8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT PURSUANT TO

SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of report (Date of earliest event reported): June 22, 2006

ALLIANCE RESOURCE PARTNERS, L.P.

(Exact name of registrant as specified in its charter)

Delaware	Commission	73-1564280
(State or other jurisdiction of incorporation or organization)	File No.: 0-26823	(IRS Employer Identification No.)

1717 South Boulder Avenue, Suite 600, Tulsa, Oklahoma 74119

(Address of principal executive offices and zip code)

(918) 295-7600

(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligations of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

ITEM 7.01.   REGULATION FD DISCLOSURE.

In accordance with General Instruction B.2 of Form 8-K, the following information and the exhibits referenced therein is being furnished pursuant to Item 7.01 of Form 8-K and is not deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, is not subject to the liabilities of that section and is not deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.

On June 19, 2006, Alliance Resource Partners, L.P. and Alliance Holdings GP, L.P. announced that Brian L. Cantrell, the Senior Vice President and Chief Financial Officer of each limited partnership, will make a presentation at the 16^th Annual Wachovia Securities Nantucket Equity Conference in Massachusetts at 1:00 p.m. Eastern time on Thursday, June 22, 2006.

The audio portion of Mr. Cantrell’s presentation will be available via live webcast and for replay for 90 days at http://www.wsw.com/webcast/wa36/arlp. A copy of the press release and presentation materials are attached hereto as, respectively, Exhibit 99.1 and Exhibit 99.2.

ITEM 9.01   FINANCIAL STATEMENTS AND EXHIBITS

(d) Exhibits

99.1	Alliance Resource Partners, L.P. and Alliance Holdings GP, L.P. press release dated as of June 19, 2006.
99.2	Presentation materials for the 16th Annual Wachovia Securities Nantucket Equity Conference.

2

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	Alliance Resource Partners, L.P.
By:	Alliance Resource Management GP, LLC, its managing general partner

By:	/s/ Joseph W. Craft III
	Joseph W. Craft III
	President and Chief Executive Officer

Date: June 22, 2006

3

EX-99.1

Exhibit 99.1

PRESS RELEASE

FOR IMMEDIATE RELEASE CONTACT:
Brian L. Cantrell
Alliance Holdings GP, L.P.
Alliance Resource Partners, L.P.
1717 South Boulder Avenue, Suite 600
Tulsa, Oklahoma 74119
(918) 295-7673

Alliance CFO to Present at 16^th Annual Wachovia Securities Nantucket Equity Conference

Tulsa, Oklahoma, June 19, 2006 – Alliance Resource Partners, L.P. (NASDAQ: ARLP) and Alliance Holdings GP, L.P. (NASDAQ: AHGP) today announced that Brian L. Cantrell, Senior Vice President and Chief Financial Officer, will make a presentation at the 16^th Annual Wachovia Securities Nantucket Equity Conference in Massachusetts at 1:00 p.m. Eastern time on Thursday, June 22, 2006. In his presentation, Mr. Cantrell intends to discuss the operations, financial performance, growth prospects and business outlook for both Alliance Resource Partners, L.P. and Alliance Holdings GP, L.P.

The audio portion of Mr. Cantrell’s presentation will be available via live webcast and for replay for 90 days at http://www.wsw.com/webcast/wa36/arlp. The related presentation materials will be available June 22, 2006 on both Alliance Resource’s website (http://www.arlp.com) and Alliance Holdings’ website (http://www.ahgp.com) under “Investor Information” and “Investor Presentations.”

The statements and projections used throughout this release are based on current expectations. These statements and projections are forward-looking, and actual results may differ materially. These projections do not include the potential impact of any mergers, acquisitions or other business combinations that may occur after the date of this release. At the end of this release, we have included more information regarding business risks that could affect our results.

About Alliance Resource Partners, L.P.

Alliance Resource Partners, L.P. is a diversified producer and marketer of steam coal to major United States utilities and industrial users. Alliance Resource Partners, the nation’s only publicly traded master limited partnership involved in the production and marketing of coal, is currently the fifth largest coal producer in the eastern United States with operations in all major eastern coalfields. Alliance Resource Partners currently operates underground mining complexes in Illinois, Indiana, Kentucky, Maryland and West Virginia.

Partnership news, unit prices and additional information about Alliance Resource Partners, including filings with the Securities and Exchange Commission, are available at http://www.arlp.com. For more information, contact Alliance Resource Partners investor relations department at 918-295-7674 or via e-mail at investorrelations@arlp.com.

