A Call for Fuel Conservation

The State of Peabody Energy

Mustaches Benefit Men’s Health

3 74-5

Issue 1, 2012For Peabody Energy Employees and Stakeholders

Conveyor Issue 1, 2012|1

Peabody Energy enters 2012 in a position of strength. We have a superior production base,

industry-leading reserves and a world-class organization – made even stronger with our recent major acquisition and the formation of Peabody Energy Australia PCI.

This issue of Conveyor covers our achievements and the State of the Company meeting in depth, and I want to emphasize that our team’s accomplishments last year were significant. We experienced the best year in our history, with the safest performance, largest acquisition and strongest financial results on record. We are reshaping our portfolio to target the

highest-growth regions. We’ve built the best team in the industry, and we just added valuable PCI operations to one of the strongest metallurgical and thermal coal portfolios in the business.

Today, our global platform is positioned to serve the world’s major demand centers, and our strength results from sustained, strategic investments in long-term growth.

Still, leadership is never assured. Peabody has always been a first mover. We were among the first in the Powder River Basin in Wyoming. We were first among U.S. companies to enter Australia. We were the first to advance long-term sales contracts. And we were the first to build a coal-trading operation. We have demonstrated industry leadership in quiet and turbulent times, and our transformation continues today.

Just recently, we announced the creation of global business units in the Americas, Australia and Asia led by Rick Navarre, Eric Ford and Chris Hagedorn, respectively. The new structure reflects the growing

size and scope of Peabody’s global footprint. We have the number one position in the fastest-growing, lowest-cost U.S. regions, an expanding Australian metallurgical and thermal export platform and a major growth pipeline. The new structure positions our company for maximum success amid unique geographic market conditions and opportunities by committing dedicated business unit teams to manage all platform aspects, including safety, operations, marketing, project delivery and support functions.

The corporate function will continue to be responsible for establishing the company’s strategic direction; managing our global asset portfolio; maintaining corporate governance, policies, standards and systems; and advancing a “One Peabody” culture and voice to external stakeholders. At our core, we remain one team with one mission. We are all accountable for working together to achieve results in the same four focus areas:

• Maintaining operational excellence in core areas of safety, productivity, cost control and environmental performance;

• Capturing value by integrating our Australian platform;

• Successfully advancing our organic growth projects; and

• Aggressively reducing the company’s debt through continued capital discipline and other deleveraging initiatives.

Our team of more than 8,300 people serves customers in 25-plus nations on six continents. Together, we deliver a product that improves lives and is in demand. The world is in the early stages of a sustained supercycle for coal as nations develop, industrialize and urbanize. Coal is the only source with the low cost and large scale to satisfy extraordinary energy needs.

That is why coal has been the fastest-growing fuel in the world over the past decade and why global coal use is expected to rise 65 percent over the next 25 years.

So, the world is changing. Our industry is changing. And our company is changing. But with change comes opportunities – to lift millions of people into a better quality of life, to advance growth opportunities for employees and to make a difference in communities around the world.

Each day, we will need your renewed commitment to safety, operational and environmental excellence. Thank you for your hard work and many contributions, and I look forward to the rest of a safe and successful 2012.

Greg Boyce, Chairman and Chief Executive Officer

Message froM ChairMan and Chief exeCutive offiCer greg BoyCe

In Queensland, Australia’s Bowen Basin, the Burton Mine is undergoing a 1-million ton-per-year extension that is expected to add incremental volumes of hard coking coal.

An employee ascends the conveyor system at North Antelope Rochelle Mine. The mine shipped a record 109 million tons in 2011, ending the year as the world’s largest and most productive coal mine.

2012 Brings New Organization and Focus Areas

Each day, we will need your renewed commitment to safety, operational and environmental

excellence. Thank you for your hard work and many contributions, and I look

forward to the rest of a safe and successful 2012.

2|Conveyor Issue 1, 2012

Conveyor is written for employees and stakeholders and is produced by the Investor Relations & Corporate Communications Department.

© 2012 Peabody Energy

The use of the words “Peabody,” “the company” and “our” relate to Peabody, our subsidiaries and our majority-owned affiliates.

Peabody Energy Peabody Plaza 701 Market Street St. Louis, MO 63101-1826 Phone: 314-342-3400 EmployeeCommunications@PeabodyEnergy.comPeabody Energy (NYSE: BTU) is an Equal Opportunity Employer.

Printed on recycled paper.

