☒
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
☐
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Delaware
|
77-0695453
|
(State or other jurisdiction of incorporation or organization)
|
(I.R.S. Employer Identification No.)
|
9540 South Maroon Circle, Suite 300 Englewood, CO
|
80112
|
(Address of principal executive offices)
|
(Zip Code)
|
Large accelerated filer
|
o
|
|
Accelerated filer
|
o
|
Non-accelerated filer
|
x
|
|
Smaller reporting company
|
o
|
|
|
|
Emerging growth company
|
o
|
|
Page
|
|
|
||
|
June 30, 2018
|
|
December 31, 2017
|
||||
|
(In thousands)
|
||||||
Assets
|
|
||||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
28,233
|
|
|
$
|
36,739
|
|
Receivables
|
21,020
|
|
|
27,409
|
|
||
Inventories
|
13,676
|
|
|
14,927
|
|
||
Other current assets
|
7,099
|
|
|
1,891
|
|
||
Total current assets
|
70,028
|
|
|
80,966
|
|
||
Property, plant and equipment:
|
|
|
|
||||
Land, mineral rights, property, plant and equipment
|
208,385
|
|
|
358,375
|
|
||
Less accumulated depreciation, depletion and amortization
|
(82,348
|
)
|
|
(164,711
|
)
|
||
Net property, plant and equipment
|
126,037
|
|
|
193,664
|
|
||
Advanced coal royalties
|
3,990
|
|
|
10,143
|
|
||
Restricted investments
|
35,811
|
|
|
37,239
|
|
||
Intangible assets, net of accumulated amortization of $6.2 million at December 31, 2017
|
—
|
|
|
24,800
|
|
||
Deposits and other assets
|
904
|
|
|
592
|
|
||
Total Assets
|
$
|
236,770
|
|
|
$
|
347,404
|
|
Liabilities and Partners’ Capital (Deficit)
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Current installments of long-term debt
|
$
|
318,950
|
|
|
$
|
314,228
|
|
Accounts payable and accrued expenses:
|
|
|
|
||||
Trade
|
15,326
|
|
|
15,565
|
|
||
Deferred revenue
|
2,037
|
|
|
3,141
|
|
||
Production taxes
|
15,535
|
|
|
16,670
|
|
||
Asset retirement obligations
|
11,124
|
|
|
15,187
|
|
||
Other current liabilities
|
2,317
|
|
|
2,091
|
|
||
Total current liabilities
|
365,289
|
|
|
366,882
|
|
||
Long-term debt, less current installments
|
7,345
|
|
|
9,605
|
|
||
Asset retirement obligations, less current portion
|
30,808
|
|
|
30,609
|
|
||
Other liabilities
|
1,711
|
|
|
1,942
|
|
||
Total liabilities
|
405,153
|
|
|
409,038
|
|
||
Partners’ capital (deficit):
|
|
|
|
||||
Limited partners (1,284,840 units outstanding as of June 30, 2018 and December 31, 2017)
|
20,024
|
|
|
25,959
|
|
||
Series A convertible units (17,050,680 units outstanding as of June 30, 2018 and December 31, 2017)
|
(149,068
|
)
|
|
(69,605
|
)
|
||
Series B convertible units (4,512,500 units outstanding as of June 30, 2018 and December 31, 2017)
|
(70,784
|
)
|
|
(49,755
|
)
|
||
General partner units (35,291 units outstanding as of June 30, 2018 and December 31, 2017)
|
31,529
|
|
|
31,687
|
|
||
Liquidation units (856,698 units outstanding as of June 30, 2018 and December 31, 2017)
|
—
|
|
|
—
|
|
||
Accumulated other comprehensive income
|
(84
|
)
|
|
80
|
|
||
Total Westmoreland Resource Partners, LP deficit
|
(168,383
|
)
|
|
(61,634
|
)
|
||
Total Liabilities and Partners’ Deficit
|
$
|
236,770
|
|
|
$
|
347,404
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
|
(In thousands, except per unit data)
|
||||||||||||||
Revenues
|
$
|
64,295
|
|
|
$
|
81,051
|
|
|
$
|
132,102
|
|
|
$
|
155,856
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
||||||||
Cost of sales (exclusive of depreciation, depletion and amortization, shown separately)
|
54,065
|
|
|
59,812
|
|
|
109,691
|
|
|
119,228
|
|
||||
Depreciation, depletion and amortization
|
9,189
|
|
|
10,110
|
|
|
17,354
|
|
|
20,461
|
|
||||
Selling and administrative
|
7,008
|
|
|
3,714
|
|
|
12,919
|
|
|
7,611
|
|
||||
Loss (gain) on sales of assets
|
(1,169
|
)
|
|
(220
|
)
|
|
(1,068
|
)
|
|
(362
|
)
|
||||
Loss on impairment
|
77,675
|
|
|
—
|
|
|
77,675
|
|
|
—
|
|
||||
Total cost and expenses
|
146,768
|
|
|
73,416
|
|
|
216,571
|
|
|
146,938
|
|
||||
Operating (loss) income
|
(82,473
|
)
|
|
7,635
|
|
|
(84,469
|
)
|
|
8,918
|
|
||||
Other (expense) income:
|
|
|
|
|
|
|
|
||||||||
Interest expense
|
