Bruce D. DavisThank you. In the course of our remarks and the subsequent Q&A session, we may be making forward-looking statements. For purposes of facilitating a good discussion, I'll refer you to the forward-looking statements, as referenced in this morning's press release, noting that our business is subject to a variety of risks and uncertainties. For a fuller discussion of these and other risks that could cause our results to change, please refer to PVR's Form 10-K most recently filed with the SEC. William H. Shea Thanks, Bruce. It goes without saying the second quarter was difficult for PVR. And in fact, it’s in stark contrast to how we view our future prospects, especially in the midstream business going forward. As a result of the discussions that we've had in the board in the last day and a half related especially to our future expectations, the board approved a $0.01 per unit increase on the distribution to $0.53 per unit or $2.12 a unit annualized. This represents an 8.2% increase versus the second quarter of 2011. Our strategy to focus on the midstream business, particularly in the Marcellus, has and will continue to generate the returns in cash flow that we expect at PVR. I do, of course, have to comment on the quarter. As you can see from the press release, we're now managing and reporting our business along 3 business segments: Coal, Midstream Midcontinent, Midstream Eastern. This should make it a lot easier, I hope, for everyone to follow the performance of PVR. In the Coal segment, we have adjusted EBITDA of $26.7 million versus $42.3 million last year. Volume was down 2.3 million tons. And the royalty pricing per ton was about $3.76 per ton versus $4.40 per ton last year. In the current environment, volume is more important and is a more important issue versus pricing. Keith can expand on the Coal segment as you desire during the Q&A segment. But it's clear that we have experienced reduced ships, extended vacations, idling of facilities and operator contract terminations.
In the Midcon Midstream segment, adjusted EBITDA was down $4.7 million from 2011. The decrease is almost entirely NGL price related as volumes were up on average 31 million cubic feet a day from 2011. What we're finding in the Midcon area is that activity levels are still high, producers are not backing off from the drilling plans but current NGL pricing especially the S.A. [ph] and the Conway [ph] is very low.In the Eastern Midstream segment, adjusted EBITDA was up $12.5 million from 2011 to $17.2 million as a result of a Chief acquisition as well as what we're calling our legacy Lycoming County system. Volumes were 344 million cubic feet a day versus 38 million cubic feet a day last year, a substantial increase in activity. We closed the Chief acquisition on May 17, and we're very pleased with the integration of the operations and with the prospects in front of us as a result of this acquisition and the continued development of our Lycoming County system, the system that we entered the Marcellus with anchored by Range Resources. Today we're looking at 50-plus wells in both Lycoming and Wyoming County that has been drilled, completed and frac-ed waiting on us to hook them up, and we're diligently working on doing just that. As importantly, drilling activity continues to exceed our expectations in the Marcellus. And we're very, very thankful for that of course. The current gas pricing in the strip are helping for sure, and so we expect to see that drilling activity continue throughout the year. We continue to expand our system in Lycoming County, batched up by our agreements with Southwest Energy, Range and an affiliate of Shell. This project, announced after the Chief acquisition, extends both the gas and the water pipelines beyond Phase 2 and will be online in the fourth quarter of this year, at which time we will bring incremental volumes onto the system. Read the rest of this transcript for free on seekingalpha.com