What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2022-03-15 compared with 2021-03-15 · 199 added, 300 removed, 844 unchanged (37% of the section changed)

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INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

Report of Ernst & Young LLP, Independent Registered Public Accounting Firm

Report of Deloitte & Touche, LLP, Independent Registered Public Accounting Firm

Report of Ernst & Young LLP, Independent Registered Public Accounting Firm (PCAOB ID 42 )

Report of Deloitte & Touche, LLP, Independent Registered Public Accounting Firm (PCAOB ID 34 )

Consolidated Balance Sheets as of December 31, 2021 and 2020

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generally accepted accounting principles.

We did not audit the financial statements of Ciner Wyoming LLC (Ciner Wyoming), a limited liability company in which the Partnership has a 49% interest.

In the consolidated financial statements, the Partnership’s investment in Ciner Wyoming is stated at $263 million and $263 million as of December 31, 2020 and 2019, respectively, and the Partnership’s equity in the net income of Ciner Wyoming is stated at $11 million in 2020, $47 million in 2019 and $48 million in 2018.

Those statements were audited by other auditors whose report has been furnished to us, and our opinion, insofar as it relates to the amounts included for Ciner Wyoming, is based solely on the report of the other auditors.

We did not audit the financial statements of Sisecam Wyoming LLC (Sisecam Wyoming), a limited liability company in which the Partnership has a 49% interest.

In the consolidated financial statements, the Partnership’s investment in Sisecam Wyoming is stated at $276 million and $263 million as of December 31, 2021 and 2020, respectively, and the Partnership’s equity in the net income of Sisecam Wyoming is stated at $22 million in 2021, $11 million in 2020 and $47 million in 2019.

Those statements were audited by other auditors whose report has been furnished to us, and our opinion, insofar as it relates to the amounts included for Sisecam Wyoming, is based solely on the report of the other auditors.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Partnership's internal control over financial reporting as of December 31, 2021, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated March 15, 2022 expressed an unqualified opinion thereon.

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The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the account or disclosure to which it relates.

Impairment Assessment of Mineral Rights and Intangible Assets

Description of the Matter At December 31, 2020, the Partnership's Mineral Rights, net and Intangible assets, net totaled a combined $478 million.

During 2020, the Partnership recorded $136 million of mineral rights impairment expense.

As more fully described in Note 2 to the consolidated financial statements, the Partnership evaluates its long-lived assets for possible impairment periodically or whenever events or changes in circumstances indicate an asset's net book value may not be recoverable ("triggering events").

If deemed to be impaired, impairment is measured based on the estimated fair value, usually determined using the present value of projected future cash flows, compared to the asset’s book value.

Auditing the Partnership's impairment assessment involved our subjective judgment because, in determining the fair value of assets, management uses estimates that include, among others, assumptions about forecasted coal and aggregates prices and future production using mineral reserve or other relevant information reported by the third-party mine operators.

Significant uncertainty exists with these assumptions, given the long term nature of the forecast period and estimation of future market prices.

How We Addressed the Matter in Our Audit We obtained an understanding, evaluated the design and tested the operating effectiveness of controls over the Partnership’s impairment review process, including the processes to determine the fair value of the asset groups.

This included evaluating controls over the Partnership's budgetary and forecasting process used to develop the estimated future cash flows.

We also tested controls over management's review of the data used in the impairment analysis and review of the significant assumptions such as forecasted production and pricing.

To test the estimated fair value of the assets, we performed audit procedures that included, among others, assessing methodologies and testing significant assumptions.

We compared forecasted coal and aggregates prices to available market information and compared royalty rate inputs to customer contracts.

We tested production estimates through corroborating reserve information and mining plans to available third-party mine operators or publicly available information.

We considered possible contradictory information by comparing to historical results and projections utilized in other management analyses for going concern and estimated credit losses.

Impairment Assessment of Mineral Rights

Description of the Matter At December 31, 2021, the Partnership’s mineral rights, net totaled a combined $438 million.

As described in Note 2 to the consolidated financial statements, the Partnership evaluates its mineral rights for possible impairment whenever events or changes in circumstances indicate that the carrying amounts of the asset may not be recoverable (“triggering events”).

Management evaluates various qualitative factors in determining whether or not events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.

Potential events or circumstances include but are not limited to reduction in economically recoverable reserves or production ceasing on a property for an extended period, and other relevant information received from the operators, which may include operational or legal information that indicates production from mineral interests will not likely occur or may be significantly reduced in the future.

Auditing the Partnership’s impairment triggers assessment involved our subjective judgment because, in determining whether a triggering event occurred, significant uncertainty exists with judgments management utilizes regarding the likelihood of future production and the likelihood of potential contract renewals or modifications, which rely on reserve or other relevant information reported by the operators.

How We Addressed the Matter in Our Audit We obtained an understanding, evaluated the design, and tested the operating effectiveness of controls over the Partnership’s impairment assessment process.

We tested controls over the Partnership’s process for identifying and evaluating potential triggers of impairment and related significant judgments.

To test the Partnership’s impairment assessment, our audit procedures included, among others, making inquiries of management (including personnel in operations) to understand changes in business, and evaluating the significant judgments and operating data used in the Partnership’s assessment.

Specifically, we corroborated reserve information to reserve studies when available.

Additionally, we inspected the cancellation or significant modification of royalty-based lease contracts.

We searched for and evaluated other publicly available information, such as legislative or regulatory changes and bankruptcy filings, that corroborates or contradicts management’s assessment.

/s/ Ernst & Young LLP

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To the Board of Managers and Members of

Ciner Wyoming LLC

Sisecam Wyoming LLC

Atlanta, Georgia

Opinion on the Financial Statements

We have audited the accompanying balance sheets of Ciner Wyoming LLC (the "Company") as of December 31, 2020 and 2019, the related statements of operations and comprehensive income, members' equity, and cash flows for each of the three years in the period ended December 31, 2020, and the related notes that are included in Exhibit 99.1 (collectively referred to as the "financial statements").

We have audited the accompanying balance sheets of Sisecam Wyoming LLC (the "Company") as of December 31, 2021 and 2020, the related statements of operations and comprehensive income, members' equity, and cash flows for each of the three years in the period ended December 31, 2021, and the related notes that are included in Exhibit 99.1 (collectively referred to as the "financial statements").

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2021 and 2020, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2021, in conformity with accounting principles generally accepted in the United States of America.

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Critical Audit Matter Description

The Company is a subsidiary in a global group structure and agreements directly between the Company and other affiliates, or indirectly between affiliates that the Company does not control, can have a significant impact on recorded amounts or disclosures in the Company's financial statements, including any commitments and contingencies between the Company and affiliates or, potentially, third parties.

Performing audit procedures to evaluate the Company’s identification of upstream affiliate relationships, transactions, and commitments and contingencies outside of the U.S.

and the impact of such matters on the financial statements represents a critical audit matter because of the increased auditor judgment necessary to perform audit procedures related to these matters and evaluate the results of those procedures.

The Company is a subsidiary and investee within two different global group structures and agreements directly between the Company and affiliates, or indirectly between affiliates that the Company does not control, can have a significant impact on recorded amounts or disclosures in the Company's financial statements, including any commitments and contingencies between the Company and affiliates or, potentially, third parties.

Performing audit procedures to evaluate the Company’s identification of upstream affiliate relationships, transactions, and commitments and contingencies originating outside of the Ciner Enterprises, Inc.

group and the impact of such matters on the financial statements represents a critical audit matter because of the increased auditor judgment necessary to perform audit procedures related to these matters and evaluate the results of those procedures.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to the Company’s identification of upstream affiliate relationships, transactions, and commitments and contingencies outside of the U.S.

and the impact of such matters on the financial statements included the following, among others:

• We tested the effectiveness of controls over the Company’s affiliate process, including controls over the identification of the Company’s affiliate relationships, transactions, and commitments and contingencies outside of the U.S.

• We read publicly available financial filings and news sources related to the Company and its affiliates outside of the U.S.

and listened to the parent company (Ciner Resources LP) quarterly investor relations calls for information related to potential new affiliates and transactions between the Company and affiliates.

• We inspected director and executive officer questionnaires from the parent company directors and officers to identify any affiliate matters.

Our audit procedures related to the Company’s identification of upstream affiliate relationships, transactions, and commitments and contingencies outside of the Ciner Enterprises, Inc.

group and the impact of such matters on the financial statements included the following, among others:

• We read publicly available financial filings and news sources related to the Company and its affiliates outside of the Ciner Enterprises, Inc.

group and listened to the parent company (Sisecam Resources LP) quarterly investor relations calls for information related to potential new affiliates and transactions between the Company and affiliates.

• We inspected director and executive officer questionnaires from the Sisecam Resources LP's directors and officers to identify any affiliate matters.

• We searched the general ledger for potential transactions with affiliates.

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• We inquired of executive officers, key members of management, and the Board of Managers regarding affiliate relationships, transactions and commitments and contingencies.

• We confirmed with the ultimate parent company that the affiliate relationships, transactions, and commitments and contingencies identified and disclosed by the Company were complete.

• We confirmed with the Company's ultimate parent companies that the affiliate relationships, transactions, and commitments and contingencies identified and disclosed by the Company were complete.

