10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 __________________________________________

FORM 10-Q

 __________________________________________

(Mark One)

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2014

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                 to                 

Commission File No. 001-11155

  ___________________________________________

WESTMORELAND COAL COMPANY

(Exact name of registrant as specified in its charter)

 __________________________________________

Delaware	23-1128670
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
9540 South Maroon Circle, Suite 200 Englewood, CO	80112
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (855) 922-6463

 __________________________________________

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes x No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	o		Accelerated filer	x
Non-accelerated filer	o	(Do not check if a smaller reporting company.)	Smaller reporting company	o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes o No x

Indicate the number of shares outstanding of each of the issuer's classes of common stock as of July 29, 2014: 16,986,656 shares of common stock, $2.50 par value.

TABLE OF CONTENTS

		PAGE
PART I - FINANCIAL INFORMATION		3
ITEM 1 -	FINANCIAL STATEMENTS	3
ITEM 1 -	NOTES TO CONSOLIDATED FINANCIAL STATEMENTS	10
ITEM 2 -	MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	44
ITEM 3 -	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	56
ITEM 4 -	CONTROLS AND PROCEDURES	56
PART II - OTHER INFORMATION		57
ITEM 1 -	LEGAL PROCEEDINGS	57
ITEM 1A -	RISK FACTORS	57
ITEM 2 -	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	65
ITEM 4 -	MINE SAFETY DISCLOSURES	65
ITEM 6 -	EXHIBITS	65
SIGNATURES		66
EXHIBIT INDEX		67

2

PART I - FINANCIAL INFORMATION

ITEM 1

FINANCIAL STATEMENTS

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

Consolidated Balance Sheets

(Unaudited)

	June 30, 2014		December 31, 2013
	(In thousands)
Assets
Current assets:
Cash and cash equivalents	$	40,610	$	61,110
Receivables:
Trade	129,652		66,196
Loan and lease receivable	11,682		—
Contractual third-party reclamation receivables	7,940		8,487
Other	3,182		5,086
	152,456		79,769
Inventories	153,154		39,972
Deferred income taxes	6,053		5,355
Restricted investments and bond collateral	—		5,998
Other current assets	12,362		12,835
Total current assets	364,635		205,039
Property, plant and equipment:
Land and mineral rights	439,001		278,188
Plant and equipment	832,337		657,696
	1,271,338		935,884
Less accumulated depreciation, depletion and amortization	485,820		445,848
Net property, plant and equipment	785,518		490,036
Loan and lease receivable	85,344		—
Advanced coal royalties	7,134		7,311
Reclamation deposits	75,911		74,921
Restricted investments and bond collateral	104,511		69,235
Contractual third-party reclamation receivables, less current portion	93,956		88,303
Investment in joint venture	33,273		—
Intangible assets, net of accumulated amortization of $14.9 million and $14.1 million at June 30, 2014 and December 31, 2013, respectively	677		1,520
Other assets	32,762		10,320
Total Assets	$	1,583,721	$	946,685

See accompanying Notes to Consolidated Financial Statements.

3

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

Consolidated Balance Sheets (Continued)

(Unaudited)

	June 30, 2014			December 31, 2013
	(In thousands)
Liabilities and Shareholders’ Deficit
Current liabilities:
Current installments of long-term debt	$	42,401		$	44,343
Accounts payable and accrued expenses:
Trade and other accrued liabilities	128,338			57,507
Interest payable	30,750			11,321
Production taxes	42,673			41,905
Workers’ compensation	707			717
Postretirement medical benefits	13,955			13,955
SERP	390			390
Deferred revenue	11,561			14,068
Asset retirement obligations	31,131			23,353
Other current liabilities	11,973			5,469
Total current liabilities	313,879			213,028
Long-term debt, less current installments	790,643			295,494
Workers’ compensation, less current portion	6,629			6,744
Excess of black lung benefit obligation over trust assets	9,841			8,675
Postretirement medical benefits, less current portion	271,773			270,374
Pension and SERP obligations, less current portion	22,222			24,176
Deferred revenue, less current portion	40,676			46,567
Asset retirement obligations, less current portion	358,253			256,511
Intangible liabilities, net of accumulated amortization of $13.0 million and $12.4 million at June 30, 2014 and December 31, 2013, respectively	5,072			5,606
Deferred income taxes	15,514			5,355
Other liabilities	9,864			2,034
Total liabilities	1,844,366			1,134,564
Shareholders’ deficit:
Preferred stock of $1.00 par value
Authorized 5,000,000 shares; issued and outstanding 95,769 shares at June 30, 2014 and 159,960 at December 31, 2013	96			160
Common stock of $2.50 par value
Authorized 30,000,000 shares; issued and outstanding 15,269,637 shares at June 30, 2014 and 14,592,231 shares at December 31, 2013	38,173			36,479
Other paid-in capital	133,140			134,861
Accumulated other comprehensive loss	(53,615		)	(63,595		)
Accumulated deficit	(378,439		)	(295,784		)
Total shareholders’ deficit	(260,645		)	(187,879		)
Total Liabilities and Shareholders’ Deficit	$	1,583,721		$	946,685

See accompanying Notes to Consolidated Financial Statements.

4

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

Consolidated Statements of Operations

(Unaudited)

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
	(In thousands, except per share data)
Revenues	$	287,956		$	162,499		$	468,159		$	323,947
Cost, expenses and other:
Cost of sales	248,389			130,528			387,019			260,949
Depreciation, depletion and amortization	24,479			15,397			40,538			29,823
Selling and administrative	28,709			11,969			42,040			23,855
Heritage health benefit expenses	3,388			3,109			6,932			7,060
Gain on sales of assets	(43		)	(74		)	(5		)	(308		)
Restructuring charges	7,543			—			7,941			—
Derivative loss	5,930			—			5,930			—
Income from equity affiliates	(799		)	—			(799		)	—
Other operating loss (income)	—			(10,405		)	151			(15,142		)
	317,596			150,524			489,747			306,237
Operating income (loss)	(29,640		)	11,975			(21,588		)	17,710
Other income (expense):
Interest expense	(21,786		)	(10,076		)	(42,584		)	(20,236		)
Loss on extinguishment of debt	(12,635		)	(64		)	(12,635		)	(64		)
Interest income	1,582			280			1,884			577
Gain (loss) on foreign exchange	2,649			—			(4,141		)	—
Other income	483			130			576			198
	(29,707		)	(9,730		)	(56,900		)	(19,525		)
Income (loss) before income taxes	(59,347		)	2,245			(78,488		)	(1,815		)
Income tax expense	3,807			28			3,697			55
Net income (loss)	(63,154		)	2,217			(82,185		)	(1,870		)
Less net income attributable to noncontrolling interest	—			2,499			—			797
Net loss attributable to the Parent company	(63,154		)	(282		)	(82,185		)	(2,667		)
Less preferred stock dividend requirements	209			340			470			680
Net loss applicable to common shareholders	$	(63,363	)	$	(622	)	$	(82,655	)	$	(3,347	)
Net loss per share applicable to common shareholders:
Basic and diluted	$	(4.19	)	$	(0.04	)	$	(5.52	)	$	(0.23	)
Weighted average number of common shares outstanding
Basic and diluted	15,136			14,495			14,962			14,389

See accompanying Notes to Consolidated Financial Statements.

5

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

Consolidated Statements of Comprehensive Income (Loss)

(Unaudited)

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
	(In thousands)
Net income (loss)	$	(63,154	)	$	2,217		$	(82,185	)	$	(1,870	)
Other comprehensive income (loss):
Pension and other postretirement plans:
Amortization of accumulated actuarial gains or losses, pension	359			1,004			717			1,745
Amortization of accumulated actuarial gains or losses, transition obligations, and prior service costs, postretirement medical benefit	5			1,001			10			2,002
Tax effect of other comprehensive income gains	64			—			(224		)	—
Change in foreign currency translation adjustment	9,477			—			9,477			—
Unrealized and realized gains and losses on available-for-sale securities	—			(39		)	—			(39		)
Other comprehensive income	9,905			1,966			9,980			3,708
Comprehensive income (loss) attributable to the Parent company	$	(53,249	)	$	4,183		$	(72,205	)	$	1,838

See accompanying Notes to Consolidated Financial Statements.

6

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

Consolidated Statements of Shareholders’ Deficit

Six Months EndedJune 30, 2014

(Unaudited)

	Preferred Stock					Common Stock			Other Paid-In Capital			Accumulated Other Comprehensive Loss			Accumulated Deficit			Total Shareholders’ Deficit
	Shares		Amount			Shares	Amount
	(In thousands, except shares data)
Balance at December 31, 2013	159,960		$	160		14,592,231	$	36,479	$	134,861		$	(63,595	)	$	(295,784	)	$	(187,879	)
Preferred dividends declared	—		—			—	—		—			—			(470		)	(470		)
Common stock issued as compensation	—		—			9,773	24		2,421			—			—			2,445
Common stock options exercised	—		—			9,000	23		170			—			—			193
SARs exercised	—		—			8,352	21		(21		)	—			—			—
Conversion of convertible notes and securities	(64,191	)	(64		)	438,526	1,097		(1,033		)	—			—			—
Issuance of restricted stock	—		—			211,755	529		(3,258		)	—			—			(2,729		)
Net loss	—		—			—	—		—			—			(82,185		)	(82,185		)
Other comprehensive income	—		—			—	—		—			9,980			—			9,980
Balance at June 30, 2014	95,769		$	96		15,269,637	$	38,173	$	133,140		$	(53,615	)	$	(378,439	)	$	(260,645	)

See accompanying Notes to Consolidated Financial Statements.

7

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

Consolidated Statements of Cash Flows

(Unaudited)

	Six Months Ended June 30,
	2014			2013
	(In thousands)
Cash flows from operating activities:
Net loss	$	(82,185	)	$	(1,870	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation, depletion and amortization	40,538			29,823
Accretion of asset retirement obligation and receivable	9,288			6,338
Non-cash tax benefits	(224		)	—
Amortization of intangible assets and liabilities, net	310			326
Share-based compensation	2,445			3,771
Gain on sales of assets	(5		)	(308		)
Amortization of deferred financing costs	1,209			1,856
Loss on extinguishment of debt	12,635			64
Loss (gain) on sales of investment securities	3			(28		)
Loss on derivative	5,930			—
Loss on foreign exchange	4,141			—
Income from equity affiliates	(799		)	—
Distributions from equity affiliates	730			—
Changes in operating assets and liabilities:
Receivables, net	(11,270		)	3,687
Inventories	22,770			(1,977		)
Excess of black lung benefit obligation over trust assets	1,166			(281		)
Deferred income tax	3,854			—
Accounts payable and accrued expenses	8,538			1,701
Deferred revenue	(8,424		)	(6,214		)
Income tax payable	528			(56		)
Accrual for workers’ compensation	(125		)	(284		)
Asset retirement obligations	(3,362		)	(5,424		)
Accrual for postretirement medical benefits	1,409			4,094
Pension and SERP obligations	(332		)	1,517
Other assets and liabilities	1,805			(1,811		)
Net cash provided by operating activities	10,573			34,924
Cash flows from investing activities:
Additions to property, plant and equipment	(17,361		)	(13,467		)
Change in restricted investments and bond collateral and reclamation deposits	(30,517		)	(8,714		)
Cash payments related to Canadian Acquisition	(322,637		)	—
Cash acquired related to Canadian Acquisition, net	8,103			—
Net proceeds from sales of assets	213			577
Proceeds from the sale of restricted investments	246			6,807
Increase in loan and lease receivable	(1,120		)	—
Receipts from loan and lease receivable	2,164			—
Receivable from customer for property and equipment purchases	—			(308		)
Other	(82		)	—
Net cash used in investing activities	(360,991		)	(15,105		)
Cash flows from financing activities:
Change in book overdrafts	1,605			1,777
Borrowings from long-term debt, net of debt premium	454,219			—
Repayments of long-term debt	(97,538		)	(16,070		)
Borrowings on revolving lines of credit	10,000			6,000
Repayments on revolving lines of credit	(10,000		)	(6,000		)
Debt issuance costs and other refinancing costs	(27,053		)	(182		)

8

Preferred dividends paid	(470		)	(680		)
Exercise of stock options	193			—
Net cash provided by (used in) financing activities	330,956			(15,155		)
Effect of foreign exchange rates on cash	(1,038		)	—
Net increase (decrease) in cash and cash equivalents	(20,500		)	4,664
Cash and cash equivalents, beginning of period	61,110			31,610
Cash and cash equivalents, end of period	$	40,610		$	36,274

See accompanying Notes to Consolidated Financial Statements.

9

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

1.    BASIS OF PRESENTATION

The accompanying unaudited consolidated financial statements include accounts of Westmoreland Coal Company, or the Company, or Parent, and its subsidiaries and controlled entities. The Company’s current principal activities are conducted within the United States and Canada. U.S. activities include the production and sale of coal from its mines in Montana, Wyoming, North Dakota and Texas, and the ownership of the Roanoke Valley power plants, or ROVA, in North Carolina. Canadian activities include the production and sale of coal from six surface mines in Alberta and Saskatchewan, selling char to the barbecue briquette industry, and a 50% interest in a joint venture which produces activated carbon for the removal of flue gas. The Company’s activities are primarily conducted through wholly owned subsidiaries. All intercompany transactions and accounts have been eliminated in consolidation.

U.S. Operations – The Company’s Kemmerer Mine is owned by its subsidiary Westmoreland Kemmerer, Inc., or Kemmerer. The Company’s Absaloka Mine is owned by its subsidiary Westmoreland Resources, Inc., or WRI. The Beulah, Jewett, Rosebud, and Savage Mines are owned through the Company’s subsidiary Westmoreland Mining LLC, or WML.

Canadian Operations – Prairie Mines & Royalty ULC, or PMRU, operates five surface coal mines in Alberta and Saskatchewan. PMRU owns and operates the Paintearth, Sheerness, Genesee, Poplar River and Estevan mines. PMRU directly owns a 50% joint venture interest in the Bienfait Activated Carbon Joint Venture, at the Estevan mine, which produces activated carbon for the removal of mercury from flue gas. PMRU also sells char to the barbecue briquette industry. Coal Valley Resources Inc., or CVRI, operates the Coal Valley Mine which is a surface mine located in West Central Alberta where the majority of coal is exported overseas to Asian utility companies and commodity traders. CVRI operated the Obed Mountain surface mine, which ceased production in 2013 and is currently in reclamation.

The consolidated financial statements of the Company have been prepared in accordance with United States generally accepted accounting principles and require use of management’s estimates. The financial information contained in this Form 10-Q is unaudited, but reflects all adjustments, which are, in the opinion of management, necessary for a fair presentation of the financial information for the periods shown. Such adjustments are of a normal recurring nature. The results of operations for the six months ended June 30, 2014 are not necessarily indicative of results to be expected for the year ending December 31, 2014.

These quarterly consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2013, or the 2013 Form 10-K. The accounting principles followed by the Company are set forth in the Notes to the Company’s consolidated financial statements in its 2013 Form 10-K. Most of the descriptions of the accounting principles and other footnote disclosures previously made have been omitted in this report so long as the interim information presented is not misleading or inconsistent.

Debt Obligations

The Company is subject to one major debt arrangement of $675.5 million in aggregate principal amount of 10.75% senior secured notes at the Parent level that are collateralized by substantially all of the assets of the Company.

Business Interruption Insurance

The Company received business interruption insurance proceeds for the six months ended June 30, 2014 due to an explosion and subsequent fire at a customer’s facility that occurred in November 2011. Operations at that facility resumed during October 2013. The Company recognizes income as business interruption losses are incurred and reimbursement is virtually assured. The Company reports this income in Other operating income and recognized nil and $11.3 million of income for the six months ended June 30, 2014 and 2013, respectively. The Company received $4.6 million of cash proceeds for the six months ended June 30, 2014 related to income recorded in 2013. Insurance proceeds are included in Net cash provided by operating activities. As of June 30, 2014, the Company has collected all cash proceeds related to income recognized.

10

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONT.)

Inventories

Inventories, which include materials and supplies as well as raw coal, are stated at the lower of cost or market. Cost is determined using the average cost method. Coal inventory costs include labor, supplies, equipment, depreciation, depletion, amortization, operating overhead and other related costs.

Derivatives

The Company enters into financial derivatives to manage exposure to fluctuations in foreign currency exchange rates and power prices. The Company does not utilize derivative financial instruments for trading purposes or for speculative purposes.

The Company’s derivative instruments are recorded at fair value with changes in fair value recognized in the Consolidated Statements of Operations at the end of each period in Gain (loss) on foreign exchange or Derivative loss.

Equity-Method Investments

The Company's 50% interest in the Bienfait Activated Carbon Joint Venture is accounted for under the equity method of accounting. Investments in unconsolidated affiliates that the Company has the ability to exercise significant influence over, but not control, are accounted for under the equity method of accounting. Under the equity method of accounting, the Company records its proportionate share of the entity’s net income or loss at each reporting period in Income from equity affiliates on the Consolidated Statements of Operations with a corresponding entry to increase or decrease the carrying value of the investment.

Loan and Lease Receivable

The Company periodically makes loans and finance leases at the Genesee mine in accordance with its operating agreement with its only customer for purposes of funding capital expenditures and working capital requirements. Finance lease and loan receivables are measured at the present value of the future lease payments at the inception of the arrangement. Lease payments received are comprised of a repayment of principal and finance income. Finance income is recognized based on the interest rate implicit in the finance lease. PMRU recognizes finance income over periods between 3 and 27 years, which reflect a constant periodic return on its net investment in the finance lease. Initial direct costs are included in the initial measurement of the finance lease receivable and reduce the amount of income recognized over the lease term.

Income Taxes

The Company’s effective tax rate in the six months ended June 30, 2014, was lower than the effective tax rate in the six months ended June 30, 2013, primarily due to the forecasted 2014 decrease in pre-tax loss and the related income tax expense from the Canadian Acquisition.

For the six months ended June 30, 2014, the Company’s effective tax rate differs from the statutory rate primarily due to the U.S. valuation allowance and foreign operations. For the six months ended June 30, 2013, the Company’s effective tax rate differs from the statutory rate primarily due to the U.S. valuation allowance.

The Company has recorded a $5.8 million liability for unrecognized tax benefits at June 30, 2014 with no liability recorded at December 31, 2013. This liability relates to the utilization of prior losses and is currently under review by taxing authorities. It is reasonably possible that the liability for unrecognized tax benefits will significantly change in the next twelve months upon the taxing authorities concluding the review.

Foreign Currency Translation

The functional currency of the Company’s Canadian operations is the Canadian dollar. The Company’s Canadian operations’ assets and liabilities are translated at period end exchange rates, and revenues and costs are translated using average exchange rates for the period. Foreign currency translation adjustments are reported in Other comprehensive income.

Reclassifications

Certain amounts in prior periods have been reclassified to conform with the presentation of 2014, with no effect on

previously reported net loss, cash flows or shareholders’ deficit. The reclassification affected current assets, current liabilities and noncurrent liabilities on the Consolidated Balance Sheet.

11

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONT.)

Recently Adopted Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2014-09, Revenue from Contracts with Customers, issued as a new Topic, Accounting Standards Codification (ASC) Topic 606. The new revenue recognition standard provides a five-step analysis of transactions to determine when and how revenue is recognized. The core principle of the guidance is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This ASU is effective beginning in fiscal 2017 and can be adopted by the Company either retrospectively or as a cumulative-effect adjustment as of the date of adoption. The Company is currently evaluating the effect that adopting this new accounting guidance will have on its consolidated results of operations, cash flows and financial position.

2.    ACQUISITION

On December 24, 2013, the Company entered into an agreement to acquire Sherritt International Corporation’s Prairie and Mountain coal mining operations, collectively referred to as the Canadian Acquisition. On April 28, 2014, Westmoreland Coal Company consummated the Canadian Acquisition. These operations, referred to as the Canadian operations, include six producing thermal coal mines in the Canadian provinces of Alberta and Saskatchewan, a char production facility, and a 50% interest in an activated carbon plant. The Canadian properties include approximately 649 million tons of total proven or probable coal reserves as of December 31, 2013. The purchase consideration included a $282.8 million initial cash payment made on April 28, 2014, a cash payment for a working capital adjustment of $39.8 million made on June 25, 2014, and assumed liabilities of $330.5 million.

In connection with the Canadian Acquisition: (i) proceeds from a private offering of $425.0 million in aggregate principal amount of 10.75% senior secured notes, or the New Notes, were released from escrow and such notes were automatically exchanged for identical notes issued by Westmoreland and Westmoreland Partners, as co-issuers; (ii) Westmoreland increased its revolving line of credit to $60.0 million; and (iii) Westmoreland Mining LLC, or WML; a wholly owned subsidiary of Westmoreland, provided prepayment notices to holders of its 8.02% senior secured notes due 2018, which notes were prepaid at the end of May 2014. Acquisition related costs of $31.6 million have been expensed for the six months ended June 30, 2014; which includes a $13.6 million charge to cost of sales related to the sale of inventory written up to fair value in the acquisition, $6.9 million of expenses included in Selling and administrative costs, $6.2 million of loss on foreign exchange as described in Note 10, and $4.9 million included in Interest expense related to a bridge facility commitment fee.

The Canadian Acquisition has been accounted for under the acquisition method of accounting that requires the total purchase consideration to be allocated to the assets acquired and liabilities assumed based on estimates of fair value.

The allocation of the purchase price is preliminary pending the completion of various analyses and the finalization of estimates. During the measurement period (which is not to exceed one year from the acquisition date), additional assets or liabilities may be recognized if new information is obtained about facts and circumstances that existed as of the acquisition date that, if known, would have resulted in the recognition of those assets or liabilities as of that date. The preliminary allocation may be adjusted after obtaining additional information regarding, among other things, asset valuations, liabilities assumed and revisions of previous estimates. These adjustments may be significant and will be accounted for retrospectively.

12

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONT.)

A summary of the purchase consideration and a preliminary allocation of the purchase consideration follows (in millions):

Purchase Price:
Cash paid - Initial payment	$	282.8
Cash paid - Working capital adjustment	39.8
Total cash consideration	$	322.6
Preliminary allocation of purchase price:
Assets:
Cash and cash equivalents	$	26.2
Trade receivables	49.9
Inventories - materials and supplies	52.0
Inventories - coal	79.8
Leases and loans receivable	11.2
Deferred tax assets	6.7
Other current assets	3.4
Total current assets	229.2
Land and mineral rights	151.3
Plant and equipment	171.7
Leases and loans receivable	83.8
Contractual third-party reclamation receivables, less current portion	6.8
Other assets	10.3
Total Assets	653.1
Liabilities:
Current installments of long-term debt	(36.3		)
Trade payables and other accrued liabilities	(93.7		)
Asset retirement obligations	(9.7		)
Total current liabilities	(139.7		)
Long-term debt, less current installments	(86.3		)
Asset retirement obligations, less current portion	(92.4		)
Deferred tax liabilities	(12.1		)
Total Liabilities	(330.5		)
Net fair value	$	322.6

The $26.2 million of cash and cash equivalents noted above includes $18.1 million which was used for immediate payment of an assumed liability on the acquisition date, leaving $8.1 million of net cash received upon the acquisition.

The results of operations of the Canadian operations from the acquisition date of April 28, 2014 have been included in the Company's consolidated results of operations for the three and six months ended June 30, 2014. The Canadian operations generated $116.0 million of revenue and $12.7 millionof operating loss since the April 28, 2014 acquisition date.

The following unaudited pro forma information has been prepared for illustrative purposes only and assumes the acquisition occurred on January 1, 2013. The unaudited pro forma results have been prepared based on estimates and assumptions, which the Company believes are reasonable, however, they are not necessarily indicative of the consolidated results of operations had the acquisition occurred on January 1, 2013, or of future results of operations.

13

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONT.)

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
Total Revenues	(In thousands, except per share data)
As reported	$	287,956		$	162,499		$	468,159		$	323,947
Pro forma	$	320,761		$	356,962		$	674,378		$	672,735
Operating Income
As reported	$	(29,640	)	$	11,975		$	(21,588	)	$	17,710
Pro forma	$	(50,032	)	$	17,081		$	(14,433	)	$	30,105
Net loss applicable to common shareholders
As reported	$	(63,363	)	$	(622	)	$	(82,655	)	$	(3,347	)
Pro forma	$	(89,247	)	$	(4,167	)	$	(97,509	)	$	(9,131	)
Net loss per share applicable to common shareholders
As reported	$	(4.19	)	$	(0.04	)	$	(5.52	)	$	(0.23	)
Pro forma	$	(5.90	)	$	(0.29	)	$	(6.52	)	$	(0.63	)

3.    INVENTORIES

Inventories consisted of the following:

	June 30, 2014			December 31, 2013
	(In thousands)
Coal stockpiles	$	61,663		$	543
Coal fuel inventories	5,319			6,161
Materials and supplies	86,946			34,233
Reserve for obsolete inventory	(774		)	(965		)
Total	$	153,154		$	39,972

14

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONT.)

4.    RESTRICTED INVESTMENTS AND BOND COLLATERAL

The Company’s restricted investments and bond collateral consist of the following:

	June 30, 2014		December 31, 2013
	(In thousands)
Coal - U.S. Segment:
WML debt reserve account	$	—	$	13,067
Reclamation bond collateral:
Kemmerer Mine	25,077		24,966
Absaloka Mine	11,696		11,653
Rosebud Mine	3,145		3,145
Beulah Mine	1,270		1,270
Coal - Canada Segment:
PMRU	16,201		—
CVRI	31,867		—
Power Segment:
Letter of credit account	—		5,998
Corporate Segment:
Postretirement medical benefit bonds	8,550		8,467
Workers’ compensation bonds	6,705		6,667
Total restricted investments and bond collateral	104,511		75,233
Less current portion	—		(5,998		)
Total restricted investments and bond collateral, less current portion	$	104,511	$	69,235

For all of its restricted investments and bond collateral accounts, the Company can select from limited fixed-income investment options for the funds and receive the investment returns on these investments. Funds in the restricted investments and bond collateral accounts are not available to meet the Company’s general cash needs.

These accounts include held-to-maturity securities. Held-to-maturity securities are recorded at amortized cost, adjusted for the amortization or accretion of premiums or discounts calculated on the effective interest method. Interest income is recognized when earned.

The Company’s carrying value and estimated fair value of its restricted investments and bond collateral at June 30, 2014 are as follows:

	Carrying Value		Fair Value
	(In thousands)
Cash and cash equivalents	$	67,340	$	67,340
Time deposits	2,451		2,451
Held-to-maturity securities	34,720		35,259
	$	104,511	$	105,050

Held-to-Maturity Restricted Investments and Bond Collateral

The amortized cost, gross unrealized holding gains and fair value of held-to-maturity securities at June 30, 2014 is as follows (in thousands):

Amortized cost	$	34,720
Gross unrealized holding gains	628
Gross unrealized holding losses	(89		)
Fair value	$	35,259

15

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONT.)

Maturities of held-to-maturity securities are as follows at June 30, 2014:

	Amortized Cost		Fair Value
	(In thousands)
Due within one year	$	1,212	$	1,230
Due in five years or less	19,360		19,704
Due after five years to ten years	8,897		9,070
Due in more than ten years	5,251		5,255
	$	34,720	$	35,259

The Company does not intend to sell its held-to-maturity securities and it is not more likely than not that the Company will be required to sell the securities before recovery of amortized cost bases, which may be at maturity.

As of February 2014, the Company is no longer required to fund a letter of credit account for its power operations.

5. RESTRUCTURING CHARGES

In 2013, the Company entered into an agreement with Dominion Virginia Power, a subsidiary of Dominion, to restructure the remaining 5 years of the ROVA contract. The Company recorded a restructuring charge for additional contractual obligations of $0.1 million and $0.5 million for the three and six months ended June 30, 2014, respectively. The Company expects that the $5.1 million of accruals will be paid out by the end of 2014.

The table below represents the restructuring provision activity related to the ROVA restructuring affecting our Power segment during the six months ended June 30, 2014 (in millions):

Beginning Balance		Restructuring Charges		Restructuring Payments		Ending Balance
$	5.1	$	0.5	$	0.5	$	5.1

During the second quarter of 2014, the Company initiated strategic changes related to the Canadian Acquisition. The restructuring actions are expected to be completed in 2014. The Company recorded a restructuring charge for one-time employee termination benefits of $8.0 million for the three and six months ended June 30, 2014 and expects that accruals will be paid through 2016.

The table below represents the restructuring provision activity related to the Canadian Acquisition affecting our Coal - Canada and Coal - US segments during the six months ended June 30, 2014 (in millions):

Beginning Balance		Restructuring Charges		Restructuring Payments		Ending Balance
$	—	$	8.0	$	0.4	$	7.6

16

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONT.)

6.    LINES OF CREDIT AND DEBT

The amounts outstanding under the Company’s debt consisted of the following as of the dates indicated:

	Total Debt Outstanding
	June 30, 2014			December 31, 2013
	(In thousands)
10.75% Senior Notes due 2018	$	250,485		$	251,500
Add-On Notes - 10.75% senior notes due 2018	425,000			—
8.02% WML term debt due 2018	—			85,500
Capital lease obligations	133,240			10,153
Other	5,286			1,209
Debt premium (discount), net	19,033			(8,525		)
Total debt outstanding	833,044			339,837
Less current installments	(42,401		)	(44,343		)
Total debt outstanding, less current installments	$	790,643		$	295,494

The following table presents aggregate contractual debt maturities of all debt:

	As of June 30, 2014
	(In thousands)
2014	$	22,270
2015	41,290
2016	39,318
2017	25,776
2018	682,852
Thereafter	2,505
Total	814,011
Plus: debt premium (discount), net	19,033
Total debt	$	833,044

On February 7, 2014, the Company closed on a private offering of $425.0 million in aggregate principal amount of 10.75% senior notes due 2018 at a price of 106.875% plus accrued interest from February 1, 2014, referred to as the New Notes. Total proceeds of the offering were $454.2 million, which included $29.2 million of debt premium. The net proceeds of the offering of the New Notes were used to finance the $282.8 million initial cash payment for the Canadian Acquisition and cash transaction costs associated with the Canadian Acquisition and offering of the New Notes of approximately $24.0 million. The remaining balance of the proceeds were used to fund the prepayment of the WML Notes and for other general corporate purposes. In connection with the WML prepayment, the WML revolving credit facility was terminated. Upon the prepayment of the WML Notes, WML's assets constitute collateral for the senior notes.

Promptly following the completion of the Canadian Acquisition, the Company exchanged the New Notes for $425 million aggregate principal amount of add-on 10.75% senior secured notes due 2018, referred to as the Add-On Notes, and the Company became party to a registration rights agreement, pursuant to which the Company agreed to register with the Securities and Exchange Commission the exchange of Add-On Notes for registered notes with the same terms as the existing 10.75% Senior Notes due 2018. The Company will pay interest on the Add-On Notes semi-annually on February 1st and August 1st of each year beginning on August 1, 2014.

The Company amended its existing corporate revolving credit agreement to increase the maximum available borrowing amount to $60 million, The revolver may support up to $60 million of letters of credit, which would reduce the balance available under the revolver.

The Company capitalized debt issuance costs of $15.4 million during the six months ended June 30, 2014 related to the new senior notes and the amendment of its revolver.

17

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONT.)

During the six months ended June 30, 2014, the Company paid $1.0 million, excluding accrued interest, to repurchase Senior Notes with a principal amount of $1.0 million. The Company recognized losses of $0.1 million on these repurchases, which were recorded as losses on extinguishment of debt. The losses on the repurchases were measured based on the carrying value of the repurchased portion of the Senior Notes, which included a portion of the unamortized debt issue costs and the debt discount on the dates of repurchase.

Under the indenture governing the 10.75% Senior Notes, the Company is required to offer a portion of our Excess Cash Flow (as defined by the indenture) for each fiscal year to purchase some of these notes at 100% of the principal amount. The Company had $29.5 million of Excess Cash Flow for the year ended December 31, 2013 and offered $22.1 million for repurchase during the second quarter of 2014. As of December 31, 2013, the Company had classified $22.1 million of the outstanding 10.75% Senior Notes to Current installments of long-term debt related to the required Excess Cash Flow offering. The Excess Cash Flow offer expired by June 30, 2014 with $1.0 million of principal being repaid. The remaining $21.1 million was reclassified to Long-term debt, less current installments as of June 30, 2014.

During the six months ended June 30, 2014, the Company entered into $12.9 million of new capital leases at its Kemmerer Mine.

Additional information regarding the Company’s debt is outlined in Note 5 to the Consolidated Financial Statements in the Company's 2013 Annual Report on Form 10-K.

7.    POSTRETIREMENT MEDICAL BENEFITS AND PENSION

Postretirement Medical Benefits

The Company provides postretirement medical benefits to retired employees and their dependents as mandated by the Coal Industry Retiree Health Benefit Act of 1992 and pursuant to collective bargaining agreements. The Company also provides these benefits to qualified full-time employees pursuant to collective bargaining agreements.

The components of net periodic postretirement medical benefit cost are as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2013		2014		2013
	(In thousands)				(In thousands)
Components of net periodic benefit cost:
Service cost	$	822	$	1,109	$	1,645	$	2,218
Interest cost	3,203		3,035		6,407		6,069
Amortization of deferred items	4		1,001		9		2,003
Total net periodic benefit cost	$	4,029	$	5,145	$	8,061	$	10,290

The following table shows the net periodic postretirement medical benefit costs that relate to current and former mining operations:

	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2013		2014		2013
	(In thousands)				(In thousands)
Former mining operations	$	2,402	$	3,119	$	4,807	$	6,237
Current operations	1,627		2,026		3,254		4,053
Total net periodic benefit cost	$	4,029	$	5,145	$	8,061	$	10,290

The costs for the former mining operations are included in Heritage health benefit expenses and costs for current operations are included in Cost of sales and Selling and administrative expenses.

Pension

The Company provides pension benefits to qualified full-time employees pursuant to collective bargaining agreements.

18

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONT.)

The Company incurred net periodic benefit costs of providing these pension benefits as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
	(In thousands)						(In thousands)
Components of net periodic benefit cost:
Service cost	$	500		$	638		$	1,000		$	1,173
Interest cost	1,638			1,555			3,384			3,180
Expected return on plan assets	(2,154		)	(2,325		)	(4,307		)	(4,385		)
Amortization of deferred items	359			1,004			719			1,745
Total net periodic pension cost	$	343		$	872		$	796		$	1,713

These costs are included in Cost of sales and Selling and administrative expenses.

The Company contributed $1.1 million of cash contributions to its pension plans in the six months ended June 30, 2014 and expects to make $3.2 million of pension plan contributions during the remainder of 2014.

8.    HERITAGE HEALTH BENEFIT EXPENSES

The caption Heritage health benefit expenses used in the consolidated statements of operations refers to costs of benefits the Company provides to its former mining operation employees. The components of these expenses are as follows:

	Three Months Ended June 30,					Six Months Ended June 30,
	2014		2013			2014		2013
	(In thousands)					(In thousands)
Health care benefits	$	2,376	$	3,089		$	4,650	$	6,266
Combined benefit fund payments	512		576			1,025		1,152
Workers’ compensation benefits	124		117			260		232
Black lung benefits	376		(673		)	997		(590		)
Total	$	3,388	$	3,109		$	6,932	$	7,060

9. ASSET RETIREMENT OBLIGATIONS, CONTRACTUAL THIRD-PARTY RECLAMATION RECEIVABLE AND RECLAMATION DEPOSITS

The asset retirement obligation, contractual third-party reclamation receivable, and reclamation deposits for each of the Company’s operating segments at June 30, 2014 are summarized below:

	Asset Retirement Obligation		Contractual Third-Party Reclamation Receivable		Reclamation Deposits
	(In thousands)
Coal - U.S.	$	281,346	$	95,157	$	75,911
Coal - Canada	107,111		6,739		—
Power	927		—		—
Total	$	389,384	$	101,896	$	75,911

19

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONT.)

Asset Retirement Obligations

Changes in the Company’s asset retirement obligations were as follows:

	Six Months Ended June 30,
	2014			2013
	(In thousands)
Asset retirement obligations, beginning of year (including current portion)	$	279,864		$	263,847
Accretion	14,003			10,951
Liabilities settled	(10,250		)	(11,647		)
ARO acquired	102,075			—
Changes due to foreign currency translation	3,692			—
Asset retirement obligations, end of period	389,384			263,151
Less current portion	(31,131		)	(24,105		)
Asset retirement obligations, less current portion	$	358,253		$	239,046

Contractual Third-Party Reclamation Receivables

At June 30, 2014, the Company has recognized as an asset of $101.9 million as contractual third-party reclamation receivables, representing the present value of customer obligations to reimburse the Company for future reclamation expenditures at the Company’s Rosebud, Jewett and Absaloka Mines.

Reclamation Deposits

The Company’s reclamation deposits will be used to fund final reclamation activities. The Company’s carrying value and estimated fair value of its reclamation deposits at June 30, 2014 are as follows:

	Carrying Value		Fair Value		Fair Value Hierarchy
	(In thousands)
Cash and cash equivalents	$	44,089	$	44,089	Level 1
Held-to-maturity securities	31,822		32,601		Level 2
	$	75,911	$	76,690

Held-to-Maturity Reclamation Deposits

The amortized cost, gross unrealized holding gains and losses and fair value of held-to-maturity securities at June 30, 2014 are as follows (in thousands):

Amortized cost	$	31,822
Gross unrealized holding gains	953
Gross unrealized holding losses	(174		)
Fair value	$	32,601

Maturities of held-to-maturity securities are as follows at June 30, 2014:

	Amortized Cost		Fair Value
	(In thousands)
Within one year	$	1,025	$	998
Due in five years or less	17,341		17,829
Due after five years to ten years	7,289		7,424
Due in more than ten years	6,167		6,350
	$	31,822	$	32,601

The Company does not intend to sell its held-to-maturity securities and it is not more likely than not that the Company will be required to sell the securities before recovery of amortized cost bases, which may be at maturity.

20

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONT.)

10.    DERIVATIVE INSTRUMENTS

Derivative Assets and Liabilities

The Company evaluates all of its financial instruments to determine if such instruments are derivatives, derivatives that qualify for the normal purchase normal sale exception, or contain features that qualify as embedded derivatives. All derivative financial instruments, except for derivatives that qualify for the normal purchase normal sale exception, are recognized on the balance sheet at fair value. Changes in fair value are recognized in earnings if they are not eligible for hedge accounting or in other comprehensive income if they qualify for cash flow hedge accounting.

In the first quarter of 2014, the Company entered into two foreign currency exchange forward contracts to purchase Canadian Dollars to manage a portion of its exposure to fluctuating rates of exchange on anticipated Canadian Dollar-denominated Canadian Acquisition cash flows. These two foreign currency contracts had a total notional amount of $348.3 million and were settled in April 2014.

During 2014, the Company entered into contracts to purchase power at its ROVA facility to manage exposure to power price fluctuations. These contracts cover the period from April 2014 to December 2018 and contracted power prices range from $41.05 to $44.09 megawatts per hour. The fair value of these power price derivatives are based on comparing contracted prices to projected future prices.

The fair value of outstanding derivative instruments not designated as hedging instruments on the accompanying Consolidated Balance Sheet was as follows (in thousands):

Derivative Instruments	Balance Sheet Location	June 30, 2014
Contracts to purchase power	Other current liabilities	$	140
Contracts to purchase power	Other liabilities	5,790

The effect of derivative instruments not designated as hedging instruments on the accompanying Consolidated Statements of Operations was as follows (in thousands):

Derivative Instruments	Statement of Operations Location	Three Months Ended June 30, 2014			Six Months Ended June 30, 2014
Canadian dollar foreign exchange forward contracts	Gain (loss) on foreign exchange	$	581		$	(6,209	)
Contracts to purchase power	Derivative loss	(5,930		)	(5,930		)

11.    FAIR VALUE MEASUREMENTS

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. See Notes 4, 9 and 10 for additional disclosures related to fair value measurements.

Fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy, as defined below, gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities and the lowest priority to unobservable inputs.

• Level 1, defined as observable inputs such as quoted prices in active markets for identical assets.

• Level 2, defined as observable inputs other than Level 1 prices. These include quoted prices for similar assets or liabilities in an active market, quoted prices for identical assets and liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

• Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.

Long-term debt fair value estimates are based on observed prices for securities with an active trading market when available (Level 2) and otherwise using discount rate estimates based on interest rates as of June 30, 2014 (Level 3). The estimated fair values of the Company’s debt with fixed interest rates are as follows:

21

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONT.)

	Carrying Value		Fair Value
	(In thousands)
December 31, 2013	$	328,473	$	364,329
June 30, 2014	$	694,515	$	726,146

The Company uses derivative financial instruments, primarily foreign exchange contracts and forward contracts to purchase power, to reduce its exposure to market risks from changes in foreign exchange rates and changes in prices for power, respectively. The foreign exchange contracts are measured at fair value using quoted forward foreign exchange prices from counterparties corroborated by market-based pricing (Level 2). The contracts to purchase power are measured at fair value using forward pricing curves for power from counterparties corroborated by market-based pricing (Level 2). Additional information related to the Company’s derivative financial instruments is disclosed in Notes 1 and 10 to the consolidated financial statements.

The Company’s non-recurring fair value measurements include asset retirement obligations (refer to Note 9).

The Company determines the estimated fair value of its asset retirement obligations by calculating the present value of estimated cash flows related to reclamation liabilities using Level 3 inputs. The significant inputs used to calculate such liabilities includes estimates of costs to be incurred, the Company’s credit adjusted discount rate, inflation rates and estimated dates of reclamation. The asset retirement liability is accreted to its present value each period and the capitalized asset retirement cost is depleted using the units-of-production method.

The fair value of assets and liabilities acquired through business combinations is calculated using a discounted-cash flow approach using Level 3 inputs. Cash flow estimates require forecasts and assumptions for many years into the future for a variety of factors.

12.    SHAREHOLDERS’ EQUITY AND ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

Preferred Stock

The Company has outstanding Series A Convertible Exchangeable Preferred Stock on which cumulative dividends of $2.125 per share are payable quarterly. The Company paid $0.5 million of preferred stock dividends for the six months ended June 30, 2014. During the three months ended June 30, 2014, approximately 25,454 shares of preferred stock were converted into 173,885 shares of common stock. Subsequent to June 30, 2014 and through July 29, 2014, approximately 3,825 shares of preferred stock were converted into 26,133 shares of common stock.

Changes in Accumulated Other Comprehensive Income (Loss)

The following table reflects the changes in accumulated other comprehensive income (loss) by component:

	Pension			Postretirement medical benefits			Foreign currency translation adjustment		Tax effect of other comprehensive income gains			Accumulated other comprehensive loss
	(In thousands)
Balance at December 31, 2013	$	(12,255	)	$	(20,292	)	$	—	$	(31,048	)	$	(63,595	)
Other comprehensive income (loss) before reclassifications	—			—			9,477		(224		)	9,253
Amounts reclassified from accumulated other comprehensive income (loss)	717			10			—		—			727
Balance at June 30, 2014	$	(11,538	)	$	(20,282	)	$	9,477	$	(31,272	)	$	(53,615	)

22

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONT.)

The following table reflects the reclassifications out of accumulated other comprehensive loss for the six months ended June 30, 2014 are as follows (in thousands):

Details about accumulated other comprehensive loss components	Amount reclassified from accumulated other comprehensive loss1						Affected line item in the statement where net income (loss) is presented
	Three Months Ended June 30, 2014			Six Months Ended June 30, 2014
Amortization of defined benefit pension items
Actuarial losses	$	359		$	717		2
Amortization of postretirement medical items
Prior service costs	$	(159	)	$	(318	)	3
Actuarial losses	164			328			3
Total	$	5		$	10

____________________

(1) Amounts in parentheses indicate debits to income/loss.

(2) These accumulated other comprehensive loss components are included in the computation of net periodic pension cost. (See Note 7 - Pension for additional details)

(3) These accumulated other comprehensive loss components are included in the computation of net periodic postretirement medical cost. (See Note 7 - Postretirement Medical Benefits for additional details)

Equity Offering

Subsequent to June 30, 2014, the Company completed a public offering of 1,684,507 shares of common stock at $35.50 per share for gross proceeds of $59.8 million. The Company intends to use the net proceeds of the offering to increase its overall financial flexibility, pursue organic and acquisition growth strategies and for general corporate purposes.

13.     SHARE-BASED COMPENSATION

The Company grants employees and non-employee directors restricted stock units from the Amended and Restated 2007 Equity Incentive Stock Plan. The Amended and Restated 2007 Equity Incentive Stock Plan provides that non-employee directors will receive equity awards with a value of $90,000 after each annual meeting.

In June 2014, the Company began contributing Company stock to its 401(k) plan instead of cash.

The Company recognized compensation expense from share-based arrangements shown in the following table:

	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2013		2014		2013
	(In thousands)
Recognition of fair value of restricted stock units, stock options and SARs over vesting period; and issuance of stock	$	1,388	$	597	$	2,116	$	2,260
Contributions of stock to the Company's 401(k) plan	329		788		329		1,511
Total share-based compensation expense	$	1,717	$	1,385	$	2,445	$	3,771

23

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONT.)

Restricted Stock Units

A summary of restricted stock award activity for the six months ended June 30, 2014 is as follows:

	Units		Weighted Average Grant-Date Fair Value		Unamortized Compensation Expense (In thousands)
Non-vested at December 31, 2013	588,727		$	9.37
Granted	214,188		—
Vested	(299,872	)	—
Non-vested at June 30, 2014	503,043		$	8.64	$	5,605	(1)

____________________

(1) Expected to be recognized over the next three years.

Stock Options

A summary of stock option activity for the six months ended June 30, 2014 is as follows:

	Stock Options		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (In years)	Aggregate Intrinsic Value (In thousands)		Unamortized Compensation Expense (In thousands)
Outstanding at December 31, 2013	145,806		$	21.97
Exercised	(9,000	)	$	21.40
Expired	—		$	—
Outstanding and exercisable at June 30, 2014	136,806		$	22.01	3.7	$	1,953	$	—

There were no stock options granted during the six months ended June 30, 2014.

SARs

A summary of SARs activity for the six months ended June 30, 2014 is as follows:

	SARs		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (In years)	Aggregate Intrinsic Value (In thousands)		Unamortized Compensation Expense (In thousands)
Outstanding at December 31, 2013	70,734		$	22.60
Exercised	(36,291	)	$	21.30
Expired	—		$	—
Outstanding and exercisable at June 30, 2014	34,443		$	23.97	1.7	$	424	$	—

There were no SARs granted during the six months ended June 30, 2014.

14.    EARNINGS PER SHARE

Basic earnings (loss) per share has been computed by dividing the net income (loss) applicable to common shareholders by the weighted average number of shares of common stock outstanding during each period. Net income (loss) applicable to common shareholders includes the adjustment for net income or loss attributable to noncontrolling interest. Diluted earnings (loss) per share is computed by including the dilutive effect of common stock that would be issued assuming conversion or exercise of outstanding convertible notes and securities, stock options, stock appreciation rights, and restricted stock units. No such items were included in the computations of diluted loss per share in the six months ended June 30, 2014

24

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONT.)

and June 30, 2013 because the Company incurred a net loss applicable to common shareholders in these periods and the effect of inclusion would have been anti-dilutive.

The table below shows the number of shares that were excluded from the calculation of diluted loss per share because their inclusion would be anti-dilutive to the calculation:

	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2013		2014		2013
	(In thousands)
Convertible securities	$	654	$	1,093	$	654	$	1,093
Restricted stock units, stock options and SARs	674		862		674		862
Total shares excluded from diluted shares calculation	$	1,328	$	1,955	$	1,328	$	1,955

15.    BUSINESS SEGMENT INFORMATION

Segment information is based on a management approach, which requires segmentation based upon the Company’s internal organization, reporting of revenue, and operating income.

The Company’s operations are classified into five reporting segments: Coal - U.S., Coal - Canada, Power, Heritage and Corporate. The Canadian Acquisition was completed on April 28, 2014 and the segment "Coal - Canada" has not been previously presented. The business segment information for the Company's U.S. coal operations was previously reported in the "Coal" segment in the 2013 Form 10-K since the Company previously only held coal operations in the U.S.

25

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONT.)

Summarized financial information by segment is as follows:

	Coal - U.S.			Coal - Canada(1)			Power			Heritage			Corporate			Consolidated
	(In thousands)
Three Months Ended June 30, 2014
Revenues	$	150,107		$	116,046		$	21,803		$	—		$	—		$	287,956
Restructuring charges	491			6,646			101			—			305			7,543
Depreciation, depletion, and amortization	13,283			8,671			2,486			—			39			24,479
Operating income (loss)	(423		)	(12,709		)	(9,473		)	(3,559		)	(3,476		)	(29,640		)
Total assets	670,375			687,185			165,763			15,664			44,734			1,583,721
Capital expenditures	6,533			7,495			220			—			63			14,311
Three Months Ended June 30, 2013
Revenues	$	139,337		$	—		$	23,162		$	—		$	—		$	162,499
Depreciation, depletion, and amortization	12,804			—			2,551			—			42			15,397
Operating income (loss)	12,572			—			4,837			(3,530		)	(1,904		)	11,975
Total assets	699,556			—			183,855			16,305			33,887			933,603
Capital expenditures	7,209			—			564			—			393			8,166
Six Months Ended June 30, 2014
Revenues	$	308,298		$	116,046		$	43,815		$	—		$	—		$	468,159
Restructuring charges	491			6,646			499			—			305			7,941
Depreciation, depletion, and amortization	26,780			8,671			5,009			—			78			40,538
Operating income (loss)	12,275			(12,709		)	(7,731		)	(7,389		)	(6,034		)	(21,588		)
Total assets	670,375			687,185			165,763			15,664			44,734			1,583,721
Capital expenditures	9,586			7,495			255			—			25			17,361
Six Months Ended June 30, 2013
Revenues	$	281,449		$	—		$	42,498		$	—		$	—		$	323,947
Depreciation, depletion, and amortization	24,658			—			5,081			—			84			29,823
Operating income (loss)	25,566			—			3,836			(7,705		)	(3,987		)	17,710
Total assets	699,556			—			183,855			16,305			33,887			933,603
Capital expenditures	12,219			—			698			—			550			13,467

____________________

(1) The Canadian operations were acquired on April 28, 2014, therefore, information for the three and six months ended June 30, 2014 includes approximately two months of operations and there is no activity for 2013.

Certain amounts in prior periods have been reclassified to conform with the presentation of 2014. The reclassification affected depreciation, depletion and amortization and operating income (loss) between the Coal U.S. segment and the Corporate segment.

26

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONT.)

A reconciliation of segment income (loss) from operations to loss before income taxes follows:

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
	(In thousands)
Income (loss) from operations	$	(29,640	)	$	11,975		$	(21,588	)	$	17,710
Loss on extinguishment of debt	(12,635		)	(64		)	(12,635		)	(64		)
Interest expense	(21,786		)	(10,076		)	(42,584		)	(20,236		)
Interest income	1,582			280			1,884			577
Gain (loss) on foreign exchange	2,649			—			(4,141		)	—
Other income	483			130			576			198
Income (loss) before income taxes	$	(59,347	)	$	2,245		$	(78,488	)	$	(1,815	)

16.    CONTINGENCIES

The Company is a party to routine claims and lawsuits with respect to various matters. The Company provides for costs related to contingencies when a loss is probable and the amount is reasonably estimable. After conferring with counsel, it is the opinion of management that the ultimate resolution of pending claims will not have a material adverse effect on the consolidated financial condition, results of operations, or liquidity of the Company.

17.    SUPPLEMENTAL CONSOLIDATING FINANCIAL INFORMATION

Pursuant to the indenture governing the 10.75% Senior Notes, certain 100% owned subsidiaries of the Company have fully and unconditionally guaranteed the notes on a joint and several basis.

As a result of the prepayment of the WML Notes, WML became a Guarantor Subsidiary. The following tables include WML as a Guarantor Subsidiary, including the 2013 information which has been recast.

Guarantees of the Senior Notes will be released under certain circumstances, including:

(1) in the event of a sale or other disposition of all or substantially all of the assets of such Guarantor Subsidiary, by way of merger, consolidation or otherwise, a sale or other disposition of all of the Equity Interests of such Guarantor Subsidiary then held by the Issuers or any Restricted Subsidiary; provided, that the sale or other disposition does not violate the “Asset Sales” provisions of the Indenture;

(2) if such Guarantor Subsidiary is designated as an Unrestricted Subsidiary in accordance with the provisions of the Indenture, upon effectiveness of such designation;

(3) upon Legal Defeasance or Covenant Defeasance (as such terms are defined in the indenture) or upon satisfaction and discharge of the Indenture;

(4) upon the liquidation or dissolution of such Guarantor Subsidiary, provided no event of default has occurred and is continuing; or

(5) at such time as such Guarantor Subsidiary is no longer required to be a Guarantor Subsidiary of the Senior Notes as described in the Indenture, provided no event of default has occurred and is continuing.

