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Greetings. Welcome to Alliance Resource Partners LP Fourth Quarter 2024 Earnings Conference Call. At this time all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce Cary Marshall, Senior Vice President and Chief Financial Officer. Thank you. You may begin.

Thank you, operator, and welcome, everyone. Earlier this morning, Alliance Resource Partners released its fourth quarter and full-year 2024 financial and operating results and we will now discuss those results, as well as our perspective on current market conditions and outlook for 2024. Following our prepared remarks, we will open the call to answer your questions. Before beginning, a reminder that some of our remarks today may include forward-looking statements subject to a variety of risks, uncertainties and assumptions contained in our filings from time-to-time with the Securities and Exchange Commission and are also reflected in this morning's press release. While these forward-looking statements are based on information currently available to us, if one or more of these risks or uncertainties materialize or if our underlying assumptions prove incorrect, actual results may vary materially from those we projected or expected. In providing these remarks, the partnership has no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise, unless required by law to do so. Finally, we will also be discussing certain non-GAAP financial measures. Definitions and reconciliations of the differences between these non-GAAP financial measures and the most directly comparable GAAP financial measures are contained at the end of ARLP’s press release, which has been posted on our website and furnished to the SEC on Form 8-K. With the required preliminaries out of the way, I will begin with a review of our results for the full-year and the fourth quarter, give an overview of our 2025 guidance, then turn the call over to Joe Craft, our Chairman, President and Chief Executive Officer for his comments. During the full-year 2024, total revenues were $2.4 billion, adjusted EBITDA was $714.2 million, net income was $360.9 million, and earnings per unit were $2.77. Coal sales volumes came in at 33.3 million tons, which was 1.1 million tons lower than full-year 2023. The lower volumes in 2024 were primarily caused by elevated customer inventories, mild weather, and low natural gas prices. Operationally during 2024, we had to contend with reduced volumes across the Appalachia region, primarily caused by difficult mining conditions at Tunnel Ridge and Mettiki, shipping delays at MC mining, and lower production in the Illinois basin, due to unattractive export pricing for high sulfur coal. While full-year results fell short of last year's record revenues in net income, we stayed focused throughout the year on what we could control, executed strategic capital improvements at a number of our mines, and delivered outstanding safety results. Turning now to our fourth quarter results, total revenues were $590.1 million for the fourth quarter of 2024, which we refer to as the 2024 quarter, compared to $625.4 million in the fourth quarter of 2023, which we refer to as the 2023 quarter. The year-over-year decline was driven primarily by lower coal and oil and gas prices, reduced coal sales volumes in Appalachian, and lower transportation revenues, which more than offset higher oil and gas royalty volumes and higher other revenues. Due to the continued strength of our contracted order book, our average coal sales price per ton for the 2024 full-year of $63.38 came close to the record level achieved in the 2023 full-year of $64.17. Focusing on the 2024 quarter, total coal sales price per ton was $59.97, a decrease of 1% versus the 2023 quarter and 5.7% on a sequential basis, primarily due to higher spot shipments in both the domestic and international markets during the 2024 quarter. As it relates to volumes, total coal production in the 2024 quarter of 6.9 million tons was 12.4% lower, compared to the 2023 quarter, while coal sales volumes decreased 2.3% to 8.4 million tons, compared to the 2023 quarter. Total coal inventory at year-end was 609,000 tons, achieving our year-end goal. In the Illinois basin, coal sales volumes increased by 2.8% and 10.5%, compared to the 2023 and sequential quarters as a result of increased volumes from our Riverview, Hamilton, and Gibson South mines. Coal sales volumes in Appalachia were down 17.1% and 24.6%, compared to the 2023 and sequential quarters due to continued challenging mining conditions, particularly at Tunnel Ridge and Mettiki, which led to lower recoveries. Turning to cost, segment-adjusted EBITDA expense per ton sold for our coal operations was $48.09, an increase of 12.1% and 4.3% versus the 2023 in sequential quarters. The impacts of the lower volumes I just discussed in Appalachian in an $11 million non-cash deferred purchase price adjustment related to the 2015 acquisition of the Hamilton mine in the Illinois basin were the primary drivers of the increase. Specifically with regards to Appalachia, Tunnel Ridge had reduced shipments as unfavorable mining conditions repeatedly impacted longwall advance, causing production to be 466,000 tons below our expectations for the 2024 quarter. Mis-shipments will be carried over into 2025. Additionally, due to market uncertainty at MC Mining, we decided to lower annual production by approximately 230,000 tons by dropping a production unit. We now plan to run two production units at MC Mining for all of 2025 in an effort to reduce operating costs. In our royalty segments, total revenues were $48.5 million in the 2024 quarter, down 8.6%, compared to the 2023 quarter. The year-over-year decrease in revenues reflects lower realized oil and gas commodity pricing that more than offset increased oil and gas volumes and coal tons sold. For the full-year 2024, oil and gas royalties achieved another record year of volumes on a BOE basis. In the 2024 quarter, oil and gas royalty volumes increased 1.7% on a BOE basis, while coal-reality tons sold increased 9.4%, compared to the 2023 quarter. The improved volumes from oil and gas resulted from increased drilling and completion activities on our properties and acquisitions of additional oil and gas mineral interests. Sequentially, oil and gas royalty volumes and average sales pricing per BOE declined. Coal royalty revenue per ton for the 2024 quarter was down 3%, compared to the 2023 quarter, while lower oil and gas prices reduced the average realized sales price per BOE by 17.2% versus the 2023 quarter. Sequentially, coal royalty revenue per ton was relatively consistent, and oil and gas royalties average prices were down 7.3% per BOE. Our net income in the 2024 