Upon closing of the first transaction, NRP paid $10m, funded through its credit facility, and acquired approximately 3.3 million tons of reserves associated with the initial production from the mine.

The acquisition will begin generating revenue for NRP in the first quarter of 2010, and royalty income is expected to grow substantially as production at the new mine comes online. NRP expects approximately $12m in revenues in 2010 from the Deer Run mine.

Production from the mine is forecasted to be approximately eight to ten million tons per year, from which NRP anticipates receiving in excess of $40m per year of income. Based upon these production levels, the life of the mine is likely to exceed 20 years. NRP expects the acquisition to be accretive to cash flow in 2010.

Nick Carter, president and COO of NRP, said: “We are excited about the opportunity to acquire additional coal reserves in the Illinois Basin as the Cline team develops this new mine.

“With this acquisition, NRP continues its diversification in the Illinois Basin. When this mine is completed and in production, our Illinois Basin production is expected to be approximately 20 million tons per year, up from less than 3 million tons in 2006.”