The following tables present unaudited consolidating financial information for (i) the issuer of the notes (Westmoreland Coal Company), (ii) the co-issuer of the notes (Westmoreland Partners), (iii) the guarantors under the notes, and (iv) the entities that are not guarantors under the notes:

27

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONT.)

CONSOLIDATING BALANCE SHEETS

June 30, 2014

(In thousands)

Assets	Parent/ Issuer		Co-Issuer		Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Consolidating Adjustments			Total
Current assets:
Cash and cash equivalents	$	13,514	$	415	$	24,440		$	2,241		$	—		$	40,610
Receivables:
Trade	—		12,940		116,712			—			—			129,652
Loan and lease receivable	—		—		11,682			—			—			11,682
Contractual third-party reclamation receivables	—		—		7,940			—			—			7,940
Intercompany receivable/payable	132,824		32,639		(146,187		)	(19,275		)	(1		)	—
Other	673		210		2,294			45			(40		)	3,182
	133,497		45,789		(7,559		)	(19,230		)	(41		)	152,456
Inventories	—		5,319		147,834			1			—			153,154
Deferred income taxes	5,370		—		683			—			—			6,053
Other current assets	972		335		11,055			—			—			12,362
Total current assets	153,353		51,858		176,453			(16,988		)	(41		)	364,635
Property, plant and equipment:
Land and mineral rights	—		1,395		437,606			—			—			439,001
Plant and equipment	4,022		221,350		606,965			—			—			832,337
	4,022		222,745		1,044,571			—			—			1,271,338
Less accumulated depreciation, depletion and amortization	2,863		76,662		406,295			—			—			485,820
Net property, plant and equipment	1,159		146,083		638,276			—			—			785,518
Loan and lease receivable	—		—		85,344			—			—			85,344
Advanced coal royalties	—		—		7,134			—			—			7,134
Reclamation deposits	—		—		75,911			—			—			75,911
Restricted investments and bond collateral	63,322		—		41,189			—			—			104,511
Contractual third-party reclamation receivables	—		—		93,956			—			—			93,956
Investment in joint venture	—		—		33,273			—			—			33,273
Intangible assets	—		460		217			—			—			677
Investment in subsidiaries	480,871		—		—			3,770			(484,641		)	—
Other assets	21,825		—		10,937			3,500			(3,500		)	32,762
Total assets	$	720,530	$	198,401	$	1,162,690		$	(9,718	)	$	(488,182	)	$	1,583,721

28

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONT.)

CONSOLIDATING BALANCE SHEETS

June 30, 2014

(In thousands)

Liabilities and Shareholders’ Deficit	Parent/ Issuer			Co-Issuer			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Consolidating Adjustments			Total
Current liabilities
Current installments of long-term debt	$	—		$	—		$	42,401		$	—		$	—		$	42,401
Accounts payable and accrued expenses:
Trade and other accrued liabilities	5,240			7,996			114,423			684			(5		)	128,338
Interest payable	30,315			—			474			—			(39		)	30,750
Production taxes	—			1,081			38,936			2,657			(1		)	42,673
Workers’ compensation	707			—			—			—			—			707
Postretirement medical benefits	12,042			—			773			1,139			1			13,955
SERP	390			—			—			—			—			390
Deferred revenue	—			9,581			1,980			—			—			11,561
Asset retirement obligations	—			—			31,131			—			—			31,131
Other current liabilities	593			5,279			6,102			—			(1		)	11,973
Total current liabilities	49,287			23,937			236,220			4,480			(45		)	313,879
Long-term debt, less current installments	698,015			—			96,128			—			(3,500		)	790,643
Workers’ compensation, less current portion	6,629			—			—			—			—			6,629
Excess of black lung benefit obligation over trust assets	9,841			—			—			—			—			9,841
Postretirement medical benefits, less current portion	184,902			—			68,766			18,105			—			271,773
Pension and SERP obligations, less current portion	12,776			97			9,110			239			—			22,222
Deferred revenue, less current portion	—			35,949			4,728			—			(1		)	40,676
Asset retirement obligations, less current portion	—			927			357,326			—			—			358,253
Intangible liabilities	—			5,072			—			—			—			5,072
Deferred income taxes	5,370			—			10,144			—			—			15,514
Other liabilities	707			5,790			3,167			200			—			9,864
Intercompany receivable/payable	13,648			—			(13,849		)	14,654			(14,453		)	—
Total liabilities	981,175			71,772			771,740			37,678			(17,999		)	1,844,366
Shareholders’ deficit
Preferred stock	96			—			—			—			—			96
Common stock	38,173			5			110			132			(247		)	38,173
Other paid-in capital	133,140			52,848			441,269			(124		)	(493,993		)	133,140
Accumulated other comprehensive loss	(53,615		)	(160		)	16,075			(3,067		)	(12,848		)	(53,615		)
Accumulated earnings (deficit)	(378,439		)	73,936			(66,504		)	(44,337		)	36,905			(378,439		)
Total equity (deficit)	(260,645		)	126,629			390,950			(47,396		)	(470,183		)	(260,645		)
Total liabilities and shareholders’ deficit	$	720,530		$	198,401		$	1,162,690		$	(9,718	)	$	(488,182	)	$	1,583,721

29

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONT.)

CONSOLIDATING BALANCE SHEETS

December 31, 2013

(In thousands)

Assets	Parent/ Issuer			Co-Issuer		Guarantor Subsidiaries		Non- Guarantor Subsidiaries			Consolidating Adjustments			Total
Current assets:
Cash and cash equivalents	$	25,326		$	3,341	$	27,451	$	4,992		$	—		$	61,110
Receivables:
Trade	—			12,934		46,985		6,277			—			66,196
Contractual third-party reclamation receivables	—			—		8,487		—			—			8,487
Intercompany receivable/payable	(16,273		)	—		2,761		(19,353		)	32,865			—
Other	1,616			210		3,256		28			(24		)	5,086
	(14,657		)	13,144		61,489		(13,048		)	32,841			79,769
Inventories	—			6,161		33,811		—			—			39,972
Deferred income taxes	5,355			—		870		—			(870		)	5,355
Restricted investments and bond collateral	—			5,998		—		—			—			5,998
Other current assets	789			143		11,069		834			—			12,835
Total current assets	16,813			28,787		134,690		(7,222		)	31,971			205,039
Property, plant and equipment:
Land and mineral rights	—			1,395		276,793		—			—			278,188
Plant and equipment	3,973			220,872		432,851		—			—			657,696
	3,973			222,267		709,644		—			—			935,884
Less accumulated depreciation, depletion and amortization	2,707			71,653		371,488		—			—			445,848
Net property, plant and equipment	1,266			150,614		338,156		—			—			490,036
Advanced coal royalties	—			—		7,311		—			—			7,311
Reclamation deposits	—			—		74,921		—			—			74,921
Restricted investments and bond collateral	15,134			—		54,101		—			—			69,235
Contractual third-party reclamation receivables	—			—		88,303		—			—			88,303
Intangible assets	—			1,283		237		—			—			1,520
Investment in subsidiaries	280,843			—		—		3,770			(284,613		)	—
Other assets	8,636			—		1,683		2,000			(1,999		)	10,320
Total assets	$	322,692		$	180,684	$	699,402	$	(1,452	)	$	(254,641	)	$	946,685

30

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONT.)

CONSOLIDATING BALANCE SHEETS

December 31, 2013

(In thousands)

Liabilities and Shareholders’ Deficit	Parent/ Issuer			Co-Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Current liabilities
Current installments of long-term debt	$	20,392		$	—		$	23,951		$	—		$	—		$	44,343
Accounts payable and accrued expenses:
Trade	6,840			10,119			38,061			2,487			—			57,507
Interest payable	11,302			—			40			—			(21		)	11,321
Production taxes	—			3			36,522			5,380			—			41,905
Workers’ compensation	717			—			—			—			—			717
Postretirement medical benefits	12,042			—			774			1,139			—			13,955
SERP	390			—			—			—			—			390
Deferred revenue	—			9,024			5,044			—			—			14,068
Asset retirement obligations	—			—			23,353			—			—			23,353
Other current liabilities	—			5,053			417			—			(1		)	5,469
Total current liabilities	51,683			24,199			128,162			9,006			(22		)	213,028
Long-term debt, less current installments	224,582			—			72,912			—			(2,000		)	295,494
Workers’ compensation, less current portion	6,744			—			—			—			—			6,744
Excess of black lung benefit obligation over trust assets	8,675			—			—			—			—			8,675
Postretirement medical benefits, less current portion	185,858			—			66,439			18,077			—			270,374
Pension and SERP obligations, less current portion	13,069			99			10,765			243			—			24,176
Deferred revenue, less current portion	—			41,297			5,270			—			—			46,567
Asset retirement obligations, less current portion	—			892			255,619			—			—			256,511
Intangible liabilities	—			5,606			—			—			—			5,606
Deferred income taxes	5,355			—			—			—			—			5,355
Other liabilities	584			—			6,687			983			(6,220		)	2,034
Intercompany receivable/payable	14,021			—			(7,851		)	14,654			(20,824		)	—
Total liabilities	510,571			72,093			538,003			42,963			(29,066		)	1,134,564
Shareholders’ deficit
Preferred stock	160			—			—			—			—			160
Common stock	36,479			5			110			132			(247		)	36,479
Other paid-in capital	134,861			52,835			157,984			(124		)	(210,695		)	134,861
Accumulated other comprehensive loss	(63,595		)	(164		)	6,425			(3,086		)	(3,175		)	(63,595		)
Accumulated earnings (deficit)	(295,784		)	55,915			(3,120		)	(41,337		)	(11,458		)	(295,784		)
Total equity (deficit)	(187,879		)	108,591			161,399			(44,415		)	(225,575		)	(187,879		)
Total liabilities and shareholders’ deficit	$	322,692		$	180,684		$	699,402		$	(1,452	)	$	(254,641	)	$	946,685

31

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONT.)

CONSOLIDATING STATEMENTS OF OPERATIONS

Three Months Ended June 30, 2014

(In thousands)

	Parent/ Issuer			Co-Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments		Total
Revenues	$	—		$	21,803		$	266,153		$	—		$	—	$	287,956
Costs and expenses:
Cost of sales	(247		)	21,592			227,044			—			—		248,389
Depreciation, depletion and amortization	79			2,485			21,915			—			—		24,479
Selling and administrative	12,003			1,169			15,921			(384		)	—		28,709
Heritage health benefit expenses	3,178			—			—			210			—		3,388
Gain on sales of assets	—			—			(43		)	—			—		(43		)
Restructuring charges	796			101			6,646			—			—		7,543
Derivative loss	—			5,930			—			—			—		5,930
Income from equity affiliates	—			—			(799		)	—			—		(799		)
	15,809			31,277			270,684			(174		)	—		317,596
Operating income (loss)	(15,809		)	(9,474		)	(4,531		)	174			—		(29,640		)
Other income (expense):
Interest expense	(18,609		)	(74		)	(3,111		)	(1		)	9		(21,786		)
Loss on extinguishment of debt	(63		)	—			(12,571		)	(1		)	—		(12,635		)
Interest income	145			4			1,433			—			—		1,582
Gain on foreign exchange	1,557			—			1,092			—			—		2,649
Other income	—			—			483			—			—		483
	(16,970		)	(70		)	(12,674		)	(2		)	9		(29,707		)
Income (loss) before income taxes and income of consolidated subsidiaries	(32,779		)	(9,544		)	(17,205		)	172			9		(59,347		)
Equity in income of subsidiaries	(30,462		)	—			—			—			30,462		—
Income (loss) before income taxes	(63,241		)	(9,544		)	(17,205		)	172			30,471		(59,347		)
Income tax expense (benefit)	(87		)	—			(74		)	1			3,967		3,807
Net income (loss)	(63,154		)	(9,544		)	(17,131		)	171			26,504		(63,154		)
Less net loss attributable to noncontrolling interest	—			—			—			—			—		—
Net income (loss) attributable to the Parent company	$	(63,154	)	$	(9,544	)	$	(17,131	)	$	171		$	26,504	$	(63,154	)

32

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONT.)

CONSOLIDATING STATEMENTS OF OPERATIONS

Three Months Ended June 30, 2013

(In thousands)

	Parent/ Issuer			Co-Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Revenues	$	—		$	23,162		$	134,449		$	9,538		$	(4,650	)	$	162,499
Costs and expenses:
Cost of sales	(372		)	14,901			113,640			7,009			(4,650		)	130,528
Depreciation, depletion and amortization	94			2,551			12,753			—			(1		)	15,397
Selling and administrative	4,259			872			7,232			(394		)	—			11,969
Heritage health benefit expenses	2,844			—			—			265			—			3,109
Gain on sales of assets	—			—			(74		)	—			—			(74		)
Other operating income	—			—			(10,405		)	—			—			(10,405		)
	6,825			18,324			123,146			6,880			(4,651		)	150,524
Operating income (loss)	(6,825		)	4,838			11,303			2,658			1			11,975
Other income (expense):
Interest expense	(7,591		)	(10		)	(2,479		)	(5		)	9			(10,076		)
Loss on extinguishment of debt	(64		)	—			—			—			—			(64		)
Interest income	46			5			232			6			(9		)	280
Other income (loss)	2			—			130			(2		)	—			130
	(7,607		)	(5		)	(2,117		)	(1		)	—			(9,730		)
Income (loss) before income taxes and income of consolidated subsidiaries	(14,432		)	4,833			9,186			2,657			1			2,245
Equity in income of subsidiaries	16,648			—			—			—			(16,648		)	—
Income (loss) before income taxes	2,216			4,833			9,186			2,657			(16,647		)	2,245
Income tax expense (benefit)	(1		)	—			1,139			—			(1,110		)	28
Net income (loss)	2,217			4,833			8,047			2,657			(15,537		)	2,217
Less net loss attributable to noncontrolling interest	2,499			—			—			—			—			2,499
Net income (loss) attributable to the Parent company	$	(282	)	$	4,833		$	8,047		$	2,657		$	(15,537	)	$	(282	)

33

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONT.)

CONSOLIDATING STATEMENTS OF OPERATIONS

Six Months Ended June 30, 2014

(In thousands)

	Parent/ Issuer			Co-Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Revenues	$	—		$	43,815		$	424,351		$	(7	)	$	—		$	468,159
Costs and expenses:
Cost of sales	(471		)	38,046			349,389			55			—			387,019
Depreciation, depletion and amortization	156			5,009			35,373			—			—			40,538
Selling and administrative	16,968			2,062			23,783			(773		)	—			42,040
Heritage health benefit expenses	6,504			—			—			428			—			6,932
Gain on sales of assets	—			—			(5		)	—			—			(5		)
Restructuring charges	796			499			6,646			—			—			7,941
Derivative loss	—			5,930			—			—			—			5,930
Equity in net income of unconsolidated affiliates	—			—			(799		)	—			—			(799		)
Other operating income	—			—			150			1			—			151
	23,953			51,546			414,537			(289		)	—			489,747
Operating income (loss)	(23,953		)	(7,731		)	9,814			282			—			(21,588		)
Other income (expense):
Interest expense	(37,282		)	(118		)	(5,199		)	—			15			(42,584		)
Loss on extinguishment of debt	(62		)	—			(12,572		)	(1		)	—			(12,635		)
Interest income	269			7			1,608			15			(15		)	1,884
Gain (loss) on foreign exchange	(5,233		)	—			1,092			—			—			(4,141		)
Other income	—			—			576			—			—			576
	(42,308		)	(111		)	(14,495		)	14			—			(56,900		)
Income (loss) before income taxes and income of consolidated subsidiaries	(66,261		)	(7,842		)	(4,681		)	296			—			(78,488		)
Equity in income of subsidiaries	(16,148		)	—			—			—			16,148			—
Income (loss) before income taxes	(82,409		)	(7,842		)	(4,681		)	296			16,148			(78,488		)
Income tax expense (benefit)	(224		)	—			5,041			—			(1,120		)	3,697
Net income (loss)	(82,185		)	(7,842		)	(9,722		)	296			17,268			(82,185		)
Less net loss attributable to noncontrolling interest	—			—			—			—			—			—
Net income (loss) attributable to the Parent company	$	(82,185	)	$	(7,842	)	$	(9,722	)	$	296		$	17,268		$	(82,185	)

34

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONT.)

CONSOLIDATING STATEMENTS OF OPERATIONS

Six Months Ended June 30, 2013

(In thousands)

	Parent/ Issuer			Co-Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Revenues	$	—		$	42,498		$	274,187		$	20,889		$	(13,627	)	$	323,947
Costs and expenses:
Cost of sales	(770		)	31,856			223,417			20,073			(13,627		)	260,949
Depreciation, depletion and amortization	187			5,082			24,554			—			—			29,823
Selling and administrative	8,207			1,726			14,680			(758		)	—			23,855
Heritage health benefit expenses	6,533			—			—			527			—			7,060
Gain on sales of assets	—			—			(308		)	—			—			(308		)
Other operating income	—			—			(15,142		)	—			—			(15,142		)
	14,157			38,664			247,201			19,842			(13,627		)	306,237
Operating income (loss)	(14,157		)	3,834			26,986			1,047			—			17,710
Other income (expense):
Interest expense	(15,175		)	(20		)	(5,048		)	(10		)	17			(20,236		)
Loss on extinguishment of debt	(64		)	—			—			—			—			(64		)
Interest income	76			15			493			10			(17		)	577
Other income (loss)	—			—			200			(2		)	—			198
	(15,163		)	(5		)	(4,355		)	(2		)	—			(19,525		)
Income (loss) before income taxes and income of consolidated subsidiaries	(29,320		)	3,829			22,631			1,045			—			(1,815		)
Equity in income of subsidiaries	27,450			—			—			—			(27,450		)	—
Income (loss) before income taxes	(1,870		)	3,829			22,631			1,045			(27,450		)	(1,815		)
Income tax expense (benefit)	—			—			4,458			—			(4,403		)	55
Net income (loss)	(1,870		)	3,829			18,173			1,045			(23,047		)	(1,870		)
Less net loss attributable to noncontrolling interest	797			—			—			—			—			797
Net income (loss) attributable to the Parent company	$	(2,667	)	$	3,829		$	18,173		$	1,045		$	(23,047	)	$	(2,667	)

35

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONT.)

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

Three Months Ended June 30, 2014

(In thousands)

	Parent/Issuer			Co-Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Consolidating Adjustments			Total
Net income (loss)	$	(63,154	)	$	(9,544	)	$	(17,131	)	$	171	$	26,504		$	(63,154	)
Other comprehensive income (loss)
Amortization of accumulated actuarial gains or losses, pension	359			2			122			6		(130		)	359
Amortization of accumulated actuarial gains or losses, transition obligations, and prior service costs, postretirement medical benefit	5			—			(36		)	5		31			5
Tax effect of other comprehensive income gains	64			—			—			—		—			64
Change in foreign currency translation adjustment	9,477			—			9,477			—		(9,477		)	9,477
Other comprehensive income (loss)	9,905			2			9,563			11		(9,576		)	9,905
Comprehensive income (loss) attributable to the Parent company	$	(53,249	)	$	(9,542	)	$	(7,568	)	$	182	$	16,928		$	(53,249	)

36

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONT.)

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

Three Months Ended June 30, 2013

(In thousands)

	Parent/Issuer			Co-Issuer		Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Consolidating Adjustments			Total
Net income (loss)	$	2,217		$	4,833	$	8,047		$	2,657	$	(15,537	)	$	2,217
Other comprehensive income (loss)
Amortization of accumulated actuarial gains or losses, pension	1,004			8		239			—		(247		)	1,004
Amortization of accumulated actuarial gains or losses, transition obligations, and prior service costs, postretirement medical benefit	1,001			—		214			—		(214		)	1,001
Unrealized and realized gains and losses on available-for-sale securities	(39		)	—		(40		)	—		40			(39		)
Other comprehensive income (loss)	1,966			8		413			—		(421		)	1,966
Comprehensive income (loss) attributable to the Parent company	$	4,183		$	4,841	$	8,460		$	2,657	$	(15,958	)	$	4,183

37

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONT.)

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

Six Months Ended June 30, 2014

(In thousands)

	Parent/Issuer			Co-Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Consolidating Adjustments			Total
Net income (loss)	$	(82,185	)	$	(7,842	)	$	(9,722	)	$	296	$	17,268		$	(82,185	)
Other comprehensive income (loss)
Amortization of accumulated actuarial gains or losses, pension	717			4			244			11		(259		)	717
Amortization of accumulated actuarial gains or losses, transition obligations, and prior service costs, postretirement medical benefit	10			—			(72		)	10		62			10
Tax effect of other comprehensive income gains	(224		)	—			—			—		—			(224		)
Change in foreign currency translation adjustment	9,477			—			9,477			—		(9,477		)	9,477
Other comprehensive income (loss)	9,980			4			9,649			21		(9,674		)	9,980
Comprehensive income (loss) attributable to the Parent company	$	(72,205	)	$	(7,838	)	$	(73	)	$	317	$	7,594		$	(72,205	)

38

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONT.)

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

Six Months Ended June 30, 2013

(In thousands)

	Parent/Issuer			Co-Issuer		Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Consolidating Adjustments			Total
Net income (loss)	$	(1,870	)	$	3,829	$	18,173		$	1,045	$	(23,047	)	$	(1,870	)
Other comprehensive income (loss)
Amortization of accumulated actuarial gains or losses, pension	1,745			14		432			—		(446		)	1,745
Amortization of accumulated actuarial gains or losses, transition obligations, and prior service costs, postretirement medical benefit	2,002			—		427			—		(427		)	2,002
Unrealized and realized gains and losses on available-for-sale securities	(39		)	—		(40		)	—		40			(39		)
Other comprehensive income (loss)	3,708			14		819			—		(833		)	3,708
Comprehensive income (loss) attributable to the Parent company	$	1,838		$	3,843	$	18,992		$	1,045	$	(23,880	)	$	1,838

39

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONT.)

CONSOLIDATING STATEMENTS OF CASH FLOWS

Six Months Ended June 30, 2014

(In thousands)

Statements of Cash Flows	Parent/ Issuer			Co-Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Cash flows from operating activities:
Net income (loss)	$	(82,185	)	$	(7,842	)	$	(9,722	)	$	296		$	17,268		$	(82,185	)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Equity in income of subsidiaries	16,148			—			—			—			(16,148		)	—
Depreciation, depletion, and amortization	156			5,009			35,373			—			—			40,538
Accretion of asset retirement obligation and receivable	—			34			9,254			—			—			9,288
Non-cash tax benefits	(224		)	—			—			—			—			(224		)
Amortization of intangible assets and liabilities, net	—			290			20			—			—			310
Share-based compensation	1,934			14			497			—			—			2,445
Gain on sales of assets	—			—			(5		)	—			—			(5		)
Amortization of deferred financing costs	494			—			715			—			—			1,209
Loss on extinguishment of debt	62			—			12,572			1			—			12,635
Loss on sales of investment securities	—			—			3			—			—			3
Loss on derivative	—			5,930			—			—			—			5,930
Loss on foreign exchange	5,233			—			(1,092		)	—			—			4,141
Income from equity affiliates	—			—			(799		)	—			—			(799		)
Distributions from equity affiliates	—			—			730			—			—			730
Changes in operating assets and liabilities:
Receivables, net	943			(6		)	(18,474		)	4,733			1,534			(11,270		)
Inventories	—			842			21,929			(1		)	—			22,770
Excess of black lung benefit obligation over trust assets	1,166			—			—			—			—			1,166
Deferred income tax	—			—			3,854			—			—			3,854
Accounts payable and accrued expenses	17,348			(1,101		)	(3,164		)	(4,526		)	(19		)	8,538
Deferred revenue	—			(4,791		)	(3,633		)	—			—			(8,424		)
Income tax payable	—			—			528			—			—			528
Accrual for workers’ compensation	(125		)	—			—			—			—			(125		)
Asset retirement obligations	—			—			(3,364		)	2			—			(3,362		)
Accrual for postretirement medical benefits	(885		)	—			2,256			38			—			1,409
Pension and SERP obligations	166			2			(507		)	7			—			(332		)
Other assets and liabilities	(7,429		)	(273		)	4,113			(1,193		)	6,587			1,805
Distributions received from subsidiaries	76,800			—			—			—			(76,800		)	—

40

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONT.)

Net cash provided by (used in) operating activities	29,602			(1,892		)	51,084			(643		)	(67,578		)	10,573
Cash flows from investing activities:
Additions to property, plant and equipment	16			(255		)	(17,122		)	—			—			(17,361		)
Change in restricted investments and bond collateral and reclamation deposits	(48,188		)	5,998			11,673			—			—			(30,517		)
Cash payments related to Canadian acquisition	(282,788		)	—			(39,849		)	—			—			(322,637		)
Cash acquired related to Canadian acquisition	—			—			8,103			—			—			8,103
Net proceeds from sales of assets	—			—			213			—			—			213
Proceeds from the sale of investments	—			—			246			—			—			246
Increase in loan and lease receivable	—			—			(1,120		)	—			—			(1,120		)
Receipts from loan and lease receivable	—			—			2,164			—			—			2,164
Receivable from customer for property and equipment purchases	—			—			—			—			—			—
Other	—			—			(82		)	—			—			(82		)
Net cash provided by (used in) investing activities	(330,960		)	5,743			(35,774		)	—			—			(360,991		)
Cash flows from financing activities:
Change in book overdrafts	—			—			1,605			—			—			1,605
Borrowings from long-term debt	454,219			—			—			—			—			454,219
Repayments of long-term debt	(1,015		)	—			(96,523		)	—			—			(97,538		)
Borrowings on revolving lines of credit	—			—			10,000			—			—			10,000
Repayments on revolving lines of credit	—			—			(10,000		)	—			—			(10,000		)
Debt issuance costs and other refinancing costs	(15,407		)	—			(11,646		)	—			—			(27,053		)
Dividends/distributions	(470		)	(8,500		)	(68,300		)	—			76,800			(470		)
Exercise of stock options	193			—			—			—			—			193
Transactions with Parent/affiliates	(147,974		)	1,723			157,581			(2,108		)	(9,222		)	—
Net cash provided by (used in) financing activities	289,546			(6,777		)	(17,283		)	(2,108		)	67,578			330,956
Effect of foreign exchange rates on cash	—			—			(1,038		)	—			—			(1,038		)
Net decrease in cash and cash equivalents	(11,812		)	(2,926		)	(3,011		)	(2,751		)	—			(20,500		)
Cash and cash equivalents, beginning of period	25,326			3,341			27,451			4,992			—			61,110
Cash and cash equivalents, end of period	$	13,514		$	415		$	24,440		$	2,241		$	—		$	40,610

41

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONT.)

CONSOLIDATING STATEMENTS OF CASH FLOWS

Six Months Ended June 30, 2013

(In thousands)

Statements of Cash Flows	Parent/ Issuer			Co-Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Cash flows from operating activities:
Net income (loss)	$	(1,870	)	$	3,829		$	18,173		$	1,045		$	(23,047	)	$	(1,870	)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Equity in income of subsidiaries	(27,450		)	—			—			—			27,450			—
Depreciation, depletion, and amortization	187			5,082			24,554			—			—			29,823
Accretion of asset retirement obligation and receivable	—			32			6,305			1			—			6,338
Amortization of intangible assets and liabilities, net	—			312			19			(5		)	—			326
Share-based compensation	1,567			23			2,181			—			—			3,771
Gain on sales of assets	—			—			(308		)	—			—			(308		)
Amortization of deferred financing costs	1,541			—			315			—			—			1,856
Loss on extinguishment of debt	64			—			—			—			—			64
Loss on sales of investment securities	—			—			(28		)	—			—			(28		)
Changes in operating assets and liabilities:
Receivables, net	(227		)	(1,995		)	4,419			(239		)	1,729			3,687
Inventories	—			(1,632		)	(345		)	—			—			(1,977		)
Excess of black lung benefit obligation over trust assets	(280		)	—			—			(1		)	—			(281		)
Accounts payable and accrued expenses	(1,957		)	4,101			904			(1,146		)	(201		)	1,701
Deferred revenue	—			(4,190		)	(2,025		)	1			—			(6,214		)
Income tax payable	—			—			(55		)	(1		)	—			(56		)
Accrual for workers’ compensation	(284		)	—			—			—			—			(284		)
Asset retirement obligations	—			—			(5,422		)	(2		)	—			(5,424		)
Accrual for postretirement medical benefits	(40		)	—			4,010			124			—			4,094
Pension and SERP obligations	695			9			826			(13		)	—			1,517
Other assets and liabilities	(49		)	101			(1,489		)	(374		)	—			(1,811		)
Distributions received from subsidiaries	36,600			—			—			—			(36,600		)	—
Net cash provided by (used in) operating activities	8,497			5,672			52,034			(610		)	(30,669		)	34,924
Cash flows from investing activities:
Additions to property, plant and equipment	(575		)	(698		)	(12,189		)	(4		)	(1		)	(13,467		)
Change in restricted investments and bond collateral and reclamation deposits	(807		)	(5		)	(7,902		)	—			—			(8,714		)
Net proceeds from sales of assets	—			—			577			—			—			577
Proceeds from the sale of investments	—			—			6,807			—			—			6,807

42

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONT.)

Receivable from customer for property and equipment purchases	—			—			(307		)	(1		)	—			(308		)
Net cash used in investing activities	(1,382		)	(703		)	(13,014		)	(5		)	(1		)	(15,105		)
Cash flows from financing activities:
Change in book overdrafts	—			—			1,777			—			—			1,777
Repayments of long-term debt	(500		)	—			(15,561		)	(9		)	—			(16,070		)
Borrowings on revolving lines of credit	—			—			6,000			—			—			6,000
Repayments on revolving lines of credit	—			—			(6,000		)	—			—			(6,000		)
Debt issuance costs and other refinancing costs	(26		)	—			(156		)	—			—			(182		)
Dividends/distributions	(680		)	(9,000		)	(27,600		)	—			36,600			(680		)
Transactions with Parent/affiliates	(5,080		)	(38		)	8,699			2,349			(5,930		)	—
Net cash provided by (used in) financing activities	(6,286		)	(9,038		)	(32,841		)	2,340			30,670			(15,155		)
Net increase (decrease) in cash and cash equivalents	829			(4,069		)	6,179			1,725			—			4,664
Cash and cash equivalents, beginning of period	14,836			4,545			10,237			1,992			—			31,610
Cash and cash equivalents, end of period	$	15,665		$	476		$	16,416		$	3,717		$	—		$	36,274

43

ITEM 2 —MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

Cautionary Note Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q contains “forward-looking statements.” Forward-looking statements can be identified by words such as “anticipates,” “intends,” “plans,” “seeks,” “believes,” “estimates,” “expects” and similar references to future periods. Examples of forward-looking statements include, but are not limited to, statements we make about our expectation that our cash from operations, cash on hand and available borrowing capacity will be sufficient to meet our investing, financing, and working capital requirements for the foreseeable future, our anticipated cash spend on heritage health and pension obligations, and the possibility that we may from time to time use available cash to repurchase our 10.75% Senior Notes on the open market.

Forward-looking statements are based on our current expectations and assumptions regarding our business, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. Our actual results may differ materially from those contemplated by the forward-looking statements. We therefore caution you against relying on any of these forward-looking statements. They are statements neither of historical fact nor guarantees or assurances of future performance. Important factors that could cause actual results to differ materially from those in the forward-looking statements include political, economic, business, competitive, market, weather and regulatory conditions and the following:

• changes in our post-retirement medical benefit and pension obligations and the impact of the recently enacted healthcare legislation;

• the impact of the recently enacted healthcare legislation and its effect on our employee health benefit costs;

• our potential inability to expand or continue current coal operations due to limitations in obtaining bonding capacity for new mining permits, and/or increases in our mining costs as a result of increased bonding expenses;

• our substantial level of indebtedness and potential inability to maintain compliance with debt covenant requirements;

• the potential inability of our subsidiaries to pay dividends to us due to restrictions in our debt arrangements, reductions in planned coal deliveries or other business factors;

• the effect of Environmental Protection Agency inquiries and regulations on the operations of the power plants to which we provide coal;

• the effect of prolonged maintenance or unplanned outages at our operations or those of our major power generating customers;

• future legislation and changes in regulations, governmental policies and taxes, including those aimed at reducing emissions of elements such as mercury, sulfur dioxides, nitrogen oxides, particulate matter or greenhouse gases;

• our expansion into international operations as a result of the Canadian Acquisition which exposes us to risks relating to exchange rates and exchange controls, general economic and political conditions, costs associated with compliance with governmental regulations in multiple jurisdictions, tax-related risks and export or import requirements for, or restrictions related to, our products;

• our efforts to effectively integrate the Canadian operations with our existing business and our ability to manage our expanded operations following the acquisition;

• our ability to realize growth opportunities and cost synergies as a result of the Canadian Acquisition; and

• other factors that are described in “Risk Factors” in our 2013 Form 10-K and any subsequent quarterly filing on Form 10-Q.

Unless otherwise specified, the forward-looking statements in this report speak as of the filing date of this report. Factors or events that could cause our actual results to differ may emerge from time-to-time, and it is not possible for us to predict all of them. We undertake no obligation to publicly update any forward-looking statements, whether because of new information, future developments or otherwise, except as may be required by law.

44

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS (CONT.)

Overview

Westmoreland Coal Company is an energy company whose operations include sub-bituminous and lignite coal mining in the Western United States and Canada and power operations in the U.S. The operations in the U.S consist of six surface coal mines in Montana, Wyoming, North Dakota and Texas, and two coal-fired power-generating units in North Carolina. Canadian operations consist of six producing thermal coal mines in the Canadian provinces of Alberta and Saskatchewan, a char production facility, and a 50% interest in an activated carbon plant. We sold 24.9 million tons of coal in 2013 and 17.3 million tons through June 30, 2014. Our three principal operating segments are Coal - U.S., Coal - Canada, and Power. Our two non-operating segments are our heritage and corporate segments. Our heritage segment primarily includes the costs of benefits we provide to former mining operation employees and our corporate segment consists primarily of corporate administrative expenses.

We are a holding company and conduct our operations through subsidiaries. We have significant cash requirements to fund our ongoing heritage health benefit costs and corporate overhead expenses. The principal sources of cash flow to us are distributions from our principal operating subsidiaries.

Equity Offering

Subsequent to June 30, 2014, we completed a public offering of 1,684,507 shares of common stock at $35.50 per share for gross proceeds of $59.8 million. We intend to use the net proceeds from the offering to increase our overall financial flexibility, pursue organic and acquisition growth strategies and for general corporate purposes.

Canadian Acquisition

On April 28, 2014, we completed the acquisition of Sherritt International Corporation’s Prairie and Mountain coal mining operations, which include six producing thermal coal mines in the Canadian provinces of Alberta and Saskatchewan, a char production facility, and a 50% interest in an activated carbon plant; collectively referred to as the Canadian properties. The Canadian properties include approximately 649 million tons of total proven or probable coal reserves as of December 31, 2013. The mines have varying estimated lives between 4 and 41 years at current production levels. The purchase consideration included a $282.8 million initial cash payment made on April 28, 2014, a cash payment for a working capital adjustment of $39.8 million made on June 25, 2014, and assumed liabilities of $330.5 million.

In connection with the acquisition of the Canadian properties: (i) proceeds from the private offering of $425.0 million in aggregate principal amount of 10.75% senior secured notes by Westmoreland Escrow Corporation were released from escrow and such notes were automatically exchanged for identical notes issued by Westmoreland and Westmoreland Partners, as co-issuers; (ii) Westmoreland increased its revolving line of credit to $60 million (which borrowing capacity may be increased to $100 million and can be used for borrowings and letters of credit); and (iii) Westmoreland Mining LLC, or WML, a wholly owned subsidiary of Westmoreland, provided prepayment notices to holders of its 8.02% senior secured notes due 2018, which notes were prepaid at the end of May 2014. In connection with the prepayment, we also terminated the WML revolving credit facility.

ROVA Restructuring

On December 23, 2013, we entered into an agreement with Dominion Virginia Power (“DVP”), a subsidiary of Dominion, to restructure the remaining five years of the ROVA I and ROVA II contracts. Pursuant to the restructured agreement, from January 2014 through March 2019, ROVA will be maintained in operational condition and we anticipate running the plants during high demand energy periods to supply DVP under the contract. During low demand periods, we do not anticipate that the plants will be dispatched and the plants would remain in idle status. We additionally buy power from a power provider at fixed prices, referred to as the fixed-price purchased power. Under the terms of the restructured agreement, we may meet DVP’s power needs with the fixed-price purchased power in the event that doing so becomes more economically attractive than our physically operating the ROVA plants to generate power. Alternatively, we have the option to operate the ROVA plants, sell our produced power to DVP and resell the fixed-price purchased power into the open market. The terms of the fixed-price purchased power are as follows:

	April 2014 - December 2014		January 2015 - December 2018
Price per MWh	$	44.09	$	41.05

45

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS (CONT.)

Results of Operations

Items that Affect Comparability of Our Results

For 2014, our results included items that affect comparability of our results. The expense components of these items were as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
	(In thousands)
Acquisition and transition costs	$	(20,175	)	$	—		$	(20,463	)	$	—
Loss on debt extinguishment	(12,635		)	(64		)	(12,635		)	(64		)
Restructuring charges	(7,543		)	—			(7,941		)	—
Derivative losses	(5,930		)	—			(5,930		)	—
Incremental interest incurred before close of transaction	(5,047		)	—			(11,191		)	—
Foreign exchange gain (loss)	2,649			—			(4,141		)	—
Canadian Acquisition bridge facility commitment fee	—			—			(4,875		)	—
Impact (pre-tax)	$	(48,681	)	$	(64	)	$	(67,176	)	$	(64	)

Items recorded in 2014

• We recorded $20.2 million and $20.5 million of acquisition and transition costs for the three and six months ended June 30, 2014, respectively, as a result of our Canadian Acquisition, which includes the impact on cost of sales related to the sale of inventory written up to fair value in the acquisition.

• We recorded $12.6 million of loss on extinguishment of debt for the three and six months ended June 30, 2014 related to the payoff of the WML term debt. This loss included an $11.6 million make-whole payment with the remaining loss due to the write-off of unamortized debt issuance costs.

• We recorded $7.5 million and $7.9 million of restructuring charges for the three and six months ended June 30, 2014, respectively, related to a restructuring plan in order to reduce our overall cost structure. Most of the restructuring charges related to our Canadian operations and included termination benefits and outplacement costs.

• We recorded $5.9 million of derivative losses for the three and six months ended June 30, 2014 related to ROVA's purchased power contract.

• We recorded $5.0 million and $11.2 million of incremental interest expense for the three and six months ended June 30, 2014, respectively, related to the new $425 million senior notes. This incremental interest represents interest expense from the February 7, 2014 closing date of the new senior notes to the April 28, 2014 closing date of the Canadian Acquisition.

• We recorded a $2.6 million gain on foreign exchange for the three months ended June 30, 2014 and a $4.1 million loss on foreign exchange for the six months ended June 30, 2014. The majority of this gain and loss relates to two foreign currency exchange forward contracts to purchase Canadian Dollars in order to hedge a portion of our exposure to fluctuating rates of exchange on Canadian Dollar-denominated Canadian Acquisition cash flows.

• We recorded $4.9 million of interest expense for the six months ended June 30, 2014 related to the Canadian Acquisition bridge facility. Upon closing of the $425 million private offering, our bridge facility commitment expired unexercised and as a result; the related commitment fee of $4.9 million was expensed and is included in Interest expense.

Items recorded in 2013

• We recorded $0.1 million of loss on extinguishment of debt related to repurchases of 10.75% Senior Notes with a principal amount of $0.5 million. The loss on the repurchases was measured based on the carrying value of the repurchased portion of the 10.75% Senior Notes, which included a portion of the unamortized debt issuance costs and the debt discount on the dates of repurchase.

46

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS (CONT.)

Three Months Ended June 30, 2014 Compared to Three Months Ended June 30, 2013

Summary

The following table shows the comparative consolidated results and changes between periods:

	Three Months Ended June 30,
							Increase / (Decrease)
	2014			2013			$			%
	(In millions)
Revenues	$	288.0		$	162.5		$	125.5		77.2	%
Net loss applicable to common shareholders	(63.4		)	(0.6		)	(62.8		)	10,466.7	%
Adjusted EBITDA(1)	39.6			32.0			7.6			23.8	%

____________________

(1) Adjusted EBITDA , a non-GAAP measure, is defined and reconciled to net loss at the end of this “Results of Operations” section.

Our second quarter 2014 revenues increased primarily due to the Canadian Acquisition and new customer sales.

Our second quarter 2014 net loss applicable to common shareholders increased by $14.1 million, excluding $48.7 million of expense during 2014 discussed in Items that Affect Comparability of Our Results. The primary factors, in aggregate, driving this increase in net loss were:

	Three Months Ended June 30, 2014
	(In millions)
Decrease in our power segment operating income due to the restructured ROVA contract and planned outage timing	$	(8.3	)
Increase in interest expense due to increased debt levels	(5.0		)
Decrease in our coal - U.S. segment primarily due to weather impacts, as well as rail service issues at our Absaloka Mine	(3.3		)
Decrease due to other factors	(0.5		)
Increase in our Coal - Canada segment due to the Canadian Acquisition	3.0
Total	$	(14.1	)

Coal - U.S. Segment Operating Results

The following table shows comparative coal revenues, operating income (loss), adjusted EBITDA, sales volume, and percentage changes between periods:

	Three Months Ended June 30,
						Increase / (Decrease)
	2014			2013		$			%
	(In thousands, except per ton data)
Revenues	$	150,107		$	139,337	$	10,770		7.7	%
Operating income (loss)	(423		)	12,572		(12,995		)	(103.4	)%
Adjusted EBITDA(1)	24,039			29,369		(5,330		)	(18.1	)%
Tons sold—millions of equivalent tons	6.4			5.7		0.7			12.3	%

____________________

(1) Adjusted EBITDA, a non-GAAP measure, is defined and reconciled to net loss at the end of this “Results of Operations” section.

Our second quarter 2014 U.S. coal segment revenues and tons sold increased primarily due to new customer sales at our Absaloka Mine. Operating income was negatively impacted by weather impacts, rail service issues at our Absaloka Mine, acquisition costs, and increased maintenance expenses.

47

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS (CONT.)

Coal - Canada Segment Operating Results

The following table shows comparative coal revenues, operating loss, adjusted EBITDA, and sales volume between periods:

	Three Months Ended June 30,
	2014			2013
	(In thousands, except per ton data)
Revenues	$	116,046		$	—
Operating loss	(12,709		)	—
Adjusted EBITDA(1)	21,988			—
Tons sold—millions of equivalent tons	4.1			—

____________________

(1) Adjusted EBITDA, a non-GAAP measure, is defined and reconciled to net loss at the end of this “Results of Operations” section.

The above table represents results from the Canadian Acquisition date of April 28, 2014 to June 30, 2014. Operating income was negatively impacted by $13.6 million of cost of sales related to the sale of inventory written up to fair value in the acquisition and $6.6 million of restructuring charges.

Power Segment Operating Results

The following table shows comparative power revenues, operating income (loss), adjusted EBITDA, and percentage changes between periods:

	Three Months Ended June 30,
						Increase / (Decrease)
	2014			2013		$			%
	(In thousands)
Revenues	$	21,803		$	23,162	$	(1,359	)	(5.9	)%
Operating income (loss)	(9,473		)	4,837		(14,310		)	(295.8	)%
Adjusted EBITDA(1)	(789		)	7,572		(8,361		)	(110.4	)%

____________________

(1) Adjusted EBITDA, a non-GAAP measure, is defined and reconciled to net loss at the end of this “Results of Operations” section.

Our second quarter 2014 power segment revenues and operating income decreased due to the restructured ROVA contract and planned outage timing. Operating income was also negatively impacted by $5.9 million of derivative losses on ROVA's purchased power contracts.

Heritage Segment Operating Results

The following table shows comparative heritage segment’s operating expenses and percentage change between periods:

	Three Months Ended June 30,
					Increase / (Decrease)
	2014		2013		$		%
	(In thousands)
Heritage segment operating expenses	$	3,559	$	3,530	$	29	0.8	%

Our second quarter 2014 heritage segment operating expenses were comparable with the second quarter of 2013.

48

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS (CONT.)

Corporate Segment Operating Results

The following table shows comparative corporate segment’s operating expenses and percentage change between periods:

	Three Months Ended June 30,
					Increase / (Decrease)
	2014		2013		$		%
	(In thousands)
Corporate segment operating expenses	$	3,476	$	1,904	$	1,572	82.6	%

Our second quarter 2014 corporate segment operating expenses increased due to higher compensation expenses.

Nonoperating Results (including interest expense, interest income, other income, income tax expense, and net income attributable to noncontrolling interest)

Our interest expense for the three months ended June 30, 2014 increased by $6.7 million compared to the threemonths ended June 30, 2013 primarily due to higher debt levels, excluding $5.0 million of expenses discussed in Items that Affect Comparability of Our Results.

Our interest income, other income and income tax expense for the three months ended June 30, 2014 increased due to the Canadian Acquisition when compared to the threemonths ended June 30, 2013.

Our net income attributable to noncontrolling interest for the three months ended June 30, 2014 was nil compared with $2.5 million for the threemonths ended June 30, 2013 related to the elimination of the noncontrolling interest effective January 1, 2014.

Six Months Ended June 30, 2014 Compared to Six Months Ended June 30, 2013

Summary

The following table shows the comparative consolidated results and changes between periods:

	Six Months Ended June 30,
							Increase / (Decrease)
	2014			2013			$			%
	(In millions)
Revenues	$	468.2		$	323.9		$	144.3		44.6	%
Net loss applicable to common shareholders	(82.7		)	(3.3		)	(79.4		)	2,406.1	%
Adjusted EBITDA(1)	68.7			57.7			11.0			19.1	%

____________________

(1) Adjusted EBITDA , a non-GAAP measure, is defined and reconciled to net loss at the end of this “Results of Operations” section.

Our revenues for the six months ended June 30, 2014 increased primarily due to the Canadian Acquisition, new customer sales, and fewer customer outages.

49

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS (CONT.)

Our net loss applicable to common shareholders for the six months ended June 30, 2014 increased by $12.2 million, excluding $67.2 million of expense during 2014 discussed in Items that Affect Comparability of Our Results. The primary factors, in aggregate, driving this increase in net loss were:

	June 30, 2014
	(In millions)
Decrease in our power segment operating income due to the restructured ROVA contract	$	(5.1	)
Decrease in our coal - U.S. segment primarily due to weather impacts, as well as rail service issues at our Absaloka Mine	(5.1		)
Increase in interest expense due to increased debt levels	(4.6		)
Decrease due to other factors	(0.4		)
Increase in our Coal - Canada segment due to the Canadian Acquisition	3.0
Total	$	(12.2	)

Coal - U.S. Segment Operating Results

The following table shows comparative coal revenues, operating income, adjusted EBITDA, sales volume, and percentage changes between periods:

	Six Months Ended June 30,
					Increase / (Decrease)
	2014		2013		$			%
	(In thousands, except per ton data)
Revenues	$	308,298	$	281,449	$	26,849		9.5	%
Operating income	12,275		25,566		(13,291		)	(52.0	)%
Adjusted EBITDA(1)	54,332		58,936		(4,604		)	(7.8	)%
Tons sold—millions of equivalent tons	13.2		11.8		1.4			11.9	%

____________________

(1) Adjusted EBITDA, a non-GAAP measure, is defined and reconciled to net loss at the end of this “Results of Operations” section.

Our coal segment revenues and tons sold for the six months ended June 30, 2014 increased primarily due to new customer sales at our Absaloka Mine and fewer customer outages affecting our Absaloka and Beulah Mines. Operating income was negatively impacted by weather impacts, rail service issues at our Absaloka Mine, acquisition costs, and increased maintenance expenses.

Coal - Canada Segment Operating Results

The following table shows comparative coal revenues, operating loss, adjusted EBITDA, and sales volume between periods:

	Six Months Ended June 30,
	2014			2013
	(In thousands, except per ton data)
Revenues	$	116,046		$	—
Operating income	(12,709		)	—
Adjusted EBITDA(1)	21,988			—
Tons sold—millions of equivalent tons	4.1			—

____________________

(1) Adjusted EBITDA, a non-GAAP measure, is defined and reconciled to net loss at the end of this “Results of Operations” section.

The above table represents results from the Canadian Acquisition date of April 28, 2014 to June 30, 2014. Operating income was negatively impacted by $13.6 million of cost of sales related to the sale of inventory written up to fair value in the acquisition and $6.6 million of restructuring charges.

50

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS (CONT.)

Power Segment Operating Results

The following table shows comparative power revenues, operating income, adjusted EBITDA, and percentage changes between periods:

	Six Months Ended June 30,
						Increase / (Decrease)
	2014			2013		$			%
	(In thousands)
Revenues	$	43,815		$	42,498	$	1,317		3.1	%
Operating income (loss)	(7,731		)	3,836		(11,567		)	(301.5	)%
Adjusted EBITDA(1)	4,043			9,281		(5,238		)	(56.4	)%

____________________

(1) Adjusted EBITDA, a non-GAAP measure, is defined and reconciled to net loss at the end of this “Results of Operations” section.

Our power segment operating income decreased to a loss for the six months ended June 30, 2014 due to the restructured ROVA contract. Operating income was also negatively impacted by $5.9 million of derivative losses on ROVA's purchased power contracts.

Heritage Segment Operating Results

The following table shows comparative heritage segment’s operating expenses and percentage change between periods:

	Six Months Ended June 30,
					Increase / (Decrease)
	2014		2013		$			%
	(In thousands)
Heritage segment operating expenses	$	7,389	$	7,705	$	(316	)	(4.1	)%

Our heritage segment operating expenses for the six months ended June 30, 2014 were comparable with the six months ended June 30, 2013.

Corporate Segment Operating Results

The following table shows comparative corporate segment’s operating expenses and percentage change between periods:

	Six Months Ended June 30,
					Increase / (Decrease)
	2014		2013		$		%
	(In thousands)
Corporate segment operating expenses	$	6,034	$	3,987	$	2,047	51.3	%

Our corporate segment operating expenses for the six months ended June 30, 2014 increased due to higher compensation expenses.

Nonoperating Results (including interest expense, interest income, other income, income tax expense, and net income attributable to noncontrolling interest)

Our interest expense for the six months ended June 30, 2014 increased by $6.3 million compared to the sixmonths ended June 30, 2013 primarily due to higher debt levels, excluding $16.1 million of expenses discussed in Items that Affect Comparability of Our Results.

Our interest income, other income and income tax expense for the six months ended June 30, 2014 increased due to the Canadian Acquisition when compared to the sixmonths ended June 30, 2013.

51

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS (CONT.)

Our net income attributable to noncontrolling interest for the six months ended June 30, 2014 was nil compared with $0.8 million for the sixmonths ended June 30, 2013 related to the elimination of the noncontrolling interest effective January 1, 2014.

Reconciliation of Adjusted EBITDA to Net Income (Loss)

The discussion in “Results of Operations” includes references to our Adjusted EBITDA results. EBITDA is defined as earnings before interest expense, interest income, income taxes, depreciation, depletion, amortization and accretion expense. EBITDA and Adjusted EBITDA are supplemental measures of financial performance that are not required by, or presented in accordance with, GAAP. EBITDA and Adjusted EBITDA are key metrics used by us to assess our operating performance and we believe that EBITDA and Adjusted EBITDA are useful to an investor in evaluating our operating performance because these measures:

• are used widely by investors to measure a company’s operating performance without regard to items excluded from the calculation of such terms, which can vary substantially from company to company depending upon accounting methods and book value of assets, capital structure and the method by which assets were acquired, among other factors; and

• help investors to more meaningfully evaluate and compare the results of our operations from period to period by removing the effect of our capital structure and asset base from our operating results.

Neither EBITDA nor Adjusted EBITDA is a measure calculated in accordance with GAAP. The items excluded from EBITDA and Adjusted EBITDA are significant in assessing our operating results. EBITDA and Adjusted EBITDA have limitations as analytical tools, and should not be considered in isolation from, or as a substitute for, analysis of our results as reported under GAAP. For example, EBITDA and Adjusted EBITDA:

• do not reflect our cash expenditures, or future requirements for capital and major maintenance expenditures or contractual commitments;

• do not reflect income tax expenses or the cash requirements necessary to pay income taxes;

• do not reflect changes in, or cash requirements for, our working capital needs; and

• do not reflect the significant interest expense, or the cash requirements necessary to service interest or principal payments, on certain of our debt obligations.