quarter was $16.3 million, as compared to $115.4 million in the 2023 quarter. The decrease reflects the previously discussed lower coal sales volumes and realized prices, lower realized prices in oil and gas royalties, $13.1 million of non-cash accruals for certain long-term liabilities, and a $31.1 million non-cash impairment charge due to market uncertainties that led to our decision to reduce production at MC Mining. These decreases were partially offset by a $14 million increase in the fair value of our digital assets. Adjusted EBITDA for the quarter was $124 million. Now turning to our balance sheet and uses of cash, our total and net leverage ratios finished the year at 0.69 times and 0.05 times respectively total debt to trailing-12 months adjusted EBITDA. As a reminder, we issued $400 million of senior notes in June of 2024, allowing us to redeem our outstanding 7.5% senior notes that were due in May 2025. Total liquidity was $593.9 million at year-end, which included $137 million of cash on the balance sheet. Additionally, we held approximately 482 Bitcoin on the balance sheet, valued at $45 million at the end of the 2024 quarter. For the full-year 2024, Alliance generated free cash flow of $383.5 million after investing $410.9 million in our coal operations. Additionally, we successfully acquired $24.7 million in oil and gas mineral interest, all in the Permian Basin. Specific to the 2024 quarter, we completed two acquisitions of mineral interest, totaling $9.6 million for approximately 490 net royalty acres. Finally, we declared a quarterly distribution of $0.70 per unit for the 2024 quarter, equating to an annualized rate of $2.80 per unit. This distribution level has unchanged sequentially and, compared to the 2023 quarter. As a reminder, each quarter, the board considers multiple factors when determining the appropriate distribution levels, including, but not limited to expected cash, operating cash flows generated by our business, capital needed to maintain our operations, distribution coverage levels, implied yield on our units, current and possible investment opportunities, and debt service costs. Turning to our initial guidance detailed in this morning's release, as we begin 2025 for ARLP, we see gradually improving market fundamentals, a contracted order book that is filling up, and as usual, the opportunity to flex additional tons to domestic or export customers should market conditions warrant the move. We are also encouraged by many of the early moves of the Trump administration. In particular, it's focused on the strategic need for grid reliability and affordability and their understanding of the critical need for coal plants to help meet growing electricity demand for many years into the future. We anticipate ARLP's overall coal sales volumes in 2025 to be in the range of 32.25 million tons to 34.25 million tons with over 78% of these volumes committed and priced at the midpoint of our guidance range. Coal sales volumes in 2025 are roughly flat with 2024 at the midpoint, with higher volumes anticipated from Tunnel Ridge once they move to the new Longwall District in May of 2025. Currently our committed tonnage for 2025 is 26 million tons including 23.5 million domestically and 2.5 million to the export market. The frigid winter weather at the start of this year drove natural gas crisis higher and increased coal consumption in the Eastern U.S., helping reduce customer inventories. We are seeing domestic customer solicitations for both near-term and long-term supply contracts, supporting our belief that domestic sales will be higher in 2025, compared to last year. We are guiding sales pricing by region to a range of $50 to $53 per ton in the Illinois Basin, which compares to $56.44 per ton sold in 2024, and $76 to $82 per ton in Appalachia, which compares to $83.53 per ton sold in 2024. Our expected realized full-year 2025 price is based on a combination of our contracted order book and our expectations for additional contracting, both domestic and export, for the open position. On the cost side, we expect full-year 2025 segment adjusted EBITDA expense per ton to be in a range of $35 to $38 per ton in the Illinois basin, as compared to $37.81 in 2024 and $53 to $60 in Appalachia, as compared to $64.67 in 2024. During the full-year 2025, we have two scheduled longwall moves in February at Tunnel Ridge in Mettiki, another longwall move at Tunnel Ridge in the second quarter of 2025, and one at Hamilton in the third quarter of 2025. On a net-net basis, we are anticipating a material improvement in full-year costs that is expected to roughly offset the lower realized pricing forecast in our coal business for 2025. On a quarterly basis for 2025, it is reasonable to assume cost per ton to be highest in the first quarter as coal sales volumes are anticipated to be approximately 6% to 10% lower than the 2024 quarter as a result of the two longwall moves and as we finish our four major infrastructure projects that we have discussed over the past two years. Second quarter 2025 coal sales volumes are anticipated to be more in line with the 2024 quarter. The added volumes, as well as the cadence of longwall moves, means we expect cost per ton to decline sequentially throughout the balance of 2025. In our oil and gas royalties business, we expect sales of 1.55 to 1.65 million barrels of oil, 6.1 to 6.5 million McF of natural gas, and 775,000 to 825,000 barrels of natural gas liquids. Segment adjusted EBITDA expense is expected to be approximately 14% of oil and gas royalties revenues for the year. On a BOE basis, this would represent another record year of volumes. In 2025, we are guiding to $285 million to $320 million in total capital expenditures, which excludes oil and gas minerals' growth capital. This is down significantly from 2024 capital expenditures of $429 million as we near the end of a roughly two-year period of elevated capital spend to make long-term strategic investments in our Riverview, Warrior, Hamilton and Tunnel Ridge mines that ensure their reliable, low-cost operation for many years to come. We expect remaining work from these projects to be completed in early 2025. For distribution coverage purposes, estimated maintenance capital per ton produced has been updated and reduced to $7.28, compared to $7.76 per ton produced in 2024. Additionally, we remain committed to investing in our oil and gas minerals business and we will actively pursue growth in this segment in 2025 with the ultimate amount of investment dependent upon the number and quality of the opportunities available and their ability to meet our underwriting standards. And with that, I will turn the call over to Joe for comments on the market and his outlook for ARLP. Joe?

