The purchased reserves, for which 250,000 NRP common units were also included in the trade, are in Grant and Tucker counties in northern West Virginia. WPP turned the property over under NRP’s omnibus agreement with the company.
Part of the reserves, it noted, are leased by a division of Oklahoma-based Alliance Resource Partners.
Other reserves could be added to the agreement at a later time, the company said Tuesday, including another 100 million tons in Appalachia and 20 billion tons in Montana and North Dakota that is currently held by Great Northern Properties Limited Partnership.
“These additional reserves must be offered to NRP at the time that they become income producing,” the company stated.
Additionally, Canadian firm the Cline Group is required to offer present Illinois Basin reserves totalling 3 billion tons under that same understanding.
“These agreements give NRP significant built-in growth opportunities,” said NRP chairman Corbin Robertson.
“WPP, which is already a significant holder of NRP units, demonstrated its confidence in NRP's ability to continue to grow the partnership by taking approximately 60 percent of the total consideration in units."
In all, the property is anticipated to bring a return of about $5.9 million annually in royalty revenues based on a production rate of 2.4 million tons per annum.