Minerals is anticipated to reduce the total income tax burden on our oil & gas royalties, as Alliance Minerals will pay entity-level taxes at corporate tax rates which are anticipated to be favorable to our unitholders. For more information on the Tax Election please see Note 9 – Income Taxes. New Venture Investments Francis On April 5, 2022, we made a $20 million convertible note investment in Francis Renewable Energy, LLC ("Francis"). Francis currently is active in the installation, management and operation of metered-for-fee, public-access electric vehicle ("EV") charging stations. Francis also develops and constructs EV charging stations for third-party customers. Our investment in Francis furthers our business strategy to develop strategic relationships and invest in attractive opportunities. For more information on this investment, please see Note 13 – Variable Interest Entities. Infinitum On April 29, 2022, we purchased $32.6 million of Series D Preferred Stock in Infinitum Electric, Inc. ("Infinitum"), a Texas-based startup developer and manufacturer of electric motors featuring printed circuit board stators which have the potential to result in motors that are smaller, lighter, quieter, more efficient and capable of operating at a fraction of the carbon footprint of conventional electric motors. On November 2, 2022, we purchased an additional $9.4 million of Series D Preferred Stock in Infinitum. The preferred stock provides for non-cumulative dividends when and if declared by Infinitum's board of directors. Each share is convertible, at any time, at our option, into shares of common stock of Infinitum. Our investment in Infinitum furthers our business strategy to develop strategic relationships and invest in attractive opportunities. For more information on this investment, please see Note 14 – Investments. NGP ETP IV On June 2, 2022, we committed to purchase $25.0 million of limited partner interests in NGP ETP IV, L.P. ("NGP ETP IV"), a private equity fund sponsored by NGP Energy Capital Management, LLC ("NGP"). NGP ETP IV focuses on investments that are part of the global transition toward a lower carbon economy by partnering with top-tier management teams and investing growth equity in companies that drive or enable the growth of renewable energy, the electrification of our economy or the efficient use of energy. For more information on this investment, please see Note 13 – Variable Interest Entities. Presentation The consolidated financial statements include the accounts and operations of the ARLP Partnership and present our financial position as of December 31, 2022 and 2021, and results of our operations, comprehensive income, cash flows and changes in partners' capital for each of the three years in the period ended December 31, 2022. All of our intercompany transactions and accounts have been eliminated. Certain immaterial amounts in the prior year have been reclassified to conform to the current year presentation. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2022 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Consolidation Variable Interest Entity ("VIE") impact the VIE's economic performance and (b) the obligation to absorb losses of the VIE that could potentially be significant to the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. The primary beneficiary is required to consolidate the VIE for financial reporting purposes. To determine a VIE's primary beneficiary, we perform a qualitative assessment to determine which party, if any, has the power to direct activities of the VIE and the obligation to absorb losses and/or receive its benefits. This assessment involves identifying the activities that most significantly impact the VIE's economic performance and determine whether it, or another party, has the power to direct those activities. When evaluating whether we are the primary beneficiary of a VIE, we perform a qualitative analysis that considers the design of the VIE, the nature of our involvement and the variable interests held by other parties. See Note 13 – Variable Interest Entities for further information. Estimates ● Impairment assessments of investments, property, plant and equipment, and goodwill; ● Asset retirement obligations; ● Pension valuation variables; ● Workers' compensation and pneumoconiosis valuation variables; ● Acquisition related purchase price allocations; ● Life of mine assumptions; ● Oil & gas reserve quantities and carrying amounts; and ● Determination of oil & gas revenue accruals These significant estimates and assumptions are discussed throughout these notes to the consolidated financial statements. Fair Value Measurements We use the following fair value hierarchy, which prioritizes the inputs to valuation techniques used to measure fair value into three broad levels: ● Level 1 – Quoted prices for identical assets and liabilities in active markets that we have the ability to access at the measurement date. ● Level 2 – Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model derived valuations whose inputs are observable or whose significant value drivers are observable. ● Level 3 – Unobservable inputs for the asset or liability including situations where there is little, if any, market activity for the asset or liability. The fair value hierarchy gives the highest priority to quoted prices in active markets (Level 1) and the lowest priority to unobservable data (Level 3). In some cases, the inputs used to measure fair value might fall into different levels of the fair value hierarchy. The lowest level input that is significant to a fair value measurement determines the applicable level in the fair value hierarchy. Assessing the significance of a particular input to the fair value measurement requires judgment, considering factors specific to the asset or liability. Significant fair value measurements are used in our significant estimates and are discussed throughout these notes. Cash and Cash Equivalents Cash Management Inventories Business Combinations Goodwill Property, Plant and Equipment Mine Development Costs Leases We review each agreement to determine if an arrangement within the agreement contains a lease at the inception of an arrangement. Once an arrangement is determined to contain an operating or finance lease with a term greater than 12 months, we recognize a lease liability for the obligation to make lease payments and a right-of-use asset for the right to use the underlying asset for the lease term based on the present value of lease payments over the lease term. The lease term includes all noncancelable periods defined in the lease as well as periods covered by options to extend the lease that we are reasonably certain to exercise. As an implicit borrowing rate cannot be determined under most of our leases, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. Expenses related to leases determined to be operating leases will be recognized on a straight-line basis over the lease term including any reasonably assured renewal periods, while those determined to be finance leases will be recognized following a front-loaded expense profile in which interest and amortization are presented separately in the income statement. The determination of whether a lease is accounted for as a finance lease or an operating lease requires management to make estimates primarily about the fair value of the asset and its estimated economic useful life. Long-Lived Asset Impairment Oil & Gas Reserve Quantities and Carrying Amounts Mineral interests in oil & gas properties are grouped using a reasonable aggregation of properties with a common geological structural feature or stratigraphic condition, which we may also refer to as a depletable group. Mineral interests in proved oil & gas properties are depleted based on the units-of-production method. Proved reserves are quantities of oil & gas that can be estimated with reasonable certainty to be recoverable in the future from a given date forward, from known reservoirs, under existing economic conditions, operating methods, and government regulations. Proved developed resources are the quantities expected to be recovered through our operators' existing wells with existing equipment, infrastructure and operating methods. We evaluate impairment of our oil & gas mineral interests in proved properties whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. This evaluation is performed on a depletable group basis. We compare the undiscounted projected future cash flows expected in connection with a depletable group to its unamortized carrying amount to determine recoverability. When the carrying amount of a depletable group exceeds its estimated undiscounted future cash flows, the carrying amount is written down to its fair value, which is measured as the present value of the projected future cash flows of such properties. The factors used to determine fair value include estimates of proved reserves, future commodity prices, timing of future production, future expenditures, and a risk-adjusted discount rate. Our oil & gas mineral interests in unproved properties are also assessed for impairment periodically but at least annually when facts and circumstances indicate that the unproved property will not be transferred to proved properties. Impairment of individual unproved properties whose acquisition costs are relatively significant are assessed on a property-by-property basis, and an impairment loss is recognized if we determine that the unproved property will not be transferred to proved properties. Impairment of unproved properties whose acquisition costs are not individually significant are assessed on a group basis. Any amount of loss to be recognized and the amount of a valuation allowance needed to provide for impairment of those properties is determined by amortizing those properties in the aggregate on the basis of historical experience and other relevant information, such as the relative proportion of such properties on which proved reserves have been found in the past. Upon the sale of a complete depletable group, the book value thereof, less proceeds or salvage value, are charged to income. Upon the sale or retirement of an aggregation of interests which make up less than a complete depletable group, the proceeds are credited to accumulated depreciation, depletion and amortization, unless doing so would significantly alter the depreciation, depletion and amortization rate of the depletable group, in which case a gain or loss would be recorded. Intangibles Prepaid expenses and other assets Other long-term assets December 31, 2022 December 31, 2021 Accumulated Intangibles, Accumulated Intangibles, Original Cost Amortization Net Original Cost Amortization Net (in thousands) Customer contracts and other 10,623 (10,623) — 10,623 (9,504) 1,119 Mining permits 1,500 (472) 1,028 1,500 (418) 1,082 Total $ 12,123 $ (11,095) $ 1,028 $ 12,123 $ (9,922) $ 2,201 Amortization expense attributable to intangible assets is estimated as follows: Year Ended December 31, (in thousands) 2023 $ 54 2024 54 2025 54 2026 54 2027 54 Thereafter 758 Investments Our investments and ownership interests in entities in which we do not have a controlling financial interest are accounted for under the equity method of accounting if we have the ability to exercise significant influence over the entity. Investments accounted for under the equity method are initially recorded at cost, and the difference between the basis of our investment and the underlying equity in the net assets of the joint venture at the investment date, if any, is amortized over the lives of the related assets that gave rise to the difference. In the event our ownership requires a disproportionate sharing of income or loss, we use the hypothetical liquidation at book value ("HLBV") method to determine the appropriate allocation of income or loss. Under the HLBV method, income or loss of the investee is allocated based on hypothetical amounts that each investor would be entitled to receive if the net assets held were liquidated at book value at the end of each period, adjusted for any contributions made and distributions received during the period. We hold equity method investments in AllDale III, Francis and NGP ETP IV. See Note 13 – Variable Interest Entities and Note 14 – Investments for further discussion of our equity method investments. We review our investments for impairment whenever events or changes in circumstances indicate a loss in the value of the investment may be other-than-temporary. Advance Royalties Advance royalties December 31, 2022 2021 (in thousands) Advance royalties, affiliates (see Note 22 – Related-Party Transactions) $ 60,608 $ 55,613 Advance royalties, third-parties 14,661 12,869 Total advance royalties $ 75,269 $ 68,482 Asset Retirement Obligations Pension Benefits The discount rate is determined for our pension benefit plan based on an approach specific to our plan. The year end discount rate is determined considering a yield curve comprised of high-quality corporate bonds and the timing of the expected benefit cash flows. The expected long-term rate of return on plan assets is determined based on broad equity and bond indices, the investment goals and objectives, the target investment allocation and on the average annual total return for each asset class. Unrecognized actuarial gains and losses and unrecognized prior service costs and credits are deferred and recorded in accumulated other comprehensive loss until amortized as a component of net periodic benefit cost. Unrecognized actuarial gains and losses in excess of 10% of the greater of the benefit obligation or the market-related value of plan assets are amortized over the participants' average remaining future years of service. Workers Compensation and Pneumoconiosis (Black Lung) Benefits We provide income replacement and medical treatment for work-related traumatic injury claims as required by applicable state laws. Workers' compensation laws also compensate survivors of workers who suffer employment related deaths. Our liability for traumatic injury claims is the estimated present value of current workers' compensation benefits, based on our actuarial estimates. Our actuarial calculations are based on a blend of actuarial projection methods and numerous assumptions including claim development patterns, mortality, medical costs and interest rates. Our pneumoconiosis benefits liability is calculated using the service cost method based on the actuarial present value of the estimated pneumoconiosis obligation. Our actuarial calculations are based on numerous assumptions including claim development patterns, medical costs and mortality. Actuarial gains or losses are amortized over the remaining service period of active miners. See Note 21 – Accrued Workers' Compensation and Pneumoconiosis Benefits for more information on Workers' Compensation and Pneumoconiosis Benefits. Coal Revenue Recognition The estimated transaction price from each of our contracts is based on the total amount of consideration we expect to be entitled to under the contract. Included in the transaction price for certain coal supply contracts is the impact of variable consideration, including quality price adjustments, handling services, government imposition claims, per ton price fluctuations based on certain coal sales price indices and anticipated payments in lieu of shipments. We have constrained the expected value of variable consideration in our estimation of transaction price and only included this consideration to the extent that it is probable that a significant revenue reversal will not occur. The estimated transaction price for each contract is allocated to our performance obligations based on relative standalone selling prices determined at contract inception. Variable consideration is allocated to a specific part of the contract in many instances, such as if the variable consideration is based on production activities for coal delivered during a certain period or the outcome of a customer's ability to accept coal shipments over a certain period. Contract assets are recorded as trade receivables and reported separately in our consolidated balance sheet from other contract assets as title passes to the customer and our right to consideration becomes unconditional. Payments for coal shipments are typically due within two four weeks Oil & Gas Revenue Recognition We also periodically earn revenue from lease bonuses. We recognize lease bonus revenue when we execute a lease of our mineral interests to exploration and production companies. A lease agreement represents our contract with an operator, which is generally an exploration and production company. The contract will (a) generally transfer the rights to any oil or gas discovered, (b) grant us a right to a specified royalty interest from the operator, and (c) require the operator to commence drilling and complete operations within a specified time period. Control of the minerals transfers to the operator when the lease agreement is executed. At the time we execute the lease agreement, we expect to receive the lease bonus payment within a reasonable time, though in no case more than one year, such that we do not adjust the expected amount of consideration for the effects of any significant financing component. As a non-operator, we have limited visibility into the timing of when new wells start producing. In addition, production statements may not be received for 30 to 90 days or more after the date production is delivered. As a result, we are required to estimate the amount of production delivered to the purchaser and the price that will be received for the sale of the product. The expected sales volumes and prices from our properties are estimated and recorded within the Trade receivables Common Unit-Based Compensation We utilize the Supplemental Executive Retirement Plan ("SERP") to provide deferred compensation benefits for certain officers and key employees. All allocations made to participants under the SERP are made in the form of "phantom" ARLP units and SERP distributions will be settled in the form of ARLP common units. The SERP is administered by the Compensation Committee. Our directors participate in the MGP Amended and Restated Deferred Compensation Plan for Directors ("Directors' Deferred Compensation Plan"). Pursuant to the Directors' Deferred Compensation Plan, for amounts deferred either automatically or at the election of the director, a notional account is established and credited with notional common units of ARLP, described in the Directors' Deferred Compensation Plan as "phantom" units. Distributions from the Directors' Deferred Compensation Plan will be settled in the form of ARLP common units. For both the SERP and Directors' Deferred Compensation Plan, when quarterly cash distributions are made with respect to ARLP common units, an amount equal to such quarterly distribution is credited to each participant's notional account as additional phantom units. All grants of phantom units under the SERP and Directors' Deferred Compensation Plan vest immediately. The fair value of restricted common unit grants under the LTIP, SERP and the Directors' Deferred Compensation Plan are determined on the grant date of the award and recognized as compensation expense on a pro rata basis for LTIP and SERP awards, as appropriate, over the requisite service period. Compensation expense is fully recognized on the grant date for quarterly distributions credited to SERP accounts and Directors' Deferred Compensation Plan awards. The corresponding liability is classified as equity and included in limited partners' capital in the consolidated financial statements (See Note 18 – Common Unit-Based Compensation Plans). Income Taxes Our subsidiary Alliance Minerals within our Oil & Gas Royalties segment and certain other subsidiaries within our Other, Corporate and Elimination category are subject to federal and state income taxes. We use the liability method of accounting for income taxes, under which deferred tax assets and liabilities are recognized for the future tax consequences of (i) temporary differences between the financial statement carrying amounts and the tax basis of existing assets and liabilities and (ii) operating losses and tax credit carryforwards. Deferred income tax assets and liabilities are based on enacted rates applicable to the future period when those temporary differences are expected to be recovered or settled. The effect of a change in tax status or a change in tax rates on deferred tax assets and liabilities is recognized in the period the change in status is elected or rate change is enacted. A valuation allowance is provided for deferred tax assets when it is more likely than not the deferred tax assets will not be realized. New Accounting Standards Issued and Adopted |
ACQUISITIONS
ACQUISITIONS | 12 Months Ended |
Dec. 31, 2022 | |
ACQUISITION | |
ACQUISITION | 3. ACQUISITION S Boulders On October 13, 2021, we acquired approximately 1,480 oil & gas net royalty acres in the Delaware Basin from Boulders for a purchase price of $31.0 million, which was funded with cash on hand. This acquisition gives us increased exposure to a prolific area of the Delaware Basin and is within close proximity to reserves acquired in previous acquisitions. The acreage acquired in the Boulders Acquisition was mostly undeveloped. Because more than 90% of the mineral interests acquired in the acquisition represent undeveloped properties, including proved undeveloped, we have determined that the Boulders Acquisition should be accounted for as an asset acquisition. We have allocated the purchase price to the acquired reserves as follows: (in thousands) Mineral interests in proved properties $ 12,542 Mineral interests in unproved properties 18,418 $ 30,960 Belvedere On September 9, 2022 (the "Belvedere Acquisition Date"), we acquired approximately 394 oil & gas net royalty acres in the Delaware Basin from Belvedere for a cash purchase price of $11.4 million, which was funded with cash on hand. This acquisition gives us additional exposure to a productive area of the Delaware Basin and is within close proximity to reserves that we currently own. Because the mineral interests acquired in the Belvedere Acquisition include royalty interests in both developed properties and undeveloped properties, we have determined that the acquisition should be accounted for as a business combination and the underlying assets should be recorded at fair value as of the Belvedere Acquisition Date on our consolidated balance sheet. The following table summarizes the fair value allocation of assets acquired as of the Belvedere Acquisition Date: (in thousands) Mineral interests in proved properties $ 7,724 Mineral interests in unproved properties 3,667 $ 11,391 The fair value of the mineral interests was determined using an income approach consisting of a discounted cash flow model. The assumptions used in the discounted cash flow model included estimated production, projected cash flows, forward oil & gas prices and risk adjusted discount rates. Certain assumptions used are not observable in active markets; therefore, the fair value measurements represent Level 3 fair value measurements. The amounts of revenue and earnings from the mineral interests acquired in the Belvedere Acquisition included in our consolidated statements of operations since the Belvedere Acquisition Date are as follows: Year Ended December 31, 2022 (in thousands) Revenue $ 722 Net income 488 The following represents our supplemental pro forma consolidated revenues and net income for the years ended December 31, 2022 and 2021 as if the mineral interests acquired in the Belvedere Acquisition had been included in our consolidated results since January 1, 2021. These amounts have been calculated after applying our accounting policies. Year Ended December 31, 2022 2021 (in thousands) (unaudited) Revenues $ 2,407,368 $ 1,571,119 Net income 579,906 179,747 Jase On October 26, 2022 (the "Jase Acquisition Date"), we acquired approximately 3,928 oil & gas net royalty acres in the Midland and Delaware Basins from Jase for a cash purchase price of $81.2 million which was funded with cash on hand. This acquisition further enhanced our ownership position in the Permian Basin. Because the mineral interests acquired in the Jase Acquisition include royalty interests in both developed properties and undeveloped properties, we have determined that the acquisition should be accounted for as a business combination and the underlying assets should be recorded at fair value as of the Jase Acquisition Date on our consolidated balance sheet. The following table summarizes the fair value allocation of assets acquired as of the Jase Acquisition Date: (in thousands) Mineral interests in proved properties $ 35,918 Mineral interests in unproved properties 43,740 Receivables 1,569 Net assets acquired $ 81,227 The fair value of the mineral interests was determined using an income approach consisting of a discounted cash flow model. The assumptions used in the discounted cash flow model included estimated production, projected cash flows, forward oil & gas prices and risk adjusted discount rates. The fair value of the receivables was determined using estimated production during the period between the Jase Acquisition Date and the effective date of the agreement and observable sales prices during the period. Certain assumptions used are not observable in active markets; therefore, the fair value measurements represent Level 3 fair value measurements. The amounts of revenue and earnings from the mineral interests acquired in the Jase Acquisition included in our consolidated statements of operations since the Jase Acquisition Date are as follows: Year Ended December 31, 2022 (in thousands) Revenue $ 1,689 Net income 854 The following represents our supplemental pro forma consolidated revenues and net income for the years ended December 31, 2022 and 2021 as if the mineral interests acquired in the Jase Acquisition had been included in our consolidated results since January 1, 2021. These amounts have been calculated after applying our accounting policies. Year Ended December 31, 2022 2021 (in thousands) (unaudited) Revenues $ 2,417,278 $ 1,579,660 Net income 587,749 186,151 |
LONG-LIVED ASSET IMPAIRMENTS
LONG-LIVED ASSET IMPAIRMENTS | 12 Months Ended |
Dec. 31, 2022 | |
LONG-LIVED ASSET IMPAIRMENTS | |