(11,609
|
)
|
|
(10,653
|
)
|
|
(22,959
|
)
|
|
(21,132
|
)
|
||||
Interest income
|
239
|
|
|
233
|
|
|
498
|
|
|
439
|
|
||||
Other income
|
84
|
|
|
433
|
|
|
293
|
|
|
608
|
|
||||
Total other expenses
|
(11,286
|
)
|
|
(9,987
|
)
|
|
(22,168
|
)
|
|
(20,085
|
)
|
||||
Net loss
|
(93,759
|
)
|
|
(2,352
|
)
|
|
(106,637
|
)
|
|
(11,167
|
)
|
||||
Less net loss allocated to general partner
|
(140
|
)
|
|
(4
|
)
|
|
(158
|
)
|
|
(17
|
)
|
||||
Net loss allocated to limited partners
|
$
|
(93,619
|
)
|
|
$
|
(2,348
|
)
|
|
$
|
(106,479
|
)
|
|
$
|
(11,150
|
)
|
|
|
|
|
|
|
|
|
||||||||
Net loss
|
$
|
(93,759
|
)
|
|
$
|
(2,352
|
)
|
|
$
|
(106,637
|
)
|
|
$
|
(11,167
|
)
|
Unrealized and realized (loss) gain on available-for-sale debt securities
|
(97
|
)
|
|
105
|
|
|
(164
|
)
|
|
251
|
|
||||
Comprehensive loss attributable to the Partnership
|
$
|
(93,856
|
)
|
|
$
|
(2,247
|
)
|
|
$
|
(106,801
|
)
|
|
$
|
(10,916
|
)
|
|
|
|
|
|
|
|
|
||||||||
Net loss per limited partner common unit, basic and diluted:
|
$
|
(4.10
|
)
|
|
$
|
(0.08
|
)
|
|
$
|
(4.66
|
)
|
|
$
|
(0.45
|
)
|
|
|
|
|
|
|
|
|
||||||||
Weighted average number of limited partner common units outstanding, basic and diluted:
|
1,285
|
|
|
1,285
|
|
|
1,285
|
|
|
1,264
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Cash distribution paid per limited partner common unit
|
$
|
—
|
|
|
$
|
0.1333
|
|
|
$
|
—
|
|
|
$
|
0.2666
|
|
Cash distribution paid per general partner unit
|
—
|
|
|
0.1333
|
|
|
—
|
|
|
0.2666
|
|
|
Limited Partners
|
|
|
|
|
|
|
|
Total Partners' Capital (Deficit)
|
||||||||||||||||||||||||||||||||||||||||
|
Common
|
|
Series A Convertible
|
|
Series B Convertible
|
|
Liquidation
|
|
Total
|
|
General Partner
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
|||||||||||||||||||||||||||||||||||
|
Units
|
|
Capital (Deficit)
|
|
Units
|
|
Capital (Deficit)
|
|
Units
|
|
Capital (Deficit)
|
|
Units
|
|
Capital (Deficit)
|
|
Units
|
|
Capital (Deficit)
|
|
Units
|
|
Capital (Deficit)
|
|
|
||||||||||||||||||||||||
|
(In thousands, except units data)
|
||||||||||||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2017
|
1,284,840
|
|
|
$
|
25,959
|
|
|
17,050,680
|
|
|
$
|
(69,605
|
)
|
|
4,512,500
|
|
|
$
|
(49,755
|
)
|
|
856,698
|
|
|
$
|
—
|
|
|
23,704,718
|
|
|
$
|
(93,401
|
)
|
|
35,291
|
|
|
$
|
31,687
|
|
|
$
|
80
|
|
|
$
|
(61,634
|
)
|
Net loss
|
—
|
|
|
(5,987
|
)
|
|
—
|
|
|
(79,463
|
)
|
|
—
|
|
|
(21,029
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(106,479
|
)
|
|
—
|
|
|
(158
|
)
|
|
—
|
|
|
(106,637
|
)
|
||||||||
Equity-based compensation
|
—
|
|
|
52
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
52
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
52
|
|
||||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(164
|
)
|
|
(164
|
)
|
||||||||
Balance at June 30, 2018
|
1,284,840
|
|
|
$
|
20,024
|
|
|
17,050,680
|
|
|
$
|
(149,068
|
)
|
|
4,512,500
|
|
|
$
|
(70,784
|
)
|
|
856,698
|
|
|
$
|
—
|
|
|
23,704,718
|
|
|
$
|
(199,828
|
)
|
|
35,291
|
|
|
$
|
31,529
|
|
|
$
|
(84
|
)
|
|
$
|
(168,383
|
)
|
|
Six Months Ended June 30,
|
||||||
|
2018
|
|
2017
|
||||
|
(In thousands)
|
||||||
Cash flows from operating activities:
|
|
|
|
||||
Net loss
|
$
|
(106,637
|
)
|
|
$
|
(11,167
|
)
|
Adjustments to reconcile net loss to net cash provided by operating activities:
|
|
|
|
||||
Depreciation, depletion and amortization
|
17,354
|
|
|
20,461
|
|
||
Accretion of asset retirement obligations
|
3,551
|
|
|
2,672
|
|
||
Equity-based compensation
|
52
|
|
|
81
|
|
||
Loss on impairment
|
77,675
|
|
|
—
|
|
||
Non-cash interest expense
|
4,782
|
|
|
4,639
|
|
||
Amortization of deferred financing costs
|
1,362
|
|
|
1,421
|
|
||
Other
|
(1,068
|
)
|
|
(1,263
|
)
|
||
Changes in operating assets and liabilities:
|
|
|
|
||||
Receivables, net
|
6,389
|
|
|
3,202
|
|
||
Inventories
|
1,251
|
|
|
867
|
|
||
Accounts payable and accrued expenses
|
1,374
|
|
|
2,679
|
|
||
Interest payable
|
226
|
|
|
21
|
|
||
Deferred revenue
|
(1,104
|
)
|
|
(1,375
|
)
|
||
Other assets and liabilities
|
