The following review of operations for the three and six month periods
ended June 30, 2020 and 2019 should be read in conjunction with our consolidated
financial statements and the notes to consolidated financial statements included
in this Form 10-Q and with the consolidated financial statements, notes to
consolidated financial statements and management's discussion and analysis
included in the Natural Resource Partners L.P. Annual Report on Form 10-K for
the year ended December 31, 2019.
As used herein, unless the context otherwise requires: "we," "our," "us" and the
"Partnership" refer to Natural Resource Partners L.P. and, where the context
requires, our subsidiaries. References to "NRP" and "Natural Resource Partners"
refer to Natural Resource Partners L.P. only, and not to NRP (Operating) LLC or
any of Natural Resource Partners L.P.'s subsidiaries. References to "Opco" refer
to NRP (Operating) LLC, a wholly owned subsidiary of NRP, and its subsidiaries.
NRP Finance Corporation ("NRP Finance") is a wholly owned subsidiary of NRP and
a co-issuer with NRP on the 9.125% senior notes due 2025 (the "2025 Senior
Notes").
INFORMATION REGARDING FORWARD-LOOKING STATEMENTS
Statements included in this 10-Q may constitute forward-looking statements. In
addition, we and our representatives may from time to time make other oral or
written statements which are also forward-looking statements. Such
forward-looking statements include, among other things, statements regarding:
the effects of the global COVID-19 pandemic; our business strategy; our
liquidity and access to capital and financing sources; our financial strategy;
prices of and demand for coal, trona and soda ash, and other natural resources;
estimated revenues, expenses and results of operations; projected production
levels by our lessees; Ciner Wyoming LLC's ("Ciner Wyoming's") trona mining and
soda ash refinery operations; distributions from our soda ash joint venture; the
impact of governmental policies, laws and regulations, as well as regulatory and
legal proceedings involving us, and of scheduled or potential regulatory or
legal changes; and global and U.S. economic conditions.
These forward-looking statements speak only as of the date hereof and are made
based upon our current plans, expectations, estimates, assumptions and beliefs
concerning future events impacting us and involve a number of risks and
uncertainties. We caution that forward-looking statements are not guarantees and
that actual results could differ materially from those expressed or implied in
the forward-looking statements. You should not put undue reliance on any
forward-looking statements. See "Item 1A. Risk Factors" included in this Form
10-Q and in our Annual Report on Form 10-K for the year ended December 31, 2019
for important factors that could cause our actual results of operations or our
actual financial condition to differ.
NON-GAAP FINANCIAL MEASURES
Adjusted EBITDA
Adjusted EBITDA is a non-GAAP financial measure that we define as net income
(loss) from continuing operations less equity earnings (loss) from
unconsolidated investment, net income attributable to non-controlling interest
and gain on reserve swap; plus total distributions from unconsolidated
investment, interest expense, net, debt modification expense, loss on
extinguishment of debt, depreciation, depletion and amortization and asset
impairments. Adjusted EBITDA should not be considered an alternative to, or more
meaningful than, net income or loss, net income or loss attributable to
partners, operating income, cash flows from operating activities or any other
measure of financial performance presented in accordance with GAAP as measures
of operating performance, liquidity or ability to service debt obligations.
There are significant limitations to using Adjusted EBITDA as a measure of
performance, including the inability to analyze the effect of certain recurring
items that materially affect our net income (loss), the lack of comparability of
results of operations of different companies and the different methods of
calculating Adjusted EBITDA reported by different companies. In addition,
Adjusted EBITDA presented below is not calculated or presented on the same basis
as Consolidated EBITDA as defined in our partnership agreement or Consolidated
EBITDDA as defined in Opco's debt agreements. For a description of Opco's debt
agreements, see   Note 8. Debt, Net   in the Notes to Consolidated Financial
Statements included herein as well as in "Item 8. Financial Statements and
Supplementary Data-Note 12. Debt, Net" in our Annual Report on Form 10-K for the
year ended December 31, 2019. Adjusted EBITDA is a supplemental performance
measure used by our management and by external users of our financial
statements, such as investors, commercial banks, research analysts and others to
assess the financial performance of our assets without regard to financing
methods, capital structure or historical cost basis.

