Note 3. Income Taxes

6 Months Ended

Jun. 30, 2011

Income Tax Disclosure [Text Block]

Note 3.Income Taxes

Major components of our income tax provision for the three months and six months ended June 30, 2011 and 2010 are as follows (in thousands):

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2011		2010		2011		2010
Current:
Federal	$	4,111	$	1,530	$	4,111	$	1,359
State		478		230		478		169
Foreign		115		115		230		230
Total current income tax provision		4,704		1,875		4,819		1,758
Deferred:
Federal and state deferred income tax provision		14,938		6,380		38,319		7,928
Discrete benefit for change in valuation allowance attributable to future periods		-		-		-		(7,660	)
Total deferred income tax provision		14,938		6,380		38,319		268
Total income tax provision	$	19,642	$	8,255	$	43,138	$	2,026

           Our ability to utilize our deferred tax assets depends on future taxable income generated from operations. For the six months ended June 30, 2011, there were no circumstances that caused us to change our assessment of the ability to generate future taxable income to realize the currently recognized deferred tax assets.  After utilization of $38 million for the first six months of the year, the net deferred tax asset at June 30, 2011 was $149 million. It is possible that the valuation allowance on our deferred tax asset will change in the future as a result of the analysis of our long-range forecasts, with a resulting tax provision.

The current income tax provisions for the three- and six-month periods ended June 30, 2011 and 2010 vary from the amounts that would have resulted from applying the statutory income tax rate to pre-tax income primarily due to the effects of percentage depletion for all periods presented and the change in valuation allowance during the six-month period ended June 30, 2010.