Visit the new PeabodyEnergy.com for company news, interactive features, video and more.

Integration Follows Major Acquisition Peabody Becomes World’s Largest Seaborne Low-Volatile PCI Coal Supplier

What do the steel towers of Shanghai or Sapporo have in common with a cluster of mines

thousands of miles away in Queensland? Plenty when it comes to Peabody. The company recently formed Peabody Energy Australia PCI to serve growing steel demand throughout the world’s strongest economies.

“Peabody Energy Australia PCI expands our company’s metallurgical and thermal portfolio, brings significant reserves and adds development projects,” says Chairman and Chief Executive Officer Greg Boyce. The move made Peabody the world’s largest supplier of seaborne low-volatile PCI coal used to make steel and among the top three coal reserve holders in Australia.

Adds Julian Thornton, Group Executive of Peabody Energy Australia PCI: “Peabody and its new operations share much in common, including a commitment to safety at all levels and sustainable

growth. We are strengthened by the talents and contributions of our combined workforces.”

With the acquisition, Peabody gains a majority interest in two operations in Australia’s coal-rich Bowen Basin: Coppabella and Moorvale.

“Since the acquisition, teams around the world have been active on multiple fronts,” says President – Australia Eric Ford. “For example, we have begun work at Coppabella to build out a larger operating footprint, boost equipment utilization and improve the cost structure. We also are working on marketing and blending synergies and consolidating shipment schedules.”

The company is focused on integrating operations, aligning organizational structures and adopting the most effective practices from both organizations. Employees will see greater standardization of systems and processes as the company implements a shared services model.

Peabody also now has a 50 percent interest in the Middlemount Mine joint venture, which began shipments following the recent completion of rail infrastructure. The Codrilla Mine project is among additional projects in development.

“Together, we are even better equipped to expand current operations, grow our project pipeline and leverage expertise to improve performance,” says Eric. “We have the opportunity to create a great Australian organization that will fuel the world’s major demand centers for decades to come.”

When safety ideas and processes are shared across operations, we all benefit.” So says Peabody Energy Director of Safety Management

Rick Wells when describing the strategy behind the company’s Safety Innovation Awards. Now in its second year, the awards program attracted 87 entries, an increase of 35 percent. The following honors celebrate remarkable collaboration, continuous improvement and ingenuity at operations across the company.

Best Overall: Hydraulic Fluid Injection Detection System, Metropolitan Mine, New South Wales, Australia A pressurized hydraulic line can be as thin as a pencil or as thick as a baseball bat. And, through thick and thin, the Metropolitan Mine team is working to advance innovation.

The team created a system that allows employees to identify hazards from a distance by introducing a tracer dye into the hydraulic fluid. The dye is detectable using a special light.

“Identifying a circuit leak from a distance with the light removes the need for maintenance workers to get close to a potential source of risk,” says Metropolitan Mine Occupational Health and Safety Manager Chris Bate. “In the rare instance that fluid injection occurs, the dye allows for quick and precise treatment.”

Most Original, Best Overall – First Runner Up: Continuous Miner Sloughing Plate, Twentymile Mine, Colorado, United States Coal and roof rock can build up on a continuous miner, an underground mining machine that uses a large rotating steel drum to remove coal from a seam. Typically, operators manually clean heavy debris from the machine, but Twentymile miners found a better way. They created a hydraulic sloughing plate that automatically lifts and removes excess coal and rock. The device eliminates the need for workers to manually remove coal and rock from the miner and allows the machine to run continuously.

Best Overall – Second Runner Up: Monorail Installation Platform, Twentymile Mine, Colorado, United States Extending for miles, Twentymile Mine features an underground longwall that is propelled by cables and hoses suspended from a roof-mounted monorail.

Workers must repeatedly lift 80-pound sections of this rail as part of removal and installation. Exposure to a conveyor belt and uneven ground can pose risks in underground mining. The Twentymile maintenance team built a hydraulic platform that can be raised or lowered to the desired height, eliminating direct exposure to the belt conveyor and ground with guardrails. “This design allows flexibility to adjust as the coal seam height changes,” says Longwall Coordinator Travis Brown.

Most Transferable: Bucket Tooth Pin Installer, Viking Mine, Indiana, United States Bucket tooth pins can take a beating over time. After all, just changing these essential locking devices traditionally requires one operator to swing a metal sledge hammer while another holds a pin in place. The Viking safety team devised a pin installer and remover, replacing the sledge hammer with a portable hydraulic jack. The jack inserts the pin, making the task safer and easier.

