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CNX Resources Corp – ‘10-K’ for 12/31/13 – ‘EX-99’

On: Friday, 2/7/14, at 2:47pm ET · For: 12/31/13 · Accession #: 1070412-14-5 · File #: 1-14901

  As Of               Filer                 Filing    For·On·As Docs:Size

 2/07/14  CNX Resources Corp                10-K       12/31/13  159:48M

Annual Report — Form 10-K — Sect. 13 / 15(d) – SEA’34
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 10-K        Annual Report                                       HTML   3.21M 
 2: EX-10.69    Summary of Non-Employee Director Compensation       HTML     44K 
 4: EX-21       Subsidiaries of Consol Energy Inc.                  HTML     50K 
 5: EX-23.1     Consent of Ernst & Young LLP                        HTML     40K 
 6: EX-23.2     Consent of Nertherland Sewell & Associates, Inc.    HTML     42K 
13: EX-95       Mine Safety Disclosure Exhibit                      HTML    206K 
12: EX-99       Engineers Audit Letter                              HTML     88K 
 3: EX-12       Computation of Ratio of Earnings to Fixed Charges   HTML     58K 
 7: EX-31.1     Certification of Chief Executive Officer Pursuant   HTML     47K 
                to Section 302                                                   
 8: EX-31.2     Certification of Chief Financial Officer Pursuant   HTML     47K 
                to Section 302                                                   
 9: EX-32.1     Certification of Chief Executive Officer Pursuant   HTML     42K 
                to 18 U.S.C. Section 1350                                        
11: EX-32.2     Certification of Chief Financial Officer Pursuant   HTML     42K 
                to 18 U.S.C. Section 1350                                        
107: R1          Document and Entity Information                     HTML     68K  
79: R2          Consolidated Statements of Income                   HTML    149K 
99: R3          Consolidated Statement of Comprehensive Income      HTML     69K 
112: R4          Consolidated Statement of Comprehensive Income      HTML     42K  
                Parentheticals                                                   
144: R5          Consolidated Balance Sheets                         HTML    231K  
84: R6          Consolidated Balance Sheets Parentheticals          HTML     61K 
98: R7          Consolidated Statements of Stockholders' Equity     HTML     98K 
72: R8          Consolidated Statements of Cash Flows               HTML    164K 
58: R9          Discontinued Operations (Notes)                     HTML     91K 
146: R10         Acquisitions and Dispositions                       HTML     60K  
114: R11         Other Income                                        HTML     63K  
113: R12         Interest Expense                                    HTML     56K  
121: R13         Taxes Other Than Income                             HTML     60K  
122: R14         Income Taxes                                        HTML    177K  
118: R15         Inventories                                         HTML     52K  
124: R16         Accounts Receivable Securitization                  HTML     51K  
100: R17         Property, Plant and Equipment                       HTML    116K  
109: R18         Short-Term Notes Payable                            HTML     53K  
116: R19         Other Accrued Liabilities                           HTML     70K  
158: R20         Long-Term Debt                                      HTML     64K  
135: R21         Leases                                              HTML    100K  
91: R22         Pension and OPEB                                    HTML    461K 
115: R23         CWP and Workers Comp                                HTML    207K  
95: R24         Other Employee Benefits                             HTML     64K 
47: R25         Stock Based Compensation                            HTML    146K 
137: R26         Supplemental Cash Flow                              HTML     54K  
151: R27         Concentrations of Credit Risk                       HTML     59K  
66: R28         Fair Value of Financial Instruments                 HTML     82K 
65: R29         Derivatives                                         HTML     74K 
70: R30         Commitments and Contingencies                       HTML    139K 
71: R31         Segment Information                                 HTML    449K 
73: R32         Guarantor Subsidiaries Financial Information        HTML   1.15M 
31: R33         Related Party                                       HTML     60K 
133: R34         Supplemental Coal Data (Unaudited)                  HTML     75K  
88: R35         Supplemental Gas Data                               HTML    268K 
92: R36         Supplemental Quarterly Info (Unaudited)             HTML    158K 
52: R37         Significant Accounting Policy (Policies)            HTML    322K 
157: R38         Mine Closing, Reclamation, and Gas Well Closing     HTML     63K  
                ARO Accounting Policy (Policies)                                 
19: R39         Property, Plant and Equipment PP&E Accounting       HTML     56K 
                Policy (Policies)                                                
76: R40         Derivatives Derivatives Policy (Policies)           HTML     43K 
142: R41         Significant Accounting Policy (Tables)              HTML    110K  
49: R42         Discontinued Operations (Tables)                    HTML     87K 
64: R43         Acquisitions and Dispositions (Tables)              HTML     42K 
69: R44         Other Income (Tables)                               HTML     63K 
80: R45         Interest Expense (Tables)                           HTML     54K 
30: R46         Taxes Other Than Income (Tables)                    HTML     60K 
57: R47         Mine Closing, Reclamation, and Gas Well Closing     HTML     54K 
