What changed in this filing

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Item 2. Properties

2023-02-23 compared with 2022-03-07 · 45 added, 18 removed, 105 unchanged (38% of the section changed)

13 unchanged sentences

We provide Marshall Miller with historical property information including property maps, deed, lease, and permit information, drilling and lab results, mine plans, production quantities, development, capital, and operating costs as well as market information.

For each of our active and development mining properties, Marshall Miller performs an initial assessment and based on the level of geological evidence estimates our coal resources and classifies such resources as either inferred, indicated or measured.

For each of our active and material mining properties, Marshall Miller further conducts a pre-feasibility study to estimate our coal reserves and classify such reserves as either proven or probable.

The estimates and reports prepared by Marshall Miller are reviewed by our personnel to ensure such reports have been prepared in accordance with applicable rules and regulations and that estimates are based on reasonable assumptions and reflect known facts and circumstances updated through year-end.

Economic analysis is a required part of the process to estimate coal reserves and resources.

For our active and certain idled Met mining properties, Marshall Miller performs an initial assessment and based on the level of geological evidence estimates our coal resources and classifies such resources as either inferred, indicated or measured.

When considered cost beneficial by the Company, Marshall Miller further conducts a pre-feasibility study to estimate our coal reserves and classify such reserves as either proven or probable.

The estimates and reports prepared by Marshall Miller are reviewed by our personnel to ensure such reports have been prepared in accordance

with applicable rules and regulations and that estimates are based on reasonable assumptions and reflect known facts and circumstances updated through year-end.

Economic analysis is a required part of the process of estimating coal reserves and resources.

For a coal reserve or resource to be considered economic, generally revenue generated from its sale must exceed its total cost of production (including consideration of development, capital, and operating costs).

14 unchanged sentences

McClure/Toms Creek VA 72,094 49,271 22,823 — 72,094 41,591 30,503

Elk Run WV 41,442 20,929 20,513 139 41,303 12,111 29,331

Total 336,706 194,153 142,553 8,583 328,123 166,438 170,268

9 unchanged sentences

McClure/Toms Creek VA 7,272 — 63,052 — 1,770 72,094 — 31 %

Elk Run WV 29,895 11,547 — — — 33,115 8,327 22 %

Total 123,934 51,661 73,141 73,929 14,041 292,955 43,751

(1) Kingston thermal reserves primarily proven and >1% sulfur;

Marfork thermal reserves primarily probable and >1% sulfur;

McClure/Toms Creek thermal reserves primarily probable and <1% sulfur.

Marfork and McClure/Toms Creek thermal reserves primarily probable and <1% sulfur.

(2) Recovery percentage defined as estimated coal reserves divided by related estimated in situ measured and indicated coal resources.

3 unchanged sentences

McClure/Toms Creek $177

Power Mountain $140

(1) Market pricing shown on U.S.

11 unchanged sentences

McClure/Toms Creek VA 43,044 12,706 30,338 — 43,044 20,486 22,558

Power Mountain WV 57,777 24,617 33,160 18,308 39,469 7,761 50,016

Elk Run WV 67,883 22,360 45,523 — 67,883 8,503 59,380

Total 527,333 209,577 317,756 139,750 387,583 83,150 444,183

10 unchanged sentences

McClure/Toms Creek VA 299 — 42,745 — — 23,139 19,905 25 %

Power Mountain WV — 57,777 — — — 7,760 50,017 29 %

Elk Run WV 14,204 53,679 — — — — 67,883 28 %

Total 119,573 255,271 54,681 91,291 6,517 201,779 325,554

(1) Amounts shown exclusive of coal reserves.

(2) Expected recovery percentage defined as potential estimated recoverable tons included in the initial assessment divided by estimated in situ measured and indicated coal resources.

(2) Expected recovery percentage defined as potential estimated recoverable tons divided by estimated in situ measured and indicated coal resources.

Our coal reserves and resources are owned or are controlled through leases with third parties, which have varied expiration dates and either have options to renew or are expected to be renewed until all mineable and merchantable coal is exhausted.

2 unchanged sentences

Currently, there are no known permitting issues that would impact the reporting of our coal reserves or resources.

However, also refer to

However, also refer to “Item 1.

Business—Environmental and Other Regulatory Matters” and “Item 1A.

6 unchanged sentences

12/31/2021 12/31/2022

Mining Complex Coal Reserves Acquired/Leased Disposed Production Initial Assessment (1)

Mining Complex Coal Reserves Acquired/Leased Production Pre-Feasibility (1)

Change in Mine Plan Other (2)

5 unchanged sentences

McClure/Toms Creek 80,077 — (3,538) — (4,445) — 72,094

Other 88,541 — — (842) — — (87,699) —

Other 4,444 — — (1,178) — — (3,266) —

Elk Run — — — — — 41,442 41,442

Total 351,099 2,436 (14,198) 8,106 (10,737) — 336,706

(1) Mineral areas subjected to initial assessment only and reported as coal resources.