(3,221
|
)
|
|
2,721
|
|
||
Asset retirement obligations
|
(5,260
|
)
|
|
(5,219
|
)
|
||
Net cash provided by operating activities
|
(3,274
|
)
|
|
19,740
|
|
||
Cash flows from investing activities:
|
|
|
|
||||
Additions to property, plant, equipment and other
|
(3,151
|
)
|
|
(7,054
|
)
|
||
Advance royalties payments
|
(98
|
)
|
|
(318
|
)
|
||
Proceeds from sales of restricted investments
|
5,939
|
|
|
6,981
|
|
||
Purchases of restricted investments
|
(4,395
|
)
|
|
(8,854
|
)
|
||
Net proceeds from sales of assets
|
600
|
|
|
608
|
|
||
Net cash provided by (used in) investing activities
|
(1,105
|
)
|
|
(8,637
|
)
|
||
Cash flows from financing activities:
|
|
|
|
||||
Repayments of long-term debt
|
(3,845
|
)
|
|
(2,620
|
)
|
||
Cash distributions to unitholders
|
—
|
|
|
(388
|
)
|
||
Acquisition under common control of Johnson Run
|
—
|
|
|
(1,526
|
)
|
||
Net cash used in financing activities
|
(3,845
|
)
|
|
(4,534
|
)
|
||
Net (decrease) increase in cash and cash equivalents, including restricted cash
|
(8,224
|
)
|
|
6,569
|
|
||
Cash and cash equivalents, including restricted cash, beginning of period
|
44,493
|
|
|
23,675
|
|
||
Cash and cash equivalents, including restricted cash, end of period
|
$
|
36,269
|
|
|
$
|
30,244
|
|
Supplemental disclosures of cash flow information:
|
|
|
|
||||
Cash paid for interest
|
$
|
16,495
|
|
|
$
|
15,174
|
|
Non-cash transactions:
|
|
|
|
||||
Accrued purchases of property and equipment
|
$
|
738
|
|
|
$
|
332
|
|
Economic value of Series A convertible unit distributions
|
—
|
|
|
2,124
|
|
||
|
|
|
|
||||
Cash and cash equivalents, including restricted cash, end of period
|
|
|
|
||||
Cash and cash equivalents
|
$
|
28,233
|
|
|
$
|
23,096
|
|
Restricted cash in
Restricted investments
|
8,036
|
|
|
7,148
|
|
||
|
$
|
36,269
|
|
|
$
|
30,244
|
|
|
Six Months Ended June 30, 2017
|
||
|
(In thousands)
|
||
Cash used in investing activities, as previously reported
|
$
|
(7,204
|
)
|
Less: Purchases of restricted investments
|
(1,433
|
)
|
|
Cash used in investing activities, as adjusted
|
$
|
(8,637
|
)
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
Type of Revenue
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Coal sales
|
$
|
60,032
|
|
|
$
|
79,817
|
|
|
$
|
126,741
|
|
|
$
|
152,924
|
|
Other revenues
|
4,263
|
|
|
1,234
|
|
|
5,361
|
|
|
2,932
|
|
||||
Total
|
$
|
64,295
|
|
|
$
|
81,051
|
|
|
$
|
132,102
|
|
|
$
|
155,856
|
|
Contract Liabilities
(1)
:
|
|
||
Balance as of December 31, 2017
|
$
|
3,141
|
|
Additions
|
1,441
|
|
|
Transfers to
Revenues
|
(2,545
|
)
|
|
Balance as of June 30, 2018
|
$
|
2,037
|
|
|
Estimated Revenues
|
||
Six months ended December 31, 2018
|
$
|
83,853
|
|
2019
|
73,340
|
|
|
2020
|
69,680
|
|
|
2021
|
51,727
|
|
|
2022
|
—
|
|
|
Thereafter
|
—
|
|
|
Total
|
$
|
278,600
|
|
|
June 30, 2018
|
|
December 31, 2017
|
||||
|
(In thousands)
|
||||||
Coal stockpiles
|
$
|
3,539
|
|
|
$
|
4,642
|
|
Materials and supplies
|
10,420
|
|
|
10,569
|
|
||
Reserve for obsolete inventory
|
(283
|
)
|
|
(284
|
)
|
||
Total
|
$
|
13,676
|
|
|
$
|
14,927
|
|
|
June 30, 2018
|
|
December 31, 2017
|
||||
|
(In thousands)
|
||||||
Cash and cash equivalents
|
$
|
8,036
|
|
|
$
|
7,754
|
|
Available-for-sale debt securities
|
27,775
|
|
|
29,485
|
|
||
|
$
|
35,811
|
|
|
$
|
37,239
|
|
|
June 30, 2018
|
|
December 31, 2017
|
||||
|
(In thousands)
|
||||||
Cost basis
|
$
|
27,859
|
|
|
$
|
29,405
|
|
Gross unrealized holding gains
|
330
|
|
|
409
|
|
||
Gross unrealized holding losses
|
(414
|
)
|
|
(329
|
)
|
||
Fair value
|
$
|
27,775
|
|
|
$
|
29,485
|
|
•
|
AEP Generation Resources Inc. (“AEP”) declined the Partnership’s bid to supply coal to AEP’s Conesville Power Plant Units 5 and 6 for periods subsequent to the expiration of the parties' current contract which expires on December 31, 2018. Coal sales under Oxford’s current coal supply contract to AEP’s Conesville Power Plant Units 5 and 6 represented a substantial portion of the Partnership's revenues generated from the Ohio mines for the year ended December 31, 2017.
