What changed in this filing

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Item 1A. Risk Factors

2021-03-15 compared with 2020-02-27 · 110 added, 89 removed, 376 unchanged (35% of the section changed)

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Our unitholders' share of our portfolio income may be taxable to them even though they receive other losses from our activities."

The agreements governing our indebtedness and preferred units restrict our ability to raise, and in some cases continue to pay, distributions on our common units.

Opco’s revolving credit agreement, the indenture governing our 2025 Senior Notes and our partnership agreement each require that we meet certain consolidated leverage tests in order to raise our quarterly distribution on the common units above the current level of $0.45 per quarter.

The agreements governing our indebtedness and preferred units restrict our ability to pay distributions on our common and preferred units under certain circumstances.

The indenture governing our 2025 parent company notes restricts us from paying more than one-half of the quarterly distribution on our preferred units in cash if our consolidated leverage ratio exceeds 3.75x.

Our consolidated leverage ratio has risen since the onset of the COVID-19 pandemic and rose above 3.75x during the third quarter of 2020, and we began paying one-half of the required quarterly distribution in kind through the issuance of additional preferred units (“PIK units”) with respect to such quarter.

To the extent our leverage ratio continues to exceed 3.75x, which we expect for the foreseeable future, we will be required to continue to pay one-half of the required preferred distributions in PIK units and will be unable to redeem any PIK units until our consolidated leverage ratio falls below 3.75x.

Distributions on the outstanding PIK units will accrue and accumulate at 12% per year until such PIK units are redeemed.

Under our partnership agreement, to the extent any PIK units are outstanding at any time after January 1, 2022, we will be prohibited from making any distributions with respect to our common units until we have redeemed all such PIK units in cash.

In addition, Opco’s revolving credit agreement, the indenture governing our 2025 Senior Notes and our partnership agreement each require that we meet certain consolidated leverage tests in order to raise our quarterly distribution on the common units above the current level of $0.45 per quarter.

The maximum leverage covenant under Opco’s revolving credit facility will step down permanently from 4.0x to 3.0x if we increase the common unit distribution above the current level of $0.45 per common unit per quarter.

In addition, under our partnership agreement, to the extent we have paid any distributions on the preferred units in kind ("PIK units") and such PIK units are still outstanding at any time after January 1, 2022, we will be prohibited from making any distributions with respect to our common units until we have redeemed all such PIK units in cash.

For more information on restrictions on our ability to make distributions on our common units, see " Item 7.

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In July 2017, the U.K.

Financial Conduct Authority announced that it intends to stop persuading or compelling banks to submit LIBOR rates after 2021.

Financial Conduct Authority announced that it intends to stop persuading or compelling banks to submit LIBOR rates after late 2021.

Opco’s revolving credit facility includes provisions to determine a replacement rate for LIBOR if necessary during its term, which provide that we will adopt a replacement rate that is broadly accepted by the syndicated loan market.

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Financial Statements and Supplementary Data—Note 11.

The ongoing COVID-19 pandemic has adversely affected our business, and the ultimate effect on our financial condition, results of operations, and ability to make cash distributions to unitholders will depend on future developments, which are highly uncertain and cannot be predicted.

The ongoing COVID-19 pandemic has adversely affected the global economy, disrupted global supply chains and created significant volatility in the financial markets.

In addition, the pandemic has resulted in travel restrictions, business closures and the institution of quarantining and other restrictions on movement in many communities and global trading markets.

Coal markets faced substantial challenges prior to the pandemic, and widespread increases in unemployment and decreases in electricity and steel demand further reduced demand and prices for coal.

In addition, demand for and prices of soda ash decreased, as global manufacturing slowed.

If the reduced demand for and prices of coal and/or soda ash continue for a prolonged period, our financial condition, results of operations, and cash distributions to unitholders may be materially and adversely affected.

Our board of directors determined to suspend cash distributions to our common unitholders with respect to the first quarter of 2020 in order to preserve liquidity due to uncertainties created by the pandemic.

