Note 3. Income Taxes

9 Months Ended

Sep. 30, 2011

Income Tax Disclosure [Text Block]

Note 3.   Income Taxes

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

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2011		2010		2011		2010
Current:
Federal	$	3,854	$	4,392	$	7,965	$	5,751
State		886		1,772		1,364		1,941
Foreign		115		115		344		344
Total current income tax provision		4,855		6,279		9,673		8,036
Deferred:
Federal and state deferred income tax provision		22,470		1,801		60,790		9,729
Discrete benefit for change in valuation allowance attributable to future periods		—		—		—		(7,659	)
Total deferred income tax provision		22,470		1,801		60,790		2,070
Total income tax provision	$	27,325	$	8,080	$	70,463	$	10,106

Our ability to utilize our deferred tax assets depends on future taxable income generated from operations. For the nine months ended September 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 $61 million during the first nine months of 2011, the net deferred tax asset at September 30, 2011 was $127 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 nine-month periods ended September 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 nine-month period ended September 30, 2010.