|
|
Asset Impairment Charges
|
||
|
(In thousands)
|
||
Land, mineral rights, property, plant and equipment, net
|
$
|
50,717
|
|
Advanced coal royalties
|
3,145
|
|
|
Intangible assets, net of accumulated amortization of $7.2 million at June 30, 2018
|
23,767
|
|
|
Other assets
|
46
|
|
|
|
$
|
77,675
|
|
|
June 30, 2018
|
|
December 31, 2017
|
||||
|
(In thousands)
|
||||||
Term Loan
|
$
|
315,945
|
|
|
$
|
312,734
|
|
Capital lease obligations
|
11,477
|
|
|
13,478
|
|
||
Other
|
265
|
|
|
375
|
|
||
Total debt outstanding
|
327,687
|
|
|
326,587
|
|
||
Less debt issuance costs
|
(1,392
|
)
|
|
(2,754
|
)
|
||
Less current installments, net of debt issuance costs
|
(318,950
|
)
|
|
(314,228
|
)
|
||
Total debt outstanding, less current installments
|
$
|
7,345
|
|
|
$
|
9,605
|
|
|
June 30, 2018
|
||
|
(In thousands)
|
||
2018
|
$
|
318,084
|
|
2019
|
4,174
|
|
|
2020
|
1,766
|
|
|
2021
|
1,664
|
|
|
2022
|
1,999
|
|
|
Thereafter
|
—
|
|
|
Total debt
|
$
|
327,687
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Limited partner common units
|
$
|
—
|
|
|
$
|
171
|
|
|
$
|
—
|
|
|
$
|
334
|
|
General partner units
|
—
|
|
|
5
|
|
|
—
|
|
|
10
|
|
||||
Warrants
|
—
|
|
|
22
|
|
|
—
|
|
|
44
|
|
•
|
Level 1, defined as observable inputs such as quoted prices in active markets for identical assets. Level 1 assets include available-for-sale debt securities generally valued based on independent third-party market prices.
|
•
|
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.
|
|
Fixed Interest Rate
|
|
Variable Interest Rate
|
||||||||||||
|
Carrying Value
|
|
Fair Value
|
|
Carrying Value
|
|
Fair Value
|
||||||||
|
(In thousands)
|
||||||||||||||
June 30, 2018
|
$
|
11,741
|
|
|
$
|
11,741
|
|
|
$
|
314,554
|
|
|
$
|
70,862
|
|
December 31, 2017
|
13,853
|
|
|
13,853
|
|
|
309,980
|
|
|
144,536
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
|
(In thousands)
|
||||||||||||||
Recognition of fair value of restricted common units over the vesting period
|
$
|
—
|
|
|
$
|
39
|
|
|
$
|
52
|
|
|
$
|
81
|
|
|
Units
|
|
Weighted Average Grant-Date Fair Value
|
|
Unamortized Compensation Expense
(In thousands)
|
|||||
Unvested balance at December 31, 2017
|
82,240
|
|
|
$
|
3.04
|
|
|
|
||
Granted
|
—
|
|
|
—
|
|
|
|
|||
Vested and issued
|
—
|
|
|
—
|
|
|
|
|||
Unvested balance at June 30, 2018
|
82,240
|
|
|
$
|
3.04
|
|
|
$
|
—
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Net loss attributable to the Partnership
|
$
|
(93,759
|
)
|
|
$
|
(2,352
|
)
|
|
$
|
(106,637
|
)
|
|
$
|
(11,167
|
)
|
Less:
|
|
|
|
|
|
|
|
||||||||
Paid and declared distributions on Series A convertible units
|
—
|
|
|
2,200
|
|
|
—
|
|
|
4,362
|
|
||||
Series A convertible units share of undistributed loss
|
(69,864
|
)
|
|
(3,504
|
)
|
|
(79,463
|
)
|
|
(11,726
|
)
|
||||
Series B convertible units share of undistributed loss
|
(18,490
|
)
|
|
(964
|
)
|
|
(21,029
|
)
|
|
(3,265
|
)
|
||||
Paid and declared distributions on general partner units
|
—
|
|
|
5
|
|
|
—
|
|
|
10
|
|
||||
General partner units share of undistributed loss
|
(140
|
)
|
|
(8
|
)
|
|
(158
|
)
|
|
(26
|
)
|
||||
Paid and declared distributions on warrants
|
—
|
|
|
22
|
|
|
—
|
|
|
44
|
|
||||
Undistributed net loss attributable to limited partners
|
$
|
(5,265
|
)
|
|
$
|
(103
|
)
|
|
$
|
(5,987
|
)
|
|
$
|
(566
|
)
|
|
|
|
|
|
|
|
|
||||||||
Weighted average number of limited partner common units outstanding used in computation of limited partners' net loss per common unit (basic and diluted)
|
1,285
|
|
|
1,285
|
|
|
1,285
|
|
|
1,264
|
|
||||
Net loss per limited partner common unit, basic and diluted
|
$
|
(4.10
|
)
|
|
$
|
(0.08
|
)
|
|
$
|
(4.66
|
)
|
|
$
|
(0.45
|
)
|
|
Accumulated Other Comprehensive Income
|
||
|
(In thousands)
|
||
Balance at December 31, 2017
|
$
|
80
|
|
Other comprehensive loss before reclassification
|
(271
|
)
|
|
Amounts reclassified from accumulated other comprehensive income
|
107
|
|
|
Balance at June 30, 2018
|
$
|
(84
|
)
|
|
|
Amount Reclassified From Accumulated Other Comprehensive Income
|
|
|
||||||
Details About Accumulated Other Comprehensive Income Components
|
|
Three Months Ended June 30, 2018
|
|
Six Months Ended June 30, 2018
|
|
Affected Line Item in the Statement Where Net Loss is Presented
|
||||
|
|
(In thousands)
|
|
|||||||
Realized gains on available-for-sale debt securities
|
|
$
|
16
|
|
|
$
|
107
|
|
|
Other income
|
•
|
Our ability to adhere to our financial and other covenants, including those waived through September 8, 2018 by the most recent waiver we have obtained from our lenders, and to repay our debts, including our Term Loan which matures December 31, 2018, as they become due;
|
•
|
Risks associated with our general partner, including our dependence on our general partner and its affiliates, including Westmoreland Coal Company, to manage and provide resources for our operations;
|
•
|
Our ability to secure customer contracts to replace revenue from expiring contracts;
|
•
|
Adverse impacts to our business as a result of the audit opinion of our independent auditor containing an explanatory paragraph referencing our conclusion that substantial doubt exists as to our ability to continue as a going concern contained within our
2017
Form 10-K;
|
•
|
Our substantial level of indebtedness, liquidity issues and potential to seek restructuring transactions;