LONG-LIVED ASSET IMPAIRMENTS | 4. LONG-LIVED ASSET IMPAIRMENT S During the year ended December 31, 2020, we recorded $23.5 million of non-cash asset impairment charges in our Illinois Basin Coal Operations segment due to sealing our idled Gibson North mine, resulting in its permanent closure, and a decrease in the fair value of certain mining equipment at our idled operations and greenfield coal mineral resources as a result of weakened coal market conditions including the impact of the COVID-19 pandemic. During the same period, we also recorded an asset impairment charge of $1.5 million in our Coal Royalties segment due to a decrease in the fair value of greenfield coal mineral resources held by Alliance Resource Properties near our coal mining operations in the Illinois Basin. See Note 25 – Segment Information for more information about our segments. The fair values of the impaired assets were determined using a market approach, which represents Level 3 fair value measurements under the fair value hierarchy. The fair value analysis used assumptions regarding the marketability of certain mining and coal mineral reserve and resource assets near our Illinois Basin coal mining operations. See Note 2 – Summary of Significant Accounting Policies – Long-Lived Asset Impairment for more information on our accounting policy for asset impairments. |
GOODWILL IMPAIRMENT
GOODWILL IMPAIRMENT | 12 Months Ended |
Dec. 31, 2022 | |
GOODWILL IMPAIRMENT | |
GOODWILL IMPAIRMENT | 5. GOODWILL IMPAIRMENT During the first quarter of 2020, we considered whether an interim test of our consolidated goodwill of $136.4 million was necessary. Our consolidated goodwill included $132.0 million recorded in our Illinois Basin Coal Operations segment in conjunction with our acquisition of the Hamilton mine on July 31, 2015. We assessed certain events and changes in circumstances, including (a) adverse industry and market developments, including the impact of the COVID-19 pandemic, (b) our response to these developments, including temporarily ceasing production at several mines, including our Hamilton mine and (c) our actual performance during the quarter. After consideration of these events and changes in circumstances, we performed an interim test of the goodwill associated with Hamilton comparing Hamilton's carrying amount to its fair value. We estimated the fair value of Hamilton using an income approach utilizing a discounted cash flow model. The assumptions used in the discounted cash flow model included estimated production, forward coal prices, operating expenses, capital expenditures and a weighted average cost of capital. Our forecasts of future cash flows considered market conditions at the time of the assessment and our estimate of the mine's performance in future years based on the information available to us. Key assumptions used in our valuation were not observable in active markets; therefore, the fair value measurements represent Level 3 fair value measurements. The fair value of Hamilton was determined to be below its carrying amount (including goodwill) by more than the recorded balance of goodwill associated with the mine. Accordingly, we recognized an impairment charge of $132.0 million consisting of the total carrying amount of goodwill associated with Hamilton. |
INVENTORIES
INVENTORIES | 12 Months Ended |
Dec. 31, 2022 | |
INVENTORIES | |
INVENTORIES | 6. INVENTORIES Inventories consist of the following : December 31, 2022 2021 (in thousands) Coal $ 23,553 $ 24,845 Supplies (net of reserve for obsolescence of $6,601 and $5,554, respectively) 53,773 35,457 Total inventories, net $ 77,326 $ 60,302 See Note 2 – Summary of Significant Accounting Policies for more information on our accounting policy for inventories. |
PROPERTY, PLANT AND EQUIPMENT
PROPERTY, PLANT AND EQUIPMENT | 12 Months Ended |
Dec. 31, 2022 | |
PROPERTY, PLANT AND EQUIPMENT | |
PROPERTY, PLANT AND EQUIPMENT | 7. PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment consist of the following: December 31, 2022 2021 (in thousands) Mining equipment and processing facilities $ 1,927,603 $ 1,896,470 Land and coal mineral rights 499,950 458,440 Oil & gas mineral interests 740,635 647,864 Buildings, office equipment, improvements and other miscellaneous equipment 300,436 282,902 Construction, mine development and other projects in progress 99,042 44,217 Mine development costs 289,724 278,454 Property, plant and equipment, at cost 3,857,390 3,608,347 Less accumulated depreciation, depletion and amortization (2,040,468) (1,909,669) Total property, plant and equipment, net $ 1,816,922 $ 1,698,678 Depreciation, depletion and amortization expense related to property, plant and equipment was $270.9 million, $256.9 million and $297.0 million for the years ended December 31, 2022, 2021 and 2020, respectively. At December 31, 2022 and 2021, land and coal mineral rights above include $29.9 million and $37.4 million, respectively, of carrying value associated with coal mineral reserves and resources attributable to properties where we or a third party to which we lease coal mineral reserves and resources are not currently engaged in mining operations or leasing to third parties, and therefore, the coal mineral reserves are not currently being depleted. We believe that the carrying value of these coal mineral reserves will be recovered. At December 31, 2022 and 2021, our oil & gas mineral interests noted in the table above includes the carrying value of our unproved oil & gas mineral interests totaling $383.6 million and $355.1 million, respectively. As discussed in Note 2 – Summary of Significant Accounting Policies, we generally do not record depletion expense for our unproved oil & gas mineral interests; however, we do review for impairment as needed throughout the year. During 2022, we incurred $11.3 million in mine development costs, primarily related to Hamilton and River View Coal, LLC ("River View") mine. During 2021, we did not incur material mine development costs. All past capitalized mine development costs are associated with other mines that shifted to the production phase in past years and we are amortizing these costs accordingly. We believe that the carrying value of the past development costs will be recovered. See Note 2 – Summary of Significant Accounting Policies for more information on our accounting policy for property, plant and equipment. |
LONG-TERM DEBT
LONG-TERM DEBT | 12 Months Ended |
Dec. 31, 2022 | |
LONG-TERM DEBT | |
LONG-TERM DEBT | 8. LONG-TERM DEBT Long-term debt consists of the following: Unamortized Discount and Principal Debt Issuance Costs December 31, December 31, 2022 2021 2022 2021 (in thousands) Replaced credit facility $ — $ — $ (2,702) $ (5,019) Senior notes 400,000 400,000 (2,134) (3,048) Securitization facility — — — — May 2019 equipment financing — 1,503 — — November 2019 equipment financing 21,072 31,972 — — June 2020 equipment financing 5,937 9,605 — — 427,009 443,080 (4,836) (8,067) Less current maturities (24,970) (16,071) — — Total long-term debt $ 402,039 $ 427,009 $ (4,836) $ (8,067) Credit Facility. The Credit Agreement is guaranteed by ARLP and certain of its subsidiaries, including the Intermediate Partnership and most of the direct and indirect subsidiaries of Alliance Coal (the "Subsidiary Guarantors"). The Credit Agreement also is secured by substantially all of the assets of the Subsidiary Guarantors and Alliance Coal. Borrowings under the Credit Agreement bear interest, at our option, at either (i) an adjusted term rate plus the applicable margin or (ii) the base rate plus the applicable margin. The base rate is the highest of (i) the Overnight Bank Funding Rate plus 0.50%, (ii) the Administrative Agent's prime rate, and (iii) the Daily Simple Secured Overnight Financing Rate plus 100 basis points. The applicable margin for borrowings under the Credit Agreement are determined by reference to the Consolidated Debt to Consolidated Cash Flow Ratio. Borrowings under the Replaced Credit Facility bore interest, at our option, at either (i) the base rate at the greater of three benchmarks or (ii) a Eurodollar Rate, plus margins. The Eurodollar Rate, with applicable margin, under the Replaced Credit Facility was 6.74% as of December 31, 2022. At December 31, 2022, we had $41.1 million of letters of credit outstanding with $418.4 million available for borrowing under the Replaced Credit Facility. We incurred an annual commitment fee of 0.35% on the undrawn portion of the Replaced Credit Facility. The Credit Agreement contains various restrictions affecting Alliance Coal and its subsidiaries, including, among other things, restrictions on incurrence of additional indebtedness and liens, sale of assets, investments, mergers and consolidations and transactions with affiliates. In each case, these restrictions are subject to various exceptions. In addition, the restrictions apply to the payment of cash distributions if such payment would result in a certain fixed charge coverage ratio (as determined in the Credit Agreement) or in Alliance Coal having liquidity of less than $200 million. The Credit Agreement requires us to maintain (a) debt of Alliance Coal to cash flow ratio of not more than 1.5 to 1.0, (b) a consolidated debt of Alliance Coal and the Intermediate Partnership to cash flow ratio of not more than 2.5 to 1.0 and (c) an interest coverage ratio of not less than 3.0 to 1.0, in each case, during the four most recently ended fiscal quarters. The Replaced Credit Facility was subject to similar restrictions on the Intermediate Partnership. The Replaced Credit Facility required the Intermediate Partnership to maintain (a) a debt to cash flow ratio of not more than 2.5 to 1.0, (b) a cash flow to interest expense ratio of not less than 3.0 to 1.0 and (c) a first lien debt to cash flow ratio of not more than 1.5 to 1.0, in each case, during the four most recently ended fiscal quarters. The debt to cash flow ratio, cash flow to interest expense ratio and first lien debt to cash flow ratio were 0.52 to 1.0, 21.76 to 1.0 and 0.03 to 1.0, respectively, for the trailing twelve months ended December 31, 2022. We remained in compliance with the covenants of the Replaced Credit Facility as of December 31, 2022 and anticipate remaining in compliance with the covenants of the new Credit Agreement. We utilize the Credit Agreement, as appropriate, for working capital requirements, capital expenditures and investments, scheduled debt payments and distribution payments. Net restricted assets, as defined by the Securities and Exchange Commission, refers to the amount of our consolidated subsidiaries' net assets for which the ability to transfer funds to ARLP in the form of cash dividends, loans, advances, or transfers is restricted. As a result of the restrictions contained in the Replaced Credit Facility and its associated compliance ratios, the amount of our net restricted assets at December 31, 2022 was $537.3 million. Senior Notes. Accounts Receivable Securitization May 2019 Equipment Financing. November 2019 Equipment Financing. June 2020 Equipment Financing. Other. Aggregate maturities of long-term debt are payable as follows: Year Ended December 31, (in thousands) 2023 $ 24,970 2024 2,039 2025 400,000 $ 427,009 |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2022 | |
INCOME TAXES | |
INCOME TAXES | 9. INCOME TAXES Components of income tax expense are as follows: Year Ended December 31, 2022 2021 2020 (in thousands) Current: Federal $ 17,572 $ (1) $ (78) State 1,605 70 1 19,177 69 (77) Deferred: Federal 33,038 356 (178) State 1,763 (8) 290 34,801 348 112 Income tax expense $ 53,978 $ 417 $ 35 Alliance Minerals' Tax Election resulted in the recognition of an initial deferred tax liability of $37.3 million and a corresponding increase to income tax expense for the year ended December 31, 2022. This increase in income tax expense reduced net income by $37.3 million, or approximately $0.29 per basic and diluted Reconciliations of income taxes at the U.S. federal statutory tax rate to income taxes at our effective tax rate are as follows: Year Ended December 31, 2022 2021 2020 (in thousands) Income taxes at statutory rate $ 132,956 $ 37,626 $ (27,093) Less: Income taxes at statutory rate on Partnership income not subject to income taxes (112,032) (36,577) 26,293 Increase (decrease) resulting from: State taxes, net of federal income tax 1,492 275 (192) Change in valuation allowance of deferred tax assets (317) (834) 1,151 Deferred taxes related to tax election 37,253 — — Tax effect of noncontrolling interest income not subject to income taxes (5,399) — — Other 25 (73) (124) Income tax expense $ 53,978 $ 417 $ 35 The effective income tax rate for our income tax expense for the year ended December 31, 2022 is less than the federal statutory rate, primarily due to the portion of income not subject to income taxes, partially offset by the effect of the Tax Election previously discussed. The effective income tax rates for our income tax expense for the years ended December 31, 2021 and 2020 are less than the federal statutory rate, primarily due to the portion of income not subject to income taxes. Significant components of deferred tax liabilities and deferred tax assets are as follows: December 31, 2022 2021 (in thousands) Deferred tax liabilities: Property, plant and equipment $ (38,349) $ (2,169) Total deferred tax liabilities (38,349) (2,169) Deferred tax assets: Federal loss carryovers and credits 2,139 1,328 Other 1,084 808 Total deferred tax assets 3,223 2,136 Less valuation allowance — (317) Net deferred tax assets 3,223 1,819 Overall net deferred tax liabilities $ (35,126) $ (350) Federal loss carryovers and credits are primarily due to net operating losses and research and development credits associated with the operations of other subsidiaries that are taxable for federal income tax purposes. Our 2019 through 2022 tax years remain open to examination by tax authorities. We have been notified by the Internal Revenue Service that lower-tier partnership income tax returns for the tax year ended December 31, 2020 have been selected for audit. |
LEASES
LEASES | 12 Months Ended |
Dec. 31, 2022 | |
LEASES | |
LEASES | 10. LEASES The components of lease expense were as follows: December 31, 2022 2021 2020 (in thousands) Finance lease cost: Amortization of right-of-use assets $ 597 $ 597 $ 704 Interest on lease liabilities 73 147 377 Operating lease cost 274 2,404 3,873 Short-term lease cost — 200 84 Variable lease cost 1,665 1,306 1,375 Total lease cost $ 2,609 $ 4,654 $ 6,413 Rental expense was $5.1 million, $3.3 million and $5.2 million for the years ended December 31, 2022, 2021 and 2020 respectively. Supplemental cash flow information related to leases was as follows: December 31, 2022 2021 2020 (in thousands) Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows for operating leases $ 2,880 $ 2,367 $ 3,870 Operating cash flows for finance leases $ 73 $ 147 $ 377 Financing cash flows for finance leases $ 840 $ 766 $ 8,368 Right-of-use assets obtained in exchange for lease obligations: Operating leases $ 1,315 $ 189 $ 278 Supplemental balance sheet information related to leases was as follows: December 31, 2022 2021 (in thousands) Finance leases: Property and equipment finance lease assets, gross $ 5,485 $ 5,485 Accumulated depreciation (5,061) (4,464) Property and equipment finance lease assets, net $ 424 $ 1,021 December 31, 2022 2021 Weighted average remaining lease term Operating leases 13.4 years 15.5 years Finance leases 5.0 years 3.5 years Weighted average discount rate Operating leases 6.0 % 6.0 % Finance leases 4.8 % 7.4 % Maturities of lease liabilities as of December 31, 2022 were as follows: Operating leases Finance leases (in thousands) 2023 $ 3,253 $ 140 2024 2,918 140 2025 1,734 140 2026 1,106 140 2027 1,112 140 Thereafter 11,901 — Total lease payments 22,024 700 Less imputed interest (7,100) (82) Total $ 14,924 $ 618 The current portion of our operating and finance lease obligations are included in Other current liabilities Other liabilities |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 12 Months Ended |
Dec. 31, 2022 | |
FAIR VALUE MEASUREMENTS | |
FAIR VALUE MEASUREMENTS | 11. FAIR VALUE MEASUREMENTS The following table summarizes our fair value measurements within the hierarchy not included elsewhere in these notes: December 31, 2022 December 31, 2021 Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 (in thousands) Long-term debt $ — $ 424,420 $ — $ — $ 457,758 $ — Total $ — $ 424,420 $ — $ — $ 457,758 $ — See Note 2 – Summary of Significant Accounting Policies – Fair Value Measurements for more information regarding fair value hierarchy levels. The carrying amounts for cash equivalents, accounts receivable, accounts payable, accrued and other liabilities, approximate fair value due to the short maturity of those instruments. The estimated fair value of our long-term debt, including current maturities, is based on interest rates that we believe are currently available to us in active markets for issuance of debt with similar terms and remaining maturities (See Note 8 – Long-Term Debt). The fair value of debt, which is based on these interest rates, is classified as a Level 2 measurement under the fair value hierarchy. |
PARTNERS' CAPITAL
PARTNERS' CAPITAL | 12 Months Ended |
Dec. 31, 2022 | |
PARTNERS' CAPITAL | |
PARTNERS' CAPITAL | 12. PARTNERS' CAPITAL Distributions Our available cash that is not used for unit repurchases may, at the discretion of our general partner, be distributed within 45 days after the end of each quarter to unitholders of record. Available cash is generally defined in the partnership agreement as all cash and cash equivalents on hand at the end of each quarter less reserves established by MGP in its reasonable discretion for future cash requirements. These reserves are retained to provide for the conduct of our business, the payment of debt principal and interest and to provide funds for future distributions. The following table summarizes the quarterly per unit distribution paid during each quarter of 2020 through 2022: Year Ended December 31, 2022 2021 2020 First Quarter $ 0.250 $ — $ 0.400 Second Quarter $ 0.350 $ 0.100 $ — Third Quarter $ 0.400 $ 0.100 $ — Fourth Quarter $ 0.500 $ 0.200 $ — On January 27, 2023, we declared a quarterly distribution of $0.70 per unit, totaling approximately $89.0 million, on all our common units outstanding, which was paid on February 14, 2023, to all unitholders of record on February 7, 2023. Unit Repurchase Program In May 2018, the board of directors of our general partner ("Board of Directors") approved the establishment of a unit repurchase program authorizing us to repurchase and retire up to $100 million of ARLP common units. The program has no time limit and we may repurchase units from time to time in the open market or in other privately negotiated transactions. The unit repurchase program authorization does not obligate us to repurchase any dollar amount or number of units. No unit repurchases were made during the year ended December 31, 2022. Since inception of the unit repurchase program, we have repurchased and retired 5,460,639 units at an average unit price of $17.12 for an aggregate purchase price of $93.5 million. In January 2023, the Board of Directors authorized a $93.5 million increase to the unit repurchase program, which had $6.5 million of available capacity as of December 31, 2022. As a result, we are authorized to repurchase up to a total of $100.0 million of ARLP common units. As of February 24, 2023, we have repurchased and retired 856,629 units at an average unit price of $21.15 for an aggregate purchase price of $18.1 million since we increased the amount authorized under the unit repurchase program. Other The noncontrolling interest in our consolidated balance sheets represents Bluegrass Minerals Management, LLC's ("Bluegrass Minerals") ownership interest in Cavalier Minerals JV, LLC ("Cavalier Minerals"). Our accumulated other comprehensive loss consists of unrecognized actuarial gains and losses as well as unrecognized prior service costs related to our pension and pneumoconiosis benefits. See Note 13 – Variable Interest Entities, Note 17 –Employee Benefit Plans and Note 21 – Accrued Workers' Compensation and Pneumoconiosis Benefits for further information. |
VARIABLE INTEREST ENTITIES
VARIABLE INTEREST ENTITIES | 12 Months Ended |
Dec. 31, 2022 | |
VARIABLE INTEREST ENTITIES | |
VARIABLE INTEREST ENTITIES | 13. VARIABLE INTEREST ENTITIES Cavalier Minerals On November 10, 2014, our subsidiary, Alliance Minerals, and Bluegrass Minerals entered into a limited liability company agreement (the "Cavalier Agreement") to create Cavalier Minerals, which was formed to indirectly acquire oil & gas mineral interests through its ownership in AllDale I & II. Alliance Minerals owns a 96% member interest in Cavalier Minerals, and Bluegrass Minerals owns a 4% member interest in Cavalier Minerals and a profits interest which entitles it to receive distributions equal to 25% of all distributions (including in liquidation) after all members recovered their investment. Distributions with respect to Bluegrass Minerals' profits interest are offset by all distributions received by Bluegrass Minerals from the former general partners of AllDale I & II. Bluegrass Minerals' profits interest distributions began in late 2022. We hold the managing member interest in Cavalier Minerals. Total contributions to and cumulative distributions from Cavalier Minerals are as follows: Alliance Bluegrass Minerals Minerals (in thousands) Contributions $ 143,112 $ 5,963 Distributions 146,484 6,179 We have concluded that Cavalier Minerals is a VIE which we consolidate as the primary beneficiary because we are the managing member and a substantial equity owner in Cavalier Minerals. Bluegrass Minerals' equity ownership of Cavalier Minerals is accounted for as noncontrolling ownership interest in our consolidated balance sheets. In addition, earnings attributable to Bluegrass Minerals are recognized as noncontrolling interest in our consolidated statements of operations. AllDale III In February 2017, Alliance Minerals committed to directly invest $30.0 million in AllDale III, which was created for similar investment purposes as AllDale I & II. Alliance Minerals completed funding of this commitment in 2018. Alliance Minerals' limited partner interest in AllDale III is 13.9%. The AllDale III Partnership Agreement includes a 25% profits interest for the general partner, subject to a return hurdle equal to the greater of 125% of cumulative capital contributions and a 10% internal rate of return, and following an 80/20 "catch-up" provision for the general partner. Since AllDale III is structured as a limited partnership with the limited partners 1) not having the ability to remove the general partner and 2) not participating significantly in the operational decisions, we concluded that AllDale III is a VIE. We are not the primary beneficiary of AllDale III as we do not have the power to direct the activities that most significantly impact AllDale III's economic performance. We account for our ownership interest in the income or loss of AllDale III as an equity method investment. We record equity income or loss based on AllDale III's distribution structure. See Note 14 – Investments for more information. Francis On April 5, 2022, we invested $20 million in Francis, in the form of a convertible note with a maturity date of April 1, 2023. Our convertible note represents an ownership interest in Francis upon conversion. We have determined the note more closely represents equity as opposed to debt. Therefore, we will account for the convertible note as an equity contribution even though we will not participate in Francis' earnings or losses and will not be eligible to receive distributions until the note converts. We have concluded that Francis is a VIE as the management structure is similar to a limited partnership with the non-managing members (i) not having the ability to remove the managing member and (ii) not participating significantly in the operational decisions. We are not the primary beneficiary of Francis as we do not have the power to direct the activities that most significantly impact Francis's economic performance. We account for our ownership interest in the income or loss of Francis as an equity method investment. We record equity income or loss based on Francis' distribution structure. See Note 14 – Investments for more information. NGP ETP IV On June 2, 2022, we committed to purchase $25.0 million of limited partner interests in NGP ETP IV, a private equity fund sponsored by NGP and focused on investments that are part of the global transition toward a lower carbon economy. We funded $4.1 million during the year ended December 31, 2022. Our final ownership percentage in NGP ETP IV is not yet known. We have concluded that NGP ETP IV is a VIE as it is structured as a limited partnership with limited partners (i) not having the ability to remove the general partner and (ii) not participating significantly in the operational decisions. We are not the primary beneficiary of NGP ETP IV as we do not have the power to direct the activities that most significantly impact NGP ETP IV's economic performance. We account for our ownership interest in the income or loss of NGP ETP IV as an equity method investment. See Note 14 – Investments for more information. See Note 2 – Summary of Significant Accounting Policies for more information on our accounting policy for variable interest entities. |
INVESTMENTS
INVESTMENTS | 12 Months Ended |
Dec. 31, 2022 | |
INVESTMENTS | |
