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News Release

Arch Coal, Inc. Reports Third Quarter 2009 Results
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Arch Coal delivers a solid operating performance in weak market cycle

                                Earnings Highlights
                                -------------------

    In $ millions, except per      Quarter Ended      Nine Months Ended
     share data                 9/30/09     9/30/08   9/30/09   9/30/08
    ------------------------    -------     -------   -------   -------

    Revenues                     $615.0     $769.5    $1,850.6  $2,253.9
    Income from Operations         48.3       87.9        94.2     373.9
    Net Income(1)                  25.2       97.8        40.6     292.0
    Fully Diluted EPS              0.16       0.68        0.28      2.02
    -----------------              ----       ----        ----      ----
    Adjusted EBITDA(2)           $120.6     $159.9      $314.4    $590.3

    (1)/- Net income attributable to ACI.
    (2)/- Adjusted EBITDA is defined and reconciled under "Reconciliation of
          Non-GAAP Measures" in this release.

ST. LOUIS, Oct 30, 2009 -- Arch Coal, Inc. (NYSE: ACI) today reported net income of $25.2 million, or $0.16 per fully diluted share, in the third quarter of 2009 compared with net income of $97.8 million, or $0.68 per fully diluted share, in the third quarter of 2008. The company also recorded adjusted earnings before interest, taxes, depreciation, depletion and amortization ("EBITDA") of $120.6 million in the third quarter of 2009, representing a decline versus the prior-year quarter when stronger coal market conditions prevailed.

"Arch's third quarter financial results reflect an improved performance over the second quarter," said Steven F. Leer, Arch's chairman and chief executive officer. "We achieved margin expansion in each operating segment, driven by increased metallurgical coal demand in Central Appalachia and continued successful cost control across all regions. Our trading and brokerage operations also added incremental earnings in the quarter just ended."

For the first nine months of 2009, Arch earned net income of $40.6 million and adjusted EBITDA of $314.4 million. Net income and earnings per share figures included $7.2 million of expenses pertaining to the acquisition of Jacobs Ranch. By comparison, Arch earned net income of $292.0 million and adjusted EBITDA of $590.3 million in the prior-year period when coal market conditions were stronger.

Strategic Acquisition

As previously announced, Arch completed the acquisition of Rio Tinto's Jacobs Ranch mine on Oct. 1, 2009, for a purchase price of approximately $764 million, which includes an estimate for working capital adjustments. The company estimates synergies from the transaction of between $45 million and $55 million annually, beginning in 2010. Roughly one half of the synergies represent operational cost savings, while the remaining savings relate to administrative cost reductions as well as enhanced coal-blending optimization opportunities.

"The acquisition of Jacobs Ranch will further expand our size, scale and strategic position in the Powder River Basin ("PRB"), the nation's largest, fastest-growing and most cost competitive coal supply region," said Leer. "The integration of Jacobs Ranch into Black Thunder also creates what we believe to be the largest single coal-mining complex in the world, and further strengthens Arch's standing as a preferred, low-cost energy supplier to our nation's electric power generators."

"The integration process has been smooth and swift to date, and we remain on target for complete integration during the fourth quarter," said Leer. "This acquisition will allow us to reduce the expanded operation's average cost structure, improve coal quality optimization, boost our operational flexibility and increase output as market conditions warrant."

"Looking ahead, this acquisition supplements our existing low-cost assets and reserves in the PRB and further positions the company to capitalize on improving coal market fundamentals as 2010 progresses," continued Leer.

During the fourth quarter of 2009, Arch expects to record roughly $8 million in one-time acquisition-related expenses related to severance costs, advisory and legal fees as well as other costs from the integration of the operations.

Financial Developments

During the third quarter of 2009, Arch issued new debt and equity, with net proceeds from those transactions totaling nearly $900 million. Additionally, the company successfully amended and extended its $800 million revolving credit facility, increasing the capacity to $860 million through June 2011 and extending more than 95 percent of the original capacity through March 2013.

