Q3 2025 Core Natural Resources Inc Earnings Call

Good morning, ladies and gentlemen, and welcome to the core natural resources Inc, third quarter earnings call at this time, all lines are in a listen-only mode. Following the presentation, we will conduct a question and answer session. If at any time during this, call, you require immediate assistance, please press star zero for the operator.

This call is being recorded on Thursday November 6th 2025. I would now like to turn the conference over to dexlan senior vice president of strategy. Please go ahead. Good morning, from Canonsburg, Pennsylvania, everyone and thanks for joining us today. Before we begin. Let me remind you that certain statements made during this call, including statements relating to our expected, future business, and financial performance. May be considered forward-looking statements according to the private Securities, litigation Reform Act.

Forward-looking statements, by their nature, address matters that are to different degrees uncertain.

These uncertainties which are described in more detail in the annual and quarterly reports that we file with the SEC may cause our actual future results to be materially different than those expressed in our forward-looking statements. We do not undertake to update our forward-looking statements whether as a result of new information, future events or otherwise, except as may be required by law.

I'd also like to remind you that you can find a Reconciliation of the non-gaap financial measures that we plan to discuss this morning, at the end of our press release, a copy of, which we have posted in the investor section of our website at core natural resources.com.

Chairman and CEO Miteshkumar Thakkar, our President and CFO Deck Slone, and Bob Braith, our Senior Vice President of Marketing and Sales.

After some formal remarks from Jimmy and mesh, we will be happy to take questions with that. I'll now turn the call over to Jimmy Jimmy.

Thank you, dick, and good morning everyone.

I am pleased to report that core natural resources had a solid performance in the third quarter despite some operational headwinds.

during Q3 2025, we once again, generated free cash flow despite weak, commodity prices deployed cash toward our share buyback program secured, 26 million, tons of future business, and nearly finalized plans with impa to recover and reposition the Long Haul equipment at the Litter South, mine

Furthermore, we received the first tranche of Insurance Recovery for the lar. South Fire mitigation X efforts.

I am also excited to announce that we have verified the presence of noteworthy levels of rare Earth elements and critical minerals at our Flagship operations in both the eastern and western United States.

Now, let me dive a little deeper into our operational results.

Coal production within the high CV, thermal segment came in at 7.6 million tons in Q3 25 compared to 8 million tons in the prior quarter.

During the quarter, our icv thermal segment reported realized coal revenue of 59.78 cents per ton and cash cost of $40.53 per ton.

Segment cash costs were slightly elevated compared to Q2 25. Due in part to operational challenges, we faced at the West Elk, Mine as it transitioned to a new scene within the reserves.

We believe these initial challenges will continue partly through Q4 255.

However, the BC at the West Elk, Mine will allow us to take advantage of a much thicker, coal seam and better quality characteristics which will ultimately drive more favorable, productivity realizations, and cash costs.

during the quarter, the Pennsylvania, mining complex outperformed versus expectations, which partially offset the challenges at West theft,

Moving forward to Q4, we expect 1 to 2 long wall moves at the Pennsylvania. Mining complex depending on its level of outperformance relative to our guidance level for the rest of the year.

Let's move on to the metallurgical segment.

Coal production within the segment came in at 2.3 million tons in Q3 25 compared to 2.4 million tons in Q2 25.

During the quarter, our metallurgical segment reported realized coke and coal. Revenue of 112.94 per ton and 101.60 cents per ton, across the segments, as a whole when factoring in the 372,000 tons of thermal byproduct cells.

Cast costs for the quarter came in at $94.18 per ton.

Additionally, the metallurgical segment, incurred 18 million dollars of cost associated with the Lear South Fire and Idol related expenses, offset by 19 million dollars of Advance payments. On the Lear South insurance claim

Although the cash margins are depressed compared to recent years, I am very proud of the core teams ability to manage and continually work toward reducing costs through this market downturn and to continue to realize positive cash operating margins.

Now, let me provide a brief update on the lyric South mine.

after we temporarily resell the mine in July,

We have further Advanced, our continuous mining sections.

At the same time, we have continued to work with the federal and state agencies for re-entry. Plans that will involve recovering repositioning and restarting the long wall system.