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Distributable Cash Flow
Distributable cash flow ("DCF") represents net cash provided by (used in)
operating activities of continuing operations plus distributions from
unconsolidated investment in excess of cumulative earnings, proceeds from asset
sales and disposals, including sales of discontinued operations, and return of
long-term contract receivables; less maintenance capital expenditures and
distributions to non-controlling interest. DCF is not a measure of financial
performance under GAAP and should not be considered as an alternative to cash
flows from operating, investing or financing activities. DCF may not be
calculated the same for us as for other companies. In addition, DCF presented
below is not calculated or presented on the same basis as distributable cash
flow as defined in our partnership agreement, which is used as a metric to
determine whether we are able to increase quarterly distributions to our common
unitholders. DCF is a supplemental liquidity measure used by our management and
by external users of our financial statements, such as investors, commercial
banks, research analysts and others to asses our ability to make cash
distributions and repay debt.
Free Cash Flow
Free cash flow ("FCF") represents net cash provided by (used in) operating
activities of continuing operations plus distributions from unconsolidated
investment in excess of cumulative earnings and return of long-term contract
receivables; less maintenance and expansion capital expenditures, cash flow used
in acquisition costs classified as investing or financing activities and
distributions to non-controlling interest. FCF is calculated before mandatory
debt repayments. FCF is not a measure of financial performance under GAAP and
should not be considered as an alternative to cash flows from operating,
investing or financing activities. FCF may not be calculated the same for us as
for other companies. FCF is a supplemental liquidity measure used by our
management and by external users of our financial statements, such as investors,
commercial banks, research analysts and others to assess our ability to make
cash distributions and repay debt.
Introduction
The following discussion and analysis presents management's view of our
business, financial condition and overall performance. Our discussion and
analysis consists of the following subjects:
•Executive Overview
•Results of Operations
•Liquidity and Capital Resources
•Off-Balance Sheet Transactions
•Related Party Transactions
•Summary of Critical Accounting Estimates
•Recent Accounting Standards
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Executive Overview
We are a diversified natural resource company engaged 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 own a non-controlling 49% interest in Ciner Wyoming LLC ("Ciner
Wyoming"), a trona ore mining and soda ash production business. Our common units
trade on the New York Stock Exchange under the symbol "NRP." Our business is
organized into 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. Our coal reserves are primarily located in
Appalachia, the Illinois Basin and the Northern Powder River Basin in the United
States. Our industrial minerals and aggregates properties are located in various
states across the United States, our oil and gas royalty assets are primarily
located in Louisiana and our timber assets are primarily located in West
Virginia.
Soda Ash-consists of our 49% non-controlling equity interest in Ciner Wyoming, a
trona ore mining and soda ash production business located in the Green River
Basin of Wyoming. Ciner Resources LP, our operating partner, mines the trona,
processes it into soda ash, and distributes the soda ash both domestically and
internationally into the glass and chemicals industries.
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.
The global COVID-19 pandemic has had a significant negative impact on demand for
steel, electricity and glass, which translates to lower demand for the coal and
soda ash we produce. We continue to employ remote work protocols and are
conducting business as usual despite the pandemic. Although we are unable to
predict the severity or duration of the impact on our business, we currently
have approximately $210 million of liquidity. In addition, our $300 million of
parent company notes does not mature until 2025. Accordingly, we believe we are
well-positioned to manage through the downturn.
Our financial results by segment for the six months ended June 30, 2020 are as
follows:
                                                               Operating Segments
                                                      Coal Royalty                          Corporate and
(In thousands)                                         and Other           Soda Ash           Financing              Total
Revenues and other income                            $    68,011          $  3,214          $         -          $   71,225
Net income (loss) from continuing operations         $   (81,735)         $  3,169          $   (28,156)         $ (106,722)
Adjusted EBITDA (1)                                  $    54,637          $ 

14,165 $ (7,534) $ 61,268



Cash flow provided by (used in) continuing
operations
Operating activities                                 $    62,509          $ 14,166          $   (26,585)         $   50,090
Investing activities                                 $       637          $      -          $         -          $      637
Financing activities                                 $         -          $      -          $   (38,164)         $  (38,164)
Distributable cash flow (1)                          $    64,146          $ 14,166          $   (26,585)         $   51,661
Free cash flow (1)                                   $    62,639          $ 14,166          $   (26,585)         $   50,220

(1)See "-Results of Operations" below for reconciliations to the most comparable GAAP financial measures.


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Current Results/Market Commentary
Coal Royalty and Other Business Segment

Our lessees sold 8.4 million tons of coal from our properties in the first six
months of 2020 and we derived approximately 70% of our coal royalty revenues and
approximately 65% of our coal royalty sales volumes from metallurgical coal
during the same period. Revenues and other income in the first six months of
2020 were lower by $57.5 million, as compared to the prior year period. This
decrease is primarily a result of a weakened market for metallurgical coal as
compared to the prior year period due to a decline in global steel demand. As a
result, both sales volumes and prices for metallurgical coal sold were lower in
the first six months of 2020 compared to the prior year period. In addition,
weaker domestic and export thermal coal markets compared to the prior year
period resulted in lower revenue from our thermal coal properties. Domestic and
export thermal coal markets remained challenged by lower utility demand,
continued low natural gas prices and the secular shift to renewable energy. The
COVID-19 pandemic has compounded already weak coal pricing and demand, and our
coal lessees are seeing significant negative impacts on their businesses.

During the second quarter of 2020, our largest lessee, Foresight Energy, emerged
from bankruptcy. We entered into lease amendments pursuant to which Foresight
agreed to pay us fixed cash payments of $48.75 million in 2020 and $42.0 million
in 2021 to satisfy all obligations arising out of the existing various coal
mining leases and transportation infrastructure fee agreements between us and
Foresight Energy for calendar years 2020 and 2021. Through the first six months
of 2020, we received $21.2 million of the $48.75 million due to us in 2020.
Beginning in January 2022, Foresight payment obligations will be calculated in
accordance with the provisions of the original lease agreements, except with
respect to the Macoupin mine. While the Macoupin mine is idled, Foresight will
pay an annual fee of $2.0 million to us each year through 2023 to continue to
lease our coal reserves at Macoupin.