In addition, although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and EBITDA and Adjusted EBITDA do not reflect any cash requirements for such replacements. Other companies in our industry and in other industries may calculate EBITDA and Adjusted EBITDA differently from the way that we do, limiting their usefulness as comparative measures. Because of these limitations, EBITDA and Adjusted EBITDA should not be considered as measures of discretionary cash available to us to invest in the growth of our business. We compensate for these limitations by relying primarily on our GAAP results and using EBITDA and Adjusted EBITDA only as supplemental data.

52

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS (CONT.)

The tables below show how we calculated Adjusted EBITDA, including a breakdown by segment, and reconciles Adjusted EBITDA to net income (loss), the most directly comparable GAAP financial measure.

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
	(In thousands)
Reconciliation of Adjusted EBITDA to Net income (loss)
Net income (loss)	$	(63,154	)	$	2,217		$	(82,185	)	$	(1,870	)
Income tax expense	3,807			28			3,697			55
Interest income	(1,582		)	(280		)	(1,884		)	(577		)
Interest expense	21,786			10,076			42,584			20,236
Depreciation, depletion and amortization	24,479			15,397			40,538			29,823
Accretion of ARO and receivable	5,809			3,156			9,288			6,338
Amortization of intangible assets and liabilities	157			165			310			326
EBITDA	(8,698		)	30,759			12,348			54,331
Restructuring charges	7,543			—			7,941			—
(Gain) loss on foreign exchange	(2,649		)	—			4,141			—
Loss on extinguishment of debt	12,635			64			12,635			64
Acquisition related costs (1)	20,175			—			20,463			—
Customer payments received under loan and lease receivables	3,285			—			3,285			—
Derivative loss	5,930			—			5,930			—
Gain on sale of assets and other adjustments	(385		)	(204		)	(440		)	(506		)
Share-based compensation	1,718			1,385			2,445			3,771
Adjusted EBITDA	$	39,554		$	32,004		$	68,748		$	57,660

____________________

(1) Includes acquisition and transition costs included in Selling and administrative on the Consolidated Statements of Operations and the impact of cost of sales related to the sale of inventory written up to fair value in the Canadian Acquisition.

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
	(In thousands)
Adjusted EBITDA by Segment
Coal - U.S.	$	24,039		$	29,369		$	54,332		$	58,936
Coal - Canada	21,988			—			21,988			—
Power	(789		)	7,572			4,043			9,281
Heritage	(3,559		)	(3,530		)	(7,389		)	(7,705		)
Corporate	(2,125		)	(1,409		)	(4,226		)	(2,852		)
Total	$	39,554		$	32,002		$	68,748		$	57,660

53

WESTMORELAND COAL COMPANY AND SUBSIDIARIES

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS (CONT.)

Liquidity and Capital Resources

We had the following liquidity at June 30, 2014 and December 31, 2013:

	June 30,		December 31,
	2014		2013
	(In millions)
Cash and cash equivalents	$	40.6	$	61.1
WML revolving line of credit	—		23.1
Corporate revolving line of credit	35.0		20.0
Total	$	75.6	$	104.2

We anticipate that our cash from operations, cash on hand and available borrowing capacity will be sufficient to meet our investing, financing, and working capital requirements for the foreseeable future.

We are a holding company and conduct our operations through subsidiaries. Our parent holding company has significant cash requirements to fund our debt obligations, ongoing heritage health benefit costs, pension contributions, and corporate overhead expenses. The principal sources of cash flow to the parent company are distributions from our principal operating subsidiaries. The cash at substantially all of our subsidiaries has no restrictions and is immediately available. The cash at our captive insurance entity is available to us through dividends and is subject to maintaining a statutory minimum level of capital, which is two hundred and fifty thousand dollars.

Under the indenture governing the 10.75% Senior Notes, we are required to offer a portion of our Excess Cash Flow (as defined by the indenture) for each fiscal year to purchase some of these notes at 100% of the principal amount. In addition to any Excess Cash Flow redemption required under the indenture, the Company may continue to use available cash to repurchase these notes on the open market, as permitted by the indenture.

In June, 2014 we started to contribute Company stock to our 401(k) plan instead of cash. Annual requirements for this funding approximates three million dollars.

Debt Obligations

10.75% Senior Notes

The 10.75% Senior Notes (including the Add-On Notes) were outstanding in the principal amount of $675.5 million at June 30, 2014. Interest is due at an annual fixed rate of 10.75% and paid in cash semi-annually, in arrears, on February 1 and August 1 of each year. The 10.75% Senior Notes mature February 1, 2018 and contain provisions that affect our sources of liquidity, such as limitations on our ability to enter into new capital leases and other forms of credit. The notes are fully and unconditionally guaranteed by substantially all of our subsidiaries.

Add-On Notes - 10.75% Senior Notes

On February 7, 2014, we closed on a private offering of $425.0 million in aggregate principal amount of 10.75% senior secured notes due 2018 at a price of 106.875% plus accrued interest from February 1, 2014, referred to as the New Notes. Total proceeds of the offering were $454.2 million, which included $29.2 million of debt premium. The net proceeds of the offering of the New Notes were used to finance the $282.8 million initial cash payment for the Canadian Acquisition and cash transaction costs associated with the Canadian Acquisition and offering of the New Notes of approximately $24.0 million. The remaining balance of the proceeds were used to fund the prepayment of the WML Notes and for other general corporate purposes. In connection with the prepayment, we also terminated the WML revolving credit facility.

Promptly following the completion of the Canadian Acquisition, we exchanged the New Notes for $425.0 million aggregate principal amount of add-on 10.75% senior secured notes due 2018, referred to as the Add-On Notes, and we became party to a registration rights agreement, pursuant to which we agreed to register with the Securities and Exchange Commission the exchange of Add-On Notes for registered notes with the same terms as the existing 10.75% Senior Notes due 2018. We will pay interest on the Add-On Notes semi-annually on February 1st and August 1st of each year beginning on August 1, 2014.

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WESTMORELAND COAL COMPANY AND SUBSIDIARIES

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS (CONT.)

2012 Revolving Credit Agreement

Our 2012 Revolving Credit Agreement has a borrowing limit of $60.0 million and an expiration date of June 30, 2017. The revolver may support up to $60.0 million of letters of credit, which would reduce the balance available under the revolver. At June 30, 2014, availability on the revolver was $35.0 million with no outstanding balance and $25.0 million of supported letters of credit.

Two interest rate options exist under the revolver. The Base Rate option bears interest at the greater of a Federal Funds Rate plus 0.5% or the Prime Rate, as defined in the loan agreement and is payable monthly. The LIBOR Rate option bears interest at the London Interbank Offering Rate, or LIBOR, rate plus 2.25% and is payable monthly. In addition, a commitment fee of 0.75% of the average unused portion of the available revolver is payable monthly.

The loan agreement contains various affirmative, negative and financial covenants. Financial covenants in the agreement include a fixed charge coverage ratio. The fixed charge coverage ratio must meet or exceed a specified minimum. We met these covenant requirements as of June 30, 2014. All extensions of credit under the revolver are collateralized by a first priority security interest in and lien upon the inventory and accounts receivable of the Parent and substantially all of its subsidiaries.

Capital Leases

During the six months ended June 30, 2014, we entered into $12.9 million of new capital leases at our Kemmerer Mine. In addition, we assumed $122.6 million of capital lease obligations in the Canadian Acquisition.

Asset Retirement Obligations

We assumed $102.1 million of asset retirement obligations in the Canadian Acquisition.

Heritage Health Costs and Pension Contributions

Our liquidity continues to be affected by payments of our heritage health and pension obligations as follows:

	Six Months Ended June 30,				2014 Remaining Expected Amounts
	2014		2013
	(In millions)
Postretirement medical benefits	$	5.6	$	6.0	$	8.2
Combined Benefit Fund premiums	1.0		1.2		1.0
Workers’ compensation benefits	0.2		0.4		0.4
Total heritage health payments	$	6.8	$	7.6	$	9.6
Pension contributions	$	1.1	$	—	$	3.2

Historical Sources and Uses of Cash

The following is a summary of cash provided by or used in each of the indicated types of activities:

	Six Months Ended June 30,
	2014			2013
	(In thousands)
Cash provided by (used in):
Operating activities	$	10,573		$	34,924
Investing activities	(360,991		)	(15,105		)
Financing activities	330,956			(15,155		)

Cash provided by operating activities decreased $24.4 million for the six months ended June 30, 2014 compared to the six months ended June 30, 2013 primarily due to increased interest from higher debt levels, Canadian Acquisition costs, unfavorable impacts of weather, and the restructured ROVA contract.

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WESTMORELAND COAL COMPANY AND SUBSIDIARIES

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS (CONT.)

Cash used in investing activities increased $345.9 million for the six months ended June 30, 2014 compared to the six months ended June 30, 2013 primarily due to the $322.6 million cash consideration for the Canadian Acquisition, which includes $39.8 million for a working capital adjustment. Capital expenditures were $17.4 million and $13.5 million for the six months ended June 30, 2014 and 2013, respectively.

Cash provided by financing activities increased $346.1 million for the six months ended June 30, 2014 compared to the six months ended June 30, 2013 primarily due to the Canadian Acquisition debt. Debt repayments were $97.5 million and $16.1 million for the six months ended June 30, 2014 and 2013, respectively.

We had a working capital surplus of $50.8 million at June 30, 2014 compared with a working capital deficit of $8.0 million at December 31, 2013 primarily due to the increase in inventories related to the Canadian Acquisition.

Equity Offering

Subsequent to June 30, 2014, we completed a public offering on July 16, 2014, of 1,684,507 shares of common stock at $35.50 per share for gross proceeds of $59.8 million. We intend to use the net proceeds from the offering to increase our overall financial flexibility, pursue organic and acquisition growth strategies and for general corporate purposes.

Critical Accounting Policies and Estimates

Please refer to the corresponding section in Part II, Item 7 of our 2013 Form 10-K and the footnote disclosures included in Part I, Item I of this report for a discussion of our accounting policies and estimates.

Recent Accounting Pronouncements

See Note 1 of Notes to Consolidated Financial Statements included in “Part I — Item 1 — Financial Statements.”

Off-Balance Sheet Arrangements

In the normal course of business, we are a party to certain off-balance sheet arrangements. These arrangements include financial instruments with off-balance sheet risk such as bank letters of credit and performance or surety bonds. We utilize surety bonds and letters of credit issued by financial institutions to third parties to assure the performance of our obligations relating to reclamation, workers’ compensation obligations, postretirement medical benefit obligations, and other obligations. These arrangements are not reflected in our consolidated balance sheets, and we do not expect any material adverse effects on our financial condition, results of operations or cash flows to result from these off-balance sheet arrangements.

During the six months ended June 30, 2014 we added approximately CAD $143.8 million of surety bonds related to the reclamation obligations for our mines in Canada. We also added approximately $12 million of letters of credit to secure our additional financial obligations related to our Canadian operations.

Our off-balance sheet arrangements are discussed in Management’s Discussion and Analysis of Financial Condition and Results of Operations in our 2013 Form 10-K.

ITEM 3 — QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Other than the changes below, there have been no material changes in our market risk during the six months ended June 30,2014. For additional information, refer to the “Quantitative and Qualitative Disclosures about Market Risk” in Item 7A of our 2013 Form 10-K.

Commodity Risks

We are exposed to commodity price risk on sales of power at our ROVA facility. We have entered into derivative contracts to purchase power in the future at fixed prices. Such derivative contracts are structured to manage our exposure to changing power prices and not for trading.

Foreign Currency Exchange Rates

We are exposed to the effects of changes in exchange rates primarily from the Canadian dollar at our Canadian operations. To address the risks arising from adverse changes in foreign currency exchange rates from our planned cash flows in the Canadian Acquisition we entered into various derivative contracts. All decisions on derivative contracts are authorized and executed pursuant to our policies and procedures, which do not allow the use of financial instruments for trading purposes. There were no foreign currency derivative contracts outstanding as of June 30, 2014.

A description of our accounting policies for derivative financial instruments is included in Notes 1 and 10 to the consolidated financial statements.

ITEM 4 — CONTROLS AND PROCEDURES.

As required by Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, management has evaluated, with the participation of our chief executive officer and chief financial officer, the effectiveness of our disclosure controls and procedures as of June 30, 2014. Disclosure controls and procedures are designed to provide reasonable assurance that material information required to be disclosed in the reports we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the rules and forms of the Securities and Exchange Commission.

Disclosure controls and procedures also include, without limitation, controls and procedures designed to ensure that information required to be disclosed by us in our reports that we file or submit under the Exchange Act is accumulated and communicated to management, including our chief executive officer and chief financial officer, as appropriate to allow timely decisions regarding our required disclosure. Based on that evaluation, our management, including our chief executive officer and chief financial officer, concluded that the disclosure controls and procedures were effective as of such date.

On April 28, 2014, we closed on the Canadian Acquisition. As a result of the acquisition, we are in the process of reviewing the internal controls of the Canadian operations and, if necessary, will make appropriate changes as we incorporate our controls and procedures into the acquired operations. Except for the acquisition, there have been no changes in internal control over financial reporting that occurred during the six months ended June 30, 2014, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II

OTHER INFORMATION

ITEM 1 — LEGAL PROCEEDINGS.

We are subject, from time-to-time, to various proceedings, lawsuits, disputes, and claims (“Actions”) arising in the ordinary course of our business. Many of these Actions raise complex factual and legal issues and are subject to uncertainties. We cannot predict with assurance the outcome of Actions brought against us. Accordingly, adverse developments, settlements, or resolutions may occur and may result in a negative impact on income in the quarter of such development, settlement, or resolution. However, we do not believe that the outcome of any current Action would have a material adverse effect on our financial results.

ITEM 1A — RISK FACTORS.

We have disclosed under the heading “Risk Factors” in our 2013 Form 10-K, the risk factors that we believe materially affect our business, financial condition or results of operations. Except as provided below, there have been no material changes from the risk factors previously disclosed. You should carefully consider the risk factors set forth in the 2013 Form 10-K and the other information set forth elsewhere in this Quarterly Report on Form 10-Q. You should be aware that these risk factors and other information may not describe every risk facing our Company. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition and or operating results.

We may not realize the anticipated benefits of the Canadian Acquisition, including potential synergies, due to challenges associated with integrating the Canadian subsidiaries or other factors.

The long-term success of the Canadian Acquisition on our company will depend in part on the success of our management in efficiently integrating the operations, technologies and personnel of the Canadian subsidiaries. Our management’s inability to meet the challenges involved in successfully integrating the Canadian subsidiaries or to otherwise realize the anticipated benefits of the transaction could harm our results of operations.

The challenges involved in the integration of the Canadian subsidiaries include:

• integrating the operations, processes, people and technologies relating to the Canadian subsidiaries;

• coordinating and integrating regulatory, benefits, operations and development functions;

• demonstrating to customers that the Canadian Acquisition will not result in adverse changes in coal quality, delivery schedules and other relevant deliverables;

• managing and overcoming the unique characteristics of the Canadian subsidiaries, such as the specific mining conditions at each of the acquired mines;

• retaining the personnel of the Canadian subsidiaries and integrating the business cultures, operations, systems and clients of the Canadian subsidiaries with our own;

• consolidating corporate and administrative infrastructures and eliminating duplicative operations and administrative functions; and

• identifying the potential unknown liabilities associated with the Canadian subsidiaries and other Canadian assets.

In addition, the overall integration of the Canadian subsidiaries will require substantial attention from our management, particularly in light of the geographically dispersed operations of the acquired mines relative to our other mines and operations and the unique characteristics of the Canadian assets. If our senior management team is required to devote considerable amounts of time to the integration process, it will decrease the time they will have to manage our business, develop new strategies and grow our business. If our senior management is not able to manage the integration process effectively, or if any significant business activities are interrupted as a result of the integration process, our business could suffer.

Furthermore, the anticipated benefits and synergies of the Canadian Acquisition are based on assumptions and current expectations, with limited actual experience, and assume that we will successfully integrate and reallocate resources without unanticipated costs and that our efforts will not have unforeseen or unintended consequences. In addition, our ability to realize the benefits and synergies of the Canadian Acquisition could be adversely impacted to the extent that relationships with existing or potential customers, suppliers or the workforce of the Canadian subsidiaries is adversely affected as a consequence of the Canadian Acquisition, as a result of further weakening of global economic conditions, or by practical or legal constraints on our ability to successfully integrate the operations of the Canadian assets.

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We cannot assure you that we will successfully or cost-effectively integrate the Canadian assets into our operations in a timely manner, or at all, and we may not realize the anticipated benefits of the acquisition, including potential synergies or growth opportunities, to the extent or in the time frame anticipated. The failure to do so could have a material adverse effect on our financial condition, results of operations and business.

Risks associated with being highly leveraged.

At June 30, 2014, we had outstanding indebtedness of approximately $833.0 million, which includes the $425.0 million aggregate principal amount of 10.75% Senior Secured Notes due 2018 and the capital leases we assumed in the Canadian Acquisition. We may also incur additional indebtedness in the future, including additional indebtedness under our revolving credit facility. Our leverage position may, among other things:

• limit our ability to obtain additional debt financing in the future for working capital, capital expenditures, acquisitions, or other general corporate purposes;

• require us to dedicate a substantial portion of our cash flow from operations to service our debt, reducing the availability of cash flow for other purposes;

• increase our vulnerability to economic downturns, limit our ability to capitalize on significant business opportunities, and restrict our flexibility to react to changes in market or industry conditions; or

• make it more difficult to pay our debts, including payment on the notes, which will mature in 2018.

On January 23, 2014, Moody’s Investor Service, or Moody’s, concluded its review of our ratings which was initiated on December 26, 2013, following the announcement of the Canadian Acquisition, and confirmed our existing credit ratings. However, we cannot assure you that rating agencies will not downgrade the credit rating on the notes in the future. Any such downgrade, or any perceived decrease in our creditworthiness, could impede our ability to refinance existing debt or secure new debt or otherwise increase our future cost of borrowing and could create additional concerns on the part of our customers, partners, investors and employees about our financial condition and results of operations.

As a mine mouth operator, we provide coal to a small group of customers. This dependence could adversely affect our revenues if such customers reduce or suspend their coal purchases or if they become unable to pay for our coal.

In 2013, we derived approximately 67% of our total revenues from coal sales to five power plants: Colstrip Units 3&4 (17%), Naughton Power Station (17%), Limestone Generating Station (13%), Colstrip Units 1 & 2 (13%) and Coyote Station (7%). Similarly, for full-year 2013, the Canadian subsidiaries sold approximately 25% of their total aggregate coal production to two customers, SaskPower (13%) and Capital Power (12%). Interruption in the purchases of coal by our principal customers could significantly affect our revenues.

Unscheduled maintenance outages or other outages at our customers’ power plants, unseasonably moderate weather, higher-than-anticipated hydro seasons or increases in the production of alternative clean-energy generation such as wind power, or decreases in the price of competing fossil fuels such as natural gas, could cause our customers to reduce their purchases. 11 of our 12 mines are dedicated to supplying customers located adjacent to or near the mines, and these mines may have difficulty identifying alternative purchasers of their coal if their existing customers suspend or terminate their purchases.

Additionally, certain of our long-term contracts are set to expire in the next several years. Our contracts with the Sherburne County Station are three-year rolling contracts, with one-third of the tonnage expiring on an annual basis. Our contract with Coyote Station, located adjacent to our Beulah Mine, and averaging approximately 2.5 million tons of coal sold per year, expires in May 2016 and is not expected to be renewed. Our contract with Colstrip Units 3 & 4 expires in December 2019. Should we be unable to successfully renew any or all of these expiring contracts, the reduction in the sale of our coal would adversely affect our operating results and liquidity and could result in significant impairments to the affected mine should the mine be unable to execute a new long-term coal supply agreement. The long term agreements we acquired or subsequently negotiated in connection with the Canadian Acquisition have long-remaining terms with the exception of the contract applicable to Poplar River Mine, which is set to expire in 2015. Coal supply agreements also typically contain force majeure provisions allowing temporary suspension of performance by us or the customer during the duration of specified events beyond the control of the affected party. Additionally, many of our coal supply agreements contain provisions allowing customers to suspend acceptance of coal shipments if coal delivered does not meet certain quality thresholds.

Similarly, interruption in the purchase of power by Dominion North Carolina Power, or Dominion, could also negatively affect our revenues. During the year ended December 31, 2013, the sale of power by our Roanoke Valley Energy Facility, or ROVA, to Dominion accounted for approximately 13% of our consolidated revenues. Although ROVA supplies power to Dominion under long-term power purchase agreements, if Dominion is unable or unwilling to pay for the power produced by ROVA in a timely manner, it could have a material adverse effect on our results of operations, financial condition, and liquidity.

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If the assumptions underlying our reclamation and mine closure obligations are materially inaccurate, we could be required to expend greater amounts than anticipated.

We are subject to stringent reclamation and closure standards for our mining operations. We calculated the total estimated reclamation and mine-closing liabilities according to the guidance provided by GAAP and current industry practice. Estimates of our total reclamation and mine-closing liabilities are based upon permit requirements and our engineering expertise related to these requirements. If our estimates are incorrect, we could be required in future periods to spend materially different amounts on reclamation and mine-closing activities than we currently estimate. Likewise, if our customers, some of whom are contractually obligated to pay certain reclamation costs, default on the unfunded portion of their contractual obligations to pay for reclamation, we could be forced to make these expenditures ourselves and the cost of reclamation could exceed any amount we might recover in litigation.

We estimate that our gross reclamation and mine-closing liabilities, which are based upon projected mine lives, current mine plans, permit requirements and our experience, were $389.4 million (on a present value basis) at June 30, 2014. Of these June 30, 2014 liabilities, our customers have assumed $101.9 million by contract. In addition, we held final reclamation deposits, received from customers, of approximately $75.9 million at June 30, 2014 to provide for these obligations. We estimate that our obligation for final reclamation that was not the contractual responsibility of others or covered by offsetting reclamation deposits was $211.6 million at June 30, 2014. We must recover this $211.6 million from revenues generated by coal sales.

Although we update our estimated costs annually, our recorded obligations may prove to be inadequate due to changes in legislation or standards and the emergence of new restoration techniques. Furthermore, the expected timing of expenditures could change significantly due to changes in commodity costs or prices that might curtail the life of an operation. These recorded obligations could prove insufficient compared to the actual cost of reclamation. Any underestimated or unidentified close down, restoration or environmental rehabilitation costs could have an adverse effect on our reputation as well as our asset values, results of operations and liquidity.

If the cost of obtaining new reclamation bonds and renewing existing reclamation bonds increases or if we are unable to obtain additional bonding capacity, our operating results could be negatively affected.

We are required to provide bonds to secure our obligations to reclaim lands used for mining. We must post a bond before we obtain a permit to mine any new area. These bonds are typically renewable on a yearly basis. Bonding companies are requiring that applicants collateralize increasing portions of their obligations to the bonding company. In 2013, we paid approximately $6.4 million in premiums for reclamation bonds. We anticipate that, as we permit additional areas for our mines, our bonding and collateral requirements could increase. Any cash that we provide to collateralize our obligations to our bonding companies is not available to support our other business activities. Our results of operations could be negatively affected if the cost of our reclamation bonding premiums and collateral requirements were to increase. Additionally, if we are unable to obtain additional bonding capacity due to cash flow constraints, we will be unable to begin mining operations in newly permitted areas, which would hamper our ability to efficiently meet our current customer contract deliveries, expand operations, and increase revenues. We used approximately $48.1 million to collateralize new bonds in connection with the Canadian Acquisition.

Our coal mining operations are subject to external conditions that could disrupt operations and negatively affect our results of operations.

Our coal mining operations are all surface mines. These mines are subject to conditions or events beyond our control that could disrupt operations, affect production, and increase the cost of mining at particular mines for varying lengths of time. These conditions or events include: unplanned equipment failures; geological, hydrological or other conditions such as variations in the quality of the coal produced from a particular seam; variations in the thickness of coal seams and variations in the amounts of rock and other natural materials that overlie the coal that we are mining; weather conditions; and competition and/or conflicts with other natural gas resource extraction activities and production within our operating areas. For example, in our recent past, we have endured poor rail performance at the Absaloka Mine, a major blizzard at the Beulah Mine, a trestle fire at the Beulah Mine, and an unanticipated replacement of boom suspension cables on one of our draglines, all of which interrupted deliveries. Major disruptions in operations at any of our mines over a lengthy period could adversely affect the profitability of our mines.

In addition, unplanned outages of draglines and extensions of scheduled outages due to mechanical failures or other problems occur from time-to-time and are an inherent risk of our coal mining business. Unplanned outages typically increase our operation and maintenance expenses and may reduce our revenues because of selling fewer tons of coal. As of June 30, 2014, five of our 30 owned or operated draglines were not in use due to either equipment servicing or because the dragline was scheduled to be down based on the operational needs of our mines. If properly maintained, a dragline can operate for 40 years

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or longer. As of December 31, 2013, the average age of Westmoreland’s dragline fleet (including the Canadian subsidiaries) was 33 years. In addition, at our Kemmerer Mine we use shovels instead of draglines. If properly maintained, a shovel can last for 30 years or longer. As of December 31, 2013, the average age of our shovels was 16 years. As our draglines, shovels and other major equipment ages, we may experience unscheduled maintenance outages or increased maintenance costs, which would adversely affect our operating results.

Unplanned outages and extensions of scheduled outages due to mechanical failures or other problems occur from time-to-time at our power plant customers and are an inherent risk of our business. Unplanned outages typically increase our operation and maintenance expenses and may reduce our revenues because of selling fewer tons of coal. For example, in November 2011, the Sherburne County station experienced an explosion and fire that caused an extended outage. As a result, we lost approximately 50% of our coal sales in 2012 and 2013 at our Absaloka Mine. While Sherburne County station initially indicated a start-up date of March 2013, it did not ultimately resume operations until October 2013, resulting in additional lost coal sales during 2013. We maintain business interruption insurance coverage to lessen the impact of events such as this, and have received a total of approximately $33.6 million of cash proceeds in insurance compensation for lost sales to the Sherburne County station. While we believe our insurance did not fully compensate us for the impact of lost sales, we believe the shortfall was not material. However, business interruption insurance may not always provide adequate compensation for lost coal sales, and significant unanticipated outages at our power plant customers which result in lost coal sales could result in significant adverse effects on our operating results.

Long-term sales and revenues could be significantly affected by environmental regulations and the effects of the environmental lobby.

A consortium of environmental activists is actively pushing to shut down one-third of the nation’s coal plants by 2020. They are taking particular interest in Colstrip Units 1 and 2 and are actively lobbying the U.S. Environmental Protection Agency, or EPA, to require cost-prohibitive pollution control equipment. In litigation filed in 2012, the activists stated that the EPA’s Best Available Retrofit Technology (“BART”) analysis for regional haze provides support for a determination that additional controls or upgrades to controls to improve regional haze are necessary to achieve BART. A decision in the case is pending. In 2013, environmental groups also filed a citizen suit complaint in Montana district court asserting that the owners and operators of Colstrip are in violation of Clean Air Act requirements. Trial in the case is set for late in 2014. If environmental groups are successful, Colstrip would be required to undergo new permitting and comply with more stringent emission limits applicable to a number of pollutants. If additional emissions controls and upgrades are required at Colstrip Units 1 and 2, it is possible the owners could elect to shut down the units in lieu of making the large capital expenditures required to comply. If such a decision were made, we could lose coal sales of approximately 3.0 million tons per year starting in approximately 2015. The loss of the sale of this tonnage at our Rosebud Mine could have a material adverse effect on the mine’s revenues and profitability.

Additionally, Rocky Mountain Power, the owner of the Naughton Power Station located adjacent to our Kemmerer Mine, which is our Kemmerer Mine’s primary customer, has sought regulatory approval to convert Unit 3 at Naughton to 100% natural gas fueling. When complete, the conversion of Unit 3 to natural gas will result in the loss of coal sales at our Kemmerer Mine. However, Rocky Mountain Power recently announced the conversion of Naughton Unit 3 will not occur until 2018. In addition, price protections built into the contract that are in effect from 2017 to 2021 will partially offset the effects of lowered volume following the conversion of Unit 3. Despite these price protections, the lost sales at the Kemmerer Mine could have a material adverse effect on the mine’s revenues and profitability and on our operating results.

In September 2013, the EPA reproposed new source performance standards for greenhouse gases (“GHG”) that would require new fossil-fuel fired power plants to install carbon capture and sequestration systems. The EPA stated that it intends to finalize the rule by January of 2015. The EPA also is developing GHG standards for existing and modified power plants, initial draft proposals of which the EPA released on June 2, 2014. The proposed rule sets the standard for existing sources as state-specific carbon emission rates that, if finalized, would be phased in between 2020 and 2030. The proposed rule would give states the discretion to use a variety of approaches-including cap-and-trade programs-to meet the standard. The EPA estimates that the proposed existing source rule would reduce CO2 emissions from the power sector by 30 percent by 2030, with a focus on emissions from coal-fired generation. The EPA plans to finalize the rule by June 2015, with state plans due by June 2016, with one- to two-year extensions available. It is difficult to predict at this time the effect these proposed rules would have on our revenues and profitability.

Following the Canadian Acquisition, we are also affected by Canadian GHG emissions regulations. On September 12, 2012, the federal government of Canada released final regulations for reducing GHG emissions from coal-fired electricity generation: “Reduction of Carbon Dioxide Emissions from Coal-Fired Generation of Electricity” (the “Canadian CO2 Regulations”). The Canadian CO2 Regulations will require certain Canadian coal-fired electricity generating plants, effective July 1, 2015, to achieve an average annual emissions intensity performance standard of 420 tons of CO2 per gigawatt hour. The impact of the Canadian CO2 Regulations on existing plants will vary by province and specific location. PMRL’s long-term

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sales could be reduced unless certain existing plants that it supplies or new plants built to replace such existing plants are equipped with carbon capture and sequestration or other technology that achieves the prescribed performance standard, the impact of the Canadian CO2 Regulations is altered by equivalency agreements, or the Canadian CO2 Regulations are changed to lower the performance standard.

In addition, various Canadian provincial governments and other regional initiatives are moving ahead with GHG reduction and other initiatives designed to address climate change. As it is unclear at this time what shape additional regulation in Canada will ultimately take, it is not yet possible to reliably estimate the extent to which such regulations will impact the operations we acquired in the Canadian Acquisition. However, our Canadian operations involve large facilities, so the setting of emissions targets (whether in the manner described above or otherwise) may well affect some or all of our Canadian customers, and may in turn have a material adverse effect on our business, results of operations and financial performance. In addition to directly emitting GHGs, the operations we acquired in the Canadian Acquisition require large quantities of power. Future taxes on or regulation of power producers or an increase in cost of the fuels used in power production (including coal, oil and gas or other products) may also add to our operating costs.

Our Absaloka Mine benefited from Indian Coal Production Tax Credits, or ICTC, the permanent loss of which will adversely affect the financial condition of the operation.

The ICTC, which our Absaloka Mine historically benefited from, expired in December 2013 and has not been extended or renewed. There is no assurance that a renewal, if any is enacted, would be enacted with retroactive effect. The provisions regarding any future renewal may not be as favorable as those that previously existed. Additionally, the investment in Absaloka Coal LLC by our partner did not continue after December 31, 2013. We expect to seek a new partner in the event of a future renewal, but our results of operations will continue to be negatively affected during the interim period and for any period for which the ICTC is not renewed with retroactive effect. From 2009 through 2013, we experienced a yearly average of $3.1 million of income and $6.1 million of cash receipts from Absaloka Coal LLC’s participation in ICTC transactions.

Union represented labor creates an increased risk of work stoppages and higher labor costs.

Approximately 70% of our total U.S. workforce is represented by two labor unions, the International Union of Operating Engineers and the UMWA. Our unionized workforce is spread out amongst the majority of our surface mines. As a majority of our workforce is unionized, there may be an increased risk of strikes and other labor disputes, and our ability to alter labor costs is subject to collective bargaining. The collective bargaining agreement relating to the represented workforce at the Absaloka Mine expired in mid-2011. We were successful in negotiating a new agreement without any work stoppages or other disruptions. In 2012, we were successful in entering into agreements with our workforce at Savage, Kemmerer and Rosebud. If our Jewett Mine operations were to become unionized, we could be subject to additional risk of work stoppages, other labor disputes and higher labor costs, which could adversely affect the stability of production and our results of operations. While strikes are generally a force majeure event in long-term coal supply agreements, thereby exempting the mine from its delivery obligations, the loss of revenue for even a short time could have a material adverse effect on our financial results.

Congress has proposed legislation to enact a law allowing workers to choose union representation solely by signing election cards, which would eliminate the use of secret ballots to elect union representation. While the impact is uncertain, if the government enacts this proposal into law, which would make it administratively easier to unionize, it may lead to more coal mines becoming unionized.

Approximately 65% of our total Canadian workforce is represented by a labor union. There are labor agreements in place with one or more unions at each of the producing mines we acquired in the Canadian Acquisition, other than the Genesee Mine. Our collective bargaining agreement related to the Estevan Mine will expire on June 30, 2015. If we are not successful in negotiating new labor agreements as they expire with any of the Canadian workforce unions or otherwise maintaining strong partnerships with them, it could result in labor disputes, work stoppages or higher labor costs, any of which could have an adverse effect on our business and results of operations.

Following the Canadian Acquisition, we are subject to foreign exchange risk as a result of exposures to changes in currency exchange rates between the U.S. and Canada.

Following the Canadian Acquisition, we face increased exposure to exchange rate fluctuations between the Canadian dollar and U.S. dollar. We realize a large portion of our revenues from sales made from the Canadian assets in Canadian dollars, and many of the expenses incurred by the Canadian assets are recognized in Canadian dollars. The exchange rate of the Canadian dollar to the U.S. dollar has been at or near historic highs in recent years. In the event that the Canadian dollar weakens in comparison to the U.S. dollar, earnings generated from Canadian operations will translate into reduced earnings in our consolidated statements of operations reported in U.S. dollars. In addition, our Canadian subsidiaries also record certain

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accounts receivable and accounts payable, which are denominated in Canadian dollars. Foreign currency transactional gains and losses are realized upon settlement of these assets and obligations.

Following the Canadian Acquisition, fluctuations in the U.S. dollar relative to the Canadian dollar may make it more difficult to perform period-to-period comparisons of our reported results of operations. For purposes of accounting, the assets and liabilities of our Canadian operations will be translated using period-end exchange rates, and the revenues and expenses of our Canadian operations will be translated using average exchange rates during each period. Translation gains and losses are reported in accumulated other comprehensive loss as a component of stockholders’ equity.

Changes in the export and import markets for coal products could affect the demand for our coal, our pricing and our profitability.

Although our mines and the majority of our customers are located in North America, we compete in a worldwide market for coal and coal products. The pricing and demand for our products is affected by a number of global economic factors that are beyond our control and difficult to predict. These factors include:

• currency exchange rates;

• growth of economic development;

• price of alternative sources of electricity or steel;

• worldwide demand for coal and other sources of energy; and

• ocean freight rates.

Any decrease in the aggregate amount of coal exported from the United States and Canada, or any increase in the aggregate amount of coal imported into the United States and Canada, could have a material adverse impact on the demand for our coal, our pricing and our profitability. Ongoing uncertainty in European economies and slowing economies in China, India and Brazil have reduced and may continue to reduce near-term pricing and demand for coal exported from the United States and Canada. The operations we acquired in the Canadian Acquisition include a mine in western Canada that primarily supplies premium thermal coal to the Asian export market. Ownership of this mine will increase our exposure to price fluctuations in the international coal market, and a substantial downturn in demand in the Asian market could have a material adverse effect on our financial condition and results of operations.

Extensive government regulations impose significant costs on our mining operations, and future regulations could increase those costs or limit our ability to produce and sell coal.

The coal mining industry is subject to increasingly strict regulation by federal, state and local authorities with respect to matters such as:

• limitations on land use;

• employee health and safety;

• mandated benefits for retired coal miners;

• mine permitting and licensing requirements;

• reclamation and restoration of mining properties after mining is completed;

• air quality standards;

• discharges to water;

• construction and permitting of facilities required for mining operations, including valley fills and other structures constructed in water bodies and wetlands;

• protection of human health, plant life and wildlife;

• management of the materials generated by mining operations and discharge of these materials into the environment;

• effects of mining on groundwater quality and availability; and

• remediation of contaminated soil, surface and groundwater.

We are required to prepare and present to governmental authorities data concerning the potential effects of any proposed exploration or production of coal on the environment and the public has statutory rights to submit objections to requested permits and approvals. The costs, liabilities and requirements associated with these and other regulations may be costly and time-consuming and may delay commencement or continuation of exploration or production operations. Failure to comply with these regulations may result in the assessment of administrative, civil and criminal penalties, the imposition of

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cleanup and site restoration costs and liens, the issuance of injunctions to limit or cease operations, the suspension or revocation of permits and other enforcement measures that could have the effect of limiting production from our operations. We may also incur costs and liabilities resulting from claims for damages to property or injury to persons arising from our operations. We must compensate employees for work-related injuries. If we do not make adequate provision for our workers’ compensation liabilities, it could harm our future operating results. If we are pursued for any sanctions, costs and liabilities, our mining operations and, as a result, our results of operations, could be adversely affected.

New legislation or regulations and orders may be adopted that may materially adversely affect our mining operations, our cost structure or our customers’ ability to use coal. New legislation or administrative regulations (or new judicial interpretations or administrative enforcement of existing laws and regulations), including proposals related to the protection of the environment that would further regulate and tax the coal industry, may also require us or our customers to change operations significantly or incur increased costs. These regulations, if proposed and enacted in the future, could have a material adverse effect on our financial condition and results of operations.

Concerns regarding climate change are, in many of the jurisdictions in which we operate, leading to increasing interest in, and in some cases enactment of, laws and regulations governing greenhouse gas emissions, which affect the end-users of coal and could reduce the demand for coal as a fuel source and cause the volume of our sales or the prices we receive to decline. These laws and regulations also have imposed, and will continue to impose, costs directly on us.

GHG emissions have increasingly become the subject of international, national, state, provincial and local attention. Coal-fired power plants can generate large amounts of carbon and other GHG emissions. Accordingly, legislation or regulation intended to limit GHGs will likely indirectly affect our coal operations by limiting our customers’ demand for our products or reducing the prices we can obtain, and also may directly affect our own power operations. In the United States, the EPA has issued a notice of finding and determination that emissions of carbon dioxide, methane, nitrous oxide and other GHGs present an endangerment to human health and the environment, which allows the EPA to begin regulating emissions of GHGs under existing provisions of the federal Clean Air Act. The EPA implemented GHG-related reporting and permitting rules. Portions of the EPA’s GHG permitting rules, which were the subject of litigation by some industry groups and states, were recently struck down in part by the U.S. Supreme Court, but the EPA’s authority to impose GHG permitting requirements on a majority of large emissions sources, including coal-fired electric utilities, remain in place. President Obama in June 2013 announced a Climate Action Plan, which included a Presidential Memorandum directing the EPA to issue standards for GHG emissions from existing, modified and reconstructed fossil-fuel fired power plants. The EPA issued a revised proposal with standards for new fossil fuel-fired plants, including coal-fired plants, in September 2013, which the EPA plans to finalize by January 2015. The EPA also has released its “Clean Power Plan” in June 2014, which includes proposed standards for existing and modified sources. Under the Clean Power Plan as currently proposed, the EPA would set standards for existing sources as stringent state-specific carbon emission rates that, if finalized, would be phased in between 2020 and 2030. The proposed rule would give states the discretion to use a variety of approaches-including cap-and-trade programs-to meet the standard. The EPA estimates that the proposed existing source rule would reduce CO2 emissions from the power sector by 30 percent by 2030, with a focus on emissions from coal-fired generation. The EPA plans to finalize the rule by June 2015, with state plans due by June 2016, with one- to two-year extensions available. The U.S. Congress has considered, and in the future may again consider, legislation governing GHG emission, including “cap and trade” legislation that would establish a cap on emissions of GHGs covering much of the economy in the United States and would require most sources of GHG emissions to obtain GHG emission “allowances” corresponding to their annual emissions of GHGs. In addition, coal-fired power plants, including new coal-fired power plants or capacity expansions of existing plants, have become subject to opposition by environmental groups seeking to curb the environmental effects of GHG emissions. It is difficult to predict at this time the effect these proposed rules would have on our revenues and profitability.

In Canada, in September 2012 the federal government released final regulations for reducing GHG emissions from coal-fired electricity generation through the Canadian CO2 Regulations. The Canadian CO2 Regulations will require certain Canadian coal-fired electricity generating units, effective July 1, 2015, to achieve an average annual emissions intensity performance standard of 420 tons of CO2 per gigawatt hour. According to Sherritt International Corporation’s public filings, this performance standard represents approximately one-half of the annual average CO2 emissions intensity of the customer generating assets currently served by the Prairie operations. The performance standard will apply to new units commissioned after July 1, 2015 and to units that are considered to have reached the end of their useful life, generally between 45 and 50 years from the unit’s commissioning date. New and end-of-life units that incorporate technology for carbon capture and sequestration may apply for a temporary exemption from the performance standard that would remain in effect until 2025, provided that certain implementation milestones are met. Provincial equivalency agreements, under which the Canadian CO2 Regulations would stand down, are being negotiated or discussed with the provinces of Alberta and Saskatchewan. The Prairie coal production in the long-term could be reduced unless certain existing units or new units of the customers served by the Prairie operations are equipped with carbon capture and storage or other technology that achieves the prescribed performance standard, the impact of the Regulations is altered by equivalency agreements, or the Canadian CO2 Regulations are changed to

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lower the performance standard. The impact of the Canadian CO2 Regulations on existing units will vary by location and province.

In addition, various Canadian provincial governments and other regional initiatives are moving ahead with GHG reduction and other initiatives designed to address climate change. For example, under the Climate Change and Emissions Management Act (the “CCEM”), the Province of Alberta enacted the “Specified Gas Emitters Regulation.” As of January 1, 2008, this enactment requires certain existing facilities with direct emissions of 100,000 tons or more of certain specified gases to ensure that the net emissions intensity for a year for an established facility must not exceed 88% of the baseline emissions intensity for the facility. For the 2011 compliance period, CVRI’s Coal Valley operations exceeded the 100,000 ton emissions threshold established under the Specified Gas Emitters Regulation, and Coal Valley was required to contribute to the Climate Change and Emissions Management Fund. According to Sherritt International Corporation’s public filings, for the 2012 compliance period, the preliminary calculations indicate Coal Valley will be required to purchase fund credits. It is anticipated that for the next several years, emissions intensity at Coal Valley will increase as the distance between the coal being mined and the processing plant increases. The Government of Alberta has also introduced a complementary Specified Gas Reporting Regulation, which came into force on October 20, 2004. This legislation requires all industrial emitters emitting 50,000 tons or more of CO2 to report their annual GHG emissions in accordance with the specified Gas Reporting Standard published by the Government of Alberta. In Saskatchewan, Bill 126, The Management and Reduction of Greenhouse Gases Act, was passed in 2010 but is not yet proclaimed in force. The legislation provides a framework for the control of GHG emissions by regulated emitters and will be proclaimed once accompanying draft regulations are finalized.

As it is unclear at this time what shape additional regulation in Canada will ultimately take, it is not yet possible to estimate the extent to which such regulations will impact the operations we acquired in the Canadian Acquisition. However, those operations involve large facilities, so the setting of emissions targets (whether in the manner described above or otherwise) may well affect them and may have a material adverse effect on our business, results of operations and financial performance. These developments in both Canada and the United States could have a variety of adverse effects on demand for the coal we produce. For example, laws or regulations regarding GHGs could result in fuel switching from coal to other fuel sources by electricity generators, or require us, or our customers, to employ expensive technology to capture and sequester carbon dioxide. Political and environmental opposition to capital expenditure for coal-fired facilities could affect the regulatory approval required for the retrofitting of existing power plants. For example, the Naughton power facility, which is located adjacent to the Kemmerer Mine, announced in April 2012 that it is seeking regulatory approval to switch Unit 3 to natural gas from coal. The conversion of Naughton Unit 3 to natural gas would result in significant reduction in coal sales from our Kemmerer Mine, and could have a material adverse effect on our results of operations. However, Rocky Mountain Power, the owner of the Naughton facility, recently announced that the conversion will not take place until at least 2018. Political opposition to the development of new coal-fired power plants, or regulatory uncertainty regarding future emissions controls, may result in fewer such plants being built, which would limit our ability to grow in the future.

In addition to directly emitting GHGs, the operations we acquired in the Canadian Acquisition require large quantities of power. Future taxes on or regulation of power producers or the production of coal, oil and gas or other products may also add to our operating costs. And many of the developments in the U.S. discussed above that may affect our customers and demand for our coal could also affect us directly through adverse impacts on ROVA.

Depending on how they evolve, such developments, individually or in the aggregate, may have a material adverse effect on our business, results of operations and financial performance.

Extensive environmental laws, including existing and potential future legislation, treaties and regulatory requirements relating to air emissions other than GHGs, affect our customers and could reduce the demand for coal as a fuel source and cause coal prices and sales of our coal to materially decline, and could impose additional costs on ROVA.

Our customers, as well as ROVA, are subject to extensive environmental regulations particularly with respect to air emissions other than GHG. Coal contains impurities, including but not limited to sulfur, mercury, chlorine and other elements or compounds, many of which are released into the air when coal is burned. The emission of these and other substances is extensively regulated at the federal, state, provincial and local level, and these regulations significantly affect our customers’ ability to use the coal we produce and, therefore, the demand for that coal. For example, the purchaser of coal produced from the Jewett Mine blends our lignite with compliance coal from Wyoming. Tightened nitrogen oxide and new mercury emission standards could result in the customer purchasing an increased blend of the Wyoming coal in order to reduce emissions. Further, increased market prices for sulfur dioxide emissions allowances and increased coal ash management costs could also favor an increased blend of the lower ash Wyoming compliance coal. In such a case, the customer has the option to increase its purchases of other coal and reduce purchases of our coal or terminate our contract. A termination of the contract or a significant reduction in the amount of our coal that is purchased by the customer could have a material adverse effect on our results of operations and financial condition.

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The EPA intends to issue or has issued a number of significant regulations that will impose more stringent requirements relating to air, water and waste controls on electric generating units. These rules include the EPA’s pending new requirements for coal combustion residue (“CCR”) management that may further regulate the handling of wastes from the combustion of coal. In addition, in February 2012, the EPA signed a rule to reduce emissions of mercury and toxic air pollutants from new and existing coal- and oil-fired electric utility steam generating units, often referred to as the MATS Rule. This rule was upheld by the Federal Court of Appeals for the D.C. Circuit in April 2014. In April 2014, the U.S. Supreme Court upheld the EPA’s Cross-State Air Pollution Rule (“CSAPR”), which would require stringent reductions in emissions of nitrogen oxides and sulfur dioxide from power plants in much of the Eastern United States, including Texas and North Carolina. The EPA has filed a motion to have the D.C. Circuit lift its stay on the CSAPR. In May 2014, the EPA Administrator signed a final rule that establishes requirements for cooling water intake structures for the withdrawal of cooling water by electric generating plants; the rule is anticipated to affect over 500 power plants.

Considerable uncertainty is associated with air emissions initiatives. New regulations are in the process of being developed, and many existing and potential regulatory initiatives are subject to review by federal or state agencies or the courts. Stringent air emissions limitations are either in place or are likely to be imposed in the short to medium term, and these limitations will likely require significant emissions control expenditures for many coal-fired power plants. For example, the owners of Units 3 and 4 at Colstrip, adjacent to our Rosebud Mine, are getting considerable pressure from environmental groups to install Selective Catalytic Reduction (“SCR”) technology. Should the owners be forced by the EPA to install such technology, the capital requirements could make the continued operation of the two units unsustainable. As a result, Colstrip and other similarly-situated power plants may switch to other fuels that generate fewer of these emissions or may install more effective pollution control equipment that reduces the need for low-sulfur coal. Any switching of fuel sources away from coal, closure of existing coal-fired power plants, or reduced construction of new coal-fired power plants could have a material adverse effect on demand for, and prices received for, our coal. Alternatively, less stringent air emissions limitations, particularly related to sulfur, to the extent enacted, could make low-sulfur coal less attractive, which could also have a material adverse effect on the demand for, and prices received for, our coal.

The regulation of air emissions in Canada may also reduce the demand for the products of the operations we acquired in the Canadian Acquisition. Specifically, the Alberta Environmental Protection and Enhancement Act (“EPEA”) and the Canadian Environmental Protection Act, 1999 (“CEPA, 1999”) and the provision for the reporting of pollutants via the National Pollutant Release Inventory (“NPRI”), could also have a significant effect on the customers of our Canadian mines, which in turn could, over time, significantly reduce the demand for the coal produced from those mines.

The customers of our Canadian mines must comply with a variety of environmental laws that regulate and restrict air emissions, including the EPEA and its regulations, and the CEPA, 1999. Because many of these customers’ activities generate air emissions from various sources, compliance with these laws requires our customers in Canada to make investments in pollution control equipment and to report to the relevant government authorities if any emissions limits are exceeded or are made in contravention of the applicable regulatory requirements.

These laws restrict the amount of pollutants that our Canadian customer’s facilities can emit or discharge into the environment. The NPRI, for example, is created under authority of the CEPA, 1999 and is a Canada-wide, legislated, and publicly accessible inventory of specific substances that are released into the air, water, and land. The purpose of the NPRI was to provide comprehensive national data on releases of specified substances, and assists with, identifying priorities for action, encouraging voluntary action to reduce releases, tracking the progress of reductions in releases, improving public awareness and understanding of substances released into the environment, and supporting targeted initiatives for regulating the release of substances.

Regulatory authorities can enforce these and other environmental laws through administrative orders to control, prevent or stop a certain activity; administrative penalties for violating certain environmental laws; and judicial proceedings. If environmental regulatory burdens continue to increase for our Canadian customers, as a result of policy changes or increased regulatory reform relating to the substances reported, it could potentially affect customer operations and future demand for coal.

ITEM 2 — UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

The Company's purchases of its common stock during the three months ended June 30, 2014 were as follows:

Period	Total Number of Shares Purchased (1)	Average Price Paid per Share
April 1, 2014	80,740	$	31.38
June 12, 2014	5,698	$	34.37
June 30, 2014	1,679	$	36.28

____________________

(1) Shares purchased as indicated in this table represent the withholding of a portion of restricted shares to cover taxes on vested restricted and unrestricted shares.

ITEM 4 —MINE SAFETY DISCLOSURE.

On July 21, 2010, Congress enacted the Dodd-Frank Wall Street Reform and Consumer Protection Act, or the Act. Section 1503(a) of the Act contains reporting requirements regarding mine safety. Mine safety violations and other regulatory matters, as required by Section 1503(a) of the Act and Item 104 of Regulation S-K, are included as Exhibit 95.1 to this report on Form 10-Q.

ITEM 6 — EXHIBITS.