From left, President – Australia Eric Ford presents Safety Innovation Award honors, including a cash incentive, to Metropolitan Mine Occupational Health and Safety Manager Chris Bate alongside Senior Vice President of Global Safety Chuck Burggraf.

Safety Awards Shine Light on Innovations

Queensland

The Coppabella and Moorvale mines are located to the east of Peabody’s Millennium Mine in the Bowen Basin. Announced projects and other developments are located south of these operations.

About Pulverized Coal Injection (PCI) CoalThe pulverized coal injection (PCI) process enables steelmakers to replace coke – made from metallurgical coal – with PCI coal through a carefully timed injection into a blast furnace. One metric ton of low-volatile PCI coal can offset approximately 1 metric ton of coke.

PCI coal can offer substantial cost savings, and demand has outpaced supply growth over the past few years.

“

Conveyor Issue 1, 2012|3

Small Efforts to Save Fuel Drive BIG ResultsNext time you fuel up, speak out. That is the

simple message behind a new Fuel Conservation Initiative being unveiled across the company. Peabody Energy is seeking to save 5 million gallons of diesel – almost 19 million liters in a year – by capitalizing on the creativity of employees and contractors.

Even when performing routine tasks, people have the power to work smarter, save fuel and reduce emissions, says President – Australia Eric Ford. “Conserving fuel supports Peabody’s vision of managing safe, efficient and technology-driven operations,” says Eric. “At a time when we face significant fixed costs and evolving regulatory measures, we can use innovation and teamwork to drive continuous improvement.”

Diesel is Peabody’s single largest consumable expense. In a single year, Peabody uses about 150 million gallons or almost 570 million liters. This costs more than $470 million, or AUD$477 million, at today’s rates. Every gallon saved boosts Peabody’s competitiveness in global markets.

In the coming months, a cross-functional Fuel Conservation Best Practice Team will work to engage employees, company contractors and vendors and industry experts to raise awareness, develop projects and metrics, and distribute best practices. Success will mean saving enough fuel to fill more than seven Olympic-size swimming pools.

Eric thinks employees are more than up to the challenge and emphasizes that everyone will have a role to play.

Operations already are delivering results. For instance, employees are using the modular mining dispatch system at the North Antelope Rochelle Mine in the Powder River Basin to monitor idling time on haul trucks. The technology generates alerts and tracks trends. The detailed analysis has led to reductions in non-productive idle time by half, driving a corresponding improvement in fuel efficiencies, says Director of Continuous Improvement John Keller.

“We are not only reducing our carbon footprint and fuel spending but also avoiding unnecessary wear on machine engine components,” John adds.

The Fuel Conservation Initiative is among multiple energy-efficiency efforts under way across Peabody operations.

“Fuel conservation is relevant globally, and our Fuel Conservation Initiative complements Energy Efficiency Opportunity programs across Australia,” says Bertus de Jager, Peabody Energy Australia Vice President of Continuous Improvement, Asset Management and Applied Technology. He points to the carbon taxation regime in Australia as another impetus to reduce diesel use and target a lower emissions future.

Share your fuel conservation best practices, ideas and success examples. E-mail SaveFuel@PeabodyEnergy.com. Please include your name and contact information.

transporting waste off site once surface storage capacity was reached. Transportation constraints limited production at the operation, and the mine team realized that the off-site facility would run out of available space as early as 2015, says Greg Tarrant, Metropolitan Manager of Technical Services.

“We needed a lasting storage solution that was safe, cost-effective, able to pump material over eight kilometers and able to last through the life of the mine,” says Greg. “We considered options including burning the material for use in ceramics and sending the waste rock via train to a disused quarry. The only sustainable and economically viable solution was the paste plant rejects backfill approach.”

Employees at Australia’s oldest operating mine are developing some of the world’s most modern

technology to recycle reject material.

Peabody Energy’s Metropolitan Mine has operated in the Southern New South Wales coalfields, adjacent to a national park, for 125 years. While the setting is picturesque, space is limited. So the mine has pursued a novel method to convert reject material from its preparation plant into a high-density slurry paste. The paste is injected underground into abandoned mine workings.

When fully implemented by 2015, the technology should significantly minimize the truck transportation of waste rock through town, introducing significant environmental, safety and community benefits, says Metropolitan Mine Environment and Community Manager Ryan Pascoe.