Thank you, Cary, and good morning, everyone. As Cary mentioned, both the fourth quarter and the full-year of 2024 presented many challenges beyond our control. We entered 2024 knowing that elevated inventories held by our domestic customers were going to limit spot opportunities. Thus, we concentrated on booking commitments for more than 90% of targeted production. Unfortunately, that was not enough as low export prices, mild weather, and lower-than-expected natural gas prices were a consistent thing throughout the year resulting in reduced sales volumes below 2023 levels. Difficult mining conditions at our Appalachian operations also adversely impacted our results for the full-year. Notwithstanding these headwinds, I must thank the entire Alliance team for their dedication and resilience in delivering solid results. Our balance sheet is strong. We substantially completed the major infrastructure projects at Tunnel Ridge, Hamilton, Warrior, and Riverview, and I'm particularly proud that the fourth quarter full-year, 2024, was one of our safest periods ever with safety statistics 34% below 2023 and company-wide results finishing below the national average. We enter 2025 with high expectations. We expect improved coal production costs to counterbalance lower market prices, keeping coal segment margins near 2024 full-year levels. The cold winter weather at the start of the year drove natural gas prices higher and increased coal consumption across our customers' facilities, helping reduce inventories. We're seeing significant customer solicitations for both near-term and long-term supply contracts and anticipate our contracted book to more closely approximate typical contracted levels in the coming weeks. The longer-term outlook for our markets continues to strengthen, driven by two factors: unprecedented expected growth in base load power demand; and an increasing focus on grid reliability. The rapid expansion of data centers and AI infrastructure you've heard us discuss for some time now is fundamentally reshaping utility planning across our markets, particularly in PJM and the MISO regions. Recent developments, including PJM's ten-fold increase in capacity payments we highlighted on our last call, reflect growing recognition of reliable baseload generation's value. Today, that only can come from coal, nuclear, and combined cycle gas plants. And with no new nuclear capacity and construction and limited natural gas generation coming online, the need to keep coal in the mix has never been clearer. Driven by this reality, several utilities have either already or are now considering extending their coal plant operations beyond 2030 and increasing their coal burn forecasts across their fleets. A particular note is that this has transpired under regulatory framework of the previous administration. The new administration's early actions including an executive order to “Unleash American Energy”, where coal is explicitly mentioned as one of these resources, declaring an energy emergency, withdrawing from the Paris Accords and suspending subsidies to fund expensive renewables that don't produce on-demand power, signal a shift towards a common-sense approach to energy policy. This regulatory environment should support the continued operation of strategic coal generation assets and align with the physical realities of maintaining grid reliability amid growing baseload demand. On the oil and gas royalties front we once again achieved record volumes in 2024 even with only modest additions to our overall acreage. While commodity price volatility makes acquisition timing unpredictable, we remain committed to growing our oil and gas minerals portfolio, while maintaining our investment underwriting standards. We continue to favor the cash flow generation profile in the oil and gas royalties business, and over the long-term, our expectations of it becoming an increasingly large part of our overall portfolio are unchanged. Another notable highlight during 2024 has been our Bitcoin mining operation, which as previously disclosed began in 2020 as a pilot project to monetize underutilized electricity load capacity at our mines. This operation positively impacted our net income during full-year 2024 with a $22.4 million positive change in the mark-to-market value of our digital assets. As Cary mentioned, the fair value of our digital assets was approximately $45 million a year in, based on a Bitcoin price of roughly $93,000. During the 2024 quarter, we invested $5.9 million to replace one-third of our existing Bitcoin mining machines, which will improve total fleet efficiency by approximately 30%. At Alliance, we remain focused on providing reliable, affordable base load energy, while creating sustainable value across both our coal operations and royalties business. We have a strong balance sheet and industry-leading cash generation capabilities across business cycles, which positions us to execute strategic capital improvement programs at our assets, grow our minerals business and return capital to unit holders. With market conditions improving our inventories at normal levels, our capital investments largely complete, and costs projected to significantly improve, we are well positioned for 2025. That concludes our prepared comments. And I'll now ask the operator to open the call for questions. Operator?