/s/ Deloitte & Touche LLP

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Other current assets, net 2,723 5,080

Current assets of discontinued operations — 1,706

Total current assets $ 162,781 $ 117,192

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Current portion of long-term debt, net 39,102 39,055

Current liabilities of discontinued operations — 65

Total current liabilities $ 64,385 $ 61,372

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Class A Convertible Preferred Units ( 269,321 and 253,750 units issued and outstanding at December 31, 2021 and 2020, respectively, at $ 1,000 par value per unit;

liquidation preference of $ 1,700 per unit and $ 1,500 per unit at December 31, 2020 and 2019, respectively)

liquidation preference of $ 1,850 per unit at December 31, 2021 and $ 1,700 per unit per unit at December 31, 2020)

$ 183,908 $ 168,337

Partners’ capital

Common unitholders’ interest ( 12,261,199 units issued and outstanding at December 31, 2020 and 2019)

Common unitholders’ interest ( 12,351,306 and 12,261,199 units issued and outstanding at December 31, 2021 and 2020, respectively)

$ 203,062 $ 136,927

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Warrant holders’ interest 47,964 66,816

Accumulated other comprehensive income (loss) 322 ( 2,594 )

Accumulated other comprehensive income 3,211 322

Total partners' capital $ 256,024 $ 204,524

Non-controlling interest — ( 2,935 )

Total capital $ 204,524 $ 336,028

Total liabilities and capital $ 921,877 $ 1,085,907

Total liabilities and partners' capital $ 953,823 $ 921,877

The accompanying notes are an integral part of these consolidated financial statements.

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Revenues and other income

Coal royalty and other $ 120,166 $ 191,069 $ 178,878

Royalty and other mineral rights $ 185,196 $ 120,166 $ 191,069

Transportation and processing services 9,052 8,845 19,279

Equity in earnings of Ciner Wyoming 10,728 47,089 48,306

Gain on litigation settlement — — 25,000

Equity in earnings of Sisecam Wyoming 21,871 10,728 47,089

Gain on asset sales and disposals 245 581 6,498

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Net income (loss) from continuing operations $ 108,902 $ ( 84,819 ) $ ( 25,414 )

Income from discontinued operations (see Note 20) — 956 17,687

Income from discontinued operations — — 956

Net income (loss) $ 108,902 $ ( 84,819 ) $ ( 24,458 )

Net income attributable to non-controlling interest — — ( 510 )

Net income (loss) attributable to NRP $ ( 84,819 ) $ ( 24,458 ) $ 139,537

income attributable to preferred unitholders ( 31,609 ) ( 30,225 ) ( 30,000 )

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Net income (loss) $ 108,902 $ ( 84,819 ) $ ( 24,458 )

Comprehensive income (loss) from unconsolidated investment and other 2,916 868 ( 149 )

Comprehensive income from unconsolidated investment and other 2,889 2,916 868

Comprehensive income (loss) $ 111,791 $ ( 81,903 ) $ ( 23,590 )

Comprehensive income attributable to non-controlling interest — — ( 510 )

Comprehensive income (loss) attributable to NRP $ ( 81,903 ) $ ( 23,590 ) $ 139,388

The accompanying notes are an integral part of these consolidated financial statements.

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Balance at December 31, 2018 12,249 $ 355,113 $ 5,014 $ 66,816 $ ( 3,462 ) $ 423,481 $ ( 2,935 ) $ 420,546

Cumulative effect of adoption of accounting standard — 69,057 1,409 — — 70,466 — 70,466

Net income (1)

— ( 23,969 ) ( 489 ) — — ( 24,458 ) — ( 24,458 )

Distributions to common unitholders and general partner — ( 22,036 ) ( 450 ) — — ( 22,486 ) — ( 22,486 )

Distributions to common unitholders and the general partner — ( 32,487 ) ( 663 ) — — ( 33,150 ) — ( 33,150 )

Distributions to preferred unitholders — ( 29,400 ) ( 600 ) — — ( 30,000 ) — ( 30,000 )

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Balance at December 31, 2019 12,261 $ 271,471 $ 3,270 $ 66,816 $ ( 2,594 ) $ 338,963 $ ( 2,935 ) $ 336,028

Cumulative effect of adoption of accounting standard — ( 3,833 ) ( 78 ) — — ( 3,911 ) — ( 3,911 )

— ( 83,123 ) ( 1,696 ) — — ( 84,819 ) — ( 84,819 )

Distributions to common unitholders and general partner — ( 32,487 ) ( 663 ) — — ( 33,150 ) — ( 33,150 )

Distributions to common unitholders and the general partner — ( 16,552 ) ( 338 ) — — ( 16,890 ) — ( 16,890 )

Distributions to preferred unitholders — ( 29,511 ) ( 602 ) — — ( 30,113 ) — ( 30,113 )

Issuance of unit-based awards 12 486 — — — 486 — 486

Acquisition of non-controlling interest in BRP — ( 4,747 ) ( 97 ) — — ( 4,844 ) 2,935 ( 1,909 )

Unit-based awards amortization and vesting — 3,222 — — — 3,222 — 3,222

Comprehensive income (loss) from unconsolidated investment and other — ( 76 ) 8 — 868 800 — 800

Comprehensive income from unconsolidated investment and other — — — — 2,916 2,916 — 2,916

Balance at December 31, 2020 12,261 $ 136,927 $ 459 $ 66,816 $ 322 $ 204,524 $ — $ 204,524

Cumulative effect of adoption of accounting standard (See Note 18) — ( 3,833 ) ( 78 ) — — ( 3,911 ) — ( 3,911 )

Net income (3)

— 106,724 2,178 — — 108,902 — 108,902

Distributions to common unitholders and general partner — ( 16,552 ) ( 338 ) — — ( 16,890 ) — ( 16,890 )

Distributions to common unitholders and the general partner — ( 22,192 ) ( 453 ) — — ( 22,645 ) — ( 22,645 )

Distributions to preferred unitholders — ( 30,519 ) ( 623 ) — — ( 31,142 ) — ( 31,142 )

Acquisition of non-controlling interest in BRP — ( 4,747 ) ( 97 ) — — ( 4,844 ) 2,935 ( 1,909 )

Issuance of unit-based awards 90 — — — — — — —

Unit-based awards amortization and vesting — 2,647 — — — 2,647 — 2,647

Capital contribution — — 32 — — 32 — 32

Warrant settlement — 9,475 194 ( 18,852 ) — ( 9,183 ) — ( 9,183 )

Comprehensive income from unconsolidated investment and other — — — — 2,889 2,889 — 2,889

Balance at December 31, 2021 12,351 $ 203,062 $ 1,787 $ 47,964 $ 3,211 $ 256,024 $ — $ 256,024

(1) Net income (loss) includes $ 30.0 million of income attributable to preferred unitholders that accumulated during the period, of which $ 29.4 million is allocated to the common unitholders and $ 0.6 million is allocated to the general partner.

(1) Net loss includes $ 30.0 million of income attributable to preferred unitholders that accumulated during the period, of which $ 29.4 million is allocated to the common unitholders and $ 0.6 million is allocated to the general partner.

(2) Net loss includes $ 30.2 million of income attributable to preferred unitholders that accumulated during the period, of which $ 29.6 million is allocated to the common unitholders and $ 0.6 million is allocated to the general partner.

(3) Net income includes $ 31.6 million of income attributable to preferred unitholders that accumulated during the period, of which $ 31.0 million is allocated to the common unitholders and $ 0.6 million is allocated to the general partner.

The accompanying notes are an integral part of these consolidated financial statements.

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Cash flows from investing activities

Distributions from unconsolidated investment in excess of cumulative earnings $ — $ — $ 2,097

Proceeds from asset sales and disposals $ 249 $ 623 $ 6,500

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Net cash provided by investing activities of continuing operations $ 2,412 $ 1,745 $ 8,221

Net cash provided by (used in) investing activities of discontinued operations ( 65 ) ( 629 ) 183,021

Net cash used in investing activities of discontinued operations — ( 65 ) ( 629 )

Net cash provided by investing activities $ 2,412 $ 1,680 $ 7,592

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Debt repayments ( 39,396 ) ( 46,176 ) ( 463,082 )

Redemption of preferred units paid-in-kind — — ( 8,844 )

Distributions to common unitholders and general partner ( 16,890 ) ( 33,150 ) ( 22,486 )

Distributions to common unitholders and the general partner ( 22,645 ) ( 16,890 ) ( 33,150 )

Distributions to preferred unitholders ( 15,571 ) ( 26,363 ) ( 30,000 )

Warrant settlement ( 9,183 ) — —

Acquisition of non-controlling interest in BRP ( 1,000 ) — —

Contributions from (to) discontinued operations — 1,641 ( 637 )

Debt issuance costs and other — ( 26,436 ) ( 228 )

Other items ( 691 ) — ( 26,436 )

Net cash used in financing activities of continuing operations $ ( 88,486 ) $ ( 87,788 ) $ ( 253,305 )

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Net cash used in financing activities $ ( 88,486 ) $ ( 89,429 ) $ ( 252,668 )

Net increase (decrease) in cash and cash equivalents $ 35,730 $ 1,525 $ ( 107,765 )

Cash and cash equivalents of continuing operations at beginning of period 99,790 98,265 206,030

Cash and cash equivalents at end of period $ 135,520 $ 99,790 $ 98,265

NATURAL RESOURCE PARTNERS L.P.

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(In thousands) 2021 2020 2019

Net increase (decrease) in cash and cash equivalents $ 1,525 $ ( 107,765 ) $ 176,203

Cash and cash equivalents of continuing operations at beginning of period $ 98,265 $ 206,030 $ 26,980

Cash and cash equivalents of discontinued operations at beginning of period — — 2,847

Cash and cash equivalents at beginning of period $ 98,265 $ 206,030 $ 29,827

Cash and cash equivalents of continuing operations at end of period $ 99,790 $ 98,265 $ 206,030

cash and cash equivalents of discontinued operations at end of period — — —

Cash and cash equivalents at end of period $ 99,790 $ 98,265 $ 206,030

Supplemental cash flow information:

Cash paid during the period for interest $ 39,830 $ 58,597 $ 64,991

Cash paid for interest $ 37,378 $ 39,830 $ 58,597

Non-cash investing and financing activities:

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The general partner of the Partnership is NRP (GP) LP ("NRP GP"), a Delaware limited partnership, whose general partner is GP Natural Resource Partners LLC, a Delaware limited liability company.