See Exhibit Index at the end of this report.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		WESTMORELAND COAL COMPANY
Date:	July 31, 2014	/s/ Kevin A. Paprzycki
		Kevin A. Paprzycki
		Chief Financial Officer and Treasurer (Principal Financial Officer and A Duly Authorized Officer)
Date:	July 31, 2014	/s/ Russell H. Werner
		Russell H. Werner
		Controller (Principal Accounting Officer and A Duly Authorized Officer)

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EXHIBIT INDEX

		Incorporated by Reference
Exhibit Number	Exhibit Description	Form	File Number	Exhibit	Filing Date	Filed Herewith	Submitted Herewith
1.1	Underwriting Agreement dated July 10, 2014 among Westmoreland Coal Company, BMO Capital Markets Corp. and Deutsche Bank Securities Inc., as representatives of the several underwriters	8-K	001-11155	1.1	7/16/2014
10.1	Form of 2014 Time Vested Restricted Stock Unit Agreement for Directors					X
10.2	Form of Time Vested Restricted Stock Unit Agreement for 2014 Awards					X
10.3	Form of Performance Vested Restricted Stock Unit Agreement for 2014 Awards					X
10.4	Amending Agreement, dated as of April 27, 2014, by and among Westmoreland, Sherritt, Altius Minerals Corporation and the other parties thereto	8-K	001-11155	10.1	5/2/2014
10.5	Third Supplemental Indenture, dated as of April 28, 2014, by and among Westmoreland, Westmoreland Partners, Wells Fargo Bank, National Association, as trustee, Wells Fargo Bank, National Association, as note collateral agent, and the guarantors party thereto	8-K	001-11155	10.2	5/2/2014
10.6	Fourth Supplemental Indenture, dated as of April 28, 2014, by and among Westmoreland, Westmoreland Partners, Wells Fargo Bank, National Association, as trustee, Wells Fargo Bank, National Association, as note collateral agent, and the new guarantors party thereto	8-K	001-11155	10.3	5/2/2014
10.7	Registration Rights Agreement, dated as of April 28, 2014, by and among Westmoreland, Westmoreland Partners, the guarantors party thereto, and BMO Capital Markets Corp. and Deutsche Bank Securities Inc.	8-K	001-11155	10.4	5/2/2014
10.8	Amended and Restated Loan and Security Agreement, dated as of April 28, 2014, by and among Westmoreland, certain of its subsidiaries, The PrivateBank and Trust Company, as Administrative Agent, and the lenders party thereto	8-K	001-11155	10.5	5/2/2014
10.9	Amended and Restated Intercreditor Agreement, dated as of April 28, 2014, by and among Wells Fargo Bank, National Association, as note collateral agent, The PrivateBank and Trust Company, as administrative agent, acknowledged and agreed to by Westmoreland and certain of its subsidiaries	8-K	001-11155	10.6	5/2/2014
31.1	Certification of Chief Executive Officer pursuant to Rule 13a-14(a)					X
31.2	Certification of Chief Financial Officer pursuant to Rule 13a-14(a)					X
32	Certifications of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350					X
95.1	Mine Safety Disclosure					X
101.INS	XBRL Instance Document					X
101.SCH	XBRL Taxonomy Extension Schema Document					X
101.CAL	XBRL Taxonomy Calculation Linkbase Document					X
101.LAB	XBRL Taxonomy Label Linkbase Document					X
101.PRE	XBRL Taxonomy Presentation Linkbase Document					X
101.DEF	XBRL Taxonomy Definition Document					X

Attached as Exhibit 101 to this report are documents formatted in XBRL (Extensible Business Reporting Language). The financial information contained in the XBRL-related document is "unaudited" or "unreviewed."

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EX-10.1

Exhibit 10.1

Westmoreland Coal Company

2014 Equity Incentive Plan

Time Vested Restricted Stock Unit Agreement

This Restricted Stock Unit Agreement (this “Agreement”) is made and entered into as of [DATE] (the “Grant Date”) by and between Westmoreland Coal Company, a Delaware corporation (the “Company”) and ________________________________ (the “Director”).

WHEREAS, the Company has adopted the 2014 Equity Incentive Plan (the “Plan”) pursuant to which awards of Restricted Stock Units may be granted; and

WHEREAS, the Committee has determined that it is in the best interests of the Company and its shareholders to grant the award of Restricted Stock Units provided for herein.

NOW, THEREFORE, the parties hereto, intending to be legally bound, agree as follows:

SECTION 1. GRANT OF RESTRICTED STOCK UNITS.

1.1    Pursuant to the Plan, the Company hereby issues to the Director on the Grant Date an Award consisting of, in the aggregate, __________ [NUMBER] Restricted Stock Units (the “Restricted Stock Units” or “RSUs”). Each Restricted Stock Unit represents the right to receive one share of Common Stock, subject to the terms and conditions set forth in this Agreement and the Plan. Capitalized terms that are used but not defined herein have the meaning ascribed to them in the Plan.

1.2    The Restricted Stock Units shall be credited to a separate account maintained for the Director on the books and records of the Company (the “Account”). All amounts credited to the Account shall continue for all purposes to be part of the general assets of the Company.

SECTION 2. CONSIDERATION.

The grant of the Restricted Stock Units is made in consideration of the services to be rendered by the Director to the Company.

SECTION 3. VESTING.

3.1    Except as otherwise provided herein, provided that the Director remains in Continuous Service through such date, the Restricted Stock Units will vest on [DATE]. Once vested, the Restricted Stock Units become “Vested Units.”

3.2    The foregoing paragraph notwithstanding, if the Director’s Continuous Service terminates as a result of the Director’s [death or Disability,], 100% of the unvested Restricted Stock Units shall vest as of the date of such termination.] [Add provisions for retirement-eligible?]

3.3    The foregoing vesting schedule notwithstanding, if a Change in Control occurs and the Director’s Continuous Service is terminated by the Company or an Affiliate without Cause, and the Director’s date of termination occurs within [twelve (12) months/

Director / Stock Settled / Time Vested

[ALTERNATIVE PERIOD]] following the Change in Control, all unvested Restricted Stock Units shall automatically become 100% vested on the Director’s date of termination. [Not necessary, with one-year vesting period?]

SECTION 4. RESTRICTIONS.

Subject to any exceptions set forth in this Agreement or the Plan, during the Restricted Period and until such time as the Restricted Stock Units are settled in accordance with Section 6, the Restricted Stock Units or the rights relating thereto may not be assigned, alienated, pledged, attached, sold or otherwise transferred or encumbered by the Director. Any attempt to assign, alienate, pledge, attach, sell or otherwise transfer or encumber the Restricted Stock Units or the rights relating thereto shall be wholly ineffective and, if any such attempt is made, the Restricted Stock Units will be forfeited by the Director and all of the Director’s rights to such units shall immediately terminate without any payment or consideration by the Company.

SECTION 5. RIGHTS AS SHAREHOLDER; DIVIDEND EQUIVALENTS.

5.1    The Director shall not have any rights of a shareholder with respect to the shares of Common Stock underlying the Restricted Stock Units unless and until the Restricted Stock Units vest and are settled by the issuance of such shares of Common Stock.

5.2    Upon and following the settlement of the Restricted Stock Units, the Director shall be the record owner of the shares of Common Stock underlying the Restricted Stock Units unless and until such shares are sold or otherwise disposed of, and as record owner shall be entitled to all rights of a shareholder of the Company (including voting rights).

5.3    [Until such time as the Restricted Stock Units vest, the Director’s Account shall be credited with an amount equal to all cash [and stock] dividends (“Dividend Equivalents”) that would have been paid to the Director if one share of Common Stock had been issued on the Grant Date for each Restricted Stock Unit granted to the Director as set forth in this Agreement. [Dividend Equivalents shall be withheld by the Company for the Director’s Account and interest may be credited on the amount of cash Dividend Equivalents withheld at a rate and subject to such terms as determined by the Committee. Dividend Equivalents shall be subject to the same vesting restrictions as the Restricted Stock Units to which they are attributable and shall be paid on the same date that the Restricted Stock Units to which they are attributable are settled in accordance with Section 6 hereof/Dividend Equivalents shall be paid in the same year that dividends are paid to shareholders.] Dividend Equivalents credited to a Director’s Account shall be distributed in cash or, at the discretion of the Committee, in shares of Common Stock having a Fair Market Value equal to the amount of the Dividend Equivalents and interest, if any.]

SECTION 6. SETTLEMENT OF RESTRICTED STOCK UNITS.

6.1    Subject to Section 9 hereof, promptly following the vesting date, and in any event no later than [March 15] of the calendar year following the calendar year in which such vesting occurs, the Company shall (a) issue and deliver to the Director the number of shares of Common Stock equal to the number of Vested Units [and cash equal to any Dividend Equivalents credited with respect to such Vested Units and the interest thereon or, at the discretion of the Committee, shares of Common Stock having a Fair Market Value equal to such

2

Dividend Equivalents and the interest thereon]; and (b) enter the Director’s name on the books of the Company as the shareholder of record with respect to the shares of Common Stock delivered to the Director. [Revise if Company wants discretion to settle in cash, notwithstanding accounting consequences.]

6.2    [Notwithstanding Section 6.1, in accordance with the Plan, the Committee may, but is not required to, prescribe rules pursuant to which the Director may elect to defer settlement of the Restricted Stock Units. Any deferral election must be made in compliance with such rules and procedures as the Committee deems advisable.]

SECTION 7. NO RIGHT TO CONTINUED SERVICE.

Neither the Plan nor this Agreement shall confer upon the Director any right to be retained as a Director of the Company. Further, nothing in the Plan or this Agreement shall be construed to limit the discretion of the Company to terminate the Director’s Continuous Service at any time, with or without Cause.

SECTION 8. ADJUSTMENTS.

If any change is made to the outstanding Common Stock or the capital structure of the Company, if required, the Restricted Stock Units shall be adjusted or terminated in any manner as contemplated by of the Plan.

SECTION 9. TAX LIABILITY AND WITHHOLDING.

9.1    The Director shall be required to pay to the Company, and the Company shall have the right to deduct from any compensation paid to the Director pursuant to the Plan, the amount of any required withholding taxes in respect of the Restricted Stock Units and to take all such other action as the Committee deems necessary to satisfy all obligations for the payment of such withholding taxes. The Committee may permit the Director to satisfy any federal, state or local tax withholding obligation by any of the following means, or by a combination of such means:

a. tendering a cash payment.

b. authorizing the Company to withhold shares of Common Stock from the shares of Common Stock otherwise issuable or deliverable to the Director as a result of the vesting of the Restricted Stock Units; provided, however, that no shares of Common Stock shall be withheld with a value exceeding the minimum amount of tax required to be withheld by law.

c. delivering to the Company previously owned and unencumbered shares of Common Stock.

9.2    Notwithstanding any action the Company takes with respect to any or all income tax, social insurance, payroll tax, or other tax-related withholding (“Tax-Related Items”), the ultimate liability for all Tax-Related Items is and remains the Director’s responsibility and the Company (a) makes no representation or undertakings regarding the treatment of any Tax-

3

Related Items in connection with the grant, vesting or settlement of the Restricted Stock Units or the subsequent sale of any shares; and (b) does not commit to structure the Restricted Stock Units to reduce or eliminate the Director’s liability for Tax-Related Items.

SECTION 10. MISCELLANEOUS PROVISIONS

10.1    Compliance with Law. The issuance and transfer of shares of Common Stock shall be subject to compliance by the Company and the Director with all applicable requirements of federal and state securities laws and with all applicable requirements of any stock exchange on which the Company’s shares of Common Stock may be listed. No shares of Common Stock shall be issued or transferred unless and until any then applicable requirements of state and federal laws and regulatory agencies have been fully complied with to the satisfaction of the Company and its counsel.

10.2    Notices. Any notice required to be delivered to the Company under this Agreement shall be in writing and addressed to the [Secretary/[OTHER POSITION]] of the Company at the Company’s principal corporate offices. Any notice required to be delivered to the Director under this Agreement shall be in writing and addressed to the Director at the Director’s address as shown in the records of the Company. Either party may designate another address in writing (or by such other method approved by the Company) from time to time.

10.3    Governing Law. This Agreement will be construed and interpreted in accordance with the laws of the State of Delaware without regard to conflict of law principles.

10.4    Interpretation. Any dispute regarding the interpretation of this Agreement shall be submitted by the Director or the Company to the Committee for review. The resolution of such dispute by the Committee shall be final and binding on the Director and the Company.

10.5    Restricted Stock Units Subject to Plan. This Agreement is subject to the Plan as approved by the Company’s shareholders. The terms and provisions of the Plan as it may be amended from time to time are hereby incorporated herein by reference. In the event of a conflict between any term or provision contained herein and a term or provision of the Plan, the applicable terms and provisions of the Plan will govern and prevail.

10.6    Successors and Assigns. The Company may assign any of its rights under this Agreement. This Agreement will be binding upon and inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer set forth herein, this Agreement will be binding upon the Director and the Director’s beneficiaries, executors, administrators and the person(s) to whom the Restricted Stock Units may be transferred by will or the laws of descent or distribution.

10.7    Severability. The invalidity or unenforceability of any provision of the Plan or this Agreement shall not affect the validity or enforceability of any other provision of the Plan or this Agreement, and each provision of the Plan and this Agreement shall be severable and enforceable to the extent permitted by law.

10.8    Discretionary Nature of Plan. The Plan is discretionary and may be amended, cancelled or terminated by the Company at any time, in its discretion. The grant of the Restricted

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Stock Units in this Agreement does not create any contractual right or other right to receive any Restricted Stock Units or other Awards in the future. Future Awards, if any, will be at the sole discretion of the Company. Any amendment, modification, or termination of the Plan shall not constitute a change or impairment of the terms and conditions of the Director’s employment with the Company.

10.9    Amendment. The Committee has the right to amend, alter, suspend, discontinue or cancel the Restricted Stock Units, prospectively or retroactively; provided, that, no such amendment shall adversely affect the Director’s material rights under this Agreement without the Director’s consent.

10.10    Section 409A. This Agreement is intended to comply with Section 409A of the Code or an exemption thereunder and shall be construed and interpreted in a manner that is consistent with the requirements for avoiding additional taxes or penalties under Section 409A of the Code. Notwithstanding the foregoing, the Company makes no representations that the payments and benefits provided under this Agreement comply with Section 409A of the Code and in no event shall the Company be liable for all or any portion of any taxes, penalties, interest or other expenses that may be incurred by the Director on account of non-compliance with Section 409A of the Code.

10.11    No Impact on Other Benefits. The value of the Director’s Restricted Stock Units is not part of his or her normal or expected compensation for purposes of calculating any severance, retirement, welfare, insurance or similar employee benefit, except to the extent required under the terms of any qualified pension plan.

10.12    Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original but all of which together will constitute one and the same instrument. Counterpart signature pages to this Agreement transmitted by facsimile transmission, by electronic mail in portable document format (.pdf), or by any other electronic means intended to preserve the original graphic and pictorial appearance of a document, will have the same effect as physical delivery of the paper document bearing an original signature.

10.13    Acceptance. The Director hereby acknowledges receipt of a copy of the Plan and this Agreement. The Director has read and understands the terms and provisions thereof, and accepts the Restricted Stock Units subject to all of the terms and conditions of the Plan and this Agreement. The Director acknowledges that there may be adverse tax consequences upon the vesting or settlement of the Restricted Stock Units or disposition of the underlying shares and that the Director has been advised to consult a tax advisor prior to such vesting, settlement or disposition.

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written.

Westmoreland Coal Company

By: _____________________

Name:

Title:

[EMPLOYEE NAME]

By: _____________________

Name:

6

EX-10.2

Exhibit 10.2

WESTMORELAND COAL COMPANY

2014 EQUITY INCENTIVE PLAN

TIME VESTED RESTRICTED STOCK UNIT AGREEMENT

This Restricted Stock Unit Agreement (this “Agreement”) is made and entered into as of [DATE] (the “Grant Date”) by and between Westmoreland Coal Company, a Delaware corporation (the “Company”) and ________________________________ (the “Grantee”).

WHEREAS, the Company has adopted the 2014 Equity Incentive Plan (the “Plan”) pursuant to which awards of Restricted Stock Units may be granted; and

WHEREAS, the Committee has determined that it is in the best interests of the Company and its shareholders to grant the award of Restricted Stock Units provided for herein.

NOW, THEREFORE, the parties hereto, intending to be legally bound, agree as follows:

SECTION 1. GRANT OF RESTRICTED STOCK UNITS.

1.1    Pursuant to the Plan, the Company hereby issues to the Grantee on the Grant Date an Award consisting of, in the aggregate, __________ [NUMBER] Restricted Stock Units (the “Restricted Stock Units” or “RSUs”). Each Restricted Stock Unit represents the right to receive one share of Common Stock, subject to the terms and conditions set forth in this Agreement and the Plan. Capitalized terms that are used but not defined herein have the meaning ascribed to them in the Plan.

1.1    The Restricted Stock Units shall be credited to a separate account maintained for the Grantee on the books and records of the Company (the “Account”). All amounts credited to the Account shall continue for all purposes to be part of the general assets of the Company.

SECTION 2. CONSIDERATION.

The grant of the Restricted Stock Units is made in consideration of the services to be rendered by the Grantee to the Company.

SECTION 3. VESTING.

3.1    Except as otherwise provided herein, provided that the Grantee remains in Continuous Service through the applicable vesting date[, and further provided that any additional conditions and performance goals set forth in Schedule I have been satisfied], the Restricted Stock Units will vest in accordance with the following schedule (the period during which restrictions apply, the “Restricted Period”):

Vesting Date	Number of Restricted Stock Units That Vest
1st anniversary of Grant Date	1/3
2nd anniversary of Grant Date	1/3
3rd anniversary of Grant Date	1/3

Once vested, the Restricted Stock Units become “Vested Units.”

Employee / Stock Settled / Time Vested

3.2    The foregoing vesting schedule notwithstanding, if the Grantee’s Continuous Service terminates as a result of the Grantee’s [death,] [Disability,] [a termination by the Company or an Affiliate without Cause] [or] [a termination by the Grantee for Good Reason], 100% of the unvested Restricted Stock Units shall vest as of the date of such termination.]

3.3    The foregoing vesting schedule notwithstanding, if a Change in Control occurs and the Grantee’s Continuous Service is terminated by the Company or an Affiliate without Cause or by the Grantee for Good Reason, and the Grantee’s date of termination occurs (or in the case of the Grantee’s termination of Continuous Service for Good Reason, the event giving rise to Good Reason occurs) within [twelve (12) months/[ALTERNATIVE PERIOD]] following the Change in Control, all unvested Restricted Stock Units shall automatically become 100% vested on the Grantee’s date of termination.

SECTION 4. RESTRICTIONS.

Subject to any exceptions set forth in this Agreement or the Plan, during the Restricted Period and until such time as the Restricted Stock Units are settled in accordance with Section 6, the Restricted Stock Units or the rights relating thereto may not be assigned, alienated, pledged, attached, sold or otherwise transferred or encumbered by the Grantee. Any attempt to assign, alienate, pledge, attach, sell or otherwise transfer or encumber the Restricted Stock Units or the rights relating thereto shall be wholly ineffective and, if any such attempt is made, the Restricted Stock Units will be forfeited by the Grantee and all of the Grantee’s rights to such units shall immediately terminate without any payment or consideration by the Company.

SECTION 5. RIGHTS AS SHAREHOLDER; DIVIDEND EQUIVALENTS.

5.1    The Grantee shall not have any rights of a shareholder with respect to the shares of Common Stock underlying the Restricted Stock Units unless and until the Restricted Stock Units vest and are settled by the issuance of such shares of Common Stock.

5.2    Upon and following the settlement of the Restricted Stock Units, the Grantee shall be the record owner of the shares of Common Stock underlying the Restricted Stock Units unless and until such shares are sold or otherwise disposed of, and as record owner shall be entitled to all rights of a shareholder of the Company (including voting rights).

5.3    [Until such time as the Restricted Stock Units vest, the Grantee’s Account shall be credited with an amount equal to all cash [and stock] dividends (“Dividend Equivalents”) that would have been paid to the Grantee if one share of Common Stock had been issued on the Grant Date for each Restricted Stock Unit granted to the Grantee as set forth in this Agreement. [Dividend Equivalents shall be withheld by the Company for the Grantee’s Account and interest may be credited on the amount of cash Dividend Equivalents withheld at a rate and subject to such terms as determined by the Committee. Dividend Equivalents shall be subject to the same vesting restrictions as the Restricted Stock Units to which they are attributable and shall be paid on the same date that the Restricted Stock Units to which they are attributable are settled in accordance with Section 6 hereof/Dividend Equivalents shall be paid in the same year that dividends are paid to shareholders.] Dividend Equivalents credited to a Grantee’s Account

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shall be distributed in cash or, at the discretion of the Committee, in shares of Common Stock having a Fair Market Value equal to the amount of the Dividend Equivalents and interest, if any.]

SECTION 6. SETTLEMENT OF RESTRICTED STOCK UNITS.

6.1    Subject to Section 9 hereof, promptly following the vesting date, and in any event no later than [March 15] of the calendar year following the calendar year in which such vesting occurs, the Company shall (a) issue and deliver to the Grantee the number of shares of Common Stock equal to the number of Vested Units [and cash equal to any Dividend Equivalents credited with respect to such Vested Units and the interest thereon or, at the discretion of the Committee, shares of Common Stock having a Fair Market Value equal to such Dividend Equivalents and the interest thereon]; and (b) enter the Grantee’s name on the books of the Company as the shareholder of record with respect to the shares of Common Stock delivered to the Grantee. [Revise if Company wants discretion to settle in cash, notwithstanding accounting consequences.]

6.2    [Notwithstanding Section 6.1, in accordance with the Plan, the Committee may, but is not required to, prescribe rules pursuant to which the Grantee may elect to defer settlement of the Restricted Stock Units. Any deferral election must be made in compliance with such rules and procedures as the Committee deems advisable.]

6.3    [If the Grantee is deemed a “specified employee” within the meaning of Section 409A of the Code, as determined by the Committee, at a time when the Grantee becomes eligible for settlement of the RSUs upon his “separation from service” within the meaning of Section 409A of the Code, then to the extent necessary to prevent any accelerated or additional tax under Section 409A of the Code, such settlement will be delayed until the earlier of: (a) the date that is six months following the Grantee’s separation from service and (b) the Grantee’s death.]

SECTION 7. NO RIGHT TO CONTINUED SERVICE.

Neither the Plan nor this Agreement shall confer upon the Grantee any right to be retained in any position, as an Employee or Director of the Company. Further, nothing in the Plan or this Agreement shall be construed to limit the discretion of the Company to terminate the Grantee’s Continuous Service at any time, with or without Cause.

SECTION 8. ADJUSTMENTS.

If any change is made to the outstanding Common Stock or the capital structure of the Company, if required, the Restricted Stock Units shall be adjusted or terminated in any manner as contemplated by of the Plan.

SECTION 9. TAX LIABIITY AND WITHHOLDING.

9.1    The Grantee shall be required to pay to the Company, and the Company shall have the right to deduct from any compensation paid to the Grantee pursuant to the Plan, the amount of any required withholding taxes in respect of the Restricted Stock Units and to take all such other action as the Committee deems necessary to satisfy all obligations for the payment of such withholding taxes. The Committee may permit the Grantee to satisfy any federal, state or

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local tax withholding obligation by any of the following means, or by a combination of such means:

a. tendering a cash payment.

b. authorizing the Company to withhold shares of Common Stock from the shares of Common Stock otherwise issuable or deliverable to the Grantee as a result of the vesting of the Restricted Stock Units; provided, however, that no shares of Common Stock shall be withheld with a value exceeding the minimum amount of tax required to be withheld by law.

c. delivering to the Company previously owned and unencumbered shares of Common Stock.

9.2    Notwithstanding any action the Company takes with respect to any or all income tax, social insurance, payroll tax, or other tax-related withholding (“Tax-Related Items”), the ultimate liability for all Tax-Related Items is and remains the Grantee’s responsibility and the Company (a) makes no representation or undertakings regarding the treatment of any Tax-Related Items in connection with the grant, vesting or settlement of the Restricted Stock Units or the subsequent sale of any shares; and (b) does not commit to structure the Restricted Stock Units to reduce or eliminate the Grantee’s liability for Tax-Related Items.

SECTION 10. MISCELLANEOUS PROVISIONS.

10.1    Compliance with Law. The issuance and transfer of shares of Common Stock shall be subject to compliance by the Company and the Grantee with all applicable requirements of federal and state securities laws and with all applicable requirements of any stock exchange on which the Company’s shares of Common Stock may be listed. No shares of Common Stock shall be issued or transferred unless and until any then applicable requirements of state and federal laws and regulatory agencies have been fully complied with to the satisfaction of the Company and its counsel.

10.2    Notices. Any notice required to be delivered to the Company under this Agreement shall be in writing and addressed to the [Secretary/[OTHER POSITION]] of the Company at the Company’s principal corporate offices. Any notice required to be delivered to the Grantee under this Agreement shall be in writing and addressed to the Grantee at the Grantee’s address as shown in the records of the Company. Either party may designate another address in writing (or by such other method approved by the Company) from time to time.

10.3    Governing Law. This Agreement will be construed and interpreted in accordance with the laws of the State of Delaware without regard to conflict of law principles.

10.4    Interpretation. Any dispute regarding the interpretation of this Agreement shall be submitted by the Grantee or the Company to the Committee for review. The resolution of such dispute by the Committee shall be final and binding on the Grantee and the Company.

10.5    Restricted Stock Units Subject to Plan. This Agreement is subject to the Plan as approved by the Company’s shareholders. The terms and provisions of the Plan as it may be

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amended from time to time are hereby incorporated herein by reference. In the event of a conflict between any term or provision contained herein and a term or provision of the Plan, the applicable terms and provisions of the Plan will govern and prevail.

10.6    Successors and Assigns. The Company may assign any of its rights under this Agreement. This Agreement will be binding upon and inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer set forth herein, this Agreement will be binding upon the Grantee and the Grantee’s beneficiaries, executors, administrators and the person(s) to whom the Restricted Stock Units may be transferred by will or the laws of descent or distribution.

10.7    Severability. The invalidity or unenforceability of any provision of the Plan or this Agreement shall not affect the validity or enforceability of any other provision of the Plan or this Agreement, and each provision of the Plan and this Agreement shall be severable and enforceable to the extent permitted by law.

10.8    Discretionary Nature of Plan. The Plan is discretionary and may be amended, cancelled or terminated by the Company at any time, in its discretion. The grant of the Restricted Stock Units in this Agreement does not create any contractual right or other right to receive any Restricted Stock Units or other Awards in the future. Future Awards, if any, will be at the sole discretion of the Company. Any amendment, modification, or termination of the Plan shall not constitute a change or impairment of the terms and conditions of the Grantee’s employment with the Company.

10.9    Amendment. The Committee has the right to amend, alter, suspend, discontinue or cancel the Restricted Stock Units, prospectively or retroactively; provided, that, no such amendment shall adversely affect the Grantee’s material rights under this Agreement without the Grantee’s consent.

10.10    Section 409A. This Agreement is intended to comply with Section 409A of the Code or an exemption thereunder and shall be construed and interpreted in a manner that is consistent with the requirements for avoiding additional taxes or penalties under Section 409A of the Code. Notwithstanding the foregoing, the Company makes no representations that the payments and benefits provided under this Agreement comply with Section 409A of the Code and in no event shall the Company be liable for all or any portion of any taxes, penalties, interest or other expenses that may be incurred by the Grantee on account of non-compliance with Section 409A of the Code.

10.11    No Impact on Other Benefits. The value of the Grantee’s Restricted Stock Units is not part of his or her normal or expected compensation for purposes of calculating any severance, retirement, welfare, insurance or similar employee benefit, except to the extent required under the terms of any qualified pension plan.

10.12    Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original but all of which together will constitute one and the same instrument. Counterpart signature pages to this Agreement transmitted by facsimile transmission, by electronic mail in portable document format (.pdf), or by any other electronic means intended to

5

preserve the original graphic and pictorial appearance of a document, will have the same effect as physical delivery of the paper document bearing an original signature.

10.13    Acceptance. The Grantee hereby acknowledges receipt of a copy of the Plan and this Agreement. The Grantee has read and understands the terms and provisions thereof, and accepts the Restricted Stock Units subject to all of the terms and conditions of the Plan and this Agreement. The Grantee acknowledges that there may be adverse tax consequences upon the vesting or settlement of the Restricted Stock Units or disposition of the underlying shares and that the Grantee has been advised to consult a tax advisor prior to such vesting, settlement or disposition.

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written.

Westmoreland Coal Company

By: _____________________

Name:

Title:

[EMPLOYEE NAME]

By: _____________________

Name:

7

EX-10.3

Exhibit 10.3

Westmoreland Coal Company

2014 Equity Incentive Plan

Performance Vested Restricted Stock Unit Agreement

This Restricted Stock Unit Agreement (this “Agreement”) is made and entered into as of [DATE] (the “Grant Date”) by and between Westmoreland Coal Company, a Delaware corporation (the “Company”) and ________________________________ (the “Grantee”).

WHEREAS, the Company has adopted the 2014 Equity Incentive Plan (the “Plan”) pursuant to which awards of Restricted Stock Units may be granted; and

WHEREAS, the Committee has determined that it is in the best interests of the Company and its shareholders to grant the award of Restricted Stock Units provided for herein.

NOW, THEREFORE, the parties hereto, intending to be legally bound, agree as follows:

SECTION 1. GRANT OF RESTRICTED STOCK UNITS.

1.1     Pursuant to the Plan, the Company hereby issues to the Grantee on the Grant Date an Award for a target number of __________ [NUMBER] Restricted Stock Units (the “Restricted Stock Units” or “RSUs”). Each Restricted Stock Unit represents the right to receive one share of Common Stock, subject to the terms and conditions set forth in this Agreement and the Plan. The number of Restricted Stock Units that the Grantee actually earns for the Performance Period (up to a maximum number of __________ [NUMBER]) will be determined by the level of achievement of the Performance Goals described on Exhibit A to this Agreement (the “Performance Goals”). Capitalized terms that are used but not defined herein have the meaning ascribed to them in the Plan.

1.1    The Restricted Stock Units shall be credited to a separate account maintained for the Grantee on the books and records of the Company (the “Account”). All amounts credited to the Account shall continue for all purposes to be part of the general assets of the Company.

SECTION 2. PERFORMANCE PERIOD.

2.1    For purposes of this Agreement, the term “Performance Period” shall be the period commencing on [DATE] and ending on [DATE].

SECTION 3. PERFORMANCE GOALS.

3.1    The number of RSUs earned by the Grantee for the Performance Period will be determined at the end of the Performance Period based on the level of achievement of the Performance Goals. All determinations of whether Performance Goals have been achieved, the number of RSUs earned by the Grantee, and all other matters related to this Award shall be made by the Committee in its sole discretion.

3.2    Promptly following completion of the Performance Period (and no later than [thirty (30) days/[ALTERNATIVE PERIOD]] following the end of the Performance Period), the

Employee / Stock Settled / Performance Vested

Committee will review and certify in writing (a) whether, and to what extent, the Performance Goals have been achieved, and (b) the number of RSUs that the Grantee shall earn, if any, subject to compliance with the requirements of Section 5. Such certification shall be final, conclusive and binding on the Grantee, and on all other persons, to the maximum extent permitted by law. [Not necessary except for 162(m) performance based compensation]

SECTION 4. CONSIDERATION.

The grant of the Restricted Stock Units is made in consideration of the services to be rendered by the Grantee to the Company.

SECTION 5. VESTING.

5.1    Except as otherwise provided herein, the RSUs are subject to forfeiture until they vest. The RSUs will vest and become nonforfeitable on the last day of the Performance Period, to the extent that the Performance Goals are determined by the Committee to have been achieved, and provided that the Grantee remains in Continuous Service through such date. The number of RSUs that vest will be rounded to the nearest whole number [round down / round up].

5.2    The foregoing paragraph notwithstanding, if the Grantee’s Continuous Service terminates as a result of the Grantee’s [death,] [Disability,] [a termination by the Company or an Affiliate without Cause] [or] [a termination by the Grantee for Good Reason], the Grantee will vest on such date in a pro rata portion of the Target Award calculated by multiplying the Target Award by a fraction, the numerator of which equals the number of days that the Grantee was employed during the Performance Period and the denominator of which equals the total number of days in the Performance Period.

5.3    The foregoing vesting schedule notwithstanding, if a Change in Control occurs and the Grantee’s Continuous Service is terminated by the Company or an Affiliate without Cause or by the Grantee for Good Reason, and the Grantee’s date of termination occurs (or in the case of the Grantee’s termination of Continuous Service for Good Reason, the event giving rise to Good Reason occurs) within [twelve (12) months/[ALTERNATIVE PERIOD]] following the Change in Control, the Grantee will vest on the date of termination in a pro rata portion of the Target Award calculated by multiplying the Target Award by a fraction, the numerator of which equals the number of days that the Grantee was employed during the Performance Period and the denominator of which equals the total number of days in the Performance Period.

SECTION 6. RESTRICTIONS.

Subject to any exceptions set forth in this Agreement or the Plan, during the Restricted Period and until such time as the Restricted Stock Units are settled in accordance with Section 6, the Restricted Stock Units or the rights relating thereto may not be assigned, alienated, pledged, attached, sold or otherwise transferred or encumbered by the Grantee. Any attempt to assign, alienate, pledge, attach, sell or otherwise transfer or encumber the Restricted Stock Units or the rights relating thereto shall be wholly ineffective and, if any such attempt is made, the Restricted Stock Units will be forfeited by the Grantee and all of the Grantee’s rights to such units shall immediately terminate without any payment or consideration by the Company.

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SECTION 7. RIGHTS AS SHAREHOLDER; DIVIDEND EQUIVALENTS.

7.1    The Grantee shall not have any rights of a shareholder with respect to the shares of Common Stock underlying the Restricted Stock Units unless and until the Restricted Stock Units vest and are settled by the issuance of such shares of Common Stock.

7.2    Upon and following the settlement of the Restricted Stock Units, the Grantee shall be the record owner of the shares of Common Stock underlying the Restricted Stock Units unless and until such shares are sold or otherwise disposed of, and as record owner shall be entitled to all rights of a shareholder of the Company (including voting rights).

7.3    [Until such time as the Restricted Stock Units vest, the Grantee’s Account shall be credited with an amount equal to all cash [and stock] dividends (“Dividend Equivalents”) that would have been paid to the Grantee if one share of Common Stock had been issued on the Grant Date for each Restricted Stock Unit granted to the Grantee as set forth in this Agreement. [Dividend Equivalents shall be withheld by the Company for the Grantee’s Account and interest may be credited on the amount of cash Dividend Equivalents withheld at a rate and subject to such terms as determined by the Committee. Dividend Equivalents shall be subject to the same vesting restrictions as the Restricted Stock Units to which they are attributable and shall be paid on the same date that the Restricted Stock Units to which they are attributable are settled in accordance with Section 8 hereof/Dividend Equivalents shall be paid in the same year that dividends are paid to shareholders.] Dividend Equivalents credited to a Grantee’s Account shall be distributed in cash or, at the discretion of the Committee, in shares of Common Stock having a Fair Market Value equal to the amount of the Dividend Equivalents and interest, if any.]

SECTION 8. SETTLEMENT OF RESTRICTED STOCK UNITS.

8.1    Payment in respect of the RSUs earned for the Performance Period shall be made in shares of Common Stock and shall be issued to the Grantee as soon as practicable following the vesting date and in any event [within sixty (60) days/[ALTERNATIVE TIMEFRAME] following the vesting date. The Company shall (a) issue and deliver to the Grantee the number of shares of Common Stock equal to the number of vested RSUs, and (b) enter the Grantee’s name on the books of the Company as the shareholder of record with respect to the shares of Common Stock delivered to the Grantee. [Add discussion of dividend equivalents, if applicable.] [Revise if Company wants discretion to settle in cash, notwithstanding accounting consequences.]

8.2    [Notwithstanding the previous paragraph, in accordance with the Plan, the Committee may, but is not required to, prescribe rules pursuant to which the Grantee may elect to defer settlement of the Restricted Stock Units. Any deferral election must be made in compliance with such rules and procedures as the Committee deems advisable.]

8.3    [If the Grantee is deemed a “specified employee” within the meaning of Section 409A of the Code, as determined by the Committee, at a time when the Grantee becomes eligible for settlement of the RSUs upon his “separation from service” within the meaning of Section 409A of the Code, then to the extent necessary to prevent any accelerated or additional tax under Section 409A of the Code, such settlement will be delayed until the earlier of: (a) the date that is six months following the Grantee’s separation from service and (b) the Grantee’s death.]

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SECTION 9. NO RIGHT TO CONTINUED SERVICE.

Neither the Plan nor this Agreement shall confer upon the Grantee any right to be retained in any position, as an Employee or Director of the Company. Further, nothing in the Plan or this Agreement shall be construed to limit the discretion of the Company to terminate the Grantee’s Continuous Service at any time, with or without Cause.

SECTION 10. ADJUSTMENTS.

If any change is made to the outstanding Common Stock or the capital structure of the Company, if required, the Restricted Stock Units shall be adjusted or terminated in any manner as contemplated by of the Plan.

SECTION 11. TAX LIABILITY AND WITHHOLDING.

11.1    The Grantee shall be required to pay to the Company, and the Company shall have the right to deduct from any compensation paid to the Grantee pursuant to the Plan, the amount of any required withholding taxes in respect of the Restricted Stock Units and to take all such other action as the Committee deems necessary to satisfy all obligations for the payment of such withholding taxes. The Committee may permit the Grantee to satisfy any federal, state or local tax withholding obligation by any of the following means, or by a combination of such means:

a. tendering a cash payment.

b. authorizing the Company to withhold shares of Common Stock from the shares of Common Stock otherwise issuable or deliverable to the Grantee as a result of the vesting of the Restricted Stock Units; provided, however, that no shares of Common Stock shall be withheld with a value exceeding the minimum amount of tax required to be withheld by law.

c. delivering to the Company previously owned and unencumbered shares of Common Stock.

11.2    Notwithstanding any action the Company takes with respect to any or all income tax, social insurance, payroll tax, or other tax-related withholding (“Tax-Related Items”), the ultimate liability for all Tax-Related Items is and remains the Grantee’s responsibility and the Company (a) makes no representation or undertakings regarding the treatment of any Tax-Related Items in connection with the grant, vesting or settlement of the Restricted Stock Units or the subsequent sale of any shares; and (b) does not commit to structure the Restricted Stock Units to reduce or eliminate the Grantee’s liability for Tax-Related Items.

SECTION 12. MISCELLANEOUS PROVISIONS

12.1    Compliance with Law. The issuance and transfer of shares of Common Stock shall be subject to compliance by the Company and the Grantee with all applicable requirements of federal and state securities laws and with all applicable requirements of any stock exchange on which the Company’s shares of Common Stock may be listed. No shares of Common Stock shall

4

be issued or transferred unless and until any then applicable requirements of state and federal laws and regulatory agencies have been fully complied with to the satisfaction of the Company and its counsel.

12.2    Notices. Any notice required to be delivered to the Company under this Agreement shall be in writing and addressed to the [Secretary/[OTHER POSITION]] of the Company at the Company’s principal corporate offices. Any notice required to be delivered to the Grantee under this Agreement shall be in writing and addressed to the Grantee at the Grantee’s address as shown in the records of the Company. Either party may designate another address in writing (or by such other method approved by the Company) from time to time.

12.3    Governing Law. This Agreement will be construed and interpreted in accordance with the laws of the State of Delaware without regard to conflict of law principles.

12.4    Interpretation. Any dispute regarding the interpretation of this Agreement shall be submitted by the Grantee or the Company to the Committee for review. The resolution of such dispute by the Committee shall be final and binding on the Grantee and the Company.

12.5    Restricted Stock Units Subject to Plan. This Agreement is subject to the Plan as approved by the Company’s shareholders. The terms and provisions of the Plan as it may be amended from time to time are hereby incorporated herein by reference. In the event of a conflict between any term or provision contained herein and a term or provision of the Plan, the applicable terms and provisions of the Plan will govern and prevail.

12.6    Successors and Assigns. The Company may assign any of its rights under this Agreement. This Agreement will be binding upon and inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer set forth herein, this Agreement will be binding upon the Grantee and the Grantee’s beneficiaries, executors, administrators and the person(s) to whom the Restricted Stock Units may be transferred by will or the laws of descent or distribution.

12.7    Severability. The invalidity or unenforceability of any provision of the Plan or this Agreement shall not affect the validity or enforceability of any other provision of the Plan or this Agreement, and each provision of the Plan and this Agreement shall be severable and enforceable to the extent permitted by law.

12.8    Discretionary Nature of Plan. The Plan is discretionary and may be amended, cancelled or terminated by the Company at any time, in its discretion. The grant of the Restricted Stock Units in this Agreement does not create any contractual right or other right to receive any Restricted Stock Units or other Awards in the future. Future Awards, if any, will be at the sole discretion of the Company. Any amendment, modification, or termination of the Plan shall not constitute a change or impairment of the terms and conditions of the Grantee’s employment with the Company.

12.9    Amendment. The Committee has the right to amend, alter, suspend, discontinue or cancel the Restricted Stock Units, prospectively or retroactively; provided, that, no such amendment shall adversely affect the Grantee’s material rights under this Agreement without the Grantee’s consent.

5

12.10    [Section 162(m). All payments under this Agreement are intended to constitute “qualified performance-based compensation” within the meaning of Section 162(m) of the Code. This Award shall be construed and administered in a manner consistent with such intent.]

12.11    Section 409A. This Agreement is intended to comply with Section 409A of the Code or an exemption thereunder and shall be construed and interpreted in a manner that is consistent with the requirements for avoiding additional taxes or penalties under Section 409A of the Code. Notwithstanding the foregoing, the Company makes no representations that the payments and benefits provided under this Agreement comply with Section 409A of the Code and in no event shall the Company be liable for all or any portion of any taxes, penalties, interest or other expenses that may be incurred by the Grantee on account of non-compliance with Section 409A of the Code.

12.12    No Impact on Other Benefits. The value of the Grantee’s Restricted Stock Units is not part of his or her normal or expected compensation for purposes of calculating any severance, retirement, welfare, insurance or similar employee benefit, except to the extent required under the terms of any qualified pension plan.

12.13    Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original but all of which together will constitute one and the same instrument. Counterpart signature pages to this Agreement transmitted by facsimile transmission, by electronic mail in portable document format (.pdf), or by any other electronic means intended to preserve the original graphic and pictorial appearance of a document, will have the same effect as physical delivery of the paper document bearing an original signature.

12.14    Acceptance. The Grantee hereby acknowledges receipt of a copy of the Plan and this Agreement. The Grantee has read and understands the terms and provisions thereof, and accepts the Restricted Stock Units subject to all of the terms and conditions of the Plan and this Agreement. The Grantee acknowledges that there may be adverse tax consequences upon the vesting or settlement of the Restricted Stock Units or disposition of the underlying shares and that the Grantee has been advised to consult a tax advisor prior to such vesting, settlement or disposition.

6

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written.

Westmoreland Coal Company

By: _____________________

Name:

Title:

[EMPLOYEE NAME]

By: _____________________

Name:

7

EX-31.1

Exhibit 31.1

Certification

I, Keith E. Alessi, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Westmoreland Coal Company;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	July 31, 2014	/s/ Keith E. Alessi
		Name: Keith E. Alessi
		Title:   Chief Executive Officer
		(Principal Executive Officer)

EX-31.2

Exhibit 31.2

Certification

I, Kevin A. Paprzycki, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Westmoreland Coal Company;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	July 31, 2014	/s/ Kevin A. Paprzycki
		Name: Kevin A. Paprzycki
		Title:   Chief Financial Officer and Treasurer
		(Principal Financial Officer)

EX-32

Exhibit 32

Statement Pursuant to 18 U.S.C. § 1350

Pursuant to 18 U.S.C. § 1350, each of the undersigned certifies that this Quarterly Report on Form 10-Q for the period ended June 30, 2014, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that the information contained in this report fairly presents, in all material respects, the financial condition and results of operations of Westmoreland Coal Company.

Date:	July 31, 2014	/s/ Keith E. Alessi
		Name: Keith E. Alessi
		Chief Executive Officer
		(Principal Executive Officer)

Date:	July 31, 2014	/s/ Kevin A. Paprzycki
		Name: Kevin A. Paprzycki
		Chief Financial Officer and Treasurer
		(Principal Financial Officer)

A signed original of this written statement required by Section 906 has been provided to Westmoreland Coal Company and will be retained by Westmoreland Coal Company and furnished to the Securities and Exchange Commission or its staff upon request.

EX-95.1

EXHIBIT 95.1

Uncompromised Safety

Uncompromised safety is a core value of Westmoreland Coal Company. We use a grass roots approach, encouraging and promoting involvement with input from all employees and contractors. We feel employee and contractor involvement is a pillar of our safety excellence. We stress that all employees and contractors are responsible for safety, their personal safety as well as the safety of their co-workers. We have in place comprehensive safety programs, extensive safety and skills training, regular safety audits and inspections, mine rescue training, and supervisory leadership training. Recording, reporting, and investigation protocols are in place for all accidents, incidents, losses and near misses to avoid reoccurrence and eliminate potential hazards. We couple all these measures with total vigilance in following regulatory standards, which is the backbone of our strong safety culture enjoyed by our employees, contractors, vendors, and all visiting our operations. Our mines are also regularly inspected by the Mine Safety and Health Administration (“MSHA”) as well as by state mine inspectors. Collectively, federal and state safety and health regulations in the coal mining industry are perhaps the most comprehensive and stringent systems for the protection of employee health and safety affecting any segment of the U.S. economy.

Westmoreland U.S. mines had reportable and lost time incident rates for the year to date through the second quarter of 2014 of 1.09 and 0.68 versus the national surface mine rates of 1.67 and 1.15, respectively. Westmoreland Canadian mines had recordable and lost time incident rates for the period April 28, 2014 through the second quarter of 2014 of 2.84 and 0.41.

Federal Mine Safety and Health Act Information

Section 1503 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) requires issuers to include in periodic reports filed with the Securities and Exchange Commission (“SEC”) certain information relating to citations or orders for violations of standards under the Federal Mine Safety and Health Act of 1977 (the “Mine Act”).  The following disclosures respond to that legislation and are presented in accordance with the SEC's final rules promulgated under Section 1503 of the Dodd-Frank Act.  These disclosures reflect United States (U.S.) mining operations only, as these requirements do not apply to our mines operated outside the U.S.

Whenever the Mine Safety and Health Administration (“MSHA”) believes that a violation of the Mine Act, any health or safety standard, or any regulation has occurred, it may issue a citation that describes the violation and fixes a time within which the operator must abate the violation.  In these situations, MSHA typically proposes a civil penalty, or fine, as a result of the violation, that the operator is ordered to pay.  In evaluating the below information regarding mine safety and health, investors should take into account factors such as: (a) the number of citations and orders will vary depending on the size of a coal mine, (b) the number of citations issued will vary from inspector to inspector and mine to mine, and (c) citations and orders can be contested and appealed, and during that process are often reduced in severity and amount, and are sometimes dismissed.  Because MSHA is a branch of the U.S. Department of Labor, its jurisdiction applies only to our U.S. mines and, as such, the mine safety disclosures that follow contain no information for our Canadian mines.

Westmoreland Coal Company
10-Q Safety Statistics
Quarter Ending June 30, 2014
									Received	Received
								Total	Notice of	Notice of	Legal
			Section			Total Dollar		Number	Pattern of	Potential	Actions	Legal	Legal
Mine or			104(d)			Value of		of	Violations	to Have	Pending	Actions	Actions
Operating	Section	Section	Citations	Section	Section	MSHA		Mining	Under	Pattern	as of	Initiated	Resolved
Name/MSHA	104 S&S	104(b)	and	110(b)(2)	107(a)	Assessments		Related	Section	Under	Last Day	During	During
Identification	Citations	Orders	Orders	Violations	Orders	Proposed		Fatalities	(yes/no)	(yes/no)	of Period	Period	Period
Number	(#)(1)	(#)(2)	(#)(3)	(#)(4)	(#)(5)	(#)(6)		(#)(7)	(#)(8)	(#)(8)	(#)(9)	(#)(9)	(#)(9)
Rosebud Mine & Crusher Conveyor
24-01747	1	—	—	—	—	$	807	—	No	No	10	—	—
Absaloka Mine
24-00910	—	—	—	—	—	$	3,787	—	No	No	—	—	—
Savage Mine
24-00106	—	—	—	—	—	$	—	—	No	No	—	—	—
Jewett Mine
41-03164	1	—	—	—	—	$	—	—	No	No	1	—	—
Beulah Mine
32-00043	—	—	—	—	—	$	378	—	No	No	—	—	—
Kemmerer Mine
48-00086	1	1	—	—	—	$	5,342	—	No	No	2	—	3

(1) Mine Act Section 104(a) citations are for alleged violations of mandatory health or safety standards that could significantly and substantially contribute to the cause and effect of a coal mine safety or health hazard.

(2) Mine Act Section 104(b) orders are for alleged failures to totally abate a citation within the period of time specified in the citation.

(3) Mine Act Section 104(d) citations and orders are for an alleged unwarrantable failure to comply with mandatory health or safety standards.

(4) Total number of flagrant violations issued under Section 110(b)(2) of the Mine Act.

(5) Mine Act Section 107(a) orders are for alleged conditions or practices that could reasonably be expected to cause death or serious physical harm before such condition or practice can be abated and result in orders of immediate withdrawal from the area of the mine affected by the condition.

(6) Total dollar value of MSHA assessments proposed during the quarter ended June 30, 2014.

(7) Total number of mining-related fatalities during the quarter ended June 30, 2014.

(8) Mine Act Section 104(e) written notices are for an alleged pattern of violations of mandatory health or safety standards that are of such nature as could have significantly and substantially contributed to the cause and effect of a coal mine health or safety hazard, or the potential to have such a pattern.

