Leases

12 Months Ended

Dec. 31, 2023

Leases

Leases

19. 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 three 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, 2023 and December 31, 2022, the Company had the following ROU assets and lease liabilities within the Company’s Consolidated Balance Sheets:

		December 31,		December 31,
		2023		2022
Assets	Balance Sheet Classification
Operating lease right-of-use assets	Other noncurrent assets	$	9,626	$	12,106
Financing lease right-of-use assets	Other noncurrent assets		1,621		2,918
Total Lease Assets		$	11,247	$	15,024
Liabilities	Balance Sheet Classification
Financing lease liabilities - current	Accrued expenses and other current liabilities	$	1,041	$	977
Operating lease liabilities - current	Accrued expenses and other current liabilities		2,789		2,722
Financing lease liabilities - long-term	Other noncurrent liabilities		2,079		3,121
Operating lease liabilities - long-term	Other noncurrent liabilities		7,351		9,993
		$	13,260	$	16,813
Weighted average remaining lease term in years
Operating leases			3.32		4.14
Finance leases			1.25		2.25
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,
		2023		2022
	(In thousands)
Operating lease information:
Operating lease cost		$	3,263	$	3,323
Operating cash flows from operating leases			3,356		3,389
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, 2023 were as follows:

	Operating		Finance
Year	Leases		Leases
	(In thousands)
2024	$	3,281	$	1,210
2025		3,266		2,111
2026		3,080		—
2027		1,533		—
2028		—		—
Thereafter		—		—
Total minimum lease payments	$	11,160	$	3,321
Less imputed interest		(1,020)		(201)
Total lease liabilities	$	10,140	$	3,120

Rental expense, including amounts related to these operating leases and other shorter-term arrangements, amounted to $12.8 million in 2023, $10.4 million in 2022 and $8.1 million in 2021.

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 $177.1 million in 2023, $189.7 million in 2022, and $127.8 million in 2021.

As of December 31, 2023, certain of the Company’s lease obligations were secured by outstanding surety bonds totaling $40.4 million.