##### 



Natural Resource Partners L.P.
Reports Third Quarter 2007 Results
 Third Quarter Highlights:
 
    
    Distributable cash flow of $34.0 million, up 10% over 3Q06
 
    
    Record revenues of $56.4 million, up 36%
 
    
    Net income attributable to limited partners of $22.9 million, up 7%
 
    
    Net income per unit decreases 17% to $0.35
 
    
    Distribution increases for seventeenth consecutive quarter to $0.475 per unit
 
    
    Guidance reaffirmed for 2007
 HOUSTON, November 1, 2007 Natural Resource Partners L.P. (NYSE:NRP and NYSE:NSP)
 Highlights3Q07
    
    
    2Q07
    
    
    3Q06(in thousands except per ton and per unit)Coal Production:
    
    
    14,708
    
    
    
    13,573
    
    
    
    12,798Coal Royalty Revenues:
    
    $
    44,378
    
    
    $
    40,733
    
    
    $
    36,902Average coal royalty revenue per ton:
    
    $
    3.02
    
    
    $
    3.00
    
    
    $
    2.88Total revenues:
    
    $
    56,366
    
    
    $
    51,097
    
    
    $
    41,491Net income to limited partners:
    
    $
    22,902
    
    
    $
    18,145
    
    
    $
    21,483Average units outstanding in quarter:
    
    
    64,891
    
    
    
    64,886
    
    
    
    50,681Net income per unit:
    
    $
    0.35
    
    
    $
    0.28
    
    
    $
    0.42Distributable cash flow:
    
    $
    34,045
    
    
    $
    43,511
    
    
    $
    31,034




---



##### 



NRP Reports 3rd Quarter 2007 Results
    
    Page 2 of 10
  Third Quarter and Nine Month Results
 Revenues  Third Quarter
  Nine Months
  Expenses  Third Quarter
   Nine Months




---



##### 



NRP Reports 3rd Quarter 2007 Results
    
    Page 3 of 10
   Net Income  Third quarter
  Nine months
  Distributable Cash Flow  Third quarter
  Nine months
  Update on Acquired Properties and Outlook




---



##### 



NRP Reports 3rd Quarter 2007 Results
    
    Page 4 of 10
   Current Market
  Distributions
  Capital Structure
  Company Profile




---



##### 



NRP Reports 3rd Quarter 2007 Results
    
    Page 5 of 10
  khager@nrplp.com http://www.nrplp.com
 Disclosure of Non-GAAP Financial Measures
 Distributable cash flow represents cash flow from operations less actual principal payments and
cash reserves set aside for scheduled principal payments on the senior notes. Distributable cash
flow is a non-GAAP financial measure that is presented because management believes it is a useful
adjunct to net cash provided by operating activities under GAAP. Distributable cash flow is a
significant liquidity metric that is an indicator of NRPs ability to generate cash flows at a
level that can sustain or support an increase in quarterly cash distributions paid to its partners.
Distributable cash flow is also the quantitative standard used throughout the investment community
with respect to publicly traded partnerships. Distributable cash flow is not a measure of financial
performance under GAAP and should not be considered as an alternative to cash flows from operating,
investing or financing activities. A reconciliation of distributable cash flow to net cash provided
by operating activities is included in the tables attached to this release. Distributable cash
flow may not be calculated the same for NRP as other companies.
 Forward-Looking Statements
 This press release may include forward-looking statements as defined by the Securities and
Exchange Commission. Such statements include the 2007 outlook and current coal market conditions.
All statements, other than statements of historical facts, included in this press release that
address activities, events or developments that the partnership expects, believes or anticipates
will or may occur in the future are forward-looking statements. These statements are based on
certain assumptions made by the partnership based on its experience and perception of historical
trends, current conditions, expected future developments and other factors it believes are
appropriate in the circumstances. Such statements are subject to a number of assumptions, risks
and uncertainties, many of which are beyond the control of the partnership. These risks include,
but are not limited to, decreases in demand for coal; changes in operating conditions and costs;
production cuts by our lessees; commodity prices; unanticipated geologic problems; changes in the
legislative or regulatory environment and other factors detailed in Natural Resource Partners
Securities and Exchange Commission filings. Natural Resource Partners L.P. has no obligation to
publicly update or revise any forward-looking statement, whether as a result of new information,
future events or otherwise.
 07-22
    