(9) Any pending legal action before the Federal Mine Safety and Health Review Commission (the “Commission”) involving a coal mine owned and operated by us.  The number of legal actions pending as of June 30, 2014 that fall into each of the following categories is as follows:

(a)  Contests of citations and orders: 2

(b)  Contests of proposed penalties: 11

XML

SUPPLEMENTAL CONSOLIDATING FINANCIAL INFORMATION (Tables)

6 Months Ended

Jun. 30, 2014

Condensed Financial Information of Parent Company Only Disclosure [Abstract]

Supplemental Consolidating Balance Sheet Information

CONSOLIDATING BALANCE SHEETS

June 30, 2014

(In thousands)

Assets	Parent/ Issuer		Co-Issuer		Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Consolidating Adjustments			Total
Current assets:
Cash and cash equivalents	$	13,514	$	415	$	24,440		$	2,241		$	—		$	40,610
Receivables:
Trade	—		12,940		116,712			—			—			129,652
Loan and lease receivable	—		—		11,682			—			—			11,682
Contractual third-party reclamation receivables	—		—		7,940			—			—			7,940
Intercompany receivable/payable	132,824		32,639		(146,187		)	(19,275		)	(1		)	—
Other	673		210		2,294			45			(40		)	3,182
	133,497		45,789		(7,559		)	(19,230		)	(41		)	152,456
Inventories	—		5,319		147,834			1			—			153,154
Deferred income taxes	5,370		—		683			—			—			6,053
Other current assets	972		335		11,055			—			—			12,362
Total current assets	153,353		51,858		176,453			(16,988		)	(41		)	364,635
Property, plant and equipment:
Land and mineral rights	—		1,395		437,606			—			—			439,001
Plant and equipment	4,022		221,350		606,965			—			—			832,337
	4,022		222,745		1,044,571			—			—			1,271,338
Less accumulated depreciation, depletion and amortization	2,863		76,662		406,295			—			—			485,820
Net property, plant and equipment	1,159		146,083		638,276			—			—			785,518
Loan and lease receivable	—		—		85,344			—			—			85,344
Advanced coal royalties	—		—		7,134			—			—			7,134
Reclamation deposits	—		—		75,911			—			—			75,911
Restricted investments and bond collateral	63,322		—		41,189			—			—			104,511
Contractual third-party reclamation receivables	—		—		93,956			—			—			93,956
Investment in joint venture	—		—		33,273			—			—			33,273
Intangible assets	—		460		217			—			—			677
Investment in subsidiaries	480,871		—		—			3,770			(484,641		)	—
Other assets	21,825		—		10,937			3,500			(3,500		)	32,762
Total assets	$	720,530	$	198,401	$	1,162,690		$	(9,718	)	$	(488,182	)	$	1,583,721

CONSOLIDATING BALANCE SHEETS

June 30, 2014

(In thousands)

Liabilities and Shareholders’ Deficit	Parent/ Issuer			Co-Issuer			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Consolidating Adjustments			Total
Current liabilities
Current installments of long-term debt	$	—		$	—		$	42,401		$	—		$	—		$	42,401
Accounts payable and accrued expenses:
Trade and other accrued liabilities	5,240			7,996			114,423			684			(5		)	128,338
Interest payable	30,315			—			474			—			(39		)	30,750
Production taxes	—			1,081			38,936			2,657			(1		)	42,673
Workers’ compensation	707			—			—			—			—			707
Postretirement medical benefits	12,042			—			773			1,139			1			13,955
SERP	390			—			—			—			—			390
Deferred revenue	—			9,581			1,980			—			—			11,561
Asset retirement obligations	—			—			31,131			—			—			31,131
Other current liabilities	593			5,279			6,102			—			(1		)	11,973
Total current liabilities	49,287			23,937			236,220			4,480			(45		)	313,879
Long-term debt, less current installments	698,015			—			96,128			—			(3,500		)	790,643
Workers’ compensation, less current portion	6,629			—			—			—			—			6,629
Excess of black lung benefit obligation over trust assets	9,841			—			—			—			—			9,841
Postretirement medical benefits, less current portion	184,902			—			68,766			18,105			—			271,773
Pension and SERP obligations, less current portion	12,776			97			9,110			239			—			22,222
Deferred revenue, less current portion	—			35,949			4,728			—			(1		)	40,676
Asset retirement obligations, less current portion	—			927			357,326			—			—			358,253
Intangible liabilities	—			5,072			—			—			—			5,072
Deferred income taxes	5,370			—			10,144			—			—			15,514
Other liabilities	707			5,790			3,167			200			—			9,864
Intercompany receivable/payable	13,648			—			(13,849		)	14,654			(14,453		)	—
Total liabilities	981,175			71,772			771,740			37,678			(17,999		)	1,844,366
Shareholders’ deficit
Preferred stock	96			—			—			—			—			96
Common stock	38,173			5			110			132			(247		)	38,173
Other paid-in capital	133,140			52,848			441,269			(124		)	(493,993		)	133,140
Accumulated other comprehensive loss	(53,615		)	(160		)	16,075			(3,067		)	(12,848		)	(53,615		)
Accumulated earnings (deficit)	(378,439		)	73,936			(66,504		)	(44,337		)	36,905			(378,439		)
Total equity (deficit)	(260,645		)	126,629			390,950			(47,396		)	(470,183		)	(260,645		)
Total liabilities and shareholders’ deficit	$	720,530		$	198,401		$	1,162,690		$	(9,718	)	$	(488,182	)	$	1,583,721

CONSOLIDATING BALANCE SHEETS

December 31, 2013

(In thousands)

Assets	Parent/ Issuer			Co-Issuer		Guarantor Subsidiaries		Non- Guarantor Subsidiaries			Consolidating Adjustments			Total
Current assets:
Cash and cash equivalents	$	25,326		$	3,341	$	27,451	$	4,992		$	—		$	61,110
Receivables:
Trade	—			12,934		46,985		6,277			—			66,196
Contractual third-party reclamation receivables	—			—		8,487		—			—			8,487
Intercompany receivable/payable	(16,273		)	—		2,761		(19,353		)	32,865			—
Other	1,616			210		3,256		28			(24		)	5,086
	(14,657		)	13,144		61,489		(13,048		)	32,841			79,769
Inventories	—			6,161		33,811		—			—			39,972
Deferred income taxes	5,355			—		870		—			(870		)	5,355
Restricted investments and bond collateral	—			5,998		—		—			—			5,998
Other current assets	789			143		11,069		834			—			12,835
Total current assets	16,813			28,787		134,690		(7,222		)	31,971			205,039
Property, plant and equipment:
Land and mineral rights	—			1,395		276,793		—			—			278,188
Plant and equipment	3,973			220,872		432,851		—			—			657,696
	3,973			222,267		709,644		—			—			935,884
Less accumulated depreciation, depletion and amortization	2,707			71,653		371,488		—			—			445,848
Net property, plant and equipment	1,266			150,614		338,156		—			—			490,036
Advanced coal royalties	—			—		7,311		—			—			7,311
Reclamation deposits	—			—		74,921		—			—			74,921
Restricted investments and bond collateral	15,134			—		54,101		—			—			69,235
Contractual third-party reclamation receivables	—			—		88,303		—			—			88,303
Intangible assets	—			1,283		237		—			—			1,520
Investment in subsidiaries	280,843			—		—		3,770			(284,613		)	—
Other assets	8,636			—		1,683		2,000			(1,999		)	10,320
Total assets	$	322,692		$	180,684	$	699,402	$	(1,452	)	$	(254,641	)	$	946,685

CONSOLIDATING BALANCE SHEETS

December 31, 2013

(In thousands)

Liabilities and Shareholders’ Deficit	Parent/ Issuer			Co-Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Current liabilities
Current installments of long-term debt	$	20,392		$	—		$	23,951		$	—		$	—		$	44,343
Accounts payable and accrued expenses:
Trade	6,840			10,119			38,061			2,487			—			57,507
Interest payable	11,302			—			40			—			(21		)	11,321
Production taxes	—			3			36,522			5,380			—			41,905
Workers’ compensation	717			—			—			—			—			717
Postretirement medical benefits	12,042			—			774			1,139			—			13,955
SERP	390			—			—			—			—			390
Deferred revenue	—			9,024			5,044			—			—			14,068
Asset retirement obligations	—			—			23,353			—			—			23,353
Other current liabilities	—			5,053			417			—			(1		)	5,469
Total current liabilities	51,683			24,199			128,162			9,006			(22		)	213,028
Long-term debt, less current installments	224,582			—			72,912			—			(2,000		)	295,494
Workers’ compensation, less current portion	6,744			—			—			—			—			6,744
Excess of black lung benefit obligation over trust assets	8,675			—			—			—			—			8,675
Postretirement medical benefits, less current portion	185,858			—			66,439			18,077			—			270,374
Pension and SERP obligations, less current portion	13,069			99			10,765			243			—			24,176
Deferred revenue, less current portion	—			41,297			5,270			—			—			46,567
Asset retirement obligations, less current portion	—			892			255,619			—			—			256,511
Intangible liabilities	—			5,606			—			—			—			5,606
Deferred income taxes	5,355			—			—			—			—			5,355
Other liabilities	584			—			6,687			983			(6,220		)	2,034
Intercompany receivable/payable	14,021			—			(7,851		)	14,654			(20,824		)	—
Total liabilities	510,571			72,093			538,003			42,963			(29,066		)	1,134,564
Shareholders’ deficit
Preferred stock	160			—			—			—			—			160
Common stock	36,479			5			110			132			(247		)	36,479
Other paid-in capital	134,861			52,835			157,984			(124		)	(210,695		)	134,861
Accumulated other comprehensive loss	(63,595		)	(164		)	6,425			(3,086		)	(3,175		)	(63,595		)
Accumulated earnings (deficit)	(295,784		)	55,915			(3,120		)	(41,337		)	(11,458		)	(295,784		)
Total equity (deficit)	(187,879		)	108,591			161,399			(44,415		)	(225,575		)	(187,879		)
Total liabilities and shareholders’ deficit	$	322,692		$	180,684		$	699,402		$	(1,452	)	$	(254,641	)	$	946,685

Supplemental Consolidating Statement of Operations Information

CONSOLIDATING STATEMENTS OF OPERATIONS

Three Months Ended June 30, 2014

(In thousands)

	Parent/ Issuer			Co-Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments		Total
Revenues	$	—		$	21,803		$	266,153		$	—		$	—	$	287,956
Costs and expenses:
Cost of sales	(247		)	21,592			227,044			—			—		248,389
Depreciation, depletion and amortization	79			2,485			21,915			—			—		24,479
Selling and administrative	12,003			1,169			15,921			(384		)	—		28,709
Heritage health benefit expenses	3,178			—			—			210			—		3,388
Gain on sales of assets	—			—			(43		)	—			—		(43		)
Restructuring charges	796			101			6,646			—			—		7,543
Derivative loss	—			5,930			—			—			—		5,930
Income from equity affiliates	—			—			(799		)	—			—		(799		)
	15,809			31,277			270,684			(174		)	—		317,596
Operating income (loss)	(15,809		)	(9,474		)	(4,531		)	174			—		(29,640		)
Other income (expense):
Interest expense	(18,609		)	(74		)	(3,111		)	(1		)	9		(21,786		)
Loss on extinguishment of debt	(63		)	—			(12,571		)	(1		)	—		(12,635		)
Interest income	145			4			1,433			—			—		1,582
Gain on foreign exchange	1,557			—			1,092			—			—		2,649
Other income	—			—			483			—			—		483
	(16,970		)	(70		)	(12,674		)	(2		)	9		(29,707		)
Income (loss) before income taxes and income of consolidated subsidiaries	(32,779		)	(9,544		)	(17,205		)	172			9		(59,347		)
Equity in income of subsidiaries	(30,462		)	—			—			—			30,462		—
Income (loss) before income taxes	(63,241		)	(9,544		)	(17,205		)	172			30,471		(59,347		)
Income tax expense (benefit)	(87		)	—			(74		)	1			3,967		3,807
Net income (loss)	(63,154		)	(9,544		)	(17,131		)	171			26,504		(63,154		)
Less net loss attributable to noncontrolling interest	—			—			—			—			—		—
Net income (loss) attributable to the Parent company	$	(63,154	)	$	(9,544	)	$	(17,131	)	$	171		$	26,504	$	(63,154	)

CONSOLIDATING STATEMENTS OF OPERATIONS

Three Months Ended June 30, 2013

(In thousands)

	Parent/ Issuer			Co-Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Revenues	$	—		$	23,162		$	134,449		$	9,538		$	(4,650	)	$	162,499
Costs and expenses:
Cost of sales	(372		)	14,901			113,640			7,009			(4,650		)	130,528
Depreciation, depletion and amortization	94			2,551			12,753			—			(1		)	15,397
Selling and administrative	4,259			872			7,232			(394		)	—			11,969
Heritage health benefit expenses	2,844			—			—			265			—			3,109
Gain on sales of assets	—			—			(74		)	—			—			(74		)
Other operating income	—			—			(10,405		)	—			—			(10,405		)
	6,825			18,324			123,146			6,880			(4,651		)	150,524
Operating income (loss)	(6,825		)	4,838			11,303			2,658			1			11,975
Other income (expense):
Interest expense	(7,591		)	(10		)	(2,479		)	(5		)	9			(10,076		)
Loss on extinguishment of debt	(64		)	—			—			—			—			(64		)
Interest income	46			5			232			6			(9		)	280
Other income (loss)	2			—			130			(2		)	—			130
	(7,607		)	(5		)	(2,117		)	(1		)	—			(9,730		)
Income (loss) before income taxes and income of consolidated subsidiaries	(14,432		)	4,833			9,186			2,657			1			2,245
Equity in income of subsidiaries	16,648			—			—			—			(16,648		)	—
Income (loss) before income taxes	2,216			4,833			9,186			2,657			(16,647		)	2,245
Income tax expense (benefit)	(1		)	—			1,139			—			(1,110		)	28
Net income (loss)	2,217			4,833			8,047			2,657			(15,537		)	2,217
Less net loss attributable to noncontrolling interest	2,499			—			—			—			—			2,499
Net income (loss) attributable to the Parent company	$	(282	)	$	4,833		$	8,047		$	2,657		$	(15,537	)	$	(282	)

CONSOLIDATING STATEMENTS OF OPERATIONS

Six Months Ended June 30, 2014

(In thousands)

	Parent/ Issuer			Co-Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Revenues	$	—		$	43,815		$	424,351		$	(7	)	$	—		$	468,159
Costs and expenses:
Cost of sales	(471		)	38,046			349,389			55			—			387,019
Depreciation, depletion and amortization	156			5,009			35,373			—			—			40,538
Selling and administrative	16,968			2,062			23,783			(773		)	—			42,040
Heritage health benefit expenses	6,504			—			—			428			—			6,932
Gain on sales of assets	—			—			(5		)	—			—			(5		)
Restructuring charges	796			499			6,646			—			—			7,941
Derivative loss	—			5,930			—			—			—			5,930
Equity in net income of unconsolidated affiliates	—			—			(799		)	—			—			(799		)
Other operating income	—			—			150			1			—			151
	23,953			51,546			414,537			(289		)	—			489,747
Operating income (loss)	(23,953		)	(7,731		)	9,814			282			—			(21,588		)
Other income (expense):
Interest expense	(37,282		)	(118		)	(5,199		)	—			15			(42,584		)
Loss on extinguishment of debt	(62		)	—			(12,572		)	(1		)	—			(12,635		)
Interest income	269			7			1,608			15			(15		)	1,884
Gain (loss) on foreign exchange	(5,233		)	—			1,092			—			—			(4,141		)
Other income	—			—			576			—			—			576
	(42,308		)	(111		)	(14,495		)	14			—			(56,900		)
Income (loss) before income taxes and income of consolidated subsidiaries	(66,261		)	(7,842		)	(4,681		)	296			—			(78,488		)
Equity in income of subsidiaries	(16,148		)	—			—			—			16,148			—
Income (loss) before income taxes	(82,409		)	(7,842		)	(4,681		)	296			16,148			(78,488		)
Income tax expense (benefit)	(224		)	—			5,041			—			(1,120		)	3,697
Net income (loss)	(82,185		)	(7,842		)	(9,722		)	296			17,268			(82,185		)
Less net loss attributable to noncontrolling interest	—			—			—			—			—			—
Net income (loss) attributable to the Parent company	$	(82,185	)	$	(7,842	)	$	(9,722	)	$	296		$	17,268		$	(82,185	)

CONSOLIDATING STATEMENTS OF OPERATIONS

Six Months Ended June 30, 2013

(In thousands)

	Parent/ Issuer			Co-Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Revenues	$	—		$	42,498		$	274,187		$	20,889		$	(13,627	)	$	323,947
Costs and expenses:
Cost of sales	(770		)	31,856			223,417			20,073			(13,627		)	260,949
Depreciation, depletion and amortization	187			5,082			24,554			—			—			29,823
Selling and administrative	8,207			1,726			14,680			(758		)	—			23,855
Heritage health benefit expenses	6,533			—			—			527			—			7,060
Gain on sales of assets	—			—			(308		)	—			—			(308		)
Other operating income	—			—			(15,142		)	—			—			(15,142		)
	14,157			38,664			247,201			19,842			(13,627		)	306,237
Operating income (loss)	(14,157		)	3,834			26,986			1,047			—			17,710
Other income (expense):
Interest expense	(15,175		)	(20		)	(5,048		)	(10		)	17			(20,236		)
Loss on extinguishment of debt	(64		)	—			—			—			—			(64		)
Interest income	76			15			493			10			(17		)	577
Other income (loss)	—			—			200			(2		)	—			198
	(15,163		)	(5		)	(4,355		)	(2		)	—			(19,525		)
Income (loss) before income taxes and income of consolidated subsidiaries	(29,320		)	3,829			22,631			1,045			—			(1,815		)
Equity in income of subsidiaries	27,450			—			—			—			(27,450		)	—
Income (loss) before income taxes	(1,870		)	3,829			22,631			1,045			(27,450		)	(1,815		)
Income tax expense (benefit)	—			—			4,458			—			(4,403		)	55
Net income (loss)	(1,870		)	3,829			18,173			1,045			(23,047		)	(1,870		)
Less net loss attributable to noncontrolling interest	797			—			—			—			—			797
Net income (loss) attributable to the Parent company	$	(2,667	)	$	3,829		$	18,173		$	1,045		$	(23,047	)	$	(2,667	)

Supplemental Consolidating Statements of Comprehensive Income (Loss)

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

Three Months Ended June 30, 2014

(In thousands)

	Parent/Issuer			Co-Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Consolidating Adjustments			Total
Net income (loss)	$	(63,154	)	$	(9,544	)	$	(17,131	)	$	171	$	26,504		$	(63,154	)
Other comprehensive income (loss)
Amortization of accumulated actuarial gains or losses, pension	359			2			122			6		(130		)	359
Amortization of accumulated actuarial gains or losses, transition obligations, and prior service costs, postretirement medical benefit	5			—			(36		)	5		31			5
Tax effect of other comprehensive income gains	64			—			—			—		—			64
Change in foreign currency translation adjustment	9,477			—			9,477			—		(9,477		)	9,477
Other comprehensive income (loss)	9,905			2			9,563			11		(9,576		)	9,905
Comprehensive income (loss) attributable to the Parent company	$	(53,249	)	$	(9,542	)	$	(7,568	)	$	182	$	16,928		$	(53,249	)

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

Three Months Ended June 30, 2013

(In thousands)

	Parent/Issuer			Co-Issuer		Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Consolidating Adjustments			Total
Net income (loss)	$	2,217		$	4,833	$	8,047		$	2,657	$	(15,537	)	$	2,217
Other comprehensive income (loss)
Amortization of accumulated actuarial gains or losses, pension	1,004			8		239			—		(247		)	1,004
Amortization of accumulated actuarial gains or losses, transition obligations, and prior service costs, postretirement medical benefit	1,001			—		214			—		(214		)	1,001
Unrealized and realized gains and losses on available-for-sale securities	(39		)	—		(40		)	—		40			(39		)
Other comprehensive income (loss)	1,966			8		413			—		(421		)	1,966
Comprehensive income (loss) attributable to the Parent company	$	4,183		$	4,841	$	8,460		$	2,657	$	(15,958	)	$	4,183

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

Six Months Ended June 30, 2014

(In thousands)

	Parent/Issuer			Co-Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Consolidating Adjustments			Total
Net income (loss)	$	(82,185	)	$	(7,842	)	$	(9,722	)	$	296	$	17,268		$	(82,185	)
Other comprehensive income (loss)
Amortization of accumulated actuarial gains or losses, pension	717			4			244			11		(259		)	717
Amortization of accumulated actuarial gains or losses, transition obligations, and prior service costs, postretirement medical benefit	10			—			(72		)	10		62			10
Tax effect of other comprehensive income gains	(224		)	—			—			—		—			(224		)
Change in foreign currency translation adjustment	9,477			—			9,477			—		(9,477		)	9,477
Other comprehensive income (loss)	9,980			4			9,649			21		(9,674		)	9,980
Comprehensive income (loss) attributable to the Parent company	$	(72,205	)	$	(7,838	)	$	(73	)	$	317	$	7,594		$	(72,205	)

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

Six Months Ended June 30, 2013

(In thousands)

	Parent/Issuer			Co-Issuer		Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Consolidating Adjustments			Total
Net income (loss)	$	(1,870	)	$	3,829	$	18,173		$	1,045	$	(23,047	)	$	(1,870	)
Other comprehensive income (loss)
Amortization of accumulated actuarial gains or losses, pension	1,745			14		432			—		(446		)	1,745
Amortization of accumulated actuarial gains or losses, transition obligations, and prior service costs, postretirement medical benefit	2,002			—		427			—		(427		)	2,002
Unrealized and realized gains and losses on available-for-sale securities	(39		)	—		(40		)	—		40			(39		)
Other comprehensive income (loss)	3,708			14		819			—		(833		)	3,708
Comprehensive income (loss) attributable to the Parent company	$	1,838		$	3,843	$	18,992		$	1,045	$	(23,880	)	$	1,838

Supplemental Consolidating Statement of Cash Flow Information

CONSOLIDATING STATEMENTS OF CASH FLOWS

Six Months Ended June 30, 2014

(In thousands)

Statements of Cash Flows	Parent/ Issuer			Co-Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Cash flows from operating activities:
Net income (loss)	$	(82,185	)	$	(7,842	)	$	(9,722	)	$	296		$	17,268		$	(82,185	)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Equity in income of subsidiaries	16,148			—			—			—			(16,148		)	—
Depreciation, depletion, and amortization	156			5,009			35,373			—			—			40,538
Accretion of asset retirement obligation and receivable	—			34			9,254			—			—			9,288
Non-cash tax benefits	(224		)	—			—			—			—			(224		)
Amortization of intangible assets and liabilities, net	—			290			20			—			—			310
Share-based compensation	1,934			14			497			—			—			2,445
Gain on sales of assets	—			—			(5		)	—			—			(5		)
Amortization of deferred financing costs	494			—			715			—			—			1,209
Loss on extinguishment of debt	62			—			12,572			1			—			12,635
Loss on sales of investment securities	—			—			3			—			—			3
Loss on derivative	—			5,930			—			—			—			5,930
Loss on foreign exchange	5,233			—			(1,092		)	—			—			4,141
Income from equity affiliates	—			—			(799		)	—			—			(799		)
Distributions from equity affiliates	—			—			730			—			—			730
Changes in operating assets and liabilities:
Receivables, net	943			(6		)	(18,474		)	4,733			1,534			(11,270		)
Inventories	—			842			21,929			(1		)	—			22,770
Excess of black lung benefit obligation over trust assets	1,166			—			—			—			—			1,166
Deferred income tax	—			—			3,854			—			—			3,854
Accounts payable and accrued expenses	17,348			(1,101		)	(3,164		)	(4,526		)	(19		)	8,538
Deferred revenue	—			(4,791		)	(3,633		)	—			—			(8,424		)
Income tax payable	—			—			528			—			—			528
Accrual for workers’ compensation	(125		)	—			—			—			—			(125		)
Asset retirement obligations	—			—			(3,364		)	2			—			(3,362		)
Accrual for postretirement medical benefits	(885		)	—			2,256			38			—			1,409
Pension and SERP obligations	166			2			(507		)	7			—			(332		)
Other assets and liabilities	(7,429		)	(273		)	4,113			(1,193		)	6,587			1,805
Distributions received from subsidiaries	76,800			—			—			—			(76,800		)	—

Net cash provided by (used in) operating activities	29,602			(1,892		)	51,084			(643		)	(67,578		)	10,573
Cash flows from investing activities:
Additions to property, plant and equipment	16			(255		)	(17,122		)	—			—			(17,361		)
Change in restricted investments and bond collateral and reclamation deposits	(48,188		)	5,998			11,673			—			—			(30,517		)
Cash payments related to Canadian acquisition	(282,788		)	—			(39,849		)	—			—			(322,637		)
Cash acquired related to Canadian acquisition	—			—			8,103			—			—			8,103
Net proceeds from sales of assets	—			—			213			—			—			213
Proceeds from the sale of investments	—			—			246			—			—			246
Increase in loan and lease receivable	—			—			(1,120		)	—			—			(1,120		)
Receipts from loan and lease receivable	—			—			2,164			—			—			2,164
Receivable from customer for property and equipment purchases	—			—			—			—			—			—
Other	—			—			(82		)	—			—			(82		)
Net cash provided by (used in) investing activities	(330,960		)	5,743			(35,774		)	—			—			(360,991		)
Cash flows from financing activities:
Change in book overdrafts	—			—			1,605			—			—			1,605
Borrowings from long-term debt	454,219			—			—			—			—			454,219
Repayments of long-term debt	(1,015		)	—			(96,523		)	—			—			(97,538		)
Borrowings on revolving lines of credit	—			—			10,000			—			—			10,000
Repayments on revolving lines of credit	—			—			(10,000		)	—			—			(10,000		)
Debt issuance costs and other refinancing costs	(15,407		)	—			(11,646		)	—			—			(27,053		)
Dividends/distributions	(470		)	(8,500		)	(68,300		)	—			76,800			(470		)
Exercise of stock options	193			—			—			—			—			193
Transactions with Parent/affiliates	(147,974		)	1,723			157,581			(2,108		)	(9,222		)	—
Net cash provided by (used in) financing activities	289,546			(6,777		)	(17,283		)	(2,108		)	67,578			330,956
Effect of foreign exchange rates on cash	—			—			(1,038		)	—			—			(1,038		)
Net decrease in cash and cash equivalents	(11,812		)	(2,926		)	(3,011		)	(2,751		)	—			(20,500		)
Cash and cash equivalents, beginning of period	25,326			3,341			27,451			4,992			—			61,110
Cash and cash equivalents, end of period	$	13,514		$	415		$	24,440		$	2,241		$	—		$	40,610

CONSOLIDATING STATEMENTS OF CASH FLOWS

Six Months Ended June 30, 2013

(In thousands)

Statements of Cash Flows	Parent/ Issuer			Co-Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Cash flows from operating activities:
Net income (loss)	$	(1,870	)	$	3,829		$	18,173		$	1,045		$	(23,047	)	$	(1,870	)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Equity in income of subsidiaries	(27,450		)	—			—			—			27,450			—
Depreciation, depletion, and amortization	187			5,082			24,554			—			—			29,823
Accretion of asset retirement obligation and receivable	—			32			6,305			1			—			6,338
Amortization of intangible assets and liabilities, net	—			312			19			(5		)	—			326
Share-based compensation	1,567			23			2,181			—			—			3,771
Gain on sales of assets	—			—			(308		)	—			—			(308		)
Amortization of deferred financing costs	1,541			—			315			—			—			1,856
Loss on extinguishment of debt	64			—			—			—			—			64
Loss on sales of investment securities	—			—			(28		)	—			—			(28		)
Changes in operating assets and liabilities:
Receivables, net	(227		)	(1,995		)	4,419			(239		)	1,729			3,687
Inventories	—			(1,632		)	(345		)	—			—			(1,977		)
Excess of black lung benefit obligation over trust assets	(280		)	—			—			(1		)	—			(281		)
Accounts payable and accrued expenses	(1,957		)	4,101			904			(1,146		)	(201		)	1,701
Deferred revenue	—			(4,190		)	(2,025		)	1			—			(6,214		)
Income tax payable	—			—			(55		)	(1		)	—			(56		)
Accrual for workers’ compensation	(284		)	—			—			—			—			(284		)
Asset retirement obligations	—			—			(5,422		)	(2		)	—			(5,424		)
Accrual for postretirement medical benefits	(40		)	—			4,010			124			—			4,094
Pension and SERP obligations	695			9			826			(13		)	—			1,517
Other assets and liabilities	(49		)	101			(1,489		)	(374		)	—			(1,811		)
Distributions received from subsidiaries	36,600			—			—			—			(36,600		)	—
Net cash provided by (used in) operating activities	8,497			5,672			52,034			(610		)	(30,669		)	34,924
Cash flows from investing activities:
Additions to property, plant and equipment	(575		)	(698		)	(12,189		)	(4		)	(1		)	(13,467		)
Change in restricted investments and bond collateral and reclamation deposits	(807		)	(5		)	(7,902		)	—			—			(8,714		)
Net proceeds from sales of assets	—			—			577			—			—			577
Proceeds from the sale of investments	—			—			6,807			—			—			6,807

Receivable from customer for property and equipment purchases	—			—			(307		)	(1		)	—			(308		)
Net cash used in investing activities	(1,382		)	(703		)	(13,014		)	(5		)	(1		)	(15,105		)
Cash flows from financing activities:
Change in book overdrafts	—			—			1,777			—			—			1,777
Repayments of long-term debt	(500		)	—			(15,561		)	(9		)	—			(16,070		)
Borrowings on revolving lines of credit	—			—			6,000			—			—			6,000
Repayments on revolving lines of credit	—			—			(6,000		)	—			—			(6,000		)
Debt issuance costs and other refinancing costs	(26		)	—			(156		)	—			—			(182		)
Dividends/distributions	(680		)	(9,000		)	(27,600		)	—			36,600			(680		)
Transactions with Parent/affiliates	(5,080		)	(38		)	8,699			2,349			(5,930		)	—
Net cash provided by (used in) financing activities	(6,286		)	(9,038		)	(32,841		)	2,340			30,670			(15,155		)
Net increase (decrease) in cash and cash equivalents	829			(4,069		)	6,179			1,725			—			4,664
Cash and cash equivalents, beginning of period	14,836			4,545			10,237			1,992			—			31,610
Cash and cash equivalents, end of period	$	15,665		$	476		$	16,416		$	3,717		$	—		$	36,274

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POSTRETIREMENT MEDICAL BENEFITS AND PENSION - Postretirement Medicial Benefit Obligations Balance Sheet Disclosures (Details) (Postretirement Medical Benefits, USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Postretirement Medical Benefits
Components of net periodic benefit cost:
Service cost	$ 822	$ 1,109	$ 1,645	$ 2,218
Interest cost	3,203	3,035	6,407	6,069
Amortization of deferred items	4	1,001	9	2,003
Total net periodic benefit cost	$ 4,029	$ 5,145	$ 8,061	$ 10,290

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RESTRICTED INVESTMENTS AND BOND COLLATERAL - Amortized Cost, Gross Unrealized Holding Gains and Losses and Fair Value of Held-to-Maturity Securities (Detail) (Held-to-maturity securities, USD $) In Thousands, unless otherwise specified	Jun. 30, 2014
Held-to-maturity securities
Schedule of Held-to-maturity Securities [Line Items]
Amortized cost	$ 34,720
Gross unrealized holding gains	628
Gross unrealized holding losses	(89)
Fair value	$ 35,259

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SHARE-BASED COMPENSATION - Summary of Stock Options and SARs (Details) (USD $) In Thousands, except Share data, unless otherwise specified	6 Months Ended
	Jun. 30, 2014
Stock Appreciation Rights (SARs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Balance, beginning of period, shares	70,734
Exercised, shares	(36,291)
Expired, shares	0
Balance, end of period, shares	34,443
Balance, beginning of period, weighted average exercise price	$ 22.60
Exercised, weighted average exercise price	$ 21.30
Expired, weighted average exercise price	$ 0.00
Balance, end of period, weighted average exercise price	$ 23.97
Outstanding - Weighted Average Remaining Contractual Life (In years)	1 year 7 months 26 days
Exercisable - Weighted Average Remaining Contractual Life (In years)	1 year 7 months 26 days
Aggregate Intrinsic Value	$ 424
Unamortized Compensation Expense	0
Granted, shares	0
Stock Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Balance, beginning of period, shares	145,806
Exercised, shares	(9,000)
Expired, shares	0
Balance, end of period, shares	136,806
Balance, beginning of period, weighted average exercise price	$ 21.97
Exercised, weighted average exercise price	$ 21.40
Expired, weighted average exercise price	$ 0.00
Balance, end of period, weighted average exercise price	$ 22.01
Outstanding - Weighted Average Remaining Contractual Life (In years)	3 years 8 months 12 days
Exercisable - Weighted Average Remaining Contractual Life (In years)	3 years 8 months 12 days
Aggregate Intrinsic Value	1,953
Unamortized Compensation Expense	$ 0
Granted, shares	0

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POSTRETIREMENT MEDICAL BENEFITS AND PENSION - Postretirement Medical Benefit Obligations Income Statement Disclosures (Details) (Postretirement Medical Benefits, USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Net periodic postretirement medical benefit costs relating to current and former mining operations:
Total net periodic benefit cost	$ 4,029	$ 5,145	$ 8,061	$ 10,290
Former Mining Operations
Net periodic postretirement medical benefit costs relating to current and former mining operations:
Total net periodic benefit cost	2,402	3,119	4,807	6,237
Current Operations
Net periodic postretirement medical benefit costs relating to current and former mining operations:
Total net periodic benefit cost	$ 1,627	$ 2,026	$ 3,254	$ 4,053

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SUPPLEMENTAL CONSOLIDATING FINANCIAL INFORMATION - Supplemental Consolidating Statement of Cash Flow Information (Detail) (USD $)	6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013
Cash flows from operating activities:
Net income (loss)	$ (82,185,000)	$ (1,870,000)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Equity in income of subsidiaries	0	0
Depreciation, depletion, and amortization	40,538,000	29,823,000
Accretion of asset retirement obligation and receivable	9,288,000	6,338,000
Non-cash tax benefits	(224,000)	0
Amortization of intangible assets and liabilities, net	310,000	326,000
Share-based compensation	2,445,000	3,771,000
Gain on sales of assets	(5,000)	(308,000)
Amortization of deferred financing costs	1,209,000	1,856,000
Loss on sales of investment securities		(28,000)
Loss on extinguishment of debt	12,635,000	64,000
Loss (gain) on sales of investment securities	3,000	(28,000)
Derivative loss	5,930,000	0
Loss on foreign exchange	4,141,000	0
Income from equity affiliates	(799,000)	0
Distributions from equity affiliates	730,000	0
Changes in operating assets and liabilities:
Receivables, net	(11,270,000)	3,687,000
Inventories	22,770,000	(1,977,000)
Excess of black lung benefit obligation over trust assets	1,166,000	(281,000)
Deferred income tax	3,854,000	0
Accounts payable and accrued expenses	8,538,000	1,701,000
Deferred revenue	(8,424,000)	(6,214,000)
Income tax payable	528,000	(56,000)
Accrual for workers' compensation	(125,000)	(284,000)
Asset retirement obligations	(3,362,000)	(5,424,000)
Accrual for postretirement medical benefits	1,409,000	4,094,000
Pension and SERP obligations	(332,000)	1,517,000
Other assets and liabilities	1,805,000	(1,811,000)
Distributions received from subsidiaries	0	0
Net cash provided by operating activities	10,573,000	34,924,000
Cash flows from investing activities:
Additions to property, plant and equipment	(17,361,000)	(13,467,000)
Change in restricted investments and bond collateral and reclamation deposits	(30,517,000)	(8,714,000)
Cash payments related to Canadian acquisition	(322,637,000)	0
Cash acquired in related to Canadian acquisition	8,103,000	0
Net proceeds from sales of assets	213,000	577,000
Proceeds from sale of investments	246,000	6,807,000
Increase in loan and lease receivable	(1,120,000)	0
Receipts from loan and lease receivable	2,164,000	0
Receivable from customer for property and equipment purchases	0	(308,000)
Other	(82,000)	0
Net cash used in investing activities	(360,991,000)	(15,105,000)
Cash flows from financing activities:
Change in book overdrafts	1,605,000	1,777,000
Borrowings from long-term debt	454,219,000	0
Repayments of long-term debt	(97,538,000)	(16,070,000)
Borrowings on revolving lines of credit	10,000,000	6,000,000
Repayments on revolving lines of credit	(10,000,000)	(6,000,000)
Debt issuance costs and other refinancing costs	(27,053,000)	(182,000)
Dividends/distributions	(470,000)	(680,000)
Exercise of stock options	193,000	0
Transactions with Parent/affiliates	0	0
Net cash provided by (used in) financing activities	330,956,000	(15,155,000)
Effect of foreign exchange rates on cash	(1,038,000)	0
Net increase (decrease) in cash and cash equivalents	(20,500,000)	4,664,000
Cash and cash equivalents, beginning of period	61,110,000	31,610,000
Cash and cash equivalents, end of period	40,610,000	36,274,000
Parent/ Issuer
Cash flows from operating activities:
Net income (loss)	(82,185,000)	(1,870,000)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Equity in income of subsidiaries	16,148,000	(27,450,000)
Depreciation, depletion, and amortization	156,000	187,000
Accretion of asset retirement obligation and receivable	0	0
Non-cash tax benefits	(224,000)
Amortization of intangible assets and liabilities, net	0	0
Share-based compensation	1,934,000	1,567,000
Gain on sales of assets	0	0
Amortization of deferred financing costs	494,000	1,541,000
Loss on sales of investment securities		0
Loss on extinguishment of debt	62,000	64,000
Loss (gain) on sales of investment securities	0
Derivative loss	0
Loss on foreign exchange	5,233,000
Income from equity affiliates	0
Distributions from equity affiliates	0
Changes in operating assets and liabilities:
Receivables, net	943,000	(227,000)
Inventories	0	0
Excess of black lung benefit obligation over trust assets	1,166,000	(280,000)
Deferred income tax	0
Accounts payable and accrued expenses	17,348,000	(1,957,000)
Deferred revenue	0	0
Income tax payable	0	0
Accrual for workers' compensation	(125,000)	(284,000)
Asset retirement obligations	0	0
Accrual for postretirement medical benefits	(885,000)	(40,000)
Pension and SERP obligations	166,000	695,000
Other assets and liabilities	(7,429,000)	(49,000)
Distributions received from subsidiaries	76,800,000	36,600,000
Net cash provided by operating activities	29,602,000	8,497,000
Cash flows from investing activities:
Additions to property, plant and equipment	16,000	(575,000)
Change in restricted investments and bond collateral and reclamation deposits	(48,188,000)	(807,000)
Cash payments related to Canadian acquisition	(282,788,000)
Cash acquired in related to Canadian acquisition	0
Net proceeds from sales of assets	0	0
Proceeds from sale of investments	0	0
Increase in loan and lease receivable	0
Receipts from loan and lease receivable	0
Receivable from customer for property and equipment purchases	0	0
Other	0
Net cash used in investing activities	(330,960,000)	(1,382,000)
Cash flows from financing activities:
Change in book overdrafts	0	0
Borrowings from long-term debt	454,219,000
Repayments of long-term debt	(1,015,000)	(500,000)
Borrowings on revolving lines of credit	0	0
Repayments on revolving lines of credit	0	0
Debt issuance costs and other refinancing costs	(15,407,000)	(26,000)
Dividends/distributions	(470,000)	(680,000)
Exercise of stock options	193,000
Transactions with Parent/affiliates	(147,974,000)	(5,080,000)
Net cash provided by (used in) financing activities	289,546,000	(6,286,000)
Effect of foreign exchange rates on cash	0
Net increase (decrease) in cash and cash equivalents	(11,812,000)	829,000
Cash and cash equivalents, beginning of period	25,326,000	14,836,000
Cash and cash equivalents, end of period	13,514,000	15,665,000
Co-Issuer
Cash flows from operating activities:
Net income (loss)	(7,842,000)	3,829,000
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Equity in income of subsidiaries	0	0
Depreciation, depletion, and amortization	5,009,000	5,082,000
Accretion of asset retirement obligation and receivable	34,000	32,000
Non-cash tax benefits	0
Amortization of intangible assets and liabilities, net	290,000	312,000
Share-based compensation	14,000	23,000
Gain on sales of assets	0	0
Amortization of deferred financing costs	0	0
Loss on sales of investment securities		0
Loss on extinguishment of debt	0	0
Loss (gain) on sales of investment securities	0
Derivative loss	5,930,000
Loss on foreign exchange	0
Income from equity affiliates	0
Distributions from equity affiliates	0
Changes in operating assets and liabilities:
Receivables, net	(6,000)	(1,995,000)
Inventories	842,000	(1,632,000)
Excess of black lung benefit obligation over trust assets	0	0
Deferred income tax	0
Accounts payable and accrued expenses	(1,101,000)	4,101,000
Deferred revenue	(4,791,000)	(4,190,000)
Income tax payable	0	0
Accrual for workers' compensation	0	0
Asset retirement obligations	0	0
Accrual for postretirement medical benefits	0	0
Pension and SERP obligations	2,000	9,000
Other assets and liabilities	(273,000)	101,000
Distributions received from subsidiaries	0	0
Net cash provided by operating activities	(1,892,000)	5,672,000
Cash flows from investing activities:
Additions to property, plant and equipment	(255,000)	(698,000)
Change in restricted investments and bond collateral and reclamation deposits	5,998,000	(5,000)
Cash payments related to Canadian acquisition	0
Cash acquired in related to Canadian acquisition	0
Net proceeds from sales of assets	0	0
Proceeds from sale of investments	0	0
Increase in loan and lease receivable	0
Receipts from loan and lease receivable	0
Receivable from customer for property and equipment purchases	0	0
Other	0
Net cash used in investing activities	5,743,000	(703,000)
Cash flows from financing activities:
Change in book overdrafts	0	0
Borrowings from long-term debt	0
Repayments of long-term debt	0	0
Borrowings on revolving lines of credit	0	0
Repayments on revolving lines of credit	0	0
Debt issuance costs and other refinancing costs	0	0
Dividends/distributions	(8,500,000)	(9,000,000)
Exercise of stock options	0
Transactions with Parent/affiliates	1,723,000	(38,000)
Net cash provided by (used in) financing activities	(6,777,000)	(9,038,000)
Effect of foreign exchange rates on cash	0
Net increase (decrease) in cash and cash equivalents	(2,926,000)	(4,069,000)
Cash and cash equivalents, beginning of period	3,341,000	4,545,000
Cash and cash equivalents, end of period	415,000	476,000
Guarantor Subsidiaries
Cash flows from operating activities:
Net income (loss)	(9,722,000)	18,173,000
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Equity in income of subsidiaries	0	0
Depreciation, depletion, and amortization	35,373,000	24,554,000
Accretion of asset retirement obligation and receivable	9,254,000	6,305,000
Non-cash tax benefits	0
Amortization of intangible assets and liabilities, net	20,000	19,000
Share-based compensation	497,000	2,181,000
Gain on sales of assets	(5,000)	(308,000)
Amortization of deferred financing costs	715,000	315,000
Loss on sales of investment securities		(28,000)
Loss on extinguishment of debt	12,572,000	0
Loss (gain) on sales of investment securities	3,000
Derivative loss	0
Loss on foreign exchange	(1,092,000)
Income from equity affiliates	(799,000)
Distributions from equity affiliates	730,000
Changes in operating assets and liabilities:
Receivables, net	(18,474,000)	4,419,000
Inventories	21,929,000	(345,000)
Excess of black lung benefit obligation over trust assets	0	0
Deferred income tax	3,854,000
Accounts payable and accrued expenses	(3,164,000)	904,000
Deferred revenue	(3,633,000)	(2,025,000)
Income tax payable	528,000	(55,000)
Accrual for workers' compensation	0	0
Asset retirement obligations	(3,364,000)	(5,422,000)
Accrual for postretirement medical benefits	2,256,000	4,010,000
Pension and SERP obligations	(507,000)	826,000
Other assets and liabilities	4,113,000	(1,489,000)
Distributions received from subsidiaries	0	0
Net cash provided by operating activities	51,084,000	52,034,000
Cash flows from investing activities:
Additions to property, plant and equipment	(17,122,000)	(12,189,000)
Change in restricted investments and bond collateral and reclamation deposits	11,673,000	(7,902,000)
Cash payments related to Canadian acquisition	(39,849,000)
Cash acquired in related to Canadian acquisition	8,103,000
Net proceeds from sales of assets	213,000	577,000
Proceeds from sale of investments	246,000	6,807,000
Increase in loan and lease receivable	(1,120,000)
Receipts from loan and lease receivable	2,164,000
Receivable from customer for property and equipment purchases	0	(307,000)
Other	(82,000)
Net cash used in investing activities	(35,774,000)	(13,014,000)
Cash flows from financing activities:
Change in book overdrafts	1,605,000	1,777,000
Borrowings from long-term debt	0
Repayments of long-term debt	(96,523,000)	(15,561,000)
Borrowings on revolving lines of credit	10,000,000	6,000,000
Repayments on revolving lines of credit	(10,000,000)	(6,000,000)
Debt issuance costs and other refinancing costs	(11,646,000)	(156,000)
Dividends/distributions	(68,300,000)	(27,600,000)
Exercise of stock options	0
Transactions with Parent/affiliates	157,581,000	8,699,000
Net cash provided by (used in) financing activities	(17,283,000)	(32,841,000)
Effect of foreign exchange rates on cash	(1,038,000)
Net increase (decrease) in cash and cash equivalents	(3,011,000)	6,179,000
Cash and cash equivalents, beginning of period	27,451,000	10,237,000
Cash and cash equivalents, end of period	24,440,000	16,416,000
Non-Guarantor Subsidiaries
Cash flows from operating activities:
Net income (loss)	296,000	1,045,000
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Equity in income of subsidiaries	0	0
Depreciation, depletion, and amortization	0	0
Accretion of asset retirement obligation and receivable	0	1,000
Non-cash tax benefits	0
Amortization of intangible assets and liabilities, net	0	(5,000)
Share-based compensation	0	0
Gain on sales of assets	0	0
Amortization of deferred financing costs	0	0
Loss on sales of investment securities		0
Loss on extinguishment of debt	1,000	0
Loss (gain) on sales of investment securities	0
Derivative loss	0
Loss on foreign exchange	0
Income from equity affiliates	0
Distributions from equity affiliates	0
Changes in operating assets and liabilities:
Receivables, net	4,733,000	(239,000)
Inventories	(1,000)	0
Excess of black lung benefit obligation over trust assets	0	(1,000)
Deferred income tax	0
Accounts payable and accrued expenses	(4,526,000)	(1,146,000)
Deferred revenue	0	1,000
Income tax payable	0	(1,000)
Accrual for workers' compensation	0	0
Asset retirement obligations	2,000	(2,000)
Accrual for postretirement medical benefits	38,000	124,000
Pension and SERP obligations	7,000	(13,000)
Other assets and liabilities	(1,193,000)	(374,000)
Distributions received from subsidiaries	0	0
Net cash provided by operating activities	(643,000)	(610,000)
Cash flows from investing activities:
Additions to property, plant and equipment	0	(4,000)
Change in restricted investments and bond collateral and reclamation deposits	0	0
Cash payments related to Canadian acquisition	0
Cash acquired in related to Canadian acquisition	0
Net proceeds from sales of assets	0	0
Proceeds from sale of investments	0	0
Increase in loan and lease receivable	0
Receipts from loan and lease receivable	0
Receivable from customer for property and equipment purchases	0	(1,000)
Other	0
Net cash used in investing activities	0	(5,000)
Cash flows from financing activities:
Change in book overdrafts	0	0
Borrowings from long-term debt	0
Repayments of long-term debt	0	(9,000)
Borrowings on revolving lines of credit	0	0
Repayments on revolving lines of credit	0	0
Debt issuance costs and other refinancing costs	0	0
Dividends/distributions	0	0
Exercise of stock options	0
Transactions with Parent/affiliates	(2,108,000)	2,349,000
Net cash provided by (used in) financing activities	(2,108,000)	2,340,000
Effect of foreign exchange rates on cash	0
Net increase (decrease) in cash and cash equivalents	(2,751,000)	1,725,000
Cash and cash equivalents, beginning of period	4,992,000	1,992,000
Cash and cash equivalents, end of period	2,241,000	3,717,000
Consolidating Adjustments
Cash flows from operating activities:
Net income (loss)	17,268,000	(23,047,000)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Equity in income of subsidiaries	(16,148,000)	27,450,000
Depreciation, depletion, and amortization	0	0
Accretion of asset retirement obligation and receivable	0	0
Non-cash tax benefits	0
Amortization of intangible assets and liabilities, net	0	0
Share-based compensation	0	0
Gain on sales of assets	0	0
Amortization of deferred financing costs	0	0
Loss on sales of investment securities		0
Loss on extinguishment of debt	0	0
Loss (gain) on sales of investment securities	0
Derivative loss	0
Loss on foreign exchange	0
Income from equity affiliates	0
Distributions from equity affiliates	0
Changes in operating assets and liabilities:
Receivables, net	1,534,000	1,729,000
Inventories	0	0
Excess of black lung benefit obligation over trust assets	0	0
Deferred income tax	0
Accounts payable and accrued expenses	(19,000)	(201,000)
Deferred revenue	0	0
Income tax payable	0	0
Accrual for workers' compensation	0	0
Asset retirement obligations	0	0
Accrual for postretirement medical benefits	0	0
Pension and SERP obligations	0	0
Other assets and liabilities	6,587,000	0
Distributions received from subsidiaries	(76,800,000)	(36,600,000)
Net cash provided by operating activities	(67,578,000)	(30,669,000)
Cash flows from investing activities:
Additions to property, plant and equipment	0	(1,000)
Change in restricted investments and bond collateral and reclamation deposits	0	0
Cash payments related to Canadian acquisition	0
Cash acquired in related to Canadian acquisition	0
Net proceeds from sales of assets	0	0
Proceeds from sale of investments	0	0
Increase in loan and lease receivable	0
Receipts from loan and lease receivable	0
Receivable from customer for property and equipment purchases	0	0
Other	0
Net cash used in investing activities	0	(1,000)
Cash flows from financing activities:
Change in book overdrafts	0	0
Borrowings from long-term debt	0
Repayments of long-term debt	0	0
Borrowings on revolving lines of credit	0	0
Repayments on revolving lines of credit	0	0
Debt issuance costs and other refinancing costs	0	0
Dividends/distributions	76,800,000	36,600,000
Exercise of stock options	0
Transactions with Parent/affiliates	(9,222,000)	(5,930,000)
Net cash provided by (used in) financing activities	67,578,000	30,670,000
Effect of foreign exchange rates on cash	0
Net increase (decrease) in cash and cash equivalents	0	0
Cash and cash equivalents, beginning of period	0	0
Cash and cash equivalents, end of period	$ 0	$ 0

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RESTRICTED INVESTMENTS AND BOND COLLATERAL - Components of Restricted Investments and Bond Collateral (Detail) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Restricted Investments and Bond Collateral [Line Items]
Total restricted investments and bond collateral	$ 104,511	$ 75,233
Less current portion	0	(5,998)
Total restricted investments and bond collateral, less current portion	104,511	69,235
Coal - Canada Segment | CVRI
Restricted Investments and Bond Collateral [Line Items]
Total restricted investments and bond collateral	31,867	0
Coal - Canada Segment | PMRU
Restricted Investments and Bond Collateral [Line Items]
Total restricted investments and bond collateral	16,201	0
Debt Reserve Account | Coal - U.S. Segment
Restricted Investments and Bond Collateral [Line Items]
Total restricted investments and bond collateral	0	13,067
Reclamation Bond Collateral | Coal - U.S. Segment | Kemmerer Mine
Restricted Investments and Bond Collateral [Line Items]
Total restricted investments and bond collateral	25,077	24,966
Reclamation Bond Collateral | Coal - U.S. Segment | Absaloka Mine
Restricted Investments and Bond Collateral [Line Items]
Total restricted investments and bond collateral	11,696	11,653
Reclamation Bond Collateral | Coal - U.S. Segment | Rosebud Mine
Restricted Investments and Bond Collateral [Line Items]
Total restricted investments and bond collateral	3,145	3,145
Reclamation Bond Collateral | Coal - U.S. Segment | Beulah Mine
Restricted Investments and Bond Collateral [Line Items]
Total restricted investments and bond collateral	1,270	1,270
Letter of Credit Account | Power Segment
Restricted Investments and Bond Collateral [Line Items]
Total restricted investments and bond collateral	0	5,998
Postretirement Medical Benefit Bonds | Corporate Segment
Restricted Investments and Bond Collateral [Line Items]
Total restricted investments and bond collateral	8,550	8,467
Workers' Compensation Bonds | Corporate Segment
Restricted Investments and Bond Collateral [Line Items]
Total restricted investments and bond collateral	$ 6,705	$ 6,667

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DERIVATIVE INSTRUMENTS (Tables)

6 Months Ended

Jun. 30, 2014

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Other Derivatives Not Designated as Hedging Instruments, Statements of Financial Performance and Financial Position, Location [Table Text Block]

The fair value of outstanding derivative instruments not designated as hedging instruments on the accompanying Consolidated Balance Sheet was as follows (in thousands):

Derivative Instruments	Balance Sheet Location	June 30, 2014
Contracts to purchase power	Other current liabilities	$	140
Contracts to purchase power	Other liabilities	5,790

The effect of derivative instruments not designated as hedging instruments on the accompanying Consolidated Statements of Operations was as follows (in thousands):

Derivative Instruments	Statement of Operations Location	Three Months Ended June 30, 2014			Six Months Ended June 30, 2014
Canadian dollar foreign exchange forward contracts	Gain (loss) on foreign exchange	$	581		$	(6,209	)
Contracts to purchase power	Derivative loss	(5,930		)	(5,930		)

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BUSINESS SEGMENT INFORMATION - Summarized Financial Information by Segment (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended				6 Months Ended
	Jun. 30, 2014		Jun. 30, 2013		Jun. 30, 2014 segments		Jun. 30, 2013		Dec. 31, 2013
Segment Reporting Information [Line Items]
Number of Reportable Segments					5
Revenues	$ 287,956		$ 162,499		$ 468,159		$ 323,947
Restructuring charges	7,543		0		7,941		0
Depreciation, depletion and amortization	24,479		15,397		40,538		29,823
Income (loss) from operations	(29,640)		11,975		(21,588)		17,710
Total assets	1,583,721		933,603		1,583,721		933,603		946,685
Capital expenditures	14,311		8,166		17,361		13,467
Coal - U.S. Segment
Segment Reporting Information [Line Items]
Revenues	150,107		139,337		308,298		281,449
Restructuring charges	491				491
Depreciation, depletion and amortization	13,283		12,804		26,780		24,658
Income (loss) from operations	(423)		12,572		12,275		25,566
Total assets	670,375		699,556		670,375		699,556
Capital expenditures	6,533		7,209		9,586		12,219
Coal - Canada Segment
Segment Reporting Information [Line Items]
Revenues	116,046	[1]	0	[1]	116,046	[1]	0	[1]
Restructuring charges	6,646	[1]			6,646	[1]
Depreciation, depletion and amortization	8,671	[1]	0	[1]	8,671	[1]	0	[1]
Income (loss) from operations	(12,709)	[1]	0	[1]	(12,709)	[1]	0	[1]
Total assets	687,185	[1]	0	[1]	687,185	[1]	0	[1]
Capital expenditures	7,495	[1]	0	[1]	7,495	[1]	0	[1]
Power Segment
Segment Reporting Information [Line Items]
Revenues	21,803		23,162		43,815		42,498
Restructuring charges	101				499
Depreciation, depletion and amortization	2,486		2,551		5,009		5,081
Income (loss) from operations	(9,473)		4,837		(7,731)		3,836
Total assets	165,763		183,855		165,763		183,855
Capital expenditures	220		564		255		698
Heritage Segment
Segment Reporting Information [Line Items]
Revenues	0		0		0		0
Restructuring charges	0				0
Depreciation, depletion and amortization	0		0		0		0
Income (loss) from operations	(3,559)		(3,530)		(7,389)		(7,705)
Total assets	15,664		16,305		15,664		16,305
Capital expenditures	0		0		0		0
Corporate Segment
Segment Reporting Information [Line Items]
Revenues	0		0		0		0
Restructuring charges	305				305
Depreciation, depletion and amortization	39		42		78		84
Income (loss) from operations	(3,476)		(1,904)		(6,034)		(3,987)
Total assets	44,734		33,887		44,734		33,887
Capital expenditures	$ 63		$ 393		$ 25		$ 550

[1] The Canadian operations were acquired on April 28, 2014, therefore, information for the three and six months ended June 30, 2014 includes approximately two months of operations and there is no activity for 2013.

