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PEABODY ENERGY
News Release


                                                                  CONTACT:
                                                                  Vic Svec
                                                                  (314) 342-7768



FOR IMMEDIATE RELEASE
July 27, 2001


PEABODY ENERGY ANNOUNCES
CHANGE TO CALENDAR YEAR

ST. LOUIS,  July 27 - Peabody Energy (NYSE:  BTU)  announced  today that it will
change its financial  reporting to a calendar basis from the current fiscal year
that ends March 31, 2002. The change is intended to improve the comparability of
the  company's  results  with the  industry  and aid the  financial  community's
analysis of the  business.

Peabody Energy (NYSE: BTU) is the world's largest  private-sector  coal company.
Its coal fuels more than 9 percent of all U.S.  electricity  generation and more
than 2 percent of worldwide electricity generation.