We recorded $132.3 million in non-cash asset impairment expense in the second
quarter of 2020, primarily related to weakened coal markets that resulted in
termination of certain coal leases, changes to lessee mine plans resulting in
permanent moves off certain of our coal properties and decreased oil and gas
drilling activity which negatively impacted the outlook for our frac sand
properties.
Soda Ash Business Segment
Ciner Wyoming was negatively impacted by the COVID-19 pandemic as lower activity
in the global auto, container and construction industries reduced demand for
glass and soda ash. Revenues and other income in the second quarter of 2020 were
lower by $14.4 million compared to the prior year quarter primarily due to a
combination of lower pricing and volumes sold. Distributions received from Ciner
Wyoming were $7.1 million in the second quarter of 2020 as compared to $9.3
million in the second quarter of 2019.
Global soda ash prices are down roughly 25% from a year ago, to levels that we
believe are below the cost of production of the world's synthetic soda ash
producers and some of the natural soda ash producers. We expect the soda ash
industry to face significant headwinds until the global economy gets back on
track. While we believe our facility is competitively positioned as one of the
lowest cost producers of soda ash in the world, we expect soda ash markets to
continue to be challenged over the next several quarters.
Ciner Wyoming continues to develop plans for a significant capacity expansion
capital project. However, they have delayed the timing of significant costs
related to this project until they have more clarity and visibility into the
impact of the COVID-19 pandemic on its business. In addition, in order to
achieve greater financial flexibility during the COVID-19 pandemic, Ciner
Wyoming suspended its quarterly distribution for the second quarter which would
have been paid to us in August 2020. Ciner Wyoming will continue to evaluate, on
a quarterly basis whether to reinstate the distribution, which will be dependent
in part on its cash reserves, liquidity, total debt levels and anticipated
capital expenditures.
Business Outlook

The global COVID-19 pandemic continues to affect businesses across the world.
Although we are unable to predict the severity or duration of the COVID-19
pandemic's impact on our business, we continue to maintain strong cash balances
and liquidity, and efforts to de-lever and de-risk the Partnership over the past
five years have prepared NRP to operate through this downturn.

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Results of Operations
Second Quarter of 2020 and 2019 Compared
Revenues and Other Income
The following table includes our revenues and other income by operating segment:
                                               For the Three Months Ended June
                                                             30,                                                              Percentage
Operating Segment (In thousands)                   2020               2019                                  Decrease            Change
Coal Royalty and Other                         $  34,069           $ 70,136          $ (36,067)                   (51) %
Soda Ash                                          (3,058)            11,333            (14,391)                  (127) %
Total                                          $  31,011           $ 81,469          $ (50,458)                   (62) %


The changes in revenues and other income is discussed for each of the operating segments below:


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Coal Royalty and Other
The following table presents coal sales volumes, coal royalty revenue per ton
and coal royalty revenues by major coal producing region, the significant
categories of other revenues and other income:
                                                  For the Three Months 

Ended June


                                                                30,                                             Increase           Percentage
(In thousands, except per ton data)                   2020               2019                                  (Decrease)            Change
Coal sales volumes (tons)
Appalachia
Northern                                                 87              1,625             (1,538)                     (95) %
Central                                               2,463              3,825             (1,362)                     (36) %
Southern                                                426                386                 40                       10  %
Total Appalachia                                      2,976              5,836             (2,860)                     (49) %
Illinois Basin                                          578                535                 43                        8  %
Northern Powder River Basin                             340                591               (251)                     (42) %

Total coal sales volumes                              3,894              6,962             (3,068)                     (44) %

Coal royalty revenue per ton
Appalachia
Northern                                          $    2.74           $   0.86          $    1.88                      218  %
Central                                                4.04               6.03              (1.99)                     (33) %
Southern                                               4.96               6.69              (1.73)                     (26) %

Illinois Basin                                         1.97               4.51              (2.54)                     (56) %
Northern Powder River Basin                            3.15               2.75               0.40                       15  %

Combined average coal royalty revenue per ton          3.73               4.46              (0.73)                     (16) %

Coal royalty revenues
Appalachia
Northern                                          $     238           $  1,393          $  (1,155)                     (83) %
Central                                               9,951             23,055            (13,104)                     (57) %
Southern                                              2,111              2,581               (470)                     (18) %
Total Appalachia                                     12,300             27,029            (14,729)                     (54) %
Illinois Basin                                        1,137              2,411             (1,274)                     (53) %
Northern Powder River Basin                           1,071              1,624               (553)                     (34) %
Unadjusted coal royalty revenues                     14,508             31,064            (16,556)                     (53) %
Coal royalty adjustment for minimum leases (1)       (3,661)              (361)            (3,300)                    (914) %
Total coal royalty revenues                       $  10,847           $ 30,703          $ (19,856)                     (65) %

Other revenues
Production lease minimum revenues (1)             $   8,485           $ 15,879          $  (7,394)                     (47) %
Minimum lease straight-line revenues (1)              4,987              3,854              1,133                       29  %
Property tax revenues                                   761              1,377               (616)                     (45) %
Wheelage revenues                                     1,584              1,945               (361)                     (19) %
Coal overriding royalty revenues                        683              3,999             (3,316)                     (83) %
Lease amendment revenues                                890              4,414             (3,524)                     (80) %

Aggregates royalty revenues                             271              1,237               (966)                     (78) %
Oil and gas royalty revenues                          2,742                482              2,260                      469  %
Other revenues                                          416                726               (310)                     (43) %
Total other revenues                              $  20,819           $ 33,913          $ (13,094)                     (39) %
Coal royalty and other                            $  31,666           $ 64,616          $ (32,950)                     (51) %
Transportation and processing services revenues       1,938              5,274             (3,336)                     (63) %
Gain on asset sales and disposals                       465                246                219                       89  %
Total Coal Royalty and Other segment revenues and                                                                      (51) %
other income                                      $  34,069           $ 70,136          $ (36,067)

(1)Beginning April 1, 2020 and effective January 1, 2020, certain revenues previously classified as coal royalty revenues are classified as production lease minimum revenues or minimum lease straight-line revenues due to contract modifications that fixed consideration paid to us over a two-year period.