-MORE-

About Alliance Holdings GP, L.P.

Alliance Holdings GP, L.P. is a limited partnership formed to own and control Alliance Resource Management GP, LLC, the managing general partner of Alliance Resource Partners, L.P., through which it holds a 1.98% general partner interest and the incentive distribution rights in Alliance Resource Partners, L.P. In addition, Alliance Holdings GP, L.P. owns 15,550,628 common units of Alliance Resource Partners, L.P.

Partnership news, unit prices and additional information about Alliance Holdings GP, including filings with the Securities and Exchange Commission, are available at http://www.ahgp.com. For more information, contact Alliance Resource Partners investor relations department at 918-295-1415 or via e-mail at investorrelations@ahgp.com.

Contact for both Alliance Resource Partners, L.P. and Alliance Holdings GP. L.P.:

Brian L. Cantrell

1717 South Boulder Avenue, Suite 600

Tulsa, Oklahoma 74119

(918) 295-7673

FORWARD-LOOKING STATEMENTS: With the exception of historical matters, any matters discussed in this press release are forward-looking statements that involve risks and uncertainties that could cause actual results of Alliance Resource Partners, L.P. (“ARLP”) and, in turn, Alliance Holdings, GP, L.P. to differ materially from projected results. These risks, uncertainties and contingencies include, but are not limited to, the following: increased competition in coal markets and ARLP’s ability to respond to the competition; fluctuation in coal prices, which could adversely affect ARLP’s operating results and cash flows; risks associated with the expansion of ARLP’s operations and properties; deregulation of the electric utility industry or the effects of any adverse change in the domestic coal industry, electric utility industry, or general economic conditions; dependence on significant customer contracts, including renewing customer contracts upon expiration of existing contracts; customer bankruptcies and/or cancellations or breaches of existing contracts; customer delays or defaults in making payments; fluctuations in coal demand, prices and availability due to labor and transportation costs and disruptions, equipment availability, governmental regulations and other factors; ARLP’s productivity levels and margins that ARLP earn on its coal sales; greater than expected increases in raw material costs; greater than expected shortage of skilled labor; any unanticipated increases in labor costs, adverse changes in work rules, or unexpected cash payments associated with post-mine reclamation and workers’ compensation claims; any unanticipated increases in transportation costs and risk of transportation delays or interruptions; greater than expected environmental regulation, costs and liabilities; a variety of operational, geologic, permitting, labor and weather-related factors; risk associated with major mine-related accidents, such as mine fires or other interruptions; results of litigation; difficulty maintaining ARLP’s surety bonds for mine reclamation as well as workers’ compensation and black lung benefits; difficulty obtaining commercial property insurance, and risks associated with ARLP’s participation (excluding any applicable deductible) in the commercial insurance property program; and, a loss or reduction of the direct or indirect benefit from certain state and federal tax credits, including non-conventional source fuel tax credits.

Additional information concerning these and other factors can be found in the Partnership’s public periodic filings with the Securities and Exchange Commission (“SEC”), including the Partnership’s Annual Report on Form 10-K for the year ended December 31, 2005, filed on March 16, 2006 with the SEC and Alliance Holdings GP, L.P.’s Prospectus on Form 424B4 filed May 10, 2006. Except as required by applicable securities laws, Alliance Resource Partners, L.P. and Alliance Holdings GP, L.P. do not intend to update its forward-looking statements.

-END-

EX-99.2

Wachovia Securities

Nantucket Equity Conference

June 22, 2006

Exhibit 99.2

*

*

*

*

*

*

Forward-Looking Statements

This

presentation

contains

forward-looking

statements

and

information

that

are

based

on

the

beliefs

of

Alliance

Resource

Partners,

L.P.

and

Alliance

Holdings

GP,

L.P.

(the

“Partnerships”)

and

those

of

their

respective

general

partners

(the

“General

Partners”),

as

well

as

assumptions

made

by

and

information

currently

available

to

them.

When

used

in

this

presentation,

words

such

as

“anticipate,”

“project,”

“expect,”

“plan,”

“goal,”

“forecast,”

“intend,”

“could,”

“believe,”

“may,”

and

similar

expressions

and

statements

regarding

the

plans

and

objectives

of

the

Partnerships

for

future

operations,

are

intended

to

identify

forward-looking

statements.