INVESTMENTS | 14. INVESTMENTS AllDale III As discussed in Note 13 – Variable Interest Entities, we account for our ownership interest in the income or loss of AllDale III as an equity method investment. We record equity income or loss based on AllDale III's distribution structure. The changes in our equity method investment in AllDale III for each of the periods presented were as follows: Year Ended December 31, 2022 2021 2020 (in thousands) Beginning balance $ 26,325 $ 27,268 $ 28,529 Equity method investment income 5,634 2,130 907 Distributions received (6,675) (3,073) (1,895) Other — — (273) Ending balance $ 25,284 $ 26,325 $ 27,268 Francis As discussed in Note 13 – Variable Interest Entities, we account for our ownership interest in the income or loss of Francis as an equity method investment. The changes in our equity method investment in Francis for the year ended December 31, 2022 were as follows: Year Ended December 31, 2022 (in thousands) Beginning balance $ — Contributions 20,000 Ending balance $ 20,000 NGP ETP IV As discussed in Note 13 – Variable Interest Entities, we account for our ownership interest in the income or loss of NGP ETP IV as an equity method investment. The changes in our equity method investment in NGP ETP IV for the year ended December 31, 2022 were as follows: Year Ended December 31, 2022 (in thousands) Beginning balance $ — Contributions 4,087 Ending balance $ 4,087 Infinitum On April 29, 2022, we purchased $32.6 million of Series D Preferred Stock in Infinitum, a Texas-based startup developer and manufacturer of electric motors featuring printed circuit board stators. On November 2, 2022, we purchased an additional $9.4 million of Series D Preferred Stock in Infinitum at the same price per share as those shares of Series D Preferred Stock that we acquired on April 29, 2022. Our preferred stock provides for non-cumulative dividends when and if declared by Infinitum's board of directors. Each share is convertible, at any time, at our option, into shares of common stock of Infinitum. We account for our ownership interest in Infinitum as an equity investment without a readily determinable fair value. It is not practicable to estimate the fair value of our investment in Infinitum because of the lack of a quoted market price for our ownership interests. Therefore, we use a measurement alternative other than fair value to account for our investment. There have been no fair value adjustments in our investment in Infinitum subsequent to our purchases. During the period we have not observed any price changes that have occurred to identical or similar securities sold by Infinitum that would indicate an adjustment to the fair value of our investment is warranted. The changes in our investment in Infinitum for the year ended December 31, 2022 were as follows: Year Ended December 31, 2022 (in thousands) Beginning balance $ — Contributions 42,000 Ending balance $ 42,000 See Note 2 – Summary of Significant Accounting Policies for more information on our accounting policy for investments. |
REVENUE FROM CONTRACTS WITH CUS
REVENUE FROM CONTRACTS WITH CUSTOMERS | 12 Months Ended |
Dec. 31, 2022 | |
REVENUE FROM CONTRACTS WITH CUSTOMERS | |
REVENUE FROM CONTRACTS WITH CUSTOMERS | 15. REVENUE FROM CONTRACTS WITH CUSTOMERS The following table illustrates the disaggregation of our revenues by type, including a reconciliation to our segment presentation as presented in Note 25 – Segment Information. Coal Operations Royalties Other, Illinois Corporate and Basin Appalachia Oil & Gas Coal Elimination Consolidated (in thousands) Year Ended December 31, 2022 Coal sales $ 1,219,943 $ 882,286 $ — $ — $ — $ 2,102,229 Oil & gas royalties — — 138,402 — — 138,402 Coal royalties — — — 60,624 (60,624) — Transportation revenues 69,540 44,320 — — — 113,860 Other revenues 6,822 1,481 3,039 56 40,622 52,020 Total revenues $ 1,296,305 $ 928,087 $ 141,441 $ 60,680 $ (20,002) $ 2,406,511 Year Ended December 31, 2021 Coal sales $ 873,930 $ 512,993 $ — $ — $ — $ 1,386,923 Oil & gas royalties — — 74,988 — — 74,988 Coal royalties — — — 51,402 (51,402) — Transportation revenues 41,001 28,606 — — — 69,607 Other revenues 4,666 3,940 2,197 69 27,586 38,458 Total revenues $ 919,597 $ 545,539 $ 77,185 $ 51,471 $ (23,816) $ 1,569,976 Year Ended December 31, 2020 Coal sales $ 755,208 $ 477,064 $ — $ — $ — $ 1,232,272 Oil & gas royalties — — 42,912 — — 42,912 Coal royalties — — — 42,112 (42,112) — Transportation revenues 12,817 8,312 — — — 21,129 Other revenues 1,932 14,954 229 105 14,596 31,816 Total revenues $ 769,957 $ 500,330 $ 43,141 $ 42,217 $ (27,516) $ 1,328,129 The following table illustrates the projected revenue for all current coal supply contracts allocated to performance obligations that are unsatisfied or partially unsatisfied as of December 31, 2022 and disaggregated by segment and contract duration. 2026 and 2023 2024 2025 Thereafter Total (in thousands) Illinois Basin Coal Operations coal revenues $ 1,230,551 $ 730,825 $ 344,601 $ 243,600 $ 2,549,577 Appalachia Coal Operations coal revenues 721,143 532,647 308,925 1,600 1,564,315 Total coal revenues (1) $ 1,951,694 $ 1,263,472 $ 653,526 $ 245,200 $ 4,113,892 (1) Coal revenues generally consists of consolidated revenues excluding our Oil & Gas Royalties segment as well as intercompany revenues from our Coal Royalties segment. |
EARNINGS PER LIMITED PARTNER UN
EARNINGS PER LIMITED PARTNER UNIT | 12 Months Ended |
Dec. 31, 2022 | |
EARNINGS PER LIMITED PARTNER UNIT | |
EARNINGS PER LIMITED PARTNER UNIT | 16. EARNINGS PER LIMITED PARTNER UNIT We utilize the two-class method in calculating basic and diluted earnings per limited partner unit ("EPU"). Net income attributable to ARLP is allocated to limited partners and participating securities under deferred compensation plans, which include rights to nonforfeitable distributions or distribution equivalents. Net losses attributable to ARLP are allocated to limited partners but not to participating securities. Our participating securities are outstanding restricted unit awards under our LTIP and phantom units in notional accounts under our SERP and the Directors' Deferred Compensation Plan. The following is a reconciliation of net income (loss) attributable to ARLP used for calculating basic and diluted earnings per unit and the weighted-average units used in computing EPU. Year Ended December 31, 2022 2021 2020 (in thousands, except per unit data) Net income (loss) attributable to ARLP $ 577,190 $ 178,157 $ (129,220) Less: Distributions to participating securities (8,527) (2,334) — Undistributed earnings attributable to participating securities (10,576) (2,403) — Net income (loss) attributable to ARLP available to limited partners $ 558,087 $ 173,420 $ (129,220) Weighted-average limited partner units outstanding – basic and diluted 127,195 127,195 127,165 Earnings per limited partner unit - basic and diluted (1) $ 4.39 $ 1.36 $ (1.02) (1) Diluted EPU gives effect to all potentially dilutive common units outstanding during the period using the treasury stock method. Diluted EPU excludes all potentially dilutive units calculated under the treasury stock method if their effect is anti-dilutive. For the years ended December 31, 2022, 2021 and 2020, the combined total of LTIP, SERP and Directors' Deferred Compensation Plan units of 3,540,385 , 1,967,672 and 773,664 , respectively, were considered anti-dilutive under the treasury stock method. |
EMPLOYEE BENEFIT PLANS
EMPLOYEE BENEFIT PLANS | 12 Months Ended |
Dec. 31, 2022 | |
EMPLOYEE BENEFIT PLANS | |
EMPLOYEE BENEFIT PLANS | 17. EMPLOYEE BENEFIT PLANS Defined Contribution Plans Defined Benefit Plan The following sets forth changes in benefit obligations and plan assets for the years ended December 31, 2022 and 2021 and the funded status of the Pension Plan reconciled with the amounts reported in our consolidated financial statements: December 31, 2022 2021 (dollars in thousands) Change in benefit obligations: Benefit obligations at beginning of year $ 139,566 $ 147,934 Interest cost 3,749 3,438 Actuarial gain (32,996) (6,406) Benefits paid (5,637) (5,400) Benefit obligations at end of year 104,682 139,566 Change in plan assets: Fair value of plan assets at beginning of year 113,976 100,969 Employer contribution — 3,312 Actual return on plan assets (16,210) 15,095 Benefits paid (5,637) (5,400) Fair value of plan assets at end of year 92,129 113,976 Funded status at the end of year $ (12,553) $ (25,590) Amounts recognized in balance sheet: Non-current liability $ (12,553) $ (25,590) Amounts recognized in accumulated other comprehensive income consists of: Prior service cost $ (382) $ (568) Net actuarial loss (15,160) (27,271) $ (15,542) $ (27,839) Weighted-average assumption to determine benefit obligations as of December 31, Discount rate 5.10% 2.73% Weighted-average assumptions used to determine net periodic benefit cost for the year ended December 31, Discount rate 2.73% 2.37% Expected return on plan assets 6.00% 6.50% The actuarial gain components of the change in benefit obligations in 2022 and 2021 were primarily attributable to an increase in the discount rate compared to the prior year end. The expected long-term rate of return used to determine our pension liability is based on a 1.5% active management premium in addition to an asset allocation assumption of: Asset allocation As of December 31, 2022 assumption Equity securities 60% Fixed income securities 35% Real estate 5% 100% The actual return on plan assets was (14.6)% and 15.1% for the years ended December 31, 2022 and 2021, respectively. Year Ended December 31, 2022 2021 2020 (in thousands) Components of net periodic benefit cost: Interest cost $ 3,749 $ 3,438 $ 4,185 Expected return on plan assets (6,638) (6,580) (5,861) Amortization of prior service cost 186 186 186 Amortization of net loss 1,963 4,327 4,128 Net periodic benefit cost (1) $ (740) $ 1,371 $ 2,638 (1) Nonservice components of net periodic benefit cost are included in the Other income (expense) line item within our consolidated statements of operations. Year Ended December 31, 2022 2021 (in thousands) Other changes in plan assets and benefit obligation recognized in accumulated other comprehensive loss: Net actuarial gain $ 10,148 $ 14,921 Reversal of amortization item: Prior service cost 186 186 Net actuarial loss 1,963 4,327 Total recognized in accumulated other comprehensive loss 12,297 19,434 Net periodic benefit cost (credit) 740 (1,371) Total recognized in net periodic benefit cost and accumulated other comprehensive loss $ 13,037 $ 18,063 Estimated future benefit payments as of December 31, 2022 are as follows: Year Ended December 31, (in thousands) 2023 $ 6,239 2024 6,416 2025 6,605 2026 6,816 2027 6,907 2028-2032 35,293 $ 68,276 As a result of certain pension plan contribution relief provided by the American Rescue Plan Act enacted in March 2021, we do not expect to make contributions to the Pension Plan during 2023. The Compensation Committee has appointed an investment manager with full investment authority with respect to Pension Plan investments subject to investment guidelines and compliance with Employee Retirement Income Security Act of 1974 or other applicable laws. The investment manager employs a series of asset allocation strategy phases to glide the portfolio risk commensurate with both plan characteristics and market conditions. The objective of the allocation policy is to reach and maintain fully funded status. The total portfolio allocation will be adjusted as the funded ratio of the Pension Plan changes and market conditions warrant. Total account performance is reviewed at least annually, using a dynamic benchmark approach to track investment performance. General asset allocation guidelines at December 31, 2022 are as follows: Percentage of Total Portfolio Minimum Maximum Equity securities 35% 80% Fixed income securities 15% 65% Convertible securities 0% 10% Alternatives 0% 20% Equity securities include domestic equity securities, developed international equity securities, emerging markets equity securities and real estate investment trust. Fixed income securities include domestic and international investment grade fixed income securities, high yield securities and emerging markets fixed income securities. Futures may also be utilized within the equity securities and fixed income securities asset allocation. Alternatives may include individual securities, exchange traded notes, exchange traded commodities and underlying funds providing exposure to market neutral strategies, long/short strategies, direct real estate and commodities. The following information discloses the fair values of our Pension Plan assets by asset category: December 31, 2022 2021 (in thousands) Cash and cash equivalents (a) $ 5,422 $ 4,426 Commingled investment funds measured at net asset value (b): Equities - Global — 24,868 Equities - United States 36,259 41,140 Equities - United States futures (697) (2,055) Equities - International developed markets 14,214 16,382 Equities - International developed markets futures (1,693) (16,260) Equities - International emerging markets 782 (3,363) Equities - International emerging markets futures 3,289 7,024 Fixed income - Investment grade 13,856 27,095 Fixed income - High yield 156 177 Fixed income - Futures 8,590 (689) Alternatives 11,951 15,231 Total $ 92,129 $ 113,976 (a) Cash and cash equivalents represents a Level 1 fair value measurement. See Note 2 – Summary of Significant Accounting Policies – Fair Value Measurements for more information regarding the definitions of fair value hierarchy levels. (b) Investments measured at fair value using the net asset value per share (or its equivalent) have not been classified within the fair value hierarchy. The fair values of all commingled investment funds are determined based on the net asset values per unit of each of the funds. The net asset values per unit represent the aggregate value of the fund's assets at fair value less liabilities, divided by the number of units outstanding. See Note 2 – Summary of Significant Accounting Policies for more information on our accounting policy for pension benefits. |
COMMON UNIT-BASED COMPENSATION
COMMON UNIT-BASED COMPENSATION PLANS | 12 Months Ended |
Dec. 31, 2022 | |
COMMON UNIT-BASED COMPENSATION PLANS | |
COMMON UNIT-BASED COMPENSATION PLANS | 18. COMMON UNIT-BASED COMPENSATION PLANS Long-Term Incentive Plan A summary of non-vested LTIP grants of restricted units is as follows: Number of units Weighted average grant date fair value per unit Intrinsic value (in thousands) Non-vested grants at January 1, 2020 1,603,378 $ 20.39 $ 17,349 Granted (1) 1,430,489 5.02 Vested (2) (919,524) 21.70 Grants canceled (3) (675,302) 18.62 Forfeited (8,552) 20.16 Non-vested grants at December 31, 2020 1,430,489 5.02 6,409 Granted (4) 1,818,190 6.03 Forfeited (118,204) 5.48 Non-vested grants at December 31, 2021 3,130,475 5.59 39,569 Granted (4) 769,907 14.65 Forfeited (203,249) 6.93 Non-vested grants at December 31, 2022 3,697,133 7.40 75,126 (1) In December 2020, we modified the vesting requirements for certain restricted units that we granted in February 2020 which were determined to be improbable of vesting under the original vesting requirements (the "2020 Grants"). The new vesting requirements make it probable the modified restricted units will vest. Also in December 2020, an additional 578,114 restricted units under these modified vesting requirements were granted. The grant date fair value reflects the modification date fair value for those awards that were modified. (2) In February 2020, we issued 279,622 unrestricted common units to LTIP participants as a result of satisfying the vesting requirements for 424,486 restricted units that were granted in 2017. The remaining vested units were settled in cash to satisfy tax withholding obligations of the LTIP participants. In December 2020, we accelerated the vesting requirements for 495,038 restricted units that were granted in 2018 (the "2018 Grants") and settled these restricted units in cash. (3) In December 2020, 675,302 restricted units that were granted in 2019 (the "2019 Grants") were canceled since it was determined that the vesting requirements for these restricted units were not probable of being satisfied. (4) The restricted units granted during 2021 and 2022 have certain minimum-value guarantees per unit, regardless of whether or not the awards vest . For the years ended December 31, 2022, 2021 and 2020, our LTIP expense for grants of restricted units was $9.4 million, $5.4 million and $8.1 million, respectively. LTIP expense for grants of restricted units for the year ended December 31, 2020 includes the impact of the reversal of the 2019 Grants, the modification of the 2020 Grants and incremental compensation cost associated with the cash settlement of the 2018 Grants. The cash settlement of the 2018 Grants was the first time we have settled restricted units in cash and we currently do not expect to do so again in the future. The cash settlement of the 2018 Grants resulted in $5.4 million in incremental compensation cost. The 2019 Grants were determined to be not probable of vesting therefore $4.8 million of cumulative previously recognized expense was reversed in 2020, offset in part by related DERs for the 2019 Grants previously recorded to equity and then expensed in 2020. The 2020 Grants were determined to be improbable of vesting therefore the Compensation Committee modified the awards to change the vesting requirement, which made the grants probable of vesting, and granted additional restricted units under these modified vesting requirements as previously discussed. As a result, the grant date fair value of the modified awards was changed to reflect the modification date fair value of the awards resulting in a net reduction in LTIP expense of $1.0 million for the year ended December 31, 2020. The total obligation associated with LTIP grants of restricted units as of December 31, 2022 and 2021 was $16.0 million and $6.7 million, respectively, and is included in the partners' capital Limited partners-common unitholders compensation expense related to the non-vested LTIP restricted unit grants that are expected to vest. That expense is expected to be recognized over a weighted-average period of 0.8 years. On January 27, 2023, the Compensation Committee authorized additional grants of 462,225 restricted units, of which 447,225 units were granted. These restricted units have certain minimum-value guarantees, regardless of whether or not the awards vest. Supplemental Executive Retirement Plan and Directors' Deferred Compensation Plan A summary of SERP and Directors' Deferred Compensation Plan activity is as follows: Number of units Weighted average grant date fair value per unit Intrinsic value (in thousands) Phantom units outstanding as of January 1, 2020 631,365 $ 25.48 $ 6,831 Granted 129,265 5.25 Phantom units outstanding as of December 31, 2020 760,630 22.04 3,408 Granted 46,638 9.45 Issued (1) (138,570) 25.86 Phantom units outstanding as of December 31, 2021 668,698 20.37 8,452 Granted 73,842 19.44 Phantom units outstanding as of December 31, 2022 742,540 20.28 15,088 (1) During the year ended December 31, 2021, we purchased 102,962 ARLP common units on the open market to settle the account of a participant under the SERP. Units purchased were net of units settled in cash to satisfy tax-withholding obligations. Total SERP and Directors' Deferred Compensation Plan expense was $1.4 million, $0.4 million and $0.7 million for the years ended December 31, 2022, 2021 and 2020, respectively. As of December 31, 2022 and 2021, the total obligation associated with the SERP and Directors' Deferred Compensation Plan was $15.1 million and $13.5 million, respectively, and is included in the partners' capital Limited partners-common unitholders See Note 2 – Summary of Significant Accounting Policies for more information on our accounting policy for unit-based compensation. |
SUPPLEMENTAL CASH FLOW INFORMAT
SUPPLEMENTAL CASH FLOW INFORMATION | 12 Months Ended |
Dec. 31, 2022 | |
SUPPLEMENTAL CASH FLOW INFORMATION | |
SUPPLEMENTAL CASH FLOW INFORMATION | 19. SUPPLEMENTAL CASH FLOW INFORMATION Year Ended December 31, 2022 2021 2020 (in thousands) Cash Paid For: Interest $ 34,844 $ 36,402 $ 44,226 Income taxes $ 23,794 $ 11 $ 12 Non-Cash Activity: Accounts payable for purchase of property, plant and equipment $ 44,281 $ 8,325 $ 5,731 Right-of-use assets acquired by operating lease $ 1,315 $ 189 $ 278 Market value of common units issued under deferred compensation plans before tax withholding requirements $ — $ 1,082 $ 3,837 |
ASSET RETIREMENT OBLIGATIONS
ASSET RETIREMENT OBLIGATIONS | 12 Months Ended |
Dec. 31, 2022 | |
ASSET RETIREMENT OBLIGATIONS | |
ASSET RETIREMENT OBLIGATIONS | 20. ASSET RETIREMENT OBLIGATIONS The following table presents the activity affecting the asset retirement and mine closing liability: Year Ended December 31, 2022 2021 (in thousands) Beginning balance $ 131,099 $ 127,898 Accretion expense 3,731 3,688 Payments (2,445) (1,383) Allocation of liability associated with mine development and change in assumptions 17,428 896 Ending balance $ 149,813 $ 131,099 For the year ended December 31, 2022, the allocation of liability associated with mine development and change in assumptions increased by $17.4 million. The increase was largely attributable to higher cost assumptions as well as the expansion of refuse disposal facilities at certain mines. For the year ended December 31, 2021, the allocation of liability associated with mine development and change in assumptions was immaterial. The impact of discounting our estimated cash flows resulted in reducing the accrual for asset retirement obligations by $110.4 million and $98.3 million at December 31, 2022 and 2021, respectively. Estimated payments of asset retirement obligations as of December 31, 2022 are as follows: Year Ended December 31, (in thousands) 2023 $ 7,559 2024 4,936 2025 1,935 2026 1,569 2027 3,182 Thereafter 241,065 Aggregate undiscounted asset retirement obligations 260,246 Effect of discounting (110,433) Total asset retirement obligations 149,813 Less: current portion (7,559) Non-current asset retirement obligations $ 142,254 As of December 31, 2022 and 2021, we had approximately $174.3 million and $173.9 million, respectively, in surety bonds outstanding to secure the performance of our reclamation obligations. See Note 2 – Summary of Significant Accounting Policies for more information on our accounting policy for asset retirement obligations. |
ACCRUED WORKERS' COMPENSATION A
ACCRUED WORKERS' COMPENSATION AND PNEUMOCONIOSIS BENEFITS | 12 Months Ended |
Dec. 31, 2022 | |
WORKERS' COMPENSATION AND PNEUMOCONIOSIS | |
WORKERS' COMPENSATION AND PNEUMOCONIOSIS | 21. ACCRUED WORKERS' COMPENSATION AND PNEUMOCONIOSIS BENEFITS The following is a reconciliation of the changes in workers' compensation liability (including current and long-term liability balances): December 31, 2022 2021 Beginning balance $ 53,448 $ 54,739 Changes in accruals 7,384 5,168 Payments (12,708) (10,725) Interest accretion 1,147 926 Valuation loss 181 3,340 Ending balance $ 49,452 $ 53,448 The discount rate used to calculate the estimated present value of future obligations for workers' compensation was 4.87% and 2.41% at December 31, 2022 and 2021, respectively. The valuation loss in 2022 was primarily attributable to an increase in the discount rate used to calculate the estimated present value of the future obligations being partially offset by unfavorable changes in claims development. The 2021valuation loss was primarily attributable to unfavorable changes in claims development partially offset by an increase in the discount rate used to calculate the estimated present value of future obligations. As of December 31, 2022 and 2021, we had $99.8 million and $100.4 million, respectively, in surety bonds and letters of credit outstanding to secure workers' compensation obligations. We limit our exposure to traumatic injury claims by purchasing a high deductible insurance policy that starts paying benefits after deductibles for the particular claim year have been met. Our workers' compensation liability above is presented on a gross basis and does not include our expected receivables on our insurance policy. Our receivables for traumatic injury claims under this policy as of December 31, 2022 and 2021 are $4.1 million and $5.7 million, respectively. Our receivables are included in Other long-term assets The following is a reconciliation of the changes in pneumoconiosis benefit obligations: December 31, 2022 2021 (in thousands) Benefit obligations at beginning of year $ 111,316 $ 108,496 Service cost 3,798 4,021 Interest cost 2,991 2,545 Actuarial loss (gain) (9,840) 161 Benefits and expenses paid (3,978) (3,907) Benefit obligations at end of year $ 104,287 $ 111,316 The following is a reconciliation of the changes in the pneumoconiosis benefit obligation recognized in accumulated other comprehensive loss: Year Ended December 31, 2022 2021 2020 (in thousands) Net actuarial gain (loss) $ 9,840 $ (161) $ (7,787) Reversal of amortization item: Net actuarial loss (gain) 1,038 4,172 (686) Total recognized in accumulated other comprehensive loss $ 10,878 $ 4,011 $ (8,473) The discount rate used to calculate the estimated present value of future obligations for pneumoconiosis benefits was 5.0%, 2.73% and 2.38% at December 31, 2022, 2021 and 2020, respectively. Year Ended December 31, 2022 2021 2020 (in thousands) Amount recognized in accumulated other comprehensive loss consists of: Net actuarial loss $ 25,510 $ 36,388 $ 40,399 The actuarial gain component of the change in benefit obligations in 2022 was primarily attributable to favorable assumption changes in the discount rate and demographics in the at-risk population. These components were offset in part by a) unfavorable black lung claims experience, b) unfavorable assumption changes regarding future average medical benefits and legal expense levels, and c) unfavorable assumption changes related to Federal and State benefit levels. The actuarial loss component of the change in benefit obligations in 2021 was primarily attributable to unfavorable assumption changes regarding future medical and legal expense levels. These components were offset in part by a) an increase in the discount rate used to calculate the estimated present value of the future obligations and b) favorable black lung claims experience and other demographic changes in the at-risk population. Summarized below is information about the amounts recognized in the accompanying consolidated balance sheets for pneumoconiosis and workers' compensation benefits: December 31, 2022 2021 (in thousands) Workers' compensation claims $ 49,452 $ 53,448 Pneumoconiosis benefit claims 104,287 111,316 Total obligations 153,739 164,764 Less current portion (14,099) (12,293) Non-current obligations $ 139,640 $ 152,471 Both the pneumoconiosis benefit and workers' compensation obligations were unfunded at December 31, 2022 and 2021. The pneumoconiosis benefit and workers' compensation expense consists of the following components: Year Ended December 31, 2022 2021 2020 (in thousands) Black lung benefits: Service cost $ 3,798 $ 4,021 $ 3,526 Interest cost (1) 2,991 2,545 2,998 Net amortization (1) 1,038 4,172 (686) Total pneumoconiosis expense 7,827 10,738 5,838 Workers' compensation expense 11,675 8,339 12,305 Net periodic benefit cost $ 19,502 $ 19,077 $ 18,143 ________________________________________ (1) Interest cost and net amortization is included in the Other income (expense) line item within our consolidated statements of income ( see Note 2 – Summary of Significant Accounting Policies). See Note 2 – Summary of Significant Accounting Policies for more information on our accounting policy for workers' compensation and pneumoconiosis benefits. |
