5 unchanged sentences
● Ownership of limited partner interests could be diluted
−Removed: ● Sales of our common units could cause decline of the market price of our common units
−Removed: ● Increase in interest rates could cause decline of the market price of our common units
+Added: ● Sales of our common units could cause decline in the market price of our common units
+Added: ● Increase in interest rates could cause decline in the market price of our common units
● The credit risk of our general partner could adversely impact us
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● Fluctuations in transportation costs and availability could reduce demand for our products
−Removed: ● Unavailability of economic coal reserves could limit our ability to continue or expand our operations
−Removed: ● Estimates of our coal reserves could be inaccurate and could result in decreased profitability
+Added: ● Unexpected increases in raw material costs could impact the profitability of our operations
+Added: ● The ability to recruit, hire and retain skilled labor could impact the profitability of our operations
+Added: ● Disruptions in supply chains could impact the profitability of our operations
+Added: ● Inflationary pressures could impact the profitability of our operations
+Added: ● Unavailability of economic coal mineral reserves and resources could limit our ability to continue or expand our operations
+Added: ● Estimates of our coal mineral reserves and resources could be inaccurate and could result in decreased profitability
● Coal mining in certain areas could be difficult and involve regulatory constraints which could impact our operations
1 unchanged sentence
● Legislative and regulatory compliance is costly
−Removed: ● Legislative and regulatory compliance could impact our minerals segment
+Added: ● Legislative and regulatory compliance could impact our business
● Legislative and regulatory initiatives relating to hydraulic fracturing could impact our mineral interests
−Removed: ● Legislative and regulatory initiatives relating to address seismic activity could impact our minerals segment
+Added: ● Legislative and regulatory initiatives relating to seismic activity could impact our business
● Legislative and regulatory initiatives relating to climate change could impact demand for our products
● Mine facilities located in a leased portion of the surface properties which introduces a risk of disruption to our operations
−Removed: ● Unexpected increases in raw material costs could impact the profitability of our operations
● Inability to acquire or failure to maintain surety bonds could limit our ability to continue or expand our operations
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● A lack of control over the timing of future drilling with respect to our mineral interests limits our ability to control the timing and quantity of production
−Removed: ● Delays in royalty payments and optional royalty payments could impact our minerals segment
−Removed: ● Suspension of right to receive royalty payments could impact our minerals segment
+Added: ● Delays in royalty payments and optional royalty payments could impact our business
+Added: ● Suspension of right to receive royalty payments could impact our business
● Estimates of our oil & gas reserves could be inaccurate and could result in decreased profitability
−Removed: ● Uncertainties involved in drilling for and producing oil & gas could impact our minerals segment
−Removed: ● Availability of transportation and facilities for the products could impact our minerals segment
+Added: ● Uncertainties involved in drilling for and producing oil & gas could impact our business
+Added: ● Availability of transportation and facilities for the products could impact our business
● Lack of hedging arrangements exposes us to the impact of commodity prices
3 unchanged sentences
Tax Risks to Our Common Unitholders
−Removed: ● Our tax treatment depends on our status as a partnership for federal income tax purposes, and not being subject to a material amount of entity-level taxation.
+Added: ● Our tax treatment depends on our status as a partnership for U.S.
+Added: federal income tax purposes, and not being subject to a material amount of entity-level taxation.
Our cash available for distribution to unitholders may be substantially reduced if we become subject to entity-level taxation as a result of the Internal Revenue Service ("IRS") treating us as a corporation or legislative, judicial, or administrative changes, and may also be reduced by any audit adjustments if imposed directly on the Partnership.
3 unchanged sentences
● Limitation on unitholders ability to deduct interest expense incurred by us could create tax liabilities for our unitholders
−Removed: ● Tax Exempt entities and non-United States unitholders face unique tax issues from owning our common units that may result in adverse tax consequences to them
+Added: ● Tax Exempt entities and non-U.S.
+Added: unitholders face unique tax issues from owning our common units that may result in adverse tax consequences to them
● IRS challenging our allocation of depreciation and amortization deductions could cause adverse tax consequences
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Cash distributions to unitholders are not guaranteed.
−Removed: Our Board of Directors suspended cash distributions to unitholders beginning with the quarter ended March 31, 2020.
−Removed: The payment and amount of any future distribution will be subject to the sole discretion of our Board of Directors and will
−Removed: depend upon many factors, including our financial condition and prospects, our capital requirements and access to financing, covenants associated with our debt obligations, and other factors that our Board of Directors may deem relevant, and there can be no assurance that we will pay a distribution in the future.
+Added: The board of directors of our managing general partner ("Board of Directors") suspended cash distributions to unitholders beginning with the quarter ended March 31, 2020 due to uncertainty in the global economy caused by the COVID-19 pandemic, and resumed cash distributions following the quarter ended March 31, 2021.
+Added: The payment and amount of any future distribution will be subject to the sole discretion of our Board of Directors and will depend upon many factors, including our financial condition and prospects, our capital requirements and access to financing, covenants associated with our debt obligations, and other factors that our Board of Directors may deem relevant, and there can be no assurance that we will pay a distribution in the future.
The amount of cash we can distribute to holders of our common units or other partnership securities each quarter principally depends on the amount of cash we generate from our operations, which fluctuates from quarter to quarter based on, among other things:
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Before making any distributions to our unitholders, we will reimburse our general partner and its affiliates for all expenses they have incurred on our behalf.
−Removed: The reimbursement of these expenses and the payment of these fees could
−Removed: adversely affect our ability to make distributions to the unitholders.
+Added: The reimbursement of these expenses and the payment of these fees could adversely affect our ability to make distributions to the unitholders.
Our general partner has sole discretion to determine the amount of these expenses and fees.
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Our general partner's discretion in determining the level of cash reserves may adversely affect our ability to make cash distributions to our unitholders.
−Removed: Our partnership agreement requires our general partner to deduct from available cash reserves that in its reasonable discretion are necessary for the proper conduct of our business, to comply with applicable law or agreements to which we are a party, or to provide funds for future distributions to partners.
+Added: Our partnership agreement requires our general partner to deduct from available cash reserves that in its reasonable discretion are necessary for the proper conduct of our business, to comply with applicable law or agreements to which we
+Added: are a party, or to provide funds for future distributions to partners.
These cash reserves will affect the amount of cash available for distribution to unitholders.
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Some of our executive officers and directors face potential conflicts of interest in managing our business.
−Removed: Certain of our executive officers and directors are also officers and/or directors of AGP.
+Added: Certain of our executive officers and directors are also officers and/or directors of Alliance GP, LLC ("AGP").
These relationships could create conflicts of interest regarding corporate opportunities and other matters.
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Companies that do not adapt or comply with evolving investor or stakeholder expectations and standards, or are perceived to have not responded appropriately to ESG issues, regardless of any legal requirement to do so, may suffer reputational damage and the business, financial condition, and/ unit price of such companies could be materially and adversely affected.
−Removed: A number of advocacy groups, both domestically and internationally, have campaigned for governmental and private action to promote change at public companies related to ESG matters, including through the investment and voting practices of investment advisers, public pension funds, universities and other members of the investing community.
+Added: Several advocacy groups, both domestically and internationally, have campaigned for governmental and private action to promote change at public companies related to ESG matters, including through the investment and voting practices of investment advisers, public pension funds, universities, and other members of the investing community.
These activities include increasing attention to and demands for action related to climate change, promoting the use of substitutes to fossil-fuel products, encouraging the divestment of fossil-fuel equities, and pressuring lenders to limit funding to companies engaged in the extraction of fossil-fuel reserves.
−Removed: These activities could increase costs, reduce demand for our coal and hydrocarbon products, reduce our profits, increase the potential for investigations and litigation, limit our choices for lenders, insurance providers and business partners, impair our brand and have negative impacts on our unit price and access to capital markets.
+Added: These activities could increase costs, reduce demand for our coal and hydrocarbon products, reduce our profits, increase the potential for investigations and litigation, impair our brand, limit our choices for lenders, insurance providers and business partners, and have negative impacts on our unit price and access to capital markets.
In addition, certain organizations that provide corporate governance and other corporate risk information to investors and unitholders have developed scores and ratings to evaluate companies and investment funds based upon ESG or "sustainability"
−Removed: Currently, there are no universal standards for such scores or ratings, but consideration of sustainability evaluations is becoming more broadly accepted by investors.
+Added: Currently, there are no universal standards for such scores or ratings, but consideration of
+Added: sustainability evaluations is becoming more broadly accepted by investors.
