106455--3/12/2010--WESTMORELAND_COAL

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Risk Factors Relating to our Operations We may not generate sufficient cash flow to pay our operating expenses, meet our debt service costs and pay our heritage and corporate costs, and we may not be able to obtain additional sources of liquidity to meet these needs. We have a significant amount of debt, which imposes restrictions on us and may limit our flexibility, and a decline in our operating performance may materially affect our ability to meet our future financial commitments and liquidity needs. If we fail to comply with certain covenants in our various debt arrangements, it could negatively affect our liquidity and ability to finance our operations. Continuing unfavorable economic conditions could have a material adverse effect on our results of operations. Our dependence on a small group of customers could adversely affect our revenues if such customers reduce or suspend their coal purchases or if they become unable to pay for our coal. If our assumptions regarding our future expenses related to employee benefit plans are incorrect, then expenditures for these benefits could be materially different than we have assumed. Inaccuracies in our estimates of our coal reserves could result in decreased profitability from lower than expected revenues or higher than expected costs. If the assumptions underlying our reclamation and mine closure obligations are materially inaccurate, we could be required to expend greater amounts than anticipated. If the cost of obtaining new reclamation bonds and renewing existing reclamation bonds continues to increase or if we are unable to obtain additional bonding capacity, our operating results could be negatively affected. Our coal mining operations are subject to external conditions that could disrupt operations and negatively affect our profitability. Should our Private Letter Ruling pertaining to our Indian Coal Tax Credit, or ICTC, be audited by the IRS, the transaction may be cancelled and we may be required to return payments received from the third party. Our future success depends upon our ability to continue acquiring and developing coal reserves that are economically recoverable and to raise the capital necessary to fund our expansion. Union represented labor creates an increased risk of work stoppages and higher labor costs. Our revenues could be affected by unscheduled outages at ROVA or if the scheduled maintenance outages at ROVA last longer than anticipated. The profitability of ROVA could be severely affected beginning in 2014 due to differences in the termination dates of our coal supply agreements and power purchase agreements. Permitting issues in Central Appalachia could put ROVA s coal supply at risk. Risk Factors Relating to the Coal and Power Industries The recent downturn in the domestic and international financial markets, and the risk of prolonged global recessionary conditions, could adversely affect our financial condition and results of operations. Increased consolidation and competition in the U.S. coal industry may adversely affect our revenues and profitability. Any change in consumption patterns by utilities away from the use of coal could affect our ability to sell the coal we produce or the prices that we receive. Extensive government regulations impose significant costs on our mining operations, and future regulations could increase those costs or limit our ability to produce and sell coal. Extensive environmental laws and regulations affect the end-users of coal and could reduce the demand for coal as a fuel source and cause the volume of our sales to decline. These laws and regulations could also impose costs on ROVA that it would be unable to pass through to its customer. Risk Factors Relating to our Equity Provisions of our certificate of incorporation, bylaws, Delaware law and our stockholder rights plan may have anti-takeover effects that could prevent a change of control of our company that stockholders may consider favorable, and the market price of our common stock may be lower as a result. Future sales of our common stock by our major stockholder may depress our share price and influence our management policies.

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106455--3/12/2010--WESTMORELAND_COAL_Co