Arch ended the third quarter of 2009 with $1.9 billion in total debt, slightly increasing its debt-to-total-capital ratio to 47 percent. At Sept. 30, the company had $1.466 billion of committed total liquidity, comprised of $840 million of cash on hand and $626 million available under its short-term borrowing facilities. On a pro forma basis at Oct. 1 (which reflects the payment of $764 million for the Jacobs Ranch acquisition), Arch had $702 million of committed total liquidity.

"Arch's successful capital markets transactions helped to pre-finance the Jacobs Ranch acquisition, further strengthen our balance sheet and expand our liquidity position," said John T. Drexler, Arch's senior vice president and chief financial officer. "We currently expect our cash on hand plus the expected cash flows from operations to sufficiently fund our anticipated capital spending plans for the remainder of this year and next year."

Operational Results

"Our mines turned in good operational performances in the third quarter of 2009 when compared with the second quarter, with each region achieving an increase in per-ton operating margin and demonstrating effective cost management," said John W. Eaves, Arch's president and chief operating officer. "In particular, our Western Bituminous region overcame several challenges during the first half of the year to deliver a significant expansion in operating margin in the third quarter. Additionally, our Central Appalachian region benefited from improving metallurgical coal sales in the quarter just ended compared with the second quarter of 2009."

                                        Arch Coal, Inc.
                                     3Q09      2Q09     3Q08
                                     ----      ----     ----

    Tons sold (in millions)            29.1     27.4     34.8
    Average sales price per ton      $20.05   $19.43   $20.38
    Cash cost per ton                $15.75   $16.26   $14.59
    Cash margin per ton               $4.30    $3.17    $5.79
    Total operating cost per ton     $18.19   $18.74   $16.65
    Operating margin per ton          $1.86    $0.69    $3.73

    Consolidated results may not tie to regional breakout due to rounding.

    Above figures exclude transportation costs billed to customers.

    Operating cost per ton includes depreciation, depletion and
    amortization.

    Amounts reflected in this table exclude certain coal sales and purchases
    which have no effect on company results.  For further description of the
    excluded transactions, please refer to the supplemental regional schedule
    that can be found at http://investor.archcoal.com.

Consolidated tons sold and average sales price per ton increased modestly in the third quarter of 2009 compared with the second quarter, reflecting a larger sales percentage of Western Bituminous and Central Appalachian tons in the company's overall sales mix. Third quarter 2009 consolidated per-ton operating costs declined 3 percent over the same time period, benefiting from cost containment across the company's operating segments. Arch's consolidated operating margin expanded nearly three-fold in the third quarter of 2009 compared with the second quarter.

                                              Powder River Basin
                                            3Q09      2Q09      3Q08
                                            ----      ----      ----

    Tons sold (in millions)                  21.5     21.3      26.2
    Average sales price per ton            $12.26   $12.56    $11.21
    Cash cost per ton                      $10.04   $10.54     $9.27
    Cash margin per ton                     $2.22    $2.02     $1.94
    Total operating cost per ton           $11.31   $11.84    $10.41
    Operating margin per ton                $0.95    $0.72     $0.80

    Above figures exclude transportation costs billed to customers.

    Operating cost per ton includes depreciation, depletion and
    amortization.

In the Powder River Basin, third quarter 2009 volumes increased slightly when compared with the second quarter, due to higher brokerage activity which offset lower production stemming from current weak coal market conditions. Average sales price declined $0.30 per ton over the same time period, resulting from lower pricing obtained on market-priced tons as well as a larger percentage of lower-priced Coal Creek tons in the region's sales mix. Despite reduced production, third quarter 2009 operating costs fell by $0.53 per ton versus the second quarter, driven by ongoing cost containment efforts in the region. Arch's Powder River Basin segment expanded its third quarter 2009 per-ton operating margin by 32 percent compared with the second quarter.

                                         Western Bituminous Region
                                         3Q09      2Q09       3Q08
                                         ----      ----       ----

    Tons sold (in millions)                4.6       3.5      5.1
    Average sales price per ton         $29.08    $29.93   $26.76
    Cash cost per ton                   $20.70    $26.06   $19.01
    Cash margin per ton                  $8.38     $3.87    $7.75
    Total operating cost per ton        $25.57    $31.49   $22.69
    Operating margin per ton             $3.51    ($1.56)   $4.07

    Above figures exclude transportation costs billed to customers.

