Full Description

Arch Coal, Inc. is a coal producer in the United States. The Company has three business segments: the Powder River Basin, the Western Bituminous region and the Central Appalachia region. During the year ended December 31, 2008, the Company operated 20 active mines located in each of the low-sulfur coal-producing regions of the United States. Arch Coal, Inc. sells substantially all of its coal to power plants, steel mills and industrial facilities. During 2008, the Company sold approximately 139.6 million tons of coal, including approximately 6.1 million tons of coal it purchased from third parties, fueling approximately 6% of all electricity generated in the United States.

During 2008, it sold approximately 76% of coal under long-term supply arrangements. As of December 31, 2008, the average volume-weighted remaining term of its long-term contracts was approximately 3.4 years, with remaining terms ranging from 1 to 9 years. As of December 31, 2008, the Company had a sales backlog, including a backlog subject to price reopener or extension provisions, of approximately 317.5 million tons. As December 31, 2008, Arch Coal, Inc. operated 20 active mines at 11 mining complexes located in the United States.

Powder River Basin

The Company’s operations in the Powder River Basin are located in Wyoming and include two surface mining complexes (Black Thunder and Coal Creek). Black Thunder is a surface mining complex located on approximately 24,300 acres in Campbell County, Wyoming. The Black Thunder mining complex extracts steam coal from the Upper Wyodak and Main Wyodak seams. The Black Thunder mining complex shipped 88.5 million tons of coal in 2008. Black Thunder mining complex had approximately 1.3 billion tons of proven and probable reserves as of December 31, 2008. The Black Thunder mining complex consists of five active pit areas and two owned loadout facilities. The Company ships all of the coal raw to its customers via the Burlington Northern Santa Fe and Union Pacific railroads.

Coal Creek is a surface mining complex located on approximately 7,400 acres in Campbell County, Wyoming. The complex consists of two active pit areas and a loadout facility. The Company ships all of the coal raw to its customers via the Burlington Northern Santa Fe and Union Pacific railroads. Coal Creek mining complex had approximately 206.1 million tons of proven and probable reserves as of December 31, 2008.

Western Bituminous

Arch Coal, Inc.’s operations in the Western Bituminous region are located in southern Wyoming, Colorado and Utah and include four underground mining complexes (Dugout Canyon, Skyline, Sufco and West Elk) and one surface mining complex (Arch of Wyoming) that includes one active surface mine and four inactive mines. Arch of Wyoming is a surface mining complex located in Carbon County, Wyoming. The Arch of Wyoming complex consists of one active surface mine and four inactive mines located on approximately 58,000 acres that are in the final process of reclamation and bond release. The active Arch of Wyoming mining operations had approximately 19.4 million tons of proven and probable reserves as of December 31, 2008.

Dugout Canyon mine is an underground mining complex located on approximately 18,200 acres in Carbon County, Utah. Dugout Canyon mining complex had approximately 24.7 million tons of proven and probable reserves as of December 31, 2008. The complex consists of a longwall, three continuous miner sections and a truck loadout facility. Arch Coal, Inc. washes a portion of the coal it produces at a 400-ton-per-hour preparation plant. The loadout facility can load approximately 20,000 tons of coal per day into highway trucks. Skyline is an underground mining complex located on approximately 12,400 acres in Carbon and Emery Counties, Utah. The complex consists of a longwall, a continuous miner section and a loadout facility. The Company ships all of the coal raw to its customers via the Union Pacific railroad or by highway trucks.

Sufco is an underground mining complex located on approximately 25,200 acres in Sevier County, Utah. The complex consists of a longwall, three continuous miner sections and a loadout facility located approximately 80 miles from the mine. The Company ships all of the coal raw to its customers via the Union Pacific railroad or by highway trucks. West Elk is an underground mining complex located on approximately 17,900 acres in Gunnison County, Colorado. The complex consists of a longwall, three continuous miner sections and a loadout facility. Arch Coal, Inc. ships all of the coal raw to its customers via the Union Pacific railroad. The West Elk mining complex had approximately 70.9 million tons of proven and probable reserves as of December 31, 2008.

Central Appalachia

The Company’s operations in the Central Appalachia region are located in southern West Virginia, eastern Kentucky and southwestern Virginia, and include four mining complexes (Coal-Mac, Cumberland River, Lone Mountain and Mountain Laurel) consisting of nine underground mines and four surface mines. Coal-Mac is a surface and underground mining complex located on approximately 46,800 acres in Logan and Mingo Counties, West Virginia. The complex consists of one captive surface mine, one contract underground mine, a preparation plant and two loadout facilities, which it refers to as Holden 22 and Ragla. It ships coal trucked to the Ragland loadout facility directly to its customers via the Norfolk Southern railroad.

Cumberland River is an underground and surface mining complex located on approximately 17,000 acres in Wise County, Virginia and Letcher County, Kentucky. The complex consists of four underground mines (three captive, one contract) operating five continuous miner sections, two captive surface operations, two highwall miners (one captive, one contract), a preparation plant and a loadout facility. The Company ships approximately one-third of the coal raw to its customers via the Norfolk Southern railroad. Lone Mountain complex is an underground mining complex located on approximately 22,000 acres in Harlan County, Kentucky and Lee County, Virginia. The complex consists of three underground mines operating a total of seven continuous miner sections. Mountain Laurel is an underground mining complex located on approximately 38,100 acres in Logan County, West Virginia. The Mountain Laurel mining complex had approximately 90.7 million tons of proven and probable reserves as of December 31, 2008.

The Company competes with Alpha Natural Resources, Inc., CONSOL Energy Inc., Foundation Coal Holdings, Inc., Massey Energy Company, Patriot Coal Corporation, Peabody Energy Corp. and Rio Tinto Energy-North America.