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Note 8 - Leases

12 Months Ended

Dec. 31, 2024

NOTE 8—LEASES

The Company has various finance leases for mining equipment, which generally include 3-5 year terms and expire through 2028. In addition, we have two operating leases for office space with initial terms of approximately five and six years that run through 2027 and 2030, respectively, including the office space in Charleston, WV that commenced in the first quarter of 2024 resulting in the recognition of an additional right-of-use asset and lease liability of approximately $1 million.

Amortization of right-of-use assets associated with finance leases was $10.4 million, $8.5 million, and $4.8 million in 2024, 2023, and 2022, respectively, as discussed in Note 3. Interest expense recognized for financing lease liabilities was $0.9 million, $0.6 million, and $0.4 million in 2024, 2023, and 2022, respectively. Operating lease expense was $0.4 million in 2024, $0.2 million in 2023, and $0.2 million in 2022. Short-term lease costs were approximately $350 thousand in 2024 and were not material for prior periods.

Right-of-use assets and lease liabilities are determined as the present value of the lease payments, discounted using either the implicit interest rate in the lease or, more commonly, our estimated incremental borrowing rate based on similar terms, payments and the economic environment where the leased asset is located. Below is a summary of our leases:


(In thousands)	Classification	December 31, 2024		December 31, 2023

Right-of-use assets
Financing	Financing lease right-of-use assets, net	$	12,437	$	10,282
Operating	Other assets		1,324		540
Total right-of-use assets		$	13,761	$	10,822

Current lease liabilities
Financing	Current portion of financing lease obligations	$	6,218	$	5,456
Operating	Accrued liabilities		290		134
Non-current lease liabilities
Financing	Long-term financing lease obligations	$	7,517	$	4,915
Operating	Other long-term liabilities		1,091		450
Total lease liabilities		$	15,116	$	10,955

Minimum lease payments for our lease obligations are as follows:


	December 31, 2024
(In thousands)	Financing		Operating		Total

Future minimum lease payments:
2025	$	6,756	$	373	$	7,129
2026		4,694		381		5,075
2027		2,813		382		3,195
2028		548		226		774
2029		—		226		226
Thereafter		—		31		31
Total undiscounted lease payments		14,811		1,619		16,430
Less: Amounts representing interest		(1,076)		(238)		(1,314)
Present value of lease obligations	$	13,735	$	1,381	$	15,116

Weighted average remaining term (years)		2.6		4.5
Weighted average discount rate		7.0%		6.7%

During 2024, the Company also entered into a five-year lease of equipment for the purpose of reducing environmental waste, mainly water, incurred during certain mining operations, which is not reflected in the disclosures above because the commencement date has not occurred for accounting purposes as of December 31, 2024. The lease commenced in February 2025 subsequent to the date of the financial statements.

Coal Leases and Associated Royalty Commitments—Leases of mineral reserves and related land leases are exempt from the lease accounting requirements addressed above. Refer to Note 10 for information regarding coal leases and associated royalty commitments.