The Partnership engages principally in the business of owning, managing and leasing a diversified portfolio of mineral properties in the United States, including interests in coal and other natural resources and owns a non-controlling 49 % interest in Ciner Wyoming LLC ("Ciner Wyoming"), a trona ore mining and soda ash production business.

The Partnership engages principally in the business of owning, managing and leasing a diversified portfolio of mineral properties in the United States, including interests in coal and other natural resources and owns a non-controlling 49 % interest in Sisecam Wyoming LLC ("Sisecam Wyoming"), formerly known as Ciner Wyoming, a trona ore mining and soda ash production business.

The Partnership is organized into two operating segments further described in Note 7.

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Robertson, Jr., owns all of the membership interest in GP Natural Resource Partners LLC.

Subject to the Board Representation and Observation Rights Agreement with certain entities controlled by funds affiliated with The Blackstone Group Inc.

Subject to the Board Representation and Observation Rights Agreement with certain entities controlled by funds affiliated with Blackstone Inc.

(collectively referred to as "Blackstone") and affiliates of GoldenTree Asset Management LP (collectively referred to as "GoldenTree"), RCM is entitled to appoint the directors of the Board of Directors of GP Natural Resource Partners LLC (the "Board of Directors").

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and its wholly owned subsidiaries.

The Partnership has an equity investment in Ciner Wyoming through which it is able to exercise significant influence over but does not control the investee and is not the primary beneficiary of the investee’s activities and is accounted for using the equity method.

The Partnership has an equity investment in Sisecam Wyoming through which it is able to exercise significant influence over but does not control the investee and is not the primary beneficiary of the investee’s activities and is accounted for using the equity method.

Intercompany transactions and balances have been eliminated.

Certain reclassifications have been made to prior year amounts in the Notes to Consolidated Financial Statements to conform with current year presentation.

These reclassifications had no impact on previously reported total assets, total liabilities, partners' capital, net income (loss) or cash flows from operating, investing or financing activities.

Use of Estimates

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Actual results could differ from those estimates.

The most significant estimates pertain to coal and aggregates reserves and related cash flow estimates which are used to compute depreciation, depletion and amortization and impairments of coal and aggregates properties and related intangible assets and commitments and contingencies.

The most significant estimates pertain to coal and aggregates mineral rights and related cash flow estimates which are used to compute depreciation, depletion and amortization and impairments of coal and aggregates properties and related intangible assets and commitments and contingencies.

The Partnership discloses certain assets and liabilities using fair value as defined by authoritative guidance.

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Fair Value Measurements for further details.

NATURAL RESOURCE PARTNERS L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

There are three levels of inputs that may be used to measure fair value:

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or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

NATURAL RESOURCE PARTNERS L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

• Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

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Receivables are written off when collection efforts are exhausted and future recovery is doubtful.

Beginning January 1, 2020 upon adoption of ASU No.

The Partnership includes an allowance for current expected credit losses ("CECL") on its financial assets based on the loss-rate method.

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The total allowance related to short-term notes receivables included in other current assets, net on the Partnership's Consolidated Balance Sheets was $ 0.1 million and $ 0.6 million at December 31, 2021 and 2020, respectively.

The total allowance related to the Partnership's long-term financing receivable included in long-term contract receivable, net on the Consolidated Balance Sheets was $ 1.6 million at December 31, 2020.

The Partnership recorded bad debt expense of $ 4.0 million, $ 7.5 million and $( 0.1 ) million included in operating and maintenance expenses on its Consolidated Statements of Comprehensive Income (Loss) for the years ended December 31, 2020, 2019 and 2018, respectively.

The total allowance related to the Partnership's long-term financing receivable included in long-term contract receivable, net on the Consolidated Balance Sheets was $ 1.1 million and $ 1.6 million at December 31, 2021 and 2020, respectively.

The Partnership recorded bad debt expense of $ 2.6 million, $ 4.0 million and $ 7.5 million included in operating and maintenance expenses on its Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2021, 2020 and 2019, respectively.

Mineral Rights

Mineral rights owned and leased are recorded at its original cost of construction or, upon acquisition, at fair value of the assets acquired.

Coal and aggregates mineral rights are depleted on a unit-of-production basis by lease, based upon minerals mined in relation to the net cost of the mineral properties and estimated proven and probable tonnage therein.

Intangible Assets

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The estimated fair value of the above-market rate contracts are determined based on the present value of future cash flow projections related to the underlying assets acquired.

Intangible assets are amortized on a unit-of-production basis by asset based upon minerals mined or transported in relation to the net book value of the intangible asset and estimated proven and probable tonnage expected to be mined or transported during the above-market contract term.

Intangible assets are amortized on a unit-of-production basis by asset based upon minerals mined or transported in relation to the net book value of the intangible asset and estimated economic tonnage expected to be mined or transported during the above-market contract term.

Asset Impairment

The Partnership has developed procedures to evaluate its long-lived assets, including intangible assets, for possible impairment periodically or whenever events or changes in circumstances indicate an asset's net book value may not be recoverable.

Potential events or circumstances include, but are not limited to, specific events such as a reduction in economically recoverable reserves or production ceasing on a property for an extended period.

This analysis is based on historic, current and future performance and considers both quantitative and qualitative information.

Potential events or circumstances include, but are not limited to, specific events such as a reduction in economically recoverable tons or production ceasing on a property for an extended period.

This analysis is based on historic,

NATURAL RESOURCE PARTNERS L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

current and future performance and considers both quantitative and qualitative information.

A long-lived asset is deemed impaired when the future expected undiscounted cash flows from its use and disposition is less than the asset's net book value.

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The Partnership believes its estimates of cash flows and discount rates are consistent with those of principal market participants.

NATURAL RESOURCE PARTNERS L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

The Partnership evaluates its equity investment for impairment when events or changes in circumstances indicate, in management’s judgment, that the carrying value of such investment may have experienced an other-than-temporary decline in value.

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Accrued Liabilities

Included in accrued liabilities on the Partnership's Consolidated Balance Sheets at December 31, 2020 were $ 3.7 million of accrued employee costs and $ 4.0 million of other accrued liabilities, which primarily includes property taxes.

Included in accrued liabilities on the Partnership's Consolidated Balance Sheets at December 31, 2021 were $ 7.7 million of accrued employee costs and $ 2.6 million of other accrued liabilities, which includes property taxes.

These amounts were $ 3.7 million and $ 4.0 million of accrued employee costs and other accrued liabilities, respectively, at December 31, 2020.

Other accrued liabilities at December 31, 2019 primarily included property taxes and disputed well liabilities.

Other accrued liabilities at December 31, 2020 primarily included property taxes.

Revenue Recognition

Coal Royalty and Other Segment Revenues

Mineral Rights Segment Revenues

Royalty-based leases.

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Leases for which the Partnership expects that consideration from production will be greater than consideration from minimums over the lease term.

Revenue recognition for these leases is recognized over time based on production as coal royalty revenues or aggregates royalty revenues, as applicable.

Revenue for these leases is recognized over time based on production as royalty revenues, as applicable.

Deferred revenue from minimums is recognized as royalty revenues when recoupment occurs or as production lease minimum revenues when the recoupment period expires.

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Leases for which the Partnership expects that consideration from minimums will be greater than consideration from production over the lease term.

Revenue recognition for these leases is recognized straight-line over the lease term based on the minimum consideration amount as minimum lease straight-line revenues.

Revenue for these leases is recognized straight-line over the lease term based on the minimum consideration amount as minimum lease straight-line revenues.

This evaluation is performed at the inception of the lease and only reassessed upon modification or renewal of the lease.

Oil and gas related revenues consist of revenues from royalties and overriding royalties and are recognized on the basis of volume of hydrocarbons sold by lessees and the corresponding revenues from those sales.

Also, included within oil and gas royalty revenues are lease bonus payments, which are generally paid upon the execution of a lease.

The Partnership also has overriding royalty revenue interests in coal reserves.

Revenues from these interests are recognized over time based on when the coal is sold.

NATURAL RESOURCE PARTNERS L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

Also, included within oil and gas royalty revenues are lease bonus payments, which are generally paid upon the execution of a lease.

The Partnership also has overriding royalty revenue interests in certain coal mineral rights.

Revenue from these interests is recognized over time based on when the coal is sold.

Forest CO 2 sequestration revenues.

Revenues related to the sale of NRP's carbon offset credits that are recognized at a point in time upon execution of the transaction.

Wheelage revenues.

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Other revenues.

Other revenues consists primarily of rental payments and surface damage fees related to certain land owned by the Partnership and is recognized straight-line over time as it is earned.

Other revenues consists primarily of rental payments and surface damage fees related to certain land owned by the Partnership and are recognized straight-line over time as it is earned.

Other revenues also include property tax revenues.

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Consideration received to assign a lease to another party and related forfeited minimums will be recognized immediately upon the termination of the contract.

Fees from contract modifications are recognized in lease amendment revenues within coal royalty and other revenues on the Consolidated Statements of Comprehensive Income (Loss) while modifications in royalty rates and minimums will be recognized prospectively in accordance with the above lease classification.

Fees from contract modifications are recognized in lease amendment revenues within royalty and other mineral rights revenues on the Consolidated Statements of Comprehensive Income (Loss) while modifications in royalty rates and minimums will be recognized prospectively in accordance with the above lease classification.

Contract Assets and Liabilities from Contracts with Customers

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Due to uncertainty in the amount of deferred revenue that will be recouped and recognized as coal royalty revenues from its production leases over the next twelve months, the Partnership is unable to estimate the current portion of deferred revenue.

