And then the export market we’ll just have to read that and see if it’s going to be in that 7 to 8 million ton level, slide back, slide it up. It just depends on whatever the market’s going to be at the time.
Operator: Next question is coming from Mark Reichman from Noble Capital Markets.
Mark Reichman: Thank you and good morning. So just continuing that discussion on 2024. So I mean for 2023 from the last quarter, it looked like you picked up 500,000 tons in the export market. And for 2024, you picked up an additional 400,000 tons kind of split evenly between domestic and export. And that’s a little slower than where you were last year third quarter, compared to the second quarter. So is this just a timing or do you think, I mean, are you looking at it from a standpoint that, yes, this overhang, it’s slowing things down a little bit. Good way on domestic pricing, but you’ll make some of that up in the export market or do you feel like the domestically, it’s just kind of a timing that you would, at the kind of — at the very least be kind of even for with 2023 levels.
Joe Craft: We think consumption in the U.S. domestic market for coal in ‘24 will be very comparable to ‘23. And we know that was impacted by natural gas prices. We are seeing natural gas prices rise compared to where it’s been in 2023, so there could be some upside to that, but there is still the increased inventory that the utilities have to, they would like to work down, and maybe that’s 20-day supply at both the Illinois Basin and Northern App. So we’re not anticipating the increase in sales, as I just mentioned to the domestic market. So we do believe we will be selling more tons in the export market in ‘24 than ‘23 as we look at our book of business today. So again, we’re looking at 35 million tons sales this year, 35 million next year, possibly going to 36, depending on what the demand is for coal.
Mark Reichman: Okay, no, that’s very helpful. And then also, this quarter, I had not assumed any outside coal purchases during the quarter and you had some in the second quarter. Do you expect any in the fourth quarter?
Joe Craft: So those purchases were really caused by our longwall not producing in the third quarter. So when we look at the fourth quarter, Cary, do we, I don’t think we have very much.
Cary Marshall: Maybe just a modest amount. It’s not very much at Illinois.
Mark Reichman: Okay, great. And then just lastly, on capital allocation. Joe, you did a very articulated kind of your capital allocation strategy on the last quarter call. But the company is finding some very promising investments outside its traditional businesses. So, I mean, if you were to wanting to increase, let’s say the amount of investments outside the traditional businesses, how are you thinking about claims on cash flow for 2024 being the debt repayment, the dividend or the distribution versus growth expenditures?
Joe Craft: Yes. I think when we’re to respond to that question, we have been evaluating opportunities to refinance some of the senior notes as opposed to paying them off. It would free that cash flow up. So there’s about four different avenues we’re evaluating and we find that they’re promising that it’s more likely than not we’ll be able to do that. So that’s going to free up. So we’re 285 today, Cary.
Cary Marshall: That’s right.
Joe Craft: Yes. So assuming that we can refinance that 285, that’s going to free up some capital that allows us to follow the path that I talked about last quarter on our capital allocations.
Operator: Next question is coming from David Marsh from Singular Research.
David Marsh: Hi, guys. Thanks for taking questions. I just wanted to follow up actually on kind of where that last line of question was going with regard to the acquisitions outside of the coal space into some of the newer ventures. Could you just talk about kind of a long-term plan and thought process in terms of how large these external investments could grow? And obviously, I think it’s pretty exciting that the acquisition into the electric vehicle battery or recycling space, could just talk about any other spaces that you’re looking at outside of the traditional coal and oil and gas spaces that could be potentially on the horizon.
Joe Craft: Yes. So I think we mentioned in our release as well as in Cary’s comments and mine as well that both of our investments, in the investment in Ascend as well as the investment that we made Infinitum, we believe not only are the investments in those companies but we believe that they’ll provide strategic opportunities for us that we could invest. And it’s a little premature to give you exact dollar amounts as to what that could be, but it could be sizable. So what we’re looking for with those relationships are the ability to invest in businesses that we can bring online that would be sustainable for many years, and that can generate cash flow that actually can be financeable as well. So that’s our goal within those two investments.
We have focused within our technology group at Matrix to focus on the battery space, and that battery space can be anything from what we’re talking about with Ascend, it could be with battery recycling. It can also be in battery storage, whether it be for industrial, whether it be for commercial, whether it be for utility grade, battery storage that we think is necessary. There could be, in addition to the recycling, other aspects of battery technology, we’re looking at some manufacturing work that can apply to the transmission area and the build-out of the grid, utilizing our machine shops that we have within, that are being managed by the Matrix group as well. We’re also looking at Matrix and their products that they’re developing. We’ve talked in the past about them growing their cash flow with innovative products that they are bringing to market specifically, they’re in Telezone, which is the product that we have now that has been providing the cash flow.
That’s being broadened internationally and we believe that has growth potential and we’re booking orders for 2024 and that specific area of Matrix. In addition, they’ve got OmniPro, which we’ve talked about. It’s also going to be rolling out in 2024, which is a collision of when it’s camera type technology for the forklift industry. We think that within that technology company we have, there are a lot of exciting things that there are indeed group are looking at that we think will be adding meaningfully as we look over the next five to six years, meaningfully growing that particular segment to hopefully it will be large enough to be a segment in three to four years if we can bring these things to market like we’re currently anticipating. So those are some of the ideas that we have.
And obviously we’re continuing to believe in our mineral segment and continuing to want to invest in that so that that can continue to grow as well as the other new venture concepts that I just outlined.