                (Tables)                                                         
22: R48         Inventories (Tables)                                HTML     49K 
140: R49         Property, Plant and Equipment (Tables)              HTML     97K  
48: R50         Other Accrued Liabilities (Tables)                  HTML     69K 
134: R51         Long-Term Debt (Tables)                             HTML     69K  
53: R52         Leases (Tables)                                     HTML     96K 
77: R53         Pension and OPEB (Tables)                           HTML    427K 
21: R54         CWP and Workers Comp (Tables)                       HTML    263K 
27: R55         Other Employee Benefits (Tables)                    HTML     96K 
68: R56         Stock Based Compensation (Tables)                   HTML    123K 
38: R57         Supplemental Cash Flow (Tables)                     HTML     49K 
147: R58         Fair Value of Financial Instruments (Tables)        HTML     79K  
86: R59         Derivatives (Tables)                                HTML     56K 
119: R60         Commitments and Contingencies (Tables)              HTML    118K  
56: R61         Segment Information (Tables)                        HTML    450K 
60: R62         Guarantor Subsidiaries Financial Information        HTML   1.03M 
                (Tables)                                                         
130: R63         Related Party (Tables)                              HTML     54K  
125: R64         Supplemental Coal Data (Unaudited) (Tables)         HTML     73K  
90: R65         Supplemental Gas Data (Tables)                      HTML    331K 
128: R66         Supplemental Quarterly Info (Unaudited) (Tables)    HTML    158K  
54: R67         Significant Accounting Policy Anit-Dilutive         HTML     48K 
                Securities (Details)                                             
96: R68         Significant Accounting Policy Earnings Per Share    HTML     94K 
                (Details)                                                        
150: R69         Significant Accounting Policy Common Stock          HTML     46K  
                Rollforward (Details)                                            
25: R70         Significant Accounting Policy Other (Details)       HTML     41K 
46: R71         Significant Accounting Policy Other Comprehensive   HTML     62K 
                Income (Details)                                                 
78: R72         Significant Accounting Policy Accumulated Other     HTML     92K 
                Comprehensive Income (Details)                                   
36: R73         Discontinued Operations (Details)                   HTML     47K 
156: R74         Discontinued Operations Income (Loss) from          HTML     56K  
                Discontinued Operations (Details)                                
50: R75         Discontinued Operations Balance Sheet (Details)     HTML     80K 
41: R76         Acquisitions (Details)                              HTML     68K 
45: R77         Dispositions (Details)                              HTML     85K 
28: R78         Other Income (Details)                              HTML     60K 
32: R79         Interest Expense (Details)                          HTML     52K 
110: R80         Taxes Other Than Income (Details)                   HTML     43K  
43: R81         Income Taxes Income Tax Components (Details)        HTML     53K 
148: R82         Income Taxes Effective Tax Rate Reconciliation      HTML    112K  
                (Details)                                                        
74: R83         Income Taxes Income Taxes (Details)                 HTML     77K 
117: R84         Income Taxes Net Deferred Tax assets/Liabilities    HTML    104K  
                (Details)                                                        
127: R85         Income Taxes Unrecognized tax benefits (Details)    HTML     59K  
42: R86         Mine Closing, Reclamation, and Gas Well Closing     HTML     51K 
                (Details)                                                        
44: R87         Inventory Components (Details)                      HTML     52K 
145: R88         Accounts Receivable Securitization (Details)        HTML     62K  
37: R89         Property, Plant and Equipment PROPERTY PLANT AND    HTML     91K 
                EQUIPMENT (Details)                                              
111: R90         Property, Plant and Equipment Assets Amortized by   HTML     62K  
                Units of Production (Details)                                    
103: R91         Property, Plant and Equipment Capital Leases        HTML     47K  
                (Details)                                                        
131: R92         Property, Plant and Equipment Joint Participation   HTML     71K  
                Agreements (Details)                                             
102: R93         Short-Term Notes Payable (Details)                  HTML     65K  
85: R94         Other Accrued Liabilities (Details)                 HTML     81K 
138: R95         Long-Term Debt (Details)                            HTML     67K  
81: R96         Long-Term Debt Debt Maturity Schedule (Details)     HTML     56K 
51: R97         Leases Operating Leases (Details)                   HTML     70K 
93: R98         Leases Capital Leases (Details)                     HTML     69K 
87: R99         Pension and OPEB Pension and OPEB Liability         HTML    251K 
                Disclosures (Details)                                            
67: R100        Pension and OPEB Pension Plan Assets Fair Value     HTML    150K 
                (Details)                                                        
159: R101        CWP and Workers Comp (Details)                      HTML    173K  