As we approached our entry date in October, the government shutdown, resulted in the unavailability of MSA Personnel needed for the re-entry efforts, and we have been in a holding pattern ever since

Our operating team remains confident that the long wall equipment is largely unaffected and that the mind is ready for re-entry, into the long wall section. As soon as the M shell Personnel, are available to participate in the process.

Now, to the Powder River Basin segment.

Q2 25.

During the quarter, our prb segment reported realized coal revenue of 14.9 cents per ton and cash cost of 13.4 cents per ton.

Both were lower compared to the prior quarter, mostly due to the federal royalty rate reduction in conjunction with provisions in many of the cores. Existing contracts require that cost savings associated with certain policy-related changes be passed along to the customer.

From a Consolidated perspective, despite operational headwinds uncertainty surrounding the timing of re-entry at Lear South and weak Benchmark prices. We still return more than 60% of our Q3 2525. Free cash flow to shareholders.

We deployed 19 million dollars towards share repurchases and an additional 5 million dollars to dividends.

In addition, we announced this morning that the board of directors have declared a 10-cent per share dividend payable on December 15th, to stockholders of record, on November 28th.

From a year to date perspective, we have returned, 218 million to our shareholders, or approximately, 100% of our free cash flow generation through our robust Capital return program.

As stated in Prior quarters core will continue to follow. A measured approach to shareholder returns by targeting around 75% of our free cash flow to be utilized, primarily for share BuyBacks, as well as a small sustaining dividend.

Leaving the potential to flex that percentage up depending upon market conditions.

With that.

Let me now turn to the topic that could provide potential future optionality for core Rare Earth elements and critical minerals.

Over the last several months, we have completed expiration and sampling at. Our prb minds and Eastern operations to analyze the concentrations of critical minerals within our Reserves.

We are intrigued by our findings across both our prb minds and Eastern operations.

The result in the prb demonstrated elevated, Ash bases, concentration of certain Rare Earth elements and critical minerals particularly at the top and bottom of the coal scene.

In the East while measured as bases concentration, where somewhat less elevated than in the prv operations, the very large flow rates at the PMC, Lear and Lear South operations could offer. Unique opportunities for further upgrading

As a result of these findings, we are engaging with several subject matter, experts to explore feasibility, and advance of potentially launching an RFP process.

Now, let me touch on some of the early operational successes. We've had in integrating, our 2, Legacy companies and creating a stronger core natural resources.

We've executed several best practices across the operations.

Such as implementing more standardized production, schedules to optimize our runtime and labor expense.

Sharing equipment and resources for special projects, such as long moves.

And leveraging our scale with suppliers to secure discounts on equipment and services.

We continue to leverage our strong logistical Network, and diverse quality characteristics, to create value, uplift opportunities, for our products, through product blending,

These are just a few examples of the merger related synergies, that positively impact our bottom line, and while we are confident in our ability to create value across the market cycle, and to capitalize in a very substantial way. When the market turns,

Our focus for the fourth quarter is to execute operationally.

We are prepared and ready to breach. The seals at Lear South as soon as Mia Personnel are available.

We have a solid plan in place and expect to have the wall up and running before you're in.

However, certain aspects of the timing are out of our control.

We remain in close contact with state and federal agencies.

At West Elk.

We continue to work through the transitions to the BC and are optimistic about the operational benefits that we will realize from this thicker cosine.

We expect these efforts during the fourth quarter will set us up for a performance step change in 2026.

Due to our low-cost asset base Advanced Logistics Network and diverse product quality, we are uniquely positioned to generate strong cash flow, and shareholder value in all parts of the commodity cycle.

Provide the marketing and financial updates.

Thank you, Jimmy, and good morning, everyone.

Let me start by providing an update on our financial results for the quarter.

This morning, we reported a strong third quarter, 2025 financial performance, despite operational challenges at 2 Minds within our footprint.

We achieved net income of 32 million or 61 cents per diluted share and adjusted Aida of 141 million.

The reported adjusted EPA includes 19 million of in Insurance Recovery. Advancements for Lear south, offsetting 18 million in Lear South Fire and idle costs that were incurred in the quarter.

Furthermore, we generated 88 million of operating cash flow and spent 49 million in capital expenditures to generate 39 million of free cash flow.

Our operating cash flow was impacted by negative working capital changes of 52 million mostly related to increases in our accounts, receivable, and coal inventory, balances versus the prior quarter.