Indeed, many investment funds focus on positive ESG business practices and sustainability scores when making investments, whereas other funds may use certain ESG criteria to "screen"
certain sectors, such as coal or fossil fuels more generally, out of their investments.
−Removed: In addition, investors, particularly institutional investors, use these scores to benchmark companies against their peers and if a company
−Removed: is perceived as lagging, these investors may engage with companies to require improved ESG disclosure or performance or sell their interests in the company, particularly if its ESG performance does not improve.
−Removed: Moreover, certain members of the broader investment community may consider a company's sustainability score as a reputational or other factor in making an investment decision.
+Added: In addition, investors, particularly institutional investors, use these scores to benchmark companies against their peers and if a company is perceived as lagging, these investors may engage with companies to require improved ESG disclosure or performance or sell their interests in the company, particularly if its ESG performance does not improve.
+Added: Moreover, certain members of the broader investment community may consider a company's sustainability score as a reputational or other factors in making an investment decision.
Companies in the energy industry, and in particular those focused on coal, natural gas, or oil extraction, often do not score as well under ESG assessments compared to companies in other industries.
Consequently, a low ESG or sustainability score could result in our securities, both debt and equity, being excluded from the portfolios of certain investment funds and investors, restricting our access to capital to fund our continuing operations and growth opportunities.
+Added: Additionally, to the extent ESG matters negatively impact our reputation, we may not be able to compete as effectively to recruit or retain employees, which may adversely affect our operations.
Risks Related to our Business
3 unchanged sentences
● any inability of our customers to raise capital could adversely affect their ability to honor their obligations to us;
−Removed: ● our future ability to access the capital markets could be restricted as a result of future economic conditions, which could materially impact our ability to grow our business, including the development of our coal reserves.
+Added: ● our future ability to access the capital markets could be restricted as a result of future economic conditions, which could materially impact our ability to grow our business, including the development of our coal mineral reserves and resources.
We face various risks related to pandemics and similar outbreaks, which have had and may continue to have material adverse effects on our business, financial position, results of operations, and/or cash flows.
3 unchanged sentences
The COVID-19 pandemic and related economic repercussions have created significant volatility, uncertainty, and turmoil in the coal and oil & gas industries.
−Removed: The COVID-19 outbreak and the responsive actions to limit the spread of the virus have significantly reduced global economic activity, resulting in a decline in the demand for coal, oil, natural gas and other commodities, and negatively impacted our results of operations for 2020.
+Added: The COVID-19 outbreak and the responsive actions to limit the spread of the virus have significantly reduced global economic activity, resulting in a decline in the demand for coal, oil, natural gas, and other commodities.
Our operations could be further impacted by the COVID-19 pandemic if significant portions of our workforce are unable to work effectively, including because of illness, quarantines, or absenteeism;
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The continued spread of COVID-19 could also affect our ability to hire, develop and retain our talented and diverse workforce, and to maintain our corporate culture.
+Added: The impact of a government-enforced vaccine mandate may result in adverse impacts such as workforce attrition for us or reduced morale or efficiency.
The continued global pandemic, including the economic impact, is likely also to cause further disruption in our supply chain.
−Removed: If our suppliers have increased challenges with their workforce (including as a result of illness, absenteeism or government orders), facility closures, access to necessary components and supplies, access to capital, and access to fundamental support services (such as shipping and transportation), they could be unable to provide the agreed-upon goods and services in a timely, compliant and cost-effective manner.
+Added: If our suppliers have increased challenges with their workforce (including as a result of illness, absenteeism, or government orders), facility closures, access to necessary
+Added: components and supplies, access to capital, and access to fundamental support services (such as shipping and transportation), they could be unable to provide the agreed-upon goods and services in a timely, compliant and cost-effective manner.
We could incur additional costs and delays in our business, including as a result of higher prices for materials and equipment and schedule delays.
As a result of the COVID-19 crisis, there may be changes in our customers' priorities and practices, as our customers in both the United States and globally confront reduced demand.
−Removed: Our customers have and may continue to experience adverse effects as a result of the COVID-19 crisis which could impact their credit-worthiness or their ability to make payment for our products.
−Removed: We continue to work with our stakeholders
−Removed: (including customers, employees, suppliers, and local communities) to address this global pandemic responsibly.
−Removed: We continue to monitor the situation, to assess further possible implications to our employees, business, supply chain, and customers, and to take certain actions to mitigate various adverse consequences.
+Added: Our customers have and may continue to experience adverse effects as a result of the COVID-19 crisis which could impact their creditworthiness or their ability to make payment for our products.
+Added: We continue to work with our stakeholders (including customers, employees, suppliers, and local communities) to address this global pandemic responsibly.
+Added: We continue to monitor the situation, assess further possible implications to our employees, business, supply chain, and customers, and take certain actions to mitigate various adverse consequences.
We expect that the longer the COVID-19 pandemic, including its economic disruption, continues, the greater the adverse impact on our business operations, financial performance, and results of operations could be.
−Removed: Given the tremendous uncertainties and variables, we cannot at this time predict the impact of the global COVID-19 pandemic, or any future pandemic, but any pandemic or similar outbreak could have a material adverse impact on our business, financial position, results of operations, and/or cash flows.
+Added: The ultimate impact of COVID-19 on our operational and financial performance in future periods remains uncertain and will depend on future pandemic-related developments, including the duration of the pandemic, potential subsequent waves of COVID-19 infection or potential new variants, the effectiveness and adoption of COVID-19 vaccines and therapeutics, supplier impacts and related government actions to prevent and manage disease spread, including the implementation of any federal, state, local or foreign vaccine mandates, all of which are uncertain and cannot be predicted.
Growing our business could require significant amounts of financing that may not be available to us on acceptable terms, or at all.
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Accordingly, long-term sales contracts may provide only limited protection during adverse market conditions.
−Removed: In some circumstances, failure of the parties to agree on a price under a reopener provision can also lead to the early termination of a contract.
+Added: In some circumstances, the failure of the parties to agree on a price under a reopener provision can also lead to the early termination of a contract.
Several of our long-term sales contracts also contain provisions that allow the customer to suspend or terminate performance under the contract upon the occurrence or continuation of certain events that are beyond the customer's reasonable control.
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We depend on a few customers for a significant portion of our revenues, and the loss of one or more significant customers could affect our ability to maintain the sales volume and price of the coal we produce.
−Removed: In 2020, we derived more than 10% of our total revenues from each of three customers, American Electric Power, Louisville Gas and Electric Company, and Tennessee Valley Authority.
−Removed: If we were to lose these or any of our significant customers without finding replacement customers willing to purchase an equivalent amount of coal on similar terms, or if these customers were to decrease the amounts of coal purchased or change the terms, including pricing terms, on which they buy coal from us, it could have a material adverse effect on our business, financial condition, and results of operations.
+Added: In 2021, we derived more than 10% of our total revenues from Louisville Gas and Electric Company.
+Added: If we were to lose this or any of our significant customers without finding replacement customers willing to purchase an equivalent amount of coal on similar terms, or if these customers were to decrease the amounts of coal purchased or change the terms, including pricing terms, on which they buy coal from us, it could have a material adverse effect on our business, financial condition, and results of operations.
Our ability to collect payments from our customers could be impaired if their creditworthiness declines or if they fail to honor their contracts with us.
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Terrorist attacks or cyber incidents could result in information theft, data corruption, operational disruption, and/or financial loss.
−Removed: Like most companies, we have become increasingly dependent upon digital technologies, including information systems, infrastructure, and cloud applications and services, to operate our businesses, to process and record financial and operating data, communicate with our business partners, analyze mine and mining information, estimate quantities of reserves, as well as other activities related to our businesses.
+Added: Like most companies, we have become increasingly dependent upon digital technologies, including information systems, infrastructure, and cloud applications and services, to operate our businesses, to process and record financial and operating data, communicate with our business partners, analyze mine and mining information, estimate quantities of reserves and resources, as well as other activities related to our businesses.
Strategic targets, such as energy-related assets, could be at greater risk of future terrorist or cyber-attacks than other targets in the United States.
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● weather conditions and patterns that affect demand for coal and oil & gas, or our ability to produce coal or the ability of operators to produce oil & gas from our mineral interests;
+Added: ● supply chain and cost of raw materials for coal and oil & gas operations;
● the proximity to and capacity of transportation facilities;
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Consequently, currency fluctuations could adversely affect the competitiveness of our coal in international markets, which could have a material adverse effect on our business, financial condition, results of operations, and cash flows.
−Removed: Changes in taxes or tariffs and other trade measures could adversely affect our results of operations, financial position, and cash flows.