“In one year, this technology would remove more than 10,000 trucks from the roadway that comprises the town’s main street. That is more than 350,000 trucks over the life of the mine,” says Ryan. “We see benefits in relation to dust, noise, visual amenity and road safety.”

The project dates back to 2006, but the initiative was designed to address a challenge that first emerged even earlier. In the late 1990s, the mine began

New equipment was modified to meet Australian and Peabody standards, and the team began to manually inject paste underground, a labor- and resources-intensive process. Soon the team devised a better way, automating the process and helping reduce operating costs by half.

Metropolitan’s approach has become a model for the industry. The New South Wales Minerals Council honored the mine’s innovation with an Environmental and Community Excellence Award and the Council’s delegates selected the operation for the People’s Choice Award. Observers believe broad adoption of the mine’s technology has the potential to significantly ease disposal issues and decrease the potential for subsidence impacts when waste rock is stored within a longwall zone.

Ryan agrees that the mine has just begun to see the benefits of its backfilling technique.

“Recent awards tell us we are having a genuine impact – we’re on the right track,” he says. “But we believe in continuous improvement. This is a milestone, not an endpoint.”

So what’s next? The team is working to integrate a full-scale version of the technology into Metropolitan’s preparation plant. The move will enable the mine to recycle more than 600,000 tonnes of rejects material per year. The team also is exploring other beneficial uses of material such as in road construction.

Metropolitan Mine Pioneers Underground Recycling of Coal Mine Waste

The Metropolitan Mine is expected to be the world’s leading mine in capturing and placing coal mine waste material – without fly ash – underground. It also will become the only Australian operation to adopt the paste process.

“In one year, this technology would remove more than 10,000

trucks from the roadway that comprises the town’s main street.”

Ryan Pascoe,Metropolitan Mine Environment

and Community Manager

PEABODY SHARES GLOBAL REPORT CARD WITH TEAM ON FOUR CONTINENTSTHE STATE OF PEABODY ENERGYPeabody Energy’s inaugural State of the Company global town hall reported on the company’s progress and record results. This Conveyor shares key messages and metrics highlighted during the meeting and webcast.

The STaTe of our CompanyGreg Boyce, Chairman and Chief Executive Officer

I want each of you to have a tremendous sense of pride for the game-changing play that we are making to energize the world. Peabody has unmatched assets and access to the

highest growth global coal markets. We have the leadership position in the lowest-cost, fastest-growing U.S. regions, an expanding Australian platform and a growing Asian presence.

Most important, we have the best talent, assets and strategies for long-term success. Peabody is energy, and energy is the essential building block for healthy living and modern society. Our work is vital, and it makes every generation stronger and better.”

“

2008

2009

2010

2011

2007

$4,4

22

$6,3

36

$5,8

47

$6,7

40

$7,9

74

+80%

revenuesDollars In Millions

2008

2009

2010

2011

2007

$592

$1,2

82

$822

$1,3

54

$1,5

93

+170%

operating ProfitDollars In Millions

2008

2009

2010

2011

2007

$958

$1,7

28

$1,2

63

$1,8

39

$2,1

29

+120%

adjusted eBitda(1)

Dollars In Millions

Transformation Leads to Record Financial Results Increasing Revenues, Operating Profit and Adjusted EBITDA

Financials include Macarthur contribution and exclude discontinued operations.1 Adjusted EBITDA is defined as income from continuing operations before deducting net interest expense, early debt extinguishment charges, income taxes, noncontrolling interests, asset retirement obligation expense, and depletion, depreciation and amortization.

3 Continue safety improvement3 Integrate One Peabody platform3 Capture synergies and value from major acquisition3 Secure new U.S. sales and ensure contract performance3 Increase U.S. export sales from the Gulf and West Coasts3 Capture value throughout the coal chain3 Advance “Asia 100” strategy3 Complete an Investment Agreement with Mongolia to secure

Peabody’s position in developing Tavan Tolgoi3 Attract, retain and develop employees3 Advance and deliver projects on time, budget and scope3 Improve cost reduction, productivity and

environmental performance3 Improve equipment availability and maintenance practices3 Manage global weather events3 Deliver on production and cost goals by mine3 Pursue multiple opportunities to reduce debt

What We Need to Get Right

in 2012

4|Conveyor Issue 1, 2012

PEABODY SHARES GLOBAL REPORT CARD WITH TEAM ON FOUR CONTINENTSTHE STATE OF PEABODY ENERGY

Rick Navarre, President – Americas

The U.S. is half our global earnings. It’s where more than 80 percent of our production and

reserves are located, as well as most of our employees. It is a key focus for Peabody, receiving major investments in operational improvements, reserves

and mine extensions and expansions. Of course, we are challenged by the flat U.S. economy, mild weather and an oversupplied gas market. Regulatory headwinds are also weighing on our customers.