However, both of these are timing related.

At the end of the third quarter, we are total liquidity of 995 million and increase of 47 million compared to the end of the second quarter.

This increase was driven by a higher cash, balance plus the increased availability on our combined securitization facility.

As a reminder we completed a successful refinancing transaction. During the third quarter whereby, we combine the Legacy are securitization programs into 1 facility.

This combination provides greater availability on the facility due to a broader and more diverse customer base which in turn, improves the risk profile of our overall receivables.

We'd like to thank our banking partners for the continued and expanding support.

Let me update you on the marketing front.

In the domestic Market we recent policy shifts under the Trump Administration have created more support for domestic. Call by lowering production and royalty related. Costs providing a more stable regulatory environment and allocating funds to extend the life of coal fired power plants.

Effectively, keeping coal plants operating and reinforcing the central role of coal in the US, Energy Mix.

Through September us. Power demand has remained robust with cold fire, generation increasing by approximately 12% year to date.

However, some of the specific markets we serve are up even more.

For example, the pjm RTO is up approximately 16% on a year-to-date basis.

Not only has energy demand continued to increase this year, but it is expected to increase for years to come.

Data Center built out, has been a large part of this increased power demand and by the end of 2025, the data centers in the US will require 22% more grid power than last year.

Furthermore, it is estimated that us data centers will consume nearly 3 times as much power by 2030 than they do today.

as such us data center demand is expected to rise to almost 76, gigawatt in 2026 108, gigawatts in 2028 and 134 gigawatts and 2030

This data center demand, boom has caused many, Electric utilities to look at their long-term load capacities, which is driven a significant shift in how they think about Contracting Future Energy Supply.

We have seen a noticeable shift to Long longer-term, deals for our thermal products and our low-cost operations allow us to proactively layer in term business cost. Competitively

on the international thermal front.

A prolonged monsoon season and weakness in the Indian rupee have dampened near-term demand. However, longer-term fundamentals, remain unchanged.

Cement demand in, India is expected to grow approximately 50% by 2030 versus 2024 levels. And our high CV thermal product, coupled with our strategic logistical network via the ownership of our Baltimore terminal is well positioned to take advantage.

in addition in late September, India removed, the special compensation test tax, which will support demand growth

Looking ahead internationally for cooking coal, Global steel prices continue to face pressure. Due primarily in our view to macro conditions,

However, we remain highly constructive on the longer term fundamentals. Given the buildout of blast furnaces across Southeast Asia.

Projected increases in steel demand and infrastructure build out.

At the same time, momentum behind Europe's green steel transition is slowing.

As governments, faced significant cost barriers, particularly related to hydrogen Supply and energy infrastructure.

On the supply side.

We continue to believe that years of underinvestment as well as degradation and depletion of the global Reserve Base will act to constrain Global methodological Supply.

While exerting a foot pressure on prices.

This Market landscape leads the backdrop for our Contracting progress.

Due to the desirability of our products, our marketing team was able to expand our contract book for 2026.

On the thermal side, we increased our high CV book by approximately 4 million, tons to a sold position of nearly 17 million tons in total.

For the powder of our Basin. We increased our sold possession by 8 million tons, raising our 2026 contracted book to more than 40 million tons.

Due to the nature of the methodological segment. Long-term Contracting is less prominent and pricing in the international arena is generally index linked.

However, our current methodological segment has nearly 3 million, tons contracted for 2026.

With approximately 500,000 of those tons slated for delivery to North American customers.

Furthermore, we remain in negotiations with additional North American, customers for potential contract volumes, and the expected provide more color on our next earnings call regarding pricing.

Now, let me provide a quick update on our outlook for the remainder of 2025.

For the high CV thermal segment. We are maintaining our guidance for sales volumes while reducing our price range to 60 to 61 per ton.

Additionally, we are raising our cash cost guidance by $1, to arrange dollars to $1 per ton.

This increase is primarily a result of the West Elk operational challenges that Jimmy mentioned earlier.

On the methodological front, due to the timing of the lears out, longwall restart.

We are lowering our coal and cold sales volume guidance to a range of 7.4 to 7.8 million tons.

On the cash cost side. We anticipate a similar cost structure in the fourth quarter.

As incurred in the third quarter.

Therefore, we are decreasing our cash cost guidance for the segment to a range of 93 to 97 per ton.