    Operating cost per ton includes depreciation, depletion and
    amortization.

In the Western Bituminous region, third quarter 2009 volumes increased 1.1 million tons versus the second quarter, reflecting increased shipments among the operations in Utah. Average sales price declined $0.85 per ton over the same time period due to a less favorable mix of customer shipments. Third quarter 2009 operating costs declined $5.92 per ton compared with the second quarter, benefiting from the absence of longwall moves and improved cost control at the West Elk mine during the quarter just ended. The Western Bituminous region achieved a significant improvement in operating profit in the third quarter of 2009, recording operating margin of $3.51 per ton compared with a loss of $1.56 per ton in the second quarter.

                                            Central Appalachia
                                         3Q09       2Q09      3Q08
                                         ----       ----      ----

    Tons sold (in millions)                3.0       2.7       3.5
    Average sales price per ton         $62.44    $60.66    $78.95
    Cash cost per ton                   $49.32    $49.26    $47.56
    Cash margin per ton                 $13.12    $11.40    $31.39
    Total operating cost per ton        $56.50    $57.30    $54.11
    Operating margin per ton             $5.94     $3.36    $24.84

    Above figures exclude transportation costs billed to customers.

    Operating cost per ton includes depreciation, depletion and
    amortization.

    Amounts reflected in this table exclude certain coal sales and
    purchases which have no effect on company results. For further
    description of the excluded transactions, please refer to the
    supplemental regional schedule that can be found at
    http://investor.archcoal.com.

In Central Appalachia, third quarter 2009 volumes increased moderately compared with the second quarter, reflecting higher shipment levels of metallurgical, pulverized coal injection (PCI) and steam coal tons. Average price realizations rose by $1.78 per ton over the same time period, benefiting from higher pricing on metallurgical and PCI coal sales and increased metallurgical/PCI coal shipments. Third quarter 2009 operating costs declined $0.80 per ton versus the second quarter, driven by higher volume levels and cost control efforts across the operations. Arch's Central Appalachian segment expanded its per-ton operating margin by 77 percent in the third quarter of 2009 versus the second quarter.

Coal Market Trends

Arch believes that coal markets are in the early stages of recovery after having suffered a record decline in coal consumption during 2009. Specifically:

    --  Improving global and domestic steel utilization is translating into
        increased demand for U.S. metallurgical grade coal.  As seen in prior
        market cycles, strong metallurgical coal markets create a spillover
        effect on steam markets as high-quality steam coal migrates to
        metallurgical coal markets to meet rising demand.
    --  A resumption of economic growth in Asia has fueled increased coal
        consumption in that region.  In addition, ongoing supply constraints in
        traditional coal exporting nations should again help further tighten
        seaborne coal supply.  These shifting trends in global seaborne coal
        supply flows will likely create opportunities for increased U.S.
        metallurgical and steam coal exports over time into both the Atlantic
        and Pacific markets.
    --  While natural gas storage levels remain well above historical averages,
        the significant decline in rig counts along with under-investment across
        the natural gas sector and the prospect for recovery in industrial
        demand have increased natural gas futures prices to well above $5 per
        million Btu in 2010, which should reverse the trend of coal-to-gas
        switching.
    --  While Arch estimates U.S. power demand will decline 4 percent in 2009 -
        due to one of the mildest summers on record in major coal consuming
        regions as well as significant declines in industrial demand stemming
        from the global recession - the company believes coal consumption could
        grow again in 2010 even if power demand increases only modestly.  In
        particular, Arch expects coal to regain ground lost temporarily to
        competing fuels such as nuclear, hydro and natural gas, considering the
        start of nuclear refueling cycles, more normal weather patterns and
        higher natural gas price futures.
    --  An estimated 55 million tons of additional domestic coal will be
        demanded by the new U.S. coal-fueled power plants coming online between
        2009 and 2012.