Thanks, Operator. Good morning, Joe. Good morning, Cary.

Good morning, Nate.

Good morning.

Given all the discussions around tariffs over the weekend today, Joe. I want to start out just asking for your thoughts on how you believe some of those recent announcements, as well as any potential retaliatory tariffs could impact the ARLPs business? And really the coal markets in general?

It's hard to answer that question not knowing exactly what President Trump is totally focused on cheating. I think on the most recent one, the only Canada and Mexico, it's clear that his message is to try to focus on [fentanyl] (ph) on the border. So, I don't think that the efforts for tariffs are intended to create any type of -- terror of war, so to speak, like maybe Canada's reacted to. So I think it appears to me that his efforts utilizing terrorists is largely negotiating. So it's really hard to know from my perspective exactly how that may impact us. I think specific to Canada and Mexico, it would be limited. I'm not sure that there's any products that would impact us. I mean, they've had -- they've dialed it back on energy. We saw today that energy prices actually benefited from that announcement, I believe. As far as beyond that, the tariffs to China should not impact us that much. Most of our products are domestic-based. We do have products that we're buying from Europe that we don't see right now that there will be any impact. So we're not anticipating anything at this moment, but things are moving fast in Washington, D.C., so it's really hard to predict with any certainty what's going to happen tomorrow.