Peabody is navigating these mixed markets from a position of strength. We are the largest producer and reserve holder in the lowest cost, fastest-growing U.S. regions. We are expanding our U.S. export business; we have reached new long-term agreements to support investments in new mines and mine extensions; and we are fully contracted for U.S. production in 2012. In the current market, focus on managing margins, ensuring contract performance and increasing U.S. export sales will be critical. Our goals are many, but this is the best team in the industry, and I’m amazed by what we accomplish.”

“

Conveyor Issue 1, 2012|5

Eric Ford, President – Australia

Australia is core to Peabody’s global growth. It’s Peabody’s fastest-growing region, home to some of the world’s

highest-quality coal and our highest-margin product. Our platform has continued to deliver value, growing contributions from almost zero to half of the company’s earnings. With the PCI

operations, we are even better positioned to progress our projects pipeline, build upon the experience in our Australian businesses and leverage our global expertise.

Our plan to deliver growth is straightforward. We are focused on using best practices in safety, standard operating procedures and continuous improvement. We must – safely – deliver budgeted production whilst exercising prudent cost management principles. We will accept nothing less than zero incidents. We will continue to leverage new equipment and technology to improve performance. A shared goal for the combined platform is to become the industry leader in rehabilitation and environmental excellence.

I’ve seen moments of impressive collaboration and teamwork, innovative ideas and inspirational leadership, and, most of all, great execution from all of our employees. Together, we can make this journey a huge success whilst celebrating milestones along the way.”

“

Peabody Global(1)

Peabody delivered the safest year in its history, ending 2011 with a global incidence rate of 1.92. The company’s U.S. safety rate is less than half the U.S. industry average based on the latest available data. In Australia, the company’s safety results in 2011 were 27 percent better than the latest available average of New South Wales and Queensland operators. 1 Excludes operations acquired late in 2011.

Peabody Delivers Safest Year in 2011 Incidence Per 200,000 Hours

Incidence Rates

Peabody U.S. Peabody Australia(1)

2.92

2.71

1.92

2009

2010

2011

2.16

1.98

1.37

2009

2010

2011

4.034.

43

2.77

2009

2010

2011

U.S. and Australian Operations Each Contribute Half of Earnings

Peabody’s earnings profile illustrates the power of the company’s global platform. Australian activities comprised less than 1 percent of the company’s Adjusted EBITDA eight years ago. In 2011, Australian operations contributed half the earnings to a greatly expanded base.1 Australian Adjusted EBITDA for 2003 includes Wilkie Creek, which was held for sale as of Dec. 31, 2011.

Australian Adjusted EBITDA for 2011 excludes Wilkie Creek.

2011(1)

U.S.50%

Australia50%

U.S.>99%

2003(1)

Adjusted EBITDA from Mining Operations

1,668

1,002

798

291

175

53

(277)

-500 0 500 1,000 1,500 2,000 2,500 3,5003,000 4,000

3,922Coal

Natural Gas

Electricity Generation (TWh)

Nuclear

Solar

Hydro

Biomass

Geothermal

Oil

Projected Incremental Generation by Fuel Type (2009 – 2020)

By 2020, incremental coal use for generation is projected to surpass that of gas, oil, hydro, nuclear, geothermal, biomass and solar combined. Asian nations are expected to comprise 83 percent of this growth. About 90 gigawatts of advanced coal-fueled generating units are scheduled to come on line in 2012, representing nearly 300 million tonnes of additional coal use per year.

Source: International Energy Agency, World Energy Outlook 2011.

Global Coal Generation Growth Expected to Be More Than Twice Closest Alternative

FINANCIAL RESULTS FUEL GROWTHMike Crews, Executive Vice President and Chief Financial Officer

World-class results enable us to generate the cash to finance investments in our business. These investments allow the expanded operations and top-notch

assets that fuel even better results. Our strong earnings today make our growth tomorrow possible.

