CNX Resources CorpCNX
CNX Resources Corp Leases Disclosure
LEASES:
CNX's leasing activities primarily consist of operating and finance leases for electric fracturing equipment, natural gas drilling rigs, CNX's corporate headquarters as well as field offices, a natural gas gathering pipeline and commercial vehicles. Some leases include options to renew ranging from a period of 1 to 5 years, which are not recognized as part of the lease right-of-use (ROU) assets or liabilities as they are not reasonably certain to be exercised.
Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of the lease payments over the lease term. As most of CNX's leases do not provide an implicit rate, an incremental borrowing rate is used to determine the present value of lease payments. In accordance with ASC 842, it is the Company’s policy to exclude leases with a term of 12 months or less and to not separate lease components from non-lease components for any asset class.
On January 2, 2024, CNX entered into a new lease for an electric-powered drilling system that is expected to result in a finance lease asset, to be included within property, plant and equipment, and as a finance lease obligation of $18,823 in 2026, which is when the lease is expected to commence.
The components of lease cost were as follows:
| For the Years Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| Operating Lease Cost | $ | 58,694 | $ | 60,572 | $ | 63,087 | |||||||||||
| Finance Lease Cost: | |||||||||||||||||
Amortization of Right-of-Use Assets | 7,054 | 2,898 | 1,628 | ||||||||||||||
Interest on Lease Liabilities | 1,703 | 814 | 429 | ||||||||||||||
| Short-term Lease Cost | 3,950 | 1,533 | 2,357 | ||||||||||||||
| Variable Lease Cost* | — | 4,517 | 12,401 | ||||||||||||||
| Total Lease Cost | $ | 71,401 | $ | 70,334 | $ | 79,902 | |||||||||||
*Amounts recognized in the Consolidated Balance Sheets for natural gas drilling rigs are measured using the rates that would be paid if the rigs were idle, as this represents the minimum payment that could be made under the contract. Variable lease cost represents amounts paid for natural gas drilling rigs above this minimum when the rigs are in use. Amounts recognized in the Consolidated Balance Sheets for electric fracturing equipment are measured using minimum pumping hours under the contract; however, pumping hours may exceed the minimum and vary period to period. Any such amounts paid related to pumping hours in excess of the minimum represent variable lease cost. For the year ended December 31, 2025, actual utilization was below the minimum payment, resulting in no additional variable lease expense.
Amounts recognized in the Consolidated Balance Sheets are as follows:
| December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| Operating Leases: | |||||||||||
| Operating Lease Right-of-Use Assets | $ | 150,310 | $ | 98,713 | |||||||
| Current Portion of Operating Lease Obligations | $ | 48,453 | $ | 51,474 | |||||||
| Operating Lease Obligations | 104,955 | 49,519 | |||||||||
Total Operating Lease Liabilities | $ | 153,408 | $ | 100,993 | |||||||
| Finance Leases: | |||||||||||
| Property, Plant and Equipment | $ | 40,615 | $ | 31,751 | |||||||
| Less—Accumulated Depreciation, Depletion and Amortization | 11,735 | 5,539 | |||||||||
| $ | 28,880 | $ | 26,212 | ||||||||
| Current Portion of Finance Lease Obligations | $ | 5,095 | $ | 4,236 | |||||||
| Finance Lease Obligations | 24,991 | 21,040 | |||||||||
Total Finance Lease Liabilities | $ | 30,086 | $ | 25,276 | |||||||
Supplemental cash flow information related to leases was as follows:
| For the Years Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| Cash Paid for Amounts Included in the Measurement of Lease Liabilities: | |||||||||||||||||
| Operating Cash Flows for Operating Leases | $ | 58,644 | $ | 61,475 | $ | 64,139 | |||||||||||
| Operating Cash Flows for Finance Leases | $ | 1,703 | $ | 814 | $ | 429 | |||||||||||
| Financing Cash Flows for Finance Leases | $ | 4,465 | $ | 2,409 | $ | 1,627 | |||||||||||
| Right-of-Use Assets Obtained in Exchange for Lease Obligations: | |||||||||||||||||
Operating Leases | $ | 103,296 | $ | 13,996 | $ | 19,477 | |||||||||||
Finance Leases | $ | 9,568 | $ | 20,407 | $ | 6,178 | |||||||||||
Maturities of lease liabilities are as follows:
| Operating | Finance | ||||||||||
| Leases | Leases | ||||||||||
| Year Ended December 31, | |||||||||||
| 2026 | $ | 56,399 | $ | 6,874 | |||||||
| 2027 | 49,306 | 6,772 | |||||||||
| 2028 | 44,983 | 11,158 | |||||||||
| 2029 | 6,620 | 2,810 | |||||||||
| 2030 | 6,624 | 2,293 | |||||||||
| Thereafter | 7,225 | 6,271 | |||||||||
| Total Lease Payments | 171,157 | 36,178 | |||||||||
| Less: Interest | 17,749 | 6,092 | |||||||||
| Present Value of Lease Liabilities | $ | 153,408 | $ | 30,086 | |||||||
Lease terms and discount rates are as follows:
| For the Years Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| Weighted Average Remaining Lease Term (years): | |||||||||||||||||
Operating Leases | 3.63 | 3.66 | 3.59 | ||||||||||||||
Finance Leases | 4.35 | 4.35 | 4.08 | ||||||||||||||
| Weighted Average Discount Rate: | |||||||||||||||||
Operating Leases | 6.16 | % | 5.04 | % | 4.84 | % | |||||||||||
Finance Leases | 6.08 | % | 6.32 | % | 7.35 | % | |||||||||||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 10, 2026 | Showing above |
| 2024 | Feb 11, 2025 | |
About Leases Disclosures
Lease disclosures under ASC 842 provide a comprehensive view of a company's leased asset portfolio, including the split between operating and finance leases, discount rates used to present-value future payments, and the maturity schedule of lease obligations. This section reveals a significant source of off-balance-sheet commitments that were largely hidden before the current standard.
Key signals: the weighted-average discount rate affects the size of recorded lease liabilities — a higher rate reduces the reported obligation, so compare the chosen rate against the company's incremental borrowing rate. The operating versus finance lease mix affects both EBITDA and operating income presentation. Watch the maturity table for concentration risk: large payment cliffs in specific years may create cash flow pressure. Variable lease payments excluded from the liability measurement represent real obligations that do not appear on the balance sheet. Compare total lease costs against prior-year operating lease expense to assess the true economic burden.