RELATED-PARTY TRANSACTIONS
RELATED-PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2022 | |
RELATED-PARTY TRANSACTIONS | |
RELATED-PARTY TRANSACTIONS | 22. RELATED-PARTY TRANSACTIONS We have continuing related-party transactions with MGP and its affiliates. The Board of Directors and its conflicts committee ("Conflicts Committee") review our related-party transactions that involve a potential conflict of interest between our general partner or its affiliates and ARLP or its subsidiaries or any other partner of ARLP to determine that such transactions are fair and reasonable to ARLP. As a result of these reviews, the Board of Directors and the Conflicts Committee approved each of the transactions described below that had such potential conflict of interest as fair and reasonable to ARLP. Line of Credit On February 19, 2021, we entered into a line of credit arrangement (the "Line of Credit") with a related party for $5.0 million. This Line of Credit was amended on November 4, 2021 to increase the total available under the Line of Credit to $5.5 million. The Line of Credit had a maturity date of February 28, 2023 and accrued interest at an annual rate of 3.5% payable quarterly. During the year ended December 31, 2021 we received proceeds and made payments Affiliate Coal Lease Agreements The following table summarizes advanced royalties outstanding and related payments and recoupments under our affiliate coal lease agreements: WKY CoalPlay Towhead Webster Henderson WKY Craft Foundations Coal Coal Coal CoalPlay Henderson Henderson Tunnel & Union Webster Henderson & Union Ridge Counties, KY County, KY County, KY Counties, KY Total Acquired Acquired Acquired Acquired Acquired 2005 December 2014 December 2014 December 2014 February 2015 (in thousands) As of January 1, 2020 $ 1,500 $ 16,603 $ — $ 12,607 $ 10,506 $ 41,216 Payments 3,000 3,597 2,568 2,522 2,132 13,819 Recoupment (3,000) (1,022) — — (56) (4,078) Unrecoupable — — (2,568) — — (2,568) As of December 31, 2020 1,500 19,178 — 15,129 12,582 48,389 Payments 3,000 3,597 2,568 2,521 2,131 13,817 Recoupment (3,000) (1,025) — — — (4,025) Unrecoupable — — (2,568) — — (2,568) As of December 31, 2021 1,500 21,750 — 17,650 14,713 55,613 Payments 3,000 3,597 — 2,522 2,131 11,250 Recoupment (3,000) (3,255) — — — (6,255) Unrecoupable — — — — — — As of December 31, 2022 $ 1,500 $ 22,092 $ — $ 20,172 $ 16,844 $ 60,608 Craft Foundations — one half Tunnel Ridge has a surface land lease with an annual payment of $0.2 million, payable in January of each year with the Craft Foundations. WKY CoalPlay — In December 2014, WKY CoalPlay's subsidiaries, Towhead Coal Reserves, LLC and Henderson Coal Reserves, LLC entered into coal lease agreements with Alliance Resource Properties. The leases have initial terms of 20 years and provide for earned royalty payments of 4.0% of the coal sales price and annual minimum royalty payments of $3.6 million and $2.5 million, respectively. All annual minimum royalty payments under each agreement are recoupable from future earned royalties payable under that agreement. In December 2014, WKY CoalPlay's subsidiary, Webster Coal Reserves, LLC entered into a coal lease agreement with Alliance Resource Properties. The lease had a term of 7 years and provided for earned royalty payments of 4.0% of the coal sales price and annual minimum royalty payments of $2.6 million. This lease expired in December 2021. Cavalier Minerals |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2022 | |
COMMITMENTS AND CONTINGENCIES. | |
COMMITMENTS AND CONTINGENCIES | 23. COMMITMENTS AND CONTINGENCIES Commitments — Contractual Commitments — General Litigation — We also have various other lawsuits, claims and regulatory proceedings incidental to our business that are pending against the ARLP Partnership. We record an accrual for a potential loss related to these matters when, in management's opinion, such loss is probable and reasonably estimable. Based on known facts and circumstances, we believe the ultimate outcome of these outstanding lawsuits, claims and regulatory proceedings will not have a material adverse effect on our financial condition, results of operations or liquidity. However, if the results of these matters are different from management's current expectations and in amounts greater than our accruals, such matters could have a material adverse effect on our business and operations. Other |
CONCENTRATION OF CREDIT RISK AN
CONCENTRATION OF CREDIT RISK AND MAJOR CUSTOMERS | 12 Months Ended |
Dec. 31, 2022 | |
CONCENTRATION OF CREDIT RISK AND MAJOR CUSTOMERS | |
CONCENTRATION OF CREDIT RISK AND MAJOR CUSTOMERS | 24. CONCENTRATION OF CREDIT RISK AND MAJOR CUSTOMERS The international coal market has been a part of our business with indirect sales to end-users in Europe, Africa, Asia, North America and South America. Our sales into the international coal market are considered exports and are made through brokered transactions. During the years ended December 31, 2022, 2021 and 2020, export tons represented approximately 12.5%, 12.5% and 3.3% of tons sold, respectively. Because title to our export shipments typically transfers to our brokerage customers at a point that does not necessarily reflect the end-usage point, we attribute export tons to the country with the end-usage point, if known. No individual country was attributed greater than 10% of total domestic and export tons sold during the years ended December 31, 2022, 2021 and 2020. We have significant long-term coal supply agreements, some of which contain prospective price adjustment provisions designed to reflect changes in market conditions, labor and other production costs and, in the infrequent circumstance when the coal is sold other than free on board the mine, changes in transportation rates. A major customer is defined as a customer from which we derive at least ten percent of our total revenues, including transportation revenues. Total revenues from major customers are as follows: Year Ended December 31, Segment 2022 2021 2020 (in thousands) Customer A Illinois Basin $ 328,406 $ 239,482 $ 197,379 Customer B Illinois Basin 260,146 — 157,271 Customer C Illinois Basin/Appalachia 228,480 — — Customer D Illinois Basin/Appalachia — — 137,785 Trade accounts receivable from major customers totaled approximately $63.6 million and $10.8 million at December 31, 2022 and 2021, respectively. Our credit loss experience has historically been insignificant. Financial conditions of our customers could result in a material change to our credit loss expense in future periods. The coal supply agreements with Customers A, B and C expire in 2026, 2029 and 2024 respectively. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 12 Months Ended |
Dec. 31, 2022 | |
SEGMENT INFORMATION | |
SEGMENT INFORMATION | 25. SEGMENT INFORMATION We operate in the United States as a diversified natural resource company that generates operating and royalty income from the production and marketing of coal to major domestic and international utilities and industrial users as well as royalty income from oil & gas mineral interests. We aggregate multiple operating segments into four reportable segments, Illinois Basin Coal Operations, Appalachia Coal Operations, Oil & Gas Royalties and Coal Royalties. We also have an "all other" category referred to as Other, Corporate and Elimination. Our two coal operations reportable segments correspond to major coal producing regions in the eastern United States with similar economic characteristics including coal quality, geology, coal marketing opportunities, mining and transportation methods and regulatory issues. The two coal operations reportable segments include seven mining complexes operating in Illinois, Indiana, Kentucky, Maryland, Pennsylvania, and West Virginia and a coal loading terminal in Indiana on the Ohio River. Our Oil & Gas Royalties reportable segment includes our oil & gas mineral interests which are located primarily in the Permian (Delaware and Midland), Anadarko (SCOOP/STACK) and Williston (Bakken) basins. The operations within our Oil & Gas Royalties reportable segment primarily include receiving royalties and lease bonuses for our oil & gas mineral interests. Our Coal Royalties reportable segment includes coal mineral reserves and resources owned or leased by Alliance Resource Properties, which are either (a) leased to our mining complexes or (b) near our coal mining operations but not yet leased. The Illinois Basin Coal Operations reportable segment includes (a) the Gibson County Coal, LLC's ("Gibson County Coal") mining complex, (b) the Warrior Coal, LLC ("Warrior") mining complex, (c) the River View mining complex and (d) the Hamilton mining complex. The segment also includes our Mt. Vernon Transfer Terminal, LLC ("Mt. Vernon") coal loading terminal in Indiana which operates on the Ohio River, Mid-America Carbonates, LLC ("MAC") and other support services, and our non-operating mining complexes. The Appalachia Coal Operations reportable segment includes (a) the Mettiki mining complex, (b) the Tunnel Ridge mining complex and (c) the MC Mining, LLC ("MC Mining") mining complex. The Oil & Gas Royalties reportable segment includes oil & gas mineral interests held by AR Midland, LP ("AR Midland") and AllDale I & II and includes Alliance Minerals' equity interests in both AllDale III (Note 14 – Investments) and Cavalier Minerals. Coal Royalties reportable segment includes coal mineral reserves and resources owned or leased by Alliance Resource Properties that are (a) leased to certain of our mining complexes in both the Illinois Basin Coal Operations and Appalachia Coal Operations reportable segments or (b) located near our operations and external mining operations. Approximately two-thirds of the coal sold by our Coal Operations' mines is leased from our Coal Royalties entities. Other, Corporate and Elimination includes marketing and administrative activities, Matrix Design Group, LLC, its subsidiaries, and Alliance Design Group, LLC (collectively referred to as the "Matrix Group"), our investments in Francis, Infinitum and NGP ETP IV (see Note 14 – Investments), Wildcat Insurance, which assists the ARLP Partnership with its insurance requirements, AROP Funding and Alliance Finance (both discussed in Note 8 – Long-Term Debt) and other miscellaneous activities. The eliminations included in Other, Corporate and Elimination primarily represent the intercompany coal royalty transactions described above between our Coal Royalties reportable segment and our coal operations' mines. Reportable segment results are presented below. Coal Operations Royalties Other, Illinois Corporate and Basin Appalachia Oil & Gas Coal Elimination Consolidated (in thousands) Year Ended December 31, 2022 Revenues - Outside $ 1,296,305 $ 928,087 $ 141,441 $ 56 $ 40,622 $ 2,406,511 Revenues - Intercompany — — — 60,624 (60,624) — Total revenues (1) 1,296,305 928,087 141,441 60,680 (20,002) 2,406,511 Segment Adjusted EBITDA Expense (2) 806,080 464,029 13,950 21,871 (23,497) 1,282,433 Segment Adjusted EBITDA (3) 420,684 426,402 131,168 38,809 3,495 1,020,558 Total assets 779,018 431,913 711,917 321,587 417,038 2,661,473 Capital expenditures (4) 158,624 76,603 — 38,276 12,891 286,394 Year Ended December 31, 2021 Revenues - Outside $ 919,597 $ 545,539 $ 77,185 $ 69 $ 27,586 $ 1,569,976 Revenues - Intercompany — — — 51,402 (51,402) — Total revenues (1) 919,597 545,539 77,185 51,471 (23,816) 1,569,976 Segment Adjusted EBITDA Expense (2) 613,303 344,332 9,943 18,269 (33,198) 952,649 Segment Adjusted EBITDA (3) 265,292 172,601 68,774 33,202 9,383 549,252 Total assets 676,091 420,144 630,627 285,943 146,601 2,159,406 Capital expenditures (4) 60,166 47,577 — 45 15,196 122,984 Year Ended December 31, 2020 Revenues - Outside $ 769,957 $ 500,330 $ 43,141 $ 105 $ 14,596 $ 1,328,129 Revenues - Intercompany — — — 42,112 (42,112) — Total revenues (1) 769,957 500,330 43,141 42,217 (27,516) 1,328,129 Segment Adjusted EBITDA Expense (2) 543,264 320,656 4,106 18,249 (25,026) 861,249 Segment Adjusted EBITDA (3) 213,876 171,362 39,773 23,968 (2,490) 446,489 Total assets 738,315 440,815 613,916 288,525 84,445 2,166,016 Capital expenditures 48,636 70,960 — 12 1,493 121,101 (1) Revenues included in the Other, Corporate and Elimination column are attributable to intercompany eliminations, which are primarily intercompany coal royalties eliminations, outside revenues at the Matrix Group and other outside miscellaneous sales and revenue activities. (2) Segment Adjusted EBITDA Expense includes operating expenses, coal purchases and other income. Transportation expenses are excluded as transportation revenues are recognized in an amount equal to transportation expenses when title passes to the customer. The following is a reconciliation of Operating expenses (excluding depreciation, depletion and amortization) Year Ended December 31, 2022 2021 2020 (in thousands) Operating expenses (excluding depreciation, depletion and amortization) $ 1,286,635 $ 943,257 $ 859,656 Outside coal purchases 151 6,372 — Other expense (income) (4,353) 3,020 1,593 Segment Adjusted EBITDA Expense $ 1,282,433 $ 952,649 $ 861,249 (3) Segment Adjusted EBITDA is defined as net income (loss) attributable to ARLP before net interest expense, income taxes, depreciation, depletion and amortization, general and administrative expense, asset and goodwill impairments and acquisition gain. Management therefore is able to focus solely on the evaluation of segment operating profitability as it relates to our revenues and operating expenses, which are primarily controlled by our segments. Net income (loss) , the most comparable GAAP financial measure, is reconciled to consolidated Segment Adjusted EBITDA: Year Ended December 31, 2022 2021 2020 (in thousands) Net income (loss) $ 579,148 $ 178,755 $ (129,051) Noncontrolling interest (1,958) (598) (169) Net income (loss) attributable to ARLP $ 577,190 $ 178,157 $ (129,220) General and administrative 80,334 70,160 59,806 Depreciation, depletion and amortization 273,759 261,377 313,387 Asset impairments — — 24,977 Goodwill impairment — — 132,026 Interest expense, net 35,297 39,141 45,478 Income tax expense 53,978 417 35 Consolidated Segment Adjusted EBITDA $ 1,020,558 $ 549,252 $ 446,489 . (4) Capital Expenditures shown exclude the Belvedere Acquisition on September 9, 2022, Jase Acquisition on October 26, 2022 and the Boulders Acquisition on October 13, 2021. (Note 3 – Acquisitions). |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2022 | |
SUBSEQUENT EVENTS | |
SUBSEQUENT EVENTS | 26. SUBSEQUENT EVENT S Acquisition Agreement On January 27, 2023, we entered into a one-year collaborative agreement with a third party, effective January 1, 2023, committing up to $35.0 million for the acquisition of oil & gas mineral interests in the Midland and Delaware basins. Under the agreement, the third party will assist us in the identification, evaluation, and acquisition of target oil & gas mineral interests. In exchange for these services, the third party will receive a participation share, partially funded by the third party, and will be paid a periodic management fee. JC Resources On February 22, 2023, we acquired approximately 2,682 oil & gas net royalty acres in the Delaware Basin from JC Resources LP ("JC Resources"), a related-party entity owned by Mr. Craft, for $72.3 million, which was funded with cash on hand. |
SCHEDULE I CONDENSED FINANCIAL
SCHEDULE I CONDENSED FINANCIAL INFORMATION OF REGISTRANT | 12 Months Ended |
Dec. 31, 2022 | |
CONDENSED FINANCIAL INFORMATION OF REGISTRANT | |
CONDENSED FINANCIAL INFORMATION OF REGISTRANT | SCHEDULE I – CONDENSED FINANCIAL INFORMATION OF REGISTRANT ALLIANCE RESOURCE PARTNERS, L.P. CONDENSED BALANCE SHEETS (PARENT) DECEMBER 31, 2022 AND 2021 (In thousands, except unit data) December 31, 2022 2021 ASSETS CURRENT ASSETS: Cash and cash equivalents $ 2,174 $ 2,173 Total current assets 2,174 2,173 OTHER ASSETS: Investments in consolidated subsidiaries 1,653,951 1,277,110 Total other assets 1,653,951 1,277,110 TOTAL ASSETS $ 1,656,125 $ 1,279,283 LIABILITIES AND PARTNERS' CAPITAL CURRENT LIABILITIES: Accrued taxes other than income taxes $ 100 $ 100 Total current liabilities 100 100 Total liabilities 100 100 PARTNERS' CAPITAL: Limited Partners - Common Unitholders 127,195,219 units outstanding 1,656,025 1,279,183 TOTAL LIABILITIES AND PARTNERS' CAPITAL $ 1,656,125 $ 1,279,283 See accompanying notes. CONDENSED STATEMENTS OF OPERATIONS (PARENT) FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020 (In thousands, except unit and per unit data) Year Ended December 31, 2022 2021 2020 Interest income $ — $ — $ 24 Equity in earnings of consolidated subsidiaries 577,190 178,157 (129,244) NET INCOME (LOSS) ATTRIBUTABLE TO ARLP $ 577,190 $ 178,157 $ (129,220) EARNINGS PER LIMITED PARTNER UNIT - BASIC AND DILUTED $ 4.39 $ 1.36 $ (1.02) WEIGHTED-AVERAGE NUMBER OF UNITS OUTSTANDING – BASIC AND DILUTED 127,195,219 127,195,219 127,164,659 See accompanying notes. CONDENSED STATEMENTS OF CASH FLOWS (PARENT) FOR THE YEARS ENDED DECEMBER 31, 2022, 2021 AND 2020 (In thousands) Year Ended December 31, 2022 2021 2020 CASH FLOWS FROM OPERATING ACTIVITIES: $ 196,348 $ 52,157 $ 51,751 CASH FLOWS FROM FINANCING ACTIVITIES: Distributions paid to Partners (196,347) (52,158) (51,753) Net cash used in financing activities (196,347) (52,158) (51,753) NET CHANGE IN CASH AND CASH EQUIVALENTS 1 (1) (2) CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 2,173 2,174 2,176 CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 2,174 $ 2,173 $ 2,174 See accompanying notes. NOTES TO FINANCIAL INFORMATION (PARENT) 1. BASIS OF PRESENTATION In these parent-company-only financial statements, our investment in consolidated subsidiaries is stated at cost plus equity in undistributed earnings of subsidiaries and reduced by distributions received from subsidiaries since the date of acquisition. These parent-company-only financial statements should be read in conjunction with our consolidated financial statements in "Item 8. Financial Statements and Supplementary Data" of this Annual Report on Form 10-K. 2. GUARANTEES As the parent of the Intermediate Partnership, ARLP was a guarantor of the Replaced Credit Facility and is a guarantor of the Senior Notes discussed in "Item 8. Financial Statements and Supplementary Data—Note 8 – Long-Term Debt" of this Annual Report on Form 10-K. In addition to these guarantees, ARLP has provided guarantees on surety indemnity agreements and financially guaranteed certain coal supply agreements. The duration of these guarantees varies. The maximum undiscounted potential future payment obligation for our guarantees of certain coal supply agreements as of December 31, 2022 is approximately $425.6 million as a result of elevated market prices. These guarantees provide for compensation to customers based on additional cost to the customer to replace any contracted tons that our subsidiaries fail to deliver. We do not expect to make any payments under these guarantees. 3. CASH DISTRIBUTIONS RECEIVED We received distributions of $196.3 million, $52.2 million and $51.8 million from our consolidated subsidiaries during the years ended December 31, 2022, 2021, and 2020, respectively. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Consolidation | Consolidation |
Variable Interest Entity ("VIE") | Variable Interest Entity ("VIE") impact the VIE's economic performance and (b) the obligation to absorb losses of the VIE that could potentially be significant to the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. The primary beneficiary is required to consolidate the VIE for financial reporting purposes. To determine a VIE's primary beneficiary, we perform a qualitative assessment to determine which party, if any, has the power to direct activities of the VIE and the obligation to absorb losses and/or receive its benefits. This assessment involves identifying the activities that most significantly impact the VIE's economic performance and determine whether it, or another party, has the power to direct those activities. When evaluating whether we are the primary beneficiary of a VIE, we perform a qualitative analysis that considers the design of the VIE, the nature of our involvement and the variable interests held by other parties. See Note 13 – Variable Interest Entities for further information. |
Estimates | Estimates ● Impairment assessments of investments, property, plant and equipment, and goodwill; ● Asset retirement obligations; ● Pension valuation variables; ● Workers' compensation and pneumoconiosis valuation variables; ● Acquisition related purchase price allocations; ● Life of mine assumptions; ● Oil & gas reserve quantities and carrying amounts; and ● Determination of oil & gas revenue accruals These significant estimates and assumptions are discussed throughout these notes to the consolidated financial statements. |
Fair Value Measurements | Fair Value Measurements We use the following fair value hierarchy, which prioritizes the inputs to valuation techniques used to measure fair value into three broad levels: ● Level 1 – Quoted prices for identical assets and liabilities in active markets that we have the ability to access at the measurement date. ● Level 2 – Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model derived valuations whose inputs are observable or whose significant value drivers are observable. ● Level 3 – Unobservable inputs for the asset or liability including situations where there is little, if any, market activity for the asset or liability. The fair value hierarchy gives the highest priority to quoted prices in active markets (Level 1) and the lowest priority to unobservable data (Level 3). In some cases, the inputs used to measure fair value might fall into different levels of the fair value hierarchy. The lowest level input that is significant to a fair value measurement determines the applicable level in the fair value hierarchy. Assessing the significance of a particular input to the fair value measurement requires judgment, considering factors specific to the asset or liability. Significant fair value measurements are used in our significant estimates and are discussed throughout these notes. |
Cash and Cash Equivalents | Cash and Cash Equivalents |
Cash Management | Cash Management |
Inventories | Inventories |
Business Combinations | Business Combinations |
Goodwill | Goodwill |
Property, Plant and Equipment | Property, Plant and Equipment |
Mine Development Costs | Mine Development Costs |
Leases | Leases We review each agreement to determine if an arrangement within the agreement contains a lease at the inception of an arrangement. Once an arrangement is determined to contain an operating or finance lease with a term greater than 12 months, we recognize a lease liability for the obligation to make lease payments and a right-of-use asset for the right to use the underlying asset for the lease term based on the present value of lease payments over the lease term. The lease term includes all noncancelable periods defined in the lease as well as periods covered by options to extend the lease that we are reasonably certain to exercise. As an implicit borrowing rate cannot be determined under most of our leases, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. Expenses related to leases determined to be operating leases will be recognized on a straight-line basis over the lease term including any reasonably assured renewal periods, while those determined to be finance leases will be recognized following a front-loaded expense profile in which interest and amortization are presented separately in the income statement. The determination of whether a lease is accounted for as a finance lease or an operating lease requires management to make estimates primarily about the fair value of the asset and its estimated economic useful life. |
Long-Lived Asset Impairment | Long-Lived Asset Impairment |
Oil & Gas Reserve Quantities and Carrying Amounts | Oil & Gas Reserve Quantities and Carrying Amounts Mineral interests in oil & gas properties are grouped using a reasonable aggregation of properties with a common geological structural feature or stratigraphic condition, which we may also refer to as a depletable group. Mineral interests in proved oil & gas properties are depleted based on the units-of-production method. Proved reserves are quantities of oil & gas that can be estimated with reasonable certainty to be recoverable in the future from a given date forward, from known reservoirs, under existing economic conditions, operating methods, and government regulations. Proved developed resources are the quantities expected to be recovered through our operators' existing wells with existing equipment, infrastructure and operating methods. We evaluate impairment of our oil & gas mineral interests in proved properties whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. This evaluation is performed on a depletable group basis. We compare the undiscounted projected future cash flows expected in connection with a depletable group to its unamortized carrying amount to determine recoverability. When the carrying amount of a depletable group exceeds its estimated undiscounted future cash flows, the carrying amount is written down to its fair value, which is measured as the present value of the projected future cash flows of such properties. The factors used to determine fair value include estimates of proved reserves, future commodity prices, timing of future production, future expenditures, and a risk-adjusted discount rate. Our oil & gas mineral interests in unproved properties are also assessed for impairment periodically but at least annually when facts and circumstances indicate that the unproved property will not be transferred to proved properties. Impairment of individual unproved properties whose acquisition costs are relatively significant are assessed on a property-by-property basis, and an impairment loss is recognized if we determine that the unproved property will not be transferred to proved properties. Impairment of unproved properties whose acquisition costs are not individually significant are assessed on a group basis. Any amount of loss to be recognized and the amount of a valuation allowance needed to provide for impairment of those properties is determined by amortizing those properties in the aggregate on the basis of historical experience and other relevant information, such as the relative proportion of such properties on which proved reserves have been found in the past. Upon the sale of a complete depletable group, the book value thereof, less proceeds or salvage value, are charged to income. Upon the sale or retirement of an aggregation of interests which make up less than a complete depletable group, the proceeds are credited to accumulated depreciation, depletion and amortization, unless doing so would significantly alter the depreciation, depletion and amortization rate of the depletable group, in which case a gain or loss would be recorded. |