    -Financial statements follow-




---



##### 



NRP Reports 3rd Quarter 2007 Results
    
    Page 6 of 10
 Natural Resource Partners L.P.
Operating Statistics
(In thousands except per ton data)
(Unaudited)
 Three Months Ended
    
    
    For the Nine Months EndedSeptember 30,
    
    
    September 30,2007
    
    
    2006
    
    
    2007
    
    
    2006Coal Royalties:Coal royalty revenues:AppalachiaNorthern
    
    $
    3,941
    
    
    $
    2,292
    
    
    $
    11,064
    
    
    $
    8,330Central
    
    
    29,662
    
    
    
    24,568
    
    
    
    88,248
    
    
    
    74,953Southern
    
    
    4,649
    
    
    
    5,471
    
    
    
    13,677
    
    
    
    16,088Total Appalachia
    
    $
    38,252
    
    
    $
    32,331
    
    
    $
    112,989
    
    
    $
    99,371Illinois Basin
    
    
    2,462
    
    
    
    808
    
    
    
    4,941
    
    
    
    4,465Northern Powder River
    
    
    3,664
    
    
    
    3,763
    
    
    
    8,154
    
    
    
    8,703BasinTotal
    
    $
    44,378
    
    
    $
    36,902
    
    
    $
    126,084
    
    
    $
    112,539Coal royalty production (tons):AppalachiaNorthern
    
    
    1,640
    
    
    
    1,177
    
    
    
    4,875
    
    
    
    4,391Central
    
    
    8,927
    
    
    
    7,873
    
    
    
    27,022
    
    
    
    24,050Southern
    
    
    1,184
    
    
    
    1,395
    
    
    
    3,514
    
    
    
    4,256Total Appalachia
    
    
    11,751
    
    
    
    10,445
    
    
    
    35,411
    
    
    
    32,697Illinois Basin
    
    
    1,147
    
    
    
    368
    
    
    
    2,307
    
    
    
    2,507Northern Powder River
    
    
    1,810
    
    
    
    1,985
    
    
    
    4,072
    
    
    
    4,983BasinTotal
    
    
    14,708
    
    
    
    12,798
    
    
    
    41,790
    
    
    
    40,187Average royalty revenue per ton:AppalachiaNorthern
    
    $
    2.40
    
    
    $
    1.95
    
    
    $
    2.27
    
    
    $
    1.90Central
    
    
    3.32
    
    
    
    3.12
    
    
    
    3.27
    
    
    
    3.12Southern
    
    
    3.93
    
    
    
    3.92
    
    
    
    3.89
    
    
    
    3.78Total Appalachia
    
    
    3.26
    
    
    
    3.10
    
    
    
    3.19
    
    
    
    3.04Illinois Basin
    
    
    2.15
    
    
    
    2.20
    
    
    
    2.14
    
    
    
    1.78Northern Powder River Basin
    
    
    2.02
    
    
    
    1.90
    
    
    
    2.00
    
    
    
    1.75Combined average royalty
revenue per ton
    
    $
    3.02
    
    
    $
    2.88
    
    
    $
    3.02
    
    
    $
    2.80Aggregates:Royalty revenues
    
    $
    2,096
    
    
    
    
    
    
    $
    5,785
    
    
    
    Production:
    
    
    1,583
    
    
    
    
    
    
    
    4,455
    
    
    
    Average base royalty per ton:
    
    $
    1.32
    
    
    
    
    
    
    $
    1.30
    
    
    
    




---



##### 



NRP Reports 3rd Quarter 2007 Results
    
    Page 7 of 10
 Natural Resource Partners L.P.
Consolidated Statements of Income
(In thousands, except per unit data)
 Three Months Ended
    