−Removed: Certain taxes and fees related to our operations, including the Abandoned Mine Land Reclamation Fund and the Black Lung Excise Tax, are set to expire in 2021.
−Removed: While the renewal of these taxes and fees would not have a significant impact on our business or results of operations, Congress may seek to increase these taxes and fees that relate specifically to the coal industry.
+Added: Changes in taxes or tariffs and other trade measures by the United States and foreign governments could adversely affect our results of operations, financial position, and cash flows.
+Added: We pay certain taxes and fees related to our operations.
+Added: Congress or state legislatures may seek to increase these taxes and fees that relate specifically to the coal industry.
We cannot predict further developments, and such increases could have a material adverse effect on our results of operations, financial position, and cash flows.
1 unchanged sentence
In response to tariffs imposed by the United States, the European Union, Canada, Mexico, and China have imposed tariffs on United States goods and services.
−Removed: The new tariffs, along with any additional tariffs or trade restrictions that may be implemented by the United States or retaliatory trade measures or tariffs implemented by other countries, could result in reduced economic activity, increased costs in operating our business, reduced demand and changes in purchasing behaviors for thermal and metallurgical coal, limits on trade with the United States or other potentially adverse economic
+Added: The new tariffs, along with any additional tariffs or trade restrictions that may be implemented by the United States or retaliatory trade measures or tariffs implemented by other countries, could result in reduced economic activity, increased costs in operating our business, reduced demand and changes in purchasing behaviors for thermal and metallurgical coal, limits on trade with the United States or other potentially adverse economic outcomes.
Additionally, we sell coal into the export thermal and metallurgical markets.
1 unchanged sentence
While tariffs and other retaliatory trade measures imposed by other countries on United States goods have not yet had a significant impact on our business or results of operations, we cannot predict further developments, and such existing or future tariffs could have a material adverse effect on our results of operations, financial position and cash flows and could reduce our revenues and cash available for distribution.
−Removed: Changes in consumption patterns by utilities regarding the use of coal have affected our ability to sell the coal we produce.
+Added: Changes in consumption patterns by utilities regarding the use of coal have affected our ability to sell the coal we produce and may do so in the future.
Our business is closely linked to the demand for electricity, and any changes in coal consumption by United States or international electric power generators would likely impact our business over the long term.
−Removed: The domestic electric utility industry accounts for approximately 91% of domestic coal consumption.
+Added: The domestic electric power sector accounts for the vast majority of the total domestic coal consumption.
The amount of coal consumed by the domestic electric utility industry is affected primarily by the overall demand for electricity, environmental and other governmental regulations, and the price and availability of competing fuels for power plants such as nuclear, natural gas, and fuel oil as well as alternative sources of energy.
5 unchanged sentences
Other factors, such as efficiency improvements associated with technologies powered by electricity have slowed electricity demand growth and could contribute to slower growth in the future.
−Removed: Further decreases in the demand for electricity, such as decreases that could be caused by a worsening of current economic conditions, a prolonged economic recession, or prolonged recovery from the COVID-19 pandemic, could have a material adverse effect on the demand for coal and our business over the long term.
+Added: Further decreases in the demand for electricity, such as decreases that could be caused by a worsening of current economic conditions, could have a material adverse effect on the demand for coal and our business over the long term.
We, our customers, or the operators of our oil & gas mineral interests could be subject to litigation related to climate change .
2 unchanged sentences
The plaintiffs in these suits sought various remedies, including punitive and compensatory damages and injunctive relief.
−Removed: While the United States Supreme Court held that federal common law provided no basis for public nuisance claims against the defendants in those cases, tort-type liabilities remain a possibility and a source of concern.
+Added: While the U.S.
+Added: Supreme Court held that federal common law provided no basis for public nuisance claims against the defendants in those cases, tort-type liabilities remain a possibility and a source of concern.
Government entities in other states (including California and New York) have brought similar claims seeking to hold a wide variety of companies that produce fossil fuels liable for the alleged impacts of the GHG emissions attributable to those fuels.
−Removed: Those lawsuits allege damages as a result of climate change and the plaintiffs are seeking unspecified damages and abatement under various tort theories.
+Added: Those lawsuits allege damages as a
+Added: result of climate change and the plaintiffs are seeking unspecified damages and abatement under various tort theories.
Separately, litigation has been brought against certain fossil-fuel companies alleging that they have been aware of the adverse effects of climate change for some time but failed to adequately disclose such impacts to their investors or consumers.
2 unchanged sentences
From time to time, we have disputes with our customers over the provisions of coal supply contracts relating to, among other things, coal pricing, quality, quantity, and the existence of specified conditions beyond our or our customers' control that suspend performance obligations under the particular contract.
−Removed: Disputes could occur in the future and we may not be
−Removed: able to resolve those disputes in a satisfactory manner, which could have a material adverse effect on our business, financial condition, and results of operations.
+Added: Disputes could occur in the future and we may not be able to resolve those disputes in a satisfactory manner, which could have a material adverse effect on our business, financial condition, and results of operations.
See "Item 3.
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Prolonged disruption of production at any of our mines would result in a decrease in our revenues and profitability, which could materially adversely impact our quarterly or annual results.
−Removed: Effective October 1, 2020, we renewed our annual property and casualty insurance program.
+Added: Effective December 1, 2021, we renewed our annual property and casualty insurance program.
Our property insurance was procured from our wholly owned captive insurance company, Wildcat Insurance, LLC ("Wildcat Insurance").
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Accordingly, permits required to conduct our operations may not be issued, maintained, or renewed, or may not be issued or renewed in a timely fashion, or may involve requirements that restrict our ability to economically conduct our mining operations.
−Removed: Limitations on our ability to conduct our mining operations due to the inability to obtain or renew necessary permits or similar approvals could reduce our production, cash flow, and
−Removed: profitability.
+Added: Limitations on our ability to conduct our mining operations due to the inability to obtain or renew necessary permits or similar approvals could reduce our production, cash flow, and profitability.
Please read "Item 1.
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An increase in transportation costs could have an adverse effect on our ability to increase or maintain production and could adversely affect revenues.
−Removed: The unavailability of an adequate supply of coal reserves that can be mined at competitive costs could cause our profitability to decline.
−Removed: Our profitability depends substantially on our ability to mine coal reserves that have the geological characteristics that enable them to be mined at competitive costs and to meet the quality needed by our customers.
−Removed: Because we deplete our reserves as we mine coal, our future success and growth depend, in part, upon our ability to acquire additional coal reserves that are economically recoverable.
−Removed: Replacement reserves may not be available when required or, if available, may not be mineable at costs comparable to those of the depleting mines.
−Removed: We may not be able to accurately assess the geological characteristics of any reserves that we acquire, which could adversely affect our profitability and financial condition.
−Removed: Exhaustion of reserves at particular mines also could have an adverse effect on our operating results that is disproportionate to the percentage of overall production represented by such mines.
−Removed: Our ability to obtain other reserves in the future could be limited by restrictions under our existing or future debt agreements, competition from other coal companies for
−Removed: attractive properties, the lack of suitable acquisition candidates, or the inability to acquire coal properties on commercially reasonable terms.
−Removed: The estimates of our coal reserves could prove inaccurate and could result in decreased profitability.
−Removed: The estimates of our coal reserves could vary substantially from the actual amounts of coal we are able to economically recover.
−Removed: The reserve data set forth in "Item 2.
−Removed: Properties—Coal Reserves"
−Removed: represent our engineering estimates.
−Removed: All of the reserves presented in this Annual Report on Form 10-K constitute proven and probable reserves.
−Removed: There are numerous uncertainties inherent in estimating quantities of reserves, including many factors beyond our control.
−Removed: Estimates of coal reserves necessarily depend upon a number of variables and assumptions, any one of which could vary considerably from actual results.
+Added: Political or financial instability, currency fluctuations, the outbreak of pandemics or other illnesses (such as the COVID-19 pandemic), labor unrest, transport capacity and costs, port security, weather conditions, natural disasters, or other events that could alter or suspend our operations, slow or disrupt port activities, or affect foreign trade are beyond our control and could materially disrupt our ability to participate in the export market for coal sales, which could adversely affect our sales and our results of operations.
+Added: Unexpected increases in raw material costs could significantly impair our operating profitability.
+Added: Our coal mining operations are affected by commodity prices.
+Added: We use significant amounts of steel, petroleum products, and other raw materials in various pieces of mining equipment, supplies, and materials, including the roof bolts required by the room-and-pillar method of mining.
+Added: Steel prices and the prices of scrap steel, natural gas, and coking coal consumed in the production of iron and steel fluctuate significantly and could change unexpectedly.
