Natural Resource Partners L.P. (NRP) Acquires Infrastructure Assets and Royalty Interest at Sugar Camp Mine in Illinois Basin; Deal Immediately Accretive
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Natural Resource Partners L.P. (NYSE: NRP) has acquired the rail loadout, associated infrastructure assets and a contractual overriding royalty interest on certain tonnage at the Sugar Camp mine near Benton, Illinois for $58.85 million. The rail loadout and infrastructure assets were purchased from Sugar Camp Energy, LLC and the contractual overriding royalty interest was purchased from Ruger, LLC, both affiliates of the Cline Group. The acquisitions were funded with $17.85 million in cash and the remainder from NRP's credit facility.
NRP will be paid a throughput fee ranging from $1.05 per ton to $1.17 per ton over the first twenty years of the agreement, for all coal produced from the first longwall miner unit and the associated development units. NRP will also be paid the greater of 3% of the gross selling price or $1.14 per ton for the tonnage associated with the contractual override, which has an anticipated life of 7 years. The longwall unit commenced operation in late February and is expected to produce over 5 million tons of coal in 2012.
The transactions are immediately accretive and will add approximately $7.5 million to $8.5 million in additional cash flows to NRP's 2012 distributable cash flow.
NRP will be paid a throughput fee ranging from $1.05 per ton to $1.17 per ton over the first twenty years of the agreement, for all coal produced from the first longwall miner unit and the associated development units. NRP will also be paid the greater of 3% of the gross selling price or $1.14 per ton for the tonnage associated with the contractual override, which has an anticipated life of 7 years. The longwall unit commenced operation in late February and is expected to produce over 5 million tons of coal in 2012.
The transactions are immediately accretive and will add approximately $7.5 million to $8.5 million in additional cash flows to NRP's 2012 distributable cash flow.
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