    --  Arch estimates total domestic coal supply will fall by roughly 100
        million tons in 2009, with declines in nearly all coal producing basins.
        In particular, Arch believes Central Appalachia is on pace to produce
        200 million tons of coal in 2009, with a fourth quarter annualized run
        rate of below 190 million tons.  Rationalization of high-cost coal
        mines, continued regulatory and permitting challenges and the roll-off
        of high-priced contracts should further reduce production in that region
        during 2010.

"While we are seeing improvement in met markets and in the underlying global and domestic economies, high stockpiles at U.S. generators will likely dampen steam coal markets in the first half of 2010," said Leer. "Thus, we will continue to implement our company strategy of matching production levels to our expectations of market demand, which we believe is in the best interest of our shareholders. We will also retain the flexibility to respond to improving coal market fundamentals, which we believe will occur during the course of 2010 and 2011."

Sales Contract Portfolio

Including volume from Jacobs Ranch for the fourth quarter of 2009, Arch now projects total sales volumes from company-controlled operations of between 121 million and 125 million tons for full year 2009, excluding purchased coal from third parties.

Given revised volume levels and limited sales commitments signed in the third quarter, Arch is now fully committed and priced for 2009. Based on 2009 production levels, the company has uncommitted volumes of 15 million to 25 million tons in 2010, and uncommitted volumes of 80 million to 90 million tons in 2011. In addition, Arch has roughly 10 million tons of coal committed but not yet priced in 2010 and approximately 15 million tons committed but not yet priced in 2011.

"During the third quarter, we sold additional volumes into met markets, putting us on target to sell 2 million tons into met and pulverized coal injection markets in 2009," said Eaves. "Additionally, we successfully shipped another vessel of steam coal to China off the West Coast in September, and continue to have discussions for supplying the fast-growing Asia-Pacific market in the future."

"Our priorities for 2010 will be to more than double our sales of met and PCI coal, compete in the seaborne steam markets on an opportunistic basis, patiently market our uncommitted sales position and remain focused on profitably managing our business through a potentially muted 2010 domestic steam coal market," added Eaves.

2009 Guidance

Including the integration of Jacobs Ranch into Black Thunder during the fourth quarter, Arch now expects the following guidance ranges for 2009:

    --  Sales volume from company-controlled operations in the 121 million to
        125 million ton range, excluding purchased coal from third parties.
    --  Earnings per fully diluted share in the $0.28 to $0.43 range.  The
        company's 2009 earnings per share estimate includes an expected $15
        million of acquisition-related expenses ($0.06 per share) for Jacobs
        Ranch, and an estimated $16 million of non-cash intangible asset charges
        ($0.07 per share) related to above-market sales contract amortization
        stemming from the Jacobs Ranch acquisition that is expected to be
        recorded in the fourth quarter.
    --  Adjusted EBITDA in the $449 million to $490 million range.  EBITDA
        estimates exclude the impact of acquisition-related expenses for Jacobs
        Ranch.
    --  Capital spending in the $160 million to $170 million range, excluding
        reserve additions.

    --  Depreciation, depletion and amortization expense in the $314 million to
        $322 million range.

"In light of the 'Great Recession' of 2009, we're pleased to be profitably managing through a severe downturn in energy markets," said Leer. "We are also seeing domestic and global economies begin to transition from recession to recovery. With the addition of the former Jacobs Ranch operation to our safe, environmentally responsible and low-cost operational profile, we are strongly positioned for the upturn which we believe is just beginning to be reflected in coal demand."

"Looking ahead, it's our view that ongoing supply constraints here at home and around the world - coupled with a rebound in energy demand globally - will exert upward pressure on coal prices over the long term. We intend to manage our business accordingly. Arch is strategically positioned as the nation's second largest coal producer to service the expected growth in coal demand both domestically and abroad."

A conference call discussing Arch Coal's third quarter 2009 financial results will be webcast live today at 11 a.m. E.D.T. The conference call can be accessed via the "investor" section of the Arch Coal Web site (www.archcoal.com).