Makes total sense, Joe. Thanks for those thoughts. Shifting to the commitments, you guys committed an additional 2.5 million tons to the domestic market, looks like, for ‘25 since last quarter. It has you sitting at 23.5 million tons, you know, trailing historical levels at this point, I believe, and clearly the 30 million ton coal you guys have for domestic shipments. But Joe, you did mention the contract book should more closely match normal levels in the coming weeks? How confident are you can get to that 30 million ton number? Do you need the kind of cold weather to continue that we've seen or plant retirements to get delayed? Additionally, just thinking back to last quarter, I think you guys said you were in the process of finalizing commitments on nearly 22 million domestic tons over the next few years. Can we get any update there?

Yes, so I think that we continue to have a goal to get to 30. Our guidance doesn't have us going to that level. I think that as far as where we are, as I mentioned in my prepared comments, we have conversations going on right now that we hope to conclude within the next two or three weeks that are impactful that will add some volume. We continue to have conversations as we again discuss. Essentially all our customers indicated strong burn and that there will be opportunities this year for additional times. We know that there are also conversations for two to three year type contracts, as well that will occur over the, you know, it's hard to say whether it will be done this quarter or towards the end of the second quarter. But we're very confident in the actual production and sales targets. I'd like to believe that they're conservative, but we're in good position. I think the one area that we have been disappointed in ‘24 as the high sulfur export market. And we know the demand is there, but the pricing has not been at levels that we felt that we wanted to participate in. So there is about 600,000 tons in 2025 that we would like to sell into that export market for our high sulfur production. But if it's not there, then we feel like we can't place it in the domestic market. So we're starting from a lower base than we were a year ago. Last year was disappointed in that we didn’t -- we weren't able to hit our sales commitments and therefore not our production commitments. But this year, I think we've sort of put our guidance to something comparable to 2024, which I believe we're in a different situation, because of where the inventories are with our domestic customers to where we've got more upside this year than we did a year ago.

Thanks for that, Joe. And then maybe just for the tons that you guys are having conversations on now, clearly I know you don't like to speak about price, but maybe if I just think at a higher level, pricing on those tons are basically the market in general right now? Would you say that would fall in your guidance range for full-year 2025?

Yes, definitely. It's definitely been included in our guidance ranges. So I think that…

Okay.

Yes, we've definitely -- we've advanced the conversation sufficiently enough that we're comfortable to include those in our guidance numbers. Feel pretty good about that.

Okay, great. And then just, you touched briefly on the actual markets. And I think the high sulfur discounts were something you guys pointed to earlier. API2 prices, I think, off the recent lows, but still around $110 or so a metric ton. You know, what kind of netbacks are you guys seeing at these levels? You know, and again, what kind of API2 price do you need to kind of incentivize more tons to move into the excellent market?

Yes. So again, I think from the low sulfur markets, we're able to count on those. So I think from an export standpoint, we could be at levels comparable to ‘24 since most of that was either a [Metco] (ph) or what we shipped from MC Mining, as well as our lower sulfur or Gibson product. So our only real vulnerability here for the lower price in trying to target that is that $600,000 I mentioned for the high sulfur market, and it's still at levels that are significantly below what our domestic alternatives are. So we will see if that changes towards the end of the year. So I'm going to give an actual cost number, because it's not meaningful. So I think the real issue is whether we end up selling those tons in the export market or the domestic market. And right now, I think that based on the feedback we've gotten, everything depends on what, “normal weather is for the balance of the year, specifically in the summer” what the demand would be in the back half of the year for spot shipments in the domestic market. So I think we've got 600,000 tons basically that are an issue there. But I do believe that on the domestic side that we may have more opportunities at our other coal mines that could make up that difference. So again, I feel very comfortable at the midpoint of where we're guiding on sales this year and I'd like to believe that's conservative and we'll be able to increase that.

Okay, great. And then just maybe one last thing. Could you guys remind us how many domestic tons versus export tons you ended up shipping in 2024? And then Joe used to earlier likely to ship or hope to ship more tons domestically this year versus last year?

So I think for, Nate, for 2024, our domestic tons were just a shade under 28 million tons this past year, and so the balance was export. So we did about 5.6 million export, 27.6 on the domestic side. So export volumes this year were actually up versus previous year.