Although

the

Partnerships

and

their

General

Partners

believe

that

such

expectations

reflected

in

such

forward-looking

statements

are

reasonable

at

the

time

such

statements

are

made,

neither

the

Partnerships 

nor

the

General

Partners

can

give

assurances

that

such

expectations

will

prove

to

be

correct.

Such

statements

are

subject

to

a

variety

of

risks,

uncertainties

and

assumptions.

If

one

or

more

of

these

risks

or

uncertainties

materialize,

or

if

underlying

assumptions

prove

incorrect,

actual

results

may

vary

materially

from

those

the

Partnerships

anticipated,

estimated,

projected

or

expected.

The

Partnerships

have

no

obligation

to

publicly

update

or

revise

any

forward-looking

statement,

whether

as

a

result

of

new

information,

future

events

or

otherwise.

Alliance  Overview

Ownership of Alliance Partnerships

(a)  Includes general partner interest held directly in ARLP’s Intermediate Partnership.

__________________

56.7%

L.P.

Interest

42.3% L.P.

Interest

1.98% General

Partner Interest

Alliance Holdings

GP , L.P.

(NASDAQ: AHGP)

59.9 million units outstanding

Alliance Resource

Partners, L.P.

(NASDAQ: ARLP)

36.4 million units outstanding

Public

Unitholders

Public

Unitholders

Management /

Others

1

(a)

IDRs

80.0%

L.P.

Interest

20.0%

L.P.

Interest

Ownership structure provides two ways to invest in Alliance Partnerships

Strong alignment of interests throughout the Alliance Partnerships

Management owns significant interests directly in AHGP and indirectly in ARLP

All unitholders benefit from increased distributions by ARLP

5

th

largest eastern coal producer

549 million tons of reserves at

1/1/06

642 million tons at 4/12/06

following River View

acquisition

5.9%

29.4%

$2,197 mm

$2,067 mm

2.17x

$1.84

$35.06

ARLP

$22.31

Unit Price (6/12/06):

$1,335 mm

Equity Market Cap:

Ownership Interests in ARLP

1.98% G.P. Interest

100% of Incentive Distribution Rights

15.6 mm ARLP common units

Asset Profile:

0.0%

Net Debt / Net Book Cap:

$1,335 mm

Enterprise Value:

$0.74

Distribution:

AHGP

NASDAQ Symbol:

0.0%

Net Debt / Ent. Value:

1.00x

Total Distribution Coverage:

Alliance Partnership Profiles

2

3

Increase cash distributions to unitholders by actively assisting

ARLP in implementing its business strategy

AHGP

intends

to

support

ARLP

by

assisting

with

the

identification,

evaluation

and

pursuit of growth opportunities

AHGP

may

provide

ARLP

access

to

AHGP’s

capital

resources

to

facilitate

such

growth opportunities, including:

Loans

Capital contributions

Guarantees

Complementary Business Objectives

Alliance Holdings GP, L.P.

Create sustainable, capital efficient growth in distributable cash flow

to maximize growth in distributions to ARLP unitholders

Alliance Resource Partners, L.P.

Strong operational and financial attributes of Alliance Resource

Partners, L.P.

Established history of operating and financial performance

Efficient, low-cost operator

Proven track record of executing growth strategy

Robust industry fundamentals

Meaningful upside through re-contracting exposure to market prices

Experienced management team

Visible inventory of growth prospects

Industry-leading distribution coverage at ARLP provides stability and a catalyst

for future growth

Accelerated cash flow growth potential of Alliance Holdings GP, L.P. through

ownership of ARLP incentive distribution rights

Strong economic alignment throughout organization

Management owns significant interests in both ARLP and AHGP

Alliance Investment Highlights

4

Alliance Resource Partners, L.P.

Overview

__________________

ARLP is a diversified producer and

marketer of coal to major U.S. utilities and

industrial users

Fifth largest eastern coal producer and

eleventh

largest

in

the

U.S.

(a)

Only publicly-traded master limited

partnership involved in the production and

marketing of coal

At 1/1/06, ARLP had approximately

549.0

million tons of proven and probable

coal reserves in the Illinois Basin, Central

Appalachia and Northern Appalachia

regions

On April 12, 2006, ARLP announced the

acquisition of River View, adding 99.3

million tons of reserves

(a)

Source: Platts coal data as of 9/30/05.