|
•
|
Existing and future environmental legislation and regulation affecting both our coal mining operations and our customers’ coal usage, governmental policies and taxes, including those aimed at reducing emissions of elements such as mercury, sulfur dioxides, nitrogen oxides, particulate matter or greenhouse gases;
|
•
|
The effects of limited protections during adverse economic conditions within certain provisions in our long-term supply contracts;
|
•
|
The concentration of revenues derived from a small number of customers, and the creditworthiness of those customers;
|
•
|
Changes in the demand or pricing for coal;
|
•
|
Our relationships with, and other conditions affecting, our customers, including how power prices and consumption patterns affect our customers’ decisions to run their plants;
|
•
|
Our ability to fund necessary capital expenditures for the maintenance and continued productivity of our mines;
|
•
|
Inaccuracies in our estimates of our coal reserves and/or an inability to secure adequate replacement reserves;
|
•
|
Potential title defects or loss of leasehold interests in our properties, which could result in unanticipated costs or an inability to mine the properties;
|
•
|
Risks associated with cybersecurity and data leakage;
|
•
|
The impacts of climate change concerns;
|
•
|
Business interruptions, including unplanned equipment failures, geological, hydrological or other conditions, and competition and/or conflicts with other resource extraction activities, caused by external factors;
|
•
|
Natural disasters and events, including blizzards, earthquakes, drought, floods, fire and storms, not all of which are covered by insurance;
|
•
|
Extensive government regulations, including existing and potential future legislation, treaties and regulatory requirements, particularly in Northern Appalachia and the Illinois Basin;
|
•
|
Inaccuracies in our estimates of reclamation and/or mine closure obligations;
|
•
|
Potential limitations in obtaining bonding capacity and/or increases in our mining costs as a result of increased bonding expenses;
|
•
|
The availability and costs of key supplies or commodities, such as transportation, key equipment and materials;
|
•
|
Competition within our industry and with producers of competing energy sources;
|
•
|
Our ability to pay our quarterly distributions, which substantially depends upon our future operating performance (which may be affected by prevailing economic conditions in the coal industry), debt covenants, and financial, business and other factors, some of which are beyond our control;
|
•
|
Risks associated with our common units;
|
•
|
Changes in our tax position as a result of changes in tax law, certain tax positions we have taken, or our status as a publicly traded partnership; and
|
•
|
Other factors that are described under the heading “Risk Factors” found in our reports filed with the SEC, including our Annual Reports on Form 10-K and our Quarterly Reports on Form 10-Q.
|
•
|
Ohio Market.
Our operations in Ohio are exposed to changes in the price of coal sold on the open market. The price of coal has been, and continues to be, volatile and, in the last few years, has generally been adversely influenced by reduced demand, political pressures, and the price of competing products, including natural gas, that are used in energy production. While approximately 69% of our coal tons are sold under supply contracts that are more than one year in duration, terms can vary significantly and may have pricing provisions that may increase or decrease the price of our coal based on broad economic indicators. Demand pressure has resulted in depressed revenues, net income and Adjusted EBITDA in our Ohio market. Whether volume softness in this region persist in future periods is dependent upon fluctuations in market demand in those regions.
|
•
|
Weather.
Weather conditions are inherently unpredictable and could have positive or negative impacts on operating conditions. During the first quarter of 2017, our operations in Wyoming experienced unusually high amounts of precipitation, which restricted our ability to supply coal and lowered our coal tons sold and our revenues. These unfavorable weather patterns did not recur in the 2018 period.
|
•
|
Impairment Charges.
During the second quarter of 2018, we recognized impairment charges of
$77.7 million
related to the write-down of certain assets, as described in
Note 5. Loss On Impairment
. As a result of these charges, the remaining depreciable value of our assets is lower, which will result in lower depreciation, depletion and amortization expense in future periods.
|
•
|
Contract Expiration.
On June 14, 2018, we were notified by our primary customer at the Oxford mine that such customer would not renew its coal supply contract related to the Conesville Power Plant Units 5 and 6 after the current contract ends on December 31, 2018. While we endeavor to secure additional coal supply contracts to replace volumes lost at the end of this contract, there can be no guarantee we will be successful. Coal sales under Oxford’s current coal supply contract to AEP’s Conesville Power Plant Units 5 and 6 represented a substantial portion of the Partnership's revenues generated from the Ohio mines for the year ended December 31, 2017.
|
•
|
Capital Structure Review.