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Coal Royalty Revenues
Approximately 80% of coal royalty revenues and approximately 70% of coal royalty
sales volumes were derived from metallurgical coal during the three months ended
June 30, 2020. Coal royalty revenues decreased $19.9 million period-over-period
primarily driven by the weakened coal markets that resulted in lower coal sales
volumes and prices. The discussion of these decreases by region is as follows:
•Appalachia: Sales volumes decreased 49% and coal royalty revenues decreased
$14.7 million primarily due to weakened coal demand compounded by the COVID-19
pandemic.
•Illinois Basin: Sales volumes increased 8% and coal royalty revenues decreased
$1.3 million primarily due to weakened coal pricing compounded by the COVID-19
pandemic.
•Northern Powder River Basin: Sales volumes decreased 42% and coal royalty
revenues decreased $0.6 million primarily due to our lessee mining off of our
property in accordance with its mine plan in 2020, partially offset by
a 15% increase in sales prices as compared to the prior year quarter.
Other Revenues
Other revenues decreased $13.1 million primarily due to the following:
•A $7.4 million decrease in production lease minimum revenues primarily as a
result of Macoupin lease amendment and lessee forfeitures of recoupable balances
in the second quarter of 2019 from minimums paid in prior periods;
•A $3.3 million decrease in coal overriding royalty revenues primarily driven by
lower activity at our Williamson property in the Illinois Basin.
•A $3.5 million decrease in lease amendment revenues year-over-year.
Transportation and Processing Services Revenues
Transportation and processing services revenues decreased $3.3 million primarily
due to idling of the Macoupin mine where we own loadout and other transportation
assets.
Soda Ash
Revenues and other income related to our Soda Ash segment decreased $14.4
million primarily due to a combination of lower pricing and volumes sold. Ciner
Wyoming was negatively impacted by the COVID-19 pandemic as lower activity in
the global auto, container and construction industries reduced demand for glass
and soda ash.
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Operating and Other Expenses
The following table presents the significant categories of our consolidated
operating and other expenses:
                                                 For the Three Months Ended June
                                                               30,                                              Increase           Percentage
(In thousands)                                        2020               2019                                  (Decrease)            Change
Operating expenses
Operating and maintenance expenses               $    8,217           $ 12,459          $  (4,242)                     (34) %
Depreciation, depletion and amortization              2,062              3,970             (1,908)                     (48) %
General and administrative expenses                   3,621              4,196               (575)                     (14) %
Asset impairments                                   132,283                  -            132,283                      100  %
Total operating expenses                         $  146,183           $ 20,625          $ 125,558                      609  %

Other expenses, net
Interest expense, net                            $   10,329           $ 12,456          $  (2,127)                     (17) %

Loss on extinguishment of debt                            -             29,282            (29,282)                    (100) %
Total other expenses, net                        $   10,329           $ 41,738          $ (31,409)                     (75) %



Total operating expenses increased $125.6 million primarily due to the
following:
•Asset impairments increased $132.3 million due to weakened coal markets that
resulted in termination of certain coal leases, changes to lessee mine plans
resulting in permanent moves off certain of our coal properties and decreased
oil and gas drilling activity which negatively impacted the outlook for NRP's
frac sand properties.
•Operating and maintenance expenses include costs to manage the Coal Royalty and
Other and Soda Ash segments and primarily consist of royalty, tax,
employee-related and legal costs and bad debt expense. These costs decreased
$4.2 million compared to the prior year quarter primarily due to decreased bad
debt expense period-over-period.
•Depreciation, depletion and amortization expense decreased $1.9 million due to
lower coal sales volumes at certain properties.
Total other expenses, net decreased $31.4 million primarily due to the
following:
•Loss on extinguishment of debt of $29.3 million in 2019 related to the 105.25%
premium paid to redeem the 2022 Senior Notes in the second quarter of 2019 as
well as the write-off of unamortized debt issuance costs and debt discount
related to the 2022 Senior Notes.
•Interest expense, net decreased $2.1 million primarily due to lower debt
balances during the second quarter of 2020 as a result of debt repayments made
over the past twelve months.
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Adjusted EBITDA (Non-GAAP Financial Measure)
The following table reconciles net income (loss) from continuing operations (the
most comparable GAAP financial measure) to Adjusted EBITDA by business segment:
                                                               Operating Segments
                                                      Coal Royalty                           Corporate and
For the Three Months Ended (In thousands)               and Other           Soda Ash           Financing              Total
June 30, 2020
Net loss from continuing operations                  $  (108,479)

$ (3,087) $ (13,935) $ (125,501) Less: equity earnings from unconsolidated investment