129: R102        Other Employee Benefits Long-Term Disability        HTML     57K  
                (Details)                                                        
101: R103        Other Employee Benefits MultiEmployer Plans         HTML     60K  
                (Details)                                                        
29: R104        Stock Based Compensation (Details)                  HTML     65K 
141: R105        Stock Based Compensation Weighted Average Fair      HTML     68K  
                Value of Grants (Details)                                        
149: R106        Stock Based Compensation Stock Option Rollforward   HTML    134K  
                (Details)                                                        
143: R107        Stock Based Compensation Restricted and             HTML     87K  
                Performance Stock Unit Rollforward (Details)                     
97: R108        Supplemental Cash Flow Supplemental Cash Flow       HTML     55K 
                (Details)                                                        
39: R109        Concentrations of Credit Risk (Details)             HTML     50K 
120: R110        Financial Instruments Measured at Fair Value on a   HTML     75K  
                Recurring Basis (Details)                                        
55: R111        Carrying Amounts and Fair Values of Financial       HTML     68K 
                Instruments for Which the Fair Value Option Was                  
                Not Elected (Details)                                            
20: R112        Derivatives Derivates Impact on Income (Details)    HTML     56K 
83: R113        Derivatives Derivatives by Balance Sheet Location   HTML     73K 
                (Details)                                                        
75: R114        Commitments and Contingencies Additional            HTML     49K 
                Information (Details)                                            
136: R115        Maximum Potential Total of Future Payments Under    HTML     92K  
                Commitment Instruments (Details)                                 
59: R116        Unrecorded Unconditional Purchase Obligation        HTML     50K 
                (Details)                                                        
153: R117        Costs Related to Purchase Obligations (Details)     HTML     46K  
33: R118        Segment Information Industry Segment Results        HTML    169K 
                (Details)                                                        
106: R119        Reconciliation of Segment Information, Revenue and  HTML     77K  
                Other Income (Details)                                           
126: R120        Reconciliation of Segment Information, Total        HTML     72K  
                Assets (Details)                                                 
23: R121        Guarantor Subsidiaries Financial Information        HTML     46K 
                Additional Information (Details)                                 
104: R122        Guarantor Subsidiaries Income Statement (Details)   HTML    228K  
94: R123        Guarantor Subsidiaries Balance Sheet (Detail)       HTML    348K 
26: R124        Guarantor Subsidiaries, Condensed Statement of      HTML    153K 
                Cash Flows (Detail)                                              
108: R125        Guarantor Subsidiaries Financial Information        HTML     94K  
                Guarantor Subsidiaries Comprehensive Income                      
                Statement (Details)                                              
155: R126        Related Party (Details)                             HTML     53K  
34: R127        Supplemental Coal Data (Unaudited) (Details)        HTML     63K 
61: R128        Supplemental Gas Data Capitalized Costs (Details)   HTML     63K 
132: R129        Supplemental Gas Data Oil and Gas Expenditures      HTML     52K  
                (Details)                                                        
154: R130        Supplemental Gas Data Results of Operations         HTML     80K  
                (Details)                                                        
89: R131        Supplemental Gas Data Average Unit Prices           HTML     53K 
                (Details)                                                        
105: R132        Supplemental Gas Data Acreages (Details)            HTML     57K  
35: R133        Supplemental Gas Data Oil and Gas Reserve           HTML     88K 
                Quantities (Details)                                             
40: R134        Supplemental Gas Data Exploratary Wells (Details)   HTML     53K 
82: R135        Supplemental Gas Data PV-10 (Details)               HTML     60K 
63: R136        Supplemental Gas Data PV-10 Reconciliation          HTML     90K 
                (Details)                                                        
123: R137        Supplemental Quarterly Info (Unaudited) (Details)   HTML    100K  
152: XML         IDEA XML File -- Filing Summary                      XML    243K  
24: EXCEL       IDEA Workbook of Financial Reports                  XLSX    901K 
62: EXCEL       IDEA Workbook of Financial Reports (.xls)            XLS   8.47M 
17: EX-101.INS  XBRL Instance -- cnx-20131231                        XML  11.74M 
10: EX-101.CAL  XBRL Calculations -- cnx-20131231_cal                XML    365K 
15: EX-101.DEF  XBRL Definitions -- cnx-20131231_def                 XML   1.87M 
18: EX-101.LAB  XBRL Labels -- cnx-20131231_lab                      XML   3.54M 
16: EX-101.PRE  XBRL Presentations -- cnx-20131231_pre               XML   2.46M 
14: EX-101.SCH  XBRL Schema -- cnx-20131231                          XSD    376K 
139: ZIP         XBRL Zipped Folder -- 0001070412-14-000005-xbrl      Zip    719K