+Added: Inflationary pressures have and could continue to lead to price increases affecting many of the components of our operating expenses such as fuel, steel, and maintenance expense.
+Added: There could be acts of nature or terrorist attacks or threats that could also impact the future costs of raw materials.
+Added: Future volatility in the price of steel, petroleum products, or other raw materials will impact our operational expenses and could result in significant fluctuations in our profitability.
+Added: A shortage of skilled labor may make it difficult for us to maintain labor productivity and competitive costs and could adversely affect our profitability.
+Added: Efficient coal mining using modern techniques and equipment requires skilled laborers, preferably with at least one year of experience and proficiency in multiple mining tasks.
+Added: In recent years, a shortage of experienced coal miners has caused us to include some inexperienced staff in the operation of certain mining units, which decreases our productivity and increases our costs.
+Added: This shortage of experienced coal miners is the result of a significant percentage of experienced coal miners reaching retirement age, combined with the difficulty of retaining existing workers in and attracting new workers to the coal industry.
+Added: Thus, this shortage of skilled labor could continue over an extended period.
+Added: If the shortage of experienced labor continues or worsens, it could have an adverse impact on our labor productivity and costs and our ability to expand production in the event there is an increase in the demand for our coal, which could adversely affect our profitability.
+Added: Disruptions in supply chains could significantly impair our operating profitability.
+Added: We are dependent upon vendors to supply mining equipment, safety equipment, supplies, and materials.
+Added: If a vendor fails to deliver on its commitments, or if common carriers have difficulty providing capacity to meet demands for their services, we could experience reductions in our production or increased production costs, which could lead to reduced profitability and adversely affect our results of operations.
+Added: Inflationary pressures could significantly impair our operating profitability.
+Added: Any future inflationary or deflationary pressures could adversely affect the results of our operations.
+Added: For example, at times our results have been significantly impacted by price increases affecting many of the components of our operating expenses such as fuel, steel, maintenance expense and labor.
+Added: In addition to potential cost increases, inflation could cause a decline in global or regional economic conditions that reduce demand for our coal or oil & gas and could adversely affect our results of operations.
+Added: The unavailability of an adequate supply of coal mineral reserves and resources that can be mined at competitive costs could cause our profitability to decline.
+Added: Our profitability depends substantially on our ability to mine coal mineral reserves and resources that have the geological characteristics that enable them to be mined at competitive costs and to meet the quality needed by our customers.
+Added: Because we deplete our reserves and resources as we mine coal, our future success and growth depend, in part, upon our ability to acquire additional coal mineral reserves and resources that are economically recoverable.
+Added: Replacement reserves and resources may not be available when required or, if available, may not be mineable at costs comparable to those of the depleting mines.
+Added: We may not be able to accurately assess the geological characteristics of any reserves or resources that we acquire, which could adversely affect our profitability and financial condition.
+Added: Exhaustion of reserves and resources at particular mines also could have an adverse effect on our operating results that is disproportionate to the percentage of overall production represented by such mines.
+Added: Our ability to obtain other reserves and resources in the future
+Added: could be limited by restrictions under our existing or future debt agreements, competition from other coal companies for attractive properties, the lack of suitable acquisition candidates, or the inability to acquire coal properties on commercially reasonable terms.
+Added: The estimates of our coal mineral reserves and resources could prove inaccurate and could result in decreased profitability.
+Added: The estimates of our coal mineral reserves and resources could vary substantially from the actual amounts of coal we are able to economically recover.
+Added: The reserve and resource data set forth in "Item 2.
+Added: Properties—Coal Mineral Resources and Reserves"
+Added: represent engineering estimates.
+Added: All of the coal mineral reserves presented in this Annual Report on Form 10-K constitute proven and probable mineral reserves.
+Added: There are numerous uncertainties inherent in estimating quantities of reserves and resources, including many factors beyond our control.
+Added: Estimates of coal mineral reserves and resources necessarily depend upon a number of variables and assumptions, any one of which could vary considerably from actual results.
These factors and assumptions relate to:
5 unchanged sentences
● assumptions concerning future coal prices, operating costs, capital expenditures, severance and excise taxes, and development and reclamation costs.
−Removed: For these reasons, estimates of the recoverable quantities of coal attributable to any particular group of properties, classifications of reserves based on the risk of recovery, and estimates of future net cash flows expected from these properties as prepared by different engineers, or by the same engineers at different times, could vary substantially.
−Removed: Actual production, revenue, and expenditures with respect to our reserves will likely vary from estimates, and these variations could be material.
−Removed: Any inaccuracy in the estimates of our reserves could result in higher than expected costs and decreased profitability.
+Added: Each of the factors which impacts reserve and resource estimation may vary considerably from the assumptions used in making the estimation and, as a result, the estimates in this report may not accurately reflect our actual coal reserves and resources.
+Added: Actual production, revenues and expenditures with respect to our coal reserves will likely vary from the assumptions used in these estimates, and these variances may be material.
+Added: Government regulations and other pressures may result in closure of coal-fired electric generating plants earlier than assumed.
+Added: Such changes would reduce the economic viability of our mining operations and could have a material adverse impact on our operations and financial results.
+Added: Additionally, the estimates of coal reserves and resources may be adversely affected in future fiscal periods by the SEC's recent rule amendments revising property disclosure requirements for publicly traded coal mining companies, with which we are complying for the first time in this report.
Coal mining in certain areas in which we operate is more difficult and involves more regulatory constraints than mining in other areas of the United States, which could affect the mining operations and cost structures of these areas.
−Removed: The geological characteristics of some of our coal reserves, such as depth of overburden and coal seam thickness, make them difficult and costly to mine.
−Removed: As mines become depleted, replacement reserves may not be available when required or, if available, may not be mineable at costs comparable to those characteristic of the depleting mines.
+Added: The geological characteristics of some of our coal mineral reserves, such as depth of overburden and coal seam thickness, make them difficult and costly to mine.
+Added: As mines become depleted, replacement reserves may not be available when required or, if available, may not be mineable at costs comparable to those of the depleting mines.
In addition, permitting, licensing, and other environmental and regulatory requirements associated with certain of our mining operations are more costly and time-consuming to satisfy.
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There is also continuing pressure on federal and state regulators to impose limits on carbon dioxide emissions from electric power plants, particularly coal-fired power plants.
−Removed: Further, far-reaching federal regulations promulgated by the EPA in the last several years, such as CSAPR and MATS, have led to the premature retirement of coal-fired generating units and a significant reduction in the amount of coal-fired generating capacity in the United States Please read "Item 1.
+Added: Further, far-reaching federal regulations promulgated by the
+Added: EPA in the last several years, such as CSAPR and MATS, have led to the premature retirement of coal-fired generating units and a significant reduction in the amount of coal-fired generating capacity in the United States.
+Added: Please read "Item 1.
Business—Environmental, Health and Safety Regulations— Air Emissions ,"
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At this time, it is not possible to estimate the impact on our business of newly enacted or potential federal or state legislation governing hydraulic fracturing.
−Removed: Legislation or regulatory initiatives intended to address seismic activity could restrict our operators ' drilling and production activities, as well as their ability to dispose of produced water gathered from such activities, which could have a material adverse effect on our minerals segment.
+Added: Legislation or regulatory initiatives intended to address seismic activity could restrict our operators ' drilling and production activities, as well as their ability to dispose of produced water gathered from such activities, which could have a material adverse effect on our business.
State and federal regulatory agencies have recently focused on a possible connection between the hydraulic fracturing related activities, particularly the underground injection of wastewater into disposal wells, and the increased occurrence of seismic activity, and regulatory agencies at all levels are continuing to study the possible linkage between oil & gas activity and induced seismicity.
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In addition, a number of lawsuits have been filed in other states, including in Oklahoma, alleging that disposal well operations have caused damage to neighboring properties or otherwise violated state and federal rules regulating waste disposal.
−Removed: In response to these concerns, regulators in some states are seeking to impose additional requirements, including requirements in the permitting of produced water disposal wells or otherwise to assess the relationship between seismicity
−Removed: and the use of such wells.
−Removed: For example, both Texas and Oklahoma have imposed certain limits on the permitting or operation of disposal wells in areas with increased instances of induced seismic events, and in some instances, regulators may order disposal wells be shut-in.
+Added: In response to these concerns, regulators in some states are seeking to impose additional requirements, including requirements in the permitting of produced water disposal wells or otherwise to assess the relationship between seismicity and the use of such wells.
+Added: For example, both Texas and Oklahoma have imposed certain limits on the permitting or operation of disposal wells in areas with increased instances of induced seismic events.