                                                     -              3,058                    -               3,058

Add: total distributions from unconsolidated
investment                                                     -              7,105                    -               7,105
Add: interest expense, net                                    15                  -               10,314              10,329

Add: depreciation, depletion and amortization              2,062                  -                    -               2,062
Add: asset impairments                                   132,283                  -                    -             132,283
Adjusted EBITDA                                      $    25,881           $  7,076          $    (3,621)         $   29,336

June 30, 2019
Net income (loss) from continuing operations         $    53,707           $ 11,333          $   (45,934)         $   19,106
Less: equity earnings from unconsolidated
investment                                                     -            (11,333)                   -             (11,333)

Add: total distributions from unconsolidated
investment                                                     -              9,310                    -               9,310
Add: interest expense, net                                     -                  -               12,456              12,456

Add: loss on extinguishment of debt                            -                  -               29,282              29,282
Add: depreciation, depletion and amortization              3,970                  -                    -               3,970

Adjusted EBITDA                                      $    57,677           $  9,310          $    (4,196)         $   62,791



Adjusted EBITDA decreased $33.5 million primarily due to the following:
•Coal Royalty and Other Segment
•Adjusted EBITDA decreased $31.8 million primarily as a result of the decrease
in revenues and other income driven by the weakened coal markets in the second
quarter of 2020 as compared to the second quarter of 2019, partially offset by
the decrease in operating and maintenance expenses as discussed above.
•Soda Ash Segment
•Adjusted EBITDA decreased $2.2 million as a result of lower cash distributions
received from Ciner Wyoming in second quarter of 2020 as compared to the second
quarter of 2019.

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Distributable Cash Flow ("DCF") and Free Cash Flow ("FCF") (Non-GAAP Financial
Measures)
The following table presents the three major categories of the statement of cash
flows by business segment:
                                                              Operating Segments
                                                     Coal Royalty                          Corporate and
For the Three Months Ended (In thousands)              and Other           Soda Ash          Financing             Total
June 30, 2020
Cash flow provided by (used in) continuing
operations
Operating activities                                $     31,953          $ 7,077          $   (19,095)         $ 19,935
Investing activities                                         365                -                    -               365
Financing activities                                           -                -               (9,978)           (9,978)

June 30, 2019
Cash flow provided by (used in) continuing
operations
Operating activities                                $     55,811          $ 9,310          $   (11,762)         $ 53,359
Investing activities                                         698                -                    -               698
Financing activities                                           -                -              (97,989)          (97,989)

The following table reconciles net cash provided by (used in) operating activities of continuing operations (the most comparable GAAP financial measure) by business segment to DCF and FCF:


                                                               Operating 

Segments


                                                      Coal Royalty                          Corporate and
For the Three Months Ended (In thousands)               and Other           Soda Ash          Financing             Total
June 30, 2020
Net cash provided by (used in) operating
activities of continuing operations                  $     31,953

$ 7,077 $ (19,095) $ 19,935



Add: proceeds from asset sales and disposals                  507                -                    -               507

Add: return of long-term contract receivable                  858                -                    -               858

Distributable cash flow                              $     33,318          $ 7,077          $   (19,095)         $ 21,300
Less: proceeds from asset sales and disposals                (507)               -                    -              (507)

Less: acquisition costs                                    (1,000)               -                    -            (1,000)

Free cash flow                                       $     31,811          $ 7,077          $   (19,095)         $ 19,793

June 30, 2019
Net cash provided by (used in) operating
activities of continuing operations                  $     55,811

$ 9,310 $ (11,762) $ 53,359



Add: proceeds from sale of assets                             247                -                    -               247
Add: proceeds from sale of discontinued
operations                                                      -                -                    -               (44)
Add: return of long-term contract receivable                  451                -                    -               451

Distributable cash flow                              $     56,509          $ 9,310          $   (11,762)         $ 54,013
Less: proceeds from sale of assets                           (247)               -                    -              (247)
Less: proceeds from sale of discontinued
operations                                                      -                -                    -                44

Free cash flow                                       $     56,262          $ 9,310          $   (11,762)         $ 53,810







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DCF and FCF decreased $32.7 million and $34.0 million, respectively, primarily
due to the following:
•Coal Royalty and Other Segment
•DCF and FCF decreased $23.2 million and $24.5 million, respectively, primarily
as a result of the weakened coal markets in the second quarter of 2020.
•Soda Ash Segment
•DCF and FCF decreased $2.2 million as a result of lower cash distributions
received from Ciner Wyoming in the second quarter of 2019.
•Corporate and Financing Segment
•DCF and FCF decreased $7.3 million primarily due to the timing of interest
payments on our parent company bonds that were refinanced in the second quarter
of 2019. Interest is due in June and December on the new 9.125% Notes, compared
to March and September on the previous 10.5% Notes.