Equity in Earnings of Ciner Wyoming

NATURAL RESOURCE PARTNERS L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

Equity in Earnings of Sisecam Wyoming

The Partnership accounts for non-marketable equity investments using the equity method of accounting if the investment gives it the ability to exercise significant influence over, but not control of, an investee.

The Partnership's 49 % investment in Ciner Wyoming is accounted for using this method.

The Partnership's 49 % investment in Sisecam Wyoming is accounted for using this method.

Under the equity method of accounting, investments are stated at initial cost and are adjusted for subsequent additional investments and the proportionate share of earnings or losses and distributions.

The basis difference between the investment and the proportional share of investee's net assets is attributed to net tangible assets and is amortized over its estimated useful life.

The carrying value in Ciner Wyoming is recognized in equity in unconsolidated investment on the Partnership's Consolidated Balance Sheets.

The Partnership's adjusted share of the earnings or losses of Ciner Wyoming and amortization of the basis difference is recognized in equity in earnings of Ciner Wyoming on the Consolidated Statements of Comprehensive Income (Loss).

The Partnership decreases its investment for its proportional share of distributions received from Ciner Wyoming.

The carrying value in Sisecam Wyoming is recognized in equity in unconsolidated investment on the Partnership's Consolidated Balance Sheets.

The Partnership's adjusted share of the earnings or losses of Sisecam Wyoming and amortization of the basis difference is recognized in equity in earnings of Sisecam Wyoming on the Consolidated Statements of Comprehensive Income (Loss).

The Partnership decreases its investment for its proportional share of distributions received from Sisecam Wyoming.

These cash flows are reported utilizing the cumulative earnings approach.

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The excess of cumulative distributions received over the Partnership's cumulative equity in earnings are considered returns of investment and classified as investing cash inflows.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

Property Taxes

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Typically, the lessees are contractually responsible for reimbursing the Partnership for property taxes on the leased properties.

The payment of and reimbursement of property taxes is included in operating and maintenance expenses and in coal royalty and other revenues, respectively, on the Consolidated Statements of Comprehensive Income (Loss).

The payment of and reimbursement of property taxes is included in operating and maintenance expenses and in royalty and other mineral rights revenues, respectively, on the Consolidated Statements of Comprehensive Income (Loss).

Unit-Based Compensation

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In the event of an examination of the Partnership’s tax return, the tax liability of the unitholders could be changed if an adjustment in the Partnership’s income is ultimately sustained by the taxing authorities.

Recently Adopted Accounting Standards

Credit Losses

On January 1, 2020, the Partnership adopted ASU No.

2016-13, Financial Instruments—Credit Losses (Topic 326), and all the related amendments ("the new credit loss standard").

The Partnership recognized a $ 3.9 million cumulative effect of adoption in the opening balance of partners' capital on January 1, 2020 as a result of the adoption of the new credit loss standard.

The new standard replaces today's "incurred loss" model with an "expected credit loss" model that requires entities to estimate an expected lifetime credit loss on financial assets, including trade accounts receivable.

Credit Losses for more information.

NATURAL RESOURCE PARTNERS L.P.

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Revenues from Contracts with Customers

The following table represents the Partnership's Coal Royalty and Other segment revenues by major source:

The following table represents the Partnership's Mineral Rights segment revenues by major source:

For the Year Ended December 31,

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Minimum lease straight-line revenues 20,564 16,796 14,910

Forest CO 2 sequestration revenues

Property tax revenues 6,028 5,786 6,287

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Other revenues 933 982 1,529

Coal royalty and other revenues

Royalty and other mineral rights revenues

$ 185,196 $ 120,166 $ 191,069

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9,052 8,845 19,279

Total coal royalty and other segment revenues $ 129,011 $ 210,348 $ 202,765

Total Mineral Rights segment revenues $ 194,248 $ 129,011 $ 210,348

(1) Transportation and processing services revenues from contracts with customers as defined under ASC 606 was $ 5.4 million, $ 5.0 million and $ 9.6 million for the year ended December 31, 2021, 2020 and 2019, respectively.

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Financing Transaction for more information.

The following table details the Partnership's Coal Royalty and Other segment receivables and liabilities resulting from contracts with customers:

The following table details the Partnership's Mineral Rights segment receivables and liabilities resulting from contracts with customers:

(In thousands) 2021 2020

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

The following table shows the activity related to the Partnership's Coal Royalty and Other segment deferred revenue:

The following table shows the activity related to the Partnership's Mineral Rights segment deferred revenue:

For the Year Ended December 31,

(In thousands) 2021 2020 2019

Balance at end of prior period (current and non-current) $ 51,821 $ 52,553 $ 100,605

Cumulative adjustment for change in accounting principle — — ( 65,591 )

Balance at beginning of period (current and non-current) $ 61,554 $ 51,821 $ 52,553

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(1) Lease term does not include renewal periods.

(2) Annual minimum payments do not include $ 19.3 million of the $ 40.0 million of annual fixed consideration owed to NRP in 2021 resulting from contract modifications entered into during the second quarter of 2020.

Additionally, $ 5.0 million of this remaining $ 19.3 million relates to a coal infrastructure lease that is accounted for as a financing transaction.

Financing Transaction for additional information.

Class A Convertible Preferred Units and Warrants

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Rather than have the preferred units convert to common units in accordance with the provisions of this paragraph, NRP would have the option to elect to redeem the preferred units proposed to be converted for cash at a price equal to the per unit purchase price plus the value of any accrued and unpaid distributions.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

On or after March 2, 2025, the holders of the preferred units may elect to convert the preferred units to common units at a conversion rate equal to the Liquidation Value divided by an amount equal to a 10 % discount to the VWAP for the 30 trading days immediately prior to the notice of conversion.

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and (2) the per unit purchase price plus the value of all accrued and unpaid distributions.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

To the extent the holders of the preferred units have not elected to convert their preferred units before March 2, 2029, NRP has the right to force conversion of the preferred units at a price equal to the liquidation value divided by an amount equal to a 10 % discount to the VWAP for the 30 trading days immediately prior to the notice of conversion.

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If the shelf registration statement to register the common units issuable upon conversion of the preferred units is not effective by the applicable registration deadline, NRP will be required to pay the preferred purchasers liquidated damages in the amounts and upon the term set forth in the preferred unit and warrant registration rights agreement.

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Accounting for the Preferred Units and Warrants

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The warrants are accounted for as equity on NRP's Consolidated Balance Sheets.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

Initial Measurement

The net transaction price as shown below was allocated to the preferred units and warrants based on their relative fair values at inception date.

The net transaction price was allocated to the preferred units and warrants based on their relative fair values at inception date.

NRP allocated the transaction issuance costs to the preferred units and warrants primarily on a pro-rata basis based on their relative inception date allocated values.

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(In thousands, except unit data) Units Outstanding Financial

Balance at December 31, 2017 258,844 $ 173,431

Redemption of PIK units ( 8,844 ) ( 8,844 )

Balance at December 31, 2018 and 2019 250,000 $ 164,587

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Balance at December 31, 2020 253,750 $ 168,337

Distributions paid-in-kind 15,571 15,571

Balance at December 31, 2021 269,321 $ 183,908

Subsequent adjustment of the warrants will not occur until the warrants are exercised, at which time, NRP may, at its option, elect to settle the warrants in common units or cash, each on a net basis.

The net basis will be equal to the difference between the Partnership's common unit price and the strike price of the warrant.

Once warrant exercise occurs, the difference between the carrying amount of the warrants and the net settlement amount will be allocated on a pro-rata basis to the common unitholders and general partner.

On November 10, 2021 (the "exercise date"), Blackstone exercised all of its 997,500 warrants with a strike price of $ 22.81 and NRP settled the warrants in cash on a net basis.

NRP delivered the net cash settlement amount of $ 9.2 million.

The 15-day VWAP ending on the business day prior to the exercise date was $ 32.02 .

Activity related to the warrants is as follows:

(In thousands, except warrant data) Warrants Outstanding Financial

Balance at December 31, 2018, 2019 and 2020 4,000,000 $ 66,816

Warrant settlement ( 997,500 ) ( 18,852 )

Balance at December 31, 2021 3,002,500 $ 47,964

Certain embedded features within the preferred unit and warrant purchase agreement are accounted for at fair value and are remeasured each quarter.

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Common and Preferred Unit Distributions

The Partnership makes cash distributions to common and preferred unitholders on a quarterly basis, subject to approval by the Board of Directors.

The Partnership makes distributions to common and preferred unitholders on a quarterly basis, subject to approval by the Board of Directors.

NRP recognizes both common unit and preferred unit distributions on the date the distribution is declared.

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The general partner is entitled to receive 2 % of such distributions.

Income (loss) available to common unitholders and the general partner is reduced by preferred unit distributions that accumulated during the period.

NRP reduced net income (loss) available to common unitholders and the general partner by $ 30.2 million during the year ended December 31, 2020 and $ 30.0 million during the years ended December 31, 2019 and 2018 as a result of accumulated preferred unit distributions earned during the period.

In May 2020, the Partnership paid in kind one-

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

half of the preferred unit distribution related to the three months ended March 31, 2020.

In June 2020, the Partnership redeemed all of the outstanding preferred units paid in kind.

Additionally, in November 2020, the Partnership paid in kind one-half of the preferred unit distribution related to the three months ended September 30, 2020.

During the three months ended March 31, 2018, the Partnership redeemed all of the outstanding PIK units related to the year ended December 31, 2017, which resulted in an $ 8.8 million cash payment during the year ended December 31, 2018.

This $ 8.8 million cash payment is not included in the table below.

The following table shows the cash distributions declared and paid to common and preferred unitholders during the years ended December 31, 2020, 2019 and 2018, respectively:

Income (loss) available to common unitholders and the general partner is reduced by preferred unit distributions that accumulated during the period.