Intangibles | Intangibles Prepaid expenses and other assets Other long-term assets December 31, 2022 December 31, 2021 Accumulated Intangibles, Accumulated Intangibles, Original Cost Amortization Net Original Cost Amortization Net (in thousands) Customer contracts and other 10,623 (10,623) — 10,623 (9,504) 1,119 Mining permits 1,500 (472) 1,028 1,500 (418) 1,082 Total $ 12,123 $ (11,095) $ 1,028 $ 12,123 $ (9,922) $ 2,201 Amortization expense attributable to intangible assets is estimated as follows: Year Ended December 31, (in thousands) 2023 $ 54 2024 54 2025 54 2026 54 2027 54 Thereafter 758 |
Investment | Investments Our investments and ownership interests in entities in which we do not have a controlling financial interest are accounted for under the equity method of accounting if we have the ability to exercise significant influence over the entity. Investments accounted for under the equity method are initially recorded at cost, and the difference between the basis of our investment and the underlying equity in the net assets of the joint venture at the investment date, if any, is amortized over the lives of the related assets that gave rise to the difference. In the event our ownership requires a disproportionate sharing of income or loss, we use the hypothetical liquidation at book value ("HLBV") method to determine the appropriate allocation of income or loss. Under the HLBV method, income or loss of the investee is allocated based on hypothetical amounts that each investor would be entitled to receive if the net assets held were liquidated at book value at the end of each period, adjusted for any contributions made and distributions received during the period. We hold equity method investments in AllDale III, Francis and NGP ETP IV. See Note 13 – Variable Interest Entities and Note 14 – Investments for further discussion of our equity method investments. We review our investments for impairment whenever events or changes in circumstances indicate a loss in the value of the investment may be other-than-temporary. |
Advance Royalties | Advance Royalties Advance royalties December 31, 2022 2021 (in thousands) Advance royalties, affiliates (see Note 22 – Related-Party Transactions) $ 60,608 $ 55,613 Advance royalties, third-parties 14,661 12,869 Total advance royalties $ 75,269 $ 68,482 |
Asset Retirement Obligations | Asset Retirement Obligations |
Pension Benefits | Pension Benefits The discount rate is determined for our pension benefit plan based on an approach specific to our plan. The year end discount rate is determined considering a yield curve comprised of high-quality corporate bonds and the timing of the expected benefit cash flows. The expected long-term rate of return on plan assets is determined based on broad equity and bond indices, the investment goals and objectives, the target investment allocation and on the average annual total return for each asset class. Unrecognized actuarial gains and losses and unrecognized prior service costs and credits are deferred and recorded in accumulated other comprehensive loss until amortized as a component of net periodic benefit cost. Unrecognized actuarial gains and losses in excess of 10% of the greater of the benefit obligation or the market-related value of plan assets are amortized over the participants' average remaining future years of service. |
Workers' Compensation and Pneumoconiosis (Black Lung) Benefits | Workers Compensation and Pneumoconiosis (Black Lung) Benefits We provide income replacement and medical treatment for work-related traumatic injury claims as required by applicable state laws. Workers' compensation laws also compensate survivors of workers who suffer employment related deaths. Our liability for traumatic injury claims is the estimated present value of current workers' compensation benefits, based on our actuarial estimates. Our actuarial calculations are based on a blend of actuarial projection methods and numerous assumptions including claim development patterns, mortality, medical costs and interest rates. Our pneumoconiosis benefits liability is calculated using the service cost method based on the actuarial present value of the estimated pneumoconiosis obligation. Our actuarial calculations are based on numerous assumptions including claim development patterns, medical costs and mortality. Actuarial gains or losses are amortized over the remaining service period of active miners. See Note 21 – Accrued Workers' Compensation and Pneumoconiosis Benefits for more information on Workers' Compensation and Pneumoconiosis Benefits. |
Coal Revenue Recognition | Coal Revenue Recognition The estimated transaction price from each of our contracts is based on the total amount of consideration we expect to be entitled to under the contract. Included in the transaction price for certain coal supply contracts is the impact of variable consideration, including quality price adjustments, handling services, government imposition claims, per ton price fluctuations based on certain coal sales price indices and anticipated payments in lieu of shipments. We have constrained the expected value of variable consideration in our estimation of transaction price and only included this consideration to the extent that it is probable that a significant revenue reversal will not occur. The estimated transaction price for each contract is allocated to our performance obligations based on relative standalone selling prices determined at contract inception. Variable consideration is allocated to a specific part of the contract in many instances, such as if the variable consideration is based on production activities for coal delivered during a certain period or the outcome of a customer's ability to accept coal shipments over a certain period. Contract assets are recorded as trade receivables and reported separately in our consolidated balance sheet from other contract assets as title passes to the customer and our right to consideration becomes unconditional. Payments for coal shipments are typically due within two four weeks Oil & Gas Revenue Recognition We also periodically earn revenue from lease bonuses. We recognize lease bonus revenue when we execute a lease of our mineral interests to exploration and production companies. A lease agreement represents our contract with an operator, which is generally an exploration and production company. The contract will (a) generally transfer the rights to any oil or gas discovered, (b) grant us a right to a specified royalty interest from the operator, and (c) require the operator to commence drilling and complete operations within a specified time period. Control of the minerals transfers to the operator when the lease agreement is executed. At the time we execute the lease agreement, we expect to receive the lease bonus payment within a reasonable time, though in no case more than one year, such that we do not adjust the expected amount of consideration for the effects of any significant financing component. As a non-operator, we have limited visibility into the timing of when new wells start producing. In addition, production statements may not be received for 30 to 90 days or more after the date production is delivered. As a result, we are required to estimate the amount of production delivered to the purchaser and the price that will be received for the sale of the product. The expected sales volumes and prices from our properties are estimated and recorded within the Trade receivables |
Common Unit-Based Compensation | Common Unit-Based Compensation We utilize the Supplemental Executive Retirement Plan ("SERP") to provide deferred compensation benefits for certain officers and key employees. All allocations made to participants under the SERP are made in the form of "phantom" ARLP units and SERP distributions will be settled in the form of ARLP common units. The SERP is administered by the Compensation Committee. Our directors participate in the MGP Amended and Restated Deferred Compensation Plan for Directors ("Directors' Deferred Compensation Plan"). Pursuant to the Directors' Deferred Compensation Plan, for amounts deferred either automatically or at the election of the director, a notional account is established and credited with notional common units of ARLP, described in the Directors' Deferred Compensation Plan as "phantom" units. Distributions from the Directors' Deferred Compensation Plan will be settled in the form of ARLP common units. For both the SERP and Directors' Deferred Compensation Plan, when quarterly cash distributions are made with respect to ARLP common units, an amount equal to such quarterly distribution is credited to each participant's notional account as additional phantom units. All grants of phantom units under the SERP and Directors' Deferred Compensation Plan vest immediately. The fair value of restricted common unit grants under the LTIP, SERP and the Directors' Deferred Compensation Plan are determined on the grant date of the award and recognized as compensation expense on a pro rata basis for LTIP and SERP awards, as appropriate, over the requisite service period. Compensation expense is fully recognized on the grant date for quarterly distributions credited to SERP accounts and Directors' Deferred Compensation Plan awards. The corresponding liability is classified as equity and included in limited partners' capital in the consolidated financial statements (See Note 18 – Common Unit-Based Compensation Plans). |
Income Taxes | Income Taxes Our subsidiary Alliance Minerals within our Oil & Gas Royalties segment and certain other subsidiaries within our Other, Corporate and Elimination category are subject to federal and state income taxes. We use the liability method of accounting for income taxes, under which deferred tax assets and liabilities are recognized for the future tax consequences of (i) temporary differences between the financial statement carrying amounts and the tax basis of existing assets and liabilities and (ii) operating losses and tax credit carryforwards. Deferred income tax assets and liabilities are based on enacted rates applicable to the future period when those temporary differences are expected to be recovered or settled. The effect of a change in tax status or a change in tax rates on deferred tax assets and liabilities is recognized in the period the change in status is elected or rate change is enacted. A valuation allowance is provided for deferred tax assets when it is more likely than not the deferred tax assets will not be realized. |
New Accounting Standards Issued and Adopted | New Accounting Standards Issued and Adopted |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Summary of intangible assets | December 31, 2022 December 31, 2021 Accumulated Intangibles, Accumulated Intangibles, Original Cost Amortization Net Original Cost Amortization Net (in thousands) Customer contracts and other 10,623 (10,623) — 10,623 (9,504) 1,119 Mining permits 1,500 (472) 1,028 1,500 (418) 1,082 Total $ 12,123 $ (11,095) $ 1,028 $ 12,123 $ (9,922) $ 2,201 |
Schedule of estimated amortization expense attributable to intangible assets | Year Ended December 31, (in thousands) 2023 $ 54 2024 54 2025 54 2026 54 2027 54 Thereafter 758 |
Summary of advance royalties | December 31, 2022 2021 (in thousands) Advance royalties, affiliates (see Note 22 – Related-Party Transactions) $ 60,608 $ 55,613 Advance royalties, third-parties 14,661 12,869 Total advance royalties $ 75,269 $ 68,482 |
ACQUISITIONS (Tables)
ACQUISITIONS (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Acquisition | |
Schedule of asset acquisition | (in thousands) Mineral interests in proved properties $ 12,542 Mineral interests in unproved properties 18,418 $ 30,960 |
Belvedere | |
Acquisition | |
Summary of assets acquired and liabilities assumed | (in thousands) Mineral interests in proved properties $ 7,724 Mineral interests in unproved properties 3,667 $ 11,391 |
Schedule of pro forma income statement | Year Ended December 31, 2022 (in thousands) Revenue $ 722 Net income 488 Year Ended December 31, 2022 2021 (in thousands) (unaudited) Revenues $ 2,407,368 $ 1,571,119 Net income 579,906 179,747 |
Jase | |
Acquisition | |
Summary of assets acquired and liabilities assumed | (in thousands) Mineral interests in proved properties $ 35,918 Mineral interests in unproved properties 43,740 Receivables 1,569 Net assets acquired $ 81,227 |
Schedule of pro forma income statement | Year Ended December 31, 2022 (in thousands) Revenue $ 1,689 Net income 854 Year Ended December 31, 2022 2021 (in thousands) (unaudited) Revenues $ 2,417,278 $ 1,579,660 Net income 587,749 186,151 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
INVENTORIES | |
Schedule of inventories | December 31, 2022 2021 (in thousands) Coal $ 23,553 $ 24,845 Supplies (net of reserve for obsolescence of $6,601 and $5,554, respectively) 53,773 35,457 Total inventories, net $ 77,326 $ 60,302 |
PROPERTY, PLANT AND EQUIPMENT (
PROPERTY, PLANT AND EQUIPMENT (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
PROPERTY, PLANT AND EQUIPMENT | |
Schedule of property, plant and equipment | December 31, 2022 2021 (in thousands) Mining equipment and processing facilities $ 1,927,603 $ 1,896,470 Land and coal mineral rights 499,950 458,440 Oil & gas mineral interests 740,635 647,864 Buildings, office equipment, improvements and other miscellaneous equipment 300,436 282,902 Construction, mine development and other projects in progress 99,042 44,217 Mine development costs 289,724 278,454 Property, plant and equipment, at cost 3,857,390 3,608,347 Less accumulated depreciation, depletion and amortization (2,040,468) (1,909,669) Total property, plant and equipment, net $ 1,816,922 $ 1,698,678 |
LONG-TERM DEBT (Tables)
LONG-TERM DEBT (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
LONG-TERM DEBT | |
Schedule of long-term debt | Unamortized Discount and Principal Debt Issuance Costs December 31, December 31, 2022 2021 2022 2021 (in thousands) Replaced credit facility $ — $ — $ (2,702) $ (5,019) Senior notes 400,000 400,000 (2,134) (3,048) Securitization facility — — — — May 2019 equipment financing — 1,503 — — November 2019 equipment financing 21,072 31,972 — — June 2020 equipment financing 5,937 9,605 — — 427,009 443,080 (4,836) (8,067) Less current maturities (24,970) (16,071) — — Total long-term debt $ 402,039 $ 427,009 $ (4,836) $ (8,067) |
Schedule of aggregate maturities of long-term debt | Year Ended December 31, (in thousands) 2023 $ 24,970 2024 2,039 2025 400,000 $ 427,009 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
INCOME TAXES | |
Components of income tax expense | Year Ended December 31, 2022 2021 2020 (in thousands) Current: Federal $ 17,572 $ (1) $ (78) State 1,605 70 1 19,177 69 (77) Deferred: Federal 33,038 356 (178) State 1,763 (8) 290 34,801 348 112 Income tax expense $ 53,978 $ 417 $ 35 |
Reconciliation from provision for income taxes at U.S. federal statutory rate to effective tax rate | Year Ended December 31, 2022 2021 2020 (in thousands) Income taxes at statutory rate $ 132,956 $ 37,626 $ (27,093) Less: Income taxes at statutory rate on Partnership income not subject to income taxes (112,032) (36,577) 26,293 Increase (decrease) resulting from: State taxes, net of federal income tax 1,492 275 (192) Change in valuation allowance of deferred tax assets (317) (834) 1,151 Deferred taxes related to tax election 37,253 — — Tax effect of noncontrolling interest income not subject to income taxes (5,399) — — Other 25 (73) (124) Income tax expense $ 53,978 $ 417 $ 35 |
Components of deferred tax liabilities and deferred tax assets | December 31, 2022 2021 (in thousands) Deferred tax liabilities: Property, plant and equipment $ (38,349) $ (2,169) Total deferred tax liabilities (38,349) (2,169) Deferred tax assets: Federal loss carryovers and credits 2,139 1,328 Other 1,084 808 Total deferred tax assets 3,223 2,136 Less valuation allowance — (317) Net deferred tax assets 3,223 1,819 Overall net deferred tax liabilities $ (35,126) $ (350) |
LEASES (Tables)
LEASES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
LEASES | |
Schedule of lease cost and other information | The components of lease expense were as follows: December 31, 2022 2021 2020 (in thousands) Finance lease cost: Amortization of right-of-use assets $ 597 $ 597 $ 704 Interest on lease liabilities 73 147 377 Operating lease cost 274 2,404 3,873 Short-term lease cost — 200 84 Variable lease cost 1,665 1,306 1,375 Total lease cost $ 2,609 $ 4,654 $ 6,413 Supplemental cash flow information related to leases was as follows: December 31, 2022 2021 2020 (in thousands) Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows for operating leases $ 2,880 $ 2,367 $ 3,870 Operating cash flows for finance leases $ 73 $ 147 $ 377 Financing cash flows for finance leases $ 840 $ 766 $ 8,368 Right-of-use assets obtained in exchange for lease obligations: Operating leases $ 1,315 $ 189 $ 278 Supplemental balance sheet information related to leases was as follows: December 31, 2022 2021 (in thousands) Finance leases: Property and equipment finance lease assets, gross $ 5,485 $ 5,485 Accumulated depreciation (5,061) (4,464) Property and equipment finance lease assets, net $ 424 $ 1,021 December 31, 2022 2021 Weighted average remaining lease term Operating leases 13.4 years 15.5 years Finance leases 5.0 years 3.5 years Weighted average discount rate Operating leases 6.0 % 6.0 % Finance leases 4.8 % 7.4 % |
Summary of supplemental lease information | |
Schedule of maturities of operating lease liabilities | Operating leases Finance leases (in thousands) 2023 $ 3,253 $ 140 2024 2,918 140 2025 1,734 140 2026 1,106 140 2027 1,112 140 Thereafter 11,901 — Total lease payments 22,024 700 Less imputed interest (7,100) (82) Total $ 14,924 $ 618 |
Schedule of maturities of finance lease liabilities | Operating leases Finance leases (in thousands) 2023 $ 3,253 $ 140 2024 2,918 140 2025 1,734 140 2026 1,106 140 2027 1,112 140 Thereafter 11,901 — Total lease payments 22,024 700 Less imputed interest (7,100) (82) Total $ 14,924 $ 618 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
FAIR VALUE MEASUREMENTS | |
Summary of fair value measurements within the hierarchy | December 31, 2022 December 31, 2021 Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 (in thousands) Long-term debt $ — $ 424,420 $ — $ — $ 457,758 $ — Total $ — $ 424,420 $ — $ — $ 457,758 $ — |
PARTNERS' CAPITAL (Tables)
PARTNERS' CAPITAL (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
PARTNERS' CAPITAL | |
Summary of quarterly per unit distribution paid | Year Ended December 31, 2022 2021 2020 First Quarter $ 0.250 $ — $ 0.400 Second Quarter $ 0.350 $ 0.100 $ — Third Quarter $ 0.400 $ 0.100 $ — Fourth Quarter $ 0.500 $ 0.200 $ — |
VARIABLE INTEREST ENTITIES (Tab
VARIABLE INTEREST ENTITIES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
VARIABLE INTEREST ENTITIES | |
Schedule of distributions | Alliance Bluegrass Minerals Minerals (in thousands) Contributions $ 143,112 $ 5,963 Distributions 146,484 6,179 |
INVESTMENTS (Tables)
INVESTMENTS (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
All Dale Minerals III | |
INVESTMENTS | |
Schedule of changes in equity method investments | Year Ended December 31, 2022 2021 2020 (in thousands) Beginning balance $ 26,325 $ 27,268 $ 28,529 Equity method investment income 5,634 2,130 907 Distributions received (6,675) (3,073) (1,895) Other — — (273) Ending balance $ 25,284 $ 26,325 $ 27,268 |
Francis Renewable Energy | |
INVESTMENTS | |
Schedule of changes in equity method investments | Year Ended December 31, 2022 (in thousands) Beginning balance $ — Contributions 20,000 Ending balance $ 20,000 |
Infinitum Electric | |
INVESTMENTS | |
Schedule of changes in equity securities without readily determinable fair value | Year Ended December 31, 2022 (in thousands) Beginning balance $ — Contributions 42,000 Ending balance $ 42,000 |
NGP ETP | |
INVESTMENTS | |
Schedule of changes in equity method investments | Year Ended December 31, 2022 (in thousands) Beginning balance $ — Contributions 4,087 Ending balance $ 4,087 |
REVENUE FROM CONTRACTS WITH C_2
REVENUE FROM CONTRACTS WITH CUSTOMERS (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
REVENUE FROM CONTRACTS WITH CUSTOMERS | |
Schedule of disaggregation of revenues by type | Coal Operations Royalties Other, Illinois Corporate and Basin Appalachia Oil & Gas Coal Elimination Consolidated (in thousands) Year Ended December 31, 2022 Coal sales $ 1,219,943 $ 882,286 $ — $ — $ — $ 2,102,229 Oil & gas royalties — — 138,402 — — 138,402 Coal royalties — — — 60,624 (60,624) — Transportation revenues 69,540 44,320 — — — 113,860 Other revenues 6,822 1,481 3,039 56 40,622 52,020 Total revenues $ 1,296,305 $ 928,087 $ 141,441 $ 60,680 $ (20,002) $ 2,406,511 Year Ended December 31, 2021 Coal sales $ 873,930 $ 512,993 $ — $ — $ — $ 1,386,923 Oil & gas royalties — — 74,988 — — 74,988 Coal royalties — — — 51,402 (51,402) — Transportation revenues 41,001 28,606 — — — 69,607 Other revenues 4,666 3,940 2,197 69 27,586 38,458 Total revenues $ 919,597 $ 545,539 $ 77,185 $ 51,471 $ (23,816) $ 1,569,976 Year Ended December 31, 2020 Coal sales $ 755,208 $ 477,064 $ — $ — $ — $ 1,232,272 Oil & gas royalties — — 42,912 — — 42,912 Coal royalties — — — 42,112 (42,112) — Transportation revenues 12,817 8,312 — — — 21,129 Other revenues 1,932 14,954 229 105 14,596 31,816 Total revenues $ 769,957 $ 500,330 $ 43,141 $ 42,217 $ (27,516) $ 1,328,129 |
Schedule of current coal supply contracts allocated to performance obligations that are unsatisfied or partially unsatisfied | 2026 and 2023 2024 2025 Thereafter Total (in thousands) Illinois Basin Coal Operations coal revenues $ 1,230,551 $ 730,825 $ 344,601 $ 243,600 $ 2,549,577 Appalachia Coal Operations coal revenues 721,143 532,647 308,925 1,600 1,564,315 Total coal revenues (1) $ 1,951,694 $ 1,263,472 $ 653,526 $ 245,200 $ 4,113,892 (1) Coal revenues generally consists of consolidated revenues excluding our Oil & Gas Royalties segment as well as intercompany revenues from our Coal Royalties segment. |
EARNINGS PER LIMITED PARTNER _2
EARNINGS PER LIMITED PARTNER UNIT (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
EARNINGS PER LIMITED PARTNER UNIT | |
Reconciliation of net income (loss) and EPU calculations | Year Ended December 31, 2022 2021 2020 (in thousands, except per unit data) Net income (loss) attributable to ARLP $ 577,190 $ 178,157 $ (129,220) Less: Distributions to participating securities (8,527) (2,334) — Undistributed earnings attributable to participating securities (10,576) (2,403) — Net income (loss) attributable to ARLP available to limited partners $ 558,087 $ 173,420 $ (129,220) Weighted-average limited partner units outstanding – basic and diluted 127,195 127,195 127,165 Earnings per limited partner unit - basic and diluted (1) $ 4.39 $ 1.36 $ (1.02) (1) Diluted EPU gives effect to all potentially dilutive common units outstanding during the period using the treasury stock method. Diluted EPU excludes all potentially dilutive units calculated under the treasury stock method if their effect is anti-dilutive. For the years ended December 31, 2022, 2021 and 2020, the combined total of LTIP, SERP and Directors' Deferred Compensation Plan units of 3,540,385 , 1,967,672 and 773,664 , respectively, were considered anti-dilutive under the treasury stock method. |
EMPLOYEE BENEFIT PLANS (Tables)
EMPLOYEE BENEFIT PLANS (Tables) - Defined benefit pension plan | 12 Months Ended |
Dec. 31, 2022 | |
Employee Benefit Plans | |
Summary of benefit plans for employees | December 31, 2022 2021 (dollars in thousands) Change in benefit obligations: Benefit obligations at beginning of year $ 139,566 $ 147,934 Interest cost 3,749 3,438 Actuarial gain (32,996) (6,406) Benefits paid (5,637) (5,400) Benefit obligations at end of year 104,682 139,566 Change in plan assets: Fair value of plan assets at beginning of year 113,976 100,969 Employer contribution — 3,312 Actual return on plan assets (16,210) 15,095 Benefits paid (5,637) (5,400) Fair value of plan assets at end of year 92,129 113,976 Funded status at the end of year $ (12,553) $ (25,590) Amounts recognized in balance sheet: Non-current liability $ (12,553) $ (25,590) Amounts recognized in accumulated other comprehensive income consists of: Prior service cost $ (382) $ (568) Net actuarial loss (15,160) (27,271) $ (15,542) $ (27,839) Weighted-average assumption to determine benefit obligations as of December 31, Discount rate 5.10% 2.73% Weighted-average assumptions used to determine net periodic benefit cost for the year ended December 31, Discount rate 2.73% 2.37% Expected return on plan assets 6.00% 6.50% |
Schedule of long-term rate of return assumptions | Asset allocation As of December 31, 2022 assumption Equity securities 60% Fixed income securities 35% Real estate 5% 100% |
Components of net periodic benefit cost | Year Ended December 31, 2022 2021 2020 (in thousands) Components of net periodic benefit cost: Interest cost $ 3,749 $ 3,438 $ 4,185 Expected return on plan assets (6,638) (6,580) (5,861) Amortization of prior service cost 186 186 186 Amortization of net loss 1,963 4,327 4,128 Net periodic benefit cost (1) $ (740) $ 1,371 $ 2,638 (1) Nonservice components of net periodic benefit cost are included in the Other income (expense) line item within our consolidated statements of operations. |
Schedule of other changes in plan assets and benefit obligation recognized in accumulated other comprehensive income | Year Ended December 31, 2022 2021 (in thousands) Other changes in plan assets and benefit obligation recognized in accumulated other comprehensive loss: Net actuarial gain $ 10,148 $ 14,921 Reversal of amortization item: Prior service cost 186 186 Net actuarial loss 1,963 4,327 Total recognized in accumulated other comprehensive loss 12,297 19,434 Net periodic benefit cost (credit) 740 (1,371) Total recognized in net periodic benefit cost and accumulated other comprehensive loss $ 13,037 $ 18,063 |
