INCOME TAX (Tables)

12 Months Ended

Dec. 31, 2012

Schedule of components of income tax expense (benefit)

Income tax expense (benefit) attributable to net loss before income taxes consists of:



	Year Ended December 31,
	2012			2011			2010
	(In thousands)
Current:
Federal	$	(8	)	$	(174	)	$	(10	)
State	98			168			(14		)
	90			(6		)	(24		)
Deferred:
Federal	—			—			—
State	—			(420		)	(117		)
	—			(420		)	(117		)
Income tax benefit	$	90		$	(426	)	$	(141	)

Schedule of effective income tax rate reconciliation

Income tax benefit attributable to net loss before income taxes differed from the amounts computed by applying the statutory Federal income tax rate of 34% to pre-tax income as a result of the following:



	Year Ended December 31,
	2012			2011			2010
	(In thousands)
Computed tax benefit at statutory rate	$	(4,615	)	$	(12,683	)	$	(1,126	)
Increase (decrease) in tax expense resulting from:
Tax depletion in excess of basis	(4,782		)	(3,820		)	(4,019		)
Non-deductible interest expense and convertible debt valuation	—			3,717			2,076
Noncontrolling interest	2,188			1,283			899
State income taxes, net	(3,427		)	(4,548		)	(1,090		)
Change in valuation allowance for net deferred tax assets	8,571			2,923			(3,331		)
Medicare Part D subsidy law change	—			—			7,159
Indian Coal Tax Credits	83			(122		)	(120		)
Federal and state NOL expiration	153			11,226			19
Other, net	1,919			1,598			(608		)
Income tax benefit	$	90		$	(426	)	$	(141	)

Schedule of components of deferred tax assets and liabilities

The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities are presented below:



	December 31,
	2012			2011
	(In thousands)
Deferred tax assets:
Federal net operating loss carryforwards	$	84,330		$	78,103
State net operating loss carryforwards	28,700			25,209
Alternative minimum tax credit carryforwards	6,973			6,847
Charitable contribution carryforwards	132			156
Indian Coal Tax Credit carryforwards	25,591			25,675
Accruals for the following:
Workers’ compensation	3,592			4,450
Postretirement medical benefit and pension obligations	138,710			101,864
Incentive plans	1,995			1,565
Asset retirement obligations	77,698			70,298
Deferred revenues	22,500			26,053
Gain on sale of partnership interest	—			3,165
Other accruals	9,418			7,292
Total gross deferred assets	399,639			350,677
Less valuation allowance	(293,504		)	(274,681		)
Net deferred tax assets	106,135			75,996
Deferred tax liabilities:
Property, plant and equipment, differences due to depreciation and amortization	(104,992		)	(74,419		)
Change in accounting method	—			(177		)
Other	(1,143		)	(1,400		)
Total gross deferred tax liabilities	(106,135		)	(75,996		)
Net deferred tax asset	$	—		$	—

Summary of available Federal net operating loss carryforwards

As of December 31, 2012, the Company has available Federal net operating loss carryforwards to reduce future regular taxable income, which expire as follows:



Expiration Date	Regular Tax
	(In thousands)
2018	28
2019	88,429
2020	32
2021	20
after 2022	160,078
Total	$	248,587

Schedule of unrecognized tax benefits roll forward

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:



	Year Ended December 31,
	2012		2011
	(In thousands)
Balance of unrecognized tax benefits at beginning of year	$	—	$	2,879
Additions for tax positions related to current year	—		40
Settlements	—		(2,919		)
Balance of unrecognized tax benefits at end of year	$	—	$	—