    
    For the Nine Months EndedSeptember 30,
    
    
    September 30,2007
    
    
    2006
    
    
    2007
    
    
    2006(Unaudited)
    
    
    (Unaudited)Revenues:Coal royalties
    
    $
    44,378
    
    
    $
    36,902
    
    
    $
    126,084
    
    
    $
    112,539Aggregate royalties
    
    
    2,096
    
    
    
    
    
    
    
    5,785
    
    
    
    Coal processing fees
    
    
    1,374
    
    
    
    203
    
    
    
    3,404
    
    
    
    203Transportation fees
    
    
    1,000
    
    
    
    
    
    
    
    2,306
    
    
    
    Oil and gas royalties
    
    
    1,388
    
    
    
    853
    
    
    
    3,924
    
    
    
    3,500Property taxes
    
    
    2,963
    
    
    
    1,532
    
    
    
    7,836
    
    
    
    4,827Minimums recognized as revenue
    
    
    913
    
    
    
    633
    
    
    
    1,698
    
    
    
    1,254Override royalties
    
    
    953
    
    
    
    283
    
    
    
    2,994
    
    
    
    767Other
    
    
    1,301
    
    
    
    1,085
    
    
    
    3,639
    
    
    
    5,911Total revenues
    
    
    56,366
    
    
    
    41,491
    
    
    
    157,670
    
    
    
    129,001Operating costs and expenses:Depreciation, depletion and amortization
    
    
    13,045
    
    
    
    7,009
    
    
    
    37,324
    
    
    
    22,098General and administrative
    
    
    3,687
    
    
    
    3,475
    
    
    
    15,880
    
    
    
    11,010Property, franchise and other taxes
    
    
    3,993
    
    
    
    2,142
    
    
    
    10,618
    
    
    
    6,486Transportation costs
    
    
    79
    
    
    
    
    
    
    
    149
    
    
    
    Coal royalty and override payments
    
    
    246
    
    
    
    296
    
    
    
    914
    
    
    
    1,250Total operating costs and expenses
    
    
    21,050
    
    
    
    12,922
    
    
    
    64,885
    
    
    
    40,844Income from operations
    
    
    35,316
    
    
    
    28,569
    
    
    
    92,785
    
    
    
    88,157Other income (expense)Interest expense
    
    
    (7,124
    )
    
    
    (3,960
    )
    
    
    (21,584
    )
    
    
    (11,253
    )Interest income
    
    
    736
    
    
    
    665
    
    
    
    2,239
    
    
    
    1,938Net income
    
    $
    28,928
    
    
    $
    25,274
    
    
    $
    73,440
    
    
    $
    78,842Net income attributable to:(1)General partner
    
    $
    4,119
    
    
    $
    2,641
    
    
    $
    10,012
    
    
    $
    6,989Holders of incentive distribution rights
    
    $
    1,907
    
    
    $
    1,150
    
    
    $
    4,602
    
    
    $
    2,914Limited partners
    
    $
    22,902
    
    
    $
    21,483
    
    
    $
    58,826
    
    
    $
    68,939Basic and diluted net income per limited
partner unit:Common
    
    $
    0.35
    
    
    $
    0.42
    
    
    $
    0.91
    
    
    $
    1.36Subordinated
    
    $
    0.35
    
    
    $
    0.42
    
    
    $
    0.91
    
    
    $
    1.36Weighted average number of units outstanding:Common
    
    
    53,537
    
    
    
    33,651
    
    
    
    53,009
    
    
    
    33,651Subordinated
    
    
    11,354
    
    
    
    17,030
    
    
    
    11,354
    
    
    
    17,030
 
 (1)
    
    Net income is allocated among the limited partners, the general partner
and holders of the incentive distribution rights (IDRs) based upon their pro rata
share of distributions. The IDRs are allocated 65% to the general partner and the
remaining 35% to affiliates of the general partner. The IDRs allocated to the
general partner are included in the net income attributable to the general partner.