NRP reduced net income (loss) available to common unitholders and the general partner by $ 31.6 million, $ 30.2 million and $ 30.0 million during the year ended December 31, 2021, 2020 and 2019, respectively as a result of accumulated preferred unit distributions earned during the period.

The following table shows the distributions declared and paid to common and preferred unitholders during the year

ended December 31, 2021, 2020 and 2019, respectively:

Cash Distributions Paid-in-kind Distributions

Common Units Preferred Units

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Distribution per Unit Total Distribution

(In thousands)

(In thousands) Total Distribution

February 2021 October 1 - December 31, 2020 $ 0.45 $ 5,630 $ 15.00 $ 3,806 3,806

May 2021 January 1 - March 31, 2021 0.45 5,672 15.00 3,864 3,864

June 2020 (2)

January 1 - March 31, 2020 — — 15.45 3,863

August 2021 April 1 - June 30, 2021 0.45 5,671 15.00 3,921 3,921

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May 2020 January 1 - March 31, 2020 — — 15.00 3,750 3,750

Special Distribution 0.85 10,635 — —

June 2020 (2)

January 1 - March 31, 2020 — — 15.45 3,863 —

August 2020 April 1 - June 30, 2020 0.45 5,630 30.00 7,500 —

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May 2019 January 1 - March 31, 2019 0.45 5,630 30.00 7,500 —

Special Distribution 0.85 10,635 — — —

August 2019 April 1 - June 30, 2019 0.45 5,630 30.00 7,500 —

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Net Income (Loss) Per Common Unit

Basic net income (loss) per common unit is computed by dividing net income (loss), after considering income attributable to non-controlling interest, preferred unitholders and the general partner’s general partner interest, by the weighted average number of common units outstanding.

Basic net income (loss) per common unit is computed by dividing net income (loss), after considering income attributable to preferred unitholders and the general partner’s general partner interest, by the weighted average number of common units outstanding.

Diluted net income (loss) per common unit includes the effect of NRP's preferred units, warrants, and unvested unit-based awards if the inclusion of these items is dilutive.

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for purposes of the if-converted calculation.

The calculation of diluted net loss per common unit for the years ended December 31, 2020 and 2019 do not include the assumed conversion of the preferred units because the impact would have been anti-dilutive.

The calculation of diluted net income per common unit for the year ended December 31, 2021 includes the assumed conversion of the preferred units.

The calculation of diluted net loss per common unit for the years ended December 31, 2020 and 2019 does not include the assumed conversion of the preferred units because the impact would have been anti-dilutive.

The dilutive effect of the warrants is calculated using the treasury stock method, which assumes that the proceeds from the exercise of these instruments are used to purchase common units at the average market price for the period.

Due to NRP's net loss during the years ended December 31, 2020 and 2019, the dilutive effect of the warrants were not included as the impact would have been anti-dilutive.

The calculation of the dilutive effect of the warrants for the year ended December 31, 2018 included the net settlement of warrants to purchase 1.75 million common units with a strike price of $ 22.81 but did not include the net settlement of warrants to purchase 2.25 million common units with a strike price of $ 34.00 because the impact would have been anti-dilutive.

The calculation of diluted net income per common unit for the year ended December 31, 2021 includes the net settlement of warrants to purchase 0.75 million common units with a strike price of $ 22.81 but does not include the net settlement of warrants to purchase 2.25 million common units with a strike price of $ 34.00 because the impact would have been anti-dilutive.

The calculation of diluted net loss per common unit for the years ended December 31, 2020 and 2019 does not include the net settlement of warrants to purchase 1.75 million common units with a strike price of $ 22.81 or the net settlement of warrants to purchase 2.25 million common units with a strike price of $ 34.00 because the impact would have been anti-dilutive.

The following tables reconcile the numerators and denominators of the basic and diluted net income (loss) per common unit computations and calculates basic and diluted net income (loss) per common unit:

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Net income (loss) from continuing operations $ 108,902 $ ( 84,819 ) $ ( 25,414 )

net income attributable to non-controlling interest — — ( 510 )

income attributable to preferred unitholders ( 31,609 ) ( 30,225 ) ( 30,000 )

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Net income (loss) $ 108,902 $ ( 84,819 ) $ ( 24,458 )

net income attributable to non-controlling interest — — ( 510 )

income attributable to preferred unitholders ( 31,609 ) ( 30,225 ) ( 30,000 )

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Net income (loss) from continuing operations $ 108,902 $ ( 84,819 ) $ ( 25,414 )

net income attributable to non-controlling interest — — ( 510 )

income attributable to preferred unitholders — ( 30,225 ) ( 30,000 )

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Net income (loss) $ 108,902 $ ( 84,819 ) $ ( 24,458 )

net income attributable to non-controlling interest — — ( 510 )

income attributable to preferred unitholders — ( 30,225 ) ( 30,000 )

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Diluted net income (loss) per common unit $ 4.81 $ ( 9.20 ) $ ( 4.35 )

NATURAL RESOURCE PARTNERS L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

Segment Information

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NRP has the following two operating segments:

Coal Royalty and Other —consists primarily of coal royalty properties and coal-related transportation and processing assets.

Other assets include industrial mineral royalty properties, aggregates royalty properties, oil and gas royalty properties and timber.

The Partnership's coal reserves are primarily located in Appalachia, the Illinois Basin and the Northern Powder River Basin in the United States.

The Partnership's industrial minerals and aggregates properties are located in various states across the United States.

The Partnership's oil and gas royalty assets are primarily located in Louisiana and its timber assets are primarily located in West Virginia.

Soda Ash —consists of the Partnership's 49 % non-controlling equity interest in Ciner Wyoming, a trona ore mining operation and soda ash refinery in the Green River Basin of Wyoming.

Ciner Wyoming mines trona and processes it into soda ash that is sold both domestically and internationally into the glass and chemicals industries.

Mineral Rights (formerly named Coal Royalty and Other segment) —c onsists of mineral interests and other subsurface rights across the United States.

NRP's ownership provides critical inputs for the manufacturing of steel, electricity and basic building materials, as well as opportunities for carbon sequestration and renewable energy.

The Partnership is working to strategically redefine its business as a key player in the transitional energy economy in the years to come.

Soda Ash —consists of the Partnership's 49 % non-controlling equity interest in Sisecam Wyoming, a trona ore mining operation and soda ash refinery in the Green River Basin of Wyoming.

Sisecam Wyoming mines trona and processes it into soda ash that is sold both domestically and internationally into the glass and chemicals industries.

Direct segment costs and certain other costs incurred at the corporate level that are identifiable and that benefit the Partnership's segments are allocated to the operating segments accordingly.

These allocated costs generally include salaries and benefits, insurance, property taxes, legal, royalty, information technology and shared facilities services and are included in operating and maintenance expenses on the Partnership's Consolidated Statements of Comprehensive Income (Loss).

Corporate and Financing includes functional corporate departments that do not earn revenues.

Costs incurred by these departments include interest and financing, corporate headquarters and overhead, centralized treasury, legal and accounting and other corporate-level activity not specifically allocated to a segment and are included in general and administrative expenses on the Partnership's Consolidated Statements of Comprehensive Income (Loss).

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

Corporate and Financing includes functional corporate departments that do not earn revenues.

The following table summarizes certain financial information for each of the Partnership's business segments:

Operating Segments

(In thousands) Coal Royalty and Other Soda Ash Corporate and Financing Total

(In thousands) Mineral Rights Soda Ash Corporate and Financing Total

For the Year Ended December 31, 2021

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As of December 31, 2021

Total assets of continuing operations $ 656,505 $ 262,514 $ 2,858 $ 921,877

Total assets $ 675,579 $ 276,004 $ 2,240 $ 953,823

For the Year Ended December 31, 2020

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Net income (loss) from continuing operations ( 40,180 ) 10,543 ( 55,182 ) ( 84,819 )

Income from discontinued operations — — — 956

As of December 31, 2020

Total assets of continuing operations $ 817,768 $ 263,080 $ 3,353 $ 1,084,201

Total assets of discontinued operations — — — 1,706

Total assets $ 656,505 $ 262,514 $ 2,858 $ 921,877

For the Year Ended December 31, 2019

Revenues $ 210,348 $ 47,089 $ — $ 257,437

Gain on litigation settlement 25,000 — — 25,000

Gain on asset sales and disposals 6,498 — — 6,498

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Equity Investment

The Partnership accounts for its 49 % investment in Ciner Wyoming using the equity method of accounting.

The Partnership accounts for its 49 % investment in Sisecam Wyoming using the equity method of accounting.

Activity related to this investment is as follows:

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Amortization of basis difference ( 5,108 ) ( 4,477 ) ( 4,927 )

Other comprehensive income (loss) 2,916 790 ( 138 )

Other comprehensive income 2,889 2,916 790

Distribution ( 11,270 ) ( 14,210 ) ( 31,850 )

Balance at end of period $ 276,004 $ 262,514 $ 263,080

(1) Includes reclassifications of accumulated other comprehensive loss to income allocation to NRP equity interest of $ 1.7 million, $ 0.6 million and $ 0.5 million for the year ended December 31, 2020, 2019 and 2018, respectively.

The difference between the amount at which the investment in Ciner Wyoming is carried and the amount of underly ing equity in Ciner Wyoming's net assets was $ 131.4 million and $ 135.8 million as of December 31, 2020 and 2019, respectively.

(1) Includes reclassifications of accumulated other comprehensive income (loss) to income allocation to NRP equity interest of $ 0.0 million , $ 1.7 million and $ 0.6 million for the year ended December 31, 2021, 2020 and 2019, respectively.

The difference between the amount at which the investment in Sisecam Wyoming is carried and the amount of underly ing equity in Sisecam Wyoming's net assets was $ 126.3 million and $ 131.4 million as of December 31, 2021 and 2020, respectively.