We also anticipate spending 15 to 25 million in idle and fire mitigation costs. During the fourth quarter, as we work to restart the year's out, long wall,

For the prb segment.

We are again, increasing our sales volume guidance to a range of 47 to 49 million tons and our committed and priced position.

Has increased.

To 48 million tons at a realized School revenue of approximately 14 dollars and 46 cents per ton.

We are maintaining our cash cost per turn guidance range.

On the capital expenditures front. We took advantage of attractive equipment financing throughout the year and are lowering our capital expenditure guidance by $40 million to arrange of 260 to 290 million.

Now, let me pass it back to Jimmy for some quick closing remarks before we open the call for Q&A.

Thank you, m. In closing for the reminder of 2025, we will be focused on a few key areas that we believe will set us up for Success moving forward.

The PMC Lear prb and continuous minor operations ran very the third quarter.

Third, we will continue to focus on managing our spending levels to maximize our cash margins throughout the cycle. Despite the weaker Benchmark prices. We are experiencing today.

Forth. We are prioritizing filling out our sales book in 2026 and Beyond.

We have a layered in nearly 26 million, tons of forward contracts which provides significant Revenue visibility as we move into 2026.

Finally, let me finish by recognizing our employees.

Together to ensure we develop core natural resources into the premier Coal Company. We envisioned it to be.

Despite the government shutdown, the team has continued to focus on the controllables and stands ready to execute our long wall recovery plan.

The core team is adapt at navigating. The cyclical nature of the coal markets,

And we have successfully managed our cost, while focusing on our core values of safety and compliance, continuous Improvement and financial performance.

With that, I will hand the call back over to the operator to begin the Q&A portion of our call.

Operator. Can you please provide the instructions to our callers?

Thank you, ladies and gentlemen, we will now begin the question and answer session. Should you have a question, please? Press the star button, followed by the number 1 on your touchtone phone, you will hear a prompt that your hand has been raised. Should you wish to decline from the polling process? Please press the star button, followed by the number 2. If you are using a speaker-phone, please lift the hands up before pressing any Keys 1 moment, please for your first question.

First question is from Nathan Martin from bench, part Benchmark Company. Please go ahead, Nathan

Thanks operator, good morning everyone. Um, maybe just start uh on West Elk. Obviously, you guys had that move to be seen um you know just looking for a little more color there, some reports out you know that there may have been some elevated methane levels. Um, you should there be any ongoing calls for production impacts from that? Then how should we think about costs and production from that mine heading into 2026 at a at a full run rate?

And at, uh, yeah, that's a good question. So West Elk, you know, as we said earlier, we did have some methane issues there. You know, it was not any safety concern; we just had to keep it that way for our employees. So we, uh, the team went out, you know, managed some ventilation. We made a few, uh, control changes there. And we believe that we have the methane situation put behind us. We haven't had any elevated methane readings since we did that. And then fast forward, after we were running, we ran up against what we were calling our safe zone or stop margin, to where we had to dewater the...

So that was Overland the same. We were mining. The team got started on that as quickly as they could, and that's what slowed us down here. The second part, the good news is, I Believe, by early next week. We will have West Elk back up and running and I look forward to what we can get done there. I think it will be a low cost as we talked before I really like the quality of the coal and excited about what we can do with that in the marketplace. So in short, very excited about the future West Elk, and I think we'll have most of those problems behind us for the remainder of the year. Of course, mining is mining. You know, some little things could come up, but those things that stopped us from mining. I think we have those under control now

Appreciate those thoughts, Jimmy. Um, maybe one for Bob on the marketing side. Bob, can we get a breakdown of the now? Looks like 17 million tons of committed and price tag TV for 2026. And then any commentary on the pricing of those tons as well as the 40 million tons of PRB that you guys called out?

And ain't no problem. You know, one thing I will say is I certainly am pleased with the team and their efforts in the last quarter, as I mentioned in my prepared remarks.

