Note 8 - Leases

12 Months Ended

Dec. 31, 2022

Notes To Financial Statements

LEASES

NOTE 8—LEASES

The Company has various finance leases for mining equipment, which are generally for terms up to 36 months and expire through 2025. In addition, we have one operating lease for office space with a term of approximately five years that runs through 2027.

Amortization of right of use assets associated with finance leases was $4.8 million, $1.1 million, and $0.0 million in 2022, 2021, and 2020, respectively, as discussed in Note 3. Interest expense recognized for financing lease liabilities was $0.4 million, $0.1 million, and $0.0 million in 2022, 2021, and 2020, respectively. Operating lease expense was $0.2 million in 2022 and $0.1 million per year in 2021 and 2020.

Right-of-use assets and lease liabilities are determined as the present value of the lease payments, discounted using either the implicit interest rate in the lease or our estimated incremental borrowing rate based on similar terms, payments and the economic environment where the leased asset is located. Below is a summary of our leases:

(In thousands)	Classification	December 31, 2022		December 31, 2021
Right-of-use assets
Financing	Financing lease right-of-use assets, net	$	12,905	$	9,128
Operating	Other assets		694		25
Total right-of-use assets		$	13,599	$	9,153
Current lease liabilities
Financing	Current portion of financing lease obligations	$	5,969	$	3,461
Operating	Accrued expenses		122		25
Non-current lease liabilities
Financing	Long-term portion of financing lease obligations	$	4,917	$	4,599
Operating	Other long-term liabilities		585		—
Total lease liabilities		$	11,593	$	8,085

Minimum lease payments for our lease obligations are as follows:

	December 31, 2022
(In thousands)	Financing		Operating		Total
Future minimum lease payments:
2023	$	6,302	$	161	$	6,463
2024		4,005		161		4,166
2025		1,032		164		1,196
2026		—		168		168
2027		—		168		168
Total undiscounted lease payments		11,339		822		12,161
Less: Amounts representing interest		(453)		(115)		(568)
Present value of lease obligations	$	10,886	$	707	$	11,593
Weighted average remaining term (years)		2.0		5.0
Weighted average discount rate		4.2%		6.0%

Coal Leases and Associated Royalty Commitments—Leases of mineral reserves and related land leases are exempt from the lease accounting requirements addressed above. Refer to Note 10 for information regarding coal leases and associated royalty commitments.