+Added: In September 2021, the Texas Railroad Commission ("TRRC") issued a notice to operators in the Midland area to reduce saltwater disposal well activities and provide certain data to the TRRC.
+Added: Subsequently, the TRRC ordered the indefinite suspension of all deep oil and gas produced water injection wells in the area, effective December 31, 2021.
The adoption or implementation of any new laws or regulations that restrict our operators' ability to use hydraulic fracturing or dispose of produced water gathered from drilling and production activities by limiting volumes, disposal rates, disposal well locations, or otherwise, or requiring our operators to shut down or limit the operation of disposal wells, could have a material adverse effect on our business, financial condition and results of operations.
−Removed: Our operations are subject to a series if risks resulting from climate change.
+Added: Our operations are subject to a series of risks resulting from climate change.
Combustion of fossil fuels, such as the coal we produce and the oil & gas produced from our mineral interests, results in the emission of carbon dioxide into the atmosphere.
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for more information, see our regulatory disclosure titled "GHG emissions").
−Removed: Additionally, relating to our oil and gas mineral interests, President Biden has signed an executive order calling for the suspension, revision, or rescission of a September 2020 rule that reduced certain restrictions on GHG emissions from the oil and gas sector.
+Added: Additionally, relating to our oil and gas mineral interests, the U.S.
+Added: Congress approved, and President Biden signed into law, a resolution under the Congressional Review Act to repeal September 2020 revisions to methane standards, effectively reinstating the more stringent 2016 standards.
+Added: Furthermore, in November 2021, EPA issued a proposed rule that, if finalized, would establish new sources and first-time existing source standards of performance for methane and volatile organic compound emissions for oil and gas facilities.
+Added: Operators of affected facilities will have to comply with specific standards of performance to include leak detection using optical gas imaging and subsequent repair requirement, and reduction of emissions by 95% through capture and control systems.
+Added: EPA plans to issue a supplemental proposal in 2022 containing additional requirements not included in the November 2021 proposed rule and anticipates the issuance of final rule by the end of the year.
+Added: We cannot predict the scope of any final methane regulatory requirements or the cost for our operators to comply with such requirements.
+Added: However, given the long-term trend toward increasing regulation, future federal GHG regulations of the oil and gas industry remain a significant possibility.
Separately, various states and groups of states have adopted or are considering adopting legislation, regulations, or other regulatory initiatives that are focused on such areas as GHG cap-and-trade programs, carbon taxes, reporting and tracking programs, and restriction of emissions.
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These commitments could further reduce demand and prices for fossil fuels.
−Removed: Although the United States had withdrawn from the Paris Agreement, President Biden has signed executive orders recommitting the United States to the agreement and calling for the federal government to begin formulating the United States' nationally determined emissions reduction targets under the agreement.
−Removed: However, the impact of these orders, and the terms of any legislation or regulation to implement the United States' commitment under the Paris Agreement, remain unclear at this time.
+Added: Although the United States had withdrawn from the Paris Agreement, following President Biden’s executive order in January 2021, the United States rejoined the Agreement and, in April 2021, established a goal of reducing economy-wide net GHG emissions 50-52% below levels by 2030.
+Added: Additionally, at COP26 in Glasgow in November 2021, the United States and the European Union jointly announced the launch of a Global Methane Pledge committing to a collective goal of reducing global methane emissions by at least 30% from 2020 levels by 2030, including "all feasible reductions"
+Added: in the energy sector.
+Added: The full impact of these actions is uncertain at this time and it is unclear what additional initiatives may be adopted or implemented that may have adverse effects upon us and our operators' operations.
Governmental, scientific, and public concern over climate change has also resulted in increased political risks, including certain climate-related pledges made by certain candidates now in political office.
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Depending on the particular program, we, our customers, or operators of our mineral interests could be required to control GHG emissions or to purchase and surrender allowances for GHG emissions resulting from our operations.
−Removed: Litigation risks are also increasing, as a number of cities, local governments, and other plaintiffs have sued various fossil fuels companies in state and federal courts, alleging various legal theories to recover for the impacts of alleged damages from global warming, such as rising sea levels.
−Removed: Many of these suits allege that the companies have been aware of the adverse effects of climate change for some time but
−Removed: defrauded their investors or customers by failing to adequately disclose those impacts.
−Removed: Although a number of these lawsuits have been dismissed, others remain pending and the outcome of these cases remains difficult to predict.
+Added: Litigation risks are also increasing.
+Added: For more information, see our risk factor titled "We, our customers, or the operators of our oil & gas mineral interests could be subject to litigation related to climate change."
Apart from governmental regulation, there are also increasing financial risks for fossil-fuel producers as stakeholders of fossil-fuel energy companies may elect in the future to shift some or all of their support into non-energy related sectors.
Institutional lenders who provide financing to fossil-fuel energy companies also have become more attentive to sustainable lending practices and some of them may elect not to provide funding for fossil-fuel energy companies.
+Added: For example, at COP26, the Glasgow Financial Alliance for Net Zero ("GFANZ") announced that commitments from over 450 firms across 45 countries had resulted in over $130 trillion in capital committed to net zero goals.
+Added: The various sub-alliances of GFANZ generally require participants to set short-term, sector-specific targets to transition their financing, investing, and/or underwriting activities to net zero emissions by 2050.
There is also a risk that financial institutions will be required to adopt policies that have the effect of reducing the funding provided to the fossil-fuel sector.
−Removed: Recently, the Federal Reserve announced it had joined the Network for Greening the Financial System, a consortium of financial regulators focused on addressing climate-related risks in the financial sector.
−Removed: Limitation of investments in and financing, bonding, and insurance coverages for fossil-fuel energy companies could adversely affect mining or oil & gas production activities.
+Added: In late 2020, the Federal Reserve announced it had joined the Network for Greening the Financial System ("NGFS"), a consortium of financial regulators focused on addressing climate-related risks in the financial sector.
+Added: Subsequently, in November 2021, the Federal Reserve issued a statement in support of the efforts of the NGFS to identify key issues and potential solutions for the climate-related challenges most relevant to central banks and supervisory authorities.
+Added: Although we cannot predict the effects of these actions, such limitation of investments in and financing, bonding, and insurance coverages for fossil-fuel energy companies could adversely affect our coal mining or oil & gas production activities.
+Added: Additionally, the SEC announced its intention to promulgate rules requiring climate disclosures.
+Added: Although the form and substance of these requirements is not yet known, this may result in additional costs to comply with any such disclosure requirements.
The adoption and implementation of new or more stringent international, federal, or state legislation, regulations, or other regulatory initiatives that impose more stringent standards for GHG emissions from fossil-fuel companies could result in increased costs of compliance or costs of consuming, and thereby reduce demand for coal and oil & gas, which could reduce the profitability of our interests.
−Removed: Additionally, political, litigation, and financial risks could result in either us our oil & gas operators restricting or canceling mining or oil & gas production activities, incurring liability for infrastructure damages as a result of climatic changes, or having an impaired ability to continue to operate in an economic manner.
+Added: Additionally, political, litigation, and financial risks could result in either us or oil & gas operators restricting or canceling mining or oil & gas production activities, incurring liability for infrastructure damages as a result of climatic changes, or having an impaired ability to continue to operate economically.
One or more of these developments, as well as concerted conservation and efficiency efforts that result in reduced electricity consumption, and consumer and corporate preferences for non-fossil-fuel sources, including alternative energy sources, could cause prices and sales of our coal and/or oil & gas to materially decline and could cause our costs to increase and adversely affect our revenues and results of operations.
+Added: Climate change may also result in various physical risks, such as the increased frequency or intensity of extreme weather events or changes in meteorological and hydrological patterns that could adversely impact our operations, as well as those of our operators and their supply chain.
+Added: Such physical risks may result in damage to our facilities or our operators' facilities or otherwise adversely impact operations which could decrease the production attributable to our mineral interests.
+Added: We may not have insurance to cover these risks and the consequences for our or their operations could have a negative impact on the costs and revenues from operations.
Some of our operating subsidiaries lease a portion of the surface properties upon which their mining facilities are located.
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Certain of the operating companies have constructed and now operate all or some portion of their facilities on properties owned by unrelated third parties with whom our subsidiary has entered into a long-term lease.
−Removed: We have no reason to believe that there exists any risk of loss of these leasehold rights given the terms and provisions of the subject leases and the nature and identity of the third-party lessors;
+Added: have no reason to believe that there exists any risk of loss of these leasehold rights given the terms and provisions of the subject leases and the nature and identity of the third-party lessors;
however, in the unlikely event of any loss of these leasehold rights, operations could be disrupted or otherwise adversely impacted as a result of increased costs associated with retaining the necessary land use.
