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Natural Resource Partners LP Message Board

  • ayscuew ayscuew Apr 30, 2013 5:39 PM Flag

    Here is the issue!

    Almost half of NRP's income and revenue comes from met coal, Met coal at this date trades for about $165
    per ton. This is at or below production cost for the miners. NRP can cover the distribution for one or two more quarters. They have $159 million in cash. After that, the payout drops or is eliminated unless met coal price improves. When will the price of met coal head up? THAT IS THE ISSUE.

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    • The "real" issue here is why you are spreading false information..Got a short going? Having a tough day? Considering that Consol Energy just announced that the production costs of met coal produced at its' Buchanan Mine are at $64.42/ton....I think you need to get some updated info...the coal ships are still sailing , and the producers are profitable

      • 3 Replies to ake05bono
      • ake:
        I have no short position. I own more shares than most of the directors. Just looking for information. Appreciate your comments.

      • Met coal prices seem to have fallen quite a bit, and CNX is a good example. From $ 168/ton in Q1 2012 to $ 103/ton in Q1 2013 for the low-vol met coal from Buchanan, a drop in price of just under 40%. The sample size is small, and may not be meaningful to other operators. But the point is that a good part of NRP's royalty income is based on the market price of the coal. A 40% drop in the price of met coal compared to Q1 2012 would really hurt NRP. SunCoke also showed a 30% drop in met coal pricing in Q1 vs last year's Q1. Not a good sign.

        Hello, ayscuew. Thought I'd come back for a visit. I have no idea what to expect for Q1, but I'm interested. PVR's coal royalties dropped almost 33% in Q1 this year vs Q1 of last year, mostly due to lower CAPP production and lower royalty rates - all thermal, so I expected NRP to get hit on both sides, met and thermal. Then ARLP reported absolutely great numbers for Q1 - again, all thermal and mostly Illinois Basin. So I have no idea what to expect for NRP's thermal coal leases. PVR has not been a good indicator of NRP's thermal coal results, but neither has ARLP. CAPP is clearly a disaster and NRP hasn't moved enough into IB to make a difference, I think.

        I haven't tried to follow met coal since I exited NRP last year so maybe I'm missing something.

        We'll see soon enough.

      • And a PS....The massive,multi $Billion Vale Potash project in Argentina has just been postponed indefinitely...NRP's move into potash should now score very well...I don't see any problem collecting distributions for the next several years......

 
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