Mine Closure and Asset Impairment Costs

12 Months Ended

Dec. 31, 2012

Restructuring and Related Activities [Abstract]

Restructuring and Related Activities Disclosure [Text Block]

Mine Closure and Asset Impairment Costs

In response to decreasing demand for thermal coal, the Company made the decision in the second quarter of 2012 to close four thermal coal mining complexes and to temporarily idle a fifth complex, all acquired with ICG. The company also curtailed production at other Appalachia mines. These actions resulted in a total workforce reduction of approximately 750 positions. The Company will incur customary annual maintenance costs related to these properties in the future. The terms of customer contracts will be fulfilled by other operations.

The following costs are reflected in the line “Mine closure and asset impairment costs” on the consolidated statements of operations for the year ended December 31, 2012:



Parts and supplies inventory writedown	$	2,598
Impairment of property, plant and equipment	95,641
Impairment of coal properties and deferred development costs	403,279
Royalty obligations	11,546
Employee termination benefits	12,274
Pension, postretirement and occupational disease curtailment gain, net (see notes 17 and 18)	(1,770		)
	$	523,568

The Company determined that assets of the closed operations with a net book value of $51 million could be redeployed to other operations. The remainder of the assets were determined to be completely impaired, based on an analysis of the marketability of thermal coal properties in the current market environment.

The majority of the employee termination benefits were paid in the third quarter of 2012. The royalty obligations represent minimum payments on various leases and will be paid over the remaining term of the leases, through 2016.

The $7.3 million in asset impairment costs for the year ended December 31, 2011 related to a preparation plant and loadout of an acquired ICG mining operation that would not be used in ongoing operations.

- Definition

The entire disclosure for restructuring and related activities. Description of restructuring activities such as exit and disposal activities, include facts and circumstances leading to the plan, the expected plan completion date, the major types of costs associated with the plan activities, total expected costs, the accrual balance at the end of the period, and the periods over which the remaining accrual will be settled.

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