You know, we had 26 million, tons of new sales. Um, and what I like about that too is, you know, we're looking at sales on the high CV, segment alone going all the way out through 2030. So that certainly providing us a lot of good visibility as we move forward. And the other thing it's very encouraging is these utilities are Contracting out, you know, longer term duration. So I think that they are seeing the benefits of the data center demand coming online and uh, and they're Contracting forward, but for 2026 alone of the 17 million, tons of high CV, uh, 14 million, 14, million of that is PMC, about 10 million domestic, 4 million, export, uh, majority of that export is indexed linked. So again, we have some upside there. Um, if API, 2, prices continue to rise as we've seen in the coming or in the uh recent weeks and about 3 million. Tons of that is is West Elk um you know, from a pricing standpoint, we're looking at upper 50s right now. Bases of 105 api2 price. So if we see that rise in Cal 26, that certain is going to afford US the ability to

To, uh, to increase that price. And then on the prb side, uh, as we mentioned, approximately 41 million tons. And, uh, we're seeing pricing in the low to mid 14s on that.

Fixed price, domestic. Coal for 26. Any comments around the pricing there, um, would be helpful as well.

We're seeing there, a lot of that is, is high volt cold that we've put to bed domestically. Um, but again, we'll give a better update to clear update on the next call. But I would anticipate that number increasing, as uh, when we when we do report next,

Okay, great. Um, and then maybe just one final question for you. Pass it on, uh, you know, first tranche of insurance proceeds received. Um, how should we kind of think about the potential range from that insurance and business interruption recoveries from Lear South Met Test? I think you mentioned previously maybe around $100 million, but would just be great to get an update there. Thank you.

So um I think um um Nate um if you look at year to date, we have spent about 75 million dollars on fire and idling cost. Um, and we are guiding to another uh, let's call it 15 to 25 million for the fourth quarter. So, if you add that up, I think um, just from firing at idling cost we are we're approaching 100 million dollars and then um on top of it you have to apply the residual business Interruption um claim as well. So I think we are we are definitely in 3 digits here. So I think um we'll continue to track that and and as we submit the claims we'll keep you apprised. I think, um, we are not waiting for

The full claim to play out. We are starting to, um, put Advanced claims in, as we incur cost, um, as a starting point. Um, I think, um, our next step is to go ahead with the business Interruption claim, uh, as well and, uh, you'll going to start trickling that in as well. So, we are very optimistic of where we will end up with the overall insurance claim.

Appreciate that. Update mesh. I'll uh, I'll pass it on for now. Best of luck in the fourth quarter.

Thank you. Thanks Nate.

Next question comes from Nick Giles of B Riley Securities. Go ahead.

Thank you, operator. Good morning, everyone just wanted to follow up on the high CV cost side and and really gauge your uh, level of confidence in your PMC. Longwa operations maintaining their low costs. And if there's any room for improvement, I think I, you know, if, if westo costs were to improve around ten dollars a tonne, I would back into a benefit of around $2, which would keep the segment cost. Maybe slightly more elevated than than recent years. So, just appreciate, any any color there.

When when you look at Cost, it's something as you, well, know that we work on continuously all the time. But 1 thing that got the high CV segment, a little bit of that line was the unfortunate production. Shortfall we had from the West Elkmont which obviously would be a little higher cost. I think you're in the ballpark, with the numbers. I mean, I like to see the Pennsylvania mining complex, you know, running cash costs.

Before we ran in the past somewhere around 37 to 39 bucks. You know, we think we can stay there. And then when I look at, uh, the West Elk, you know, we got to see what that mine does. When we're running it very consistently, pull out all the time, with no delays, but I do really believe that I can get it somewhere down and, you know, somewhere, we should be low 30s, somewhere in there for cost for West out. So obviously, that will help the overall cost structure of our

on the high CB side.

Hey, Nick and it's Dax. Listen, another point. I think that's interesting is, you know, as Bob discussed for the 17th of icv thermal, we've committed maybe a small step down in terms of average price, um, at this point, uh, when we look at 2025 versus 2026 but the cost reduction, you know, should be with West Elk. Now, being sort of, you know, pulling average cost down as opposed to being sort of, you know, a a force to pull those costs up, you know, sustaining that margin maybe even improving upon that margin in 2026 is probably entirely realistic and what we're targeting. So, you know, that contribution from The High TV thermal segment, you know, could at a minimum stay sideways even with a little bit of a demolition on the price, um, and perhaps could expand a bit.

Because I appreciate that. I wanted to ask a similar question on the meaty side. Um, you know, as we look to 2026 when Lear South is back up and running, um, you know, how should we think of costs that that mine specifically, and how does that translate to the entire segment?