---



##### 



NRP Reports 3rd Quarter 2007 Results
    
    Page 8 of 10
 Natural Resource Partners L.P.
Statements of Cash Flows
(In thousands)
 Three Months Ended
    
    
    For the Nine Months EndedSeptember 30,
    
    
    September 30,2007
    
    
    2006
    
    
    2007
    
    
    2006(Unaudited)
    
    
    (Unaudited)Cash flows from operating activities:Net income
    
    $
    28,928
    
    
    $
    25,274
    
    
    $
    73,440
    
    
    $
    78,842Adjustments to reconcile net income to net
cash provided by operating activities:Depreciation, depletion and amortization
    
    
    13,045
    
    
    
    7,009
    
    
    
    37,324
    
    
    
    22,098Non-cash interest charge
    
    
    117
    
    
    
    97
    
    
    
    326
    
    
    
    288Gain from sale of assets
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,634
    )Change in operating assets and liabilities:Accounts receivable
    
    
    (4,835
    )
    
    
    (2,332
    )
    
    
    (7,634
    )
    
    
    (2,439
    )Other assets
    
    
    326
    
    
    
    282
    
    
    
    883
    
    
    
    525Accounts payable and accrued liabilities
    
    
    77
    
    
    
    255
    
    
    
    (217
    )
    
    
    235Accrued interest
    
    
    (2,763
    )
    
    
    1,020
    
    
    
    (166
    )
    
    
    2,237Deferred revenue
    
    
    2,890
    
    
    
    625
    
    
    
    10,807
    
    
    
    1,033Accrued incentive plan expenses
    
    
    495
    
    
    
    996
    
    
    
    (138
    )
    
    
    2,506Property, franchise and other taxes payable
    
    
    45
    
    
    
    158
    
    
    
    304
    
    
    
    (147
    )Net cash provided by operating activities
    
    
    38,325
    
    
    
    33,384
    
    
    
    114,929
    
    
    
    102,544Cash flows from investing activities:Acquisition of land, plant and equipment, coal and
other mineral rights
    
    
    (7,435
    )
    
    
    (54,401
    )
    
    
    (40,068
    )
    
    
    (105,839
    )Proceeds from sale of timber assets
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,761Cash placed in restricted accounts
    
    
    74
    
    
    
    
    
    
    
    (6,240
    )
    
    
    Net cash used in investing activities
    
    
    (7,361
    )
    
    
    (54,401
    )
    
    
    (46,308
    )
    
    
    (101,078
    )Cash flows from financing activities:Proceeds from loans
    
    
    7,000
    
    
    
    53,000
    
    
    
    262,400
    
    
    
    103,000Deferred financing costs
    
    
    (6
    )
    
    
    
    
    
    
    (1,292
    )
    
    
    Repayments of loans
    
    
    (400
    )
    
    
    
    
    
    
    (235,942
    )
    
    
    (24,350
    )Distributions to partners
    
    
    (37,635
    )
    
    
    (23,819
    )
    
    
    (108,099
    )
    
    
    (67,023
    )Contribution by general partner
    
    
    
    
    
    
    
    
    
    
    2,645
    
    
    
    Net cash used in financing activities
    
    
    (31,041
    )
    
    
    29,181
    
    
    
    (80,288
    )
    
    
    11,627Net (decrease) or increase in cash and cash equivalents
    
    
    (77
    )
    
    
    8,164
    
    
    
    (11,667
    )
    
    
    13,093Cash and cash equivalents at beginning of period
    
    
    54,454
    
    
    
    52,620
    
    
    
    66,044
    
    
    
    47,691Cash and cash equivalents at end of period
    
    $
    54,377
    
    
    $
    60,784
    
    
    $
    54,377
    
    
    $
    60,784SUPPLEMENTAL INFORMATION:Cash paid during the period for interest
    
    $
    9,752
    
    
    $
    2,841
    
    
    $
    21,379
    
    
    $
    8,702Non-cash investing activities:Units issued for assets and liabilities
    
    $
    
    
    
