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Natural Resource Partners L.P. Increases Distribution and Issues 2005 Guidance

01/20/2005

HOUSTON, Jan. 20 /PRNewswire-FirstCall/ -- Natural Resource Partners L.P. (NYSE: NRP) today announced a 4% increase or $0.025 in its quarterly distribution to $0.6625 per unit. This equates to an annualized distribution of $2.65 per unit. The distribution will be paid on February 14, 2005 to unitholders of record on February 1, 2005. This makes the sixth consecutive quarter that NRP has increased its distribution and represents an 18% increase over the same period last year.

NRP expects another great year in 2005 as coal prices are projected to remain high throughout the year. The partnership expects to generate between $91 million and $101 million in distributable cash flow, net of scheduled principal payments of $9.4 million on NRP's senior notes. NRP anticipates generating net income between $68 million and $78 million.

Production volumes are expected to range between 49.5 million tons and 53.0 million tons, of which 25% are estimated to be metallurgical coal. Coal royalty revenues are expected to range from $115 million to $125 million based on coal royalty revenue per ton of between $2.25 and $2.40. Total revenues are expected to range between $126 million and $138 million.

The following table includes further details regarding guidance for 2005.

Natural Resource Partners L.P. is headquartered in Houston, TX, with its operations headquarters in Huntington, WV. NRP is a master limited partnership that is principally engaged in the business of owning and managing coal properties in the three major coal producing regions of the United States: Appalachia, the Illinois Basin and the Powder River Basin.

For additional information, please contact Kathy Hager at 713-751-7555 or khager@nrplp.com . Further information about NRP is available on the partnership's website at http://www.nrplp.com .

This press release may include "forward-looking statements" as defined by the Securities and Exchange Commission. Such statements include the anticipated coal royalty revenues, coal production, operating expenses, net income and other items listed on the following table. All statements included in this press release that address activities, events or developments that the partnership expects, believes or anticipates will or may occur in the future are forward-looking statements. These statements are based on certain assumptions made by the partnership based on its experience and perception of historical trends, current conditions, expected future developments and other factors it believes are appropriate in the circumstances. Such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of the partnership. These risks include, but are not limited to, decreases in demand for coal; changes in operating conditions and costs; production cuts by our lessees; commodity prices; unanticipated geologic problems; changes in the legislative or regulatory environment and other factors detailed in Natural Resource Partners' Securities and Exchange Commission filings. Natural Resource Partners L.P. has no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

                               - table follows-



                        Natural Resource Partners L.P.
                                   Guidance
            (dollars and tons in millions except per unit amounts)

                                                             Full Year 2005
                                                                 (Range)
    Coal royalty production (tons)
      Appalachia                                             42.5 -     44.5
      Illinois Basin                                          2.0 -      2.5
      Northern Powder River Basin                             5.0 -      6.0
        Total                                                49.5 -     53.0

    Coal royalty revenues
      Appalachia                                         $  105.0 -  $ 114.0
      Illinois Basin                                          2.5 -      3.5
      Northern Powder River Basin                             6.5 -      7.5
        Total                                            $  115.0 -  $ 125.0

    Revenues
      Coal royalty revenues                              $  115.0 -    125.0
      Other revenues (A)                                     11.0 -     13.0

    Expenses
      Depletion and amortization                         $   30.0 -  $  35.0
      General and administrative                             10.0 -     12.0
      Other expenses (B)                                      7.0 -      9.0

    Other expenses
      Interest expense (net)                             $    8.0 -  $   9.0


    Net income                                           $   68.0    $  78.0

    Net income per unit                                  $   2.60 -  $  2.95

    Scheduled principal payments                         $    9.4 -  $   9.4

    Distributable cash flow (C)                          $   91.0 -  $ 101.0



     (A) Other revenues consist of property taxes, minimums, oil & gas,
         timber, overrides, wheelage and rentals.
(B) Other expenses include taxes other than income, override payments, coal royalty payments, and non-participating royalty interests.
(C) Distributable cash flow represents net income plus depletion and amortization minus scheduled principal payments on NRP senior notes. Distributable cash flow is a "non-GAAP financial measure" that is presented because management believes it is a useful adjunct to net cash provided by operating activities under GAAP. Distributable cash flow is a significant liquidity metric that is an indicator of NRP's ability to generate cash flows at a level that can sustain or support an increase in quarterly cash distributions paid to its partners. Distributable cash flow is also the quantitative standard used throughout the investment community with respect to publicly-traded partnerships. Distributable cash flow 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. We believe that "net cash provided by operating activities" would be the most comparable financial measure to distributable cash. However, due to the substantial uncertainties associated with forecasting future changes to operating assets and liabilities, we cannot provide guidance on forward-looking net cash provided by operating activities or provide reconciliations of distributable cash flow to that measure.

SOURCE
Natural Resource Partners L.P. 01/20/2005

CONTACT:
Kathy Hager of Natural Resource Partners L.P.,
1-713-751-7555 or khager@nrplp.com
Web site: http://www.nrplp.com

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