Intangible Assets

12 Months Ended

Dec. 31, 2012

Goodwill and Intangible Assets Disclosure [Abstract]

Intangible Assets

Intangible Assets

As described in Note 20, NACoal acquired Reed Minerals on August 31, 2012 for a preliminary purchase price of approximately $73.3 million, which includes preliminary estimated contingent consideration of up to $4.0 million. Of the preliminary purchase price, $8.2 million was allocated to identifiable intangible assets, including a coal supply agreement of $7.3 million and other intangibles of $0.9 million. Preliminary goodwill is $6.4 million. The allocation of the purchase price is preliminary as the Company has not yet finalized its analysis of the fair value of the contingent consideration and income taxes. Changes in the assumptions used to calculate the preliminary fair values will affect the allocation of the purchase price to the assets and liabilities of the acquisition. Accordingly, the preliminary amount allocated to goodwill is subject to change.

Intangible assets other than goodwill, which are subject to amortization, consist of the following:

	Gross Carrying Amount		Accumulated Amortization			Net Balance
Balance at December 31, 2012
Coal supply agreements	$	91.5	$	(29.0	)	$	62.5
Other intangibles	0.9		—			0.9
	$	92.4	$	(29.0	)	$	63.4
Balance at December 31, 2011
Coal supply agreement	$	84.2	$	(26.3	)	$	57.9

During 2010, NACoal finalized an agreement with Mississippi Power Company to provide lignite coal from its Liberty Mine to the a power plant currently being built in Mississippi. Upon the execution of this agreement, the Company determined that its intangible asset at the Mississippi Lignite Mining Company was impaired. Accordingly, the Company recorded an impairment charge of $0.7 million for other intangible assets at NACoal during 2010.

Amortization expense for intangible assets was $2.8 million, $2.1 million and $3.5 million in 2012, 2011 and 2010, respectively. Amortization expense for 2010 includes an impairment charge of $0.7 million for other intangible assets at NACoal.

Expected annual amortization expense of other intangible assets for the next five years is as follows: $3.8 million in 2013, $3.6 million in 2014 and $3.8 million in 2015, 2016 and 2017, respectively. The weighted average amortization period for intangible assets is approximately 28 years.