St. Louis-based Arch Coal is the second largest U.S. coal producer. Through its national network of mines, Arch supplies cleaner-burning, low-sulfur coal to U.S. power producers to fuel roughly 8 percent of the nation's electricity. The company also ships coal to domestic and international steel manufacturers as well as international power producers.

Forward-Looking Statements: This press release contains "forward-looking statements" - that is, statements related to future, not past, events. In this context, forward-looking statements often address our expected future business and financial performance, and often contain words such as "expects," "anticipates," "intends," "plans," "believes," "seeks," or "will." Forward-looking statements by their nature address matters that are, to different degrees, uncertain. For us, particular uncertainties arise from changes in the demand for our coal by the domestic electric generation industry; from legislation and regulations relating to the Clean Air Act and other environmental initiatives; from operational, geological, permit, labor and weather-related factors; from fluctuations in the amount of cash we generate from operations; from future integration of acquired businesses; and from numerous other matters of national, regional and global scale, including those of a political, economic, business, competitive or regulatory nature. These uncertainties may cause our actual future results to be materially different than those expressed in our forward-looking statements. We do not undertake to update our forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by law. For a description of some of the risks and uncertainties that may affect our future results, you should see the risk factors described from time to time in the reports we file with the Securities and Exchange Commission.

                        Arch Coal, Inc. and Subsidiaries
                  Condensed Consolidated Statements of Income
                     (In thousands, except per share data)

                                    Three Months           Nine Months
                                        Ended                 Ended
                                    September 30,         September 30,
                                    -------------         -------------
                                   2009      2008        2009        2008
                                   ----      ----        ----        ----
                                      (Unaudited)           (Unaudited)
    Revenues
      Coal sales                $614,957  $769,458  $1,850,609  $2,253,925

    Costs, expenses and other
      Cost of coal sales         489,290   567,372   1,503,937   1,650,259
      Depreciation, depletion
       and amortization           71,468    72,185     212,986     217,180
      Selling, general and
       administrative expenses    24,029    22,235      70,770      80,937
      Change in fair value
       of coal derivatives
       and coal trading
       activities, net            (3,342)   18,382     (10,328)    (65,336)
      Costs related to acquisition
       of Jacobs Ranch               791         -       7,166           -
      Other operating expense
       (income), net             (15,617)    1,354     (28,141)     (2,993)
                                 -------     -----     -------      ------
                                 566,619   681,528   1,756,390   1,880,047
                                 -------   -------   ---------   ---------

        Income from operations    48,338    87,930      94,219     373,878

    Interest expense, net:
      Interest expense           (29,791)  (17,019)    (70,466)    (56,228)
      Interest income                399       235       7,284       1,128
                                     ---       ---       -----       -----
                                 (29,392)  (16,784)    (63,182)    (55,100)
                                 -------   -------     -------     -------

        Income before income
         taxes                    18,946    71,146      31,037     318,778
    Provision for (benefit from)
     income taxes                 (6,270)  (26,881)     (9,590)     26,059
                                  ------   -------      ------      ------
        Net income                25,216    98,027      40,627     292,719
        Less: Net (income) loss
         attributable to
         noncontrolling
         interest                    (31)     (179)         11        (727)
                                     ---      ----         ---        ----
        Net income  attributable
         to Arch Coal, Inc.      $25,185   $97,848     $40,638    $291,992
                                 =======   =======     =======    ========

    Earnings per common share
    Basic earnings per
     common share                  $0.16     $0.68       $0.28       $2.03
                                   =====     =====       =====       =====
    Diluted earnings per
     common share                  $0.16     $0.68       $0.28       $2.02
                                   =====     =====       =====       =====

    Weighted average shares
     outstanding
      Basic                      155,622   144,035     147,122     143,885
                                 =======   =======     =======     =======
      Diluted                    156,005   144,898     147,332     144,848
                                 =======   =======     =======     =======

    Dividends declared per
     common share                  $0.09     $0.09       $0.27       $0.25
                                   =====     =====       =====       =====

    Adjusted EBITDA (A)         $120,566  $159,936    $314,382    $590,331
                                ========  ========    ========    ========

    (A) Adjusted EBITDA is defined and reconciled under "Reconciliation of
        Non-GAAP Measures" later in this release.