This excess basis relates to property, plant and equipment and right to mine assets.

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The excess basis difference that relates to right to mine assets is being amortized into income using the units of production method.

The following table represents summarized financial information for Ciner Wyoming as derived from their respective financial statements for the years ended December 31, 2020, 2019, and 2018:

The following table represents summarized financial information for Sisecam Wyoming as derived from their respective financial statements for the years ended December 31, 2021, 2020, and 2019:

For the Year Ended December 31,

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Net income 55,059 31,030 106,155

The financial position of Ciner Wyoming is summarized as follows:

The financial position of Sisecam Wyoming is summarized as follows:

(In thousands) 2021 2020

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Total mineral rights, net $ 704,902 $ ( 267,205 ) $ 437,697 $ 820,170 $ ( 359,797 ) $ 460,373

Depletion expense related to the Partnership’s mineral rights is included in depreciation, depletion and amortization on its Consolidated Statements of Comprehensive Income (Loss) and totaled $ 8.8 million, $ 12.1 million and $ 17.0 million for the years ended December 31, 2020, 2019 and 2018, respectively.

Depletion expense related to the Partnership’s mineral rights is included in depreciation, depletion and amortization on its Consolidated Statements of Comprehensive Income (Loss) and totaled $ 17.6 million, $ 8.8 million and $ 12.1 million for the year ended December 31, 2021, 2020 and 2019, respectively.

Sales of Mineral Rights

During the year ended December 31, 2020, the Partnership recorded a gain of $ 0.6 million included in gain on asset sales and disposals on the Consolidated Statements of Comprehensive Income (Loss) related to sales of multiple mineral reserves.

During the year ended December 31, 2019, the Partnership recorded a gain of $ 6.5 million included in gain on asset sales and disposals on the Consolidated Statements of Comprehensive Income (Loss) primarily related to the disposal of certain coal mineral rights with a $ 0 net book value.

During the year ended December 31, 2018, the Partnership recorded a cumulative gain of $ 2.4 million included in gain on asset sales and disposals on the Consolidated Statements of Comprehensive Income (Loss) related to sales of multiple mineral reserves.

During the year ended December 31, 2021 and 2020, the Partnership recorded a cumulative gain of $ 0.2 million and $ 0.6 million, respectively, included in gain on asset sales and disposals on the Consolidated Statements of Comprehensive Income (Loss) related to sales of certain mineral rights.

During the year ended December 31, 2019, the Partnership recorded a cumulative gain of $ 6.5 million included in gain on asset sales and disposals on the Consolidated Statements of Comprehensive Income (Loss) primarily related to the disposal of certain coal mineral rights with a $ 0 net book value.

Impairment of Mineral Rights

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87 21,583 103

$ 135,885 $ 125,909 $ 18,280

(1) The Partnership recorded $ 114.3 million of impairment expense to impair certain assets during the year ended December 31, 2020 primarily related to weakened coal markets that resulted in termination of certain coal leases and changes to lessee mine plans resulting in permanent moves off certain of our coal properties.

The Partners hip recorded $ 125.8 million of impairment expense during the year ended December 31, 2019 primarily due to deterioration in thermal coal markets, lessee capital constraints, thermal coal lease terminations, and expectations of further reductions in global and domestic thermal coal demand due to low natural gas prices and continued pressure on the electric power generation industry over emissions and climate change, resulting in reductions in expected cash flows (combination of lower expected coal sales volumes, sales prices, minimums and/or life of mine assumptions) on certain of our coal properties.

Total $ 5,102 $ 135,885 $ 125,909

(1) The Partnership recorded $ 5.0 million of impairment expense during the year ended December 31, 2021 primarily related to a lease termination.

T he Partners hip recorded $ 114.3 million of impairment expense to impair certain assets during the year ended December 31, 2020 primarily related to weakened coal markets that resulted in termination of certain coal leases and changes to lessee mine plans resulting in permanent moves off certain of our coal properties.

The partnership recorded $ 125.8 million of impairment expense during the year ended December 31, 2019 primarily due to deterioration in thermal coal markets, lessee capital constraints, thermal coal lease terminations, and expectations of further reductions in global and domestic thermal coal demand due to low natural gas prices and continued pressure on the electric power generation industry over emissions and climate change, resulting in reductions in expected cash flows (combination of lower expected coal sales volumes, sales prices, minimums and/or life of mine assumptions) on certain of our coal properties.

During the year ended December 31, 2019, the Partnership recorded $ 36.0 million to fully impair certain coal properties.

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The fair value of the impaired assets at December 31, 2019 was calculated using a discount rate of 15 %.

The Partnership recorded $ 5.3 million of coal property impairments during the year ended December 31, 2018 primarily as a result of lease terminations, of which it recorded $ 5.0 million of impairment expense to fully impair certain coal properties during the three months ended December 31, 2018.

NRP compared the net

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

book value of its coal properties to estimated undiscounted future net cash flows.

NRP compared the net book value of its coal properties to estimated undiscounted future net cash flows.

If the net book value exceeded the undiscounted future cash flows, the Partnership recorded an impairment for the excess of the net book value over fair value.

A discounted cash flow model was used to estimate fair value.

Significant inputs used to determine fair value include estimates of future cash flows from coal sales and minimum payments, discount rate and useful economic life.

Significant inputs used to determine fair value include estimates of future cash flows from

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

coal sales and minimum payments, discount rate and useful economic life.

Estimated cash flows are the product of a process that began with current realized pricing as of the measurement date and included an adjustment for risk related to the future realization of cash flows.

(2) The Partnership recorded $ 21.6 million of aggregates royalty property impairments during the year ended December 31, 2020 primarily related to decreased oil and gas drilling activity which negatively impacted the outlook for NRP's frac sand properties.

Th e Partnership recorded $ 0.1 million of aggregates royalty property impairments during the year ended December 31, 2019.

During the three months ended December 31, 2018, the Partnership recorded $ 13.0 million of impairment expense related to an aggregates property that the Partnership owns and leases to its former construction aggregates business, which mines, produces and sells the aggregates.

The fair value of the impaired asset was reduced to $ 2.3 million at December 31, 2018 using a discount rate of 11 %.

(2) The Partnership recorded $ 0.1 million of aggregates royalty property impairments during the year ended December 31, 2021.

Th e Partnership recorded $ 21.6 million of aggregates royalty property impairments during the year ended December 31, 2020 primarily related to decreased oil and gas drilling activity which negatively impacted the outlook for NRP's frac sand properties.

The Partnership recorded $ 0.1 million of aggregates royalty property impairments during the year ended December 31, 2019.

NRP compared the net book value of its aggregates and timber properties to estimated undiscounted future net cash flows.

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Total intangible assets, net $ 16,130 $ 17,459

Amortization expense included in depreciation, depletion and amortization on the Partnership's Consolidated Statements of Comprehensive Income (Loss) was $ 0.2 million, $ 2.5 million and $ 4.3 million for the years ended December 31, 2020, 2019 and 2018, respectively.

During the year ended December 31, 2019, the Partnership identified facts and circumstances that indicated that the carrying value of certain of its above-market contracts exceed future cash flows from those assets and recorded a non-cash impairment expense of $ 22.3 million to fully impair these assets.

These impairments are included in asset impairments on the Partnership's Consolidated Statements of Comprehensive Income (Loss) and resulted from deterioration in thermal coal markets, lessee capital constraints, and expectations of further reductions in global and domestic thermal coal demand due to low natural gas prices and continued pressure on the electric power generation industry over emissions and climate change, resulting in reductions in expected cash flows (combination of lower expected coal sales volumes, sales prices and/or life of mine assumptions) on certain of our intangible assets.

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Amortization expense included in depreciation, depletion and amortization on the Partnership's Consolidated Statements of Comprehensive Income (Loss) was $ 1.3 million, $ 0.2 million and $ 2.5 million for the year ended December 31, 2021, 2020 and 2019, respectively.

The estimates of amortization expense for the years ended December 31, as indicated below, are based on current mining plans and are subject to revision as those plans change in future periods.

(In thousands) Estimated Amortization Expense

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

The Partnership's debt consists of the following:

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Revolving credit facility $ — $ —

5.05 % with semi-annual interest payments in January and July, with annual principal payments in July, due July 2020

5.55 % with semi-annual interest payments in June and December, with annual principal payments in June, due June 2023

$ 4,730 $ 7,094

4.73 % with semi-annual interest payments in June and December, with annual principal payments in December, due December 2023

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Total long-term debt, net $ 394,443 $ 432,444

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

2025 Senior Notes

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NRP and NRP Finance have the option to redeem the 2025 Senior Notes, in whole or in part, at any time on or after October 30, 2021, at the redemption prices (expressed as percentages of principal amount) of 104.563 % for the 12-month period beginning October 30, 2021, 102.281 % for the 12-month period beginning October 30, 2022, and thereafter at 100.000 %, together, in each case, with any accrued and unpaid interest to the date of redemption.

Furthermore, before October 30, 2021, NRP may on any one or more occasions redeem up to 35 % of the aggregate principal amount of the 2025 Senior Notes with the net proceeds of certain public or private equity offerings at a redemption price of 109.125 % of the principal amount of 2025 Senior Notes, plus any accrued and unpaid interest, if any, to the date of redemption, if at least 65 % of the aggregate principal amount of the 2025 Senior Notes issued under the 2025 Indenture remains outstanding immediately after such redemption and the redemption occurs within 180 days of the closing date of such equity offering.

In the event of a change of control, as defined in the 2025 Indenture, the holders of the 2025 Senior Notes may require us to purchase their 2025 Senior Notes at a purchase price equal to 101 % of the principal amount of the 2025 Senior Notes, plus accrued and unpaid interest, if any.