(b)

Includes value of ARLP general partner interest / IDR interest as of June 12, 2006. Net debt as of March 31, 2006.

Alliance Resource Partners, L.P. Snapshot

Unit Price at 6/12/06:

$35.06

Current Annualized Distribution:

$1.84

Current Yield:

5.25%

Equity Market Value

(b)

:

~$2,067 mm

Enterprise Value

(b)

:

~$2,197 mm

ARLP Trading Information

5

1

2

3

4

Pattiki Complex

River View Complex

Dotiki Complex

Mount Vernon

Transfer Terminal

5

6

7

8

Warrior Complex

Hopkins Complex

Gibson Complex

Pontiki Complex

9

10

11

12

MC Mining Complex

Tunnel Ridge Complex

Penn Ridge Complex

Mettiki Complex

Operations Summary

2005 Production

Northern

Appalachia

31%

Illinois Basin

61%

Central

Appalachia

8%

Reserves -

2005 YE

6

2005 Summary (MM Tons)

Production

Reserves

Primary Customers

Illinois Basin

Dotiki

4.7

89.5

Seminole; LG&E; TVA

Warrior

4.1

17.8

Synfuel Solutions

Pattiki

2.6

47.6

TVA; Tampa Electric

Hopkins

0.9

64.3

LG&E

Gibson (North)

3.4

35.1

PSI Energy

Gibson (South)

-

82.7

-

Region Total

15.7

337.0

Central Appalachia

Pontiki

1.7

18.4

ICG

MC Mining

1.6

22.8

Various

Region Total

3.3

41.2

Northern Appalachia

Mettiki / Mettiki WV

3.3

43.6

Virginia Electric Power

Tunnel Ridge

-

70.5

-

Penn Ridge

-

56.7

-

Region Total

3.3

170.8

Total Company

22.3

549.0

Including River View Reserves (4/12/06)

642.0

Northern

Appalachia

15%

Illinois Basin

70%

Central

Appalachia

15%

Efficient Operator

Source: Public filings

EBITDA

margin

represents

EBITDA

/

Total

Revenues.

EBITDA

is

a

non-GAAP

measure.

See

Slide

22

for

a

reconciliation

of

EBITDA

to

Net

Income.

ARLP is a low-cost, efficient coal operator, delivering sector-leading EBITDA

margins

__________________ 

7

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

Alliance

Foundation

Consol

Peabody

Massey

Arch

Alpha

2003

2004

2005

__________________ 

Note: EBITDA is a non-GAAP measure defined as income before net interest expense, income taxes and depreciation, depletion and amortization.  See Slide 22 for a reconciliation of EBITDA to GAAP.

(a)   Based on the midpoint of management guidance.

Consistent Track Record of Growth at ARLP

18.0

19.2

20.4

22.3

24.4

10.0

15.0

20.0

25.0

2002

2003

2004

2005

2006E

Production

$499.0

$523.2

$623.5

$799.6

$920.0

$0.0

$200.0

$400.0

$600.0

$800.0

$1,000.0

2002

2003

2004

2005

2006E

Revenue

$101.3

$110.3

$145.1

$193.6

$250.0

$0.0

$50.0

$100.0

$150.0

$200.0

$250.0

2002

2003

2004

2005

2006E

Cash Flow from Operations

$102.5

$119.0

$147.9

$230.1

$255.0

$0.0

$50.0

$100.0

$150.0

$200.0

$250.0

$300.0

2002

2003

2004

2005

2006E

EBITDA

CAGR: 7.9%

CAGR: 16.5%

CAGR: 25.6%

CAGR: 25.3%

(a)

(a)

(a)

8

(a)

$1.00

$1.00

$1.05

$1.05

$1.05

$1.05

$1.13

$1.25

$1.30

$1.30

$1.50

$1.50

$1.65

$1.65

$1.84

$1.84

$0.75

$0.95

$1.15

$1.35

$1.55

$1.75

$1.95

(a)

On

4/24/06,

ARLP

management

announced

a

quarterly

cash

distribution

to

$0.46

per

unit

for

the

first

quarter

ended

3/31/06

($1.84

per

unit,

annualized).