To the extent our board of

directors deems necessary, it may determine to suspend cash distributions in future quarters as a result of the pandemic.

In addition, Ciner Wyoming suspended cash distributions to its members in 2020 due to adverse effects of the pandemic on the global and domestic soda ash markets.

Prices for both metallurgical and thermal coal are volatile and depend on a number of factors beyond our control.

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• the availability of, proximity to and capacity of transportation networks and facilities;

global or national health concerns, including the outbreak of pandemic or contagious disease, such as the recent coronavirus;

• global or national health concerns, including the outbreak of pandemic or contagious disease, such as the ongoing COVID-19 pandemic;

• weather conditions;

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A long-term asset generally is deemed impaired when the future expected cash flow from its use and disposition is less than its book value.

For the fourth quarter of 2019, we recorded an impairment charge of approximately $148 million related to properties that we believe our current or future lessees are unable to operate profitably.

For the year ended December 31, 2020, we recorded impairment charges of approximately $136 million related to properties that we believe our current or future lessees are unable to operate profitably.

Future impairment analyses could result in additional downward adjustments to the carrying value of our assets.

Prices for soda ash are volatile.

Any substantial or extended decline in soda ash prices could have an adverse effect on Ciner Wyoming’s ability to resume distributions to its members and on our results of operations.

The market price of soda ash directly affects the profitability of Ciner Wyoming’s soda ash production operations.

If the market price for soda ash declines, Ciner Wyoming’s sales will decrease.

In 2020, Ciner Wyoming suspended distributions to its members as a result of the adverse impact of the COVID-19 pandemic on global soda ash markets.

Historically, the global

market and, to a lesser extent, the domestic market for soda ash has been volatile, and those markets are likely to remain volatile in the future.

The prices Ciner Wyoming receives for its soda ash depend on numerous factors beyond Ciner Wyoming’s control, including the COVID-19 pandemic, worldwide and regional economic and political conditions impacting supply and demand.

In addition, the impact of the Ciner Corporation exit from ANSAC and Ciner Wyoming’s transition to the utilization of Ciner Group’s global distribution network for some of its export operations beginning 2021 could affect prices received for export sales.

Glass manufacturers and other industrial customers drive most of the demand for soda ash, and these customers experience significant fluctuations in demand and production costs.

Competition from increased use of glass substitutes, such as plastic and recycled glass, has had a negative effect on demand for soda ash.

Substantial or extended declines in prices for soda ash could have a material adverse effect on Ciner Wyoming’s ability to resume distributions to its members and on our results of operations.

We derive a large percentage of our revenues and other income from a small number of coal lessees.

Challenges in the coal mining industry have led to significant consolidation activity.

We own significant interests in all four of Foresight Energy’s mining operations, which accounted for approximately 23% of our total revenues in 2019.

We also own significant interests in several of Contura Energy's mining operations, which accounted for approximately 16% of our total revenues in 2019.

We own significant interests in all of Foresight’s mining operations, which accounted for approximately 26% of our total revenues in 2020.

Foresight is required to pay us a fixed amount of $42.0 million during 2021.

We also own significant interests in several of Alpha Metallurgical Resource's mining operations, which accounted for approximately 24% of our total revenues in 2020.

Certain other lessees have made acquisitions over the past few years resulting in their having an increased interest in our coal reserves.

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Bankruptcies in the coal industry, and/or the idling or closure of mines on our properties could have a material adverse effect on our business and results of operations.

The current coal price environment, together with high operating costs and limited access to capital, has caused a number of coal producers to file for protection under U.S.

bankruptcy and/or idle or close mines that they cannot operate profitably.

The current coal price environment, together with high operating costs and limited access to capital, has caused a number of coal producers to file for protection under bankruptcy laws and/or idle or close mines that they cannot operate profitably.

To the extent our leases are accepted or assigned in a bankruptcy process, pre-petition amounts are required to be cured in full, but we may ultimately make concessions in the financial terms of those leases in order for the reorganized company or new lessor to operate profitably going forward.