‘EX-99’ — Engineers Audit Letter

This Exhibit is an HTML Document rendered as filed. [ Alternative Formats ]

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Ex. 99 Engineers' Audit Letter 12-31-13

Exhibit 99

February 5, 2014

Mr. Chris Miller

CONSOL Energy Inc.

1000 CONSOL Energy Drive

Canonsburg, Pennsylvania 15317

Dear Mr. Miller:

In accordance with your request, we have audited the estimates prepared by CONSOL Energy Inc. (CONSOL), as of December 31, 2013, of the proved reserves and future revenue to the CONSOL interest in certain oil and gas properties located in the United States. It is our understanding that the proved reserves estimated herein constitute all of the proved reserves owned by CONSOL. We have examined the estimates with respect to reserves quantities, reserves categorization, future producing rates, future net revenue, and the present value of such future net revenue, using the definitions set forth in U.S. Securities and Exchange Commission (SEC) Regulation S-X Rule 4-10(a). The estimates of reserves and future revenue have been prepared in accordance with the definitions and regulations of the SEC and, with the exception of the exclusion of future income taxes, conform to the FASB Accounting Standards Codification Topic 932, Extractive Activities–Oil and Gas. We completed our audit on or about the date of this letter. This report has been prepared for CONSOL's use in filing with the SEC; in our opinion the assumptions, data, methods, and procedures used in the preparation of this report are appropriate for such purpose.

The following table sets forth CONSOL's estimates of the net reserves and future net revenue, as of December 31, 2013, for the audited properties:



	Net Reserves			Future Net Revenue (M$)
	Oil	NGL	Gas		Present Worth
Category	(MBBL)	(MBBL)	(MMCF)	Total	at 10%
Proved Developed Producing	1,320.444	4,774.494	2,316,099.000	4,774,610.352	2,112,931.219
Proved Developed Non-Producing	54.407	1,164.379	154,312.984	433,154.688	150,869.703
Proved Undeveloped⁽¹⁾	1,430.883	15,606.579	3,114,694.750	5,385,994.000	516,093.094
Total Proved	2,805.734	21,545.469	5,585,107.000	10,593,759.000	2,779,893.750

Totals may not add because of rounding.

⁽¹⁾These reserves have been included based on the operators' declared intent to drill these wells.

The oil volumes shown include crude oil and condensate. Oil and natural gas liquids (NGL) volumes are expressed in thousands of barrels (MBBL); a barrel is equivalent to 42 Unites States gallons. Gas volumes are expressed in millions of cubic feet (MMCF) at standard temperature and pressure bases. The table following this letter sets forth CONSOL's estimates of net reserves and future revenue by reserves category.