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HERITAGE HEALTH BENEFIT EXPENSES - Components of Costs of Benefits to Former Mining Operation Employees (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Heritage Health Benefit Expenses [Abstract]
Health care benefits	$ 2,376	$ 3,089	$ 4,650	$ 6,266
Combined benefit fund payments	512	576	1,025	1,152
Workers' compensation benefits	124	117	260	232
Black lung benefits (credit)	376	(673)	997	(590)
Total	$ 3,388	$ 3,109	$ 6,932	$ 7,060

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SUPPLEMENTAL CONSOLIDATING FINANCIAL INFORMATION - Supplemental Consolidating Statement of Operations Information (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Condensed Financial Statements, Captions [Line Items]
Revenues	$ 287,956	$ 162,499	$ 468,159	$ 323,947
Costs, expenses and other:
Cost of sales	248,389	130,528	387,019	260,949
Depreciation, depletion and amortization	24,479	15,397	40,538	29,823
Selling and administrative	28,709	11,969	42,040	23,855
Heritage health benefit expenses	3,388	3,109	6,932	7,060
Loss (gain) on sales of assets	(43)	(74)	(5)	(308)
Restructuring charges	7,543	0	7,941	0
Derivative loss	5,930	0	5,930	0
Income from equity affiliates	(799)	0	(799)	0
Other operating loss (income)	0	(10,405)	151	(15,142)
Total costs, expenses and other	317,596	150,524	489,747	306,237
Operating income (loss)	(29,640)	11,975	(21,588)	17,710
Other income (expense):
Interest expense	(21,786)	(10,076)	(42,584)	(20,236)
Loss on extinguishment of debt	(12,635)	(64)	(12,635)	(64)
Interest income	1,582	280	1,884	577
Gain (loss) on foreign exchange	2,649	0	(4,141)	0
Other income	483	130	576	198
Total other income (expense)	(29,707)	(9,730)	(56,900)	(19,525)
Income (loss) before income taxes and income of consolidated subsidiaries	(59,347)	2,245	(78,488)	(1,815)
Equity in income of subsidiaries	0	0	0	0
Income (loss) before income taxes	(59,347)	2,245	(78,488)	(1,815)
Income tax expense (benefit)	3,807	28	3,697	55
Net income (loss)	(63,154)	2,217	(82,185)	(1,870)
Less net income attributable to noncontrolling interest	0	2,499	0	797
Net income (loss) attributable to the Parent company	(63,154)	(282)	(82,185)	(2,667)
Parent/ Issuer
Condensed Financial Statements, Captions [Line Items]
Revenues	0	0	0	0
Costs, expenses and other:
Cost of sales	(247)	(372)	(471)	(770)
Depreciation, depletion and amortization	79	94	156	187
Selling and administrative	12,003	4,259	16,968	8,207
Heritage health benefit expenses	3,178	2,844	6,504	6,533
Loss (gain) on sales of assets	0	0	0	0
Restructuring charges	796		796
Derivative loss	0		0
Income from equity affiliates	0		0
Other operating loss (income)		0	0	0
Total costs, expenses and other	15,809	6,825	23,953	14,157
Operating income (loss)	(15,809)	(6,825)	(23,953)	(14,157)
Other income (expense):
Interest expense	(18,609)	(7,591)	(37,282)	(15,175)
Loss on extinguishment of debt	(63)	(64)	(62)	(64)
Interest income	145	46	269	76
Gain (loss) on foreign exchange	1,557		(5,233)
Other income	0	2	0	0
Total other income (expense)	(16,970)	(7,607)	(42,308)	(15,163)
Income (loss) before income taxes and income of consolidated subsidiaries	(32,779)	(14,432)	(66,261)	(29,320)
Equity in income of subsidiaries	(30,462)	16,648	(16,148)	27,450
Income (loss) before income taxes	(63,241)	2,216	(82,409)	(1,870)
Income tax expense (benefit)	(87)	(1)	(224)	0
Net income (loss)	(63,154)	2,217	(82,185)	(1,870)
Less net income attributable to noncontrolling interest	0	2,499		797
Net income (loss) attributable to the Parent company	(63,154)	(282)	(82,185)	(2,667)
Co-Issuer
Condensed Financial Statements, Captions [Line Items]
Revenues	21,803	23,162	43,815	42,498
Costs, expenses and other:
Cost of sales	21,592	14,901	38,046	31,856
Depreciation, depletion and amortization	2,485	2,551	5,009	5,082
Selling and administrative	1,169	872	2,062	1,726
Heritage health benefit expenses	0	0	0	0
Loss (gain) on sales of assets	0	0	0	0
Restructuring charges	101		499
Derivative loss	5,930		5,930
Income from equity affiliates	0		0
Other operating loss (income)		0	0	0
Total costs, expenses and other	31,277	18,324	51,546	38,664
Operating income (loss)	(9,474)	4,838	(7,731)	3,834
Other income (expense):
Interest expense	(74)	(10)	(118)	(20)
Loss on extinguishment of debt	0	0	0	0
Interest income	4	5	7	15
Gain (loss) on foreign exchange	0		0
Other income	0	0	0	0
Total other income (expense)	(70)	(5)	(111)	(5)
Income (loss) before income taxes and income of consolidated subsidiaries	(9,544)	4,833	(7,842)	3,829
Equity in income of subsidiaries	0	0	0	0
Income (loss) before income taxes	(9,544)	4,833	(7,842)	3,829
Income tax expense (benefit)	0	0	0	0
Net income (loss)	(9,544)	4,833	(7,842)	3,829
Less net income attributable to noncontrolling interest	0	0		0
Net income (loss) attributable to the Parent company	(9,544)	4,833	(7,842)	3,829
Guarantor Subsidiaries
Condensed Financial Statements, Captions [Line Items]
Revenues	266,153	134,449	424,351	274,187
Costs, expenses and other:
Cost of sales	227,044	113,640	349,389	223,417
Depreciation, depletion and amortization	21,915	12,753	35,373	24,554
Selling and administrative	15,921	7,232	23,783	14,680
Heritage health benefit expenses	0	0	0	0
Loss (gain) on sales of assets	(43)	(74)	(5)	(308)
Restructuring charges	6,646		6,646
Derivative loss	0		0
Income from equity affiliates	(799)		(799)
Other operating loss (income)		(10,405)	150	(15,142)
Total costs, expenses and other	270,684	123,146	414,537	247,201
Operating income (loss)	(4,531)	11,303	9,814	26,986
Other income (expense):
Interest expense	(3,111)	(2,479)	(5,199)	(5,048)
Loss on extinguishment of debt	(12,571)	0	(12,572)	0
Interest income	1,433	232	1,608	493
Gain (loss) on foreign exchange	1,092		1,092
Other income	483	130	576	200
Total other income (expense)	(12,674)	(2,117)	(14,495)	(4,355)
Income (loss) before income taxes and income of consolidated subsidiaries	(17,205)	9,186	(4,681)	22,631
Equity in income of subsidiaries	0	0	0	0
Income (loss) before income taxes	(17,205)	9,186	(4,681)	22,631
Income tax expense (benefit)	(74)	1,139	5,041	4,458
Net income (loss)	(17,131)	8,047	(9,722)	18,173
Less net income attributable to noncontrolling interest	0	0		0
Net income (loss) attributable to the Parent company	(17,131)	8,047	(9,722)	18,173
Non-Guarantor Subsidiaries
Condensed Financial Statements, Captions [Line Items]
Revenues	0	9,538	(7)	20,889
Costs, expenses and other:
Cost of sales	0	7,009	55	20,073
Depreciation, depletion and amortization	0	0	0	0
Selling and administrative	(384)	(394)	(773)	(758)
Heritage health benefit expenses	210	265	428	527
Loss (gain) on sales of assets	0	0	0	0
Restructuring charges	0		0
Derivative loss	0		0
Income from equity affiliates	0		0
Other operating loss (income)		0	1	0
Total costs, expenses and other	(174)	6,880	(289)	19,842
Operating income (loss)	174	2,658	282	1,047
Other income (expense):
Interest expense	(1)	(5)	0	(10)
Loss on extinguishment of debt	(1)	0	(1)	0
Interest income	0	6	15	10
Gain (loss) on foreign exchange	0		0
Other income	0	(2)	0	(2)
Total other income (expense)	(2)	(1)	14	(2)
Income (loss) before income taxes and income of consolidated subsidiaries	172	2,657	296	1,045
Equity in income of subsidiaries	0	0	0	0
Income (loss) before income taxes	172	2,657	296	1,045
Income tax expense (benefit)	1	0	0	0
Net income (loss)	171	2,657	296	1,045
Less net income attributable to noncontrolling interest	0	0		0
Net income (loss) attributable to the Parent company	171	2,657	296	1,045
Consolidating Adjustments
Condensed Financial Statements, Captions [Line Items]
Revenues	0	(4,650)	0	(13,627)
Costs, expenses and other:
Cost of sales	0	(4,650)	0	(13,627)
Depreciation, depletion and amortization	0	(1)	0	0
Selling and administrative	0	0	0	0
Heritage health benefit expenses	0	0	0	0
Loss (gain) on sales of assets	0	0	0	0
Restructuring charges	0		0
Derivative loss	0		0
Income from equity affiliates	0		0
Other operating loss (income)		0	0	0
Total costs, expenses and other	0	(4,651)	0	(13,627)
Operating income (loss)	0	1	0	0
Other income (expense):
Interest expense	9	9	15	17
Loss on extinguishment of debt	0	0	0	0
Interest income	0	(9)	(15)	(17)
Gain (loss) on foreign exchange	0		0
Other income	0	0	0	0
Total other income (expense)	9	0	0	0
Income (loss) before income taxes and income of consolidated subsidiaries	9	1	0	0
Equity in income of subsidiaries	30,462	(16,648)	16,148	(27,450)
Income (loss) before income taxes	30,471	(16,647)	16,148	(27,450)
Income tax expense (benefit)	3,967	(1,110)	(1,120)	(4,403)
Net income (loss)	26,504	(15,537)	17,268	(23,047)
Less net income attributable to noncontrolling interest	0	0		0
Net income (loss) attributable to the Parent company	$ 26,504	$ (15,537)	$ 17,268	$ (23,047)

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SUPPLEMENTAL CONSOLIDATING FINANCIAL INFORMATION - Supplemental Consolidating Statements of Comprehensive Income (Loss) (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Condensed Financial Statements, Captions [Line Items]
Net income (loss)	$ (63,154)	$ 2,217	$ (82,185)	$ (1,870)
Other comprehensive income (loss)
Amortization of accumulated actuarial gains or losses, pension	359	1,004	717	1,745
Amortization of accumulated actuarial gains or losses, transition obligations, and prior service costs, postretirement medical benefit	5	1,001	10	2,002
Tax effect of other comprehensive income gains	64	0	(224)	0
Change in foreign currency translation adjustment	9,477	0	9,477	0
Unrealized and realized gains and losses on available-for-sale securities	0	(39)	0	(39)
Other comprehensive income	9,905	1,966	9,980	3,708
Comprehensive income (loss) attributable to Westmoreland Coal Company	(53,249)	4,183	(72,205)	1,838
Parent/ Issuer
Condensed Financial Statements, Captions [Line Items]
Net income (loss)	(63,154)	2,217	(82,185)	(1,870)
Other comprehensive income (loss)
Amortization of accumulated actuarial gains or losses, pension	359	1,004	717	1,745
Amortization of accumulated actuarial gains or losses, transition obligations, and prior service costs, postretirement medical benefit	5	1,001	10	2,002
Tax effect of other comprehensive income gains	64		(224)
Change in foreign currency translation adjustment	9,477		9,477
Unrealized and realized gains and losses on available-for-sale securities		(39)		(39)
Other comprehensive income	9,905	1,966	9,980	3,708
Comprehensive income (loss) attributable to Westmoreland Coal Company	(53,249)	4,183	(72,205)	1,838
Co-Issuer
Condensed Financial Statements, Captions [Line Items]
Net income (loss)	(9,544)	4,833	(7,842)	3,829
Other comprehensive income (loss)
Amortization of accumulated actuarial gains or losses, pension	2	8	4	14
Amortization of accumulated actuarial gains or losses, transition obligations, and prior service costs, postretirement medical benefit	0	0	0	0
Tax effect of other comprehensive income gains	0		0
Change in foreign currency translation adjustment	0		0
Unrealized and realized gains and losses on available-for-sale securities		0		0
Other comprehensive income	2	8	4	14
Comprehensive income (loss) attributable to Westmoreland Coal Company	(9,542)	4,841	(7,838)	3,843
Guarantor Subsidiaries
Condensed Financial Statements, Captions [Line Items]
Net income (loss)	(17,131)	8,047	(9,722)	18,173
Other comprehensive income (loss)
Amortization of accumulated actuarial gains or losses, pension	122	239	244	432
Amortization of accumulated actuarial gains or losses, transition obligations, and prior service costs, postretirement medical benefit	(36)	214	(72)	427
Tax effect of other comprehensive income gains	0		0
Change in foreign currency translation adjustment	9,477		9,477
Unrealized and realized gains and losses on available-for-sale securities		(40)		(40)
Other comprehensive income	9,563	413	9,649	819
Comprehensive income (loss) attributable to Westmoreland Coal Company	(7,568)	8,460	(73)	18,992
Non-Guarantor Subsidiaries
Condensed Financial Statements, Captions [Line Items]
Net income (loss)	171	2,657	296	1,045
Other comprehensive income (loss)
Amortization of accumulated actuarial gains or losses, pension	6	0	11	0
Amortization of accumulated actuarial gains or losses, transition obligations, and prior service costs, postretirement medical benefit	5	0	10	0
Tax effect of other comprehensive income gains	0		0
Change in foreign currency translation adjustment	0		0
Unrealized and realized gains and losses on available-for-sale securities		0		0
Other comprehensive income	11	0	21	0
Comprehensive income (loss) attributable to Westmoreland Coal Company	182	2,657	317	1,045
Consolidating Adjustments
Condensed Financial Statements, Captions [Line Items]
Net income (loss)	26,504	(15,537)	17,268	(23,047)
Other comprehensive income (loss)
Amortization of accumulated actuarial gains or losses, pension	(130)	(247)	(259)	(446)
Amortization of accumulated actuarial gains or losses, transition obligations, and prior service costs, postretirement medical benefit	31	(214)	62	(427)
Tax effect of other comprehensive income gains	0		0
Change in foreign currency translation adjustment	(9,477)		(9,477)
Unrealized and realized gains and losses on available-for-sale securities		40		40
Other comprehensive income	(9,576)	(421)	(9,674)	(833)
Comprehensive income (loss) attributable to Westmoreland Coal Company	$ 16,928	$ (15,958)	$ 7,594	$ (23,880)

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SHARE-BASED COMPENSATION - Narrative (Details) (USD $)	6 Months Ended
	Jun. 30, 2014
Restricted Stock Units (RSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Period for recognition of unamortized compensation expense	3 years
Amended And Restated Equity Incentive Stock Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Non Employee Directors Annual Equity Awards Amount	$ 90,000

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ACQUISITION (Tables)

6 Months Ended

Jun. 30, 2014

Business Combinations [Abstract]

Summary of purchase consideration and allocation of purchase consideration

A summary of the purchase consideration and a preliminary allocation of the purchase consideration follows (in millions):

Purchase Price:
Cash paid - Initial payment	$	282.8
Cash paid - Working capital adjustment	39.8
Total cash consideration	$	322.6
Preliminary allocation of purchase price:
Assets:
Cash and cash equivalents	$	26.2
Trade receivables	49.9
Inventories - materials and supplies	52.0
Inventories - coal	79.8
Leases and loans receivable	11.2
Deferred tax assets	6.7
Other current assets	3.4
Total current assets	229.2
Land and mineral rights	151.3
Plant and equipment	171.7
Leases and loans receivable	83.8
Contractual third-party reclamation receivables, less current portion	6.8
Other assets	10.3
Total Assets	653.1
Liabilities:
Current installments of long-term debt	(36.3		)
Trade payables and other accrued liabilities	(93.7		)
Asset retirement obligations	(9.7		)
Total current liabilities	(139.7		)
Long-term debt, less current installments	(86.3		)
Asset retirement obligations, less current portion	(92.4		)
Deferred tax liabilities	(12.1		)
Total Liabilities	(330.5		)
Net fair value	$	322.6

Summary of pro forma information

The following unaudited pro forma information has been prepared for illustrative purposes only and assumes the acquisition occurred on January 1, 2013. The unaudited pro forma results have been prepared based on estimates and assumptions, which the Company believes are reasonable, however, they are not necessarily indicative of the consolidated results of operations had the acquisition occurred on January 1, 2013, or of future results of operations.

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
Total Revenues	(In thousands, except per share data)
As reported	$	287,956		$	162,499		$	468,159		$	323,947
Pro forma	$	320,761		$	356,962		$	674,378		$	672,735
Operating Income
As reported	$	(29,640	)	$	11,975		$	(21,588	)	$	17,710
Pro forma	$	(50,032	)	$	17,081		$	(14,433	)	$	30,105
Net loss applicable to common shareholders
As reported	$	(63,363	)	$	(622	)	$	(82,655	)	$	(3,347	)
Pro forma	$	(89,247	)	$	(4,167	)	$	(97,509	)	$	(9,131	)
Net loss per share applicable to common shareholders
As reported	$	(4.19	)	$	(0.04	)	$	(5.52	)	$	(0.23	)
Pro forma	$	(5.90	)	$	(0.29	)	$	(6.52	)	$	(0.63	)

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RESTRUCTURING CHARGES (Details) (USD $)	3 Months Ended		6 Months Ended		3 Months Ended	6 Months Ended	12 Months Ended	6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014 ROVA I and ROVA II Contracts	Jun. 30, 2014 ROVA I and ROVA II Contracts	Dec. 31, 2013 ROVA I and ROVA II Contracts	Jun. 30, 2014 Canadian Acquisition
Restructuring Cost and Reserve [Line Items]
Remaining Period of Contract							5 years
Restructuring Reserve [Roll Forward]
Beginning balance						$ 5,100,000		$ 0
Restructuring charges	7,543,000	0	7,941,000	0	100,000	500,000		8,000,000
Restructuring payments						500,000		400,000
Ending balance					$ 5,100,000	$ 5,100,000	$ 5,100,000	$ 7,600,000

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ACQUISITION - Narrative (Details) (USD $)	0 Months Ended	3 Months Ended		6 Months Ended			0 Months Ended			2 Months Ended	3 Months Ended	6 Months Ended								6 Months Ended
	Apr. 28, 2014	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013	Apr. 28, 2014	Jun. 25, 2014 Canadian Acquisition	Apr. 28, 2014 Canadian Acquisition mines	Dec. 24, 2013 Canadian Acquisition	Jun. 30, 2014 Canadian Acquisition	Jun. 30, 2014 Canadian Acquisition	Jun. 30, 2014 Canadian Acquisition mines T	Apr. 28, 2014 Canadian Acquisition	Dec. 31, 2013 Canadian Acquisition T	Jun. 30, 2014 Senior Notes	Apr. 28, 2014 Senior Notes Canadian Acquisition	Apr. 28, 2014 Term Debt Canadian Acquisition	Apr. 28, 2014 Revolving Credit Facility	Apr. 28, 2014 Revolving Credit Facility Canadian Acquisition	Jun. 30, 2014 Cost of Sales - Inventory Canadian Acquisition	Jun. 30, 2014 Selling and Administrative Costs Canadian Acquisition	Jun. 30, 2014 Foreign Exchange Canadian Acquisition	Jun. 30, 2014 Interest Expense Canadian Acquisition	Jun. 30, 2014 PMRU mines
Business Acquisition [Line Items]
Number of mines								6				6												5
Voting interests acquired (percent)													50.00%
Proven or probable coal reserves														649,000,000
Cash paid				$ 322,637,000	$ 0		$ 39,800,000	$ 282,800,000	$ 283,000,000		$ 322,600,000
Assumed liabilities						330,500,000							330,500,000
Aggregate principal amount															675,500,000	425,000,000
Stated interest rate (percent)															10.75%	10.75%	8.02%
Acquisition related costs												31,600,000								13,600,000	6,900,000	6,200,000	4,900,000
Maximum borrowing capacity																		60,000,000	60,000,000
Cash and cash equivalents						26,200,000
Payment of assumed liability	18,100,000
Net cash received upon acquisition						8,100,000
Revenues		287,956,000	162,499,000	468,159,000	323,947,000					116,000,000
Income (loss) from operations		$ (29,640,000)	$ 11,975,000	$ (21,588,000)	$ 17,710,000					$ (12,700,000)

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SUPPLEMENTAL CONSOLIDATING FINANCIAL INFORMATION - Supplemental Consolidating Balance Sheet Information (Detail) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013	Jun. 30, 2013	Dec. 31, 2012
Current assets:
Cash and cash equivalents	$ 40,610	$ 61,110	$ 36,274	$ 31,610
Receivables:
Trade	129,652	66,196
Loan and lease receivable	11,682	0
Contractual third-party reclamation receivables	7,940	8,487
Intercompany receivable/payable	0	0
Other	3,182	5,086
Total receivables	152,456	79,769
Inventories	153,154	39,972
Deferred income taxes	6,053	5,355
Restricted investments and bond collateral	0	5,998
Other current assets	12,362	12,835
Total current assets	364,635	205,039
Property, plant and equipment:
Land and mineral rights	439,001	278,188
Plant and equipment	832,337	657,696
Gross property, plant and equipment	1,271,338	935,884
Less accumulated depreciation, depletion and amortization	485,820	445,848
Net property, plant and equipment	785,518	490,036
Loan and lease receivable	85,344	0
Advanced coal royalties	7,134	7,311
Reclamation deposits	75,911	74,921
Restricted investments and bond collateral	104,511	69,235
Contractual third-party reclamation receivables	93,956	88,303
Investment in joint venture	33,273	0
Intangible assets	677	1,520
Investment in subsidiaries	0	0
Other assets	32,762	10,320
Total Assets	1,583,721	946,685	933,603
Current liabilities
Current installments of long-term debt	42,401	44,343
Accounts payable and accrued expenses:
Trade	128,338	57,507
Interest payable	30,750	11,321
Production taxes	42,673	41,905
Workers' compensation	707	717
Postretirement medical benefits	13,955	13,955
SERP	390	390
Deferred revenue	11,561	14,068
Asset retirement obligations	31,131	23,353	24,105
Other current liabilities	11,973	5,469
Total current liabilities	313,879	213,028
Long-term debt, less current installments	790,643	295,494
Workers' compensation, less current portion	6,629	6,744
Excess of black lung benefit obligation over trust assets	9,841	8,675
Postretirement medical benefits, less current portion	271,773	270,374
Pension and SERP obligations, less current portion	22,222	24,176
Deferred revenue, less current portion	40,676	46,567
Asset retirement obligations, less current portion	358,253	256,511	239,046
Intangible liabilities	5,072	5,606
Deferred income taxes	15,514	5,355
Other liabilities	9,864	2,034
Intercompany receivable/payable	0	0
Total liabilities	1,844,366	1,134,564
Shareholders' deficit:
Preferred stock	96	160
Common stock	38,173	36,479
Other paid-in capital	133,140	134,861
Accumulated other comprehensive loss	(53,615)	(63,595)
Accumulated earnings (deficit)	(378,439)	(295,784)
Total equity (deficit)	(260,645)	(187,879)
Total Liabilities and Shareholders' Deficit	1,583,721	946,685
Parent/ Issuer
Current assets:
Cash and cash equivalents	13,514	25,326	15,665	14,836
Receivables:
Trade	0	0
Loan and lease receivable	0
Contractual third-party reclamation receivables	0	0
Intercompany receivable/payable	132,824	(16,273)
Other	673	1,616
Total receivables	133,497	(14,657)
Inventories	0	0
Deferred income taxes	5,370	5,355
Restricted investments and bond collateral		0
Other current assets	972	789
Total current assets	153,353	16,813
Property, plant and equipment:
Land and mineral rights	0	0
Plant and equipment	4,022	3,973
Gross property, plant and equipment	4,022	3,973
Less accumulated depreciation, depletion and amortization	2,863	2,707
Net property, plant and equipment	1,159	1,266
Loan and lease receivable	0
Advanced coal royalties	0	0
Reclamation deposits	0	0
Restricted investments and bond collateral	63,322	15,134
Contractual third-party reclamation receivables	0	0
Investment in joint venture	0
Intangible assets	0	0
Investment in subsidiaries	480,871	280,843
Other assets	21,825	8,636
Total Assets	720,530	322,692
Current liabilities
Current installments of long-term debt	0	20,392
Accounts payable and accrued expenses:
Trade	5,240	6,840
Interest payable	30,315	11,302
Production taxes	0	0
Workers' compensation	707	717
Postretirement medical benefits	12,042	12,042
SERP	390	390
Deferred revenue	0	0
Asset retirement obligations	0	0
Other current liabilities	593	0
Total current liabilities	49,287	51,683
Long-term debt, less current installments	698,015	224,582
Workers' compensation, less current portion	6,629	6,744
Excess of black lung benefit obligation over trust assets	9,841	8,675
Postretirement medical benefits, less current portion	184,902	185,858
Pension and SERP obligations, less current portion	12,776	13,069
Deferred revenue, less current portion	0	0
Asset retirement obligations, less current portion	0	0
Intangible liabilities	0	0
Deferred income taxes	5,370	5,355
Other liabilities	707	584
Intercompany receivable/payable	13,648	14,021
Total liabilities	981,175	510,571
Shareholders' deficit:
Preferred stock	96	160
Common stock	38,173	36,479
Other paid-in capital	133,140	134,861
Accumulated other comprehensive loss	(53,615)	(63,595)
Accumulated earnings (deficit)	(378,439)	(295,784)
Total equity (deficit)	(260,645)	(187,879)
Total Liabilities and Shareholders' Deficit	720,530	322,692
Co-Issuer
Current assets:
Cash and cash equivalents	415	3,341	476	4,545
Receivables:
Trade	12,940	12,934
Loan and lease receivable	0
Contractual third-party reclamation receivables	0	0
Intercompany receivable/payable	32,639	0
Other	210	210
Total receivables	45,789	13,144
Inventories	5,319	6,161
Deferred income taxes	0	0
Restricted investments and bond collateral		5,998
Other current assets	335	143
Total current assets	51,858	28,787
Property, plant and equipment:
Land and mineral rights	1,395	1,395
Plant and equipment	221,350	220,872
Gross property, plant and equipment	222,745	222,267
Less accumulated depreciation, depletion and amortization	76,662	71,653
Net property, plant and equipment	146,083	150,614
Loan and lease receivable	0
Advanced coal royalties	0	0
Reclamation deposits	0	0
Restricted investments and bond collateral	0	0
Contractual third-party reclamation receivables	0	0
Investment in joint venture	0
Intangible assets	460	1,283
Investment in subsidiaries	0	0
Other assets	0	0
Total Assets	198,401	180,684
Current liabilities
Current installments of long-term debt	0	0
Accounts payable and accrued expenses:
Trade	7,996	10,119
Interest payable	0	0
Production taxes	1,081	3
Workers' compensation	0	0
Postretirement medical benefits	0	0
SERP	0	0
Deferred revenue	9,581	9,024
Asset retirement obligations	0	0
Other current liabilities	5,279	5,053
Total current liabilities	23,937	24,199
Long-term debt, less current installments	0	0
Workers' compensation, less current portion	0	0
Excess of black lung benefit obligation over trust assets	0	0
Postretirement medical benefits, less current portion	0	0
Pension and SERP obligations, less current portion	97	99
Deferred revenue, less current portion	35,949	41,297
Asset retirement obligations, less current portion	927	892
Intangible liabilities	5,072	5,606
Deferred income taxes	0	0
Other liabilities	5,790	0
Intercompany receivable/payable	0	0
Total liabilities	71,772	72,093
Shareholders' deficit:
Preferred stock	0	0
Common stock	5	5
Other paid-in capital	52,848	52,835
Accumulated other comprehensive loss	(160)	(164)
Accumulated earnings (deficit)	73,936	55,915
Total equity (deficit)	126,629	108,591
Total Liabilities and Shareholders' Deficit	198,401	180,684
Guarantor Subsidiaries
Current assets:
Cash and cash equivalents	24,440	27,451	16,416	10,237
Receivables:
Trade	116,712	46,985
Loan and lease receivable	11,682
Contractual third-party reclamation receivables	7,940	8,487
Intercompany receivable/payable	(146,187)	2,761
Other	2,294	3,256
Total receivables	(7,559)	61,489
Inventories	147,834	33,811
Deferred income taxes	683	870
Restricted investments and bond collateral		0
Other current assets	11,055	11,069
Total current assets	176,453	134,690
Property, plant and equipment:
Land and mineral rights	437,606	276,793
Plant and equipment	606,965	432,851
Gross property, plant and equipment	1,044,571	709,644
Less accumulated depreciation, depletion and amortization	406,295	371,488
Net property, plant and equipment	638,276	338,156
Loan and lease receivable	85,344
Advanced coal royalties	7,134	7,311
Reclamation deposits	75,911	74,921
Restricted investments and bond collateral	41,189	54,101
Contractual third-party reclamation receivables	93,956	88,303
Investment in joint venture	33,273
Intangible assets	217	237
Investment in subsidiaries	0	0
Other assets	10,937	1,683
Total Assets	1,162,690	699,402
Current liabilities
Current installments of long-term debt	42,401	23,951
Accounts payable and accrued expenses:
Trade	114,423	38,061
Interest payable	474	40
Production taxes	38,936	36,522
Workers' compensation	0	0
Postretirement medical benefits	773	774
SERP	0	0
Deferred revenue	1,980	5,044
Asset retirement obligations	31,131	23,353
Other current liabilities	6,102	417
Total current liabilities	236,220	128,162
Long-term debt, less current installments	96,128	72,912
Workers' compensation, less current portion	0	0
Excess of black lung benefit obligation over trust assets	0	0
Postretirement medical benefits, less current portion	68,766	66,439
Pension and SERP obligations, less current portion	9,110	10,765
Deferred revenue, less current portion	4,728	5,270
Asset retirement obligations, less current portion	357,326	255,619
Intangible liabilities	0	0
Deferred income taxes	10,144	0
Other liabilities	3,167	6,687
Intercompany receivable/payable	(13,849)	(7,851)
Total liabilities	771,740	538,003
Shareholders' deficit:
Preferred stock	0	0
Common stock	110	110
Other paid-in capital	441,269	157,984
Accumulated other comprehensive loss	16,075	6,425
Accumulated earnings (deficit)	(66,504)	(3,120)
Total equity (deficit)	390,950	161,399
Total Liabilities and Shareholders' Deficit	1,162,690	699,402
Non-Guarantor Subsidiaries
Current assets:
Cash and cash equivalents	2,241	4,992	3,717	1,992
Receivables:
Trade	0	6,277
Loan and lease receivable	0
Contractual third-party reclamation receivables	0	0
Intercompany receivable/payable	(19,275)	(19,353)
Other	45	28
Total receivables	(19,230)	(13,048)
Inventories	1	0
Deferred income taxes	0	0
Restricted investments and bond collateral		0
Other current assets	0	834
Total current assets	(16,988)	(7,222)
Property, plant and equipment:
Land and mineral rights	0	0
Plant and equipment	0	0
Gross property, plant and equipment	0	0
Less accumulated depreciation, depletion and amortization	0	0
Net property, plant and equipment	0	0
Loan and lease receivable	0
Advanced coal royalties	0	0
Reclamation deposits	0	0
Restricted investments and bond collateral	0	0
Contractual third-party reclamation receivables	0	0
Investment in joint venture	0
Intangible assets	0	0
Investment in subsidiaries	3,770	3,770
Other assets	3,500	2,000
Total Assets	(9,718)	(1,452)
Current liabilities
Current installments of long-term debt	0	0
Accounts payable and accrued expenses:
Trade	684	2,487
Interest payable	0	0
Production taxes	2,657	5,380
Workers' compensation	0	0
Postretirement medical benefits	1,139	1,139
SERP	0	0
Deferred revenue	0	0
Asset retirement obligations	0	0
Other current liabilities	0	0
Total current liabilities	4,480	9,006
Long-term debt, less current installments	0	0
Workers' compensation, less current portion	0	0
Excess of black lung benefit obligation over trust assets	0	0
Postretirement medical benefits, less current portion	18,105	18,077
Pension and SERP obligations, less current portion	239	243
Deferred revenue, less current portion	0	0
Asset retirement obligations, less current portion	0	0
Intangible liabilities	0	0
Deferred income taxes	0	0
Other liabilities	200	983
Intercompany receivable/payable	14,654	14,654
Total liabilities	37,678	42,963
Shareholders' deficit:
Preferred stock	0	0
Common stock	132	132
Other paid-in capital	(124)	(124)
Accumulated other comprehensive loss	(3,067)	(3,086)
Accumulated earnings (deficit)	(44,337)	(41,337)
Total equity (deficit)	(47,396)	(44,415)
Total Liabilities and Shareholders' Deficit	(9,718)	(1,452)
Consolidating Adjustments
Current assets:
Cash and cash equivalents	0	0	0	0
Receivables:
Trade	0	0
Loan and lease receivable	0
Contractual third-party reclamation receivables	0	0
Intercompany receivable/payable	(1)	32,865
Other	(40)	(24)
Total receivables	(41)	32,841
Inventories	0	0
Deferred income taxes	0	(870)
Restricted investments and bond collateral		0
Other current assets	0	0
Total current assets	(41)	31,971
Property, plant and equipment:
Land and mineral rights	0	0
Plant and equipment	0	0
Gross property, plant and equipment	0	0
Less accumulated depreciation, depletion and amortization	0	0
Net property, plant and equipment	0	0
Loan and lease receivable	0
Advanced coal royalties	0	0
Reclamation deposits	0	0
Restricted investments and bond collateral	0	0
Contractual third-party reclamation receivables	0	0
Investment in joint venture	0
Intangible assets	0	0
Investment in subsidiaries	(484,641)	(284,613)
Other assets	(3,500)	(1,999)
Total Assets	(488,182)	(254,641)
Current liabilities
Current installments of long-term debt	0	0
Accounts payable and accrued expenses:
Trade	(5)	0
Interest payable	(39)	(21)
Production taxes	(1)	0
Workers' compensation	0	0
Postretirement medical benefits	1	0
SERP	0	0
Deferred revenue	0	0
Asset retirement obligations	0	0
Other current liabilities	(1)	(1)
Total current liabilities	(45)	(22)
Long-term debt, less current installments	(3,500)	(2,000)
Workers' compensation, less current portion	0	0
Excess of black lung benefit obligation over trust assets	0	0
Postretirement medical benefits, less current portion	0	0
Pension and SERP obligations, less current portion	0	0
Deferred revenue, less current portion	(1)	0
Asset retirement obligations, less current portion	0	0
Intangible liabilities	0	0
Deferred income taxes	0	0
Other liabilities	0	(6,220)
Intercompany receivable/payable	(14,453)	(20,824)
Total liabilities	(17,999)	(29,066)
Shareholders' deficit:
Preferred stock	0	0
Common stock	(247)	(247)
Other paid-in capital	(493,993)	(210,695)
Accumulated other comprehensive loss	(12,848)	(3,175)
Accumulated earnings (deficit)	36,905	(11,458)
Total equity (deficit)	(470,183)	(225,575)
Total Liabilities and Shareholders' Deficit	$ (488,182)	$ (254,641)

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EARNINGS PER SHARE (Tables)

6 Months Ended

Jun. 30, 2014

Earnings Per Share [Abstract]

Antidilutive Securities Excluded from Computation of Earnings Per Share

The table below shows the number of shares that were excluded from the calculation of diluted loss per share because their inclusion would be anti-dilutive to the calculation:

	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2013		2014		2013
	(In thousands)
Convertible securities	$	654	$	1,093	$	654	$	1,093
Restricted stock units, stock options and SARs	674		862		674		862
Total shares excluded from diluted shares calculation	$	1,328	$	1,955	$	1,328	$	1,955

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LINES OF CREDIT AND LONG-TERM DEBT - Contractual Maturities of Long Term Debt (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Debt Disclosure [Abstract]
2014	$ 22,270
2015	41,290
2016	39,318
2017	25,776
2018	682,852
Thereafter	2,505
Total	814,011
Less: debt premium (discount), net	19,033
Total debt outstanding	$ 833,044	$ 339,837

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SHAREHOLDERS' EQUITY AND ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) - Additional Information (Detail) (USD $)	6 Months Ended		3 Months Ended	6 Months Ended	3 Months Ended	1 Months Ended	0 Months Ended	1 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014 Preferred Stock	Jun. 30, 2014 Preferred Stock	Jun. 30, 2014 Common Stock	Jul. 25, 2014 Subsequent Event Preferred Stock	Jul. 16, 2014 Subsequent Event Common Stock	Jul. 25, 2014 Subsequent Event Common Stock
Class of Stock [Line Items]
Cumulative dividends paid on Series A Convertible Exchangeable Preferred Stock (in USD per share)				$ 2.125
Preferred dividends paid	$ 470,000	$ 680,000
Shares converted			25,454			3,825
Conversion of convertible notes and securities, shares					173,885			26,133
Equity Offering
Stock issued (shares)							1,684,507
Shares issued, (in USD per share)							$ 35.50
Gross proceeds from issuance of common stock							$ 59,800,000

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ASSET RETIREMENT OBLIGATIONS, CONTRACTUAL THIRD-PARTY RECLAMATION RECEIVABLES, AND RECLAMATION DEPOSITS - Amortized Cost, Gross Unrealized Holding Gains and Losses and Fair Value of Held-to-Maturity Securities (Detail) (Reclamation Deposits, USD $) In Thousands, unless otherwise specified	Jun. 30, 2014
Reclamation Deposits
Schedule of Held-to-maturity Securities [Line Items]
Amortized cost	$ 31,822
Gross unrealized holding gains	953
Gross unrealized holding losses	(174)
Fair value	$ 32,601

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RESTRICTED INVESTMENTS AND BOND COLLATERAL - Carrying Value and Estimated Fair Value of Restricted Investments and Bond Collateral (Detail) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Investment [Line Items]
Restricted investments and bond collateral	$ 104,511	$ 69,235
Carrying Value
Investment [Line Items]
Cash and cash equivalents	67,340
Time deposits	2,451
Held-to-maturity securities	34,720
Restricted investments and bond collateral	104,511
Fair Value
Investment [Line Items]
Cash and cash equivalents	67,340
Time deposits	2,451
Held-to-maturity securities	35,259
Restricted investments and bond collateral	$ 105,050

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ACQUISITION ACQUISITION

6 Months Ended

Jun. 30, 2014

Business Combinations [Abstract]

ACQUISITION

ACQUISITION

On December 24, 2013, the Company entered into an agreement to acquire Sherritt International Corporation’s Prairie and Mountain coal mining operations, collectively referred to as the Canadian Acquisition. On April 28, 2014, Westmoreland Coal Company consummated the Canadian Acquisition. These operations, referred to as the Canadian operations, include six producing thermal coal mines in the Canadian provinces of Alberta and Saskatchewan, a char production facility, and a 50% interest in an activated carbon plant. The Canadian properties include approximately 649 million tons of total proven or probable coal reserves as of December 31, 2013. The purchase consideration included a $282.8 million initial cash payment made on April 28, 2014, a cash payment for a working capital adjustment of $39.8 million made on June 25, 2014, and assumed liabilities of $330.5 million.

In connection with the Canadian Acquisition: (i) proceeds from a private offering of $425.0 million in aggregate principal amount of 10.75% senior secured notes, or the New Notes, were released from escrow and such notes were automatically exchanged for identical notes issued by Westmoreland and Westmoreland Partners, as co-issuers; (ii) Westmoreland increased its revolving line of credit to $60.0 million; and (iii) Westmoreland Mining LLC, or WML; a wholly owned subsidiary of Westmoreland, provided prepayment notices to holders of its 8.02% senior secured notes due 2018, which notes were prepaid at the end of May 2014. Acquisition related costs of $31.6 million have been expensed for the six months ended June 30, 2014; which includes a $13.6 million charge to cost of sales related to the sale of inventory written up to fair value in the acquisition, $6.9 million of expenses included in Selling and administrative costs, $6.2 million of loss on foreign exchange as described in Note 10, and $4.9 million included in Interest expense related to a bridge facility commitment fee.

The Canadian Acquisition has been accounted for under the acquisition method of accounting that requires the total purchase consideration to be allocated to the assets acquired and liabilities assumed based on estimates of fair value.

The allocation of the purchase price is preliminary pending the completion of various analyses and the finalization of estimates. During the measurement period (which is not to exceed one year from the acquisition date), additional assets or liabilities may be recognized if new information is obtained about facts and circumstances that existed as of the acquisition date that, if known, would have resulted in the recognition of those assets or liabilities as of that date. The preliminary allocation may be adjusted after obtaining additional information regarding, among other things, asset valuations, liabilities assumed and revisions of previous estimates. These adjustments may be significant and will be accounted for retrospectively.

A summary of the purchase consideration and a preliminary allocation of the purchase consideration follows (in millions):

Purchase Price:
Cash paid - Initial payment	$	282.8
Cash paid - Working capital adjustment	39.8
Total cash consideration	$	322.6
Preliminary allocation of purchase price:
Assets:
Cash and cash equivalents	$	26.2
Trade receivables	49.9
Inventories - materials and supplies	52.0
Inventories - coal	79.8
Leases and loans receivable	11.2
Deferred tax assets	6.7
Other current assets	3.4
Total current assets	229.2
Land and mineral rights	151.3
Plant and equipment	171.7
Leases and loans receivable	83.8
Contractual third-party reclamation receivables, less current portion	6.8
Other assets	10.3
Total Assets	653.1
Liabilities:
Current installments of long-term debt	(36.3		)
Trade payables and other accrued liabilities	(93.7		)
Asset retirement obligations	(9.7		)
Total current liabilities	(139.7		)
Long-term debt, less current installments	(86.3		)
Asset retirement obligations, less current portion	(92.4		)
Deferred tax liabilities	(12.1		)
Total Liabilities	(330.5		)
Net fair value	$	322.6

The $26.2 million of cash and cash equivalents noted above includes $18.1 million which was used for immediate payment of an assumed liability on the acquisition date, leaving $8.1 million of net cash received upon the acquisition.

The results of operations of the Canadian operations from the acquisition date of April 28, 2014 have been included in the Company's consolidated results of operations for the three and six months ended June 30, 2014. The Canadian operations generated $116.0 million of revenue and $12.7 millionof operating loss since the April 28, 2014 acquisition date.

The following unaudited pro forma information has been prepared for illustrative purposes only and assumes the acquisition occurred on January 1, 2013. The unaudited pro forma results have been prepared based on estimates and assumptions, which the Company believes are reasonable, however, they are not necessarily indicative of the consolidated results of operations had the acquisition occurred on January 1, 2013, or of future results of operations.

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
Total Revenues	(In thousands, except per share data)
As reported	$	287,956		$	162,499		$	468,159		$	323,947
Pro forma	$	320,761		$	356,962		$	674,378		$	672,735
Operating Income
As reported	$	(29,640	)	$	11,975		$	(21,588	)	$	17,710
Pro forma	$	(50,032	)	$	17,081		$	(14,433	)	$	30,105
Net loss applicable to common shareholders
As reported	$	(63,363	)	$	(622	)	$	(82,655	)	$	(3,347	)
Pro forma	$	(89,247	)	$	(4,167	)	$	(97,509	)	$	(9,131	)
Net loss per share applicable to common shareholders
As reported	$	(4.19	)	$	(0.04	)	$	(5.52	)	$	(0.23	)
Pro forma	$	(5.90	)	$	(0.29	)	$	(6.52	)	$	(0.63	)

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ASSET RETIREMENT OBLIGATIONS, CONTRACTUAL THIRD-PARTY RECLAMATION RECEIVABLES, AND RECLAMATION DEPOSITS - Maturities of Held-to-Maturity Securities (Detail) (Reclamation Deposits, USD $) In Thousands, unless otherwise specified	Jun. 30, 2014
Reclamation Deposits
Schedule of Held-to-maturity Securities [Line Items]
Within one year, Amortized cost	$ 1,025
Due in five years or less, Amortized cost	17,341
Due after five years to ten years, Amortized cost	7,289
Due in more than ten years, Amortized cost	6,167
Maturities of held-to-maturity securities, Amortized cost	31,822
Within one year, Fair Value	998
Due in five years or less, Fair Value	17,829
Due after five years to ten years, Fair Value	7,424
Due in more than ten years, Fair Value	6,350
Fair value	$ 32,601

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ACQUISITION - Summary of purchase consideration and allocation of purchase consideration (Details) (USD $)	6 Months Ended			0 Months Ended			3 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Apr. 28, 2014	Jun. 25, 2014 Canadian Acquisition	Apr. 28, 2014 Canadian Acquisition	Dec. 24, 2013 Canadian Acquisition	Jun. 30, 2014 Canadian Acquisition	Apr. 28, 2014 Canadian Acquisition
Purchase Price:
Cash paid	$ 322,637,000	$ 0		$ 39,800,000	$ 282,800,000	$ 283,000,000	$ 322,600,000
Assets:
Cash and cash equivalents			26,200,000
Trade receivables			49,900,000
Inventories - materials and supplies			52,000,000
Inventories - coal			79,800,000
Leases and loans receivable			11,200,000
Deferred tax assets			6,700,000
Other current assets			3,400,000
Total current assets			229,200,000
Land and mineral rights			151,300,000
Plant and equipment			171,700,000
Leases and loans receivable			83,800,000
Contractual third-party reclamation receivables, less current portion			6,800,000
Other assets			10,300,000
Total Assets			653,100,000
Liabilities:
Current installments of long-term debt			(36,300,000)
Asset retirement obligations			(93,700,000)
Asset retirement obligations			(9,700,000)
Total current liabilities			(139,700,000)
Long-term debt, less current installments			(86,300,000)
Asset retirement obligations, less current portion			(92,400,000)
Deferred tax liabilities			(12,100,000)
Total Liabilities			(330,500,000)					(330,500,000)
Net fair value			$ 322,600,000

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LINES OF CREDIT AND LONG-TERM DEBT (Tables)

6 Months Ended

Jun. 30, 2014

Debt Disclosure [Abstract]

Outstanding lines of credit and long-term debt

The amounts outstanding under the Company’s debt consisted of the following as of the dates indicated:

	Total Debt Outstanding
	June 30, 2014			December 31, 2013
	(In thousands)
10.75% Senior Notes due 2018	$	250,485		$	251,500
Add-On Notes - 10.75% senior notes due 2018	425,000			—
8.02% WML term debt due 2018	—			85,500
Capital lease obligations	133,240			10,153
Other	5,286			1,209
Debt premium (discount), net	19,033			(8,525		)
Total debt outstanding	833,044			339,837
Less current installments	(42,401		)	(44,343		)
Total debt outstanding, less current installments	$	790,643		$	295,494

Contractual maturities of all long-term debt

The following table presents aggregate contractual debt maturities of all debt:

	As of June 30, 2014
	(In thousands)
2014	$	22,270
2015	41,290
2016	39,318
2017	25,776
2018	682,852
Thereafter	2,505
Total	814,011
Plus: debt premium (discount), net	19,033
Total debt	$	833,044

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RESTRUCTURING CHARGES (Tables)

6 Months Ended

Jun. 30, 2014

ROVA I and ROVA II Contracts

Restructuring Cost and Reserve [Line Items]

Restructuring and Related Costs

The table below represents the restructuring provision activity related to the ROVA restructuring affecting our Power segment during the six months ended June 30, 2014 (in millions):

Beginning Balance		Restructuring Charges		Restructuring Payments		Ending Balance
$	5.1	$	0.5	$	0.5	$	5.1

Canadian Acquisition

Restructuring Cost and Reserve [Line Items]

Restructuring and Related Costs

The table below represents the restructuring provision activity related to the Canadian Acquisition affecting our Coal - Canada and Coal - US segments during the six months ended June 30, 2014 (in millions):

Beginning Balance		Restructuring Charges		Restructuring Payments		Ending Balance
$	—	$	8.0	$	0.4	$	7.6

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POSTRETIREMENT MEDICAL BENEFITS AND PENSION - Pension Benefit Disclosures (Details) (Pension, USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Pension
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Service cost	$ 500,000	$ 638,000	$ 1,000,000	$ 1,173,000
Interest cost	1,638,000	1,555,000	3,384,000	3,180,000
Expected return on plan assets	(2,154,000)	(2,325,000)	(4,307,000)	(4,385,000)
Amortization of deferred items	359,000	1,004,000	719,000	1,745,000
Total net periodic benefit cost	343,000	872,000	796,000	1,713,000
Cash contributions during the period			1,100,000
Expected contributions during the remainder of 2014			$ 3,200,000

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ACQUISITION - Summary of Pro Forma Information (Details) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Total Revenues
As reported	$ 287,956	$ 162,499	$ 468,159	$ 323,947
Pro forma	320,761	356,962	674,378	672,735
Operating Income
As reported	(29,640)	11,975	(21,588)	17,710
Pro forma	(50,032)	17,081	(14,433)	30,105
Net loss applicable to common shareholders
As reported	(63,363)	(622)	(82,655)	(3,347)
Pro forma	$ (89,247)	$ (4,167)	$ (97,509)	$ (9,131)
Net loss per share applicable to common shareholders
As reported (in USD per share)	$ (4.19)	$ (0.04)	$ (5.52)	$ (0.23)
Pro forma (in USD per share)	$ (5.90)	$ (0.29)	$ (6.52)	$ (0.63)

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POSTRETIREMENT MEDICAL BENEFITS AND PENSION (Tables)

6 Months Ended

Jun. 30, 2014

Postretirement Medical Benefits

Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]

Components of net periodic benefit cost

The components of net periodic postretirement medical benefit cost are as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2013		2014		2013
	(In thousands)				(In thousands)
Components of net periodic benefit cost:
Service cost	$	822	$	1,109	$	1,645	$	2,218
Interest cost	3,203		3,035		6,407		6,069
Amortization of deferred items	4		1,001		9		2,003
Total net periodic benefit cost	$	4,029	$	5,145	$	8,061	$	10,290

The following table shows the net periodic postretirement medical benefit costs that relate to current and former mining operations:

	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2013		2014		2013
	(In thousands)				(In thousands)
Former mining operations	$	2,402	$	3,119	$	4,807	$	6,237
Current operations	1,627		2,026		3,254		4,053
Total net periodic benefit cost	$	4,029	$	5,145	$	8,061	$	10,290

Pension

Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]

Components of net periodic benefit cost

The Company incurred net periodic benefit costs of providing these pension benefits as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
	(In thousands)						(In thousands)
Components of net periodic benefit cost:
Service cost	$	500		$	638		$	1,000		$	1,173
Interest cost	1,638			1,555			3,384			3,180
Expected return on plan assets	(2,154		)	(2,325		)	(4,307		)	(4,385		)
Amortization of deferred items	359			1,004			719			1,745
Total net periodic pension cost	$	343		$	872		$	796		$	1,713

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HERITAGE HEALTH BENEFIT EXPENSES (Tables)

6 Months Ended

Jun. 30, 2014

Heritage Health Benefit Expenses [Abstract]

Components of costs of benefits to former mining operation employees

The components of these expenses are as follows:

	Three Months Ended June 30,					Six Months Ended June 30,
	2014		2013			2014		2013
	(In thousands)					(In thousands)
Health care benefits	$	2,376	$	3,089		$	4,650	$	6,266
Combined benefit fund payments	512		576			1,025		1,152
Workers’ compensation benefits	124		117			260		232
Black lung benefits	376		(673		)	997		(590		)
Total	$	3,388	$	3,109		$	6,932	$	7,060

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BASIS OF PRESENTATION

6 Months Ended

Jun. 30, 2014

Accounting Policies [Abstract]

BASIS OF PRESENTATION

BASIS OF PRESENTATION

The accompanying unaudited consolidated financial statements include accounts of Westmoreland Coal Company, or the Company, or Parent, and its subsidiaries and controlled entities. The Company’s current principal activities are conducted within the United States and Canada. U.S. activities include the production and sale of coal from its mines in Montana, Wyoming, North Dakota and Texas, and the ownership of the Roanoke Valley power plants, or ROVA, in North Carolina. Canadian activities include the production and sale of coal from six surface mines in Alberta and Saskatchewan, selling char to the barbecue briquette industry, and a 50% interest in a joint venture which produces activated carbon for the removal of flue gas. The Company’s activities are primarily conducted through wholly owned subsidiaries. All intercompany transactions and accounts have been eliminated in consolidation.

U.S. Operations – The Company’s Kemmerer Mine is owned by its subsidiary Westmoreland Kemmerer, Inc., or Kemmerer. The Company’s Absaloka Mine is owned by its subsidiary Westmoreland Resources, Inc., or WRI. The Beulah, Jewett, Rosebud, and Savage Mines are owned through the Company’s subsidiary Westmoreland Mining LLC, or WML.