Schedule of estimated future benefit payments | Year Ended December 31, (in thousands) 2023 $ 6,239 2024 6,416 2025 6,605 2026 6,816 2027 6,907 2028-2032 35,293 $ 68,276 |
Schedule of asset allocation guidelines, actual asset allocations and fair value of Pension Plan assets | Percentage of Total Portfolio Minimum Maximum Equity securities 35% 80% Fixed income securities 15% 65% Convertible securities 0% 10% Alternatives 0% 20% December 31, 2022 2021 (in thousands) Cash and cash equivalents (a) $ 5,422 $ 4,426 Commingled investment funds measured at net asset value (b): Equities - Global — 24,868 Equities - United States 36,259 41,140 Equities - United States futures (697) (2,055) Equities - International developed markets 14,214 16,382 Equities - International developed markets futures (1,693) (16,260) Equities - International emerging markets 782 (3,363) Equities - International emerging markets futures 3,289 7,024 Fixed income - Investment grade 13,856 27,095 Fixed income - High yield 156 177 Fixed income - Futures 8,590 (689) Alternatives 11,951 15,231 Total $ 92,129 $ 113,976 (a) Cash and cash equivalents represents a Level 1 fair value measurement. See Note 2 – Summary of Significant Accounting Policies – Fair Value Measurements for more information regarding the definitions of fair value hierarchy levels. (b) Investments measured at fair value using the net asset value per share (or its equivalent) have not been classified within the fair value hierarchy. The fair values of all commingled investment funds are determined based on the net asset values per unit of each of the funds. The net asset values per unit represent the aggregate value of the fund's assets at fair value less liabilities, divided by the number of units outstanding. |
COMMON UNIT-BASED COMPENSATIO_2
COMMON UNIT-BASED COMPENSATION PLANS (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
ARLP LTIP | |
COMMON UNIT-BASED COMPENSATION PLANS | |
Summary of activity in share-based plans | Number of units Weighted average grant date fair value per unit Intrinsic value (in thousands) Non-vested grants at January 1, 2020 1,603,378 $ 20.39 $ 17,349 Granted (1) 1,430,489 5.02 Vested (2) (919,524) 21.70 Grants canceled (3) (675,302) 18.62 Forfeited (8,552) 20.16 Non-vested grants at December 31, 2020 1,430,489 5.02 6,409 Granted (4) 1,818,190 6.03 Forfeited (118,204) 5.48 Non-vested grants at December 31, 2021 3,130,475 5.59 39,569 Granted (4) 769,907 14.65 Forfeited (203,249) 6.93 Non-vested grants at December 31, 2022 3,697,133 7.40 75,126 (1) In December 2020, we modified the vesting requirements for certain restricted units that we granted in February 2020 which were determined to be improbable of vesting under the original vesting requirements (the "2020 Grants"). The new vesting requirements make it probable the modified restricted units will vest. Also in December 2020, an additional 578,114 restricted units under these modified vesting requirements were granted. The grant date fair value reflects the modification date fair value for those awards that were modified. (2) In February 2020, we issued 279,622 unrestricted common units to LTIP participants as a result of satisfying the vesting requirements for 424,486 restricted units that were granted in 2017. The remaining vested units were settled in cash to satisfy tax withholding obligations of the LTIP participants. In December 2020, we accelerated the vesting requirements for 495,038 restricted units that were granted in 2018 (the "2018 Grants") and settled these restricted units in cash. (3) In December 2020, 675,302 restricted units that were granted in 2019 (the "2019 Grants") were canceled since it was determined that the vesting requirements for these restricted units were not probable of being satisfied. (4) The restricted units granted during 2021 and 2022 have certain minimum-value guarantees per unit, regardless of whether or not the awards vest . |
SERP and Deferred Compensation Plans | |
COMMON UNIT-BASED COMPENSATION PLANS | |
Summary of activity in share-based plans | Number of units Weighted average grant date fair value per unit Intrinsic value (in thousands) Phantom units outstanding as of January 1, 2020 631,365 $ 25.48 $ 6,831 Granted 129,265 5.25 Phantom units outstanding as of December 31, 2020 760,630 22.04 3,408 Granted 46,638 9.45 Issued (1) (138,570) 25.86 Phantom units outstanding as of December 31, 2021 668,698 20.37 8,452 Granted 73,842 19.44 Phantom units outstanding as of December 31, 2022 742,540 20.28 15,088 (1) During the year ended December 31, 2021, we purchased 102,962 ARLP common units on the open market to settle the account of a participant under the SERP. Units purchased were net of units settled in cash to satisfy tax-withholding obligations. |
SUPPLEMENTAL CASH FLOW INFORM_2
SUPPLEMENTAL CASH FLOW INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
SUPPLEMENTAL CASH FLOW INFORMATION | |
Schedule of supplemental cash flow information | Year Ended December 31, 2022 2021 2020 (in thousands) Cash Paid For: Interest $ 34,844 $ 36,402 $ 44,226 Income taxes $ 23,794 $ 11 $ 12 Non-Cash Activity: Accounts payable for purchase of property, plant and equipment $ 44,281 $ 8,325 $ 5,731 Right-of-use assets acquired by operating lease $ 1,315 $ 189 $ 278 Market value of common units issued under deferred compensation plans before tax withholding requirements $ — $ 1,082 $ 3,837 |
ASSET RETIREMENT OBLIGATIONS (T
ASSET RETIREMENT OBLIGATIONS (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
ASSET RETIREMENT OBLIGATIONS | |
Schedule of activity affecting the asset retirement and mine closing liability | Year Ended December 31, 2022 2021 (in thousands) Beginning balance $ 131,099 $ 127,898 Accretion expense 3,731 3,688 Payments (2,445) (1,383) Allocation of liability associated with mine development and change in assumptions 17,428 896 Ending balance $ 149,813 $ 131,099 |
Schedule of estimated payments of asset retirement obligations | Year Ended December 31, (in thousands) 2023 $ 7,559 2024 4,936 2025 1,935 2026 1,569 2027 3,182 Thereafter 241,065 Aggregate undiscounted asset retirement obligations 260,246 Effect of discounting (110,433) Total asset retirement obligations 149,813 Less: current portion (7,559) Non-current asset retirement obligations $ 142,254 |
ACCRUED WORKERS' COMPENSATION_2
ACCRUED WORKERS' COMPENSATION AND PNEUMOCONIOSIS BENEFITS (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Black lung benefits: | |
Reconciliation of changes in workers' compensation liability | December 31, 2022 2021 Beginning balance $ 53,448 $ 54,739 Changes in accruals 7,384 5,168 Payments (12,708) (10,725) Interest accretion 1,147 926 Valuation loss 181 3,340 Ending balance $ 49,452 $ 53,448 |
Reconciliation of changes in pneumoconiosis benefit obligation | December 31, 2022 2021 (in thousands) Benefit obligations at beginning of year $ 111,316 $ 108,496 Service cost 3,798 4,021 Interest cost 2,991 2,545 Actuarial loss (gain) (9,840) 161 Benefits and expenses paid (3,978) (3,907) Benefit obligations at end of year $ 104,287 $ 111,316 |
Components of pneumoconiosis and workers' compensation expense | Year Ended December 31, 2022 2021 2020 (in thousands) Black lung benefits: Service cost $ 3,798 $ 4,021 $ 3,526 Interest cost (1) 2,991 2,545 2,998 Net amortization (1) 1,038 4,172 (686) Total pneumoconiosis expense 7,827 10,738 5,838 Workers' compensation expense 11,675 8,339 12,305 Net periodic benefit cost $ 19,502 $ 19,077 $ 18,143 ________________________________________ (1) Interest cost and net amortization is included in the Other income (expense) line item within our consolidated statements of income ( see Note 2 – Summary of Significant Accounting Policies). |
Pneumoconiosis benefits | |
Black lung benefits: | |
Reconciliation of changes in the pneumoconiosis benefit obligation recognized in AOCI | Year Ended December 31, 2022 2021 2020 (in thousands) Net actuarial gain (loss) $ 9,840 $ (161) $ (7,787) Reversal of amortization item: Net actuarial loss (gain) 1,038 4,172 (686) Total recognized in accumulated other comprehensive loss $ 10,878 $ 4,011 $ (8,473) |
Schedule of amount recognized in accumulated other comprehensive income | Year Ended December 31, 2022 2021 2020 (in thousands) Amount recognized in accumulated other comprehensive loss consists of: Net actuarial loss $ 25,510 $ 36,388 $ 40,399 |
Summary of information about amounts recognized in the consolidated balance sheets | December 31, 2022 2021 (in thousands) Workers' compensation claims $ 49,452 $ 53,448 Pneumoconiosis benefit claims 104,287 111,316 Total obligations 153,739 164,764 Less current portion (14,099) (12,293) Non-current obligations $ 139,640 $ 152,471 |
RELATED-PARTY TRANSACTIONS (Tab
RELATED-PARTY TRANSACTIONS (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
RELATED-PARTY TRANSACTIONS | |
Summary of advanced royalties outstanding | WKY CoalPlay Towhead Webster Henderson WKY Craft Foundations Coal Coal Coal CoalPlay Henderson Henderson Tunnel & Union Webster Henderson & Union Ridge Counties, KY County, KY County, KY Counties, KY Total Acquired Acquired Acquired Acquired Acquired 2005 December 2014 December 2014 December 2014 February 2015 (in thousands) As of January 1, 2020 $ 1,500 $ 16,603 $ — $ 12,607 $ 10,506 $ 41,216 Payments 3,000 3,597 2,568 2,522 2,132 13,819 Recoupment (3,000) (1,022) — — (56) (4,078) Unrecoupable — — (2,568) — — (2,568) As of December 31, 2020 1,500 19,178 — 15,129 12,582 48,389 Payments 3,000 3,597 2,568 2,521 2,131 13,817 Recoupment (3,000) (1,025) — — — (4,025) Unrecoupable — — (2,568) — — (2,568) As of December 31, 2021 1,500 21,750 — 17,650 14,713 55,613 Payments 3,000 3,597 — 2,522 2,131 11,250 Recoupment (3,000) (3,255) — — — (6,255) Unrecoupable — — — — — — As of December 31, 2022 $ 1,500 $ 22,092 $ — $ 20,172 $ 16,844 $ 60,608 |
CONCENTRATION OF CREDIT RISK _2
CONCENTRATION OF CREDIT RISK AND MAJOR CUSTOMERS (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
CONCENTRATION OF CREDIT RISK AND MAJOR CUSTOMERS | |
Schedule of total revenues from major customers | Year Ended December 31, Segment 2022 2021 2020 (in thousands) Customer A Illinois Basin $ 328,406 $ 239,482 $ 197,379 Customer B Illinois Basin 260,146 — 157,271 Customer C Illinois Basin/Appalachia 228,480 — — Customer D Illinois Basin/Appalachia — — 137,785 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
SEGMENT INFORMATION | |
Schedule of reportable segment results | Coal Operations Royalties Other, Illinois Corporate and Basin Appalachia Oil & Gas Coal Elimination Consolidated (in thousands) Year Ended December 31, 2022 Revenues - Outside $ 1,296,305 $ 928,087 $ 141,441 $ 56 $ 40,622 $ 2,406,511 Revenues - Intercompany — — — 60,624 (60,624) — Total revenues (1) 1,296,305 928,087 141,441 60,680 (20,002) 2,406,511 Segment Adjusted EBITDA Expense (2) 806,080 464,029 13,950 21,871 (23,497) 1,282,433 Segment Adjusted EBITDA (3) 420,684 426,402 131,168 38,809 3,495 1,020,558 Total assets 779,018 431,913 711,917 321,587 417,038 2,661,473 Capital expenditures (4) 158,624 76,603 — 38,276 12,891 286,394 Year Ended December 31, 2021 Revenues - Outside $ 919,597 $ 545,539 $ 77,185 $ 69 $ 27,586 $ 1,569,976 Revenues - Intercompany — — — 51,402 (51,402) — Total revenues (1) 919,597 545,539 77,185 51,471 (23,816) 1,569,976 Segment Adjusted EBITDA Expense (2) 613,303 344,332 9,943 18,269 (33,198) 952,649 Segment Adjusted EBITDA (3) 265,292 172,601 68,774 33,202 9,383 549,252 Total assets 676,091 420,144 630,627 285,943 146,601 2,159,406 Capital expenditures (4) 60,166 47,577 — 45 15,196 122,984 Year Ended December 31, 2020 Revenues - Outside $ 769,957 $ 500,330 $ 43,141 $ 105 $ 14,596 $ 1,328,129 Revenues - Intercompany — — — 42,112 (42,112) — Total revenues (1) 769,957 500,330 43,141 42,217 (27,516) 1,328,129 Segment Adjusted EBITDA Expense (2) 543,264 320,656 4,106 18,249 (25,026) 861,249 Segment Adjusted EBITDA (3) 213,876 171,362 39,773 23,968 (2,490) 446,489 Total assets 738,315 440,815 613,916 288,525 84,445 2,166,016 Capital expenditures 48,636 70,960 — 12 1,493 121,101 (1) Revenues included in the Other, Corporate and Elimination column are attributable to intercompany eliminations, which are primarily intercompany coal royalties eliminations, outside revenues at the Matrix Group and other outside miscellaneous sales and revenue activities. (2) Segment Adjusted EBITDA Expense includes operating expenses, coal purchases and other income. Transportation expenses are excluded as transportation revenues are recognized in an amount equal to transportation expenses when title passes to the customer. The following is a reconciliation of Operating expenses (excluding depreciation, depletion and amortization) Year Ended December 31, 2022 2021 2020 (in thousands) Operating expenses (excluding depreciation, depletion and amortization) $ 1,286,635 $ 943,257 $ 859,656 Outside coal purchases 151 6,372 — Other expense (income) (4,353) 3,020 1,593 Segment Adjusted EBITDA Expense $ 1,282,433 $ 952,649 $ 861,249 (3) Segment Adjusted EBITDA is defined as net income (loss) attributable to ARLP before net interest expense, income taxes, depreciation, depletion and amortization, general and administrative expense, asset and goodwill impairments and acquisition gain. Management therefore is able to focus solely on the evaluation of segment operating profitability as it relates to our revenues and operating expenses, which are primarily controlled by our segments. Net income (loss) , the most comparable GAAP financial measure, is reconciled to consolidated Segment Adjusted EBITDA: Year Ended December 31, 2022 2021 2020 (in thousands) Net income (loss) $ 579,148 $ 178,755 $ (129,051) Noncontrolling interest (1,958) (598) (169) Net income (loss) attributable to ARLP $ 577,190 $ 178,157 $ (129,220) General and administrative 80,334 70,160 59,806 Depreciation, depletion and amortization 273,759 261,377 313,387 Asset impairments — — 24,977 Goodwill impairment — — 132,026 Interest expense, net 35,297 39,141 45,478 Income tax expense 53,978 417 35 Consolidated Segment Adjusted EBITDA $ 1,020,558 $ 549,252 $ 446,489 . (4) Capital Expenditures shown exclude the Belvedere Acquisition on September 9, 2022, Jase Acquisition on October 26, 2022 and the Boulders Acquisition on October 13, 2021. (Note 3 – Acquisitions). |
Reconciliation of consolidated Segment Adjusted EBITDA Expense to operating expenses (excluding depreciation, depletion and amortization) | Year Ended December 31, 2022 2021 2020 (in thousands) Operating expenses (excluding depreciation, depletion and amortization) $ 1,286,635 $ 943,257 $ 859,656 Outside coal purchases 151 6,372 — Other expense (income) (4,353) 3,020 1,593 Segment Adjusted EBITDA Expense $ 1,282,433 $ 952,649 $ 861,249 (3) Segment Adjusted EBITDA is defined as net income (loss) attributable to ARLP before net interest expense, income taxes, depreciation, depletion and amortization, general and administrative expense, asset and goodwill impairments and acquisition gain. Management therefore is able to focus solely on the evaluation of segment operating profitability as it relates to our revenues and operating expenses, which are primarily controlled by our segments. Net income (loss) , the most comparable GAAP financial measure, is reconciled to consolidated Segment Adjusted EBITDA: |
Reconciliation of consolidated Segment Adjusted EBITDA to net income | Year Ended December 31, 2022 2021 2020 (in thousands) Net income (loss) $ 579,148 $ 178,755 $ (129,051) Noncontrolling interest (1,958) (598) (169) Net income (loss) attributable to ARLP $ 577,190 $ 178,157 $ (129,220) General and administrative 80,334 70,160 59,806 Depreciation, depletion and amortization 273,759 261,377 313,387 Asset impairments — — 24,977 Goodwill impairment — — 132,026 Interest expense, net 35,297 39,141 45,478 Income tax expense 53,978 417 35 Consolidated Segment Adjusted EBITDA $ 1,020,558 $ 549,252 $ 446,489 |
ORGANIZATION AND PRESENTATION (
ORGANIZATION AND PRESENTATION (Details) $ in Thousands | 12 Months Ended | |||||||
Nov. 02, 2022 USD ($) | Oct. 26, 2022 USD ($) a | Sep. 09, 2022 USD ($) a | Apr. 29, 2022 USD ($) | Oct. 13, 2021 USD ($) a | Dec. 31, 2022 USD ($) a | Dec. 31, 2021 USD ($) | Jun. 02, 2022 USD ($) | |
Ownership interests | ||||||||
Royalty acres, net | a | 61,400 | |||||||
Payments for acquisitions of businesses | $ 92,618 | |||||||
Oil & gas royalty acquisition | $ 30,960 | |||||||
Equity method investments | 49,371 | $ 26,325 | ||||||
Payment to acquire investment | $ 42,000 | |||||||
Percentage of qualifying income for tax purposes | 90% | |||||||
Boulders | ||||||||
Ownership interests | ||||||||
Royalty acres, net | a | 1,480 | |||||||
Oil & gas royalty acquisition | $ 31,000 | |||||||
Belvedere | ||||||||
Ownership interests | ||||||||
Royalty acres, net | a | 394 | |||||||
Payments for acquisitions of businesses | $ 11,400 | |||||||
Jase | ||||||||
Ownership interests | ||||||||
Royalty acres, net | a | 3,928 | |||||||
Payments for acquisitions of businesses | $ 81,200 | |||||||
Francis Renewable Energy | ||||||||
Ownership interests | ||||||||
Equity method investments | $ 20,000 | |||||||
Infinitum Electric | ||||||||
Ownership interests | ||||||||
Payment to acquire investment | $ 9,400 | $ 32,600 | 42,000 | |||||
NGP ETP | ||||||||
Ownership interests | ||||||||
Funding commitment | $ 25,000 | |||||||
Equity method investments | $ 4,087 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Goodwill | |||
Impairments of goodwill | $ 0 | $ 0 | $ 132,026 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Tangible Assets (Details) | 12 Months Ended |
Dec. 31, 2022 | |
Preparation plants, processing facilities and mineral rights | Minimum | |
Property, Plant and Equipment | |
Estimated useful life | 1 year |
Preparation plants, processing facilities and mineral rights | Maximum | |
Property, Plant and Equipment | |
Estimated useful life | 26 years |
Other plant and equipment and mining equipment | Minimum | |
Property, Plant and Equipment | |
Estimated useful life | 1 year |
Other plant and equipment and mining equipment | Maximum | |
Property, Plant and Equipment | |
Estimated useful life | 26 years |
Buildings, Office Equipment And Improvements | Minimum | |
Property, Plant and Equipment | |
Estimated useful life | 1 year |
Buildings, Office Equipment And Improvements | Maximum | |
Property, Plant and Equipment | |
Estimated useful life | 26 years |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Leases (Details) | 12 Months Ended |
Dec. 31, 2022 | |
Lease renewal term | 10 years |
Lease termination option term | 1 year |
Minimum | |
Lease term | 1 year |
Maximum | |
Lease term | 26 years |
SUMMARY OF SIGNIFICANT ACCOUN_7
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Intangible Assets | |||
Amortization expense attributable to intangible assets | $ 1,200 | $ 3,800 | $ 4,900 |
Original Cost | 12,123 | 12,123 | |
Accumulated Amortization | (11,095) | (9,922) | |
Intangibles, Net | 1,028 | 2,201 | |
Estimated amortization expense attributable to intangible assets | |||
2023 | 54 | ||
2024 | 54 | ||
2025 | 54 | ||
2026 | 54 | ||
2027 | 54 | ||
Thereafter | 758 | ||
Customer contracts, net | |||
Intangible Assets | |||
Original Cost | 10,623 | 10,623 | |
Accumulated Amortization | (10,623) | (9,504) | |
Intangibles, Net | 1,119 | ||
Permits | |||
Intangible Assets | |||
Original Cost | 1,500 | 1,500 | |
Accumulated Amortization | (472) | (418) | |
Intangibles, Net | $ 1,028 | $ 1,082 |
SUMMARY OF SIGNIFICANT ACCOUN_8
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Advance Royalties (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Advance Royalties | ||
Advance royalties, affiliates | $ 60,608 | $ 55,613 |
Advance royalties, third-parties | 14,661 | 12,869 |
Total advance royalties, net | $ 75,269 | $ 68,482 |
SUMMARY OF SIGNIFICANT ACCOUN_9
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Additional Information (Details) | 12 Months Ended |
Dec. 31, 2022 | |
Income Taxes | |
Percentage of qualifying income for tax purposes | 90% |
Minimum | |
Revenue Recognition | |
Coal shipments, payment period | 14 days |
Maximum | |
Revenue Recognition | |
Coal shipments, payment period | 28 days |
Defined benefit pension plan | |
Employee Benefit Plans | |
Threshold for amortization of unrecognized actuarial gains and losses (as a percent) | 10% |
ACQUISITIONS - Asset Acquisitio
ACQUISITIONS - Asset Acquisition (Details) $ in Thousands | 12 Months Ended | ||
Oct. 13, 2021 USD ($) a | Dec. 31, 2022 a | Dec. 31, 2021 USD ($) | |
Asset acquisition | |||
Royalty acres, net | a | 61,400 | ||
Oil & gas royalty acquisition | $ 30,960 | ||
Boulders | |||
Asset acquisition | |||
Royalty acres, net | a | 1,480 | ||
Oil & gas royalty acquisition | $ 31,000 | ||
Mineral interests in proved properties | 12,542 | ||
Mineral interests in unproved properties | 18,418 | ||
Total mineral interest | $ 30,960 |
ACQUISITIONS - Business Combina
ACQUISITIONS - Business Combination (Details) $ in Thousands | 12 Months Ended | ||
Oct. 26, 2022 USD ($) a | Sep. 09, 2022 USD ($) a | Dec. 31, 2022 USD ($) a | |
Acquisition | |||
Royalty acres, net | a | 61,400 | ||
Payments for acquisitions of businesses | $ 92,618 | ||
Belvedere | |||
Acquisition | |||
Royalty acres, net | a | 394 | ||
Payments for acquisitions of businesses | $ 11,400 | ||
Assets acquired and liabilities assumed | |||
Mineral interests in proved properties | 7,724 | ||
Mineral interests in unproved properties | 3,667 | ||
Net assets acquired | $ 11,391 | ||
Jase | |||
Acquisition | |||
Royalty acres, net | a | 3,928 | ||
Payments for acquisitions of businesses | $ 81,200 | ||
Assets acquired and liabilities assumed | |||
Mineral interests in proved properties | 35,918 | ||
Mineral interests in unproved properties | 43,740 | ||
Receivables | 1,569 | ||
Net assets acquired | $ 81,227 |
ACQUISITIONS - Pro Forma (Detai
ACQUISITIONS - Pro Forma (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Belvedere | ||
Acquisitions, additional information | ||
Revenue of acquired business | $ 722 | |
Net income of acquired business | 488 | |
Pro forma condensed consolidated income statement | ||
Total revenues, Pro forma | 2,407,368 | $ 1,571,119 |
Net income, Pro forma | 579,906 | 179,747 |
Jase | ||
Acquisitions, additional information | ||
Revenue of acquired business | 1,689 | |
Net income of acquired business | 854 | |
Pro forma condensed consolidated income statement | ||
Total revenues, Pro forma | 2,417,278 | 1,579,660 |
Net income, Pro forma | $ 587,749 | $ 186,151 |
LONG-LIVED ASSET IMPAIRMENTS (D
LONG-LIVED ASSET IMPAIRMENTS (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2020 USD ($) | |
Asset impairment charges | |
Asset impairments | $ 24,977 |
Illinois Basin | |
Asset impairment charges | |
Asset impairments | 23,500 |
Coal Royalties | |
Asset impairment charges | |
Asset impairments | $ 1,500 |
GOODWILL IMPAIRMENT (Details)
GOODWILL IMPAIRMENT (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||
Mar. 31, 2020 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
GOODWILL IMPAIRMENT | |||||
Goodwill | $ 136,400 | ||||
Impairments of goodwill | $ 0 | $ 0 | $ 132,026 | ||
Hamilton mining complex | |||||
GOODWILL IMPAIRMENT | |||||
Goodwill | $ 132,000 | ||||
Impairments of goodwill | $ 132,000 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
INVENTORIES | ||
Coal | $ 23,553 | $ 24,845 |
Supplies (net of reserve for obsolescence) | 53,773 | 35,457 |
Total inventories, net | 77,326 | 60,302 |
Reserve for obsolescence | $ 6,601 | $ 5,554 |
PROPERTY, PLANT AND EQUIPMENT -
PROPERTY, PLANT AND EQUIPMENT - Summary (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
PROPERTY, PLANT AND EQUIPMENT | |||
Property, plant and equipment, at cost | $ 3,857,390 | $ 3,608,347 | |
Less accumulated depreciation, depletion and amortization | (2,040,468) | (1,909,669) | |
Total property, plant and equipment, net | 1,816,922 | 1,698,678 | |
Depreciation | 270,900 | 256,900 | $ 297,000 |
Mining Equipment | |||
PROPERTY, PLANT AND EQUIPMENT | |||
Property, plant and equipment, at cost | 1,927,603 | 1,896,470 | |
Land And Mineral Rights | |||
PROPERTY, PLANT AND EQUIPMENT | |||
Property, plant and equipment, at cost | 499,950 | 458,440 | |
Coal reserves not subject to depletion | 29,900 | 37,400 | |
Oil and gas mineral interests | |||
PROPERTY, PLANT AND EQUIPMENT | |||
Property, plant and equipment, at cost | 740,635 | 647,864 | |
Unproved properties | 383,600 | 355,100 | |
Buildings, Office Equipment And Improvements | |||
PROPERTY, PLANT AND EQUIPMENT | |||
Property, plant and equipment, at cost | 300,436 | 282,902 | |
Construction and mine development in progress | |||
PROPERTY, PLANT AND EQUIPMENT | |||
Property, plant and equipment, at cost | 99,042 | 44,217 | |
Mine development costs | |||
PROPERTY, PLANT AND EQUIPMENT | |||
Property, plant and equipment, at cost | 289,724 | $ 278,454 | |
Mine development costs | $ 11,300 |
LONG-TERM DEBT - Components (De
LONG-TERM DEBT - Components (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Principal | ||
Aggregate maturities of long-term debt | $ 427,009 | $ 443,080 |
Less current maturities | (24,970) | (16,071) |
Total long-term debt | 402,039 | 427,009 |
Unamortized Discount and Debt Issuance Costs | ||
Unamortized debt issuance costs including current and non-current | (4,836) | (8,067) |
Total unamortized debt issuance costs | (4,836) | (8,067) |
Replaced credit facility | ||
Unamortized Discount and Debt Issuance Costs | ||
Unamortized debt issuance costs including current and non-current | (2,702) | (5,019) |
Senior notes due 2025 | ||
Principal | ||
Aggregate maturities of long-term debt | 400,000 | 400,000 |
Unamortized Discount and Debt Issuance Costs | ||
Unamortized debt issuance costs including current and non-current | (2,134) | (3,048) |
May 2019 equipment financing | ||
Principal | ||
Aggregate maturities of long-term debt | 1,503 | |
November 2019 equipment financing | ||
Principal | ||
Aggregate maturities of long-term debt | 21,072 | 31,972 |
June 2020 equipment financing | ||
Principal | ||
Aggregate maturities of long-term debt | $ 5,937 | $ 9,605 |
LONG-TERM DEBT - Credit Facilit
LONG-TERM DEBT - Credit Facility (Details) $ in Millions | 12 Months Ended | ||
Jan. 13, 2023 USD ($) | Mar. 09, 2020 USD ($) | Dec. 31, 2022 USD ($) | |
Credit Agreement | |||
Long-Term Debt | |||
Maximum borrowing capacity | $ 425 | ||
Minimum liquidity to extend maturity | $ 200 | ||
Interest rate (as a percent) | 6.25% | ||