All right, Cary, I appreciate that. Very helpful, guys. Thank you for your time. Best of luck in ‘25.

Our next question is from Mark Reichman with Noble Capital Markets. Please proceed.

Yes, Just a quick question on Appalachia. Last quarter you had mentioned that both Mettiki and Tunnel Ridge that you would be into a new district. And so some of those geologic problems would go away? So are you there yet? I mean, do you expect any of that to spill over into the first quarter of 2025? Or is the operational issues, is that in the rear view mirror at this point?

As Cary mentioned, we've got two longwall moves, both at -- one is at Tunnel Ridge and one is at Mettiki in February. So we are hopeful at Mettiki with the next panel things are going to be improved and therefore our costs will be improved. Starting with the next panel in Mettiki, as far as Tunnel Ridge. The next move is still in the same district. It's another small panel that will be completed by May, early May, to when we will be moving to the new district. And so that's where we should start seeing significant improvement for Tunnel Ridge starting May going forward when we get into those longer panels. Now, having said that, January came in a little bit better-than-expected right at the end of this panel. So hopefully this next short panel between February and May will definitely be -- we are hopeful it will be better than what we've experienced at Tunnel Ridge. This last panel was one of our toughest, to be honest, from a mining condition standpoint. So we're hopeful that this last panel will be better than the one we're completing. We're very confident that once we move into the new district in ‘25, we will see Tunnel Ridge getting back to production levels like we've been historically used to there. So we -- I think Mettiki continues to be hard to predict. You know, we just felt that with our drilling program, we're seeing results that the drilling program and just the development is not correlating to the confidence level we typically have. So that's the one mine that is hard to predict. But I think all our other operations, we feel a lot better about our geology in 2025 than what we experienced over the last year really in the Appalachia region.

That's helpful. And then on the total segment adjusted EBITDA expense per ton for the coal operations, I mean I think the guidance was $43 to $45 in the fourth quarter. I think it was $48.09. Obviously, the costs were elevated in the third quarter as well. So your new guidance is $40 to $44, so a delta of $4 a ton. What would cause you to be kind of at the low end versus the high end there?

I think when you look at the low-end versus the high-end, it's going to be in the guidance ranges that you have for us, Mark, when you take a look at that. So when you look at our guidance range, if you're at the midpoint, as we were talking about, $33.25 or something like that, I think is the midpoint of our guidance range. So if we can get to the upper end, I think what that's implying is, is you're probably going to have a little better marketability, say, for like the export market, for what we're talking about there. So a lot of the benefit that you would have there would be coming out of the Illinois Basin region and being able to ship into that particular market. And so that can benefit you overall when we look at the weighted average cost side and get to the upper end of that range.

I would add just what Cary said is that we know in the first quarter at Appalachia our costs are going to be higher back to the fact that we're not into the longer panels at Tunnel Ridge until May. So until we get out of those panels, it's going to be hard to get to the lower end of the range on the App side. And so there is a timing issue where the first quarter is going to be a little higher than what we expect in sequential quarters after that.

Yes, and I think we tried to address that in some of the prepared remarks where we were trying to let you know that it does look like first quarter volumes will probably be down 6% to 10% over this previous quarter overall. But we do as we get into these conditions, better conditions as Joe mentioned, we do anticipate gradually improving costs on a quarterly basis throughout the year.

Yes, so that volume is back to the two longwall moves.

That's right.

Plus dropping a unit MC Mining.

And then just the last question, the guidance on the oil and gas royalties business. It looks to me like kind of modest growth. It doesn't factor in acquisitions. But on the acquisitions front, we hear a lot of commentary, Kinder Morgan and others pretty bullish on natural gas driven by LNG and growth in electricity demand. Do you think you’d kind of maintain your heavy oil weighting or do you think at some point you might entertain more gas weighted acquisitions?

No, I think as I mentioned previously, we are active in Delaware Basin, which is a little bit more gas exposure than what Midland has had. So I think that we will look at each opportunity as they present themselves. But I would say we're still going to be more focused on the liquid side of the business. It's just a little more predictable. As far as pricing, we do see gas prices. The curve today is better than it was a year ago, which is good. There's still expectations that gas prices will be higher, like you mentioned. So we will not shy away from investing in gas, and it's still a valuable byproduct, or it's still a product that we are investing in. So it's not like we don't get gas when we buy the minerals that are higher percent oil. So we benefit from both. But as far as trying to go to the Hainesville and something that's up to Utica or Marcellus, I think our focus is still going to be more in the Permian.