    $
    
    
    
    $
    350,741
    
    
    $
    Liability assumed in business combination
    
    
    39
    
    
    
    
    
    
    
    1,989
    
    
    
    




---



##### 



NRP Reports 3rd Quarter 2007 Results
    
    Page 9 of 10
 Natural Resource Partners L.P.
Consolidated Balance Sheets
(In thousands)
 ASSETS
 September 30,
    
    
    December 31,2007
    
    
    2006(Unaudited)Current assets:Cash and cash equivalents
    
    $
    54,377
    
    
    $
    66,044Restricted cash
    
    
    6,240
    
    
    
    Accounts receivable, net of allowance for doubtful accounts
    
    
    30,003
    
    
    
    23,357Accounts receivable  affiliate
    
    
    1,009
    
    
    
    21Other
    
    
    237
    
    
    
    1,411Total current assets
    
    
    91,866
    
    
    
    90,833Land
    
    
    24,532
    
    
    
    17,781Plant and equipment, net
    
    
    61,650
    
    
    
    29,615Coal and other mineral rights, net
    
    
    1,004,081
    
    
    
    798,135Intangible assets
    
    
    111,179
    
    
    
    Loan financing costs, net
    
    
    3,202
    
    
    
    2,197Other assets, net
    
    
    825
    
    
    
    932Total assets
    
    $
    1,297,335
    
    
    $
    939,493LIABILITIES AND PARTNERS CAPITALCurrent liabilities:Accounts payable
    
    $
    2,550
    
    
    $
    1,041Accounts payable  affiliate
    
    
    368
    
    
    
    105Current portion of long-term debt
    
    
    17,234
    
    
    
    9,542Accrued incentive plan expenses  current portion
    
    
    4,260
    
    
    
    5,418Property, franchise and other taxes payable
    
    
    4,634
    
    
    
    4,330Accrued interest
    
    
    3,680
    
    
    
    3,846Total current liabilities
    
    
    32,726
    
    
    
    24,282Deferred revenue
    
    
    31,461
    
    
    
    20,654Asset retirement obligation
    
    
    39
    
    
    
    Accrued incentive plan expenses
    
    
    5,599
    
    
    
    4,579Long-term debt
    
    
    473,057
    
    
    
    454,291Partners capital:Common units
    
    
    661,094
    
    
    
    338,912Subordinated units
    
    
    78,701
    
    
    
    83,772General partners interest
    
    
    15,418
    
    
    
    12,138Holders of incentive distribution rights
    
    
    (48
    )
    
    
    1,616Accumulated other comprehensive loss
    
    
    (712
    )
    
    
    (751
    )Total partners capital
    
    
    754,453
    
    
    
    435,687Total liabilities and partners capital
    
    $
    1,297,335
    
    
    $
    939,493




---



##### 



NRP Reports 3rd Quarter 2007 Results
    
    Page 10 of 10
 Natural Resource Partners L.P.
Reconciliation of GAAP Net cash provided by operating activities
To Non-GAAP Distributable cash flow
(In thousands)
(Unaudited)
 Three Months Ended
    
    
    For the Nine Months EndedSeptember 30,
    
    
    September 30,2007
    
    
    2006
    
    
    2007
    
    
    2006Cash flow from operations
    
    $
    38,325
    
    
    $
    33,384
    
    
    $
    114,929
    
    
    $
    102,544Less scheduled principal payments
    
    
    
    
    
    
    
    
    
    
    (9,350
    )
    
    
    (9,350
    )Less reserves for future principal payments
    
    
    (4,280
    )
    
    
    (2,350
    )
    
    
    (9,080
    )
    
    
    (7,050
    )Add reserves used for scheduled principal payments
    
    
    
    
    
    
    
    
    
    
    9,400
    
    
    
    9,400Distributable cash flow
    
    $
    34,045
    
    
    $
    31,034
    
    
    $
    105,899
    
    
    $
    95,544
 -end-