When compared on an area-by-area basis, some of the estimates of CONSOL are greater and some are less than the estimates of Netherland, Sewell & Associates, Inc. (NSAI). However, in our opinion the estimates of CONSOL's proved reserves and future revenue shown herein are, in the aggregate, reasonable and have been prepared in accordance with the Standards Pertaining to the Estimating and Auditing of Oil and Gas Reserves Information promulgated by the Society of Petroleum Engineers (SPE Standards). Additionally, these estimates are within the recommended 10 percent tolerance threshold set forth in the SPE Standards. We are satisfied with the methods and procedures used by CONSOL in preparing the December 31, 2013, estimates of reserves and future revenue, and we saw nothing of an unusual nature that would cause us to take exception with the estimates, in the aggregate, as prepared by CONSOL.

The estimates shown herein are for proved reserves. CONSOL's estimates do not include probable or possible reserves that may exist for these properties, nor do they include any value for undeveloped acreage beyond those tracts for which undeveloped reserves have been estimated. CONSOL has included estimates of proved undeveloped reserves for certain locations that generate positive future net revenue but have negative present worth discounted at 10 percent based on the constant prices and costs discussed in subsequent paragraphs of this letter. These locations have been included based on the operators' declared intent to drill these wells, as evidenced by CONSOL's internal budget, reserves estimates, and price

forecast. Reserves categorization conveys the relative degree of certainty; reserves subcategorization is based on development and production status. The estimates of reserves and future revenue included herein have not been adjusted for risk.

Prices used by CONSOL are based on the 12-month unweighted arithmetic average of the first-day-of-the-month price for each month in the period January through December 2013. For oil and NGL volumes, the average West Texas Intermediate spot price of $96.91 per barrel is adjusted for quality, transportation fees, and regional price differentials. For gas volumes, the average Henry Hub spot price of $3.670 per MMBTU is adjusted for energy content, transportation fees, and regional price differentials. All prices are held constant throughout the lives of the properties. The average adjusted product prices weighted by production over the remaining lives of the properties are $81.81 per barrel of oil, $53.03 per barrel of NGL, and $3.62 per MCF of gas.

Operating costs used by CONSOL are based on historical operating expense records. These costs include the per-well overhead expenses allowed under joint operating agreements along with estimates of costs to be incurred at and below the district and field levels. Operating costs have been divided into per-well costs and per-unit-of-production costs. Headquarters general and administrative overhead expenses of CONSOL are included to the extent that they are covered under joint operating agreements for the operated properties. Capital costs used by CONSOL are based on authorizations for expenditure and actual costs from recent activity. Capital Capital costs are included as required for workovers, new development wells, and production equipment. Abandonment costs used are CONSOL's estimates of the costs to abandon the wells and production facilities; these estimates do not include any salvage value for the lease and well equipment. Operating, capital, and abandonment costs are not escalated for inflation.

The reserves shown in this report are estimates only and should not be construed as exact quantities. Proved reserves are those quantities of oil and gas which, by analysis of engineering and geoscience data, can be estimated with reasonable certainty to be economically producible; probable and possible reserves are those additional reserves which are suquentially less certain to be recovered than proved reserves. Estimates of reserves may increase or decrease as a result of market conditions, future operations, changes in regulations, or actual reservoir performance. In addition to the primary economic assumptions discussed herein, estimates of CONSOL and NSAI are based on certain assumptions including, but not limited to, that the properties will be developed consistent with current development plans, that the properties will be operated in a prudent manner, that no governmental regulations or controls will be put in place that would impact the ability of the interest owner to recover the reserves, and that projections of future production will prove consistent with actual performance. If the reserves are recovered, the revenues therefrom and the costs related thereto could be more or less than the estimated amounts. Because of governmental policies and uncertainties of supply and demand, the sales rates, prices received for the reserves, and costs incurred in recovering such reserves may vary from assumptions made while preparing these estimates.

