1037676--3/1/2007--ARCH_COAL

related topics

{gas, price, oil}

{cost, regulation, environmental}

{loss, insurance, financial}

{debt, indebtedness, cash}

{operation, natural, condition}

{customer, product, revenue}

{cost, operation, labor}

{investment, property, distribution}

{acquisition, growth, future}

{cost, contract, operation}

Risks Related to Our Business Our profitability and the value of our coal reserves depend upon coal demand by United States electric power generators and other factors beyond our control. Certain conditions or events beyond our control could negatively impact our coal mining operations, our production or our operating costs. Increases in the price of steel, diesel fuel or rubber tires could negatively affect our operating costs. Our labor costs could increase if the shortage of skilled coal mining workers continues. Disruptions in the quantities of coal produced by our contract mine operators could impair our ability to fill customer orders or increase our operating costs. Our inability to acquire additional coal reserves or our inability to develop coal reserves in an economically feasible manner may adversely affect our business. A defect in title or the loss of a leasehold interest in certain property could limit our ability to mine our coal reserves or result in significant unanticipated costs. The availability and reliability of transportation facilities and fluctuations in transportation costs could affect the demand for our coal or impair our ability to supply coal to our customers. We may be unable to realize the benefits we expect to occur as a result of acquisitions that we undertake. Our profitability depends upon the long-term coal supply agreements we have with our customers. Changes in purchasing patterns in the coal industry could make it difficult for us to extend our existing long-term coal supply agreements or to enter into new agreements in the future. The loss of, or significant reduction in, purchases by our largest customers could adversely affect our profitability. The amount of indebtedness we have incurred could significantly affect our business. We may be unable to comply with restrictions imposed by our credit facilities and other financing arrangements. Failure to obtain or renew surety bonds on acceptable terms could affect our ability to secure reclamation and coal lease obligations and, therefore, our ability to mine or lease coal. Our profitability may be adversely affected if we must satisfy certain below-market contracts with coal we purchase on the open market or with coal we produce at our remaining operations. Terrorist attacks and threats, escalation of military activity in response to such attacks or acts of war may adversely affect our business. Risks Related to Environmental and Other Regulations Federal and state regulations impose significant costs on us, and future regulations could increase those costs or limit our ability to produce and sell coal. Our failure to obtain and renew permits necessary for our mining operations could negatively affect our business. If the assumptions underlying our estimates of reclamation and mine closure obligations are inaccurate, our costs could be greater than anticipated. Our operations may impact the environment or cause exposure to hazardous substances, and our properties may have environmental contamination, which could result in material liabilities to us.

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1037676--3/1/2007--ARCH_COAL_INC