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Peabody Energy announced today that it has completed its offer to exchange up to $650 million of its registered 6-7/8% senior notes due 2013 for the comparable notes privately placed in March.

The senior notes that were issued on March 21, 2003, in a rule 144A private placement have been exchanged for new notes that have been registered under the Securities Act of 1933. The new notes were issued as part of a comprehensive refinancing aimed at increasing flexibility and lowering ongoing financing costs by more than $15 million per year.

Peabody Energy is the world's largest private-sector coal company, with 2002 sales of 198 million tons of coal and $2.7 billion in revenues. Its coal products fuel more than 9 percent of all U.S. electricity generation and more than 2 percent of worldwide electricity generation.

CONTACT: Vic Svec of Peabody Energy, +1-314-342-7768

SOURCE: Peabody Energy