Continuous Unit Distribution Growth

__________________ 

ARLP has increased its quarterly distribution by 84% over the last four years

(a)

9

Leader in Distribution Growth

ARLP compares favorably to the broad MLP universe in terms of distribution

growth since the beginning of 2004

(a)

10

81%

64%

41%

40%

36%

36%

35%

34%

30%

26%

19%

19%

18%

16%

16%

13%

10%

5%

2%

0%

__________________ 

(a)   Total distribution growth from distribution paid in the first quarter of 2004 to the latest announced distribution.

Benefits of Industry-Leading Distribution Coverage

ARLP’s coverage ratio is among the highest of publicly traded limited

partnerships in the energy sector

(a)

Benefits to Alliance investors include:

Greater potential for future distribution growth

Capital efficient financing for ARLP organic growth projects

Added stability across operating and pricing environments

(a)

Source: public filings.  Coverage calculated as last twelve months (as of 12/31/05) total cash available for distribution divided by current annualized cash distributions.

(b)

Coal MLP Index includes NRP and PVR.  Coverage calculated as last twelve months (as of 12/31/05) total cash available for distribution divided by current annualized cash distributions.

(c)

Pipeline MLP Index includes APL, BPL, BWP, XTEX, DPM, EEP, EPD, ETP, HLND, HEP, KMP, MMP, MWE, MMLP, NBP, PPX, PAA, SXL, TCLP, TLP, TPP, WPZ and VLI. Coverage calculated as

last twelve months (as of 12/31/05) total cash available for distribution divided by current annualized cash distributions.

__________________ 

2.17x

1.33x

1.02x

ARLP

Coal MLP Index

Pipeline MLP Index

(b)

(c)

11

-50

0

50

100

150

200

250

300

350

400

1/1/2003

6/29/2003

12/26/2003

6/23/2004

12/19/2004

6/17/2005

12/14/2005

6/12/2006

Indexed Total

Return (%)   

ARLP

Coal MLP Index

Pipeline MLP Index

S&P 500

+253.1%

+202.5%

+85.8%

Total Returns Since 1/1/2003

+40.5%

Superior Total Returns to Unitholders

(a)

Coal MLP Index includes NRP and PVR.

(b)

Pipeline MLP Index includes APL, BPL, BWP, DPM, XTEX, EEP, EPD, ETP, HLND, HEP, KMP, MMP, MWE, MMLP, NBP, PPX, PAA, RGNC, SXL, TCLP, TLP, TPP, WPZ and VLI.

__________________ 

(a)

(b)

CAGR: 44.2%

12

Alliance Holdings GP, L.P.

Overview

13

Note:

This

graph

shows

the

impact

to

AHGP

as

a

result

of

ARLP

raising

its

quarterly

distribution

from

the

current

announced

distribution

of

$0.46

per

common

unit

($1.84

annualized).

This

information

is

presented

for

illustrative

purposes

only

and

is

not

intended

to

be

a

prediction

of

future

performance.

Assumes

constant

36.4

million

common

units

outstanding

at

ARLP.

__________________ 

Incentive distribution rights provide AHGP unitholders with significant

financial leverage to ARLP distribution growth

$0

$10,000

$20,000

$30,000

$40,000

$50,000

$60,000

$70,000

$80,000

$1.84

$1.94

$2.04

$2.14

$2.24

$2.34

$2.44

Hypothetical ARLP Annual Distribution per L.P. Unit

Hypothetical

Distributions to

AHGP

AHGP Leverage to ARLP Growth

G.P.

Interest

IDRs

L.P.

Interest

Current ARLP

Distribution

($45.8 million)

Note:

Assumes constant 36.4 million common units outstanding at ARLP.

__________________ 

Impact of ARLP Distribution Growth

14

AHGP Leverage to ARLP Distribution Growth

ARLP Distribution Growth

0%

10%

20%

30%

0%

5%

10%

15%

20%

9.5%

25.5%

17.9%

32.6%

Value Inherent in Underlying Cash Flows

ARLP’s value proposition becomes clear through its current cash available for

distribution

The impact is even more pronounced at AHGP due to the IDR leverage

Implied Distributions Across Coverage Levels

(a)

Implied Yields

(b)

Current ARLP

Distribution / Unit

(a)

Source:

public

filings.

Coverage

calculated

as

last

twelve

months

(as

of

3/31/06)

total

cash

available

for

distribution

divided

by

current

annualized

cash

distributions.

(b)

Yields as of June 12, 2006.

(c)

Coal MLPs Index includes NRP and PVR.