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More of our lessees may file for bankruptcy in the future, which will create additional uncertainty as to the future of operations on our properties and could have a material adverse effect on our business and results of operations.

Foresight Energy, which is our largest lessee, is currently working with its lenders and contract counterparties to evaluate restructuring options, which could result in the idling or closure of one or more of its mines or changes in lease terms.

To the extent Foresight determines to idle operations on our properties for a prolonged period or to shut any of its mines on our properties down permanently, or to the extent we agree to amend the terms of our leases with them to facilitate their continued operations on our properties, our business and results of operations could be adversely affected.

Mining operations are subject to operating risks that could result in lower revenues to us.

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While our lessees maintain insurance coverage, there is no assurance that insurance will be available or cover the costs of these risks.

Many of our lessees are experiencing rising costs related to regulatory compliance, insurance coverage, permitting and bonding, transportation, and labor.

Many of our lessees are experiencing rising costs related to regulatory compliance, insurance coverage, permitting

and reclamation bonding, transportation, and labor.

Increased costs result in decreased profitability for our lessees and reduce the competitiveness of coal as a fuel source.

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The adoption of climate change legislation and regulations restricting emissions of greenhouse gases and other hazardous air pollutants have resulted in changes in fuel consumption patterns by electric power generators and a corresponding decrease in coal production by our lessees and reduced coal-related revenues.

Enactment of laws and passage of regulations regarding emissions from the combustion of coal by the U.S., some of its states or other countries, or other actions to limit such emissions, have resulted in and could continue to result in electricity generators switching from coal to other fuel sources and in coal-fueled power plant closures.

Enactment of laws and passage of regulations regarding emissions from the combustion of coal in the United States, and internationally and some of its states or other countries, or other actions to limit such emissions, have resulted in and could continue to result in electricity generators switching from coal to other fuel sources and in coal-fueled power plant closures.

Further, regulations regarding new coal-fueled power plants could adversely impact the global demand for coal.

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Numerous reports have engendered concern about the impacts of human activity, especially fossil fuel combustion, on global climate issues.

In addition to government regulation of greenhouse gas and other air pollutant emissions, there have also been efforts in recent years affecting the investment community, including investment advisors, sovereign wealth funds, public pension funds, universities and other groups, promoting the divestment of fossil fuel equities and also pressuring lenders to limit funding to companies engaged in the extraction of fossil fuels, such as coal.

In addition to government regulation of greenhouse gas and other air pollutant emissions, there are ongoing efforts affecting the investment community, including investment advisors, sovereign wealth funds, public pension funds, universities and other groups, promoting the divestment of fossil fuel equities and ongoing pressure on lenders to limit funding to companies engaged in the extraction of fossil fuels, such as coal.

The impact of such efforts may adversely affect our ability to raise capital.

In addition, a number of insurance companies have taken action to limit coverage for companies in the coal industry, which could result in significant increases in our costs of insurance or in our inability to maintain insurance coverage at current levels.

In addition to climate change and other Clean Air Act legislation, our businesses are subject to numerous other federal, state and local laws and regulations that may limit production from our properties and our profitability.

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Any determination that a landowner or lessee has liability for discharges from a previously reclaimed mine site would result in uncertainty as to continuing liability for completed and reclaimed coal mine operations and could result in substantial compliance costs or fines.

Prices for soda ash are volatile.

Any substantial or extended decline in soda ash prices could have an adverse effect on our results of operations.

The market price of soda ash directly affects the profitability of Ciner Wyoming’s soda ash production operations.

If the market price for soda ash declines, Ciner Wyoming’s sales will decrease.

Historically, the global market and, to a lesser extent, the domestic market for soda ash have been volatile, and those markets are likely to remain volatile in the future.

The prices Ciner Wyoming receives for its soda ash depend on numerous factors beyond Ciner Wyoming’s control, including worldwide and regional economic and political conditions impacting supply and demand.