In light of the December 31, 2018 maturity of our Term Loan, we and our parent affiliate, WCC, proactively engaged separate financial advisors to assess the capital structures of our respective companies. Management and our Board, with the assistance of our advisors, are evaluating options to address the upcoming Term Loan maturity. Costs associated with this process were
$2.7 million
and
$4.7 million
during the three and
six months ended June 30, 2018
, respectively. This evaluation is ongoing and could result in, among other things, an amendment or restructuring of our existing debt, the sale of some or all of our assets, or, if we are unsuccessful in addressing the maturity of our debt, it may be necessary for us to seek a private restructuring or protection from creditors under Chapter 11 of the United States Bankruptcy Code.
|
Summary Financial Data
|
Three Months Ended June 30,
|
|
Increase / (Decrease)
|
|||||||||||
|
2018
|
|
2017
|
|
$
|
|
%
|
|||||||
|
(In millions)
|
|||||||||||||
Revenues
|
$
|
64.3
|
|
|
$
|
81.1
|
|
|
$
|
(16.8
|
)
|
|
(20.7
|
)%
|
Operating (loss) income
|
$
|
(82.5
|
)
|
|
$
|
7.6
|
|
|
$
|
(90.1
|
)
|
|
*
|
|
Net loss
|
$
|
(93.8
|
)
|
|
$
|
(2.4
|
)
|
|
$
|
(91.4
|
)
|
|
(3,808.3
|
)%
|
Adjusted EBITDA
1
|
$
|
7.6
|
|
|
$
|
18.9
|
|
|
$
|
(11.3
|
)
|
|
(59.8
|
)%
|
|
|
|
|
|
|
|
|
|||||||
Tons sold
|
1.4
|
|
|
1.9
|
|
|
(0.5
|
)
|
|
(26.3
|
)%
|
Summary Financial Data
|
Six Months Ended June 30,
|
|
Increase / (Decrease)
|
|||||||||||
|
2018
|
|
2017
|
|
$
|
|
%
|
|||||||
|
(In millions)
|
|||||||||||||
Revenues
|
$
|
132.1
|
|
|
$
|
155.9
|
|
|
$
|
(23.8
|
)
|
|
(15.3
|
)%
|
Operating (loss) income
|
$
|
(84.5
|
)
|
|
$
|
8.9
|
|
|
$
|
(93.4
|
)
|
|
*
|
|
Net loss
|
$
|
(106.6
|
)
|
|
$
|
(11.2
|
)
|
|
$
|
(95.4
|
)
|
|
(851.8
|
)%
|
Adjusted EBITDA
1
|
$
|
17.7
|
|
|
$
|
31.8
|
|
|
$
|
(14.1
|
)
|
|
(44.3
|
)%
|
|
|
|
|
|
|
|
|
|||||||
Tons sold
|
3.0
|
|
|
3.6
|
|
|
(0.6
|
)
|
|
(16.7
|
)%
|
•
|
is used widely by investors to measure a company’s operating performance without regard to items excluded from the calculation of such term, 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;
|
•
|
is used by rating agencies, lenders and other parties to evaluate our creditworthiness; and
|
•
|
helps 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.
|
•
|
does not reflect our cash expenditures or future requirements for capital and major maintenance expenditures or contractual commitments;
|
•
|
does not reflect income tax expenses or the cash requirements necessary to pay income taxes;
|
•
|
does not reflect changes in, or cash requirements for, our working capital needs; and
|
•
|
does not reflect the significant interest expense, or the cash requirements necessary to service interest or principal payments, on certain of our debt obligations.
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
|
(In thousands)
|
||||||||||||||
Reconciliation of Adjusted EBITDA and Distributable Cash Flow to Net Loss
|
|
|
|
|
|
|
|
||||||||
Net loss
|
$
|
(93,759
|
)
|
|
$
|
(2,352
|
)
|
|
$
|
(106,637
|
)
|
|
$
|
(11,167
|
)
|
Interest expense, net of interest income
|
11,370
|
|
|
10,420
|
|
|
22,461
|
|
|
20,693
|
|
||||
Depreciation, depletion and amortization
|
9,189
|
|
|
10,110
|
|
|
17,354
|
|
|
20,461
|
|
||||
Accretion of ARO
|
1,748
|
|
|
1,337
|
|
|
3,551
|
|
|
2,672
|
|
||||
EBITDA
|
(71,452
|
)
|
|
19,515
|
|
|
(63,271
|
)
|
|
32,659
|
|
||||
Advisory fees
1
|
2,679
|
|
|
—
|
|
|
4,651
|
|
|
—
|
|
||||
Loss on impairment
|
77,675
|
|
|
—
|
|
|
77,675
|
|
|
—
|
|
||||
Loss (gain) on sale of assets
|
(1,169
|
)
|
|
(220
|
)
|
|
(1,068
|
)
|
|
(362
|
)
|
||||
Unit-based compensation
|
—
|
|
|
39
|
|
|
52
|
|
|
81
|
|
||||
Other non-cash and non-recurring costs
2
|
(84
|
)
|
|
(433
|
)
|
|
(293
|
)
|
|
(608
|
)
|
||||
Adjusted EBITDA
|
7,649
|
|
|
18,901
|
|
|
17,746
|
|
|
31,770
|
|
||||
Deferred revenue
|
(2,545
|
)
|
|
(3,821
|
)
|
|
(1,104
|
)
|
|
(1,375
|
)
|
||||
Reclamation and mine closure costs
|
(3,140
|
)
|
|
(3,334
|
)
|
|
(5,260
|
)
|
|
(5,207
|
)
|
||||
Maintenance capital expenditures and other
|
(1,630
|
)
|
|
(3,903
|
)
|
|
(3,151
|
)
|
|
(7,054
|
)
|
||||
Cash interest expense, net of interest income
|
(8,151
|
)
|
|
(7,513
|
)
|
|
(15,997
|
)
|
|
(14,735