−Removed: Unexpected increases in raw material costs could significantly impair our operating profitability.
−Removed: Our coal mining operations are affected by commodity prices.
−Removed: We use significant amounts of steel, petroleum products, and other raw materials in various pieces of mining equipment, supplies, and materials, including the roof bolts required by the room-and-pillar method of mining.
−Removed: Steel prices and the prices of scrap steel, natural gas, and coking coal consumed in the production of iron and steel fluctuate significantly and could change unexpectedly.
−Removed: There could be acts of nature or terrorist attacks or threats that could also impact the future costs of raw materials.
−Removed: Future volatility in the price of steel, petroleum products, or other raw materials will impact our operational expenses and could result in significant fluctuations in our profitability.
Federal and state laws require bonds to secure our obligations related to statutory reclamation requirements and workers ' compensation and black lung benefits.
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These bonds are typically renewable on a yearly basis.
−Removed: The failure to maintain or the inability to acquire
−Removed: sufficient surety bonds, as required by federal and state laws, could subject us to fines and penalties and result in the loss of our mining permits.
+Added: The failure to maintain or the inability to acquire sufficient surety bonds, as required by federal and state laws, could subject us to fines and penalties and result in the loss of our mining permits.
Such failure could result from a variety of factors, including:
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The operators may elect not to undertake development activities or may undertake these activities in an unanticipated fashion, which could result in significant fluctuations in our oil & gas revenues.
−Removed: We have little to no control over the timing of future drilling with respect to our mineral interests.
+Added: We have little to no control over the timing of future drilling with respect to our oil & gas mineral interests.
All of our oil & gas mineral interests may not ultimately be developed or produced by the operators of our properties.
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Our estimates of proved reserves and related valuations as of December 31, 2021, were audited by Netherland, Sewell & Associates, Inc.
−Removed: ("NSAI"), which conducted a detailed review of all of our properties at that time using information provided by us.
−Removed: Over time, we may make material changes to reserve estimates taking into account the results of actual drilling, testing, and production.
+Added: ("NSAI"), which conducted a detailed review of all of our properties at that time using the information provided by us.
+Added: Over time, we may make material changes to reserve estimates taking into account the results of actual
+Added: drilling, testing, and production.
In addition, certain assumptions regarding future oil & gas prices, production levels, and operating costs could prove incorrect.
−Removed: A meaningful portion of our reserve estimates is made without the benefit of lengthy production history, which are less reliable than estimates based on lengthy production history.
+Added: A meaningful portion of our reserve estimates is made without the benefit of lengthy production history, which is less reliable than estimates based on lengthy production history.
Any significant variance from these assumptions to actual figures could greatly affect our estimates of reserves and future cash generated from operations.
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In accordance with rules established by the SEC and the Financial Accounting Standards Board ("FASB"), we base the estimated discounted future net cash flows from our proved reserves on the twelve-month average oil & gas index prices, calculated as the unweighted arithmetic average for the first day-of-the-month price for each month, and costs in effect on the date of the estimate, holding the prices and costs constant throughout the life of the properties.
−Removed: Actual future prices and costs could differ materially from those used in the present value estimate, and future net present value estimates using then-current prices and costs could be significantly less than
−Removed: the current estimate.
+Added: Actual future prices and costs could differ materially from those used in the present value estimate, and future net present value estimates using then-current prices and costs could be significantly less than the current estimate.
In addition, the 10% discount factor we use when calculating discounted future net cash flows may not be the most appropriate discount factor based on interest rates in effect from time to time and risks associated with us or the oil & gas industry in general.
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Insufficient production from the wells on our acreage or a significant disruption in the availability of third-party transportation facilities or other production facilities could adversely impact our operators' ability to deliver to market or produce oil & gas and thereby cause a significant interruption in our operators' operations.
−Removed: If they are unable, for any sustained period, to implement acceptable delivery or transportation arrangements or encounter production-related difficulties, they may be required to shut-in or curtail production.
+Added: are unable, for any sustained period, to implement acceptable delivery or transportation arrangements or encounter production-related difficulties, they may be required to shut-in or curtail production.
In addition, the amount of oil & gas that can be produced and sold may be subject to curtailment in certain other circumstances outside of our or our operators' control, such as pipeline interruptions due to maintenance, excessive pressure, inability of downstream processing facilities to accept unprocessed gas, physical damage to the gathering system or transportation system or lack of contracted capacity on such systems.
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Expansions and acquisitions involve a number of risks, any of which could cause us not to realize the anticipated benefits.
−Removed: Since our formation and the acquisition of our predecessor in August 1999, we have expanded our coal operations by adding and developing mines and coal reserves in existing, adjacent, and neighboring properties.
−Removed: Similarly, the profitability of our minerals segment depends significantly upon acquisitions to grow our oil & gas reserves, production, and free cash flow.
−Removed: Our future growth could be limited if we are unable to continue to make acquisitions in either our coal operations or our minerals business, or if we are unable to successfully integrate the companies, businesses, or properties we acquire.
+Added: Since our formation and the acquisition of our predecessor in August 1999, we have expanded our coal operations by adding and developing mines in existing, adjacent, and neighboring properties.
+Added: Similarly, the profitability of our business depends significantly upon acquisitions to grow our coal and oil & gas reserves, production, and free cash flow.
+Added: Our future growth could be limited if we are unable to continue to make acquisitions in either our coal operations or our royalties segments, or if we are unable to successfully integrate the companies, businesses, or properties we acquire.
We may not be successful in consummating any acquisitions and the consequences of undertaking these acquisitions are unknown.
−Removed: There is intense competition for acquisition opportunities in our industry.
−Removed: Competition for acquisitions could increase the cost of, or cause us to refrain from, completing acquisitions.
+Added: Competition for acquisitions of coal and oil & gas mineral interests could increase the cost of, or cause us to refrain from, completing acquisitions.
Our ability to complete acquisitions is dependent upon, among other things, our ability to obtain debt and equity financing under acceptable terms.
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Any one or more of these factors could cause us not to realize the benefits anticipated to result from an expansion or acquisition.
−Removed: Any expansion or acquisition opportunities we pursue could materially affect our liquidity and capital
−Removed: resources and could require us to incur indebtedness, seek equity capital, or both.
+Added: Any expansion or acquisition opportunities we pursue could materially affect our liquidity and capital resources and could require us to incur indebtedness, seek equity capital, or both.
Future expansions or acquisitions could result in us assuming more long-term liabilities relative to the value of the acquired assets than we have assumed in our previous expansions and/or acquisitions.
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Tax Risks to Our Common Unitholders
−Removed: Our tax treatment depends on our status as a partnership for federal income tax purposes, and our not being subject to a material amount of entity-level taxation.
−Removed: If the IRS were to treat us as a corporation for federal income tax purposes, or we become subject to entity-level taxation for state tax purposes, our cash available for distribution to you would be substantially reduced.
−Removed: The anticipated after-tax benefit of an investment in our units depends largely on our being treated as a partnership for United States federal income tax purposes.
−Removed: Despite the fact that we are organized as a limited partnership under Delaware law, we would be treated as a corporation for United States federal income tax purposes unless we satisfy a "qualifying income"
+Added: Our tax treatment depends on our status as a partnership for U.S.
+Added: federal income tax purposes, and our not being subject to a material amount of entity-level taxation.
+Added: If the IRS were to treat us as a corporation for U.S.
+Added: federal income tax purposes, or we become subject to entity-level taxation for state tax purposes, our cash available for distribution to you would be substantially reduced.
+Added: The anticipated after-tax benefit of an investment in our common units depends largely on our being treated as a partnership for U.S.
+Added: federal income tax purposes.
+Added: Despite the fact that we are organized as a limited partnership under Delaware law, we would be treated as a corporation for U.S.
+Added: federal income tax purposes unless we satisfy a "qualifying income"
Based upon our current operations and current Treasury Regulations, we believe we satisfy the qualifying income requirement.
However, we have not requested, and do not plan to request, a ruling from the IRS on this or any other matter affecting us.
−Removed: Failing to meet the qualifying income requirement or a change in current law could cause us to be treated as a corporation for United States federal income tax purposes or otherwise subject us to taxation as an entity.
−Removed: If we were treated as a corporation for United States federal income tax purposes, we would pay United States federal income tax on our taxable income at the corporate tax rate, and would likely be liable for state income tax at varying rates.
+Added: Failing to meet the qualifying income requirement or a change in current law could cause us to be treated as a corporation for U.S.
+Added: federal income tax purposes or otherwise subject us to taxation as an entity.