Glass manufacturers and other industrial customers drive most of the demand for soda ash, and these customers experience significant fluctuations in demand and production costs.

Competition from increased use of glass substitutes, such as plastic and recycled glass, has had a negative effect on demand for soda ash.

Substantial or extended declines in prices for soda ash could have a material adverse effect on our results of operations.

In addition, Ciner Wyoming relies on natural gas as the main energy source in its soda ash production process.

Accordingly, high natural gas prices increase Ciner Wyoming’s cost of production and affect its competitive cost position when compared to other foreign and domestic soda ash producers.

If our lessees do not manage their operations well, their production volumes and our royalty revenues could decrease.

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• credit risk of their customers;

• permitting;

• insurance and surety bonding;

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We might not be able to find a replacement lessee and, if we did, we might not be able to enter into a new lease on favorable terms within a reasonable period of time.

In addition, the existing lessee could be subject to bankruptcy proceedings that could further delay the execution of a new lease or the assignment of the existing lease to another operator.

In addition, the existing lessee could be subject to bankruptcy proceedings that could further delay the execution of a new lease or the assignment of the

existing lease to another operator.

If we enter into a new lease, the replacement operator might not achieve the same levels of production or sell minerals at the same price as the lessee it replaced.

In addition, it may be difficult for us to secure new or replacement lessees for small or isolated mineral reserves.

We are exposed to operating risks that we do not experience in the royalty business through our soda ash joint venture and through our ownership of certain coal transportation assets.

In addition, it may be difficult for us to secure new or replacement lessees.

We have limited approval rights with respect to the management of our Ciner Wyoming soda ash joint venture, including with respect to cash distributions and capital expenditures.

In addition, we are exposed to operating risks that we do not experience in the royalty business through our soda ash joint venture and through our ownership of certain coal transportation assets.

We do not have control over the operations of Ciner Wyoming.

We have limited approval rights with respect to Ciner Wyoming, and our partner controls most business decisions, including decisions with respect to distributions and capital expenditures.

Adverse developments in Ciner Wyoming’s business, including increased maintenance and expansion capital expenditures that we may be required to fund, would result in decreased distributions to NRP.

In addition, we are ultimately responsible for operating the transportation infrastructure at Foresight Energy’s Williamson mine, and have assumed the capital and operating risks associated with that business.

During 2020, Ciner Wyoming suspended quarterly cash distributions to its members due to adverse developments in the soda ash market resulting from the COVID-19 pandemic.

Distributions remain suspended and may continue to be suspended until the soda ash markets improve.

In February 2021, Ciner Resources was informed that an event of default currently exists under a loan to certain non-U.S.

companies in the global Ciner Group.

While the equity interests in Ciner Wyoming and Ciner Resources are not pledged as security for that loan, the equity interests in in Ciner Holding (the sole member of the general partner of Ciner Resources) and in Ciner Corporation (the parent company of Ciner Holding) are pledged as collateral to the lenders under that loan agreement.

Accordingly, unless that event of default is cured or otherwise waived by the requisite number of lenders, the lenders could foreclose on the applicable collateral, which would result in a change of control of Ciner Resources.

Although such a change of control would not result in an event of default under the Ciner Wyoming credit agreement, any such change in ownership could, among other consequences, have a material adverse effect on Ciner Wyoming’s business, financial condition, results of operations, and on our relationship with our soda ash joint venture operating partner.

In addition, we are ultimately responsible for operating the transportation infrastructure at Foresight’s Williamson mine, and have assumed the capital and operating risks associated with that business.

As a result of these investments, we could experience increased costs as well as increased liability exposure associated with operating these facilities.

A significant portion of Ciner Wyoming’s historical international sales of soda ash have been to ANSAC, and the termination of the ANSAC membership could adversely affect Ciner Wyoming’s ability to compete in certain international markets and increase Ciner Wyoming’s international sales costs.

