Note 10 - Commitments and Contingencies

12 Months Ended

Dec. 31, 2017

Notes to Financial Statements

Commitments and Contingencies Disclosure [Text Block]

NOTE

10

—COMMITMENTS AND CONTINGENCIES

Leases

The Company leases coal reserves under agreements that require royalties to be paid as the coal is mined and sold. Many of these agreements require minimum annual royalties to be paid regardless of the amount of coal mined and sold. Total royalty expense was

 

$1.8

million, 

$127

thousand and 

$81

thousand for the years ended 

December 

31,

2017,

 

2016

 and 

2015,

respectively. These agreements generally have terms running through exhaustion of all the mineable and merchantable coal covered by the respective lease. Royalties or throughput payments are based on a percentage of the gross selling price received for the coal mined by the Company. Payments of minimum coal royalties and throughput payments for leases with Ramaco Coal, LLC commenced in

2017

pursuant to the terms of the agreements.

The Company

also leases facilities under various noncancelable lease agreements. Rent expense for facilities totaled

$363

thousand,

$381

thousand and

$71

thousand in

2017,

2016

and

2015,

respectively.

Future minimum lease and royalty payments as of

 

December 

31,

2017

 are as follows:

			Coal Lease
			and
	Operating		Royalty
Year Ending December 31,	Leases		Obligations
2018	$	158,618	$	2,016,378
2019		117,148		3,656,564
2020		74,623		3,155,064
2021		60,448		3,115,064
2022		15,112		3,012,064
Thereafter		—		21,145,220
Total minimum payments	$	425,949	$	36,100,354

Environmental Liabilities

Environmental liabilities are recognized when the expenditures are considered probable and can be reasonably estimated. Measurement of liabilities is based on currently enacted laws and regulations, existing technology and undiscounted site-specific costs. Generally, such recognition would coincide with a commitment to a formal plan of action.

No

amounts have been recognized for environmental liabilities.

Surety Bond

In accordance with state laws, the Company is required to post reclamation bonds to assure that reclamation work is completed. Reclamation bonds outstanding at

December 31, 2017

totaled approximately

$12.5

million. 

Purchase Commitments

We secured the ability to transport coal through rail contracts and export terminals that are sometimes funded through take-or-pay arrangements. As of

 

December 

31,

2017,

commitments under take-or-pay arrangements totaled 

$987

thousand, all of which is obligated within the next year.

Litigation

From time to time, the Company is subject to various litigation and other claims in the normal course of business.

No

amounts have been accrued in the consolidated financial statements with respect to any matters.