                         Arch Coal, Inc. and Subsidiaries
                      Condensed Consolidated Balance Sheets
                                  (In thousands)

                                                   September 30,  December 31,
                                                        2009          2008
                                                        ----          ----
                                                    (Unaudited)
    Assets
      Current assets
        Cash and cash equivalents                     $840,293       $70,649
        Trade accounts receivable                      173,994       215,053
        Other receivables                               20,662        43,419
        Inventories                                    237,293       191,568
        Prepaid royalties                               25,711        43,780
        Deferred income taxes                           33,830        52,918
        Coal derivative assets                          23,721        43,173
        Other                                           45,539        45,818
                                                        ------        ------
              Total current assets                   1,401,043       706,378
                                                     ---------       -------

      Property, plant and equipment, net             2,745,469     2,703,083
                                                     ---------     ---------

      Other assets
        Prepaid royalties                               83,722        66,918
        Goodwill                                        46,832        46,832
        Deferred income taxes                          302,377       294,682
        Equity investments                              90,306        87,761
        Other                                          124,189        73,310
                                                       -------        ------
              Total other assets                       647,426       569,503
                                                       -------       -------
              Total assets                          $4,793,938    $3,978,964
                                                    ==========    ==========

    Liabilities and Stockholders' Equity
      Current liabilities
        Accounts payable                              $129,048      $186,322
        Coal derivative liabilities                      5,640        10,757
        Accrued expenses and other current
         liabilities                                   166,448       249,203
        Current maturities of debt and short-term
         borrowings                                    195,333       213,465
                                                       -------       -------
              Total current liabilities                496,469       659,747
      Long-term debt                                 1,692,167     1,098,948
      Asset retirement obligations                     270,642       255,369
      Accrued pension benefits                          63,904        73,486
      Accrued postretirement benefits other than
       pension                                          40,566        58,163
      Accrued workers' compensation                     27,706        30,107
      Other noncurrent liabilities                      80,473        65,526
                                                        ------        ------
              Total liabilities                      2,671,927     2,241,346
                                                     ---------     ---------

      Redeemable noncontrolling interest                 8,940         8,885

    Stockholders' Equity
        Common stock                                     1,643         1,447
        Paid-in capital                              1,718,088     1,381,496
        Treasury stock, at cost                        (53,848)      (53,848)
        Retained earnings                              479,025       478,734
        Accumulated other comprehensive loss           (31,837)      (79,096)
                                                       -------       -------
    Total stockholders' equity                       2,113,071     1,728,733
                                                     ---------     ---------
              Total liabilities and stockholders'
               equity                               $4,793,938    $3,978,964
                                                    ==========    ==========



                       Arch Coal, Inc. and Subsidiaries
               Condensed Consolidated Statements of Cash Flows
                                (In thousands)

                                                        Nine Months Ended
                                                          September 30,
                                                          -------------
                                                          2009      2008
                                                          ----      ----
                                                           (Unaudited)
    Operating activities
    Net income                                         $40,627  $292,719
    Adjustments to reconcile to cash
     provided by operating activities:
      Depreciation, depletion and amortization         212,986   217,180
      Prepaid royalties expensed                        24,140    27,161
      Gain on dispositions of property,
       plant and equipment                                 (81)     (178)
      Employee stock-based compensation expense         10,253     9,768
      Changes in:
          Receivables                                   63,785   (29,646)
          Inventories                                  (45,725)    3,923
          Coal derivative assets and liabilities        21,911   (57,929)
          Accounts payable, accrued expenses and
           other current liabilities                   (74,607)   28,821
          Deferred income taxes                        (15,165)    8,067
          Other                                          8,319     8,208
                                                         -----     -----

        Cash provided by operating activities          246,443   508,094
                                                       -------   -------

    Investing activities
    Capital expenditures                              (280,033) (414,125)
    Proceeds from dispositions of property,
     plant and equipment                                   806     1,069
    Purchases of investments and advances to
     affiliates                                        (10,353)   (4,359)
    Additions to prepaid royalties                     (22,874)  (19,429)
    Reimbursement of deposits on equipment               3,209     2,697
                                                         -----     -----