ANSAC has historically been Ciner Wyoming’s largest customer for the years ended December 31, 2019, 2018 and 2017, accounting for 60%, 52% and 45%, respectively, of its net sales.

Following termination of the membership in ANSAC, which will be effective December 31, 2021, there is no assurance that Ciner Wyoming will be able to retain existing foreign customers or secure new foreign customers or the related logistics arrangements on favorable terms.

In July 2020, ANSAC and its members entered into an agreement that, among other things, terminated Ciner Corporation’s membership in ANSAC effective as of December 31, 2020, a year earlier than previously announced.

For a limited period after December 31, 2020, Ciner Corporation.

will continue to sell, at substantially lower volumes, product to ANSAC for export sales purposes, with a fixed rate per ton selling, general and administrative expense, and will also purchase a limited amount of export logistics services.

ANSAC has historically been Ciner Wyoming’s largest customer for the years ended December 31, 2020, 2019 and 2018, accounting for approximately 45%, 60% and 52%, respectively, of its net sales.

Without the ANSAC membership, there is no assurance that Ciner Wyoming.

will be able to retain existing foreign customers or secure new foreign customers or the related logistics arrangements on favorable terms.

The costs to transport and market soda ash following the ANSAC exit could be higher than costs associated with sales through ANSAC.

In addition, Ciner Wyoming will need access to an international logistic infrastructure that includes, among other things, a domestic port for export capabilities.

These export capabilities are currently being developed by Ciner Group, and options being evaluated range from continued outsourcing in the near term to developing Ciner Group’s own port capabilities in the longer term.

There can be no assurance that sufficient export capacity will be obtained.

In addition, the costs associated with a domestic export terminal could be higher than expected.

Adverse developments in Ciner Wyoming’s ability to export soda ash and sell into the foreign markets currently served by ANSAC could result in lower cash distributions to us from Ciner Wyoming.

Significant delays and/or higher than expected costs associated with Ciner Wyoming’s capacity expansion project could adversely affect Ciner Wyoming’s profitability and ability to make distributions to us.

Ciner Wyoming has announced a significant capacity expansion capital project intended to increase production levels to up to 3.5 million tons of soda ash per year.

This project will require capital expenditures materially higher than have been incurred by Ciner Wyoming over the past few years, and Ciner Wyoming intends to fund the project in part by reinvesting cash that would otherwise be distributed to its partners.

In the third quarter of 2019, Ciner Wyoming significantly reduced its cash distributions to its partners, and we expect cash distributions to remain at the current lower level until the project is funded.

However, the costs of the expansion project could be higher than expected, or the execution of the project could be substantially delayed, which could materially impact Ciner Wyoming’s profitability and result in a further reduction of cash distributions to us.

In addition, Ciner Wyoming's deca stockpiles will be substantially depleted by 2023.

Without adding capacity through the expansion project, Ciner Wyoming's production rates would decline approximately 200,000 short tons, which would further impact Ciner Wyoming's profitability.

As a result Ciner Wyoming’s business, results of operations and financial condition could be adversely affected.

Ciner Wyoming’s deca stockpiles will substantially deplete by 2024, and its production rates will decline approximately 200,000 short tons per year if further investments are not made.

In 2024, Ciner Wyoming’s deca stockpiles will be substantially depleted.

Without adding additional capacity, Ciner Wyoming's production rates will decline approximately 200,000 short tons, which would further impact Ciner Wyoming's profitability.

While Ciner Wyoming is currently evaluating an expansion project that would offset this decline as well as provide additional soda ash production above current rates, there is no guarantee that any such investments will be executed successfully or in a timely manner to enable Ciner Wyoming to maintain its current rates of production.

In 2019, Ciner Wyoming announced a significant capacity expansion capital project intended to increase production levels to up to 3.5 million tons of soda ash per year.

When considering the significant investment required by this expansion and the infrastructure improvements designed to increase overall efficiency, combined with the COVID-19 pandemic’s negative impact on Ciner Wyoming’s financial results, Ciner Wyoming has reprioritized the timing of the significant expenditure items in order to increase financial and liquidity flexibility until it has more clarity and visibility into the ongoing impact of the COVID-19 pandemic on its business.