Interest coverage ratio | 3 | ||
Credit Agreement | Overnight Bank Funding Rate | |||
Long-Term Debt | |||
Basis spread for variable interest rate (as a percent) | 0.50% | ||
Credit Agreement | Daily Simple Secured Overnight Financing Rate | |||
Long-Term Debt | |||
Basis spread for variable interest rate (as a percent) | 1% | ||
Credit Agreement | Alliance Coal | |||
Long-Term Debt | |||
ARLP debt arrangements requirements, debt to cash flow ratio | 1.5 | ||
Credit Agreement | Alliance Coal and Intermediate Partnership | |||
Long-Term Debt | |||
ARLP debt arrangements requirements, debt to cash flow ratio | 2.5 | ||
Letters of credit subfacility | |||
Long-Term Debt | |||
Maximum borrowing capacity | $ 425 | $ 125 | |
Swingline subfacility | |||
Long-Term Debt | |||
Maximum borrowing capacity | 15 | 15 | |
Term Loan | |||
Long-Term Debt | |||
Maximum borrowing term loan | $ 75 | ||
Replaced credit facility | |||
Long-Term Debt | |||
Maximum borrowing capacity | $ 459.5 | ||
Letters of credit outstanding | $ 41.1 | ||
Debt available for borrowing | $ 418.4 | ||
Annual commitment fee percentage, undrawn portion | 0.35% | ||
ARLP debt arrangements requirements, debt to cash flow ratio | 2.5 | ||
ARLP debt arrangements requirements, cash flow to interest expense ratio | 3 | ||
Actual debt to cash flow ratio for trailing twelve months | 0.52 | ||
Actual cash flow to interest expense ratio for trailing twelve months | 21.76 | ||
Restricted net assets of subsidiaries | $ 537.3 | ||
Replaced credit facility | Eurodollar Rate | |||
Long-Term Debt | |||
Effective interest rate (as a percent) | 6.74% | ||
Replaced credit facility | Credit Agreement, first lien | |||
Long-Term Debt | |||
ARLP debt arrangements requirements, debt to cash flow ratio | 1.5 | ||
Actual debt to cash flow ratio for trailing twelve months | 0.03 | ||
Other | |||
Long-Term Debt | |||
Maximum borrowing capacity | $ 5 | ||
Letters of credit outstanding | $ 5 |
LONG-TERM DEBT - 2025 Senior No
LONG-TERM DEBT - 2025 Senior Notes (Details) - Senior notes due 2025 $ in Millions | Apr. 24, 2017 USD ($) |
Issuance of Senior Notes | |
Principal amount | $ 400 |
Term | 8 years |
Interest rate (as a percent) | 7.50% |
LONG-TERM DEBT - Securitization
LONG-TERM DEBT - Securitization Facility (Details) - Securitization Facility $ in Millions | Dec. 31, 2022 USD ($) |
Long-Term Debt | |
Maximum borrowing capacity | $ 60 |
Letters of credit outstanding | 11.7 |
Debt available for borrowing | 48.3 |
Facility outstanding amount | $ 0 |
LONG-TERM DEBT - Equipment fina
LONG-TERM DEBT - Equipment financing and other (Details) $ in Millions | Jun. 05, 2020 USD ($) | Nov. 06, 2019 USD ($) payment | May 17, 2019 USD ($) |
May 2019 Equipment Financing | |||
Long-Term Debt | |||
Principal amount | $ 10 | ||
Term | 36 months | ||
Effective interest rate (as a percent) | 6.25% | ||
November 2019 Equipment Financing | |||
Long-Term Debt | |||
Principal amount | $ 53.1 | ||
Term | 4 years | ||
Effective interest rate (as a percent) | 4.75% | ||
Number of monthly payments | payment | 47 | ||
Periodic Payment | $ 1 | ||
Balloon payment on maturity | $ 11.6 | ||
June 2020 equipment financing | |||
Long-Term Debt | |||
Principal amount | $ 14.7 | ||
Term | 48 months | ||
Effective interest rate (as a percent) | 6.10% |
LONG-TERM DEBT - Maturities (De
LONG-TERM DEBT - Maturities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Aggregate maturities of long-term debt | ||
2023 | $ 24,970 | |
2024 | 2,039 | |
2025 | 400,000 | |
Aggregate maturities of long-term debt | $ 427,009 | $ 443,080 |
INCOME TAXES - Components (Deta
INCOME TAXES - Components (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Current: | |||
Federal | $ 17,572 | $ (1) | $ (78) |
State | 1,605 | 70 | 1 |
Total current income tax expense | 19,177 | 69 | (77) |
Deferred: | |||
Federal | 33,038 | 356 | (178) |
State | 1,763 | (8) | 290 |
Total deferred income tax expense | 34,801 | 348 | 112 |
Income tax expense | $ 53,978 | $ 417 | $ 35 |
INCOME TAXES - Tax election (De
INCOME TAXES - Tax election (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Taxes | ||||
Deferred tax liability | $ 35,126 | $ 350 | ||
Income tax expense | $ 53,978 | $ 417 | $ 35 | |
Earnings per limited partner unit - basic (in dollars per unit) | $ 4.39 | $ 1.36 | $ (1.02) | |
Earnings per limited partner unit - diluted (in dollars per unit) | $ 4.39 | $ 1.36 | $ (1.02) | |
AllDale I and II | ||||
Taxes | ||||
Non - cash acquisition gain recognized | $ 177,000 | |||
Change in tax accounting | ||||
Taxes | ||||
Deferred tax liability | $ 37,300 | |||
Income tax expense | $ 37,300 | |||
Earnings per limited partner unit - basic (in dollars per unit) | $ 0.29 | |||
Earnings per limited partner unit - diluted (in dollars per unit) | $ 0.29 |
INCOME TAXES - Reconciliation (
INCOME TAXES - Reconciliation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
INCOME TAXES | |||
Income taxes at statutory rate | $ 132,956 | $ 37,626 | $ (27,093) |
Less: Income taxes at statutory rate on Partnership income not subject to income taxes | (112,032) | (36,577) | 26,293 |
Increase/(decrease) resulting from: | |||
State taxes, net of federal income tax | 1,492 | 275 | (192) |
Change in valuation allowance of deferred tax assets | (317) | (834) | 1,151 |
Deferred taxes related to tax election | 37,253 | ||
Tax effect of noncontrolling interest income not subject to income taxes | (5,399) | ||
Other | 25 | (73) | (124) |
Income tax expense | $ 53,978 | $ 417 | $ 35 |
INCOME TAXES - Deferred tax (De
INCOME TAXES - Deferred tax (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Deferred tax liabilities: | ||
Property, plant and equipment | $ (38,349) | $ (2,169) |
Deferred tax liabilities | (38,349) | (2,169) |
Deferred tax assets: | ||
Federal loss carryovers and credits | 2,139 | 1,328 |
Other | 1,084 | 808 |
Total deferred tax assets | 3,223 | 2,136 |
Less valuation allowance | (317) | |
Net deferred tax assets | 3,223 | 1,819 |
Overall net deferred tax liabilities | $ (35,126) | $ (350) |
LEASES - Lease expense (Details
LEASES - Lease expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
LEASES | |||
Amortization of right-of-use assets | $ 597 | $ 597 | $ 704 |
Interest on lease liabilities | 73 | 147 | 377 |
Operating lease cost | 274 | 2,404 | 3,873 |
Short-term lease cost | 200 | 84 | |
Variable lease cost | 1,665 | 1,306 | 1,375 |
Total lease cost | 2,609 | 4,654 | 6,413 |
Rental expense | $ 5,100 | $ 3,300 | $ 5,200 |
LEASES - Cash flow (Details)
LEASES - Cash flow (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
LEASES | |||
Operating cash flows for operating leases | $ 2,880 | $ 2,367 | $ 3,870 |
Operating cash flows for finance leases | 73 | 147 | 377 |
Financing cash flows for finance leases | 840 | 766 | 8,368 |
Operating leases, Right-of-use assets obtained in exchange for lease obligations | $ 1,315 | $ 189 | $ 278 |
LEASES - Balance Sheet (Details
LEASES - Balance Sheet (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Lease balance sheet information | ||
Property and equipment finance lease assets, gross | $ 5,485 | $ 5,485 |
Accumulated depreciation | (5,061) | (4,464) |
Property and equipment finance lease assets, net | $ 424 | $ 1,021 |
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | Property, Plant, and Equipment and Finance Lease Right-of-Use Asset, after Accumulated Depreciation and Amortization | Property, Plant, and Equipment and Finance Lease Right-of-Use Asset, after Accumulated Depreciation and Amortization |
LEASES - Weighted Average (Deta
LEASES - Weighted Average (Details) | Dec. 31, 2022 | Dec. 31, 2021 |
LEASES | ||
Weighted average remaining lease term of operating leases | 13 years 4 months 24 days | 15 years 6 months |
Weighted average remaining lease term of finance leases | 5 years | 3 years 6 months |
Weighted average discount rate of operating leases (as a percent) | 6% | 6% |
Weighted average discount rate of finance leases (as a percent) | 4.80% | 7.40% |
LEASES - Maturities (Details)
LEASES - Maturities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Operating leases | ||
2023 | $ 3,253 | |
2024 | 2,918 | |
2025 | 1,734 | |
2026 | 1,106 | |
2027 | 1,112 | |
Thereafter | 11,901 | |
Total lease payments | 22,024 | |
Less imputed interest | $ (7,100) | |
Operating Lease, Liability, Statement of Financial Position [Extensible Enumeration] | Operating Lease, Liability, Noncurrent, Other Liabilities, Current | Operating Lease, Liability, Noncurrent, Other Liabilities, Current |
Finance leases | ||
2023 | $ 140 | |
2024 | 140 | |
2025 | 140 | |
2026 | 140 | |
2027 | 140 | |
Total lease payments | 700 | |
Less imputed interest | $ (82) | |
Finance Lease, Liability, Statement of Financial Position [Extensible Enumeration] | Other Liabilities, Current, Other Liabilities, Noncurrent | Other Liabilities, Current, Other Liabilities, Noncurrent |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details) - Estimated fair value - Significant Observable Inputs (Level 2) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
FAIR VALUE MEASUREMENTS | ||
Long-term debt | $ 424,420 | $ 457,758 |
Total | $ 424,420 | $ 457,758 |
PARTNERS' CAPITAL - Distributio
PARTNERS' CAPITAL - Distributions (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 12 Months Ended | ||||||||
Jan. 27, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2020 | Dec. 31, 2022 | |
PARTNERS' CAPITAL | ||||||||||
Period following quarter end for distribution of available cash | 45 days | |||||||||
Quarterly distribution paid (in dollars per unit) | $ 0.500 | $ 0.400 | $ 0.350 | $ 0.250 | $ 0.200 | $ 0.100 | $ 0.100 | $ 0.400 | ||
Distribution declared (in dollars per unit) | $ 0.70 | |||||||||
Quarterly distribution declared | $ 89 |
PARTNERS' CAPITAL - Narrative (
PARTNERS' CAPITAL - Narrative (Details) - USD ($) $ / shares in Units, $ in Millions | 1 Months Ended | 12 Months Ended | 56 Months Ended | 57 Months Ended | |
Jan. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2022 | Jan. 31, 2023 | May 31, 2018 | |
Partners' capital | |||||
Treasury units retired | $ 0 | ||||
Limited Partners' Capital | |||||
Partners' capital | |||||
Repurchase and retire authorization | $ 100 | $ 100 | $ 100 | ||
Treasury units retired | $ 93.5 | $ 18.1 | |||
Number of units retired | 5,460,639 | 856,629 | |||
Repurchase price (in dollars per unit) | $ 17.12 | $ 21.15 | |||
Increase in authorization amount | $ 93.5 | ||||
Available Capacity | $ 6.5 | $ 6.5 |
VARIABLE INTEREST ENTITIES - Ca
VARIABLE INTEREST ENTITIES - Cavalier (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Variable Interest Entities | |||
Distributions paid to Partners | $ 196,347 | $ 52,158 | $ 51,753 |
Cavalier Minerals | Alliance Minerals | |||
Variable Interest Entities | |||
Contributions | 143,112 | ||
Distributions paid to Partners | 146,484 | ||
Cavalier Minerals | Bluegrass Minerals | |||
Variable Interest Entities | |||
Contributions | 5,963 | ||
Distributions paid to Partners | $ 6,179 | ||
Cavalier Minerals | Bluegrass Minerals | |||
Variable Interest Entities | |||
Incentive distribution of available cash (as a percent) | 25% | ||
Cavalier Minerals | |||
Variable Interest Entities | |||
Ownership interest in VIE (as a percent) | 96% | ||
Cavalier Minerals | Bluegrass Minerals | |||
Variable Interest Entities | |||
Noncontrolling ownership interest (as a percent) | 4% |
VARIABLE INTEREST ENTITIES - Al
VARIABLE INTEREST ENTITIES - All Dale III (Detail) - All Dale Minerals III - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Feb. 28, 2017 | |
Investments | ||
Other Commitment | $ 30 | |
Distribution after hurdles (as a percent) | 25% | |
Specified internal rate of return (as a percent) | 10% | |
Percentage of available cash distributed | 125% | |
All Dale Minerals III | ||
Investments | ||
Ownership percentage by limited partners | 13.90% |
VARIABLE INTEREST ENTITIES - In
VARIABLE INTEREST ENTITIES - Investments (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Apr. 05, 2022 | Dec. 31, 2022 | Jun. 02, 2022 | |
Investments | |||
Contributions to equity method investments | $ 24,087 | ||
Francis Renewable Energy | |||
Investments | |||
Contributions to equity method investments | $ 20,000 | 20,000 | |
NGP ETP | |||
Investments | |||
Funding commitment | $ 25,000 | ||
Contributions to equity method investments | $ 4,087 |
INVESTMENTS - Equity method (De
INVESTMENTS - Equity method (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Apr. 05, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Investments | ||||
Beginning balance | $ 26,325 | |||
Contributions | 24,087 | |||
Equity method investment income | 5,634 | $ 2,130 | $ 907 | |
Ending balance | 49,371 | 26,325 | ||
All Dale Minerals III | ||||
Investments | ||||
Beginning balance | 26,325 | 27,268 | 28,529 | |
Equity method investment income | 5,634 | 2,130 | 907 | |
Distributions received | (6,675) | (3,073) | (1,895) | |
Other | (273) | |||
Ending balance | 25,284 | $ 26,325 | $ 27,268 | |
Francis Renewable Energy | ||||
Investments | ||||
Contributions | $ 20,000 | 20,000 | ||
Ending balance | 20,000 | |||
NGP ETP | ||||
Investments | ||||
Contributions | 4,087 | |||
Ending balance | $ 4,087 |
INVESTMENTS - Non-equity method
INVESTMENTS - Non-equity method (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Nov. 02, 2022 | Apr. 29, 2022 | Dec. 31, 2022 | |
Investments | |||
Contributions | $ 42,000 | ||
Ending balance | 42,000 | ||
Infinitum Electric | |||
Investments | |||
Contributions | $ 9,400 | $ 32,600 | 42,000 |
Ending balance | $ 42,000 |
REVENUE FROM CONTRACTS WITH C_3
REVENUE FROM CONTRACTS WITH CUSTOMERS - Disaggregation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Disaggregation of revenues | |||
Revenues | $ 2,406,511 | $ 1,569,976 | $ 1,328,129 |
Illinois Basin | |||
Disaggregation of revenues | |||
Revenues | 1,296,305 | 919,597 | 769,957 |
Appalachia | |||
Disaggregation of revenues | |||
Revenues | 928,087 | 545,539 | 500,330 |
Oil & Gas Royalties | |||
Disaggregation of revenues | |||
Revenues | 141,441 | 77,185 | 43,141 |
Coal Royalties | |||
Disaggregation of revenues | |||
Revenues | 60,680 | 51,471 | 42,217 |
Other, Corporate and Elimination | |||
Disaggregation of revenues | |||
Revenues | (20,002) | (23,816) | (27,516) |
Coal sales | |||
Disaggregation of revenues | |||
Revenues | 2,102,229 | 1,386,923 | 1,232,272 |
Coal sales | Illinois Basin | |||
Disaggregation of revenues | |||
Revenues | 1,219,943 | 873,930 | 755,208 |
Coal sales | Appalachia | |||
Disaggregation of revenues | |||
Revenues | 882,286 | 512,993 | 477,064 |
Oil & gas royalties | |||
Disaggregation of revenues | |||
Revenues | 138,402 | 74,988 | 42,912 |
Oil & gas royalties | Oil & Gas Royalties | |||
Disaggregation of revenues | |||
Revenues | 138,402 | 74,988 | 42,912 |
Coal royalties | Coal Royalties | |||
Disaggregation of revenues | |||
Revenues | 60,624 | 51,402 | 42,112 |
Coal royalties | Other, Corporate and Elimination | |||
Disaggregation of revenues | |||
Revenues | (60,624) | (51,402) | (42,112) |
Transportation | |||
Disaggregation of revenues | |||
Revenues | 113,860 | 69,607 | 21,129 |
Transportation | Illinois Basin | |||
Disaggregation of revenues | |||
Revenues | 69,540 | 41,001 | 12,817 |
Transportation | Appalachia | |||
Disaggregation of revenues | |||
Revenues | 44,320 | 28,606 | 8,312 |
Other revenues | |||
Disaggregation of revenues | |||
Revenues | 52,020 | 38,458 | 31,816 |
Other revenues | Illinois Basin | |||
Disaggregation of revenues | |||
Revenues | 6,822 | 4,666 | 1,932 |
Other revenues | Appalachia | |||
Disaggregation of revenues | |||
Revenues | 1,481 | 3,940 | 14,954 |
Other revenues | Oil & Gas Royalties | |||
Disaggregation of revenues | |||
Revenues | 3,039 | 2,197 | 229 |
Other revenues | Coal Royalties | |||
Disaggregation of revenues | |||
Revenues | 56 | 69 | 105 |
Other revenues | Other, Corporate and Elimination | |||
Disaggregation of revenues | |||
Revenues | $ 40,622 | $ 27,586 | $ 14,596 |
REVENUE FROM CONTRACTS WITH C_4
REVENUE FROM CONTRACTS WITH CUSTOMERS - Supply contracts (Details) $ in Thousands | Dec. 31, 2022 USD ($) |
Performance obligations unsatisfied or partially unsatisfied | |
Total | $ 4,113,892 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | |
Performance obligations unsatisfied or partially unsatisfied | |
Total | $ 1,951,694 |
Expected timing of satisfaction period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01 | |
Performance obligations unsatisfied or partially unsatisfied | |
Total | $ 1,263,472 |
Expected timing of satisfaction period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-01-01 | |
Performance obligations unsatisfied or partially unsatisfied | |
Total | $ 653,526 |
Expected timing of satisfaction period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2026-01-01 | |
Performance obligations unsatisfied or partially unsatisfied | |
Total | $ 245,200 |
Expected timing of satisfaction period | 1 year |
Illinois Basin | |
Performance obligations unsatisfied or partially unsatisfied | |
Total | $ 2,549,577 |
Illinois Basin | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | |
Performance obligations unsatisfied or partially unsatisfied | |
Total | $ 1,230,551 |
Expected timing of satisfaction period | 1 year |
Illinois Basin | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01 | |
Performance obligations unsatisfied or partially unsatisfied | |
Total | $ 730,825 |
Expected timing of satisfaction period | 1 year |
Illinois Basin | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-01-01 | |
Performance obligations unsatisfied or partially unsatisfied | |
Total | $ 344,601 |
Expected timing of satisfaction period | 1 year |
Illinois Basin | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2026-01-01 | |
Performance obligations unsatisfied or partially unsatisfied | |
Total | $ 243,600 |
Expected timing of satisfaction period | 1 year |
Appalachia | |
Performance obligations unsatisfied or partially unsatisfied | |
Total | $ 1,564,315 |
Appalachia | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | |
Performance obligations unsatisfied or partially unsatisfied | |
Total | $ 721,143 |
Expected timing of satisfaction period | 1 year |
Appalachia | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01 | |
Performance obligations unsatisfied or partially unsatisfied | |
Total | $ 532,647 |
Expected timing of satisfaction period | 1 year |
Appalachia | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-01-01 | |
Performance obligations unsatisfied or partially unsatisfied | |
Total | $ 308,925 |
Expected timing of satisfaction period | 1 year |
Appalachia | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2026-01-01 | |
Performance obligations unsatisfied or partially unsatisfied | |
Total | $ 1,600 |
Expected timing of satisfaction period | 1 year |
EARNINGS PER LIMITED PARTNER _3
EARNINGS PER LIMITED PARTNER UNIT - Reconciliation (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
EARNINGS PER LIMITED PARTNER UNIT | |||
Net income (loss) attributable to ARLP | $ 577,190 | $ 178,157 | $ (129,220) |
Distributions to participating securities | (8,527) | (2,334) | |
Undistributed earnings attributable to participating securities | (10,576) | (2,403) | |
Net income (loss) attributable to ARLP available to limited partners | $ 558,087 | $ 173,420 | $ (129,220) |
Weighted-average limited partner units outstanding - basic (in units) | 127,195,219 | 127,195,219 | 127,164,659 |
Weighted-average limited partner units outstanding - diluted (in units) | 127,195,000 | 127,195,000 | 127,165,000 |
Earnings per limited partner unit - basic (in dollars per unit) | $ 4.39 | $ 1.36 | $ (1.02) |
Earnings per limited partner unit - diluted (in dollars per unit) | $ 4.39 | $ 1.36 | $ (1.02) |
Anti-dilutive under the treasury stock method (in units) | 3,540,385 | 1,967,672 | 773,664 |
EMPLOYEE BENEFIT PLANS - Define
EMPLOYEE BENEFIT PLANS - Defined Contribution (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
PSSP | |||
Defined Contribution Plans | |||
Contribution expense | $ 19.4 | $ 17.7 | $ 16.1 |
EMPLOYEE BENEFIT PLANS - Obliga
EMPLOYEE BENEFIT PLANS - Obligations, Assets, Reported Amounts (Details) - Defined benefit pension plan - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Change in benefit obligations: | |||
Benefit obligations at beginning of year | $ 139,566 | $ 147,934 | |
Interest cost | 3,749 | 3,438 | $ 4,185 |
Actuarial gain | (32,996) | (6,406) | |
Benefits paid | (5,637) | (5,400) | |
Benefit obligations at end of year | 104,682 | 139,566 | 147,934 |
Change in plan assets: | |||
Fair value of plan assets at beginning of year | 113,976 | 100,969 | |
Employer contribution | 3,312 | ||
Actual return on plan assets | (16,210) | 15,095 | |
Benefits paid | (5,637) | (5,400) | |
Fair value of plan assets at end of year | 92,129 | 113,976 | $ 100,969 |
Funded status at the end of year | (12,553) | (25,590) | |
Amounts recognized in balance sheet: | |||
Non-current liability | (12,553) | (25,590) | |
Amount recognized in accumulated other comprehensive income consists of: | |||
Prior service cost | (382) | (568) | |
Net actuarial loss | (15,160) | (27,271) | |
Amounts recognized in accumulated other comprehensive income | $ (15,542) | $ (27,839) | |
Weighted-average assumption to determine benefit obligations | |||
Discount rate | 5.10% | 2.73% | |
Weighted-average assumptions used to determine net periodic benefit cost | |||
Discount rate | 2.73% | 2.37% | |
Expected return on plan assets | 6% | 6.50% |
EMPLOYEE BENEFIT PLANS - Assump
EMPLOYEE BENEFIT PLANS - Assumptions (Details) - Defined benefit pension plan | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Asset allocation assumptions | ||
Active management premium percentage | 1.50% | |
Asset allocation assumption | 100% | |
Actual return on plan assets (as a percent) | (14.60%) | 15.10% |
Equity securities | ||
Asset allocation assumptions | ||
Asset allocation assumption | 60% | |
Fixed income securities | ||
Asset allocation assumptions | ||
Asset allocation assumption | 35% | |
Real estate | ||
Asset allocation assumptions | ||
Asset allocation assumption | 5% |
EMPLOYEE BENEFIT PLANS - Period
EMPLOYEE BENEFIT PLANS - Periodic Benefit Cost (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Other changes in plan assets and benefit obligations recognized in accumulated other comprehensive loss: | |||
Total recognized in accumulated other comprehensive loss | $ 23,175 | $ 23,445 | $ (9,681) |
Defined benefit pension plan | |||
Components of net periodic benefit cost: | |||
Interest cost | $ 3,749 | $ 3,438 | $ 4,185 |
Defined Benefit Plan, Net Periodic Benefit Cost (Credit), Interest Cost, Statement of Income or Comprehensive Income [Extensible Enumeration] | Other Nonoperating Income (Expense) | Other Nonoperating Income (Expense) | Other Nonoperating Income (Expense) |
Expected return on plan assets | $ (6,638) | $ (6,580) | $ (5,861) |
Defined Benefit Plan, Net Periodic Benefit (Cost) Credit, Expected Return (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Other Nonoperating Income (Expense) | Other Nonoperating Income (Expense) | Other Nonoperating Income (Expense) |
Amortization of prior service cost | $ 186 | $ 186 | $ 186 |
Defined Benefit Plan, Net Periodic Benefit Cost (Credit), Amortization of Prior Service Cost (Credit), Statement of Income or Comprehensive Income [Extensible Enumeration] | Other Nonoperating Income (Expense) | Other Nonoperating Income (Expense) | Other Nonoperating Income (Expense) |
Amortization of net loss | $ 1,963 | $ 4,327 | $ 4,128 |
Defined Benefit Plan, Net Periodic Benefit (Cost) Credit, Amortization of Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Other Nonoperating Income (Expense) | Other Nonoperating Income (Expense) | Other Nonoperating Income (Expense) |
Net periodic benefit cost | $ (740) | $ 1,371 | $ 2,638 |
Other changes in plan assets and benefit obligations recognized in accumulated other comprehensive loss: | |||
Net actuarial gain | 10,148 | 14,921 | (5,522) |
Reversal of amortization item: Prior service cost | 186 | 186 | 186 |
Reversal of amortization item: Net actuarial loss | 1,963 | 4,327 | 4,128 |
Total recognized in accumulated other comprehensive loss | 12,297 | 19,434 | (1,208) |
Net periodic benefit cost (credit) | 740 | (1,371) | $ (2,638) |
Total recognized in net periodic benefit cost and accumulated other comprehensive loss | $ 13,037 | $ 18,063 |
EMPLOYEE BENEFIT PLANS - Estima
EMPLOYEE BENEFIT PLANS - Estimated Benefit Payments (Details) - Defined benefit pension plan $ in Thousands | Dec. 31, 2022 USD ($) |
Estimated future benefit payments | |
2023 | $ 6,239 |
2024 | 6,416 |
2025 | 6,605 |
2026 | 6,816 |
2027 | 6,907 |
2028-2032 | 35,293 |
Estimated future benefit payments | 68,276 |
Expected contribution for pension plan in next year | $ 0 |
EMPLOYEE BENEFIT PLANS - Asset
EMPLOYEE BENEFIT PLANS - Asset Allocations (Details) - Defined benefit pension plan | Dec. 31, 2022 |
Equity securities | Minimum | |
Employee Benefit Plans | |
Target allocation | 35% |
Equity securities | Maximum | |
Employee Benefit Plans | |
Target allocation | 80% |
Fixed income securities | Minimum | |
Employee Benefit Plans | |
Target allocation | 15% |
Fixed income securities | Maximum | |
Employee Benefit Plans | |
Target allocation | 65% |
Convertible securities | Minimum | |
Employee Benefit Plans | |
Target allocation | 0% |
Convertible securities | Maximum | |
Employee Benefit Plans | |
Target allocation | 10% |
Alternatives | Minimum | |
Employee Benefit Plans | |
Target allocation | 0% |
Alternatives | Maximum | |
Employee Benefit Plans | |
Target allocation | 20% |
EMPLOYEE BENEFIT PLANS - Fair V
EMPLOYEE BENEFIT PLANS - Fair Value of Plan Assets (Details) - Defined benefit pension plan - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Employee Benefit Plans | |||
Defined benefit plan, fair value of plan assets | $ 92,129 | $ 113,976 | $ 100,969 |
Cash And Cash Equivalents | Quoted Prices In Active Markets For Identical Assets (Level 1) | |||
Employee Benefit Plans | |||
Defined benefit plan, fair value of plan assets | 5,422 | 4,426 | |
Equities - Global | Net asset value per share | |||
Employee Benefit Plans | |||
Defined benefit plan, fair value of plan assets | 24,868 | ||
Equities - United States | Net asset value per share | |||
Employee Benefit Plans | |||
Defined benefit plan, fair value of plan assets | 36,259 | 41,140 | |
Equities - United States futures | Net asset value per share | |||
Employee Benefit Plans | |||
Defined benefit plan, fair value of plan assets | (697) | (2,055) | |