So we have to wait and see on that. I really want to get that mind back up and running. You know we got to recover the Shields, get the face set up the team there has done an outstanding job and hasn't been in, you know, the best possible environment there where they couldn't run the long wall, but they have advanced our mining sections, and they've got the new face set up and ready. So, I'm really excited what their South can bring to the table in 2026. Yeah and and um, nick, uh, if you think about the broader methodological core portfolio, we're going to have more tons coming out of uh long wall Minds compared to CM Minds. So there's going to be some tail Tailwind tied to that as well.

Great uh 1 last 1 on that. If I could, you know, do we have any clarification on the total number of uh met tonnage, that will be subject to the 45x credits and 26?

You know, that is very clearly you know, a capabilities test. Um when you look at sort of how the legislation is written. So certainly all of our metallurgical Co and metallurgical segment. Um, should qualify, but when you also consider the tons being produced at pamc, you know what, we're sending into the metallurgical market and selling to Steel, producers is really a standard blend. So, uh, across that full 26 million tons, um, you know, all of those times are suitable for use in the production of Steel. So, we certainly believe that, um, those tons should qualify

Uh, again, it it's, uh, it's, it's, it's fairly clear that this is about capability, not end Market. Um, we would say this, if, if, uh, the cooking call Market were large enough, we could sell all 26 million tons of pamc, and into that market. So, um, that's our belief that we would get, we would qualify on that front. Um, so we can talk further about it offline, but, uh, just an initial reaction,

No deck. That's really encouraging. Um, guys, I appreciate all the color. Oh, really nice update. Keep up the good work.

Some George Edie out of UBS. Go ahead.

Yeah. Good day, Jimmy, M, Bob and deck cross. You just asked about the rarest, so just sort of for cool. Specifically, and financially speaking, do you think it's more prospective in the prb or east coast and maybe also remind us? What are the latest on discussions with the government? Jimmy spoke about before, subject matter experts. Um, but other government getting involved to potentially to and underwriting financing and or prices.

All right. Well we've been dealing with really evaluating the potential to recover Rare Earth elements and critical minerals from our eastern and western mining operations as we said in the script you know that works on going but it's still in the early stages. But I will say the question is not whether Rare Earth elements and critical minerals exist at these operations. Its

Rather the question is, can we cost effectively segregate upgrade and extract the feed stock that we have available? I mean our Studies have shown that we have them in the we have them in the co seams,

Out out at our Western operations and it's very similar to what others have said out there. So we do have them 1 of the key advantages that we bring to. The table is the massive scale of our already permitted. Active operations that we have, we run the largest underground, mining complex in the US at PMC and the second largest operations in the prb.

So these operations, you know, generate huge quantities of material every day and the angle. We're evaluating is whether we can leverage our scale and creating a business case for The Rare Earth elements and critical minerals.

The work is being led by our Innovation Group, which has a team of Highly competent, scientists, and engineers and work a lot of strong and they work with a lot of strong, technical Partners. So stay tuned for more on that. But we will have everyone involved as we get out into more details about the Rare Earth elements and critical minerals.

1 month. We get a more material update next, um, before your earnings potential or is that too soon?

I'm sorry, I didn't understand the question. What was it? I, we would, we would expect to, to, to comment, to some degree on it. You know, next quarter. But then, you know, in coming quarters, we'll continue to, you know, provide, you know, updates as we move forward, George, but work to do.

Volume upside in the prb OR Northeast without material capex. How do we try and get 5 or 10%, higher capacity, factors to your margins and pricing in the prb and pamc and then just lastly, on that is the potentially more upside in the pamc given, there's more demand growth in the Northeast for that domestic Market versus the prb.

Yeah, I would, I would sit there and tell you George, you know?

A couple things first we are encouraged. As I mentioned before that, we are seeing a lot of investment. Now in in the coal, Fleet you might not hear about it so much publicly. But um we are talking to our customers and we're all we are seeing them invest in their coal. Fleet in anticipation in anticipation that the are going to be running at much, higher capacity factors for for a period of time here and a lot of that has to do again. As, as you mentioned with the data center and AI buildout. Um, you know, we think that in total, we could see domestic Coal, Fired generation increase by 20 30%. And if you look at call it, 400 million tons of of coal being uh burned today your your additional 60, 800 million tons potentially. Uh not so far in the distant future. Um,

You know, we we can continue to invest in our our operations. I think, you know, we always say 26 million, tons is our base case at pamc. Uh, we do have ability to ramp up if the Market's there, um, and I'll tell you that we may get there, right? As I mentioned earlier, 26 million tons of new sales, last quarter, all the way out through 2030, so it is encouraging.