Well, thank you very much. I appreciate the -- really helpful, and I appreciate the clarity.

Our next question is from David Marsh with Singular Research. Please proceed.

Hey, good morning, guys. Thank you very much for taking the questions.

Good morning, Dave.

Hey, good morning. Just wanted to start on the pricing side for your forecast for 2024. I mean, obviously, you guys have -- it looks like there's certainly a prevailing thought that we're going to come down, particularly in the Illinois basin on pricing this year. What are some factors that might actually help that swing back up? Is there a potential upside to what you're guiding to there?

I mean, it’s all about supply and demand, right? So weather will be a factor. I mean, we’re not seeing -- we are seeing production being stable to down. And I think that when you look at power demand, the demand was good last year. It's just that the deliveries were not at a level, because they had elevated inventories. So I do believe that demand is going to be strong and then it's just a matter of really weather that's going to determine whether that we can have some type of supply-demand imbalance, it could push the prices up a little bit. I think that there's still some difference between a spot price and a contract price. And I believe that contract prices are going to have to support, you know, longer term contract prices will have to support prices higher than what you see in the indexes to incentivize the supply to be there. So our guidance is really driven to the prices that benefit from the contracts we have, but also anticipated with the price point that we're talking to our customers about. So whether the guidance back of what can happen this year is really going to be on the spot price as to how that could increase the higher end of the range than on the contract prices that we're negotiating right now. I mean those are already built in. So there is -- like I said, if the weather cooperates to where we're higher than normal in the summer, you could see some upside in the price or the spot tons that we got built into the back half of the year.

Got it. Okay. That's helpful. And then just on the digital asset side, I mean, you guys have amassed a nice holding at this point. Could you just talk about what your planning is there in terms of your -- whether to hold, whether to sell it at more favorable spot prices? I mean just kind of talk about how you think about that asset. Obviously, it's become more meaningful at this point?

Historically, we've taken an approach of covering our expenses on a monthly basis by selling sufficient and then holding the balance. And we do believe based on the model that prices will continue to go up. I think the Trump administration is very, very supportive Bitcoin in particular, but Crypto generally. So we have decided that for January, we will not cover expenses. We think that there's more upside and we're going to continue to monitor closely the policies of the Trump administration to determine whether we should continue to hold or whether we should revert back to what we've been doing in the last year or so of just adding -- not putting any more investment into Bitcoin by selling cover our expenses. So we'll -- by the end of the quarter, we'll make a judgment based on what policies we see occurring I still think that may or may not -- how that will impact our whole decision or our monetization. So but to-date, we have not sold any Bitcoin beyond just doing what we needed to do just to cover our expenses on a monthly basis.

Right, right. Okay. Just wanted to get that update that. I appreciate that. And then just lastly for me, just in terms of the administration change, obviously, very favorable. Could you just talk about, you know, any efforts by the company to better engage the administration or any outreach from the administration to the industry and the company in general? And just talk about anything that you can provide in terms of color in terms of desire to keep plans open longer to help satisfy energy demand?