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Results of Operations
First Six Months of 2020 and 2019 Compared
Revenues and Other Income
The following table includes our revenues and other income by operating segment:
                                                For the Six Months Ended June
                                                             30,                                                               Percentage
Operating Segment (In thousands)                   2020                2019                                  Decrease            Change
Coal Royalty and Other                         $  68,011           $ 125,495          $ (57,484)                   (46) %
Soda Ash                                           3,214              23,015            (19,801)                   (86) %
Total                                          $  71,225           $ 148,510          $ (77,285)                   (52) %


The changes in revenues and other income is discussed for each of the operating segments below:


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Coal Royalty and Other
The following table presents coal sales volumes, coal royalty revenue per ton
and coal royalty revenues by major coal producing region, the significant
categories of other revenues and other income:
                                                   For the Six Months Ended 

June


                                                                30,                                              Increase           Percentage
(In thousands, except per ton data)                   2020                2019                                  (Decrease)            Change
Coal sales volumes (tons)
Appalachia
Northern                                                414               2,484             (2,070)                     (83) %
Central                                               5,396               7,247             (1,851)                     (26) %
Southern                                                648                 734                (86)                     (12) %
Total Appalachia                                      6,458              10,465             (4,007)                     (38) %
Illinois Basin                                        1,083               1,095                (12)                      (1) %
Northern Powder River Basin                             867               1,447               (580)                     (40) %

Total coal sales volumes                              8,408              13,007             (4,599)                     (35) %

Coal royalty revenue per ton
Appalachia
Northern                                          $    2.01           $    2.19          $   (0.18)                      (8) %
Central                                                4.47                6.03              (1.56)                     (26) %
Southern                                               4.68                7.60              (2.92)                     (38) %

Illinois Basin                                         3.08                4.64              (1.56)                     (34) %
Northern Powder River Basin                            3.75                2.66               1.09                       41  %

Combined average coal royalty revenue per ton          4.11                4.89              (0.78)                     (16) %

Coal royalty revenues
Appalachia
Northern                                          $     831           $   5,438          $  (4,607)                     (85) %
Central                                              24,124              43,699            (19,575)                     (45) %
Southern                                              3,034               5,578             (2,544)                     (46) %
Total Appalachia                                     27,989              54,715            (26,726)                     (49) %
Illinois Basin                                        3,336               5,081             (1,745)                     (34) %
Northern Powder River Basin                           3,248               3,855               (607)                     (16) %

Unadjusted coal royalty revenues                     34,573              63,651            (29,078)                     (46) %
Coal royalty adjustment for minimum leases (1)       (4,624)               (817)            (3,807)                    (466) %
Total coal royalty revenues                       $  29,949           $  62,834          $ (32,885)                     (52) %

Other revenues
Production lease minimum revenues (1)             $   9,287           $  18,579          $  (9,292)                     (50) %
Minimum lease straight-line revenues (1)              8,796               7,170              1,626                       23  %
Property tax revenues                                 2,360               2,810               (450)                     (16) %
Wheelage revenues                                     3,788               3,360                428                       13  %
Coal overriding royalty revenues                      2,005               7,974             (5,969)                     (75) %
Lease amendment revenues                              1,733               5,185             (3,452)                     (67) %

Aggregates royalty revenues                             847               2,701             (1,854)                     (69) %
Oil and gas royalty revenues                          3,845               2,201              1,644                       75  %
Other revenues                                          489               1,304               (815)                     (63) %
Total other revenues                              $  33,150           $  51,284          $ (18,134)                     (35) %
Coal royalty and other                            $  63,099           $ 114,118          $ (51,019)                     (45) %
Transportation and processing services revenues       4,447              10,875             (6,428)                     (59) %
Gain on asset sales and disposals                       465                 502                (37)                      (7) %
Total Coal Royalty and Other segment revenues and
other income                                      $  68,011           $ 125,495          $ (57,484)                     (46) %



(1)Beginning April 1, 2020 and effective January 1, 2020, certain revenues previously classified as coal royalty revenues are classified as production lease minimum revenues or minimum lease straight-line revenues due to contract modifications that fixed consideration paid to us over a two-year period.


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Coal Royalty Revenues
Total coal royalty revenues decreased $32.9 million from 2019 to 2020 primarily
driven by weakened coal markets that resulted in lower coal sales volume. The
discussion of these decreases by region is as follows:
•Appalachia: Sales volumes decreased 38% and revenues decreased $26.7 million
primarily due to weakened coal demand compounded by the COVID-19 pandemic.
•Illinois Basin: Sales volumes decreased 1% and coal royalty revenues decreased
$1.7 million primarily due to weakened coal demand compounded by the COVID-19
pandemic.
•Northern Powder River Basin: Sales volumes decreased 40% and coal royalty
revenues decreased $0.6 million primarily due to our lessee mining off of our
property in accordance with its mine plan in 2020, partially offset by
a 41% increase in sales prices as compared to the prior year.
Other Revenues
Other revenues decreased $18.1 million primarily due to the following:
•A $9.3 million decrease in production lease minimum revenues primarily as a
result of Macoupin lease amendment and lessee forfeitures of recoupable balances
in the second quarter of 2019 from minimums paid in prior periods;
•A $6.0 million decrease in coal overriding royalty revenues primarily driven by
lower activity at our Williamson property in the Illinois Basin.
•A $3.5 million decrease in lease amendment revenues year-over-year.
Transportation and Processing Services Revenues
Transportation and processing services revenues decreased $6.4 million primarily
due to idling of the Macoupin mine where we own loadout and other transportation
assets.
Soda Ash

Revenues and other income related to our Soda Ash segment decreased $19.8 million compared to the prior year primarily due to a combination of lower pricing and volumes sold. Ciner Wyoming was negatively impacted by the COVID-19 pandemic as lower activity in the global auto, container and construction industries reduced demand for glass and soda ash.