(d)

Pipeline MLPs includes APL, BPL, BWP, DPM, XTEX, EEP, EPD, ETP, HLND, HEP, KMP, MMP, MWE, MMLP, NBP, PPX, PAA, RGNC, SXL, TCLP, TLP, TPP, WPZ and VLI.

(e)

GP Holdcos

includes XTXI, EPE, ETE, MGG, NRGP.

__________________ 

(c)

(d)

15

(e)

$0.74

$0.82

$0.98

$1.18

$1.47

$1.90

$1.84

$1.94

$2.12

$2.36

$2.69

$3.19

$0.50

$1.00

$1.50

$2.00

$2.50

$3.00

$3.50

2.17x

2.00x

1.75x

1.50x

1.25x

1.00x

ARLP Coverage Ratio      

Implied ARLP Distribution

Implied AHGP Distribution

9.11%

7.90%

8.53%

4.68%

3.57%

3.32%

7.03%

5.86%

5.25%

7.50%

0.00%

2.00%

4.00%

6.00%

8.00%

10.00%

ARLP

Coal MLPs

Pipeline

MLPs

AHGP

GP

Holdcos

Distributed Yield

Assuming 1.00x Coverage at MLP

Positioned for Continued Growth

Growing Domestic Demand for Coal

Continued U.S. economic strength

Electric power demand near all-time high and

expected to grow ~2.0% annually through 2030

(a)

Energy Policy Act of 2005 favors coal as fuel of the

future

New coal-fired power plants total ~174 GW by 2030

(a)

Btu

conversion

–

coal

to

liquids,

coal

gasification

Domestic Coal Supply Constraints

Significant barriers to entry (permitting, regulatory

compliance, etc.)

Higher capital costs and extended mining equipment

backlog

Skilled labor shortages

Ongoing transportation infrastructure issues

Low Coal Stockpiles

Inventory levels at 4Q’05 15.4% below five-year

average

(a)

Favorable Global Dynamics

Continued global expansion (China, India, U.S.)

Challenges for Competing Fuels

Nuclear utilization at full capacity

Non-competitive oil and natural gas prices

Continued challenges for LNG

Robust Coal Sector Industry Fundamentals

127

118

126

112

113

112

123

106

109

90

100

110

120

130

140

4Q

2003

1Q

2004

2Q

2004

3Q

2004

4Q

2004

1Q

2005

2Q

2005

3Q

2005

4Q

2005

U.S. Coal Inventories

(a)

__________________ 

(a)

Source: Energy Information Administration.

0

15

30

45

60

1980

1990

2000

2010

2020

2030

Historical and Projected Energy Consumption by

Source

(a)

Petroleum

Coal

Gas

Nuclear

Renewable

Hydropower

16

ARLP Positioned to Benefit from Sector Growth

Future revenue growth potential enhanced by meaningful exposure to market

pricing

$25.77

$28.79

$33.65

$36.01

$38.53

$0.00

$10.00

$20.00

$30.00

$40.00

2003

2004

2005

2006E

2007E

Coal Sales / Ton Sold

CAGR: 10.6%

Coal Sales Volumes Open to

Market Pricing

(a)

Tons of

Year

Coal (mm)

2006

1.4

2007

10.6

2008

16.7

17

(a)

Based on ARLP press releases dated 1/30/2006 and 4/24/2006.

__________________ 

(a)

(a)

Significant Scrubber Market Dynamics

Scrubber Additions -

Announced

Planned

Current and pending

legislation has caused

utilities to add or announce

plans to add scrubbers

which management expects

should lead to additional

market opportunities for

the Illinois Basin and

Northern Appalachian

regions

As utilities execute their

environmental compliance

initiatives, a significant

amount of coal demand

historically supplied from

the Central Appalachian

region should switch to

higher sulfur Illinois Basin

and Northern Appalachian

coal

18

Source:  Company analysis.