It should be understood that our audit does not constitute a complete reserves study of the audited oil and gas properties. Our audit consisted primarily of substantive testing, wherein we conducted a detailed review of all properties. In the conduct of our audit, we have not independently verified the accuracy and completeness of information and data furnished by CONSOL with respect to ownership interests, oil and gas production, well test data, historical costs of operation and development, product prices, or any agreements relating to current and future operations of the properties and sales of production. However, if in the course of our examination something came to our attention that brought into question the validity or sufficiency of any such information or data, we did not rely on such information or data until we had satisfactorily resolved our questions relating thereto or had independently verified such information or data. Our audit did not include a review of CONSOL's overall reserves management processes and practices.

We used standard engineering and geoscience methods, or a combination of methods, including performance analysis, volumetric analysis, and analogy, that we considered to be appropriate and necessary to establish the conclusions set forth herein. As in all aspects of oil and gas evaluation, there are uncertainties inherent in the interpretation of engineering and geoscience data; therefore, our conclusions necessarily represent only informed professional judgment.

Supporting data documenting this audit, along with data provided by CONSOL, are on file in our office. The technical persons responsible for conducting this audit meet the requirements regarding qualifications, independence, objectivity, and confidentiality set forth in the SPE Standards. We are independent petroleum engineers, geologists, geophysicists; we do not own an interest in these properties nor are we employed on a contingent basis.

Sincerely,



		NETHERLAND, SEWELL & ASSOCIATES, INC.
		Texas Registered Engineering Firm F-2699

		By:	/s/ *C.H. (Scott) Rees III*
			C.H. (Scott) Rees III, P.E.
			Chairman and Chief Executive Officer

By:	/s/ *Richard B. Talley, Jr.*	By:	/s/ *David E. Nice*
	Richard B. Talley, Jr., P.E. 102425		David E. Nice, P.G. 346
	Vice President		Vice President

Date Signed: February 5, 2014		Date Signed: February 5, 2014

RBT:DEG



SUMMARY OF NET RESERVES AND FUTURE REVENUE
CONSOL ENERGY INC. INTEREST
AS OF DECEMBER 31, 2013

							Investment
	Net Reserves			Future	Operating		Including	Future Net Revenue (M$)
	Oil	NGL	Gas	Gross Revenue	Expense	Taxes	Abandonment		Discounted
Category	(MBBL)	(MBBL)	(MMCF)	(M$)	(M$)	(M$)	(M$)	Total	At 10%
Proved Developed Producing	1,320.444	4,774.494	2,316,099.000	8,491,987.000	3,222,514.750	310,286.031	268,105.688	4,691,081.000	2,026,466.500
Other Revenue and Costs ⁽¹⁾	—	—	—	141,340.750	57,811.406	—	—	83,529.352	86,464.719
Total Proved Developed Producing	1,320.444	4,774.494	2,316,099.000	8,633,327.750	3,280,326.156	310,286.031	268,105.688	4,774,610.352	2,112,931.219

Proved Developed Non-Producing	54.407	1,164.379	154,312.984	661,369.500	150,534.438	13,460.077	64,220.324	433,154.688	150,869.703

Proved Undeveloped ⁽²⁾	1,430.883	15,606.597	3,114,694.750	12,307,897.000	2,794,338.750	557,016.562	3,570,547.750	5,385,994.000	516,093.094

Total Proved	2,805.734	21,545.469	5,585,107.000	21,602,594.000	6,225,199.000	880,762.688	3,902,873.500	10,593,759.000	2,779,893.750

Totals may not add because of rounding.

⁽¹⁾ Other revenue and costs include gas contract revenue and pipeline lease costs.

⁽²⁾These reserves have been included based on the operators' declared intent to drill these wells.

Dates Referenced Herein and Documents Incorporated by Reference

This ‘10-K’ Filing	Date	Other Filings

Filed on:	2/7/14
	2/5/14	4
For Period end:	12/31/13	11-K, ARS, SD
		List all Filings

3 Subsequent Filings that Reference this Filing

  As Of               Filer                 Filing    For·On·As Docs:Size             Issuer                      Filing Agent

 6/05/14  SEC                               UPLOAD¶     9/20/17    1:36K  CNX Resources Corp.
 5/07/14  SEC                               UPLOAD¶     9/20/17    1:139K CNX Resources Corp.
 3/25/14  SEC                               UPLOAD¶     9/20/17    1:167K CNX Resources Corp.

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Filing Submission 0001070412-14-000005 – Alternative Formats (Word / Rich Text, HTML, Plain Text, et al.)