You know, we're very active and trying to determine the proper policies for the Trump administration. They've got several fronts that they are trying to determine how to make government more efficient with the dose as an example. So there are areas of redundancy, where things are being done, because they've always been done that way, regulations that have been on the books for 20-years, for reasons 20-years ago, it was relevant. But to-date, it's not. So we're doing what we can to educate the Trump administration. Here's a slew of regulations that we live with every day that don't make any difference today in today's economy with the technology that we have and the ability to remove certain regulations that are just increasing costs with no real benefit as an example. You've got six or seven regulations that Biden administration put in at the last minute, just to try to reduce coal production primarily, as well as for our customers to discourage the coal plants from staying open. All those are being addressed. So we, again, are working with our customers and trying to make sure that the communication to the Trump administration is consistent to be able to address the concerns with having both the volume of production they want, but the grid resilience that they're looking for. So again, there's open dialogue where the Trump administration is reaching out to us. I'm sure to others, but to us, in particular, but also to our association wanting input on areas where they can achieve their goals and their objectives. We also have the tax area that's important to the Trump administration's important to us that we're, again, trying to educate and make sure everybody understands the importance of the MLP structure and bonus depreciation and things of that nature. So there's significant dialogue, so that the Trump administration can achieve their goals and objectives to reduce unnecessary regulations that are impacting permitting or impacting safety or impacting return on events. Exporting, I mean, there's a whole list of things that the previous administration was doing to try to interfere with us being low-cost producers and expanding markets and maintaining markets that the Trump administration is doing just the opposite, they want us to make good return on our investments, but also be there for the long-term and plan for the long-term, so that America can have the energy it needs. I mean as I said in my prepared remarks, you can't just flick a switch and turn these things -- these policies overnight to get what you want. And Biden administration thought you can do that, but you could shut down coal and that all of a sudden, there would be replacements, and that was not the case. It is not the case. And right now, because of the demand increase that everybody continues to bleed in, every source of fuel is needed, including coal. And as I said in my prepared remarks, we believe and we're seeing every IRP that's coming out from our utility customers, they're all extending the life of their plants. And we've seen -- and we also see that they plan into not only extend the lives of the plant, but actually use them more in order to meet the demand that they've got for their customers. So we feel like victory in November is definitely positive for our company.

Great. Thank you guys so much. Appreciate it.

Thank you, Dave.

Our next question is from Dave Storms with Stonegate. Please proceed..

Good morning.

Good morning, Dave.

Just want to start with domestic inventory levels and maybe just a sense of how much further you think they would need to fall to maybe boost pricing? And if there's anything other than weather that you think would get those inventory levels lower?

I missed your first part of your question.

Just around domestic inventory levels and how much further you believe they need to fall to maybe increase pricing a little bit?

Yes. So I think that we're seeing, again, customer-by-customer, everyone is different, but we've definitely moved in the right direction to where in most cases, I think we're nearing that proper balance to where we don't have that overhang. So what we will see in ‘25 is if they have the same demand, but more than likely, it's going to be a little bit better, but that there will be more deliveries and that there's going to be that opportunity for us. We did not build that in the plan. As we said, we sort of stay where we were. So there is some upside there. As far as pricing, it's really going to be back on the supply side. And we're not privy to what other competitors are doing. We don't expect that there's going to be any increase and from what we can tell, the export market for our competitors to where they're exporting, it's the only -- there's some high sulfur producers that are in the export market that could bring more of their tonnage into the domestic, it's just hard to know. I don't know the -- I don't have visibility on exactly what you're doing. But -- so it's a supply situation, and it really just gets back to what our competitors are doing. And right now, I don't have a reason to believe that there's any increase going on. So I do believe we're in a position later in the year -- second-half of the year that we could see definite demand and the prices could be higher than what we projected in our plan. But I wish I had more visibility to answer that question.

Understood. Thank you very much. And then just one more for me. With the regulatory environment, are you seeing any notable changes in the oil and gas segment, maybe more increased demand for competition for secure properties?

Yes. Maybe if you could just repeat the question one more time. Just in terms of increased demand, I think in terms of the Permian, I think demand continues to be good for volumes coming out of the Permian Basin for us. So we feel very good with the properties where we're at in our locations in terms of our minerals portfolio for increased demands going forward.

And then just demand around acquiring new assets? Is that becoming a more competitive market maybe?

Yes, I'd say there is -- it is competitive. It's always been competitive. We do believe that there's going to be a lot of opportunity in 2025 for us to engage actively to try to be successful with acquiring some properties. So we do believe that there's going to be adequate demand, if you will. There's going to be several packages that we believe we'll be being auctioned off and we plan to participate in those and whether we're successful or not, we'll see, but we're not afraid of competition.

We have reached the end of our question-and-answer session. I would like to turn the conference back over to Cary for closing remarks.

Thank you, operator. And to everyone on the call today, we appreciate your time this morning and also your continued support and interest in Alliance. Our next call to discuss our first quarter 2025 financial and operating results is currently expected to occur in April, and we hope everyone will join us again at that time. This concludes our call for the day. Thank you.