We're starting to get a lot of um, visibility on, uh, the fact that these domestic utilities are going to continue to run. Uh, we'll see here as as you know more data centers are committed for buildout. Uh, there's a lot on the on the docket here and if that comes to fruition, I think yes we will continue to invest to see if we can grow production, not only at pamc, but also out in the prb

And George. If you look at at all these data centers are getting built out, a lot of them are in the East and I think PMC is sitting right on top of all those, right? So I think you're going to obviously see some competition from natural gas, but if you listen to some of the earnings call of uh industrial companies, they are saying like if you want a new gas turbine, you're going to have to go back in line, 2029 2030, right? So that's going to be this period where um, you're not going to get a lot of uh incremental juice out of the gas plants and call us. Coal is a natural pivot here, 24 by 7 consistent Powers power dispatch and that's what these Data Center and AI applications need. So I think we, we are very excited about it and um, PMC as well as our Western operations, are going to continue to benefit, I think.

We're seeing increasing interest uh, from Eastern utilities on our West, our call as well. So I think that supports that trend

You know, and George, just to, to comment. I mean, you know, I we would say at this point, you know, you're already seeing this to your point. We're already running at 50% capacity Factor, but coal consumption year to date of about 35 million tons, uh, could be up as much as 45 million tons depending on how weather goes for the full year. That's a big step up. So, in terms of implications for pricing, we'll see. But obviously another year or 2 of that is going to put some stress on on Supply without a doubt. So could have positive positive implications there.

Yeah. Okay thanks guys. And last I'm sorry, maybe mesh again. I think this is next question before. But can you remind us potential timelines of when these insurance proceeds will come in? Should we expect all of the funds to be in sort of middle of the next year? Potentially, and also, just a reminder on the Baltimore Bridge proceeds too. Please

Yep, so um I wish I can give you an exact time, George. Uh, but um, I think this is 1 where, um, we got we are starting to submit claims, um, you know, as we get the receipts and everything in place as the first, uh, line of action on your South which is, which is what we have been doing. So the claim that we just received uh we submitted that claim for like 3 4 months ahead, so there's that lag. Um, we submitted on other claim. Um, in October, I hope we can get this uh, um, early next year. So, we'll continue to do that and I think it's going to Trickle.

I wish I can give you like an end point. Um, the business Interruption claim, tends tends to be a little bit, um, longer gestation period. So to speak uh it takes a while going back and forth on assumptions and stuff like that. So I think we are working through that. I think we have made a lot of uh progress um on the Baltimore cream as well. We'll see. Um, I hate to give you like a end date but I think um,

We, we expect most of those to be collected next year.

Okay. Yep. Thanks guys.

Thanks, thank you. Okay, thank you.

Next question comes from Matthew key of Texas. Capital Bank. Go ahead.

And 2q the guidance on merger related. Synergies were increased to 150 to 170 million. I was wondering what percentage of that Target. Have you guys achieved at? Kind of at the end of uh, 3Q. And if there's any other kind of incremental cost savings that you see um kind of as as you played this up,

Yeah.

Um, this is Natasha, I think, um, we have made a lot of progress on that front and that number is a little bit higher on an annualized, run rate as well. Um, and we'll continue to grind it up. Uh, there are few other things that we are working on, but just in terms of what we have actually achieved, I think if you look at our sgna Trend Q4 Q3 versus, um, what you saw in q1 and Q2 it kind of reflects some of it, you're seeing that also in the, um, byproduct sales revenue as well. I think on an aggregate, I think we are probably 50%. Um, that's probably flowing through, um, the current year, but we, a lot of that is going to flow through next year, for example, sgna is going to have full run rate next. Um, starting second quarter of next year, we have some systems on the it front, um, that that are rolling off, some of them rolled off in September. So you haven't even seen that impact in the September numbers yet. I think you'll continue to see that in the final system. Roll off happens, I think sometime in April so I

I think you will see um, those numbers uh, flow through. So I think the way to think about, uh, full run rate. Uh, I would say sometimes second quarter next year, uh, but um, we are

We are making uh a lot of progress on that front.