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Operating and Other Expenses
The following table presents the significant categories of our consolidated
operating and other expenses:
                                                  For the Six Months Ended June
                                                               30,                                                               Percentage
(In thousands)                                        2020               2019                                  Decrease            Change
Operating expenses
Operating and maintenance expenses               $   13,419           $ 20,819          $  (7,400)                   (36) %
Depreciation, depletion and amortization              4,074              8,362             (4,288)                   (51) %
General and administrative expenses                   7,534              8,546             (1,012)                   (12) %
Asset impairments                                   132,283                  -            132,283                    100  %
Total operating expenses                         $  157,310           $ 37,727          $ 119,583                    317  %

Other expenses, net
Interest expense, net                            $   20,637           $ 26,630          $  (5,993)                   (23) %

Loss on extinguishment of debt                            -             29,282            (29,282)                  (100) %

Total other expenses, net                        $   20,637           $ 55,912          $ (35,275)                   (63) %



Total operating expenses increased $119.6 million primarily due to the
following:
•Asset impairments increased $132.3 million due to weakened coal markets that
resulted in termination of certain coal leases, changes to lessee mine plans
resulting in permanent moves off certain of our coal properties and decreased
oil and gas drilling activity which negatively impacted the outlook for NRP's
frac sand properties.
•Operating and maintenance expenses decreased $7.4 million primarily due to a
decrease in bad debt expense in addition to lower royalty fees related to an
overriding royalty agreement with Western Pocahontas Properties Limited
Partnership ("WPPLP"). The coal royalty expense NRP pays to WPPLP is fully
offset by the coal royalty revenue NRP receives from this property.
•Depreciation, depletion and amortization expense decreased $4.3 million
primarily due to lower coal sales volumes at certain properties.
Total other expenses, net decreased $35.3 million primarily due to the
following:
•Loss on extinguishment of debt of $29.3 million in 2019 related to the 105.25%
premium paid to redeem the 2022 Senior Notes in the second quarter of 2019 as
well as the write-off of unamortized debt issuance costs and debt discount
related to the 2022 Senior Notes.
•Interest expense, net decreased $6.0 million primarily due to lower debt
balances during the first six months of 2020 as a result of debt repayments made
over the past twelve months.

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Adjusted EBITDA (Non-GAAP Financial Measure)
The following table reconciles net income (loss) from continuing operations (the
most comparable GAAP financial measure) to Adjusted EBITDA by business segment:
                                                            Operating Segments
                                                      Coal Royalty                          Corporate and
For the Six Months Ended (In thousands)                and Other           Soda Ash           Financing              Total
June 30, 2020
Net income (loss) from continuing operations         $   (81,735)         $  3,169          $   (28,156)         $ (106,722)
Less: equity earnings from unconsolidated
investment                                                     -            (3,214)                   -              (3,214)

Add: total distributions from unconsolidated
investment                                                     -            14,210                    -              14,210
Add: interest expense, net                                    15                 -               20,622              20,637

Add: depreciation, depletion and amortization              4,074                 -                    -               4,074
Add: asset impairments                                   132,283                 -                    -             132,283
Adjusted EBITDA                                      $    54,637          $ 14,165          $    (7,534)         $   61,268

June 30, 2019
Net income (loss) from continuing operations         $    96,314          $ 23,015          $   (64,458)         $   54,871
Less: equity earnings from unconsolidated
investment                                                     -           (23,015)                   -             (23,015)

Add: total distributions from unconsolidated
investment                                                     -            19,110                    -              19,110
Add: interest expense, net                                     -                 -               26,630              26,630

Add: loss on extinguishment of debt                            -                 -               29,282              29,282
Add: depreciation, depletion and amortization              8,362                 -                    -               8,362

Adjusted EBITDA                                      $   104,676          $ 19,110          $    (8,546)         $  115,240



Adjusted EBITDA decreased $54.0 million primarily due to the following:
•Coal Royalty and Other Segment
•Adjusted EBITDA decreased $50.0 million primarily as a result of weakened coal
markets in the first six months of 2020.
•Soda Ash Segment
•Adjusted EBITDA decreased $4.9 million as a result of lower cash distributions
received from Ciner Wyoming in the first six months of 2020.

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Distributable Cash Flow ("DCF") and Free Cash Flow ("FCF") (Non-GAAP Financial
Measures)
The following table presents the three major categories of the statement of cash
flows by business segment:
                                                          Operating Segments
                                                    Coal Royalty                          Corporate and
For the Six Months Ended (In thousands)               and Other          Soda Ash           Financing             Total
June 30, 2020
Cash flow provided by (used in) continuing
operations
Operating activities                                $   62,509          $ 14,166          $   (26,585)         $  50,090
Investing activities                                       637                 -                    -                637
Financing activities                                         -                 -              (38,164)           (38,164)

June 30, 2019
Cash flow provided by (used in) continuing
operations
Operating activities                                $   98,727          $ 19,110          $   (41,646)         $  76,191
Investing activities                                     1,395                 -                    -              1,395
Financing activities                                         -                 -             (197,841)          (197,841)


The following table reconciles net cash provided by (used in) operating activities of continuing operations (the most comparable GAAP financial measure) by business segment to DCF and FCF:


                                                            Operating 

Segments


                                                      Coal Royalty                          Corporate and
For the Six Months Ended (In thousands)                and Other           Soda Ash           Financing             Total
June 30, 2020
Net cash provided by (used in) operating
activities of continuing operations                  $    62,509          $ 

14,166 $ (26,585) $ 50,090



Add: proceeds from asset sales and disposals                 507                 -                    -               507
Add: proceeds from sale of discontinued
operations                                                     -                 -                    -               (66)
Add: return of long-term contract receivable               1,130                 -                    -             1,130

Distributable cash flow                              $    64,146          $ 14,166          $   (26,585)         $ 51,661
Less: proceeds from asset sales and disposals               (507)                -                    -              (507)
Less: proceeds from sale of discontinued
operations                                                     -                 -                    -                66
Less: acquisition costs                                   (1,000)                -                    -            (1,000)

Free cash flow                                       $    62,639          $ 14,166          $   (26,585)         $ 50,220

June 30, 2019
Net cash provided by (used in) operating
activities of continuing operations                  $    98,727          $ 19,110          $   (41,646)         $ 76,191
Add: proceeds from asset sales and disposals                 503                 -                    -               503
Add: proceeds from sale of discontinued
operations                                                     -                 -                    -              (434)
Add: return of long-term contract receivable                 892                 -                    -               892
Distributable cash flow                              $   100,122          $ 19,110          $   (41,646)         $ 77,152
Less: proceeds from asset sales and disposals               (503)                -                    -              (503)
Less: proceeds from sale of discontinued
operations                                                     -                 -                    -               434
Free cash flow                                       $    99,619          $ 19,110          $   (41,646)         $ 77,083



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DCF and FCF decreased $25.5 million and $26.9 million, respectively, primarily
due to the following:
•Coal Royalty and Other Segment
•DCF and FCF decreased $36.0 million and $37.0 million, respectively, primarily
as a result of the weakened coal markets in the first six months of 2020.
•Soda Ash Segment
•DCF and FCF decreased $4.9 million as a result of lower cash distributions
received from Ciner Wyoming in the first six months of 2020.
•Corporate and Financing Segment
•DCF and FCF increased $15.1 million primarily due to lower cash paid for
interest as a result of less outstanding debt in the first six months of 2020.
Liquidity and Capital Resources
Current Liquidity
As of June 30, 2020, we had total liquidity of $210.8 million, consisting of
$110.8 million of cash and cash equivalents and $100.0 million of borrowing
capacity under our Opco Credit Facility.
Cash Flows
Cash flows provided by operating activities decreased $24.8 million, from $76.5
million in the six months ended June 30, 2019 to $51.8 million in the six months
ended June 30, 2020 primarily related to lower operating cash flow as a result
of the weakened coal markets in addition to lower cash distributions received
from Ciner Wyoming in the first six months of 2020, partially offset by less
cash paid for interest in the first six months of 2020 due to less debt
outstanding.
Cash flows used in financing activities decreased $158.0 million, from $197.8
million in the six months ended June 30, 2019 to $39.8 million in the six months
ended June 30, 2020 primarily due to the following:
•$345.6 million used for the redemption of our 2022 Senior Notes in the second
quarter of 2019;
•The $49.3 million pre-payment in the first quarter of 2019 related to the sale
of our construction aggregates business;
•$26.2 million in debt issuance costs and other in 2019 primarily related to
2019 debt refinancings; and
•$16.1 million in lower cash distributions in the first six months of 2020 as a
result of the special common unit distribution paid in 2019 and suspending the
common unit distribution in the second quarter of 2020.
These decreases in cash flows used were partially offset by:
•$300 million provided by the issuance of the 2025 Senior Notes in the second
quarter of 2019.
Capital Resources and Obligations
Debt, Net
We had the following debt outstanding as of June 30, 2020 and December 31, 2019:
                                            June 30,       December 31,
(In thousands)                                2020             2019

Current portion of long-term debt, net $ 45,786 $ 45,776 Long-term debt, net

                         452,101            470,422
Total debt, net                           $ 497,887       $    516,198


We have been and continue to be in compliance with the terms of the financial
covenants contained in our debt agreements. For additional information regarding
our debt and the agreements governing our debt, including the covenants
contained therein, see   Note 8. Debt, Net   to the Consolidated Financial
Statements included elsewhere in this Quarterly Report on Form 10-Q.
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Off-Balance Sheet Transactions
We do not have any off-balance sheet arrangements with unconsolidated entities
or related parties and accordingly, there are no off-balance sheet risks to our
liquidity and capital resources from unconsolidated entities.

Related Party Transactions
The information required set forth under   Note 10. Related Party Transactions
to the Consolidated Financial Statements is incorporated herein by reference.

Summary of Critical Accounting Estimates
The preparation of consolidated financial statements in conformity with
generally accepted accounting principles in the United States of America
requires management to make certain estimates and assumptions that affect the
amounts reported in the Consolidated Financial Statements and the accompanying
notes. There have been no significant changes to our critical accounting
estimates from those disclosed in our Annual Report on Form 10-K for the year
ended December 31, 2019.
Recent Accounting Standards
The information set forth under   Note 1. Basis of Presentation   to the
Consolidated Financial Statements is incorporated herein by reference.

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