Peabody is in a great position to succeed. We have a solid financial profile… an outstanding set of assets… clear vision and a set of action plans…

and the best people in the industry.”

“

Peabody Global(1)

6|Conveyor Issue 1, 2012

Now in a prototype, Peabody’s Operations Technology Centers, planned for St. Louis and Brisbane, will capture and leverage metrics and performance detail at mines around the world – from dragline productivity rates to haul truck load capacities.

Technology Centers Designed to Connect Global OperationsIn an information-hungry world, data is power. In a

cost-competitive world, how a company converts data to information and uses technology to achieve best-in-class performance can determine winners and losers.

“Peabody’s new Operations Technology Centers are being designed to provide data to satisfy that need for information and to help us fully realize the benefits of our investments in equipment and technology. Our goal is to tap into the performance of our people, assets and strategies – safely and efficiently – and achieve best-in-class performance.“

That’s how Jeane Hull, Peabody Energy Executive Vice President and Chief Technical Officer, describes the premise behind the high-tech prototype center and project underway at the company’s St. Louis headquarters.

Peabody’s goal is to capture, standardize and centralize real time safety, maintenance, production, financial and environmental data from underground and surface mines across the company’s global platform. The project will make this information broadly available to employees on their computers and mobile devices as

well as in state-of-the-art regional and St. Louis centers. The company will benefit from standard measurement and analysis tools that provide a complete picture of the business in real time as well as the ability to manage performance by exceptions, identify trends and replicate improvements across the platform more quickly.

“Gaining real-time insight into our business allows us to make the most of our assets,” says Jeane, who explains that more data can lead to enhanced operating practices, increased equipment availability and efficiency.

“We can benefit from our common infrastructure. This Operations Technology Center project will provide the visibility across our system to consistently improve performance – both on the surface and underground – to achieve our growth objectives.

“More importantly, the centers’ efforts foster collaboration with people at every level of the company, such as within each mine, among mine sites, between business units and across regions,” she adds.

The project is in early stages, and organizers have reason to be optimistic about its benefits. Technologies already in use at the North Antelope Rochelle Mine (NARM)

have shown demonstrated results. One example of value delivered involves one of Peabody’s ultra class haul trucks. Using the equipment health monitoring system, a mine employee noticed data irregularities in strut pressures during loading. As the information was further analyzed, it was determined a set of the struts were not functioning properly. The truck was shut down and repaired, avoiding costly damage.

Operations Technology Center capabilities will not only allow NARM employees to track and share the scenario and solution, but they will allow Peabody to be able to set up alerts that instantly detect similar issues across all the Peabody mines that have similar technologies and equipment, says Vice President of Applied Information Technology Chris Shelton.

“Using tools the center will offer, our operations teams will be able to make a fast, efficient determination of the root cause of similar issues they may experience,” says Chris. “Quickly leveraging this type of knowledge from one site to another allows us to be proactive, more efficiently share best practices and respond to issues across the platform.”

Suzy Hu, Peabody Energy’s Director of Human Resources in China, believes bridging cross-

cultural differences can come down to something as simple as cranberry juice.

During a dinner meeting in the United States, a colleague urged her to try a glass of the juice. He then asked how she liked it. She replied, “It’s okay.”

Suzy laughs as she recounts her lackluster admission. “When we say, ‘It’s okay,’ we probably don’t like it,” she admits. “More often than not, people who are native to China will refrain from saying a direct ‘no.’” Learning such subtle cultural signals is essential in a global economy and one reason Peabody’s Inclusion and Diversity Advisory Board launched a new cultural exchange program featuring speakers from across the company. The cross-functional board seeks to continue to develop a workforce with diverse backgrounds and different perspectives, experiences and insights.

Suzy and Ginger Li, Head of Legal – China, participated in the first event at the company’s global headquarters in St. Louis. The duo shared insights about living and working in China as part of a growing team. Like many companies, Peabody has established a growing presence in Asia and particularly in Beijing and Urumqi in China, home to a population of 1.3 billion people – four times that of the United States.

Employees Share Insights into Life, Business in ChinaChina is expected to use more electricity than the entire Western Hemisphere in as little as 20 years. Most of that energy will come from coal. Peabody is advancing projects and partnerships with leading energy, coal and steel companies in the nation.

Accomplishing the company’s objectives in Asia and China will require mutual understanding, Ginger and Suzy say. While East and West have much in common, there are notable cultural distinctions. Take the concept of time. In China, the concept is less rigid than in Europe, Australia or America, say the pair. Flexibility can take priority over precise scheduling.