        Cash used in investing activities             (309,245) (434,147)
                                                      --------  --------

    Financing activities
    Proceeds from the issuance of long-term debt       584,784         -
    Proceeds from the sale of common stock             326,452         -
    Purchases of treasury stock                              -   (47,932)
    Net increase in borrowings under lines of credit
     and commercial paper program                        4,345    50,882
    Net payments on other debt                         (13,276)  (10,995)
    Debt financing costs                               (29,596)     (233)
    Dividends paid                                     (40,347)  (35,989)
    Issuance of common stock under incentive plans          84     6,306
                                                           ---     -----

        Cash provided by (used in)
         financing activities                          832,446   (37,961)
                                                       -------   -------

    Increase in cash and cash equivalents              769,644    35,986
    Cash and cash equivalents, beginning of period      70,649     5,080
                                                        ------     -----

    Cash and cash equivalents, end of period          $840,293   $41,066
                                                      ========   =======



                       Arch Coal, Inc. and Subsidiaries
                     Reconciliation of Non-GAAP Measures
                               (In thousands)

    Included in the accompanying release, we have disclosed certain non-GAAP
    measures as defined by Regulation G.
    The following reconciles these items to net income as reported under GAAP.

    Adjusted EBITDA:

    Adjusted EBITDA is defined as net income before the effect of net interest
    expense, income taxes and our depreciation, depletion and amortization;
    less the income or loss of subsidiaries attributable to noncontrolling
    interests.

    Adjusted EBITDA is not a measure of financial performance in accordance
    with generally accepted accounting principles, and items excluded to
    calculate Adjusted EBITDA are significant in understanding and assessing
    our financial condition. Therefore, Adjusted EBITDA should not be
    considered in isolation nor as an alternative to net income, income from
    operations, cash flows from operations or as a measure of our
    profitability, liquidity or performance under generally accepted
    accounting principles. We believe that Adjusted EBITDA presents a useful
    measure of our ability to service and incur debt based on ongoing
    operations. Furthermore, analogous measures are used by industry analysts
    to evaluate operating performance. In addition, certain one-time events
    are excluded to make results more comparable between periods.  Investors
    should be aware that our presentation of Adjusted EBITDA may not be
    comparable to similarly titled measures used by other companies. The table
    below shows how we calculate Adjusted EBITDA.

                                 Three Months Ended   Nine Months Ended
                                    September 30,       September 30,
                                    -------------       -------------
                                    2009      2008      2009      2008
                                    ----      ----      ----      ----
                                     (Unaudited)         (Unaudited)
    Net income                   $25,216   $98,027   $40,627  $292,719
         Income tax expense
          (benefit)               (6,270)  (26,881)   (9,590)   26,059
         Interest expense, net    29,392    16,784    63,182    55,100
         Depreciation,
          depletion and
          amortization            71,468    72,185   212,986   217,180
         Costs related to
          acquisition of Jacobs
          Ranch                      791         -     7,166         -
         (Income) loss
          attributable to
          noncontrolling
          interest                   (31)     (179)       11      (727)
                                     ---      ----       ---      ----

         Adjusted EBITDA        $120,566  $159,936  $314,382  $590,331
                                ========  ========  ========  ========



    Reconciliation of Adjusted EBITDA to Net Income - 2009 Targets

                                            Targeted Results
                                               Year Ended
                                            December 31, 2009
                                            -----------------
                                              Low      High
                                              ---      ----
                                               (Unaudited)
    Net income attributable to Arch
     Coal, Inc.                             $42,000   $65,000
         Income tax benefit                 (20,000)   (8,000)
         Interest expense, net               98,000    96,000
         Depreciation, depletion and
          amortization                      314,000   322,000
         Costs related to acquisition
          of Jacobs Ranch                    15,000    15,000
                                             ------    ------

         Adjusted EBITDA                   $449,000  $490,000
                                           ========  ========