Equities - International developed markets | Net asset value per share | |||
Employee Benefit Plans | |||
Defined benefit plan, fair value of plan assets | 14,214 | 16,382 | |
Equities - International developed markets futures | Net asset value per share | |||
Employee Benefit Plans | |||
Defined benefit plan, fair value of plan assets | (1,693) | (16,260) | |
Equities - International emerging markets | Net asset value per share | |||
Employee Benefit Plans | |||
Defined benefit plan, fair value of plan assets | 782 | (3,363) | |
Equities - International emerging markets futures | Net asset value per share | |||
Employee Benefit Plans | |||
Defined benefit plan, fair value of plan assets | 3,289 | 7,024 | |
Fixed income - Investment grade | Net asset value per share | |||
Employee Benefit Plans | |||
Defined benefit plan, fair value of plan assets | 13,856 | 27,095 | |
Fixed income - High yield | Net asset value per share | |||
Employee Benefit Plans | |||
Defined benefit plan, fair value of plan assets | 156 | 177 | |
Fixed income - Futures | Net asset value per share | |||
Employee Benefit Plans | |||
Defined benefit plan, fair value of plan assets | 8,590 | (689) | |
Alternatives | Net asset value per share | |||
Employee Benefit Plans | |||
Defined benefit plan, fair value of plan assets | $ 11,951 | $ 15,231 |
COMMON UNIT-BASED COMPENSATIO_3
COMMON UNIT-BASED COMPENSATION PLANS - LTIP Grants (Details) - ARLP LTIP - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | ||||||
Jan. 27, 2023 | Dec. 31, 2020 | Feb. 29, 2020 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2017 | Dec. 31, 2019 | |
Number of units | ||||||||
Balance at the beginning of the period (in units) | 3,130,475 | 1,430,489 | 1,603,378 | |||||
Granted (in units) | 447,225 | 769,907 | 1,818,190 | 1,430,489 | 424,486 | |||
Vested (in units) | (919,524) | |||||||
Grants canceled (in units) | (675,302) | |||||||
Forfeited (in units) | (203,249) | (118,204) | (8,552) | |||||
Balance at the end of the period (in units) | 1,430,489 | 3,697,133 | 3,130,475 | 1,430,489 | ||||
Weighted average grant date fair value per unit | ||||||||
Balance at the beginning of the period (in dollars per unit) | $ 5.59 | $ 5.02 | $ 20.39 | |||||
Granted (in dollars per unit) | 14.65 | 6.03 | 5.02 | |||||
Vested (in dollars per unit) | $ 21.70 | |||||||
Grants canceled (in dollars per unit) | 18.62 | |||||||
Forfeited (in dollars per unit) | 6.93 | 5.48 | $ 20.16 | |||||
Balance at the end of the period (in dollars per unit) | $ 5.02 | $ 7.40 | $ 5.59 | $ 5.02 | ||||
Intrinsic value (in dollars) | ||||||||
Intrinsic value of outstanding grants (in dollars) | $ 6,409 | $ 75,126 | $ 39,569 | $ 6,409 | $ 17,349 | |||
Other information | ||||||||
Common units issued | 279,622 | |||||||
2018 Grants | ||||||||
Number of units | ||||||||
Vested (in units) | (495,038) | |||||||
2019 Grants | ||||||||
Number of units | ||||||||
Grants canceled (in units) | 675,302 | |||||||
2020 Grants | ||||||||
Number of units | ||||||||
Granted (in units) | 578,114 |
COMMON UNIT-BASED COMPENSATIO_4
COMMON UNIT-BASED COMPENSATION PLANS - LTIP Other (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Jan. 27, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Other information | ||||
Cash settlement of grants | $ 2,490 | |||
ARLP LTIP | ||||
Other information | ||||
Unit-based compensation expense | $ 9,400 | $ 5,400 | $ 8,100 | |
Reduction in compensation expense | 1,000 | |||
Total unit-based obligation recorded | 16,000 | $ 6,700 | ||
Unrecognized compensation expense (in dollars) | $ 11,400 | |||
Weighted-average period for recognition of expense | 9 months 18 days | |||
Additional grants authorized (in units) | 462,225 | |||
2018 Grants | ARLP LTIP | ||||
Other information | ||||
Incremental compensation cost | $ 5,400 | |||
2019 Grants | ARLP LTIP | ||||
Other information | ||||
Reversal of cumulative previously recognized expenses | $ 4,800 |
COMMON UNIT-BASED COMPENSATIO_5
COMMON UNIT-BASED COMPENSATION PLANS - SERP and Directors (Details) - SERP and Deferred Compensation Plans - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Other information | ||||
Unit-based compensation expense | $ 1,400 | $ 400 | $ 700 | |
Total unit-based obligation recorded | $ 15,100 | $ 13,500 | ||
Phantom Share Units (PSUs) | ||||
Number of units | ||||
Balance at the beginning of the period (in units) | 668,698 | 760,630 | 631,365 | |
Granted (in units) | 73,842 | 46,638 | 129,265 | |
Issued (in units) | (138,570) | |||
Balance at the end of the period (in units) | 742,540 | 668,698 | 760,630 | |
Weighted average grant date fair value per unit | ||||
Balance at the beginning of the period (in dollars per unit) | $ 20.37 | $ 22.04 | $ 25.48 | |
Granted (in dollars per unit) | 19.44 | 9.45 | 5.25 | |
Issued (in dollars per unit) | 25.86 | |||
Balance at the end of the period (in dollars per unit) | $ 20.28 | $ 20.37 | $ 22.04 | |
Intrinsic value (in dollars) | ||||
Intrinsic value of outstanding grants (in dollars) | $ 15,088 | $ 8,452 | $ 3,408 | $ 6,831 |
Other information | ||||
Purchased for awards (in shares) | 102,962 |
SUPPLEMENTAL CASH FLOW INFORM_3
SUPPLEMENTAL CASH FLOW INFORMATION (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Cash Paid For: | |||
Interest | $ 34,844 | $ 36,402 | $ 44,226 |
Income taxes | 23,794 | 11 | 12 |
Non-Cash Activity: | |||
Accounts payable for purchase of property, plant and equipment | 44,281 | 8,325 | 5,731 |
Right-of-use assets acquired by operating lease | $ 1,315 | 189 | 278 |
Market value of common units issued under deferred compensation plans before tax withholding requirements | $ 1,082 | $ 3,837 |
ASSET RETIREMENT OBLIGATIONS -
ASSET RETIREMENT OBLIGATIONS - Activity (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Asset retirement and mine closing liability | ||
Balance at the beginning of the period | $ 131,099 | $ 127,898 |
Accretion expense | 3,731 | 3,688 |
Payments | (2,445) | (1,383) |
Allocation of liability associated with mine development and change in assumptions | 17,428 | 896 |
Balance at the end of the period | $ 149,813 | $ 131,099 |
ASSET RETIREMENT OBLIGATIONS _2
ASSET RETIREMENT OBLIGATIONS - Estimated Payments (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Estimated payments of asset retirement obligations: | |||
2023 | $ 7,559 | ||
2024 | 4,936 | ||
2025 | 1,935 | ||
2026 | 1,569 | ||
2027 | 3,182 | ||
Thereafter | 241,065 | ||
Aggregate undiscounted asset retirement obligations | 260,246 | ||
Effect of discounting | (110,433) | $ (98,300) | |
Total asset retirement obligations | 149,813 | 131,099 | $ 127,898 |
Less: current portion | (7,559) | ||
Asset retirement obligations | 142,254 | 123,517 | |
Surety bonds outstanding to performance of reclamation obligations | $ 174,300 | $ 173,900 |
ACCRUED WORKERS' COMPENSATION_3
ACCRUED WORKERS' COMPENSATION AND PNEUMOCONIOSIS BENEFITS - Workers' Comp (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Reconciliation of changes in the workers' compensation liability | ||
Beginning balance | $ 53,448 | $ 54,739 |
Changes in accruals | 7,384 | 5,168 |
Payments | (12,708) | (10,725) |
Interest accretion | 1,147 | 926 |
Valuation loss | 181 | 3,340 |
Ending balance | $ 49,452 | $ 53,448 |
Estimated present value of future obligations and other information | ||
Workers' compensation discount rate | 4.87% | 2.41% |
Letters of credit outstanding to secure workers compensation obligations | $ 99,800 | $ 100,400 |
Other long-term assets | ||
Estimated present value of future obligations and other information | ||
Receivables for traumatic injury claims | $ 4,100 | $ 5,700 |
ACCRUED WORKERS' COMPENSATION_4
ACCRUED WORKERS' COMPENSATION AND PNEUMOCONIOSIS BENEFITS - Obligations (Details) - Pneumoconiosis benefits - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Reconciliation of the changes in black lung benefit obligations | |||
Benefit obligations at beginning of year | $ 111,316 | $ 108,496 | |
Service cost | 3,798 | 4,021 | $ 3,526 |
Interest cost | 2,991 | 2,545 | 2,998 |
Actuarial loss (gain) | (9,840) | 161 | |
Benefits and expenses paid | (3,978) | (3,907) | |
Benefit obligations at end of year | $ 104,287 | $ 111,316 | $ 108,496 |
ACCRUED WORKERS' COMPENSATION_5
ACCRUED WORKERS' COMPENSATION AND PNEUMOCONIOSIS BENEFITS - AOCL (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Other changes in plan assets and benefit obligations recognized in accumulated other comprehensive loss: | |||
Total recognized in accumulated other comprehensive loss | $ 23,175 | $ 23,445 | $ (9,681) |
Pneumoconiosis benefits | |||
Other changes in plan assets and benefit obligations recognized in accumulated other comprehensive loss: | |||
Net actuarial gain (loss) | 9,840 | (161) | (7,787) |
Reversal of amortization item: Net actuarial loss (gain) | 1,038 | 4,172 | (686) |
Total recognized in accumulated other comprehensive loss | $ 10,878 | $ 4,011 | $ (8,473) |
Estimated present value of future obligations and other information | |||
Pneumoconiosis discount rate | 5% | 2.73% | 2.38% |
Amount recognized in accumulated other comprehensive income consists of: | |||
Net actuarial loss | $ 25,510 | $ 36,388 | $ 40,399 |
ACCRUED WORKERS' COMPENSATION_6
ACCRUED WORKERS' COMPENSATION AND PNEUMOCONIOSIS BENEFITS - Balance Sheet (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
WORKERS' COMPENSATION AND PNEUMOCONIOSIS | |||
Workers' compensation claims | $ 49,452 | $ 53,448 | $ 54,739 |
Pneumoconiosis benefit claims | 104,287 | 111,316 | |
Total obligations | 153,739 | 164,764 | |
Less current portion | (14,099) | (12,293) | |
Non-current obligations | $ 139,640 | $ 152,471 |
ACCRUED WORKERS' COMPENSATION_7
ACCRUED WORKERS' COMPENSATION AND PNEUMOCONIOSIS BENEFITS - Expense (Details) - Pneumoconiosis benefits - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Black lung benefits: | |||
Service cost | $ 3,798 | $ 4,021 | $ 3,526 |
Interest cost | $ 2,991 | $ 2,545 | $ 2,998 |
Defined Benefit Plan, Net Periodic Benefit Cost (Credit), Interest Cost, Statement of Income or Comprehensive Income [Extensible Enumeration] | Other Nonoperating Income (Expense) | Other Nonoperating Income (Expense) | Other Nonoperating Income (Expense) |
Net amortization | $ 1,038 | $ 4,172 | $ (686) |
Defined Benefit Plan, Net Periodic Benefit (Cost) Credit, Amortization of Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Other Nonoperating Income (Expense) | Other Nonoperating Income (Expense) | Other Nonoperating Income (Expense) |
Total pneumoconiosis expense | $ 7,827 | $ 10,738 | $ 5,838 |
Workers' compensation expense | 11,675 | 8,339 | 12,305 |
Net periodic benefit cost | $ 19,502 | $ 19,077 | $ 18,143 |
RELATED-PARTY TRANSACTIONS - Li
RELATED-PARTY TRANSACTIONS - Line of Credit (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Nov. 04, 2021 | Feb. 19, 2021 | |
Related Party Transaction | |||
Proceeds from line of credit | $ 5,340 | ||
Payments under line of credit | 5,340 | ||
Line of credit | |||
Related Party Transaction | |||
Maximum borrowing capacity | $ 5,500 | $ 5,000 | |
Interest rate (as a percent) | 3.50% | ||
Proceeds from line of credit | 5,300 | ||
Payments under line of credit | $ 5,300 |
RELATED-PARTY TRANSACTIONS - Af
RELATED-PARTY TRANSACTIONS - Affiliate Royalty Agreements (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Related Party Transaction | |||
As of the beginning of period | $ 55,613 | ||
As of the end of period | 60,608 | $ 55,613 | |
Coal lease | |||
Related Party Transaction | |||
As of the beginning of period | 55,613 | 48,389 | $ 41,216 |
Payments | 11,250 | 13,817 | 13,819 |
Recoupment | (6,255) | (4,025) | (4,078) |
Unrecoupable | (2,568) | (2,568) | |
As of the end of period | 60,608 | 55,613 | 48,389 |
Tunnel Ridge | |||
Related Party Transaction | |||
As of the beginning of period | 1,500 | 1,500 | 1,500 |
Payments | 3,000 | 3,000 | 3,000 |
Recoupment | (3,000) | (3,000) | (3,000) |
As of the end of period | 1,500 | 1,500 | 1,500 |
WKY CoalPlay | December 2014 coal lease - Henderson and Union Counties, Kentucky | |||
Related Party Transaction | |||
As of the beginning of period | 21,750 | 19,178 | 16,603 |
Payments | 3,597 | 3,597 | 3,597 |
Recoupment | (3,255) | (1,025) | (1,022) |
As of the end of period | 22,092 | 21,750 | 19,178 |
WKY CoalPlay | December 2014 coal lease - Webster County, Kentucky | |||
Related Party Transaction | |||
Payments | 2,568 | 2,568 | |
Unrecoupable | (2,568) | (2,568) | |
WKY CoalPlay | December 2014 coal lease - Henderson County, Kentucky | |||
Related Party Transaction | |||
As of the beginning of period | 17,650 | 15,129 | 12,607 |
Payments | 2,522 | 2,521 | 2,522 |
As of the end of period | 20,172 | 17,650 | 15,129 |
WKY CoalPlay | February 2015 coal lease - Henderson and Union Counties, Kentucky | |||
Related Party Transaction | |||
As of the beginning of period | 14,713 | 12,582 | 10,506 |
Payments | 2,131 | 2,131 | 2,132 |
Recoupment | (56) | ||
As of the end of period | $ 16,844 | $ 14,713 | $ 12,582 |
RELATED-PARTY TRANSACTIONS - Cr
RELATED-PARTY TRANSACTIONS - Craft Foundations (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2018 | |
Tunnel Ridge | ||||
Related Party Transaction | ||||
Related party purchase | $ 0.2 | |||
Tunnel Ridge | ||||
Related Party Transaction | ||||
Annual minimum coal royalties | 3 | |||
Payments for earned royalties | $ 12.3 | $ 5.8 | $ 6.1 | |
Tunnel Ridge | Joseph W Craft III Foundation | Tunnel Ridge | ||||
Related Party Transaction | ||||
Property ownership (as a percent) | 50% | |||
Tunnel Ridge | Kathleen S Craft Foundation | Tunnel Ridge | ||||
Related Party Transaction | ||||
Property ownership (as a percent) | 50% |
RELATED-PARTY TRANSACTIONS - WK
RELATED-PARTY TRANSACTIONS - WKY CoalPlay and Cavalier Minerals (Details) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended | |
Feb. 28, 2015 | Dec. 31, 2014 | Dec. 31, 2022 | |
WKY CoalPlay | February 2015 coal lease - Henderson and Union Counties, Kentucky | |||
Related Party Transaction | |||
Initial term of lease | 20 years | ||
Percentage of earned royalty on coal sale price | 4% | ||
Annual minimum coal royalties | $ 2.1 | ||
WKY CoalPlay | December 2014 coal lease - Henderson and Union Counties, Kentucky | |||
Related Party Transaction | |||
Initial term of lease | 20 years | ||
Percentage of earned royalty on coal sale price | 4% | ||
Annual minimum coal royalties | $ 3.6 | ||
WKY CoalPlay | December 2014 coal lease - Webster County, Kentucky | |||
Related Party Transaction | |||
Initial term of lease | 7 years | ||
Percentage of earned royalty on coal sale price | 4% | ||
Annual minimum coal royalties | $ 2.6 | ||
WKY CoalPlay | December 2014 coal lease - Henderson County, Kentucky | |||
Related Party Transaction | |||
Annual minimum coal royalties | $ 2.5 | ||
Cavalier Minerals | |||
Related Party Transaction | |||
Ownership interest in VIE (as a percent) | 96% | ||
Cavalier Minerals | Bluegrass Minerals | |||
Related Party Transaction | |||
Noncontrolling ownership interest (as a percent) | 4% | ||
Profits interest (as a percent) | 25% |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Purchase Commitments (Details) $ in Millions | Dec. 31, 2022 USD ($) |
Commitments for external coal purchases | |
Contractual Commitments | |
Commitments to purchase coal | $ 0 |
Commitments related to planned capital projects | |
Contractual Commitments | |
Contractual amount | $ 147.7 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES - Insurance (Details) - Property and casualty insurance $ in Millions | Dec. 01, 2022 USD ($) |
Commitments And Contingencies | |
Aggregate maximum insurance limit | $ 100 |
Insurance deductible | $ 1.5 |
Waiting period one | 75 days |
Waiting period | 90 days |
Overall aggregate deductible | $ 25 |
CONCENTRATION OF CREDIT RISK _3
CONCENTRATION OF CREDIT RISK AND MAJOR CUSTOMERS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Major Customers | |||
Revenues | $ 2,406,511 | $ 1,569,976 | $ 1,328,129 |
Trade receivables | $ 238,610 | $ 129,531 | |
Revenue | Geographic Concentration Risk | End users in Europe, Africa, Asia, North America and South America | |||
Major Customers | |||
Concentration of risk (as a percent) | 12.50% | 12.50% | 3.30% |
Revenue | Customer Concentration Risk | Customer A | |||
Major Customers | |||
Revenues | $ 328,406 | $ 239,482 | $ 197,379 |
Revenue | Customer Concentration Risk | Customer B | |||
Major Customers | |||
Revenues | 260,146 | 157,271 | |
Revenue | Customer Concentration Risk | Customer C | |||
Major Customers | |||
Revenues | 228,480 | ||
Revenue | Customer Concentration Risk | Customer D | |||
Major Customers | |||
Revenues | $ 137,785 | ||
Trade accounts receivable | Customer Concentration Risk | Major Customers | |||
Major Customers | |||
Trade receivables | $ 63,600 | $ 10,800 |
SEGMENT INFORMATION - General (
SEGMENT INFORMATION - General (Details) | 12 Months Ended |
Dec. 31, 2022 segment | |
SEGMENT INFORMATION | |
Number of reportable segments | 4 |
Number Of Coal Reportable Segments | 2 |
Number Of Mining Complex | 7 |
SEGMENT INFORMATION - Segment R
SEGMENT INFORMATION - Segment Results (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Reportable segment results | |||
Revenues | $ 2,406,511 | $ 1,569,976 | $ 1,328,129 |
Segment Adjusted EBITDA Expense | 1,282,433 | 952,649 | 861,249 |
Segment Adjusted EBITDA | 1,020,558 | 549,252 | 446,489 |
Total assets | 2,661,473 | 2,159,406 | 2,166,016 |
Capital expenditures | 286,394 | 122,984 | 121,101 |
Illinois Basin | |||
Reportable segment results | |||
Revenues | 1,296,305 | 919,597 | 769,957 |
Segment Adjusted EBITDA Expense | 806,080 | 613,303 | 543,264 |
Segment Adjusted EBITDA | 420,684 | 265,292 | 213,876 |
Total assets | 779,018 | 676,091 | 738,315 |
Capital expenditures | 158,624 | 60,166 | 48,636 |
Appalachia | |||
Reportable segment results | |||
Revenues | 928,087 | 545,539 | 500,330 |
Segment Adjusted EBITDA Expense | 464,029 | 344,332 | 320,656 |
Segment Adjusted EBITDA | 426,402 | 172,601 | 171,362 |
Total assets | 431,913 | 420,144 | 440,815 |
Capital expenditures | 76,603 | 47,577 | 70,960 |
Oil & Gas Royalties | |||
Reportable segment results | |||
Revenues | 141,441 | 77,185 | 43,141 |
Segment Adjusted EBITDA Expense | 13,950 | 9,943 | 4,106 |
Segment Adjusted EBITDA | 131,168 | 68,774 | 39,773 |
Total assets | 711,917 | 630,627 | 613,916 |
Coal Royalties | |||
Reportable segment results | |||
Revenues | 60,680 | 51,471 | 42,217 |
Segment Adjusted EBITDA Expense | 21,871 | 18,269 | 18,249 |
Segment Adjusted EBITDA | 38,809 | 33,202 | 23,968 |
Total assets | 321,587 | 285,943 | 288,525 |
Capital expenditures | 38,276 | 45 | 12 |
Other, Corporate and Elimination | |||
Reportable segment results | |||
Revenues | (20,002) | (23,816) | (27,516) |
Segment Adjusted EBITDA Expense | (23,497) | (33,198) | (25,026) |
Segment Adjusted EBITDA | 3,495 | 9,383 | (2,490) |
Total assets | 417,038 | 146,601 | 84,445 |
Capital expenditures | 12,891 | 15,196 | 1,493 |
Operating segments | |||
Reportable segment results | |||
Revenues | 2,406,511 | 1,569,976 | 1,328,129 |
Operating segments | Illinois Basin | |||
Reportable segment results | |||
Revenues | 1,296,305 | 919,597 | 769,957 |
Operating segments | Appalachia | |||
Reportable segment results | |||
Revenues | 928,087 | 545,539 | 500,330 |
Operating segments | Oil & Gas Royalties | |||
Reportable segment results | |||
Revenues | 141,441 | 77,185 | 43,141 |
Operating segments | Coal Royalties | |||
Reportable segment results | |||
Revenues | 56 | 69 | 105 |
Operating segments | Other, Corporate and Elimination | |||
Reportable segment results | |||
Revenues | 40,622 | 27,586 | 14,596 |
Elimination | Coal Royalties | |||
Reportable segment results | |||
Revenues | 60,624 | 51,402 | 42,112 |
Elimination | Other, Corporate and Elimination | |||
Reportable segment results | |||
Revenues | $ (60,624) | $ (51,402) | $ (42,112) |
SEGMENT INFORMATION - EBITDA Ex
SEGMENT INFORMATION - EBITDA Expense Reconciliation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Reconciliation of consolidated Segment Adjusted EBITDA Expense | |||
Segment Adjusted EBITDA Expense | $ 1,282,433 | $ 952,649 | $ 861,249 |
Outside coal purchases | 151 | 6,372 | |
Other expense (income) | (4,353) | 3,020 | 1,593 |
Product | |||
Reconciliation of consolidated Segment Adjusted EBITDA Expense | |||
Operating expenses (excluding depreciation, depletion and amortization) | $ 1,286,635 | $ 943,257 | $ 859,656 |
SEGMENT INFORMATION - EBITDA Re
SEGMENT INFORMATION - EBITDA Reconciliation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Reconciliation of consolidated Segment Adjusted EBITDA to net income | |||
Consolidated Segment Adjusted EBITDA | $ 1,020,558 | $ 549,252 | $ 446,489 |
Income tax expense | 53,978 | 417 | 35 |
Interest expense, net | 35,297 | 39,141 | 45,478 |
Goodwill impairment | 0 | 0 | 132,026 |
Asset impairment | 24,977 | ||
Depreciation, depletion and amortization | 273,759 | 261,377 | 313,387 |
General and administrative | 80,334 | 70,160 | 59,806 |
NET INCOME (LOSS) ATTRIBUTABLE TO ARLP | 577,190 | 178,157 | (129,220) |
LESS: NET INCOME ATTRIBUTABLE TO NONCONTROLLING INTEREST | (1,958) | (598) | (169) |
NET INCOME (LOSS) | $ 579,148 | $ 178,755 | $ (129,051) |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) $ in Millions | 12 Months Ended | ||
Feb. 22, 2023 USD ($) a | Dec. 31, 2022 a | Jan. 27, 2023 USD ($) | |
Subsequent Event | |||
Royalty acres, net | a | 61,400 | ||
Subsequent event | |||
Subsequent Event | |||
Funding commitment | $ | $ 35 | ||
Subsequent event | JC Resources | |||
Subsequent Event | |||
Royalty acres, net | a | 2,682 | ||
Payments to acquire royalty interests | $ | $ 72.3 |
SCHEDULE I - CONDENSED FINANCIA
SCHEDULE I - CONDENSED FINANCIAL INFORMATION OF REGISTRANT - BALANCE SHEETS (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
CURRENT ASSETS: | |||
Cash and cash equivalents | $ 296,023 | $ 122,403 | |
Total current assets | 654,791 | 339,228 | |
OTHER ASSETS: | |||
Total other assets | 189,760 | 121,500 | |
TOTAL ASSETS | 2,661,473 | 2,159,406 | $ 2,166,016 |
CURRENT LIABILITIES: | |||
Accrued taxes other than income taxes | 22,967 | 17,787 | |
Total current liabilities | 255,571 | 177,577 | |
Total liabilities | 1,019,995 | 933,337 | |
PARTNERS' CAPITAL: | |||
Limited Partners - Common Unitholders 127,195,219 units outstanding | 1,656,025 | 1,279,183 | |
TOTAL LIABILITIES AND PARTNERS' CAPITAL | 2,661,473 | 2,159,406 | |
AHGP as the parent company | |||
CURRENT ASSETS: | |||
Cash and cash equivalents | 2,174 | 2,173 | |
Total current assets | 2,174 | 2,173 | |
OTHER ASSETS: | |||
Investments in consolidated subsidiaries | 1,653,951 | 1,277,110 | |
Total other assets | 1,653,951 | 1,277,110 | |
TOTAL ASSETS | 1,656,125 | 1,279,283 | |
CURRENT LIABILITIES: | |||
Accrued taxes other than income taxes | 100 | 100 | |
Total current liabilities | 100 | 100 | |
Total liabilities | 100 | 100 | |
PARTNERS' CAPITAL: | |||
Limited Partners - Common Unitholders 127,195,219 units outstanding | 1,656,025 | 1,279,183 | |
TOTAL LIABILITIES AND PARTNERS' CAPITAL | $ 1,656,125 | $ 1,279,283 |
SCHEDULE I - CONDENSED FINANC_2
SCHEDULE I - CONDENSED FINANCIAL INFORMATION OF REGISTRANT - BALANCE SHEETS (Parenthetical) (Details) - shares | Dec. 31, 2022 | Dec. 31, 2021 |
Condensed Financial Statements, Captions [Line Items] | ||
Common units outstanding | 127,195,219 | 127,195,219 |
AHGP as the parent company | ||
Condensed Financial Statements, Captions [Line Items] | ||
Common units outstanding | 127,195,219 | 127,195,219 |
SCHEDULE I - CONDENSED FINANC_3
SCHEDULE I - CONDENSED FINANCIAL INFORMATION OF REGISTRANT - OPERATIONS (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Condensed Financial Statements, Captions [Line Items] | |||
Interest income | $ 2,035 | $ 88 | $ 135 |
NET INCOME (LOSS) ATTRIBUTABLE TO ARLP | $ 577,190 | $ 178,157 | $ (129,220) |
EARNINGS PER LIMITED PARTNER UNIT - BASIC (in dollars per unit) | $ 4.39 | $ 1.36 | $ (1.02) |
EARNINGS PER LIMITED PARTNER UNIT - DILUTED (in dollars per unit) | $ 4.39 | $ 1.36 | $ (1.02) |
WEIGHTED-AVERAGE NUMBER OF UNITS OUTSTANDING - BASIC (in units) | 127,195,219 | 127,195,219 | 127,164,659 |
WEIGHTED-AVERAGE NUMBER OF UNITS OUTSTANDING - DILUTED (in units) | 127,195,000 | 127,195,000 | 127,165,000 |
AHGP as the parent company | |||
Condensed Financial Statements, Captions [Line Items] | |||
Interest income | $ 24 | ||
Equity in earnings of consolidated subsidiaries | $ 577,190 | $ 178,157 | (129,244) |
NET INCOME (LOSS) ATTRIBUTABLE TO ARLP | $ 577,190 | $ 178,157 | $ (129,220) |
EARNINGS PER LIMITED PARTNER UNIT - BASIC (in dollars per unit) | $ 4.39 | $ 1.36 | $ (1.02) |
EARNINGS PER LIMITED PARTNER UNIT - DILUTED (in dollars per unit) | $ 4.39 | $ 1.36 | $ (1.02) |
WEIGHTED-AVERAGE NUMBER OF UNITS OUTSTANDING - BASIC (in units) | 127,195,219 | 127,195,219 | 127,164,659 |
WEIGHTED-AVERAGE NUMBER OF UNITS OUTSTANDING - DILUTED (in units) | 127,195,219 | 127,195,219 | 127,164,659 |
SCHEDULE I - CONDENSED FINANC_4
SCHEDULE I - CONDENSED FINANCIAL INFORMATION OF REGISTRANT - CASH FLOWS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | |||
CASH FLOWS FROM OPERATING ACTIVITIES | $ 791,812 | $ 425,202 | $ 400,645 |
CASH FLOWS FROM FINANCING ACTIVITIES: | |||
Distributions paid to Partners | (196,347) | (52,158) | (51,753) |
Net cash used in financing activities | (214,854) | (215,685) | (256,429) |
NET CHANGE IN CASH AND CASH EQUIVALENTS | 173,620 | 66,829 | 19,092 |
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD | 122,403 | 55,574 | 36,482 |
CASH AND CASH EQUIVALENTS AT END OF PERIOD | 296,023 | 122,403 | 55,574 |
AHGP as the parent company | |||
CASH FLOWS FROM OPERATING ACTIVITIES: | |||
CASH FLOWS FROM OPERATING ACTIVITIES | 196,348 | 52,157 | 51,751 |
CASH FLOWS FROM FINANCING ACTIVITIES: | |||
Distributions paid to Partners | (196,347) | (52,158) | (51,753) |
Net cash used in financing activities | (196,347) | (52,158) | (51,753) |
NET CHANGE IN CASH AND CASH EQUIVALENTS | 1 | (1) | (2) |
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD | 2,173 | 2,174 | 2,176 |
CASH AND CASH EQUIVALENTS AT END OF PERIOD | $ 2,174 | $ 2,173 | $ 2,174 |
SCHEDULE I - CONDENSED FINANC_5
SCHEDULE I - CONDENSED FINANCIAL INFORMATION OF REGISTRANT - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Condensed Financial Statements, Captions [Line Items] | |||
Maximum undiscounted future payment obligation | $ 425.6 | ||
AHGP as the parent company | |||
Condensed Financial Statements, Captions [Line Items] | |||
Cash contribution by affiliated entity | $ 196.3 | $ 52.2 | $ 51.8 |