HOUSTON, June 1, 2005 /PRNewswire-FirstCall via COMTEX/ -- Natural Resource Partners L.P.
(NYSE: NRP) today announced that it has signed a definitive agreement to
purchase interests in approximately 144 million tons in the Illinois Basin for
$105 million in three separate transactions. NRP will acquire approximately
60% of the reserves in fee and will receive an override on the remaining tons.
The reserves are being purchased from Steelhead Development Company, LLC and
are leased to Williamson Energy LLC, both affiliates of Cline Resources &
Development.
The three transactions are subject to customary closing conditions and
specific performance requirements. The first closing for $35 million is
anticipated to occur in the third quarter of this year and is contingent upon
receipt of mining permits. The second closing is anticipated to occur in the
first quarter of 2006 with the third to follow in mid-2006. NRP anticipates
drawing on its credit facility to finance each transaction.
The coal reserves and overriding royalty interest are located on
approximately 31,700 acres in Williamson and Franklin Counties in Illinois.
The purchase of these reserves is associated with the development of a new
longwall mine. The first production is targeted to occur in 2006, and NRP
expects the acquisition to be accretive on a calendar year basis beginning in
2007.
"We have been looking for the right opportunity to expand our holdings in
the Illinois Basin. We are excited to acquire such a great reserve block, but
more importantly, to be able to work with such an outstanding, proven
operator," said Nick Carter, President and Chief Operating Officer.
"This acquisition will provide long-term sustainable cash flows and fits
our objective of acquiring long-life, high quality assets," said Corbin J.
Robertson, Jr., Chairman and Chief Executive Officer.
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 estimated
coal reserves, estimated coal reserves associated with the overriding royalty
interest, the anticipated start of coal production and the accretive nature of
the transaction. All statements, other than statements of historical facts,
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.
SOURCE Natural Resource Partners L.P.
Kathy Hager of Natural Resource Partners L.P., +1-713-751-7555, or khager@nrplp.com
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