+Added: If we were treated as a corporation for U.S.
+Added: federal income tax purposes, we would pay U.S.
+Added: federal income tax on our taxable income at the corporate tax rate, and would likely be liable for state income tax at varying rates.
Distributions to our unitholders would generally be taxed again as corporate distributions, and no income, gains, losses, deductions or credits would flow through to our unitholders.
Because taxes would be imposed upon us as a corporation, our cash available for distribution to our unitholders would be substantially reduced.
−Removed: Therefore, our treatment as a corporation would result in a material reduction in the anticipated cash flow and after-tax return to our unitholders, likely causing a substantial reduction in the value of the units.
+Added: Therefore, our treatment as a corporation would result in a material reduction in the anticipated cash flow and after-tax return to our unitholders, likely causing a substantial reduction in the value of our common units.
At the state level, several states have been evaluating ways to subject partnerships to entity-level taxation through the imposition of state income, franchise or other forms of taxation.
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The tax treatment of publicly traded partnerships or an investment in our units could be subject to potential legislative, judicial or administrative changes or differing interpretations, possibly applied on a retroactive basis.
−Removed: The present United States federal income tax treatment of publicly traded partnerships, including us, or an investment in our common units may be modified by administrative, legislative or judicial changes or differing interpretations at any time.
−Removed: Members of Congress have frequently proposed and considered substantive changes to the existing United States federal income tax laws that would affect publicly traded partnerships, including proposals that would eliminate our ability to qualify for partnership tax treatment.
+Added: The present U.S.
+Added: federal income tax treatment of publicly traded partnerships, including us, or an investment in our common units may be modified by administrative, legislative or judicial changes or differing interpretations at any time.
+Added: Members of Congress have frequently proposed and considered substantive changes to the existing U.S.
+Added: federal income tax laws that would affect publicly traded partnerships, including proposals that would eliminate our ability to qualify for partnership tax treatment.
+Added: Recent proposals have provided for the expansion of the qualifying income exception for publicly traded partnerships in certain circumstance and other proposals have provided for the total elimination of the qualifying income exception upon which we rely for our partnership tax treatment.
In addition, the Treasury Department has issued, and in the future may issue, regulations interpreting those laws that affect publicly traded partnerships.
−Removed: There can be no assurance that there will not be further changes to United States federal income tax laws or the Treasury Department's interpretation of the qualifying income rules in a manner that could impact our ability to qualify as a partnership in the future.
−Removed: Any modification to the United States federal income tax laws and interpretation thereof may or may not be applied retroactively and could make it more difficult or impossible for us to meet the exception for certain publicly traded partnerships to be treated as partnerships for United States federal income tax purposes.
+Added: There can be no assurance that there will not be further changes to U.S.
+Added: federal income tax laws or the Treasury Department's interpretation of the qualifying income rules in a manner that could impact our ability to qualify as a partnership in the future.
+Added: Any modification to the U.S.
+Added: federal income tax laws and interpretation thereof may or may not be applied retroactively and could make it more difficult or impossible for us to meet the exception for certain publicly traded partnerships to be treated as partnerships for U.S.
+Added: federal income tax purposes.
We are unable to predict whether any changes or other proposals will ultimately be enacted.
−Removed: Any similar or future legislative changes could negatively impact the value of an investment in our units.
−Removed: You are urged to consult with your own tax advisor with respect to the status of regulatory or administrative developments and proposals and their potential effect on your investment in our units.
−Removed: If the IRS were to contest the federal income tax positions we take, it may adversely impact the market for our units, and the costs of any such contest would reduce cash available for distribution to our unitholders.
−Removed: We have not requested a ruling from the IRS with respect to our treatment as a partnership for federal income tax purposes.
+Added: Any similar or future legislative changes could negatively impact the value of an investment in our common units.
+Added: You are urged to consult with your own tax advisor with respect to the status of regulatory or administrative developments and proposals and their potential effect on your investment in our common units.
+Added: If the IRS were to contest the U.S.
+Added: federal income tax positions we take, it may adversely impact the market for our common units, and the costs of any such contest would reduce cash available for distribution to our unitholders.
+Added: We have not requested a ruling from the IRS with respect to our treatment as a partnership for U.S.
+Added: federal income tax purposes.
The IRS may adopt positions that differ from the positions that we take.
−Removed: It may be necessary to resort to administrative or court proceedings to sustain some or all of the positions we take.
+Added: It may be necessary to resort to
+Added: administrative or court proceedings to sustain some or all of the positions we take.
A court may not agree with some or all of the positions we take.
−Removed: Any contest with the IRS may materially and adversely impact the market for our units and the price at which they trade.
+Added: Any contest with the IRS may materially and adversely impact the market for our common units and the price at which they trade.
Moreover, the costs of any contest between us and the IRS will result in a reduction in our cash available for distribution to our unitholders and thus will be borne indirectly by our unitholders.
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As a result, our current unitholders may bear some or all of the tax liability resulting from such audit adjustment, even if such unitholders did not own units in us during the tax year under audit.
−Removed: If, as a result of
−Removed: any such audit adjustment, we are required to pay taxes, penalties and interest, our cash available for distribution to our unitholders might be substantially reduced and our current and former unitholders may be required to indemnify us for any taxes (including any applicable penalties and interest) resulting from such audit adjustments that were paid on such unitholders' behalf.
+Added: If, as a result of any such audit adjustment, we are required to pay taxes, penalties and interest, our cash available for distribution to our unitholders might be substantially reduced and our current and former unitholders may be required to indemnify us for any taxes (including any applicable penalties and interest) resulting from such audit adjustments that were paid on such unitholders' behalf.
These rules are not applicable for tax years beginning on or prior to December 31, 2017.
Even if you do not receive any cash distributions from us, you will be required to pay taxes on your share of our taxable income.
−Removed: You will be required to pay federal income taxes and, in some cases, state and local income taxes, on your share of our taxable income, whether or not you receive cash distributions from us.
+Added: You will be required to pay U.S.
+Added: federal income taxes and, in some cases, state and local income taxes, on your share of our taxable income, whether or not you receive cash distributions from us.
You may not receive cash distributions from us equal to your share of our taxable income or even equal to the actual tax liability which results from your share of our taxable income.
−Removed: Tax gain or loss on the disposition of our units could be more or less than expected.
−Removed: If you sell your units, you will recognize gain or loss equal to the difference between the amount realized and your tax basis in those units.
+Added: Tax gain or loss on the disposition of our common units could be more or less than expected.
+Added: If you sell your units, you will recognize gain or loss equal to the difference between the amount realized and your tax basis in those common units.
Because distributions in excess of your allocable share of our net taxable income result in a decrease in your tax basis in your units, the amount, if any, of such prior excess distributions with respect to the units you sell will, in effect, become taxable income to you if you sell such units at a price greater than your tax basis therein, even if the price you receive is less than your original cost.
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In general, we are entitled to a deduction for interest paid or accrued on indebtedness properly allocable to our trade or business during our taxable year.
−Removed: However, subject to the exceptions in the Coronavirus Aid, Relief, and Economic Security Act (the "CARES Act,"
−Removed: discussed below), under the Tax Cuts and Jobs Act, for taxable years beginning after December 31, 2017, our deduction for "business interest"
+Added: However, under the Tax Cuts and Jobs Act, for taxable years beginning after December 31, 2017, our deduction for "business interest"
is limited to the sum of our business interest income and 30% of our "adjusted taxable income."
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As a result, unitholders may be subject to limitation on their ability to deduct interest expense incurred by us.
−Removed: For our 2020 taxable year, the CARES Act increases the 30% adjusted taxable income limitation to 50%, unless we elect not to apply such increase.
−Removed: For purposes of determining our 50% adjusted taxable income limitation, we may elect to substitute our 2020 adjusted taxable income with our 2019 adjusted taxable income, which may result in a greater business interest expense deduction.
−Removed: In addition, unitholders may treat 50% of any excess business interest allocated to them in 2019 as deductible in the 2020 taxable year without regard to the 2020 business interest expense limitations.
−Removed: The remaining 50% of such unitholder's excess business interest is carried forward and subject to the same limitations as other taxable years.
−Removed: Tax-exempt entities face unique tax issues from owning our units that may result in adverse tax consequences to them.
−Removed: Investment in our units by tax-exempt entities, such as employee benefit plans and individual retirement accounts (known as "IRAs") raises issues unique to them.
−Removed: For example, virtually all of our income allocated to organizations that
−Removed: are exempt from United States federal income tax, including IRAs and other retirement plans, will be unrelated business taxable income and will be taxable to them.