5 unchanged sentences

As of December 31, 2021 and 2020, NRP and NRP Finance were in compliance with the terms of the Indenture relating to their 2025 Senior Notes.

NATURAL RESOURCE PARTNERS L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

2022 Senior Notes

During the second quarter of 2019, the Partnership redeemed the 2022 Senior Notes at a redemption price equal to 105.250 % of the principal amount of the 2022 Senior Notes, plus accrued and unpaid interest.

In 2019, the Partnership redeemed its 2022 Senior Notes at a redemption price equal to 105.250 % of the principal amount of the 2022 Senior Notes, plus accrued and unpaid interest.

In connection with the early redemption, the Partnership paid an $ 18.1 million call premium and also wrote off $ 10.4 million of unamortized debt issuance costs and debt discount.

These expenses are included in loss on extinguishment of debt on the Partnership's Consolidated Statements of Comprehensive Income (Loss).

All of Opco’s debt is guaranteed by its wholly owned subsidiaries and is secured by certain of the assets of Opco and its wholly owned subsidiaries other than NRP Trona LLC.

All of Opco’s debt is guaranteed by its wholly owned subsidiaries and is secured by certain of the assets of Opco and its wholly owned subsidiaries, other than BRP LLC and NRP Trona LLC.

As of December 31, 2021 and 2020, Opco was in compliance with the terms of the financial covenants contained in its debt agreements.

Opco Credit Facility

In April 2019, the Partnership entered into the Fourth Amendment (the “Fourth Amendment”) to the Opco Credit Facility (the "Opco Credit Facility").

In 2019, the Partnership entered into the Fourth Amendment (the “Fourth Amendment”) to the Opco Credit Facility (the "Opco Credit Facility").

The Fourth Amendment extends the term of the Opco Credit Facility until April 2023.

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• a rate equal to LIBOR plus an applicable margin ranging from 3.50 % to 4.50 %.

NATURAL RESOURCE PARTNERS L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

During the years ended December 31, 2021 and 2020, the Partnership did not have any borrowings outstanding under the Opco Credit Facility and had $ 100.0 million in available borrowing capacity at both December 31, 2021 and 2020.

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The Opco Credit Facility is collateralized and secured by liens on certain of Opco’s assets with carrying values o f $ 345.0 million and $ 364.5 million classified as mineral rights, net and other long-term assets, net on the Partnership’s Consolidated Balance Sheets as of December 31, 2021 and 2020, respectively.

The collateral includes (1) the equity interests in all of Opco’s wholly owned subsidiaries, other than BRP LLC and NRP Trona LLC (which owns a 49 % non-controlling equity interest in Ciner Wyoming), (2) the personal property and fixtures owned by Opco’s wholly owned subsidiaries, other than NRP Trona LLC, (3) Opco’s material coal royalty revenue producing properties, and (4) certain of Opco’s coal-related infrastructure assets.

The collateral includes (1) the equity interests in all of Opco’s wholly owned subsidiaries, other than BRP LLC and NRP Trona LLC (which owns a 49 % non-controlling equity interest in Sisecam Wyoming), (2) the personal property and fixtures owned by Opco’s wholly owned subsidiaries, other than BRP LLC and NRP Trona LLC, (3) Opco’s material coal royalty revenue producing properties, and (4) certain of Opco’s coal-related infrastructure assets.

NATURAL RESOURCE PARTNERS L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

Opco Senior Notes

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As of December 31, 2021 and 2020, the Opco Senior Notes had cumulative principal balances of $ 138.5 million and $ 177.9 million, respectively.

Opco made mandatory principal payments on the Opco Senior Notes of $ 46.2 million, $ 117.4 million and $ 80.7 million during the years ended December 31, 2020, 2019 and 2018, respectively.

Opco made mandatory principal payments on the Opco Senior Notes of $ 39.4 million, $ 46.2 million and $ 117.4 million during the year ended December 31, 2021, 2020 and 2019, respectively.

The payments made during the year ended December 31, 2019 included a $ 49.3 million pre-payment as a result of the sale of the Partnership's construction aggregates business.

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In addition, the Note Purchase Agreements include a covenant that provides that, in the event NRP Operating or any of its subsidiaries is subject to any additional or more restrictive covenants under the agreements governing its material indebtedness (including the Opco Credit Facility and all renewals, amendments or restatements thereof), such covenants shall be deemed to be incorporated by reference in the Note Purchase Agreements and the holders of the Notes shall receive the benefit of such additional or more restrictive covenants to the same extent as the lenders under such material indebtedness agreement.

NATURAL RESOURCE PARTNERS L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

The 8.92 % Opco Senior Notes also provides that in the event that Opco’s leverage ratio of consolidated indebtedness to consolidated EBITDDA (as defined in the Note Purchase Agreements) exceeds 3.75 to 1.00 at the end of any fiscal quarter, then in addition to all other interest accruing on these notes, additional interest in the amount of 2.00 % per annum shall accrue on the notes for the two succeeding quarters and for as long thereafter as the leverage ratio remains above 3.75 to 1.00.

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3 $ 33,612 $ 26,010 $ 35,313 $ 27,025

(1) The fair value of the Opco Senior Notes are estimated by management using quotations obtained for the NRP 2025 Senior Notes on the closing trading prices near period end, which were at 92 % of par value at December 31, 2020.

(2) The fair value of the Partnership's contract receivable is determined based on the present value of future cash flow projections related to the underlying asset at a discount rate of 15 % at December 31, 2020.

NRP has embedded derivatives in the preferred units related to certain conversion options, redemption features and the change of control provision that are accounted for separately from the preferred units as assets and liabilities at fair value on the Partnership's Consolidated Balance Sheets.

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Fair Value of Non-Financial Assets

The Partnership discloses or recognizes its non-financial assets, such as impairments of coal and aggregates properties and other assets, at fair value on a nonrecurring basis.

The Partnership discloses or recognizes its non-financial assets, such as impairments of coal and aggregates properties at fair value on a nonrecurring basis.

Refer to Note 9.

Mineral Rights, Net and Note 10.

Intangible Assets, Net for additional disclosures related to the fair value associated with the impaired assets.

Mineral Rights, Net for additional disclosures related to the fair value associated with the impaired assets.

NATURAL RESOURCE PARTNERS L.P.

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These QMC and WPPLP employee management service costs are presented as operating and maintenance expenses and general and administrative expenses on the Partnership's Consolidated Statements of Comprehensive Income (Loss).

NRP also reimburses overhead costs incurred by its affiliates to manage the Partnership's business.

NRP also reimburses overhead costs incurred by its affiliates, including Quintana Infrastructure Development ("QID"), to manage the Partnership's business.

These overhead costs include certain rent, information technology, administration of employee benefits and other corporate services incurred by or on behalf of the Partnership’s general partner and its affiliates and are presented as operating and maintenance expenses and general and administrative expenses on the Partnership's Consolidated Statements of Comprehensive Income (Loss).

Direct general and administrative expenses charged to the Partnership by QMC and WPPLP are included on the Partnership's Consolidated Statement of Comprehensive Income (Loss) as follows:

Direct general and administrative expenses charged to the Partnership by QMC, WPPLP and QID are included on the Partnership's Consolidated Statement of Comprehensive Income (Loss) as follows:

For the Year Ended December 31,

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During the years ended December 31, 2021, 2020 and 2019, the Partnership recognized $ 3.3 million, $ 0.4 million and $ 4.0 million in operating and maintenance expenses, respectively, on its Consolidated Statements of Comprehensive Income (Loss) related to an overriding royalty agreement with WPPLP.

At December 31, 2020, the Partnership had $ 0.3 million of other long-term assets, net on its Consolidated Balance Sheets related to a prepaid royalty for this agreement.

At December 31, 2019, the Partnership had $ 0.1 million of accounts payable to WPPLP on its Consolidated Balance Sheets related to this agreement.

At December 31, 2021 and 2020, the Partnership ha d $ 0.0 million and $ 0.3 million, respectively, of other long-term assets, net on its Consolidated Balance Sheets related to a p repaid royalty for this agreement.

Robertson, Jr.

owns 85 % of the general partner of Great Northern Properties Limited Partnership ("GNP"), a privately held company primarily engaged in owning and managing mineral properties and surface leases.

As of December 31, 2021 the Partnership had $ 0.1 million of accounts receivable from GNP included in accounts receivable, net on its Consolidated Balance Sheets related to amounts collected for surface leases that belong to NRP.

Industrial Minerals Group LLC

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Robertson, III, a Director of GP Natural Resource Partners LLC, held a minority ownership interest in Industrial Minerals Group LLC (“Industrial Minerals”), which, through its subsidiaries, leases one of NRP’s coal royalty properties in Central Appalachia.

Coal royalty related revenues from Industrial Minerals totaled $ 1.7 million and $ 0.8 million for the years ended December 31, 2019 and 2018, respectively.

The Partnership had accounts receivable from Industrial Minerals of $ 0.7 million on its Consolidated Balance Sheets as of December 31, 2019.

Coal royalty related revenues from Industrial Minerals totaled $ 1.7 million for the year ended December 31, 2019.

Quinwood Coal Company Royalty

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Robertson, III, leases two coal properties from NRP in Central Appalachia.

Coal related revenues from Quinwood totaled $ 0.0 million, $ 0.2 million and $ 0.0 million for the years ended December 31, 2020, 2019 and 2018, respectively.

Coal related revenues from Quinwood totaled $ 0.0 million , $ 0.0 million and $ 0.2 million for the year ended December 31, 2021, 2020 and 2019, respectively.

NATURAL RESOURCE PARTNERS L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

Quintana Capital Group GP, Ltd.

Robertson, Jr.

is a principal in Quintana Capital Group GP, Ltd.

("Quintana Capital"), which controls several private equity funds focused on investments in the energy business.