Yeah, I appreciate that. That's super helpful and uh assuming work at Lewis South, you know, the restart there goes his plans. Um, I was wondering if the company would incur any, you know, additional fire Extinction, idling costs that kind of bleed into 1 q26 or would 4 to you kind of be the end of end of that dynamic.

I think for Q will be the end of it. Particularly, if, you know, we get some help here from the government, like I said, we're ready the teams ready to go recover these shields. So we don't, we think what will be left? Will be the, you know, the I expense that's left that will obviously carry it to Q4 here. But if we get to recover our Shields, the long wall face is already mined and set up and ready to have to receive the new shields. So, we'll have all that done in Q4 and, you know, there is a possibility if we were turned loose in time and we can't get all the sales that we could actually have production like in Q4, you know, out of the air South. So it's all it's all based on timing now. But I do think we will have this put to bed in Q4 of this year. As far as the fire related costs.

Got it. That's uh, that's super helpful. Appreciate the time. Gentlemen and uh best of luck moving forward.

Next question comes from Nick Giles of B Riley Securities. Please go ahead.

Thanks for taking my follow-up. I just wanted to ask about uh hi CV, volumes as we look to the fourth quarter. I think your annual guide, uh the midpoint might imply a slight tick up, but could you just give us some some color on? You know what could take us to the higher low? End of the range? Are there any longer moves? Um, thanks a lot.

Yeah, I would, I would say that um, you know, right now contracted wise, you know, we're in that 7 to 7 and a half million ton range, um, you know, pmc's running very, very well right now. There's a potential we could have a long wall move hit sometime in December. A lot of that. We originally anticipated that in q1 of next year but based on based on the mind running very well. It could, it could funnel in, um, the Big Driver there to get to the top in the guidance will be the return of West Elk, which is Jimmy mentioned earlier. Uh, we're anticipating next week. So all goes well, long well runs very well. You could see us, you know, creep up toward that upper end of the guidance range.

Yeah, and we do have 2 long all moves remaining in Q4 for PMC and, and just a minor Point too, right? Like, uh, we provide sales, guidance, not production, guidance, right? So we, we have inventory, um, at the end of the third quarter, which you saw probably in the working capital too. So it depends sometimes on, you know, how many boats show up in that last couple weeks of December and that these dock, the inventory. So that that could drive a little bit of a upside down side, as well.

Got it. Um, guys just fell. I have you, I mean, you know in in recent years, you've spoken about uh you know, what's the maximum number of volumes that you could send into the seaborne market. But today, you know, just with how robust the domestic Market is what would kind of be the limitations on uh, on those volumes.

That are right. I mean, we are now 4.

The question becomes: how is the international market, and can we get more volume out of PMC? So, sitting here today, as I mentioned, 14 million tons, we have contracted right now 10 million tons domestically. We're still in negotiations for additional business next year, so we'll see how that all plays out. But, you know, PMC is running very well, so if we can continue to keep on that pace, we certainly could increase some more volumes and get them export ready. However, I would say domestic is going to be year-on-year improved.

But it works well for us, Nick compared to, you know, we've always said in the past that we run to the market. So here's another opportunity and we run to the highest Arbitrage. So wherever that may be if it's domestic or International, we certainly have the ability to get it there, you know, and Nick you you talked about the highest TV thermal segment as a whole but you know, West Elk. Also selling, you know, more power, gen coal today. And as you know it, as this story comes to fruition, you know, we could continue to direct more tons into the domestic power gen Market from West Elk and plus, you know, oh, by the way at at, uh, you know, in the B Team, you know, we certainly have the ability to run at much higher levels, uh, in that thicker, coal seam, so additional opportunity there,

Yeah, it's great to hear. Uh, thanks again, and good luck.

Thank you, thanks.

There are no further questions at this time. I'd now like to turn the call back over to the Jimmy Brock for final closing comments.

Yeah. Uh thanks everyone for joining our call today. We look forward to speaking with you in the future and we're excited about work. Core natural resources can be

Ladies and gentlemen, this concludes your conference call for today. We thank you for participating and ask that you please disconnect your line. Have a great day.