The costs of the expansion project could be higher than expected, or the execution of the project could be substantially delayed, which could materially impact Ciner Wyoming’s profitability and result in a further delay of Ciner Wyoming’s resumption of cash distributions to its members, which in turn could have a material adverse effect on us.

Fluctuations in transportation costs and the availability or reliability of transportation could reduce the production of coal, soda ash and other minerals from our properties.

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In addition, rail operations are subject to various risks that may result in a delay or lack of service at Ciner Wyoming’s facility, and alternative methods of transportation are impracticable or cost prohibitive.

For the year ended December 31, 2019, Ciner Wyoming shipped approximately 96.9% of its soda ash from the Green River facility on a single rail line owned and controlled by Union Pacific.

For the year ended December 31, 2020, Ciner Wyoming shipped approximate ly 97% of its soda ash from the Green River facility on a single rail line owned and controlled by Union Pacific.

Ciner Wyoming’s current transportation contract with Union Pacific expires on December 31, 2021.

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Our reserve estimates depend on many assumptions that may be inaccurate, which could materially adversely affect the quantities and value of our reserves.

In addition, compliance with new SEC rules that will become effective beginning in 2021 could result in material adjustments to the quantities of reserves we are allowed to report.

In addition, we expect to cease reporting coal and hard mineral reserves pursuant to new SEC rules that will be effective for us beginning with the year ending December 31, 2021.

Coal, aggregates and industrial minerals reserve engineering requires subjective estimates of underground accumulations of coal, aggregates and industrial minerals, and assumptions and are by nature imprecise.

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As a result, undue reliance should not be placed on our reserve data that is included in this report.

In addition, the SEC has adopted new rules to modernize the property disclosure requirements for registrants with significant mining activities, which we will be required to begin to comply with for the fiscal year beginning on January 1, 2021 (reported in the Annual Report on Form 10-K for the year ending December 31, 2021).

We are in the process of assessing the impact the new rules will have on our disclosures.

The new rules require that reserve estimates that are reported be based on technical reports prepared using extensive mine-specific geological and engineering data, as well as market and cost assumptions.

As a royalty company, we lease coal reserves to third-party operators that have sole control of the mining and selling of coal from our properties.

We may not have access to much of the information that is required to prepare the technical reports used to determine reserves under the new rules without unreasonable burden or expense.

Accordingly, the amount of coal and other minerals that we are allowed to report under the new rules beginning with the year ending December 31, 2021 may differ materially from what we are currently reporting.

In addition, the SEC has adopted new rules to modernize the property disclosure requirements for registrants with significant mining activities, w hich we will be required to begin to comply with for the fiscal year beginning on January 1, 2021 (reported in the Annual Report on Form 10-K for the year ending December 31, 2021).

The new rules contain exceptions that allow royalty companies, such as NRP, to omit information that they lack access to and cannot obtain without incurring an unreasonable burden or expense.

As a royalty company, we do not have access to a substantial amount information that will be required to prepare the technical reports used to determine reserves under the new rules, and we will not be able to obtain such information without unreasonable burden or expense.

Accordingly, we expect that we will rely on the royalty company exceptions and will therefore cease to report coal and other hard mineral reserves beginning with the year ending December 31, 2021.

Our lessees could satisfy obligations to their customers with minerals from properties other than ours, depriving us of the ability to receive amounts in excess of minimum royalty payments.

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Any undiscovered reporting errors could result in a loss of royalty revenues and errors identified in subsequent periods could lead to accounting disputes as well as disputes with our lessees.

Our business is subject to cybersecurity risks.

Our business is increasingly dependent on information technologies and services.

Threats to information technology systems associated with cybersecurity risks and cyber incidents or attacks continue to grow.