In connection with the formation of Quintana Capital, the Partnership adopted a formal conflicts policy that establishes the opportunities that will be pursued by the Partnership and those that will be pursued by Quintana Capital.

The governance documents of Quintana Capital’s affiliated investment funds reflect the guidelines set forth in the Partnership's conflicts policy.

At December 31, 2020, a fund controlled by Quintana Capital owned a substantial interest in Corsa Coal Corp.

("Corsa"), a coal mining company traded on the TSX Venture Exchange that was one of the Partnership’s lessees in Tennessee.

During the second quarter of 2018, Corsa assigned its lease with NRP to a third party and is no longer deemed a related party as of such date.

Coal related revenues from Corsa totaled $ 0.5 million for the year ended December 31, 2018.

Major Customers

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Alpha Metallurgical Resources, Inc.

(formerly Contura Energy Inc.) (1) (3)

49,440 23 % 33,227 24 % 40,743 16 %

(1) Revenues from Foresight and Alpha Metallurgical Resources, Inc.

(formerly Contura Energy Inc.) are included within the Partnership's Coal Royalty and Other segment.

are included within the Partnership's Mineral Rights segment.

(2) In June 2020, the Partnership entered into lease amendments with Foresight pursuant to which Foresight agreed to pay NRP fixed cash payments to satisfy all obligations arising out of the existing various coal mining leases and transportation infrastructure fee agreements between the Partnership and Foresight for calendar years 2020 and 2021.

(3) In the fourth quarter of 2018, Contura Energy and Alpha Natural Resources merged.

Revenues during the year ended December 31, 2020 and 2019 relate to the combined company, while revenues during the year ended December 31, 2018 do not include revenues from Alpha Natural Resources until the date of the merger.

In February 2021, Contura Energy changed its name to Alpha Metallurgical Resources, Inc.

Commitments and Contingencies

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While the ultimate results of these proceedings cannot be predicted with certainty, Partnership management believes these ordinary course matters will not have a material effect on the Partnership’s financial position, liquidity or operations.

In November 2019, the District Court of Harris County, Texas, 157th Judicial District, issued a ruling in the contingent consideration payment dispute that Anadarko Holding Company and its subsidiary, Big Island Trona Company (together, "Anadarko") brought against NRP in July 2017.

The Trial Court ruled in NRP's favor in all respects and ordered that Anadarko take nothing.

Anadarko did not appeal the trial court ruling, and accordingly this lawsuit was concluded in the first quarter of 2020 with no liability to the Partnership.

Environmental Compliance

2 unchanged sentences

Business and Properties—Regulation and Environmental Matters ." As an owner of surface interests in some properties, the Partnership may be liable for certain environmental conditions occurring on the surface properties.

NATURAL RESOURCE PARTNERS L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

terms of substantially all of the Partnership’s coal leases require the lessee to comply with all applicable laws and regulations, including environmental laws and regulations.

The terms of substantially all of the Partnership’s coal leases require the lessee to comply with all applicable laws and regulations, including environmental laws and regulations.

Lessees post reclamation bonds assuring that reclamation will be completed as required by the relevant permit, and substantially all of the leases require the lessee to indemnify the Partnership against, among other things, environmental liabilities.

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As a former owner of the working interests in oil and natural gas operations, the Partnership is responsible for its proportionate share of any losses and liabilities, including environmental liabilities, arising from uninsured and underinsured events during the period it was an owner.

NATURAL RESOURCE PARTNERS L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

Unit-Based Compensation

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The awards granted in 2021, 2020 and 2019 were valued using the closing price of NRP's units as of the grant date.

The grant date fair value of these awards granted during the years ended December 31, 2020, 2019 and 2018 were $ 3.5 million, $ 5.4 million and $ 2.2 million, respectively.

Total unit-based compensation expense associated with these awards was $ 3.6 million,$ 2.4 million and $ 1.1 million for the years ended December 31, 2020, 2019 and 2018, respectively, and is included in general and administrative expenses and operating and maintenance expenses on the Partnership's Consolidated Statements of

NATURAL RESOURCE PARTNERS L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

Comprehensive Income (Loss).

The grant date fair value of these awards granted during the year ended December 31, 2021, 2020 and 2019 were $ 3.8 million, $ 3.5 million and $ 5.4 million, respectively.

Total unit-based compensation expense associated with these awards was $ 4.0 million,$ 3.6 million and $ 2.4 million for the year ended December 31, 2021, 2020 and 2019, respectively, and is included in general and administrative expenses and operating and maintenance expenses on the Partnership's Consolidated Statements of Comprehensive Income (Loss).

The unamortized cost associated with unvested outstanding awards as of December 31, 2021 is $ 3.3 million, which is to be recognized over a weighted average period of 1.7 years.

1 unchanged sentence

A summary of the unit activity in the outstanding grants during 2021 is as follows:

(In thousands) Common Units Weighted Average Exercise Price

(In thousands) Common Units Weighted Average Grant Date Fair value per Common Unit

Outstanding grants at January 1, 2021 355 $ 26.20

3 unchanged sentences

Outstanding at December 31, 2021 411 $ 23.00

NATURAL RESOURCE PARTNERS L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

Financing Transaction

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For its long-term contract receivable, management reverts to the historical loss experience immediately after the reasonable and supportable forecast period ends.

As of December 31, 2020, NRP recorded the following current expected credit loss (“CECL”) related to its receivables and long-term contract receivable:

(In thousands) Gross CECL Allowance Net

As of December 31, 2021 and 2020, NRP recorded the following current expected credit loss (“CECL”) related to its receivables and long-term contract receivable:

(In thousands) Gross CECL Allowance Net Gross CECL Allowance Net

Receivables $ 28,869 $ ( 3,312 ) $ 25,557 $ 18,512 $ ( 2,358 ) $ 16,154

1 unchanged sentence

Total $ 61,366 $ ( 4,438 ) $ 56,928 $ 53,330 $ ( 3,912 ) $ 49,418

NRP recorded $ 0.0 million in operating and maintenance expenses on its Consolidated Statement of Comprehensive Income (Loss) related to the change in CECL allowance during the year ended December 31, 2020.

NRP recorded $ 0.5 million and $ 0.0 million in operating and maintenance expenses on its Consolidated Statements of Comprehensive Income (Loss) related to the change in the CECL allowance during the year ended December 31, 2021 and 2020, respectively.

NRP has procedures in place to monitor its ongoing credit exposure through timely review of counterparty balances against contract terms and due dates, account and financing receivable reconciliations, bankruptcy monitoring, lessee audits and dispute resolution.

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As the Partnership's lease does not provide an implicit rate, the Partnership estimated the incremental borrowing rate at the time the lease was entered into by utilizing the rate of the Partnership's secured debt and adjusting it for factors that reflect the profile of borrowing over the 30 -year expected lease term.

Discontinued Operations

In December 2018, the Partnership sold VantaCore Partners LLC, its construction aggregates materials business for $ 205 million, before customary purchase price adjustments and transaction expenses, and recorded a gain of $ 13.1 million, and in July 2016, the Partnership sold its non-operated oil and gas working interest assets.

The Partnership's exit from both its construction aggregates business and non-operated oil and gas working interest business represented strategic shifts to reduce debt and focus on its Coal Royalty and Other and Soda Ash business segments.

As a result, the Partnership classified the assets and liabilities, operating results and cash flows of these businesses as discontinued operations on its Consolidated Balance Sheets, Consolidated Statements of Comprehensive Income (Loss) and Consolidated Statements of Cash Flows for all periods presented.

NATURAL RESOURCE PARTNERS L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

The following table presents the carrying amounts of the Partnership's assets and liabilities of discontinued operations on the Consolidated Balance Sheet at December 31, 2019:

(In thousands) Construction Aggregates NRP

Oil and Gas Total

Current assets

Accounts receivable, net $ — $ 1,706 $ 1,706

Total assets of discontinued operations $ — $ 1,706 $ 1,706

Current liabilities

Accounts payable $ 42 $ — $ 42

Accrued liabilities 23 — 23

Total liabilities of discontinued operations $ 65 $ — $ 65

The following tables present summarized financial results of the Partnership's discontinued operations on the Consolidated Statements of Comprehensive Income (Loss):

For the Year Ended December 31, 2019

(In thousands) Construction Aggregates NRP

Oil and Gas Total

Revenues and other income

Oil and gas $ — $ 2 $ 2

Gain on asset sales and disposals 280 — 280

Total revenues and other income $ 280 $ 2 $ 282

Operating expenses

Operating and maintenance expenses $ 27 $ 16 $ 43

Total operating expenses $ 27 $ 16 $ 43

Other income $ — $ 717 $ 717

Income from discontinued operations $ 253 $ 703 $ 956

NATURAL RESOURCE PARTNERS L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

For the Year Ended December 31, 2018

(In thousands) Construction Aggregates NRP

Oil and Gas Total

Revenues and other income

Construction aggregates $ 116,066 $ — $ 116,066

Road construction and asphalt paving services 18,400 — 18,400

Oil and gas — ( 3 ) ( 3 )

Gain on asset sales and disposals 13,414 — 13,414

Total revenues and other income $ 147,880 $ ( 3 ) $ 147,877

Operating expenses

Operating and maintenance expenses $ 117,568 $ 134 $ 117,702

Depreciation, depletion and amortization 12,218 — 12,218

Asset impairments 232 — 232

Total operating expenses $ 130,018 $ 134 $ 130,152

Interest expense $ ( 38 ) $ — $ ( 38 )

Income (loss) from discontinued operations $ 17,824 $ ( 137 ) $ 17,687

Capital expenditures related to the Partnership's discontinued operations were $ 10.9 million during the year ended December 31, 2018, of which $ 0.9 million were funded with accounts payable or accrued liabilities.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

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 8. Financial Statements and Supplementary Data