Canadian Operations – Prairie Mines & Royalty ULC, or PMRU, operates five surface coal mines in Alberta and Saskatchewan. PMRU owns and operates the Paintearth, Sheerness, Genesee, Poplar River and Estevan mines. PMRU directly owns a 50% joint venture interest in the Bienfait Activated Carbon Joint Venture, at the Estevan mine, which produces activated carbon for the removal of mercury from flue gas. PMRU also sells char to the barbecue briquette industry. Coal Valley Resources Inc., or CVRI, operates the Coal Valley Mine which is a surface mine located in West Central Alberta where the majority of coal is exported overseas to Asian utility companies and commodity traders. CVRI operated the Obed Mountain surface mine, which ceased production in 2013 and is currently in reclamation.

The consolidated financial statements of the Company have been prepared in accordance with United States generally accepted accounting principles and require use of management’s estimates. The financial information contained in this Form 10-Q is unaudited, but reflects all adjustments, which are, in the opinion of management, necessary for a fair presentation of the financial information for the periods shown. Such adjustments are of a normal recurring nature. The results of operations for the six months ended June 30, 2014 are not necessarily indicative of results to be expected for the year ending December 31, 2014.

These quarterly consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2013, or the 2013 Form 10-K. The accounting principles followed by the Company are set forth in the Notes to the Company’s consolidated financial statements in its 2013 Form 10-K. Most of the descriptions of the accounting principles and other footnote disclosures previously made have been omitted in this report so long as the interim information presented is not misleading or inconsistent.

Debt Obligations

The Company is subject to one major debt arrangement of $675.5 million in aggregate principal amount of 10.75% senior secured notes at the Parent level that are collateralized by substantially all of the assets of the Company.

Business Interruption Insurance

The Company received business interruption insurance proceeds for the six months ended June 30, 2014 due to an explosion and subsequent fire at a customer’s facility that occurred in November 2011. Operations at that facility resumed during October 2013. The Company recognizes income as business interruption losses are incurred and reimbursement is virtually assured. The Company reports this income in Other operating income and recognized nil and $11.3 million of income for the six months ended June 30, 2014 and 2013, respectively. The Company received $4.6 million of cash proceeds for the six months ended June 30, 2014 related to income recorded in 2013. Insurance proceeds are included in Net cash provided by operating activities. As of June 30, 2014, the Company has collected all cash proceeds related to income recognized.

Inventories

Inventories, which include materials and supplies as well as raw coal, are stated at the lower of cost or market. Cost is determined using the average cost method. Coal inventory costs include labor, supplies, equipment, depreciation, depletion, amortization, operating overhead and other related costs.

Derivatives

The Company enters into financial derivatives to manage exposure to fluctuations in foreign currency exchange rates and power prices. The Company does not utilize derivative financial instruments for trading purposes or for speculative purposes.

The Company’s derivative instruments are recorded at fair value with changes in fair value recognized in the Consolidated Statements of Operations at the end of each period in Gain (loss) on foreign exchange or Derivative loss.

Equity-Method Investments

The Company's 50% interest in the Bienfait Activated Carbon Joint Venture is accounted for under the equity method of accounting. Investments in unconsolidated affiliates that the Company has the ability to exercise significant influence over, but not control, are accounted for under the equity method of accounting. Under the equity method of accounting, the Company records its proportionate share of the entity’s net income or loss at each reporting period in Income from equity affiliates on the Consolidated Statements of Operations with a corresponding entry to increase or decrease the carrying value of the investment.

Loan and Lease Receivable

The Company periodically makes loans and finance leases at the Genesee mine in accordance with its operating agreement with its only customer for purposes of funding capital expenditures and working capital requirements. Finance lease and loan receivables are measured at the present value of the future lease payments at the inception of the arrangement. Lease payments received are comprised of a repayment of principal and finance income. Finance income is recognized based on the interest rate implicit in the finance lease. PMRU recognizes finance income over periods between 3 and 27 years, which reflect a constant periodic return on its net investment in the finance lease. Initial direct costs are included in the initial measurement of the finance lease receivable and reduce the amount of income recognized over the lease term.

Income Taxes

The Company’s effective tax rate in the six months ended June 30, 2014, was lower than the effective tax rate in the six months ended June 30, 2013, primarily due to the forecasted 2014 decrease in pre-tax loss and the related income tax expense from the Canadian Acquisition.

For the six months ended June 30, 2014, the Company’s effective tax rate differs from the statutory rate primarily due to the U.S. valuation allowance and foreign operations. For the six months ended June 30, 2013, the Company’s effective tax rate differs from the statutory rate primarily due to the U.S. valuation allowance.

The Company has recorded a $5.8 million liability for unrecognized tax benefits at June 30, 2014 with no liability recorded at December 31, 2013. This liability relates to the utilization of prior losses and is currently under review by taxing authorities. It is reasonably possible that the liability for unrecognized tax benefits will significantly change in the next twelve months upon the taxing authorities concluding the review.

Foreign Currency Translation

The functional currency of the Company’s Canadian operations is the Canadian dollar. The Company’s Canadian operations’ assets and liabilities are translated at period end exchange rates, and revenues and costs are translated using average exchange rates for the period. Foreign currency translation adjustments are reported in Other comprehensive income.

Reclassifications

Certain amounts in prior periods have been reclassified to conform with the presentation of 2014, with no effect on

previously reported net loss, cash flows or shareholders’ deficit. The reclassification affected current assets, current liabilities and noncurrent liabilities on the Consolidated Balance Sheet.

Recently Adopted Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2014-09, Revenue from Contracts with Customers, issued as a new Topic, Accounting Standards Codification (ASC) Topic 606. The new revenue recognition standard provides a five-step analysis of transactions to determine when and how revenue is recognized. The core principle of the guidance is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This ASU is effective beginning in fiscal 2017 and can be adopted by the Company either retrospectively or as a cumulative-effect adjustment as of the date of adoption. The Company is currently evaluating the effect that adopting this new accounting guidance will have on its consolidated results of operations, cash flows and financial position.

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ASSET RETIREMENT OBLIGATIONS, CONTRACTUAL THIRD-PARTY RECLAMATION RECEIVABLES, AND RECLAMATION DEPOSITS (Tables)

6 Months Ended

Jun. 30, 2014

Asset Retirement Obligation Disclosure [Abstract]

Summary of asset retirement obligations, contractual third-party reclamation receivables and reclamation deposits

The asset retirement obligation, contractual third-party reclamation receivable, and reclamation deposits for each of the Company’s operating segments at June 30, 2014 are summarized below:

	Asset Retirement Obligation		Contractual Third-Party Reclamation Receivable		Reclamation Deposits
	(In thousands)
Coal - U.S.	$	281,346	$	95,157	$	75,911
Coal - Canada	107,111		6,739		—
Power	927		—		—
Total	$	389,384	$	101,896	$	75,911

Changes in Company's asset retirement obligations

Changes in the Company’s asset retirement obligations were as follows:

	Six Months Ended June 30,
	2014			2013
	(In thousands)
Asset retirement obligations, beginning of year (including current portion)	$	279,864		$	263,847
Accretion	14,003			10,951
Liabilities settled	(10,250		)	(11,647		)
ARO acquired	102,075			—
Changes due to foreign currency translation	3,692			—
Asset retirement obligations, end of period	389,384			263,151
Less current portion	(31,131		)	(24,105		)
Asset retirement obligations, less current portion	$	358,253		$	239,046

Carrying value and estimated fair value of reclamation deposits

The Company’s carrying value and estimated fair value of its reclamation deposits at June 30, 2014 are as follows:

	Carrying Value		Fair Value		Fair Value Hierarchy
	(In thousands)
Cash and cash equivalents	$	44,089	$	44,089	Level 1
Held-to-maturity securities	31,822		32,601		Level 2
	$	75,911	$	76,690

Amortized cost, gross unrealized holding gains and losses and fair value of held-to-maturity securities

The amortized cost, gross unrealized holding gains and losses and fair value of held-to-maturity securities at June 30, 2014 are as follows (in thousands):

Amortized cost	$	31,822
Gross unrealized holding gains	953
Gross unrealized holding losses	(174		)
Fair value	$	32,601

Reclamation Deposits

Schedule of Held-to-maturity Securities [Line Items]

Schedule of maturities of held-to-maturity investments

Maturities of held-to-maturity securities are as follows at June 30, 2014:

	Amortized Cost		Fair Value
	(In thousands)
Within one year	$	1,025	$	998
Due in five years or less	17,341		17,829
Due after five years to ten years	7,289		7,424
Due in more than ten years	6,167		6,350
	$	31,822	$	32,601

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BASIS OF PRESENTATION - Business Operations (Details)	0 Months Ended	6 Months Ended
	Apr. 28, 2014 mines	Jun. 30, 2014 mines
Canadian Acquisition
Business Acquisition [Line Items]
Number of mines	6	6
PMRU
Business Acquisition [Line Items]
Number of mines		5
Corporate Joint Venture [Member] | Canadian Acquisition
Business Acquisition [Line Items]
Ownership percentage in joint venture		50.00%
Corporate Joint Venture [Member] | PMRU
Business Acquisition [Line Items]
Ownership percentage in joint venture		50.00%

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LINES OF CREDIT AND LONG-TERM DEBT - Additional Information (Detail) (USD $)	0 Months Ended	6 Months Ended			6 Months Ended	0 Months Ended			3 Months Ended							0 Months Ended	3 Months Ended	6 Months Ended	12 Months Ended
	Dec. 24, 2013	Jun. 30, 2014	Jun. 30, 2013	Dec. 31, 2013	Jun. 30, 2014 Senior Notes	Jun. 25, 2014 Canadian Acquisition	Apr. 28, 2014 Canadian Acquisition	Dec. 24, 2013 Canadian Acquisition	Jun. 30, 2014 Canadian Acquisition	Apr. 28, 2014 Canadian Acquisition Senior Notes	Jun. 30, 2014 Kemmerer Mine	Apr. 28, 2014 Revolving Credit Facility	Apr. 28, 2014 Revolving Credit Facility Canadian Acquisition	Apr. 28, 2014 Subfacility for Letters of Credit	Jun. 30, 2014 Add On Notes - Senior Notes due 2018 Senior Notes	Feb. 07, 2014 Senior Notes due 2018 Senior Notes	Jun. 30, 2014 Senior Notes due 2018 Senior Notes	Jun. 30, 2014 Senior Notes due 2018 Senior Notes	Dec. 31, 2013 Senior Notes due 2018 Senior Notes
Debt Instrument [Line Items]
Aggregate principal amount					$ 675,500,000					$ 425,000,000					$ 425,000,000	$ 425,000,000
Stated interest rate (percent)					10.75%					10.75%					10.75%	10.75%	10.75%	10.75%	10.75%
Debt instrument price as percentage of face value																106.875%
Proceeds from issuance of debt																454,200,000
Debt premium																29,200,000
Cash paid		322,637,000	0			39,800,000	282,800,000	283,000,000	322,600,000
Transaction costs for acquisition and note offering	24,000,000
Maximum borrowing capacity												60,000,000	60,000,000	60,000,000
Debt issuance costs capitalized		15,400,000
Debt repurchased					1,000,000
Principal amount of senior notes repurchased					1,000,000
Loss on restructuring of debt					(100,000)
Excess cash flow																			29,500,000
Excess cash flow offered for repurchase of debt																	22,100,000
Current installments of long-term debt		42,401,000		44,343,000															22,100,000
Repayments of debt																		1,000,000
Redemption price as percentage of face value of debt																		100.00%
Long-term debt, less current installments		790,643,000		295,494,000													21,100,000	21,100,000
Capital lease obligations											$ 12,900,000

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EARNINGS PER SHARE - Antidilutive securities excluded from the computation of earnings per share (Details) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Class of Stock [Line Items]
Shares excluded from diluted shares calculation	1,328	1,955	1,328	1,955
Convertible securities
Class of Stock [Line Items]
Shares excluded from diluted shares calculation	654	1,093	654	1,093
Restricted stock units, stock options and SARs
Class of Stock [Line Items]
Shares excluded from diluted shares calculation	674	862	674	862

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Consolidated Balance Sheets (Unaudited) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Current assets:
Cash and cash equivalents	$ 40,610	$ 61,110
Receivables:
Trade	129,652	66,196
Loan and lease receivable	11,682	0
Contractual third-party reclamation receivables	7,940	8,487
Other	3,182	5,086
Total receivables	152,456	79,769
Inventories	153,154	39,972
Deferred income taxes	6,053	5,355
Restricted investments and bond collateral	0	5,998
Other current assets	12,362	12,835
Total current assets	364,635	205,039
Property, plant and equipment:
Land and mineral rights	439,001	278,188
Plant and equipment	832,337	657,696
Gross property, plant and equipment	1,271,338	935,884
Less accumulated depreciation, depletion and amortization	485,820	445,848
Net property, plant and equipment	785,518	490,036
Loan and lease receivable	85,344	0
Advanced coal royalties	7,134	7,311
Reclamation deposits	75,911	74,921
Restricted investments and bond collateral	104,511	69,235
Contractual third-party reclamation receivables, less current portion	93,956	88,303
Investment in joint venture	33,273	0
Intangible assets, net of accumulated amortization of $14.9 million and $14.1 million at June 30, 2014 and December 31, 2013, respectively	677	1,520
Other assets	32,762	10,320
Total Assets	1,583,721	946,685
Current liabilities:
Current installments of long-term debt	42,401	44,343
Accounts payable and accrued expenses:
Trade	128,338	57,507
Interest payable	30,750	11,321
Production taxes	42,673	41,905
Workers' compensation	707	717
Postretirement medical benefits	13,955	13,955
SERP	390	390
Deferred revenue	11,561	14,068
Asset retirement obligations	31,131	23,353
Other current liabilities	11,973	5,469
Total current liabilities	313,879	213,028
Long-term debt, less current installments	790,643	295,494
Workers' compensation, less current portion	6,629	6,744
Excess of black lung benefit obligation over trust assets	9,841	8,675
Postretirement medical benefits, less current portion	271,773	270,374
Pension and SERP obligations, less current portion	22,222	24,176
Deferred revenue, less current portion	40,676	46,567
Asset retirement obligations, less current portion	358,253	256,511
Intangible liabilities, net of accumulated amortization of $13.0 million and $12.4 million at June 30, 2014 and December 31, 2013, respectively	5,072	5,606
Deferred income taxes	15,514	5,355
Other liabilities	9,864	2,034
Total liabilities	1,844,366	1,134,564
Shareholders' deficit:
Preferred stock of $1.00 par value Authorized 5,000,000 shares; Issued and outstanding 112,994 shares at June 30, 2014 and 159,960 at December 31, 2013	96	160
Common stock of $2.50 par value Authorized 30,000,000 shares; Issued and outstanding 15,075,153 shares at June 30, 2014 and 14,592,231 shares at December 31, 2013	38,173	36,479
Other paid-in capital	133,140	134,861
Accumulated other comprehensive loss	(53,615)	(63,595)
Accumulated deficit	(378,439)	(295,784)
Total shareholders’ deficit	(260,645)	(187,879)
Total Liabilities and Shareholders' Deficit	$ 1,583,721	$ 946,685

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INVENTORIES (Detail) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Inventory Disclosure [Abstract]
Coal stockpiles	$ 61,663	$ 543
Coal fuel inventories	5,319	6,161
Materials and supplies	86,946	34,233
Reserve for obsolete inventory	(774)	(965)
Total	$ 153,154	$ 39,972

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Consolidated Statements of Shareholders' Deficit (Unaudited) (USD $) In Thousands, except Share data	Total	Preferred Stock	Common Stock	Other Paid-in Capital	Accumulated Other Comprehensive Loss	Accumulated Deficit
Beginning balance at Dec. 31, 2013	$ (187,879)	$ 160	$ 36,479	$ 134,861	$ (63,595)	$ (295,784)
Beginning balance, shares at Dec. 31, 2013		159,960	14,592,231
Preferred dividends declared	(470)					(470)
Common stock issued as compensation	2,445		24	2,421
Common stock options exercised, shares			9,773
Common stock options exercised	193		23	170
Common stock issued as compensation, shares			9,000
SARs exercised	0		21	(21)
SARs exercised, shares			8,352
Conversion of convertible notes and securities	0	(64)	1,097	(1,033)
Conversion of convertible notes and securities, shares		(64,191)	438,526
Issuance of restricted stock, shares			211,755
Issuance of restricted stock	(2,729)		529	(3,258)
Net income (loss)	(82,185)					(82,185)
Other comprehensive income	9,980				9,980
Ending balance at Jun. 30, 2014	$ (260,645)	$ 96	$ 38,173	$ 133,140	$ (53,615)	$ (378,439)
Ending balance, shares at Jun. 30, 2014		95,769	15,269,637

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ASSET RETIREMENT OBLIGATIONS, CONTRACTUAL THIRD-PARTY RECLAMATION RECEIVABLES, AND RECLAMATION DEPOSITS - Changes in Company's Asset Retirement Obligations (Detail) (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Dec. 31, 2013
Asset Retirement Obligation Disclosure [Abstract]
Asset retirement obligations, beginning of period (including current portion)	$ 279,864	$ 263,847
Accretion	14,003	10,951
Liabilities settled	(10,250)	(11,647)
ARO acquired	102,075	0
Changes due to foreign currency translation	3,692	0
Asset retirement obligations, end of period	389,384	263,151
Less current portion	(31,131)	(24,105)	(23,353)
Asset retirement obligations, less current portion	$ 358,253	$ 239,046	$ 256,511

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SHAREHOLDERS' EQUITY AND ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Tables)

6 Months Ended

Jun. 30, 2014

Stockholders' Equity Note [Abstract]

Changes in Accumulated Other Comprehensive Income by component

The following table reflects the changes in accumulated other comprehensive income (loss) by component:

	Pension			Postretirement medical benefits			Foreign currency translation adjustment		Tax effect of other comprehensive income gains			Accumulated other comprehensive loss
	(In thousands)
Balance at December 31, 2013	$	(12,255	)	$	(20,292	)	$	—	$	(31,048	)	$	(63,595	)
Other comprehensive income (loss) before reclassifications	—			—			9,477		(224		)	9,253
Amounts reclassified from accumulated other comprehensive income (loss)	717			10			—		—			727
Balance at June 30, 2014	$	(11,538	)	$	(20,282	)	$	9,477	$	(31,272	)	$	(53,615	)

Reclassifications out of Accumulated Other Comprehensive Income for the period

The following table reflects the reclassifications out of accumulated other comprehensive loss for the six months ended June 30, 2014 are as follows (in thousands):

Details about accumulated other comprehensive loss components	Amount reclassified from accumulated other comprehensive loss1						Affected line item in the statement where net income (loss) is presented
	Three Months Ended June 30, 2014			Six Months Ended June 30, 2014
Amortization of defined benefit pension items
Actuarial losses	$	359		$	717		2
Amortization of postretirement medical items
Prior service costs	$	(159	)	$	(318	)	3
Actuarial losses	164			328			3
Total	$	5		$	10

____________________

(1) Amounts in parentheses indicate debits to income/loss.

(2) These accumulated other comprehensive loss components are included in the computation of net periodic pension cost. (See Note 7 - Pension for additional details)

(3) These accumulated other comprehensive loss components are included in the computation of net periodic postretirement medical cost. (See Note 7 - Postretirement Medical Benefits for additional details)

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SHAREHOLDERS' EQUITY AND ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) - Changes in Accumulated Other Comprehensive Income by component (Details) (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2014
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance at beginning of period	$ (63,595)
Other comprehensive income before reclassifications	9,253
Amounts reclassified from accumulated other comprehensive income (loss)	727
Balance at end of period	(53,615)
Defined benefit plans adjustment | Pension
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance at beginning of period	(12,255)
Amounts reclassified from accumulated other comprehensive income (loss)	717
Balance at end of period	(11,538)
Defined benefit plans adjustment | Postretirement Medical Benefits
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance at beginning of period	(20,292)
Amounts reclassified from accumulated other comprehensive income (loss)	10
Balance at end of period	(20,282)
Foreign currency translation adjustment
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance at beginning of period	0
Other comprehensive income before reclassifications	9,477
Balance at end of period	9,477
Tax effect of other comprehensive income gains
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance at beginning of period	(31,048)
Other comprehensive income before reclassifications	(224)
Balance at end of period	$ (31,272)

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BUSINESS SEGMENT INFORMATION

6 Months Ended

Jun. 30, 2014

Segment Reporting [Abstract]

BUSINESS SEGMENT INFORMATION

BUSINESS SEGMENT INFORMATION

Segment information is based on a management approach, which requires segmentation based upon the Company’s internal organization, reporting of revenue, and operating income.

The Company’s operations are classified into five reporting segments: Coal - U.S., Coal - Canada, Power, Heritage and Corporate. The Canadian Acquisition was completed on April 28, 2014 and the segment "Coal - Canada" has not been previously presented. The business segment information for the Company's U.S. coal operations was previously reported in the "Coal" segment in the 2013 Form 10-K since the Company previously only held coal operations in the U.S.

Summarized financial information by segment is as follows:

	Coal - U.S.			Coal - Canada(1)			Power			Heritage			Corporate			Consolidated
	(In thousands)
Three Months Ended June 30, 2014
Revenues	$	150,107		$	116,046		$	21,803		$	—		$	—		$	287,956
Restructuring charges	491			6,646			101			—			305			7,543
Depreciation, depletion, and amortization	13,283			8,671			2,486			—			39			24,479
Operating income (loss)	(423		)	(12,709		)	(9,473		)	(3,559		)	(3,476		)	(29,640		)
Total assets	670,375			687,185			165,763			15,664			44,734			1,583,721
Capital expenditures	6,533			7,495			220			—			63			14,311
Three Months Ended June 30, 2013
Revenues	$	139,337		$	—		$	23,162		$	—		$	—		$	162,499
Depreciation, depletion, and amortization	12,804			—			2,551			—			42			15,397
Operating income (loss)	12,572			—			4,837			(3,530		)	(1,904		)	11,975
Total assets	699,556			—			183,855			16,305			33,887			933,603
Capital expenditures	7,209			—			564			—			393			8,166
Six Months Ended June 30, 2014
Revenues	$	308,298		$	116,046		$	43,815		$	—		$	—		$	468,159
Restructuring charges	491			6,646			499			—			305			7,941
Depreciation, depletion, and amortization	26,780			8,671			5,009			—			78			40,538
Operating income (loss)	12,275			(12,709		)	(7,731		)	(7,389		)	(6,034		)	(21,588		)
Total assets	670,375			687,185			165,763			15,664			44,734			1,583,721
Capital expenditures	9,586			7,495			255			—			25			17,361
Six Months Ended June 30, 2013
Revenues	$	281,449		$	—		$	42,498		$	—		$	—		$	323,947
Depreciation, depletion, and amortization	24,658			—			5,081			—			84			29,823
Operating income (loss)	25,566			—			3,836			(7,705		)	(3,987		)	17,710
Total assets	699,556			—			183,855			16,305			33,887			933,603
Capital expenditures	12,219			—			698			—			550			13,467

____________________

(1) The Canadian operations were acquired on April 28, 2014, therefore, information for the three and six months ended June 30, 2014 includes approximately two months of operations and there is no activity for 2013.

Certain amounts in prior periods have been reclassified to conform with the presentation of 2014. The reclassification affected depreciation, depletion and amortization and operating income (loss) between the Coal U.S. segment and the Corporate segment.

A reconciliation of segment income (loss) from operations to loss before income taxes follows:

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
	(In thousands)
Income (loss) from operations	$	(29,640	)	$	11,975		$	(21,588	)	$	17,710
Loss on extinguishment of debt	(12,635		)	(64		)	(12,635		)	(64		)
Interest expense	(21,786		)	(10,076		)	(42,584		)	(20,236		)
Interest income	1,582			280			1,884			577
Gain (loss) on foreign exchange	2,649			—			(4,141		)	—
Other income	483			130			576			198
Income (loss) before income taxes	$	(59,347	)	$	2,245		$	(78,488	)	$	(1,815	)

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SHARE-BASED COMPENSATION (Tables)

6 Months Ended

Jun. 30, 2014

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Compensation cost arising from share-based arrangements

The Company recognized compensation expense from share-based arrangements shown in the following table:

	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2013		2014		2013
	(In thousands)
Recognition of fair value of restricted stock units, stock options and SARs over vesting period; and issuance of stock	$	1,388	$	597	$	2,116	$	2,260
Contributions of stock to the Company's 401(k) plan	329		788		329		1,511
Total share-based compensation expense	$	1,717	$	1,385	$	2,445	$	3,771

Summary of Restricted Stock Unit activity

A summary of restricted stock award activity for the six months ended June 30, 2014 is as follows:

	Units		Weighted Average Grant-Date Fair Value		Unamortized Compensation Expense (In thousands)
Non-vested at December 31, 2013	588,727		$	9.37
Granted	214,188		—
Vested	(299,872	)	—
Non-vested at June 30, 2014	503,043		$	8.64	$	5,605	(1)

____________________

(1) Expected to be recognized over the next three years.

Summary of Stock Option Activity

A summary of stock option activity for the six months ended June 30, 2014 is as follows:

	Stock Options		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (In years)	Aggregate Intrinsic Value (In thousands)		Unamortized Compensation Expense (In thousands)
Outstanding at December 31, 2013	145,806		$	21.97
Exercised	(9,000	)	$	21.40
Expired	—		$	—
Outstanding and exercisable at June 30, 2014	136,806		$	22.01	3.7	$	1,953	$	—

Summary of Stock Appreciation Rights

A summary of SARs activity for the six months ended June 30, 2014 is as follows:

	SARs		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (In years)	Aggregate Intrinsic Value (In thousands)		Unamortized Compensation Expense (In thousands)
Outstanding at December 31, 2013	70,734		$	22.60
Exercised	(36,291	)	$	21.30
Expired	—		$	—
Outstanding and exercisable at June 30, 2014	34,443		$	23.97	1.7	$	424	$	—

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SUPPLEMENTAL CONSOLIDATING FINANCIAL INFORMATION

6 Months Ended

Jun. 30, 2014

Condensed Financial Information of Parent Company Only Disclosure [Abstract]

SUPPLEMENTAL CONSOLIDATING FINANCIAL INFORMATION

SUPPLEMENTAL CONSOLIDATING FINANCIAL INFORMATION

Pursuant to the indenture governing the 10.75% Senior Notes, certain 100% owned subsidiaries of the Company have fully and unconditionally guaranteed the notes on a joint and several basis.

As a result of the prepayment of the WML Notes, WML became a Guarantor Subsidiary. The following tables include WML as a Guarantor Subsidiary, including the 2013 information which has been recast.

Guarantees of the Senior Notes will be released under certain circumstances, including:

(1) in the event of a sale or other disposition of all or substantially all of the assets of such Guarantor Subsidiary, by way of merger, consolidation or otherwise, a sale or other disposition of all of the Equity Interests of such Guarantor Subsidiary then held by the Issuers or any Restricted Subsidiary; provided, that the sale or other disposition does not violate the “Asset Sales” provisions of the Indenture;

(2) if such Guarantor Subsidiary is designated as an Unrestricted Subsidiary in accordance with the provisions of the Indenture, upon effectiveness of such designation;

(3) upon Legal Defeasance or Covenant Defeasance (as such terms are defined in the indenture) or upon satisfaction and discharge of the Indenture;

(4) upon the liquidation or dissolution of such Guarantor Subsidiary, provided no event of default has occurred and is continuing; or

(5) at such time as such Guarantor Subsidiary is no longer required to be a Guarantor Subsidiary of the Senior Notes as described in the Indenture, provided no event of default has occurred and is continuing.

The following tables present unaudited consolidating financial information for (i) the issuer of the notes (Westmoreland Coal Company), (ii) the co-issuer of the notes (Westmoreland Partners), (iii) the guarantors under the notes, and (iv) the entities that are not guarantors under the notes:

CONSOLIDATING BALANCE SHEETS

June 30, 2014

(In thousands)

Assets	Parent/ Issuer		Co-Issuer		Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Consolidating Adjustments			Total
Current assets:
Cash and cash equivalents	$	13,514	$	415	$	24,440		$	2,241		$	—		$	40,610
Receivables:
Trade	—		12,940		116,712			—			—			129,652
Loan and lease receivable	—		—		11,682			—			—			11,682
Contractual third-party reclamation receivables	—		—		7,940			—			—			7,940
Intercompany receivable/payable	132,824		32,639		(146,187		)	(19,275		)	(1		)	—
Other	673		210		2,294			45			(40		)	3,182
	133,497		45,789		(7,559		)	(19,230		)	(41		)	152,456
Inventories	—		5,319		147,834			1			—			153,154
Deferred income taxes	5,370		—		683			—			—			6,053
Other current assets	972		335		11,055			—			—			12,362
Total current assets	153,353		51,858		176,453			(16,988		)	(41		)	364,635
Property, plant and equipment:
Land and mineral rights	—		1,395		437,606			—			—			439,001
Plant and equipment	4,022		221,350		606,965			—			—			832,337
	4,022		222,745		1,044,571			—			—			1,271,338
Less accumulated depreciation, depletion and amortization	2,863		76,662		406,295			—			—			485,820
Net property, plant and equipment	1,159		146,083		638,276			—			—			785,518
Loan and lease receivable	—		—		85,344			—			—			85,344
Advanced coal royalties	—		—		7,134			—			—			7,134
Reclamation deposits	—		—		75,911			—			—			75,911
Restricted investments and bond collateral	63,322		—		41,189			—			—			104,511
Contractual third-party reclamation receivables	—		—		93,956			—			—			93,956
Investment in joint venture	—		—		33,273			—			—			33,273
Intangible assets	—		460		217			—			—			677
Investment in subsidiaries	480,871		—		—			3,770			(484,641		)	—
Other assets	21,825		—		10,937			3,500			(3,500		)	32,762
Total assets	$	720,530	$	198,401	$	1,162,690		$	(9,718	)	$	(488,182	)	$	1,583,721

CONSOLIDATING BALANCE SHEETS

June 30, 2014

(In thousands)

Liabilities and Shareholders’ Deficit	Parent/ Issuer			Co-Issuer			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Consolidating Adjustments			Total
Current liabilities
Current installments of long-term debt	$	—		$	—		$	42,401		$	—		$	—		$	42,401
Accounts payable and accrued expenses:
Trade and other accrued liabilities	5,240			7,996			114,423			684			(5		)	128,338
Interest payable	30,315			—			474			—			(39		)	30,750
Production taxes	—			1,081			38,936			2,657			(1		)	42,673
Workers’ compensation	707			—			—			—			—			707
Postretirement medical benefits	12,042			—			773			1,139			1			13,955
SERP	390			—			—			—			—			390
Deferred revenue	—			9,581			1,980			—			—			11,561
Asset retirement obligations	—			—			31,131			—			—			31,131
Other current liabilities	593			5,279			6,102			—			(1		)	11,973
Total current liabilities	49,287			23,937			236,220			4,480			(45		)	313,879
Long-term debt, less current installments	698,015			—			96,128			—			(3,500		)	790,643
Workers’ compensation, less current portion	6,629			—			—			—			—			6,629
Excess of black lung benefit obligation over trust assets	9,841			—			—			—			—			9,841
Postretirement medical benefits, less current portion	184,902			—			68,766			18,105			—			271,773
Pension and SERP obligations, less current portion	12,776			97			9,110			239			—			22,222
Deferred revenue, less current portion	—			35,949			4,728			—			(1		)	40,676
Asset retirement obligations, less current portion	—			927			357,326			—			—			358,253
Intangible liabilities	—			5,072			—			—			—			5,072
Deferred income taxes	5,370			—			10,144			—			—			15,514
Other liabilities	707			5,790			3,167			200			—			9,864
Intercompany receivable/payable	13,648			—			(13,849		)	14,654			(14,453		)	—
Total liabilities	981,175			71,772			771,740			37,678			(17,999		)	1,844,366
Shareholders’ deficit
Preferred stock	96			—			—			—			—			96
Common stock	38,173			5			110			132			(247		)	38,173
Other paid-in capital	133,140			52,848			441,269			(124		)	(493,993		)	133,140
Accumulated other comprehensive loss	(53,615		)	(160		)	16,075			(3,067		)	(12,848		)	(53,615		)
Accumulated earnings (deficit)	(378,439		)	73,936			(66,504		)	(44,337		)	36,905			(378,439		)
Total equity (deficit)	(260,645		)	126,629			390,950			(47,396		)	(470,183		)	(260,645		)
Total liabilities and shareholders’ deficit	$	720,530		$	198,401		$	1,162,690		$	(9,718	)	$	(488,182	)	$	1,583,721

CONSOLIDATING BALANCE SHEETS

December 31, 2013

(In thousands)

Assets	Parent/ Issuer			Co-Issuer		Guarantor Subsidiaries		Non- Guarantor Subsidiaries			Consolidating Adjustments			Total
Current assets:
Cash and cash equivalents	$	25,326		$	3,341	$	27,451	$	4,992		$	—		$	61,110
Receivables:
Trade	—			12,934		46,985		6,277			—			66,196
Contractual third-party reclamation receivables	—			—		8,487		—			—			8,487
Intercompany receivable/payable	(16,273		)	—		2,761		(19,353		)	32,865			—
Other	1,616			210		3,256		28			(24		)	5,086
	(14,657		)	13,144		61,489		(13,048		)	32,841			79,769
Inventories	—			6,161		33,811		—			—			39,972
Deferred income taxes	5,355			—		870		—			(870		)	5,355
Restricted investments and bond collateral	—			5,998		—		—			—			5,998
Other current assets	789			143		11,069		834			—			12,835
Total current assets	16,813			28,787		134,690		(7,222		)	31,971			205,039
Property, plant and equipment:
Land and mineral rights	—			1,395		276,793		—			—			278,188
Plant and equipment	3,973			220,872		432,851		—			—			657,696
	3,973			222,267		709,644		—			—			935,884
Less accumulated depreciation, depletion and amortization	2,707			71,653		371,488		—			—			445,848
Net property, plant and equipment	1,266			150,614		338,156		—			—			490,036
Advanced coal royalties	—			—		7,311		—			—			7,311
Reclamation deposits	—			—		74,921		—			—			74,921
Restricted investments and bond collateral	15,134			—		54,101		—			—			69,235
Contractual third-party reclamation receivables	—			—		88,303		—			—			88,303
Intangible assets	—			1,283		237		—			—			1,520
Investment in subsidiaries	280,843			—		—		3,770			(284,613		)	—
Other assets	8,636			—		1,683		2,000			(1,999		)	10,320
Total assets	$	322,692		$	180,684	$	699,402	$	(1,452	)	$	(254,641	)	$	946,685

CONSOLIDATING BALANCE SHEETS

December 31, 2013

(In thousands)

Liabilities and Shareholders’ Deficit	Parent/ Issuer			Co-Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Current liabilities
Current installments of long-term debt	$	20,392		$	—		$	23,951		$	—		$	—		$	44,343
Accounts payable and accrued expenses:
Trade	6,840			10,119			38,061			2,487			—			57,507
Interest payable	11,302			—			40			—			(21		)	11,321
Production taxes	—			3			36,522			5,380			—			41,905
Workers’ compensation	717			—			—			—			—			717
Postretirement medical benefits	12,042			—			774			1,139			—			13,955
SERP	390			—			—			—			—			390
Deferred revenue	—			9,024			5,044			—			—			14,068
Asset retirement obligations	—			—			23,353			—			—			23,353
Other current liabilities	—			5,053			417			—			(1		)	5,469
Total current liabilities	51,683			24,199			128,162			9,006			(22		)	213,028
Long-term debt, less current installments	224,582			—			72,912			—			(2,000		)	295,494
Workers’ compensation, less current portion	6,744			—			—			—			—			6,744
Excess of black lung benefit obligation over trust assets	8,675			—			—			—			—			8,675
Postretirement medical benefits, less current portion	185,858			—			66,439			18,077			—			270,374
Pension and SERP obligations, less current portion	13,069			99			10,765			243			—			24,176
Deferred revenue, less current portion	—			41,297			5,270			—			—			46,567
Asset retirement obligations, less current portion	—			892			255,619			—			—			256,511
Intangible liabilities	—			5,606			—			—			—			5,606
Deferred income taxes	5,355			—			—			—			—			5,355
Other liabilities	584			—			6,687			983			(6,220		)	2,034
Intercompany receivable/payable	14,021			—			(7,851		)	14,654			(20,824		)	—
Total liabilities	510,571			72,093			538,003			42,963			(29,066		)	1,134,564
Shareholders’ deficit
Preferred stock	160			—			—			—			—			160
Common stock	36,479			5			110			132			(247		)	36,479
Other paid-in capital	134,861			52,835			157,984			(124		)	(210,695		)	134,861
Accumulated other comprehensive loss	(63,595		)	(164		)	6,425			(3,086		)	(3,175		)	(63,595		)
Accumulated earnings (deficit)	(295,784		)	55,915			(3,120		)	(41,337		)	(11,458		)	(295,784		)
Total equity (deficit)	(187,879		)	108,591			161,399			(44,415		)	(225,575		)	(187,879		)
Total liabilities and shareholders’ deficit	$	322,692		$	180,684		$	699,402		$	(1,452	)	$	(254,641	)	$	946,685

CONSOLIDATING STATEMENTS OF OPERATIONS

Three Months Ended June 30, 2014

(In thousands)

	Parent/ Issuer			Co-Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments		Total
Revenues	$	—		$	21,803		$	266,153		$	—		$	—	$	287,956
Costs and expenses:
Cost of sales	(247		)	21,592			227,044			—			—		248,389
Depreciation, depletion and amortization	79			2,485			21,915			—			—		24,479
Selling and administrative	12,003			1,169			15,921			(384		)	—		28,709
Heritage health benefit expenses	3,178			—			—			210			—		3,388
Gain on sales of assets	—			—			(43		)	—			—		(43		)
Restructuring charges	796			101			6,646			—			—		7,543
Derivative loss	—			5,930			—			—			—		5,930
Income from equity affiliates	—			—			(799		)	—			—		(799		)
	15,809			31,277			270,684			(174		)	—		317,596
Operating income (loss)	(15,809		)	(9,474		)	(4,531		)	174			—		(29,640		)
Other income (expense):
Interest expense	(18,609		)	(74		)	(3,111		)	(1		)	9		(21,786		)
Loss on extinguishment of debt	(63		)	—			(12,571		)	(1		)	—		(12,635		)
Interest income	145			4			1,433			—			—		1,582
Gain on foreign exchange	1,557			—			1,092			—			—		2,649
Other income	—			—			483			—			—		483
	(16,970		)	(70		)	(12,674		)	(2		)	9		(29,707		)
Income (loss) before income taxes and income of consolidated subsidiaries	(32,779		)	(9,544		)	(17,205		)	172			9		(59,347		)
Equity in income of subsidiaries	(30,462		)	—			—			—			30,462		—
Income (loss) before income taxes	(63,241		)	(9,544		)	(17,205		)	172			30,471		(59,347		)
Income tax expense (benefit)	(87		)	—			(74		)	1			3,967		3,807
Net income (loss)	(63,154		)	(9,544		)	(17,131		)	171			26,504		(63,154		)
Less net loss attributable to noncontrolling interest	—			—			—			—			—		—
Net income (loss) attributable to the Parent company	$	(63,154	)	$	(9,544	)	$	(17,131	)	$	171		$	26,504	$	(63,154	)

CONSOLIDATING STATEMENTS OF OPERATIONS

Three Months Ended June 30, 2013

(In thousands)

	Parent/ Issuer			Co-Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Revenues	$	—		$	23,162		$	134,449		$	9,538		$	(4,650	)	$	162,499
Costs and expenses:
Cost of sales	(372		)	14,901			113,640			7,009			(4,650		)	130,528
Depreciation, depletion and amortization	94			2,551			12,753			—			(1		)	15,397
Selling and administrative	4,259			872			7,232			(394		)	—			11,969
Heritage health benefit expenses	2,844			—			—			265			—			3,109
Gain on sales of assets	—			—			(74		)	—			—			(74		)
Other operating income	—			—			(10,405		)	—			—			(10,405		)
	6,825			18,324			123,146			6,880			(4,651		)	150,524
Operating income (loss)	(6,825		)	4,838			11,303			2,658			1			11,975
Other income (expense):
Interest expense	(7,591		)	(10		)	(2,479		)	(5		)	9			(10,076		)
Loss on extinguishment of debt	(64		)	—			—			—			—			(64		)
Interest income	46			5			232			6			(9		)	280
Other income (loss)	2			—			130			(2		)	—			130
	(7,607		)	(5		)	(2,117		)	(1		)	—			(9,730		)
Income (loss) before income taxes and income of consolidated subsidiaries	(14,432		)	4,833			9,186			2,657			1			2,245
Equity in income of subsidiaries	16,648			—			—			—			(16,648		)	—
Income (loss) before income taxes	2,216			4,833			9,186			2,657			(16,647		)	2,245
Income tax expense (benefit)	(1		)	—			1,139			—			(1,110		)	28
Net income (loss)	2,217			4,833			8,047			2,657			(15,537		)	2,217
Less net loss attributable to noncontrolling interest	2,499			—			—			—			—			2,499
Net income (loss) attributable to the Parent company	$	(282	)	$	4,833		$	8,047		$	2,657		$	(15,537	)	$	(282	)

CONSOLIDATING STATEMENTS OF OPERATIONS

Six Months Ended June 30, 2014

(In thousands)

	Parent/ Issuer			Co-Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Revenues	$	—		$	43,815		$	424,351		$	(7	)	$	—		$	468,159
Costs and expenses:
Cost of sales	(471		)	38,046			349,389			55			—			387,019
Depreciation, depletion and amortization	156			5,009			35,373			—			—			40,538
Selling and administrative	16,968			2,062			23,783			(773		)	—			42,040
Heritage health benefit expenses	6,504			—			—			428			—			6,932
Gain on sales of assets	—			—			(5		)	—			—			(5		)
Restructuring charges	796			499			6,646			—			—			7,941
Derivative loss	—			5,930			—			—			—			5,930
Equity in net income of unconsolidated affiliates	—			—			(799		)	—			—			(799		)
Other operating income	—			—			150			1			—			151
	23,953			51,546			414,537			(289		)	—			489,747
Operating income (loss)	(23,953		)	(7,731		)	9,814			282			—			(21,588		)
Other income (expense):
Interest expense	(37,282		)	(118		)	(5,199		)	—			15			(42,584		)
Loss on extinguishment of debt	(62		)	—			(12,572		)	(1		)	—			(12,635		)
Interest income	269			7			1,608			15			(15		)	1,884
Gain (loss) on foreign exchange	(5,233		)	—			1,092			—			—			(4,141		)
Other income	—			—			576			—			—			576
	(42,308		)	(111		)	(14,495		)	14			—			(56,900		)
Income (loss) before income taxes and income of consolidated subsidiaries	(66,261		)	(7,842		)	(4,681		)	296			—			(78,488		)
Equity in income of subsidiaries	(16,148		)	—			—			—			16,148			—
Income (loss) before income taxes	(82,409		)	(7,842		)	(4,681		)	296			16,148			(78,488		)
Income tax expense (benefit)	(224		)	—			5,041			—			(1,120		)	3,697
Net income (loss)	(82,185		)	(7,842		)	(9,722		)	296			17,268			(82,185		)
Less net loss attributable to noncontrolling interest	—			—			—			—			—			—
Net income (loss) attributable to the Parent company	$	(82,185	)	$	(7,842	)	$	(9,722	)	$	296		$	17,268		$	(82,185	)

CONSOLIDATING STATEMENTS OF OPERATIONS

Six Months Ended June 30, 2013

(In thousands)

	Parent/ Issuer			Co-Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Revenues	$	—		$	42,498		$	274,187		$	20,889		$	(13,627	)	$	323,947
Costs and expenses:
Cost of sales	(770		)	31,856			223,417			20,073			(13,627		)	260,949
Depreciation, depletion and amortization	187			5,082			24,554			—			—			29,823
Selling and administrative	8,207			1,726			14,680			(758		)	—			23,855
Heritage health benefit expenses	6,533			—			—			527			—			7,060
Gain on sales of assets	—			—			(308		)	—			—			(308		)
Other operating income	—			—			(15,142		)	—			—			(15,142		)
	14,157			38,664			247,201			19,842			(13,627		)	306,237
Operating income (loss)	(14,157		)	3,834			26,986			1,047			—			17,710
Other income (expense):
Interest expense	(15,175		)	(20		)	(5,048		)	(10		)	17			(20,236		)
Loss on extinguishment of debt	(64		)	—			—			—			—			(64		)
Interest income	76			15			493			10			(17		)	577
Other income (loss)	—			—			200			(2		)	—			198
	(15,163		)	(5		)	(4,355		)	(2		)	—			(19,525		)
Income (loss) before income taxes and income of consolidated subsidiaries	(29,320		)	3,829			22,631			1,045			—			(1,815		)
Equity in income of subsidiaries	27,450			—			—			—			(27,450		)	—
Income (loss) before income taxes	(1,870		)	3,829			22,631			1,045			(27,450		)	(1,815		)
Income tax expense (benefit)	—			—			4,458			—			(4,403		)	55
Net income (loss)	(1,870		)	3,829			18,173			1,045			(23,047		)	(1,870		)
Less net loss attributable to noncontrolling interest	797			—			—			—			—			797
Net income (loss) attributable to the Parent company	$	(2,667	)	$	3,829		$	18,173		$	1,045		$	(23,047	)	$	(2,667	)

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

Three Months Ended June 30, 2014

(In thousands)

	Parent/Issuer			Co-Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Consolidating Adjustments			Total
Net income (loss)	$	(63,154	)	$	(9,544	)	$	(17,131	)	$	171	$	26,504		$	(63,154	)
Other comprehensive income (loss)
Amortization of accumulated actuarial gains or losses, pension	359			2			122			6		(130		)	359
Amortization of accumulated actuarial gains or losses, transition obligations, and prior service costs, postretirement medical benefit	5			—			(36		)	5		31			5
Tax effect of other comprehensive income gains	64			—			—			—		—			64
Change in foreign currency translation adjustment	9,477			—			9,477			—		(9,477		)	9,477
Other comprehensive income (loss)	9,905			2			9,563			11		(9,576		)	9,905
Comprehensive income (loss) attributable to the Parent company	$	(53,249	)	$	(9,542	)	$	(7,568	)	$	182	$	16,928		$	(53,249	)

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

Three Months Ended June 30, 2013

(In thousands)

	Parent/Issuer			Co-Issuer		Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Consolidating Adjustments			Total
Net income (loss)	$	2,217		$	4,833	$	8,047		$	2,657	$	(15,537	)	$	2,217
Other comprehensive income (loss)
Amortization of accumulated actuarial gains or losses, pension	1,004			8		239			—		(247		)	1,004
Amortization of accumulated actuarial gains or losses, transition obligations, and prior service costs, postretirement medical benefit	1,001			—		214			—		(214		)	1,001
Unrealized and realized gains and losses on available-for-sale securities	(39		)	—		(40		)	—		40			(39		)
Other comprehensive income (loss)	1,966			8		413			—		(421		)	1,966
Comprehensive income (loss) attributable to the Parent company	$	4,183		$	4,841	$	8,460		$	2,657	$	(15,958	)	$	4,183

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

Six Months Ended June 30, 2014

(In thousands)

	Parent/Issuer			Co-Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Consolidating Adjustments			Total
Net income (loss)	$	(82,185	)	$	(7,842	)	$	(9,722	)	$	296	$	17,268		$	(82,185	)
Other comprehensive income (loss)
Amortization of accumulated actuarial gains or losses, pension	717			4			244			11		(259		)	717
Amortization of accumulated actuarial gains or losses, transition obligations, and prior service costs, postretirement medical benefit	10			—			(72		)	10		62			10
Tax effect of other comprehensive income gains	(224		)	—			—			—		—			(224		)
Change in foreign currency translation adjustment	9,477			—			9,477			—		(9,477		)	9,477
Other comprehensive income (loss)	9,980			4			9,649			21		(9,674		)	9,980
Comprehensive income (loss) attributable to the Parent company	$	(72,205	)	$	(7,838	)	$	(73	)	$	317	$	7,594		$	(72,205	)

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

Six Months Ended June 30, 2013

(In thousands)

	Parent/Issuer			Co-Issuer		Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Consolidating Adjustments			Total
Net income (loss)	$	(1,870	)	$	3,829	$	18,173		$	1,045	$	(23,047	)	$	(1,870	)
Other comprehensive income (loss)
Amortization of accumulated actuarial gains or losses, pension	1,745			14		432			—		(446		)	1,745
Amortization of accumulated actuarial gains or losses, transition obligations, and prior service costs, postretirement medical benefit	2,002			—		427			—		(427		)	2,002
Unrealized and realized gains and losses on available-for-sale securities	(39		)	—		(40		)	—		40			(39		)
Other comprehensive income (loss)	3,708			14		819			—		(833		)	3,708
Comprehensive income (loss) attributable to the Parent company	$	1,838		$	3,843	$	18,992		$	1,045	$	(23,880	)	$	1,838

CONSOLIDATING STATEMENTS OF CASH FLOWS

Six Months Ended June 30, 2014

(In thousands)

Statements of Cash Flows	Parent/ Issuer			Co-Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Cash flows from operating activities:
Net income (loss)	$	(82,185	)	$	(7,842	)	$	(9,722	)	$	296		$	17,268		$	(82,185	)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Equity in income of subsidiaries	16,148			—			—			—			(16,148		)	—
Depreciation, depletion, and amortization	156			5,009			35,373			—			—			40,538
Accretion of asset retirement obligation and receivable	—			34			9,254			—			—			9,288
Non-cash tax benefits	(224		)	—			—			—			—			(224		)
Amortization of intangible assets and liabilities, net	—			290			20			—			—			310
Share-based compensation	1,934			14			497			—			—			2,445
Gain on sales of assets	—			—			(5		)	—			—			(5		)
Amortization of deferred financing costs	494			—			715			—			—			1,209
Loss on extinguishment of debt	62			—			12,572			1			—			12,635
Loss on sales of investment securities	—			—			3			—			—			3
Loss on derivative	—			5,930			—			—			—			5,930
Loss on foreign exchange	5,233			—			(1,092		)	—			—			4,141
Income from equity affiliates	—			—			(799		)	—			—			(799		)
Distributions from equity affiliates	—			—			730			—			—			730
Changes in operating assets and liabilities:
Receivables, net	943			(6		)	(18,474		)	4,733			1,534			(11,270		)
Inventories	—			842			21,929			(1		)	—			22,770
Excess of black lung benefit obligation over trust assets	1,166			—			—			—			—			1,166
Deferred income tax	—			—			3,854			—			—			3,854
Accounts payable and accrued expenses	17,348			(1,101		)	(3,164		)	(4,526		)	(19		)	8,538
Deferred revenue	—			(4,791		)	(3,633		)	—			—			(8,424		)
Income tax payable	—			—			528			—			—			528
Accrual for workers’ compensation	(125		)	—			—			—			—			(125		)
Asset retirement obligations	—			—			(3,364		)	2			—			(3,362		)
Accrual for postretirement medical benefits	(885		)	—			2,256			38			—			1,409
Pension and SERP obligations	166			2			(507		)	7			—			(332		)
Other assets and liabilities	(7,429		)	(273		)	4,113			(1,193		)	6,587			1,805
Distributions received from subsidiaries	76,800			—			—			—			(76,800		)	—

Net cash provided by (used in) operating activities	29,602			(1,892		)	51,084			(643		)	(67,578		)	10,573
Cash flows from investing activities:
Additions to property, plant and equipment	16			(255		)	(17,122		)	—			—			(17,361		)
Change in restricted investments and bond collateral and reclamation deposits	(48,188		)	5,998			11,673			—			—			(30,517		)
Cash payments related to Canadian acquisition	(282,788		)	—			(39,849		)	—			—			(322,637		)
Cash acquired related to Canadian acquisition	—			—			8,103			—			—			8,103
Net proceeds from sales of assets	—			—			213			—			—			213
Proceeds from the sale of investments	—			—			246			—			—			246
Increase in loan and lease receivable	—			—			(1,120		)	—			—			(1,120		)
Receipts from loan and lease receivable	—			—			2,164			—			—			2,164
Receivable from customer for property and equipment purchases	—			—			—			—			—			—
Other	—			—			(82		)	—			—			(82		)
Net cash provided by (used in) investing activities	(330,960		)	5,743			(35,774		)	—			—			(360,991		)
Cash flows from financing activities:
Change in book overdrafts	—			—			1,605			—			—			1,605
Borrowings from long-term debt	454,219			—			—			—			—			454,219
Repayments of long-term debt	(1,015		)	—			(96,523		)	—			—			(97,538		)
Borrowings on revolving lines of credit	—			—			10,000			—			—			10,000
Repayments on revolving lines of credit	—			—			(10,000		)	—			—			(10,000		)
Debt issuance costs and other refinancing costs	(15,407		)	—			(11,646		)	—			—			(27,053		)
Dividends/distributions	(470		)	(8,500		)	(68,300		)	—			76,800			(470		)
Exercise of stock options	193			—			—			—			—			193
Transactions with Parent/affiliates	(147,974		)	1,723			157,581			(2,108		)	(9,222		)	—
Net cash provided by (used in) financing activities	289,546			(6,777		)	(17,283		)	(2,108		)	67,578			330,956
Effect of foreign exchange rates on cash	—			—			(1,038		)	—			—			(1,038		)
Net decrease in cash and cash equivalents	(11,812		)	(2,926		)	(3,011		)	(2,751		)	—			(20,500		)
Cash and cash equivalents, beginning of period	25,326			3,341			27,451			4,992			—			61,110
Cash and cash equivalents, end of period	$	13,514		$	415		$	24,440		$	2,241		$	—		$	40,610