|
)
|
||||
Distributable Cash Flow
|
$
|
(7,817
|
)
|
|
$
|
330
|
|
|
$
|
(7,766
|
)
|
|
$
|
3,399
|
|
|
Six Months Ended June 30,
|
||||||
|
2018
|
|
2017
|
||||
|
(In thousands)
|
||||||
Net cash provided by (used in):
|
|
|
|
||||
Operating activities
|
$
|
(3,274
|
)
|
|
$
|
19,740
|
|
Investing activities
|
(1,105
|
)
|
|
(8,637
|
)
|
||
Financing activities
|
(3,845
|
)
|
|
(4,534
|
)
|
|
|
|
|
Incorporated by Reference
|
|
|
||||||
Exhibit Number
|
|
Exhibit Description
|
|
Form
|
|
File Number
|
|
Exhibit
|
|
Filing Date
|
|
Filed or Furnished Herewith
|
|
Waiver and Amendment No. 4 to Financing Agreement by and among Westmoreland Resource Partners, LP and each of its subsidiaries, the lenders party there to and U.S. Bank National Association, dated as of March 1, 2018
|
|
|
|
|
|
|
|
|
|
X
|
|
|
Waiver and Amendment No. 5 to Financing Agreement by and among Westmoreland Resource Partners, LP and each of its subsidiaries, the lenders party there to and U.S. Bank National Association, dated as of June 15, 2018
|
|
|
|
|
|
|
|
|
|
X
|
|
|
Certification of Chief Executive Officer pursuant to Rule 13a-14(a)
|
|
|
|
|
|
|
|
|
|
X
|
|
|
Certification of Principal Financial Officer pursuant to Rule 13a-14(a)
|
|
|
|
|
|
|
|
|
|
X
|
|
|
Certifications of Chief Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. Section 1350
|
|
|
|
|
|
|
|
|
|
X
|
|
|
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
|
|
|
WESTMORELAND RESOURCE PARTNERS, LP
|
|
|
|
By:
|
WESTMORELAND RESOURCES GP, LLC, its general partner
|
|
|
|
|
Date:
|
August 3, 2018
|
By:
|
/s/ Scott A. Henry
|
|
|
|
Scott A. Henry
|
|
|
|
Controller and Principal Accounting Officer
|
|
|
|
(Principal Financial Officer and A Duly Authorized Officer)
|
BORROWER:
|
OXFORD MINING COMPANY, LLC
By: /s/ Samuel N. Hagreen Name: Samuel N. Hagreen Title: Secretary and Associate General Counsel |
GUARANTORS:
|
WESTMORELAND RESOURCE PARTNERS, LP
By Westmoreland Resources GP, LLC, its general partner By: /s/ Samuel N. Hagreen
Name: Samuel N. Hagreen
Title: Secretary and Associate General Counsel
|
OXFORD MINING COMPANY-KENTUCKY, LLC
By: /s/ Samuel N. Hagreen
Name: Samuel N. Hagreen
Title: Secretary and Associate General Counsel
|
DARON COAL COMPANY, LLC
By: /s/ Samuel N. Hagreen Name: Samuel N. Hagreen
Title: Secretary and Associate General Counsel
|
OXFORD CONESVILLE, LLC
By: /s/ Samuel N. Hagreen Name: Samuel N. Hagreen
Title: Secretary and Associate General Counsel
|
HARRISON RESOURCES, LLC
By: /s/ Samuel N. Hagreen Name: Samuel N. Hagreen
Title: Secretary and Associate General Counsel
|
WESTMORELAND KEMMERER FEE COAL HOLDINGS, LLC
By: /s/ Samuel N. Hagreen Name: Samuel N. Hagreen
Title: Secretary and Associate General Counsel
|
WESTMORELAND KEMMERER, LLC
By: /s/ Samuel N. Hagreen Name: Samuel N. Hagreen
Title: Secretary and General Counsel
|
COLLATERAL AGENT AND ADMINISTRATIVE AGENT:
|
U.S. BANK NATIONAL ASSOCIATION, as Administrative Agent and Collateral Agent
By: /s/ Lisa Dowd Name: Lisa Dowd Title: Vice President |
LENDERS:
|
TENNENBAUM OPPORTUNITIES PARTNERS V, LP
TENNENBAUM OPPORTUNITIES FUND VI, LLC, each as Lenders
By: Tennenbaum Capital Partners, LLC, its Investment Manager
By: /s/ Howard Levkowitz Name: Howard Levkowitz Title: Managing Partner |
LENDERS:
|
BF OXFORD SPE LLC
By: /s/ Adam L. Gubner
Name: Adam L. Gubner
Title: Authorized Person
GCF OXFORD SPE LLC
By: /s/ Adam L. Gubner
Name: Adam L. Gubner
Title: Authorized Person
TOF OXFORD SPE LLC
By: /s/ Adam L. Gubner
Name: Adam L. Gubner
Title: Authorized Person
|
LENDER:
|
MEDLEY CAPITAL CORPORATION
By: MCC Advisors LLC,
a Delaware limited liability company
its investment manager
By: /s/ Richard T. Allorto, Jr. Name: Richard T. Allorto, Jr. Title: Chief Financial Officer |
LENDER:
|
SIERRA INCOME CORPORATION
By: SIC Advisors LLC,
a Delaware limited liability company
its investment manager
By:
/s/ Christopher M. Mathieu
Name: Christopher M. Mathieu Title: Treasurer |
LENDER:
|
BLACKROCK CAPITAL INVESTMENT CORPORATION
By: /s/ Marshall Merriman Name: Marshall Merriman Title: Managing Director |
WESTMORELAND COAL COMPANY
By: /s/ Michael G. Hutchinson Name: Michael G. Hutchinson Title: Interim Chief Executive Officer |
BORROWER:
|
OXFORD MINING COMPANY, LLC