Although we utilize various procedures and controls to mitigate our exposure to such risks, cybersecurity attacks and other cyber events are evolving, unpredictable, and sometimes difficult to detect, and could lead to unauthorized access to sensitive information or render data or systems unusable.

We do not presently maintain insurance coverage to protect against cybersecurity risks.

If we procure such coverage in the future, we cannot ensure that it will be sufficient to cover any particular losses we may experience as a result of such cyber attacks.

Any cyber incident could have a material adverse effect on our business, financial condition and results of operations.

Risks Related to Our Structure

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• the relative voting strength of each previously outstanding unit may be diminished;

and the market price of the common units may decline.

• the market price of the common units may decline.

In addition, to the extent the preferred units are converted into more than 66 2/3% of our common units, the holders of the preferred will have the right to remove our general partner.

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federal income tax treatment of publicly traded partnerships, including us, or an investment in our units, may be modified by administrative, legislative or judicial changes or differing interpretations at any time.

From time to time, members of Congress propose and consider substantive changes to the existing U.S.

federal income tax laws that affect publicly traded partnerships.

Any modification to the U.S.

federal income tax laws may 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.

federal income tax purposes.

For example, the “Clean Energy for America Act,” which is similar to legislation that was commonly proposed during the Obama Administration, was introduced in the Senate on May 2, 2019.

If enacted, this proposal would, among other things, repeal the qualifying income exception within Section 7704(d)(1)(E) of the Code upon which we rely for our status as a partnership for U.S.

federal income tax purposes.

Members of Congress have frequently proposed and considered substantive changes to the existing U.S.

federal income tax laws that would affect publicly traded partnerships, including proposals that would eliminate our ability to qualify for 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.

There can be no assurance that there will not be further changes to U.S.

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 publicly traded partnership in the future.

Furthermore, any interpretation of or modification to the U.S.

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.

Any modification to the U.S.

federal income tax laws and interpretation thereof may or may not be retroactively applied 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.

federal income tax purposes.

We are unable to predict whether any of these changes or other proposals will ultimately be enacted.

Any similar or future legislative changes could negatively impact the value of an investment in our units.

We are unable to predict whether any changes or other proposals will ultimately be enacted.

Any future legislative changes could negatively impact the value of an investment in our units.

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.

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If enacted, these changes would limit or eliminate certain tax deductions that are currently available with respect to coal exploration and development, and any such change could increase the taxable income allocable to our unitholders and negatively impact the value of an investment in our units.

We are not aware of any current proposals with regard to these changes.

Our unitholders are required to pay taxes on their share of our income even if they do not receive any cash distributions from us.

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The ultimate tax effect of any such income allocations will depend on the unitholder's individual tax position, including, for example, the availability of any suspended passive losses that may offset some portion of the allocable income.

Our unitholders may, however, be allocated substantial amounts of ordinary income subject to taxation, without any ability to offset such allocated income against

any capital losses attributable to the unitholder’s ultimate disposition of its units.

Our unitholders may, however, be allocated substantial amounts of ordinary income subject to taxation, without any ability to offset such allocated income against any capital losses attributable to the unitholder’s ultimate disposition of its units.

Our unitholders are encouraged to consult their tax advisors with respect to the consequences to them.

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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.

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.” For the purposes of this limitation, our adjusted taxable income is computed without regard to any business interest expense or business interest income, and in the case of taxable years beginning before January 1, 2022, any deduction allowable for depreciation, amortization, or depletion to the extent such depreciation, amortization, or depletion is not capitalized into cost of goods sold with respect to inventory.

If our “business interest” is subject to limitation under these rules, our unitholders will be limited in their

ability to deduct their share of any interest expense that has been allocated to them.