(2) In adopting the SEC’s new subpart 1300 of Regulation S-K, the Company focused efforts on material and active mining properties and concluded that, for certain inactive and/or immaterial mining properties, preparing reserve/resource reports was not cost beneficial.

Additional reserve/resource reports may be prepared in the future if such properties become active and/or material.

(1) Mineral areas initially subjected to Pre-feasibility study in current period.

(2) Mineral reclassified based on change in expected processing location.

The Company plans to develop a new underground mine and re-start its idled Elk Run processing plant (acquired in 2018) in 2024.

Coal is expected to be processed at the Elk Run plant and loaded on the CSX rail for delivery to customers.

Changes in Coal Resources (Tons in thousands)

12/31/2021 12/31/2022

Mining Complex Coal Resources S-K Rule

Mining Complex Coal Resources Initial Assessment (1)

Change in Mine Plan Other (2)

Coal Resources

4 unchanged sentences

McClure/Toms Creek 32,281 — 10,763 — 43,044

Power Mountain — 57,777 — — 57,777

Elk Run — — — 67,883 67,883

Total 381,712 155,347 (9,726) — 527,333

(1) Adoption of new SEC subpart 1300 of Regulation S-K required the Company to disclose coal resources beginning with the year ending December 31, 2021.

As coal reserve and resource amounts represent estimates, also refer to “Estimates of our economically recoverable coal reserves and coal resources involve uncertainties, and inaccuracies in our estimates could result in lower than expected revenues, higher than anticipated costs, decreased profitability and asset impairments” contained in “Item 1A.

Risk Factors.”

(1) Mineral areas subjected to initial assessment in current year.

(2) Mineral reclassified based on change in expected processing location.

The Company plans to develop a new underground mine and re-start its idled Elk Run processing plant (acquired in 2018) in 2024.

Coal is expected to be processed at the Elk Run plant and loaded on the CSX rail for delivery to customers.

Internal Controls Disclosure

The preparation of coal reserve and resource estimates is conducted in accordance with the Company’s prescribed internal control procedures, which are designed to ensure the reliability of such estimates.

On an annual basis, Company personnel meet with the independent qualified person to provide updates to the data and assumptions to be used in performing the reserve and resource estimates.

Company personnel review the work of the qualified person to ensure such work is prepared in accordance with applicable rules and regulations and that the data and assumptions used are supportable based on historical results and current and future mine plans and reflect known facts and circumstances through the reporting date.

For example, the Company’s land personnel verify the property maps and control areas used by the qualified person based on review of underlying deed and lease records.

The Company’s engineering personnel ensure estimates are based on current mine plans, incorporate the most recent drilling and lab data, properly reflect changes in permitting status, consider known encumbrances, and are consistent with operating knowledge and expectations in terms of mining methods, recovery rates, minimum seam heights or maximum strip ratios, and saleable qualities.

The Company’s operations support personnel endeavor to ensure that estimates are prepared in accordance with applicable rules and regulations, that rationale for changes in estimates from prior years are reasonable and supportable, and that cash flow projections are based on reasonable and supportable assumptions with respect to forecasted production rates, coal pricing, and operating and capital costs.

The Company’s drilling, sample preparation and laboratory analysis are conducted in accordance with internal policies and procedures.

For example, core drilling is conducted by reputable third-party drillers and core samples are tagged.

Laboratory testing is performed by American National Standards Institute (“ANSI”) certified laboratories and samples are analyzed in accordance with procedures defined under American Society for Testing and Materials (“ASTM”) standards.

Core drilling and laboratory testing results are logged into a database with restricted access.

In addition, the Company’s qualified person performs independent data verification procedures to ensure data is of sufficient quantity and reliability to reasonably support the coal reserve and resource estimates.

Coal reserve and resource amounts are estimates and as estimates have inherent risks due to data accuracy, uncertainty from geologic interpretation, mine plan assumptions, uncontrolled property rights and permit availability, uncertainty with respect to future market supply and demand, and changes in laws and regulations.

The Company’s current coal reserves and resource estimates are based on the best information available and are subject to re-assessment when conditions change.

Also refer to Item 1A.

Risk Factors for further discussion of risks associated with the estimates of the Company’s reserves and resources.

The following map shows the locations of our material mining properties and corporate headquarters:

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 2. Properties