−Removed: Tax-exempt entities should consult a tax advisor before investing in our units.
−Removed: Non-United States unitholders will be subject to United States taxes and withholding with respect to their income and gain from owning our units.
−Removed: Non-United States unitholders are generally taxed and subject to income tax filing requirements by the United States on income effectively connected with a United States trade or business ("effectively connected income").
+Added: Tax-exempt entities face unique tax issues from owning our common units that may result in adverse tax consequences to them.
+Added: Investment in our common units by tax-exempt entities, such as employee benefit plans and individual retirement accounts (known as "IRAs") raises issues unique to them.
+Added: For example, virtually all of our income allocated to organizations that are exempt from U.S.
+Added: federal income tax, including IRAs and other retirement plans, will be unrelated business taxable income and will be taxable to them.
+Added: Tax-exempt entities should consult a tax advisor before investing in our common units.
+Added: unitholders will be subject to U.S.
+Added: taxes and withholding with respect to their income and gain from owning our units.
+Added: unitholders are generally taxed and subject to income tax filing requirements by the United States on income effectively connected with a U.S.
+Added: trade or business ("effectively connected income").
Income allocated to our unitholders and any gain from the sale of our units will generally be considered to be "effectively connected"
−Removed: with a United States trade or business.
−Removed: As a result, distributions to a Non-United States unitholder will be subject to withholding at the highest applicable effective tax rate and a Non-United States unitholder who sells or otherwise disposes of a unit will also be subject to United States federal income tax on the gain realized from the sale or disposition of that unit.
−Removed: Moreover, the transferee of an interest in a partnership that is engaged in a United States trade or business is generally required to withhold 10% of the amount realized by the transferor unless the transferor certifies that it is not a foreign person.
+Added: trade or business.
+Added: As a result, distributions to a Non-U.S.
+Added: unitholder will be subject to withholding at the highest applicable effective tax rate and a Non-U.S.
+Added: unitholder who sells or otherwise disposes of a unit will also be subject to U.S.
+Added: federal income tax on the gain realized from the sale or disposition of that unit.
+Added: Moreover, the transferee of an interest in a partnership that is engaged in a U.S.
+Added: trade or business is generally required to withhold 10% of the amount realized by the transferor unless the transferor certifies that it is not a foreign person.
While the determination of a partner's "amount realized"
−Removed: generally includes any decrease of a partner's share of the partnership's liabilities, recently issued Treasury regulations provide that the "amount realized"
+Added: generally includes any decrease of a partner's share of the partnership's liabilities, the Treasury regulations provide that the "amount realized"
on a transfer of an interest in a publicly traded partnership, such as our common units, will generally be the amount of gross proceeds paid to the broker effecting the applicable transfer on behalf of the transferor, and thus will be determined without regard to any decrease in that partner's share of a publicly traded partnership's liabilities.
−Removed: The Treasury regulations further provide that withholding on a transfer of an interest in a publicly traded partnership will not be imposed on a transfer that occurs prior to January 1, 2022, and after that date, if effected through a broker, the obligation to withhold is imposed on the transferor's broker.
−Removed: We treat each purchaser of our units as having the same tax benefits without regard to the units actually purchased.
−Removed: The IRS may challenge this treatment, which could adversely affect the value of our units.
−Removed: Because we cannot match transferors and transferees of units, we have adopted certain methods for allocating depreciation and amortization deductions that may not conform to all aspects of existing Treasury Regulations.
+Added: The Treasury regulations and other guidance from the IRS provide that withholding on a transfer of an interest in a publicly traded partnership will not be imposed on a transfer that occurs prior to January 1, 2023.
+Added: Thereafter, the obligation to withhold on a transfer of interests in a publicly traded partnership that is effected through a broker is imposed on the transferor's broker.
+Added: Current and prospective non-U.S.
+Added: unitholders should consult their tax advisors regarding the impact of these rules on an investment in our common units.
+Added: We treat each purchaser of our common units as having the same tax benefits without regard to the common units actually purchased.
+Added: The IRS may challenge this treatment, which could adversely affect the value of our common units.
+Added: Because we cannot match transferors and transferees of common units, we have adopted certain methods for allocating depreciation and amortization deductions that may not conform to all aspects of existing Treasury Regulations.
A successful IRS challenge to the use of these methods could adversely affect the amount of tax benefits available to you.
−Removed: It also could affect the timing of these tax benefits or the amount of gain from your sale of units and could have a negative impact on the value of our units or result in audit adjustments to your tax returns.
+Added: It also could affect the timing of these tax benefits or the amount of gain from your sale of common units and could have a negative impact on the value of our units or result in audit adjustments to your tax returns.
We generally prorate our items of income, gain, loss and deduction between transferors and transferees of our units each month based upon the ownership of our units on the first day of each month, instead of on the basis of the date a particular unit is transferred.
8 unchanged sentences
If so, such unitholder would no longer be treated for tax purposes as a partner with respect to those units during the period of the loan and may recognize gain or loss from the disposition.
−Removed: Because there are no specific rules governing the United States federal income tax consequence of loaning a partnership interest, a unitholder whose units are the subject of a securities loan may be considered as having disposed of the loaned units.
+Added: Because there are no specific rules governing the U.S.
+Added: federal income tax consequence of loaning a partnership interest, a unitholder whose units are the subject of a securities loan may be considered as having disposed of the loaned units.
In that case, the unitholder may no longer be treated for tax purposes as a partner with respect to those units during the period of the loan to the short seller and the unitholder may recognize gain or loss from such disposition.
−Removed: Moreover, during the period of the loan, any of our income, gain, loss or deduction with respect to those units may not be
−Removed: reportable by the unitholder and any cash distributions received by the unitholder as to those units could be fully taxable as ordinary income.
+Added: Moreover, during the period of the loan, any of our income, gain, loss or deduction with respect to those units may not be reportable by the unitholder and any cash distributions received by the unitholder as to those units could be fully taxable as ordinary income.
Unitholders desiring to assure their status as partners and avoid the risk of gain recognition from a securities loan are urged to consult a tax advisor to determine whether it is advisable to modify any applicable brokerage account agreements to prohibit their brokers from borrowing their units.
−Removed: Certain federal income tax deductions currently available with respect to coal mining and production may be eliminated as a result of future legislation.
−Removed: In past years, members of Congress have indicated a desire to eliminate certain key United States federal income tax provisions currently applicable to coal companies, including the percentage depletion allowance with respect to coal properties.
−Removed: No legislation with that effect has been proposed and elimination of those provisions would not impact our financial statements or results of operations.
−Removed: However, elimination of the provisions could result in unfavorable tax consequences for our unitholders and, as a result, could negatively impact our unit price.
−Removed: You will likely be subject to state and local taxes and income tax return filing requirements in jurisdictions where you do not live as a result of investing in our units.
−Removed: In addition to United States federal income taxes, you will likely be subject to other taxes, such as state and local income taxes, unincorporated business taxes and estate, inheritance or intangible taxes that are imposed by the various jurisdictions in which we do business or own property now or in the future, even if you do not live in any of those jurisdictions.
+Added: federal income tax deductions currently available with respect to coal mining and production may be eliminated as a result of future legislation.
+Added: In past years, members of the U.S.
+Added: Congress have indicated a desire to eliminate certain key U.S.
+Added: federal income tax provisions currently applicable to coal companies, including the percentage depletion allowance with respect to coal properties.
+Added: Elimination of those provisions would not impact our financial statements or results of operations.
+Added: However, elimination of such provisions could result in unfavorable tax consequences for our unitholders and, as a result, could negatively impact our unit price.
+Added: You will likely be subject to state and local taxes and income tax return filing requirements in jurisdictions where you do not live as a result of investing in our common units.
+Added: In addition to U.S.
+Added: federal income taxes, you will likely be subject to other taxes, such as state and local income taxes, unincorporated business taxes and estate, inheritance or intangible taxes that are imposed by the various jurisdictions in which we do business or own property now or in the future, even if you do not live in any of those jurisdictions.
You will likely be required to file state and local income tax returns and pay state and local income taxes in some or all of these various jurisdictions.
2 unchanged sentences
As we make acquisitions or expand our business, we may own assets or conduct business in additional states that impose a personal income tax.
−Removed: It is your responsibility to file all United States federal, foreign, state, and local tax returns and pay any taxes due in these jurisdictions.
+Added: It is your responsibility to file all U.S.
+Added: federal, foreign, state, and local tax returns and pay any taxes due in these jurisdictions.
You should consult with your tax advisors regarding the filing of such tax returns, the payment of such taxes, and the deductibility of any taxes paid.
1 unchanged sentence
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.