Leases

12 Months Ended

Dec. 31, 2022

Leases

Leases

22. Leases

The Company has operating and finance leases for mining equipment, office equipment and office space with remaining lease terms ranging from less than one year to approximately six years. Some of these leases include both lease and non-lease components which are accounted for as a single lease component as the Company has elected the practical expedient to combine these components for all leases. As most of the leases do not provide an implicit rate, the Company calculated the Right-of-use (“ROU”) assets and lease liabilities using its’ secured incremental borrowing rate at the lease commencement date.

As of December 31, 2022 and December 31, 2021, the Company had the following ROU assets and lease liabilities within the Company’s Consolidated Balance Sheets:

		December 31,		December 31,
		2022		2021
Assets	Balance Sheet Classification
Operating lease right-of-use assets	Other noncurrent assets	$	12,106	$	14,646
Financing lease right-of-use assets	Other noncurrent assets		2,918		4,215
Total Lease Assets		$	15,024	$	18,861
Liabilities	Balance Sheet Classification
Financing lease liabilities - current	Accrued expenses and other current liabilities	$	977	$	917
Operating lease liabilities - current	Accrued expenses and other current liabilities		2,722		2,606
Financing lease liabilities - long-term	Other noncurrent liabilities		3,121		4,097
Operating lease liabilities - long-term	Other noncurrent liabilities		9,993		12,713
		$	16,813	$	20,333
Weighted average remaining lease term in years
Operating leases			4.14		5.14
Finance leases			2.25		3.25
Weighted average discount rate
Operating leases			5.5%		5.5%
Finance leases			6.4%		6.4%

Information related to leases was as follows:

		Year Ended December 31,
		2022		2021
	(In thousands)
Operating lease information:
Operating lease cost		$	3,323	$	3,364
Operating cash flows from operating leases			3,389		3,377
Financing lease information:
Financing lease cost		$	1,572	$	1,572
Operating cash flows from financing leases			1,210		1,210

Future minimum lease payments under non-cancellable leases as of December 31, 2022 were as follows:

	Operating		Finance
Year	Leases		Leases
	(In thousands)
2023	$	3,356	$	1,210
2024		3,200		1,210
2025		3,185		2,111
2026		3,080		—
2027		1,533		—
Thereafter		—		—
Total minimum lease payments	$	14,354	$	4,531
Less imputed interest		(1,639)		(433)
Total lease liabilities	$	12,715	$	4,098

Rental expense, including amounts related to these operating leases and other shorter-term arrangements, amounted to $11.5 million in 2022, $9.2 million in 2021 and $8.6 million in 2020.

Royalties are paid to lessors either as a fixed price per ton or as a percentage of the gross selling price of the mined coal. Royalties under the majority of the Company’s significant leases are paid on the percentage of gross selling price basis. Royalty expense, including production royalties, was $189.7 million in 2022, $127.8 million in 2021, and $103.7 million in 2020.

As of December 31, 2022, certain of the Company’s lease obligations were secured by outstanding surety bonds totaling $31.8 million.