How ever, subject to the exceptions in the Coronavirus Aid, Relief, and Economic Security Act (the "CARES Act," discussed below), under the Tax Cuts and Jobs Act, for taxable years beginning after December 31, 2017, our deduction for “business int erest” is limited to the sum of our business interest income and 30% of our “adjusted taxable income.” For the purposes of this limitation, our adjusted taxable income is computed without regard to any business interest expense or business interest income, and in the case of taxable years beginning before January 1, 2022, any deduction allowable for depreciation, amortization, or depletion to the extent such depreciation, amortization, or depletion is not

capitalized into cost of goods sold with respect to inventory.

If our “business interest” is subject to limitation under these rules, our unitholders will be limited in their ability to deduct their share of any interest expense that has been allocated to them.

As a result, unitholders may be subject to limitation on their ability to deduct interest expense incurred by us.

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.

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.

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.

The remaining 50% of such unitholder’s excess business interest is carried forward and subject to the same limitations as other taxable years.

Tax-exempt entities face unique tax issues from owning our units that may result in adverse tax consequences to them.

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unitholders are generally taxed and subject to income tax filing requirements by the United States on income effectively connected with a U.S.

trade or business (“effectively connected income”).

trade or business.

Income allocated to our unitholders and any gain from the sale of our units will generally be considered to be “effectively connected” with a U.S.

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Moreover, the transferee of an interest in a partnership that is engaged in a U.S.

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, and we are required to deduct and withhold from the transferee amounts that should have been withheld by the transferees but were not withheld.

Because the “amount realized” includes a partner’s share of the partnership’s liabilities, 10% of the amount realized could exceed the total cash purchase price for the units.

However, pending the issuance of final regulations, the IRS has suspended the application of this withholding rule to transfers of publicly traded interests in publicly traded partnerships.

If recently promulgated regulations are finalized as proposed, such regulations would provide, with respect to transfers of publicly traded interests in publicly traded partnerships effected through a broker, that the obligation to withhold is imposed on the transferor’s broker and that a partner’s “amount realized” does not include a partner’s share of a publicly traded partnership’s liabilities for purposes of determining the amount subject to withholding.

However, it is not clear when such regulations will be finalized and if they will be finalized in their current form.

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” generally includes any decrease of a partner’s share of the partnership’s liabilities, recently issued 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.

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.

Prospective foreign unitholders should consult their tax advisors regarding the impact of these rules on an investment in our common units.

We will treat each purchaser of our common units as having the same tax benefits without regard to the actual common units purchased.

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In determining the items of income, gain, loss and deduction allocable to our unitholders, including when we issue additional units, we must determine the fair market value of our assets.

Although we may from time to time consult with professional appraisers regarding valuation matters, we make many fair market value estimates using a methodology based on the market value of our

common units as a means to measure the fair market value of our assets.

Although we may from time to time consult with professional appraisers regarding valuation matters, we make many fair market value estimates using a methodology based on the market value of our common units as a means to measure the fair market value of our assets.

The IRS may challenge these valuation methods and the resulting allocations of income, gain, loss and deduction.

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Unitholders should consult with their own tax advisors regarding the filing of such tax returns, the payment of such taxes, and the deductibility of any taxes paid.

General Risks

Our business is subject to cybersecurity risks.

Our business is increasingly dependent on information technologies and services.

Threats to information technology systems associated with cybersecurity risks and cyber incidents or attacks continue to grow.

We do not presently maintain insurance coverage to protect against cybersecurity risks.

If we procure such coverage in the future, we cannot ensure that it will be sufficient to cover any particular losses we may experience as a result of such cyber-attacks.

Any cyber incident could have a material adverse effect on our business, financial condition and results of operations.

The ongoing COVID-19 pandemic has adversely affected our business and may continue to do so.

The COVID-19 pandemic may also have the effect of heightening many of the other risks described elsewhere in this Item 1A, “Risk Factors.” The extent to which the COVID-19 pandemic adversely affects our business, results of operations, and financial condition will depend on future developments, which remain highly uncertain and cannot be predicted, including the scope and duration of the pandemic and actions taken by governmental authorities and other third parties in response to the pandemic.

UNRESOLVED STAFF COMMENTS

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

What changed 10-K

Item 1A. Risk Factors