By: /s/ Samuel N. Hagreen Name: Samuel N. Hagreen Title: Secretary and Associate General Counsel |
GUARANTORS:
|
WESTMORELAND RESOURCE PARTNERS, LP
By Westmoreland Resources GP, LLC, its general partner By: /s/ Samuel N. Hagreen
Name: Samuel N. Hagreen
Title: Secretary and Associate General Counsel
|
OXFORD MINING COMPANY-KENTUCKY, LLC
By: /s/ Samuel N. Hagreen
Name: Samuel N. Hagreen
Title: Secretary and Associate General Counsel
|
DARON COAL COMPANY, LLC
By: /s/ Samuel N. Hagreen
Name: Samuel N. Hagreen
Title: Secretary and Associate General Counsel
|
OXFORD CONESVILLE, LLC
By: /s/ Samuel N. Hagreen
Name: Samuel N. Hagreen
Title: Secretary and Associate General Counsel
|
HARRISON RESOURCES, LLC
By: /s/ Samuel N. Hagreen
Name: Samuel N. Hagreen
Title: Secretary and Associate General Counsel
|
DOC ID - 28287574.4
|
|
|
WESTMORELAND KEMMERER FEE COAL HOLDINGS, LLC
By: /s/ Samuel N. Hagreen
Name: Samuel N. Hagreen
Title: Secretary and Associate General Counsel
|
WESTMORELAND KEMMERER, LLC
By: /s/ Samuel N. Hagreen
Name: Samuel N. Hagreen
Title: Secretary and General Counsel
|
DOC ID - 28287574.4
|
|
|
COLLATERAL AGENT AND ADMINISTRATIVE AGENT:
|
U.S. BANK NATIONAL ASSOCIATION, as Administrative Agent and Collateral Agent
By:
/s/ Lisa Dowd
Name: Lisa Dowd Title: Vice President |
DOC ID - 28287574.4
|
|
|
LENDERS:
|
TENNENBAUM OPPORTUNITIES PARTNERS V, LP
TENNENBAUM OPPORTUNITIES FUND VI, LLC, each as Lenders
By: Tennenbaum Capital Partners, LLC, its Investment Manager
By:
/s/ Howard Levkowitz
Name: Howard Levkowitz Title: Managing Partner |
DOC ID - 28287574.4
|
|
|
LENDERS:
|
BF OXFORD SPE LLC
By: /s/ Adam L. Gubner
Name: Adam L. Gubner
Title: Authorized Person
GCF OXFORD SPE LLC
By: /s/ Adam L. Gubner
Name: Adam L. Gubner
Title: Authorized Person
TOF OXFORD SPE LLC
By: /s/ Adam L. Gubner
Name: Adam L. Gubner
Title: Authorized Person
|
LENDER:
|
MEDLEY CAPITAL CORPORATION
By: MCC Advisors LLC,
a Delaware limited liability company
its investment manager
By: /s/ Richard T. Allorto, Jr. Name: Richard T. Allorto, Jr. Title: Chief Financial Officer |
LENDER:
|
SIERRA INCOME CORPORATION
By: SIC Advisors LLC,
a Delaware limited liability company
its investment manager
By:
/s/ Christopher M. Mathieu
Name: Christopher M. Mathieu Title: Treasurer |
LENDER:
|
BLACKROCK CAPITAL INVESTMENT CORPORATION
By: /s/ Marshall Merriman Name: Marshall Merriman Title: Managing Director |
WESTMORELAND COAL COMPANY
By: /s/ Michael G. Hutchinson Name: Michael G. Hutchinson Title: Interim Chief Executive Officer |
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Westmoreland Resource Partners, LP;
|
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:
|
August 3, 2018
|
/s/ Michael G. Hutchinson
|
|
|
|
Name:
|
Michael G. Hutchinson
|
|
|
Title:
|
Interim Chief Executive Officer
|
|
|
|
(Principal Executive Officer)
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Westmoreland Resource Partners, LP;
|
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:
|
August 3, 2018
|
/s/ Scott A. Henry
|
|
|
|
Name:
|
Scott A. Henry
|
|
|
Title:
|
Controller and Principal Accounting Officer
|
|
|
|
(Principal Financial Officer and A Duly Authorized Officer)
|
Date:
|
August 3, 2018
|
/s/ Michael G. Hutchinson
|
|
|
|
Name:
|
Michael G. Hutchinson
|
|
|
Title:
|
Interim Chief Executive Officer
|
|
|
|
(Principal Executive Officer)
|
|
|
|
|
Date:
|
August 3, 2018
|
/s/ Scott A. Henry
|
|
|
|
Name:
|
Scott A. Henry
|
|
|
Title:
|
Controller and Principal Accounting Officer
|
|
|
|
(Principal Financial Officer and A Duly Authorized Officer)
|
Westmoreland Resources Partners, LP
|
||||||||||||||
10-Q Safety Statistics
|
||||||||||||||
Quarter Ended June 30, 2018
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
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)
|
||
Kemmerer Mine
|
|
|
|
|
|
|
|
|
|
|
|
|
||
48-00086
|
2
|
—
|
—
|
—
|
—
|
$
|
1,526
|
|
—
|
No
|
No
|
1
|
—
|
—
|
Oxford Mine
|
|
|
|
|
|
|
|
|
|
|
|
|
||
33-03907
|
2
|
—
|
—
|
—
|
—
|
$
|
3,615
|
|
—
|
No
|
No
|
2
|
—
|
—
|
(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, 2018
.
|
(7)
|
Total number of mining-related fatalities during the quarter ended
June 30, 2018
.
|
(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, 2018
that fall into each of the following categories is as follows:
|