__________________ 

ARLP Well Positioned in Scrubber Markets

Current Position

Four mining complexes

currently producing in the

Illinois Basin and one in

Northern Appalachia serving

the scrubbed utility markets

#2 overall producer in the

Illinois Basin

Growing presence with

announced projects in

Northern Appalachia

In 2005, 70% of the 22.3

million tons produced

serviced the high or medium

sulfur markets

Approximately 540 million

tons of “scrubber”

quality

coal reserves (high and

medium sulfur)

Recent Contract Agreements

Allegheny Coal Sales Agreement

•

New 10 year, 20 million ton

coal supply agreement

commencing with initial

production from Penn Ridge

mine

LG&E Coal Sales Agreement

•

New 6 year, 23.5 million ton

coal supply agreement

commencing January 1, 2006

with option to extend

VEPCO Coal Sales Agreement

•

New 7 year, 15.8 million ton

coal supply agreement

commencing January 1, 2007

Current Mine Developments

Elk Creek

Mountain View

Van Lear

New Mine Developments

Tunnel Ridge (Permitting in

Progress)

Penn Ridge (Initiating

Permitting Process)

Gibson South (Permitting in

Progress)

River View (Initiating

Permitting Process)

19

20

Large Inventory of Organic Growth Projects

ARLP has a number of significant, near-term development opportunities

Tunnel

Penn

Gibson

Development Project:

Ridge

Ridge

South

Status:

Permitting in

progress

Initiating

permitting process

Permitting in

progress

Expected Development

Cost:

$200 million

$165 million

$100 million

Anticipated Initial

Production:

2008 -

2009

2009 -

2010

2008 -

2009

Estimated Reserves

(million tons)

:

70

55

83

Coal Quality:

High Sulfur

High Sulfur

Medium Sulfur

Estimated Annual

Production Capacity

(million tons):

6.0

5.0

3.1

River

View

$110 -

$130 million

99

High Sulfur

3.5

2008 -

2009

Initiating

permitting process

Summary

Strong operational and financial attributes of Alliance Resource

Partners, L.P.

Established history of operating and financial performance

Efficient, low-cost operator

Proven track record of executing growth strategy

Robust industry fundamentals

Meaningful upside through re-contracting exposure to market prices

Experienced management team

Visible inventory of growth prospects

Industry-leading distribution coverage at ARLP provides stability and a catalyst

for future growth

Accelerated cash flow growth potential of Alliance Holdings GP, L.P. through

ownership of ARLP incentive distribution rights

Strong economic alignment throughout organization

Management owns significant interests in both ARLP and AHGP

Alliance Investment Highlights

21

Questions and

Answers

ARLP EBITDA Reconciliation

EBITDA

is

defined

as

income

before

net

interest

expense,

income

taxes

and

depreciation,

depletion

and

amortization. 

Management

believes

EBITDA

is

a

useful

indicator

of

its

ability

to

meet

debt

service

and

capital

expenditure

requirements

and

uses

EBITDA

as

a

measure

of

operating

performance.

EBITDA

should

not

be

considered

as

an

alternative

to

net

income,

income

from

operations,

cash

flows

from

operating

activities

or

any

other

measure

of

financial

performance

presented

in

accordance

with

generally

accepted

accounting

principles.

EBITDA

is

not

intended

to

represent

cash

flow

and

does

not

represent

the

measure

of

cash

available

for

distribution.

The

Partnership's

method

of

computing

EBITDA

may

not

be

the

same

method

used

to

compute

similar

measures

reported

by

other

companies,

or

EBITDA

may

be

computed

differently

by

the

Partnership

in

different

contexts

(i.e.

public

reporting

versus

computation

under

financing

agreements).

22

($ in thousands)

Year Ended December 31,

2006E

2002

2003

2004

2005

Midpoint

Cash flows provided by operating activities

101,306

$

110,312

$

145,055

$

193,618

$

250,000

$

Reclamation and mine closing

(1,365)

(1,341)

(1,622)

(1,918)

(1,800)

Coal inventory adjustment to market                            

(48)

(687)

(488)

(573)

-

Other

1,014

353

(255)

(2,057)

(1,000)

Net effect of changes in operating assets and liabilities

(13,714)

(8,240)

(12,405)

26,577

(5,700)

Interest expense

16,360

15,981

14,963

11,816

10,700

Income taxes

(1,094)

2,577

2,641

2,682

2,800

EBITDA

102,459

$

118,955

$

147,889

$

230,145

$

255,000

$

Depreciation, depletion and amortization

(52,408)

(52,495)

(53,664)

(55,637)

(71,500)

Interest expense

(16,360)

(15,981)

(14,963)

(11,816)

(10,700)

Income taxes

1,094

(2,577)

(2,641)

(2,682)

(2,800)

Net income

34,785

$   

47,902

$   

76,621

$   

160,010

$

170,000

$

Wachovia Securities

Nantucket Equity Conference

June 22, 2006

*

*

*

*

*

*