CONSOLIDATING STATEMENTS OF CASH FLOWS

Six Months Ended June 30, 2013

(In thousands)

Statements of Cash Flows	Parent/ Issuer			Co-Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total
Cash flows from operating activities:
Net income (loss)	$	(1,870	)	$	3,829		$	18,173		$	1,045		$	(23,047	)	$	(1,870	)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Equity in income of subsidiaries	(27,450		)	—			—			—			27,450			—
Depreciation, depletion, and amortization	187			5,082			24,554			—			—			29,823
Accretion of asset retirement obligation and receivable	—			32			6,305			1			—			6,338
Amortization of intangible assets and liabilities, net	—			312			19			(5		)	—			326
Share-based compensation	1,567			23			2,181			—			—			3,771
Gain on sales of assets	—			—			(308		)	—			—			(308		)
Amortization of deferred financing costs	1,541			—			315			—			—			1,856
Loss on extinguishment of debt	64			—			—			—			—			64
Loss on sales of investment securities	—			—			(28		)	—			—			(28		)
Changes in operating assets and liabilities:
Receivables, net	(227		)	(1,995		)	4,419			(239		)	1,729			3,687
Inventories	—			(1,632		)	(345		)	—			—			(1,977		)
Excess of black lung benefit obligation over trust assets	(280		)	—			—			(1		)	—			(281		)
Accounts payable and accrued expenses	(1,957		)	4,101			904			(1,146		)	(201		)	1,701
Deferred revenue	—			(4,190		)	(2,025		)	1			—			(6,214		)
Income tax payable	—			—			(55		)	(1		)	—			(56		)
Accrual for workers’ compensation	(284		)	—			—			—			—			(284		)
Asset retirement obligations	—			—			(5,422		)	(2		)	—			(5,424		)
Accrual for postretirement medical benefits	(40		)	—			4,010			124			—			4,094
Pension and SERP obligations	695			9			826			(13		)	—			1,517
Other assets and liabilities	(49		)	101			(1,489		)	(374		)	—			(1,811		)
Distributions received from subsidiaries	36,600			—			—			—			(36,600		)	—
Net cash provided by (used in) operating activities	8,497			5,672			52,034			(610		)	(30,669		)	34,924
Cash flows from investing activities:
Additions to property, plant and equipment	(575		)	(698		)	(12,189		)	(4		)	(1		)	(13,467		)
Change in restricted investments and bond collateral and reclamation deposits	(807		)	(5		)	(7,902		)	—			—			(8,714		)
Net proceeds from sales of assets	—			—			577			—			—			577
Proceeds from the sale of investments	—			—			6,807			—			—			6,807

Receivable from customer for property and equipment purchases	—			—			(307		)	(1		)	—			(308		)
Net cash used in investing activities	(1,382		)	(703		)	(13,014		)	(5		)	(1		)	(15,105		)
Cash flows from financing activities:
Change in book overdrafts	—			—			1,777			—			—			1,777
Repayments of long-term debt	(500		)	—			(15,561		)	(9		)	—			(16,070		)
Borrowings on revolving lines of credit	—			—			6,000			—			—			6,000
Repayments on revolving lines of credit	—			—			(6,000		)	—			—			(6,000		)
Debt issuance costs and other refinancing costs	(26		)	—			(156		)	—			—			(182		)
Dividends/distributions	(680		)	(9,000		)	(27,600		)	—			36,600			(680		)
Transactions with Parent/affiliates	(5,080		)	(38		)	8,699			2,349			(5,930		)	—
Net cash provided by (used in) financing activities	(6,286		)	(9,038		)	(32,841		)	2,340			30,670			(15,155		)
Net increase (decrease) in cash and cash equivalents	829			(4,069		)	6,179			1,725			—			4,664
Cash and cash equivalents, beginning of period	14,836			4,545			10,237			1,992			—			31,610
Cash and cash equivalents, end of period	$	15,665		$	476		$	16,416		$	3,717		$	—		$	36,274

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SHARE-BASED COMPENSATION - Compensation Expense from Share-Based Arrangements (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Recognition of fair value of restricted stock units, stock options, and SARs over vesting period; and issuance of common stock	$ 1,388	$ 597	$ 2,116	$ 2,260
Contributions of stock to the Company's 401(k) plan	329	788	329	1,511
Total share-based compensation expense	$ 1,717	$ 1,385	$ 2,445	$ 3,771

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Consolidated Statements of Cash Flows (Unaudited) (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013
Cash flows from operating activities:
Net loss	$ (82,185)	$ (1,870)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation, depletion and amortization	40,538	29,823
Accretion of asset retirement obligation and receivable	9,288	6,338
Non-cash tax benefits	(224)	0
Amortization of intangible assets and liabilities, net	310	326
Share-based compensation	2,445	3,771
Gain on sales of assets	(5)	(308)
Amortization of deferred financing costs	1,209	1,856
Loss on extinguishment of debt	12,635	64
Loss (gain) on sales of investment securities	3	(28)
Derivative loss	5,930	0
Loss on foreign exchange	4,141	0
Income from equity affiliates	(799)	0
Distributions from equity affiliates	730	0
Changes in operating assets and liabilities:
Receivables, net	(11,270)	3,687
Inventories	22,770	(1,977)
Excess of black lung benefit obligation over trust assets	1,166	(281)
Deferred income tax	3,854	0
Accounts payable and accrued expenses	8,538	1,701
Deferred revenue	(8,424)	(6,214)
Income tax payable	528	(56)
Accrual for workers' compensation	(125)	(284)
Asset retirement obligation	(3,362)	(5,424)
Accrual for postretirement medical benefits	1,409	4,094
Pension and SERP obligations	(332)	1,517
Other assets and liabilities	1,805	(1,811)
Net cash provided by operating activities	10,573	34,924
Cash flows from investing activities:
Additions to property, plant and equipment	(17,361)	(13,467)
Change in restricted investments and bond collateral and reclamation deposits	(30,517)	(8,714)
Cash payments related to Canadian acquisition	(322,637)	0
Cash acquired in related to Canadian acquisition	8,103	0
Net proceeds from sales of assets	213	577
Proceeds from sale of restricted investments	246	6,807
Increase in loan and lease receivable	(1,120)	0
Receipts from loan and lease receivable	2,164	0
Receivable from customer for property and equipment purchases	0	(308)
Other	(82)	0
Net cash used in investing activities	(360,991)	(15,105)
Cash flows from financing activities:
Change in book overdrafts	1,605	1,777
Borrowings from long-term debt, net of debt discount	454,219	0
Repayments of long-term debt	(97,538)	(16,070)
Borrowings on revolving lines of credit	10,000	6,000
Repayments of revolving lines of credit	(10,000)	(6,000)
Debt issuance costs and other refinancing costs	(27,053)	(182)
Preferred dividends paid	(470)	(680)
Exercise of stock options	193	0
Net cash provided by (used in) financing activities	330,956	(15,155)
Effect of foreign exchange rates on cash	(1,038)	0
Net increase in cash and cash equivalents	(20,500)	4,664
Cash and cash equivalents, beginning of period	61,110	31,610
Cash and cash equivalents, end of period	$ 40,610	$ 36,274

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Consolidated Balance Sheets (Parenthetical) (USD $) In Millions, except Share data, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Statement of Financial Position [Abstract]
Intangible assets, accumulated amortization	$ 14.9	$ 14.1
Intangible liabilities, accumulated amortization	$ 13.0	$ 12.4
Preferred stock, par value (in USD per share)	$ 1.00	$ 1.00
Preferred stock, shares authorized	5,000,000	5,000,000
Preferred stock, shares issued	112,994	159,960
Preferred stock, shares outstanding	112,994	159,960
Common stock, par value (in USD per share)	$ 2.50	$ 2.50
Common stock, shares authorized	30,000,000	30,000,000
Common stock, shares issued	15,075,153	14,592,231
Common stock, shares outstanding	15,075,153	14,592,231

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DERIVATIVE INSTRUMENTS

6 Months Ended

Jun. 30, 2014

Derivative Instruments and Hedging Activities Disclosure [Abstract]

DERIVATIVE INSTRUMENTS

DERIVATIVE INSTRUMENTS

Derivative Assets and Liabilities

The Company evaluates all of its financial instruments to determine if such instruments are derivatives, derivatives that qualify for the normal purchase normal sale exception, or contain features that qualify as embedded derivatives. All derivative financial instruments, except for derivatives that qualify for the normal purchase normal sale exception, are recognized on the balance sheet at fair value. Changes in fair value are recognized in earnings if they are not eligible for hedge accounting or in other comprehensive income if they qualify for cash flow hedge accounting.

In the first quarter of 2014, the Company entered into two foreign currency exchange forward contracts to purchase Canadian Dollars to manage a portion of its exposure to fluctuating rates of exchange on anticipated Canadian Dollar-denominated Canadian Acquisition cash flows. These two foreign currency contracts had a total notional amount of $348.3 million and were settled in April 2014.

During 2014, the Company entered into contracts to purchase power at its ROVA facility to manage exposure to power price fluctuations. These contracts cover the period from April 2014 to December 2018 and contracted power prices range from $41.05 to $44.09 megawatts per hour. The fair value of these power price derivatives are based on comparing contracted prices to projected future prices.

The fair value of outstanding derivative instruments not designated as hedging instruments on the accompanying Consolidated Balance Sheet was as follows (in thousands):

Derivative Instruments	Balance Sheet Location	June 30, 2014
Contracts to purchase power	Other current liabilities	$	140
Contracts to purchase power	Other liabilities	5,790

The effect of derivative instruments not designated as hedging instruments on the accompanying Consolidated Statements of Operations was as follows (in thousands):

Derivative Instruments	Statement of Operations Location	Three Months Ended June 30, 2014			Six Months Ended June 30, 2014
Canadian dollar foreign exchange forward contracts	Gain (loss) on foreign exchange	$	581		$	(6,209	)
Contracts to purchase power	Derivative loss	(5,930		)	(5,930		)

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Document and Entity Information	6 Months Ended
	Jun. 30, 2014	Jul. 29, 2014
Document Documentand Entity Information [Abstract]
Entity Registrant Name	WESTMORELAND COAL Co
Entity Central Index Key	0000106455
Document Type	10-Q
Document Period End Date	Jun. 30, 2014
Amendment Flag	false
Document Fiscal Year Focus	2014
Document Fiscal Period Focus	Q2
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Entity Common Stock, Shares Outstanding		16,986,656

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FAIR VALUE MEASUREMENTS

6 Months Ended

Jun. 30, 2014

Fair Value Disclosures [Abstract]

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. See Notes 4, 9 and 10 for additional disclosures related to fair value measurements.

Fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy, as defined below, gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities and the lowest priority to unobservable inputs.

• Level 1, defined as observable inputs such as quoted prices in active markets for identical assets.

• Level 2, defined as observable inputs other than Level 1 prices. These include quoted prices for similar assets or liabilities in an active market, quoted prices for identical assets and liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

• Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.

Long-term debt fair value estimates are based on observed prices for securities with an active trading market when available (Level 2) and otherwise using discount rate estimates based on interest rates as of June 30, 2014 (Level 3). The estimated fair values of the Company’s debt with fixed interest rates are as follows:

	Carrying Value		Fair Value
	(In thousands)
December 31, 2013	$	328,473	$	364,329
June 30, 2014	$	694,515	$	726,146

The Company uses derivative financial instruments, primarily foreign exchange contracts and forward contracts to purchase power, to reduce its exposure to market risks from changes in foreign exchange rates and changes in prices for power, respectively. The foreign exchange contracts are measured at fair value using quoted forward foreign exchange prices from counterparties corroborated by market-based pricing (Level 2). The contracts to purchase power are measured at fair value using forward pricing curves for power from counterparties corroborated by market-based pricing (Level 2). Additional information related to the Company’s derivative financial instruments is disclosed in Notes 1 and 10 to the consolidated financial statements.

The Company’s non-recurring fair value measurements include asset retirement obligations (refer to Note 9).

The Company determines the estimated fair value of its asset retirement obligations by calculating the present value of estimated cash flows related to reclamation liabilities using Level 3 inputs. The significant inputs used to calculate such liabilities includes estimates of costs to be incurred, the Company’s credit adjusted discount rate, inflation rates and estimated dates of reclamation. The asset retirement liability is accreted to its present value each period and the capitalized asset retirement cost is depleted using the units-of-production method.

The fair value of assets and liabilities acquired through business combinations is calculated using a discounted-cash flow approach using Level 3 inputs. Cash flow estimates require forecasts and assumptions for many years into the future for a variety of factors.

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Consolidated Statements of Operations (Unaudited) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Income Statement [Abstract]
Revenues	$ 287,956	$ 162,499	$ 468,159	$ 323,947
Costs, expenses and other:
Cost of sales	248,389	130,528	387,019	260,949
Depreciation, depletion and amortization	24,479	15,397	40,538	29,823
Selling and administrative	28,709	11,969	42,040	23,855
Heritage health benefit expenses	3,388	3,109	6,932	7,060
Gain on sales of assets	(43)	(74)	(5)	(308)
Restructuring charges	7,543	0	7,941	0
Derivative loss	5,930	0	5,930	0
Income from equity affiliates	(799)	0	(799)	0
Other operating loss (income)	0	(10,405)	151	(15,142)
Total costs, expenses and other	317,596	150,524	489,747	306,237
Operating income (loss)	(29,640)	11,975	(21,588)	17,710
Other income (expense):
Interest expense	(21,786)	(10,076)	(42,584)	(20,236)
Loss on extinguishment of debt	(12,635)	(64)	(12,635)	(64)
Interest income	1,582	280	1,884	577
Gain (loss) on foreign exchange	2,649	0	(4,141)	0
Other income	483	130	576	198
Total other income (expense)	(29,707)	(9,730)	(56,900)	(19,525)
Income (loss) before income taxes	(59,347)	2,245	(78,488)	(1,815)
Income tax expense	3,807	28	3,697	55
Net income (loss)	(63,154)	2,217	(82,185)	(1,870)
Less net income attributable to noncontrolling interest	0	2,499	0	797
Net loss attributable to the Parent company	(63,154)	(282)	(82,185)	(2,667)
Less preferred stock dividend requirements	209	340	470	680
Net loss applicable to common shareholders	$ (63,363)	$ (622)	$ (82,655)	$ (3,347)
Net loss per share applicable to common shareholders:
Basic and diluted (in dollars per share)	$ (4.19)	$ (0.04)	$ (5.52)	$ (0.23)
Weighted average number of common shares outstanding:
Basic and diluted (shares)	15,136	14,495	14,962	14,389

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RESTRUCTURING CHARGES

6 Months Ended

Jun. 30, 2014

Restructuring and Related Activities [Abstract]

RESTRUCTURING CHARGES

RESTRUCTURING CHARGES

In 2013, the Company entered into an agreement with Dominion Virginia Power, a subsidiary of Dominion, to restructure the remaining 5 years of the ROVA contract. The Company recorded a restructuring charge for additional contractual obligations of $0.1 million and $0.5 million for the three and six months ended June 30, 2014, respectively. The Company expects that the $5.1 million of accruals will be paid out by the end of 2014.

The table below represents the restructuring provision activity related to the ROVA restructuring affecting our Power segment during the six months ended June 30, 2014 (in millions):

Beginning Balance		Restructuring Charges		Restructuring Payments		Ending Balance
$	5.1	$	0.5	$	0.5	$	5.1

During the second quarter of 2014, the Company initiated strategic changes related to the Canadian Acquisition. The restructuring actions are expected to be completed in 2014. The Company recorded a restructuring charge for one-time employee termination benefits of $8.0 million for the three and six months ended June 30, 2014 and expects that accruals will be paid through 2016.

The table below represents the restructuring provision activity related to the Canadian Acquisition affecting our Coal - Canada and Coal - US segments during the six months ended June 30, 2014 (in millions):

Beginning Balance		Restructuring Charges		Restructuring Payments		Ending Balance
$	—	$	8.0	$	0.4	$	7.6

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RESTRICTED INVESTMENTS AND BOND COLLATERAL

6 Months Ended

Jun. 30, 2014

Disclosure Restricted Investments and Bond Collateral [Abstract]

RESTRICTED INVESTMENTS AND BOND COLLATERAL

RESTRICTED INVESTMENTS AND BOND COLLATERAL

The Company’s restricted investments and bond collateral consist of the following:

	June 30, 2014		December 31, 2013
	(In thousands)
Coal - U.S. Segment:
WML debt reserve account	$	—	$	13,067
Reclamation bond collateral:
Kemmerer Mine	25,077		24,966
Absaloka Mine	11,696		11,653
Rosebud Mine	3,145		3,145
Beulah Mine	1,270		1,270
Coal - Canada Segment:
PMRU	16,201		—
CVRI	31,867		—
Power Segment:
Letter of credit account	—		5,998
Corporate Segment:
Postretirement medical benefit bonds	8,550		8,467
Workers’ compensation bonds	6,705		6,667
Total restricted investments and bond collateral	104,511		75,233
Less current portion	—		(5,998		)
Total restricted investments and bond collateral, less current portion	$	104,511	$	69,235

For all of its restricted investments and bond collateral accounts, the Company can select from limited fixed-income investment options for the funds and receive the investment returns on these investments. Funds in the restricted investments and bond collateral accounts are not available to meet the Company’s general cash needs.

These accounts include held-to-maturity securities. Held-to-maturity securities are recorded at amortized cost, adjusted for the amortization or accretion of premiums or discounts calculated on the effective interest method. Interest income is recognized when earned.

The Company’s carrying value and estimated fair value of its restricted investments and bond collateral at June 30, 2014 are as follows:

	Carrying Value		Fair Value
	(In thousands)
Cash and cash equivalents	$	67,340	$	67,340
Time deposits	2,451		2,451
Held-to-maturity securities	34,720		35,259
	$	104,511	$	105,050

Held-to-Maturity Restricted Investments and Bond Collateral

The amortized cost, gross unrealized holding gains and fair value of held-to-maturity securities at June 30, 2014 is as follows (in thousands):

Amortized cost	$	34,720
Gross unrealized holding gains	628
Gross unrealized holding losses	(89		)
Fair value	$	35,259

Maturities of held-to-maturity securities are as follows at June 30, 2014:

	Amortized Cost		Fair Value
	(In thousands)
Due within one year	$	1,212	$	1,230
Due in five years or less	19,360		19,704
Due after five years to ten years	8,897		9,070
Due in more than ten years	5,251		5,255
	$	34,720	$	35,259

The Company does not intend to sell its held-to-maturity securities and it is not more likely than not that the Company will be required to sell the securities before recovery of amortized cost bases, which may be at maturity.

As of February 2014, the Company is no longer required to fund a letter of credit account for its power operations.

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CONTINGENCIES

6 Months Ended

Jun. 30, 2014

Commitments and Contingencies Disclosure [Abstract]

CONTINGENCIES

CONTINGENCIES

The Company is a party to routine claims and lawsuits with respect to various matters. The Company provides for costs related to contingencies when a loss is probable and the amount is reasonably estimable. After conferring with counsel, it is the opinion of management that the ultimate resolution of pending claims will not have a material adverse effect on the consolidated financial condition, results of operations, or liquidity of the Company.

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SHAREHOLDERS' EQUITY AND ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

6 Months Ended

Jun. 30, 2014

Stockholders' Equity Note [Abstract]

SHAREHOLDERS' EQUITY AND ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

SHAREHOLDERS’ EQUITY AND ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

Preferred Stock

The Company has outstanding Series A Convertible Exchangeable Preferred Stock on which cumulative dividends of $2.125 per share are payable quarterly. The Company paid $0.5 million of preferred stock dividends for the six months ended June 30, 2014. During the three months ended June 30, 2014, approximately 25,454 shares of preferred stock were converted into 173,885 shares of common stock. Subsequent to June 30, 2014 and through July 29, 2014, approximately 3,825 shares of preferred stock were converted into 26,133 shares of common stock.

Changes in Accumulated Other Comprehensive Income (Loss)

The following table reflects the changes in accumulated other comprehensive income (loss) by component:

	Pension			Postretirement medical benefits			Foreign currency translation adjustment		Tax effect of other comprehensive income gains			Accumulated other comprehensive loss
	(In thousands)
Balance at December 31, 2013	$	(12,255	)	$	(20,292	)	$	—	$	(31,048	)	$	(63,595	)
Other comprehensive income (loss) before reclassifications	—			—			9,477		(224		)	9,253
Amounts reclassified from accumulated other comprehensive income (loss)	717			10			—		—			727
Balance at June 30, 2014	$	(11,538	)	$	(20,282	)	$	9,477	$	(31,272	)	$	(53,615	)

The following table reflects the reclassifications out of accumulated other comprehensive loss for the six months ended June 30, 2014 are as follows (in thousands):

Details about accumulated other comprehensive loss components	Amount reclassified from accumulated other comprehensive loss1						Affected line item in the statement where net income (loss) is presented
	Three Months Ended June 30, 2014			Six Months Ended June 30, 2014
Amortization of defined benefit pension items
Actuarial losses	$	359		$	717		2
Amortization of postretirement medical items
Prior service costs	$	(159	)	$	(318	)	3
Actuarial losses	164			328			3
Total	$	5		$	10

____________________

(1) Amounts in parentheses indicate debits to income/loss.

(2) These accumulated other comprehensive loss components are included in the computation of net periodic pension cost. (See Note 7 - Pension for additional details)

(3) These accumulated other comprehensive loss components are included in the computation of net periodic postretirement medical cost. (See Note 7 - Postretirement Medical Benefits for additional details)

Equity Offering

Subsequent to June 30, 2014, the Company completed a public offering of 1,684,507 shares of common stock at $35.50 per share for gross proceeds of $59.8 million. The Company intends to use the net proceeds of the offering to increase its overall financial flexibility, pursue organic and acquisition growth strategies and for general corporate purposes.

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HERITAGE HEALTH BENEFIT EXPENSES

6 Months Ended

Jun. 30, 2014

Heritage Health Benefit Expenses [Abstract]

HERITAGE HEALTH BENEFIT EXPENSES

HERITAGE HEALTH BENEFIT EXPENSES

The caption Heritage health benefit expenses used in the consolidated statements of operations refers to costs of benefits the Company provides to its former mining operation employees. The components of these expenses are as follows:

	Three Months Ended June 30,					Six Months Ended June 30,
	2014		2013			2014		2013
	(In thousands)					(In thousands)
Health care benefits	$	2,376	$	3,089		$	4,650	$	6,266
Combined benefit fund payments	512		576			1,025		1,152
Workers’ compensation benefits	124		117			260		232
Black lung benefits	376		(673		)	997		(590		)
Total	$	3,388	$	3,109		$	6,932	$	7,060

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ASSET RETIREMENT OBLIGATIONS, CONTRACTUAL THIRD-PARTY RECLAMATION RECEIVABLES, AND RECLAMATION DEPOSITS - Carrying Value and Estimated Fair Value of Reclamation Deposits (Detail) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Asset Retirement Obligation [Line Items]
Reclamation deposits	$ 75,911	$ 74,921
Carrying Value
Asset Retirement Obligation [Line Items]
Reclamation deposits	75,911
Carrying Value | Cash and cash equivalents | Level 1
Asset Retirement Obligation [Line Items]
Reclamation deposits	44,089
Carrying Value | Held-to-maturity securities | Level 2
Asset Retirement Obligation [Line Items]
Reclamation deposits	31,822
Fair Value
Asset Retirement Obligation [Line Items]
Reclamation deposits	76,690
Fair Value | Cash and cash equivalents | Level 1
Asset Retirement Obligation [Line Items]
Reclamation deposits	44,089
Fair Value | Held-to-maturity securities | Level 2
Asset Retirement Obligation [Line Items]
Reclamation deposits	$ 32,601

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LINES OF CREDIT AND LONG-TERM DEBT

6 Months Ended

Jun. 30, 2014

Debt Disclosure [Abstract]

LINES OF CREDIT AND LONG-TERM DEBT

LINES OF CREDIT AND DEBT

The amounts outstanding under the Company’s debt consisted of the following as of the dates indicated:

	Total Debt Outstanding
	June 30, 2014			December 31, 2013
	(In thousands)
10.75% Senior Notes due 2018	$	250,485		$	251,500
Add-On Notes - 10.75% senior notes due 2018	425,000			—
8.02% WML term debt due 2018	—			85,500
Capital lease obligations	133,240			10,153
Other	5,286			1,209
Debt premium (discount), net	19,033			(8,525		)
Total debt outstanding	833,044			339,837
Less current installments	(42,401		)	(44,343		)
Total debt outstanding, less current installments	$	790,643		$	295,494

The following table presents aggregate contractual debt maturities of all debt:

	As of June 30, 2014
	(In thousands)
2014	$	22,270
2015	41,290
2016	39,318
2017	25,776
2018	682,852
Thereafter	2,505
Total	814,011
Plus: debt premium (discount), net	19,033
Total debt	$	833,044

On February 7, 2014, the Company closed on a private offering of $425.0 million in aggregate principal amount of 10.75% senior notes due 2018 at a price of 106.875% plus accrued interest from February 1, 2014, referred to as the New Notes. Total proceeds of the offering were $454.2 million, which included $29.2 million of debt premium. The net proceeds of the offering of the New Notes were used to finance the $282.8 million initial cash payment for the Canadian Acquisition and cash transaction costs associated with the Canadian Acquisition and offering of the New Notes of approximately $24.0 million. The remaining balance of the proceeds were used to fund the prepayment of the WML Notes and for other general corporate purposes. In connection with the WML prepayment, the WML revolving credit facility was terminated. Upon the prepayment of the WML Notes, WML's assets constitute collateral for the senior notes.

Promptly following the completion of the Canadian Acquisition, the Company exchanged the New Notes for $425 million aggregate principal amount of add-on 10.75% senior secured notes due 2018, referred to as the Add-On Notes, and the Company became party to a registration rights agreement, pursuant to which the Company agreed to register with the Securities and Exchange Commission the exchange of Add-On Notes for registered notes with the same terms as the existing 10.75% Senior Notes due 2018. The Company will pay interest on the Add-On Notes semi-annually on February 1st and August 1st of each year beginning on August 1, 2014.

The Company amended its existing corporate revolving credit agreement to increase the maximum available borrowing amount to $60 million, The revolver may support up to $60 million of letters of credit, which would reduce the balance available under the revolver.

The Company capitalized debt issuance costs of $15.4 million during the six months ended June 30, 2014 related to the new senior notes and the amendment of its revolver.

During the six months ended June 30, 2014, the Company paid $1.0 million, excluding accrued interest, to repurchase Senior Notes with a principal amount of $1.0 million. The Company recognized losses of $0.1 million on these repurchases, which were recorded as losses on extinguishment of debt. The losses on the repurchases were measured based on the carrying value of the repurchased portion of the Senior Notes, which included a portion of the unamortized debt issue costs and the debt discount on the dates of repurchase.

Under the indenture governing the 10.75% Senior Notes, the Company is required to offer a portion of our Excess Cash Flow (as defined by the indenture) for each fiscal year to purchase some of these notes at 100% of the principal amount. The Company had $29.5 million of Excess Cash Flow for the year ended December 31, 2013 and offered $22.1 million for repurchase during the second quarter of 2014. As of December 31, 2013, the Company had classified $22.1 million of the outstanding 10.75% Senior Notes to Current installments of long-term debt related to the required Excess Cash Flow offering. The Excess Cash Flow offer expired by June 30, 2014 with $1.0 million of principal being repaid. The remaining $21.1 million was reclassified to Long-term debt, less current installments as of June 30, 2014.

During the six months ended June 30, 2014, the Company entered into $12.9 million of new capital leases at its Kemmerer Mine.

Additional information regarding the Company’s debt is outlined in Note 5 to the Consolidated Financial Statements in the Company's 2013 Annual Report on Form 10-K.

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POSTRETIREMENT MEDICAL BENEFITS AND PENSION

6 Months Ended

Jun. 30, 2014

Compensation and Retirement Disclosure [Abstract]

POSTRETIREMENT MEDICAL BENEFITS AND PENSION

POSTRETIREMENT MEDICAL BENEFITS AND PENSION

Postretirement Medical Benefits

The Company provides postretirement medical benefits to retired employees and their dependents as mandated by the Coal Industry Retiree Health Benefit Act of 1992 and pursuant to collective bargaining agreements. The Company also provides these benefits to qualified full-time employees pursuant to collective bargaining agreements.

The components of net periodic postretirement medical benefit cost are as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2013		2014		2013
	(In thousands)				(In thousands)
Components of net periodic benefit cost:
Service cost	$	822	$	1,109	$	1,645	$	2,218
Interest cost	3,203		3,035		6,407		6,069
Amortization of deferred items	4		1,001		9		2,003
Total net periodic benefit cost	$	4,029	$	5,145	$	8,061	$	10,290

The following table shows the net periodic postretirement medical benefit costs that relate to current and former mining operations:

	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2013		2014		2013
	(In thousands)				(In thousands)
Former mining operations	$	2,402	$	3,119	$	4,807	$	6,237
Current operations	1,627		2,026		3,254		4,053
Total net periodic benefit cost	$	4,029	$	5,145	$	8,061	$	10,290

The costs for the former mining operations are included in Heritage health benefit expenses and costs for current operations are included in Cost of sales and Selling and administrative expenses.

Pension

The Company provides pension benefits to qualified full-time employees pursuant to collective bargaining agreements.

The Company incurred net periodic benefit costs of providing these pension benefits as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
	(In thousands)						(In thousands)
Components of net periodic benefit cost:
Service cost	$	500		$	638		$	1,000		$	1,173
Interest cost	1,638			1,555			3,384			3,180
Expected return on plan assets	(2,154		)	(2,325		)	(4,307		)	(4,385		)
Amortization of deferred items	359			1,004			719			1,745
Total net periodic pension cost	$	343		$	872		$	796		$	1,713

These costs are included in Cost of sales and Selling and administrative expenses.

The Company contributed $1.1 million of cash contributions to its pension plans in the six months ended June 30, 2014 and expects to make $3.2 million of pension plan contributions during the remainder of 2014.

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ASSET RETIREMENT OBLIGATIONS, CONTRACTUAL THIRD-PARTY RECLAMATION RECEIVABLES, AND RECLAMATION DEPOSITS

6 Months Ended

Jun. 30, 2014

Asset Retirement Obligation Disclosure [Abstract]

ASSET RETIREMENT OBLIGATIONS, CONTRACTUAL THIRD-PARTY RECLAMATION RECEIVABLES, AND RECLAMATION DEPOSITS

ASSET RETIREMENT OBLIGATIONS, CONTRACTUAL THIRD-PARTY RECLAMATION RECEIVABLE AND RECLAMATION DEPOSITS

The asset retirement obligation, contractual third-party reclamation receivable, and reclamation deposits for each of the Company’s operating segments at June 30, 2014 are summarized below:

	Asset Retirement Obligation		Contractual Third-Party Reclamation Receivable		Reclamation Deposits
	(In thousands)
Coal - U.S.	$	281,346	$	95,157	$	75,911
Coal - Canada	107,111		6,739		—
Power	927		—		—
Total	$	389,384	$	101,896	$	75,911

Asset Retirement Obligations

Changes in the Company’s asset retirement obligations were as follows:

	Six Months Ended June 30,
	2014			2013
	(In thousands)
Asset retirement obligations, beginning of year (including current portion)	$	279,864		$	263,847
Accretion	14,003			10,951
Liabilities settled	(10,250		)	(11,647		)
ARO acquired	102,075			—
Changes due to foreign currency translation	3,692			—
Asset retirement obligations, end of period	389,384			263,151
Less current portion	(31,131		)	(24,105		)
Asset retirement obligations, less current portion	$	358,253		$	239,046

Contractual Third-Party Reclamation Receivables

At June 30, 2014, the Company has recognized as an asset of $101.9 million as contractual third-party reclamation receivables, representing the present value of customer obligations to reimburse the Company for future reclamation expenditures at the Company’s Rosebud, Jewett and Absaloka Mines.

Reclamation Deposits

The Company’s reclamation deposits will be used to fund final reclamation activities. The Company’s carrying value and estimated fair value of its reclamation deposits at June 30, 2014 are as follows:

	Carrying Value		Fair Value		Fair Value Hierarchy
	(In thousands)
Cash and cash equivalents	$	44,089	$	44,089	Level 1
Held-to-maturity securities	31,822		32,601		Level 2
	$	75,911	$	76,690

Held-to-Maturity Reclamation Deposits

The amortized cost, gross unrealized holding gains and losses and fair value of held-to-maturity securities at June 30, 2014 are as follows (in thousands):

Amortized cost	$	31,822
Gross unrealized holding gains	953
Gross unrealized holding losses	(174		)
Fair value	$	32,601

Maturities of held-to-maturity securities are as follows at June 30, 2014:

	Amortized Cost		Fair Value
	(In thousands)
Within one year	$	1,025	$	998
Due in five years or less	17,341		17,829
Due after five years to ten years	7,289		7,424
Due in more than ten years	6,167		6,350
	$	31,822	$	32,601

The Company does not intend to sell its held-to-maturity securities and it is not more likely than not that the Company will be required to sell the securities before recovery of amortized cost bases, which may be at maturity.

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FAIR VALUE MEASUREMENTS (Details) (Significant unobservable inputs, Level 3, USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Carrying Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Debt	$ 694,515	$ 328,473
Fair Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Debt	$ 726,146	$ 364,329

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SHAREHOLDERS' EQUITY AND ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) - Reclassifications out of Accumulated Other Comprehensive Income (Details) (Defined benefit plans adjustment, USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014		Jun. 30, 2014
Pension
Reclassification out of Accumulated Other Comprehensive Income [Line Items]
Actuarial losses	$ 359	[1],[2]	$ 717	[1],[2]
Postretirement Medical Benefits
Reclassification out of Accumulated Other Comprehensive Income [Line Items]
Prior service costs	(159)	[1],[3]	(318)	[1],[3]
Actuarial losses	164	[1],[3]	328	[1],[3]
Amortization of defined benefit pension and postretirement medical benefits	$ 5	[1]	$ 10	[1]

[1] Amounts in parentheses indicate debits to income/loss.

[2] These accumulated other comprehensive loss components are included in the computation of net periodic pension cost. (See Note 7 - Pension for additional details)

[3] These accumulated other comprehensive loss components are included in the computation of net periodic postretirement medical cost. (See Note 7 - Postretirement Medical Benefits for additional details)

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DERIVATIVE INSTRUMENTS (Details) (USD $)	3 Months Ended	6 Months Ended
	Jun. 30, 2014	Jun. 30, 2014
Not Designated as Hedging Instrument | Foreign Exchange Forward
Derivative [Line Items]
Number of foreign currency exchange forward contracts	2	2
Notional amount	$ 348,300,000	$ 348,300,000
Not Designated as Hedging Instrument | Foreign Exchange Forward | Gain (loss) on foreign exchange
Derivative [Line Items]
Gain (loss) on derivative, net	581,000	(6,209,000)
Not Designated as Hedging Instrument | Contracts to purchase power | Derivative loss
Derivative [Line Items]
Gain (loss) on derivative, net	(5,930,000)	(5,930,000)
Not Designated as Hedging Instrument | Contracts to purchase power | Other current liabilities
Derivative [Line Items]
Derivative Liability	140,000	140,000
Not Designated as Hedging Instrument | Contracts to purchase power | Other liabilities
Derivative [Line Items]
Derivative Liability	$ 5,790,000	$ 5,790,000
Minimum | Contracts to purchase power
Derivative [Line Items]
Contracted power price notional amount		41.05
Maximum | Contracts to purchase power
Derivative [Line Items]
Contracted power price notional amount		44.09

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FAIR VALUE MEASUREMENTS (Tables)

6 Months Ended

Jun. 30, 2014

Fair Value Disclosures [Abstract]

Estimated fair values of Company's debt

The estimated fair values of the Company’s debt with fixed interest rates are as follows:

	Carrying Value		Fair Value
	(In thousands)
December 31, 2013	$	328,473	$	364,329
June 30, 2014	$	694,515	$	726,146

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LINES OF CREDIT AND LONG-TERM DEBT - Outstanding Lines of Credit and Long-Term Debt (Detail) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Feb. 07, 2014	Dec. 31, 2013
Debt Instrument [Line Items]
Total debt outstanding	$ 833,044		$ 339,837
Less current portion	(42,401)		(44,343)
Total debt outstanding, less current installments	790,643		295,494
Senior Notes
Debt Instrument [Line Items]
Stated interest rate (percent)	10.75%
Capital Lease Obligations
Debt Instrument [Line Items]
Total debt outstanding	133,240		10,153
Other
Debt Instrument [Line Items]
Total debt outstanding	5,286		1,209
Debt premium (discount), net
Debt Instrument [Line Items]
Total debt outstanding	19,033		(8,525)
Senior Notes due 2018 | Senior Notes
Debt Instrument [Line Items]
Total debt outstanding	250,485		251,500
Less current portion			(22,100)
Total debt outstanding, less current installments	21,100
Stated interest rate (percent)	10.75%	10.75%	10.75%
Add On Notes - Senior Notes due 2018 | Senior Notes
Debt Instrument [Line Items]
Total debt outstanding	425,000		0
Stated interest rate (percent)	10.75%
WML Term Debt Due 2018 | Term Debt
Debt Instrument [Line Items]
Total debt outstanding	$ 0		$ 85,500
Stated interest rate (percent)	8.02%

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EARNINGS PER SHARE

6 Months Ended

Jun. 30, 2014

Earnings Per Share [Abstract]

EARNINGS PER SHARE

EARNINGS PER SHARE

Basic earnings (loss) per share has been computed by dividing the net income (loss) applicable to common shareholders by the weighted average number of shares of common stock outstanding during each period. Net income (loss) applicable to common shareholders includes the adjustment for net income or loss attributable to noncontrolling interest. Diluted earnings (loss) per share is computed by including the dilutive effect of common stock that would be issued assuming conversion or exercise of outstanding convertible notes and securities, stock options, stock appreciation rights, and restricted stock units. No such items were included in the computations of diluted loss per share in the six months ended June 30, 2014 and June 30, 2013 because the Company incurred a net loss applicable to common shareholders in these periods and the effect of inclusion would have been anti-dilutive.

The table below shows the number of shares that were excluded from the calculation of diluted loss per share because their inclusion would be anti-dilutive to the calculation:

	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2013		2014		2013
	(In thousands)
Convertible securities	$	654	$	1,093	$	654	$	1,093
Restricted stock units, stock options and SARs	674		862		674		862
Total shares excluded from diluted shares calculation	$	1,328	$	1,955	$	1,328	$	1,955

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INVENTORIES (Tables)

6 Months Ended

Jun. 30, 2014

Inventory Disclosure [Abstract]

Inventories

nventories consisted of the following:

	June 30, 2014			December 31, 2013
	(In thousands)
Coal stockpiles	$	61,663		$	543
Coal fuel inventories	5,319			6,161
Materials and supplies	86,946			34,233
Reserve for obsolete inventory	(774		)	(965		)
Total	$	153,154		$	39,972

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RESTRICTED INVESTMENTS AND BOND COLLATERAL - Maturities of Held-to-Maturity Securities (Detail) (Held-to-maturity securities, USD $) In Thousands, unless otherwise specified	Jun. 30, 2014
Held-to-maturity securities
Schedule of Held-to-maturity Securities [Line Items]
Within one year, Amortized cost	$ 1,212
Due in five years or less, Amortized cost	19,360
Due after five years to ten years, Amortized cost	8,897
Due in more than ten years, Amortized cost	5,251
Maturities of held-to-maturity securities, Amortized cost	34,720
Within one year, Fair Value	1,230
Due in five years or less, Fair Value	19,704
Due after five years to ten years, Fair Value	9,070
Due in more than ten years, Fair Value	5,255
Fair value	$ 35,259

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BASIS OF PRESENTATION - Additional Information (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended			6 Months Ended
	Jun. 30, 2014	Dec. 31, 2013	Jun. 30, 2014 PMRU Minimum	Jun. 30, 2014 PMRU Maximum	Jun. 30, 2014 Senior secured notes	Jun. 30, 2013 Other operating income
Debt Instrument [Line Items]
Debt arrangement					$ 675.5
Stated interest rate (percent)					10.75%
Business interruption insurance proceeds recorded in income						11.3
Cash proceeds from business interruption insurance	4.6
Finance income, recognition period			3 years	27 years
Liability for unrecognized tax benefits	$ 5.8	$ 0

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Consolidated Statements of Comprehensive Income (Loss) (Unaudited) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Statement of Comprehensive Income [Abstract]
Net income (loss)	$ (63,154)	$ 2,217	$ (82,185)	$ (1,870)
Other comprehensive income (loss):
Amortization of accumulated actuarial gains or losses, pension	359	1,004	717	1,745
Amortization of accumulated actuarial gains or losses, transition obligations, and prior service costs, postretirement medical benefit	5	1,001	10	2,002
Tax effect of other comprehensive income gains	64	0	(224)	0
Change in foreign currency translation adjustment	9,477	0	9,477	0
Unrealized and realized gains and losses on available-for-sale securities	0	(39)	0	(39)
Other comprehensive income	9,905	1,966	9,980	3,708
Comprehensive income (loss) attributable to the Parent company	$ (53,249)	$ 4,183	$ (72,205)	$ 1,838

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INVENTORIES

6 Months Ended

Jun. 30, 2014

Inventory Disclosure [Abstract]

INVENTORIES

INVENTORIES

Inventories consisted of the following:

	June 30, 2014			December 31, 2013
	(In thousands)
Coal stockpiles	$	61,663		$	543
Coal fuel inventories	5,319			6,161
Materials and supplies	86,946			34,233
Reserve for obsolete inventory	(774		)	(965		)
Total	$	153,154		$	39,972

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ASSET RETIREMENT OBLIGATIONS, CONTRACTUAL THIRD-PARTY RECLAMATION RECEIVABLES, AND RECLAMATION DEPOSITS - Summary of Asset Retirement Obligations, Contractual Third-Party Reclamation Receivables, and Reclamation Deposits (Detail) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013	Jun. 30, 2013	Dec. 31, 2012
Asset Retirement Obligation [Line Items]
Asset Retirement Obligation	$ 389,384	$ 279,864	$ 263,151	$ 263,847
Contractual Third- Party Reclamation Receivable	101,896
Reclamation deposits	75,911	74,921
Coal - U.S. Segment
Asset Retirement Obligation [Line Items]
Asset Retirement Obligation	281,346
Contractual Third- Party Reclamation Receivable	95,157
Reclamation deposits	75,911
Coal - Canada Segment
Asset Retirement Obligation [Line Items]
Asset Retirement Obligation	107,111
Contractual Third- Party Reclamation Receivable	6,739
Reclamation deposits	0
Power Segment
Asset Retirement Obligation [Line Items]
Asset Retirement Obligation	927
Contractual Third- Party Reclamation Receivable	0
Reclamation deposits	$ 0

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SHARE-BASED COMPENSATION - Summary of Restricted Stock Unit Activity (Detail) (Restricted Stock Units (RSUs), USD $) In Thousands, except Share data, unless otherwise specified	6 Months Ended
	Jun. 30, 2014
Restricted Stock Units (RSUs)
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Balance beginning of period (units)	588,727
Granted (units)	214,188
Vested (units)	(299,872)
Balance end of period (units)	503,043
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward]
Weighted Average Grant Date Fair Value, beginning of period (in USD per share)	$ 9.37
Weighted Average Grant Date Fair Value, Awards granted (in USD per share)	$ 0.00
Weighted Average Grant Date Fair Value, Awards vested (in USD per share)	$ 0.00
Weighted Average Grant Date Fair Value, end of period (in USD per share)	$ 8.64
Unamortized Compensation Expense	$ 5,605	[1]

[1] Expected to be recognized over the next three years.

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RESTRICTED INVESTMENTS AND BOND COLLATERAL (Tables)

6 Months Ended

Jun. 30, 2014

Disclosure Restricted Investments and Bond Collateral [Abstract]

Components of restricted investments and bond collateral

The Company’s restricted investments and bond collateral consist of the following:

	June 30, 2014		December 31, 2013
	(In thousands)
Coal - U.S. Segment:
WML debt reserve account	$	—	$	13,067
Reclamation bond collateral:
Kemmerer Mine	25,077		24,966
Absaloka Mine	11,696		11,653
Rosebud Mine	3,145		3,145
Beulah Mine	1,270		1,270
Coal - Canada Segment:
PMRU	16,201		—
CVRI	31,867		—
Power Segment:
Letter of credit account	—		5,998
Corporate Segment:
Postretirement medical benefit bonds	8,550		8,467
Workers’ compensation bonds	6,705		6,667
Total restricted investments and bond collateral	104,511		75,233
Less current portion	—		(5,998		)
Total restricted investments and bond collateral, less current portion	$	104,511	$	69,235

Carrying value and estimated fair value of restricted investments and bond collateral

The Company’s carrying value and estimated fair value of its restricted investments and bond collateral at June 30, 2014 are as follows:

	Carrying Value		Fair Value
	(In thousands)
Cash and cash equivalents	$	67,340	$	67,340
Time deposits	2,451		2,451
Held-to-maturity securities	34,720		35,259
	$	104,511	$	105,050

Amortized cost, gross unrealized holding gains and losses and fair value of held-to-maturity securities

The amortized cost, gross unrealized holding gains and fair value of held-to-maturity securities at June 30, 2014 is as follows (in thousands):

Amortized cost	$	34,720
Gross unrealized holding gains	628
Gross unrealized holding losses	(89		)
Fair value	$	35,259

Restricted Investments and Bond Collateral

Schedule of Held-to-maturity Securities [Line Items]

Maturities of held-to-maturity securities

Maturities of held-to-maturity securities are as follows at June 30, 2014:

	Amortized Cost		Fair Value
	(In thousands)
Due within one year	$	1,212	$	1,230
Due in five years or less	19,360		19,704
Due after five years to ten years	8,897		9,070
Due in more than ten years	5,251		5,255
	$	34,720	$	35,259

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BUSINESS SEGMENT INFORMATION - Reconciliation of Segment Operating Income to Income (Loss) (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Segment Reporting [Abstract]
Income (loss) from operations	$ (29,640)	$ 11,975	$ (21,588)	$ 17,710
Loss on extinguishment of debt	(12,635)	(64)	(12,635)	(64)
Interest expense	(21,786)	(10,076)	(42,584)	(20,236)
Interest income	1,582	280	1,884	577
Gain (loss) on foreign exchange	2,649	0	(4,141)	0
Other income	483	130	576	198
Income (loss) before income taxes	$ (59,347)	$ 2,245	$ (78,488)	$ (1,815)

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BUSINESS SEGMENT INFORMATION (Tables)

6 Months Ended

Jun. 30, 2014

Segment Reporting [Abstract]

Summarized financial information by segment

Summarized financial information by segment is as follows:

	Coal - U.S.			Coal - Canada(1)			Power			Heritage			Corporate			Consolidated
	(In thousands)
Three Months Ended June 30, 2014
Revenues	$	150,107		$	116,046		$	21,803		$	—		$	—		$	287,956
Restructuring charges	491			6,646			101			—			305			7,543
Depreciation, depletion, and amortization	13,283			8,671			2,486			—			39			24,479
Operating income (loss)	(423		)	(12,709		)	(9,473		)	(3,559		)	(3,476		)	(29,640		)
Total assets	670,375			687,185			165,763			15,664			44,734			1,583,721
Capital expenditures	6,533			7,495			220			—			63			14,311
Three Months Ended June 30, 2013
Revenues	$	139,337		$	—		$	23,162		$	—		$	—		$	162,499
Depreciation, depletion, and amortization	12,804			—			2,551			—			42			15,397
Operating income (loss)	12,572			—			4,837			(3,530		)	(1,904		)	11,975
Total assets	699,556			—			183,855			16,305			33,887			933,603
Capital expenditures	7,209			—			564			—			393			8,166
Six Months Ended June 30, 2014
Revenues	$	308,298		$	116,046		$	43,815		$	—		$	—		$	468,159
Restructuring charges	491			6,646			499			—			305			7,941
Depreciation, depletion, and amortization	26,780			8,671			5,009			—			78			40,538
Operating income (loss)	12,275			(12,709		)	(7,731		)	(7,389		)	(6,034		)	(21,588		)
Total assets	670,375			687,185			165,763			15,664			44,734			1,583,721
Capital expenditures	9,586			7,495			255			—			25			17,361
Six Months Ended June 30, 2013
Revenues	$	281,449		$	—		$	42,498		$	—		$	—		$	323,947
Depreciation, depletion, and amortization	24,658			—			5,081			—			84			29,823
Operating income (loss)	25,566			—			3,836			(7,705		)	(3,987		)	17,710
Total assets	699,556			—			183,855			16,305			33,887			933,603
Capital expenditures	12,219			—			698			—			550			13,467

Reconciliation of segment operating income to income (loss)

A reconciliation of segment income (loss) from operations to loss before income taxes follows:

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
	(In thousands)
Income (loss) from operations	$	(29,640	)	$	11,975		$	(21,588	)	$	17,710
Loss on extinguishment of debt	(12,635		)	(64		)	(12,635		)	(64		)
Interest expense	(21,786		)	(10,076		)	(42,584		)	(20,236		)
Interest income	1,582			280			1,884			577
Gain (loss) on foreign exchange	2,649			—			(4,141		)	—
Other income	483			130			576			198
Income (loss) before income taxes	$	(59,347	)	$	2,245		$	(78,488	)	$	(1,815	)

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SHARE-BASED COMPENSATION

6 Months Ended

Jun. 30, 2014

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

SHARE-BASED COMPENSATION

SHARE-BASED COMPENSATION

The Company grants employees and non-employee directors restricted stock units from the Amended and Restated 2007 Equity Incentive Stock Plan. The Amended and Restated 2007 Equity Incentive Stock Plan provides that non-employee directors will receive equity awards with a value of $90,000 after each annual meeting.

In June 2014, the Company began contributing Company stock to its 401(k) plan instead of cash.

The Company recognized compensation expense from share-based arrangements shown in the following table:

	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2013		2014		2013
	(In thousands)
Recognition of fair value of restricted stock units, stock options and SARs over vesting period; and issuance of stock	$	1,388	$	597	$	2,116	$	2,260
Contributions of stock to the Company's 401(k) plan	329		788		329		1,511
Total share-based compensation expense	$	1,717	$	1,385	$	2,445	$	3,771

Restricted Stock Units

A summary of restricted stock award activity for the six months ended June 30, 2014 is as follows:

	Units		Weighted Average Grant-Date Fair Value		Unamortized Compensation Expense (In thousands)
Non-vested at December 31, 2013	588,727		$	9.37
Granted	214,188		—
Vested	(299,872	)	—
Non-vested at June 30, 2014	503,043		$	8.64	$	5,605	(1)

____________________

(1) Expected to be recognized over the next three years.

Stock Options

A summary of stock option activity for the six months ended June 30, 2014 is as follows:

	Stock Options		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (In years)	Aggregate Intrinsic Value (In thousands)		Unamortized Compensation Expense (In thousands)
Outstanding at December 31, 2013	145,806		$	21.97
Exercised	(9,000	)	$	21.40
Expired	—		$	—
Outstanding and exercisable at June 30, 2014	136,806		$	22.01	3.7	$	1,953	$	—

There were no stock options granted during the six months ended June 30, 2014.

SARs

A summary of SARs activity for the six months ended June 30, 2014 is as follows:

	SARs		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (In years)	Aggregate Intrinsic Value (In thousands)		Unamortized Compensation Expense (In thousands)
Outstanding at December 31, 2013	70,734		$	22.60
Exercised	(36,291	)	$	21.30
Expired	—		$	—
Outstanding and exercisable at June 30, 2014	34,443		$	23.97	1.7	$	424	$	—

There were no SARs granted during the six months ended June 30, 2014.