Communication styles also differ. For example, in the United States, businesspeople are encouraged to openly express an opinion or directly invite counterparts to a meeting. In China and elsewhere in Asia, business is conducted in a less linear way, with relationships built over time through many interactions. As a result, transactions can take longer to complete.

Suzy and Ginger are swift to caution that these observations are generalizations, with many exceptions. China itself is rapidly changing as its opening markets introduce many foreign cultural influences.

“The next generation is becoming much more open,” as multinational companies from Goodyear to Starbucks expand and Western movies and literature become a part of daily life, says Suzy.

Life in China: At a Glance Population: 1.3 billionCities with 1-plus million populations: 160Literacy: 86% of populationCurrency: YuanNationalities: 56Cell phones: 547 million, more than twice that in the U.S. Internet users: 253 million, compared to 223 million in U.S.Coal Demand: 5 billion tonnes by 2016

Beijing

Urumqi

Peabody Energy China Offices

Download a podcast of highlights of the session from the Inclusion and Diversity Advisory Board webpage on the Peabody Energy BTYou portal.

For David Barham, last November represented more than a month with a mustache.

The London-based Director of Global Freight Trading joined Peabody Energy employees around the world in Movember, a month-long global fundraiser for men’s health. David participated in honor of his father’s battle with cancer. “The cause is very close to my heart,” he adds.

Each November, “Mo Bros” like David register at Movember.com with clean-shaven faces. For the rest of the month, they nurture their facial hair to become things of great beauty – all with the aim of supporting education and research into men’s health. Peabody participants raised more than $50,000 in 2011. The campaign also benefited from the company’s matching gift program.

Beyond monetary benefits, Movember also strengthens teams, says Brisbane Team Captain and External Affairs Vacation Student Jodana Anglesey. “The initiative has fostered a spirit of mateship, friendly competition and personal achievement for participants and donors alike.”

The event helped inspire many fun follicle challenges, including a friendly competition between the Peabody Energy Australia and Peabody Energy Australia PCI teams. A $100 donation was at stake for the group with the most funds raised, with Peabody Energy Australia narrowly winning.

The humorous approach helps spread important information, says David: “Whilst we are having some fun looking a bit silly, there is a serious side to this campaign. We should get ourselves checked out and keep an eye on what’s happening with our health on a regular basis.”

The statistics are sobering: • One in nine men will be diagnosed with prostate cancer;• In 2011, 37,000 new cases of the disease were diagnosed;• Half of all men will be diagnosed with cancer in their lifetime.

Technology Centers Designed to Connect Global Operations

Employees Grow Mustaches to Grow Awareness of Men’s Health Peabody Energy’s Program Helps Maximize the Personal Contributions of Employees Around the World

Adds North Goonyella Mine Development Superintendent Wouter Niehaus: “It is not always easy to openly discuss men’s health issues. However, with the fur on the top lip, most people know by now that November is mustache season. Topics such as prostate cancer and depression are brought into the open.”

Since beginning in Melbourne, Australia, Movember has grown to become a global phenomenon with participation surpassing 1.1 million people. So what does Movember hold for Peabody in 2012? London-based Manager of Coal Operations Brandon Summerford has some ideas: “What I would like to see next year is a global mobilization in Movember, with awareness driven by every Peabody office around the world.”

Learn more about Movember at http://movember.com and more about Peabody Energy’s Matching Gifts Program at https://www.easymatch.com/PeabodyEnergy.

Watts uP

Peabody’s Illinois Basin Coal Powers Super Bowl

Coal from Peabody Energy’s Viking and Air Quality mines made Super Bowl XLVI possible. These operations shipped coal to Indiana Power and Light’s Harding Street Station that fueled the stadium’s bright lights, big screens and sophisticated half-time show, as well as the nearby festivities and surrounding hotels and restaurants. In January, the Viking Mine shipped 15,000 tons of coal and Air Quality shipped 7,500 tons to the station.

Viking and Air Quality Mine coal powers the Indianapolis home of the 2012 Super Bowl.

Peabody Energy played a pivotal role in attracting leaders from the Xinjiang Uyghur Autonomous Region and the Chinese government to Missouri. The delegation embarked on export and investment agreements and a sister-state partnership, formalized in late 2011 and April 2012 signing ceremonies attended by Missouri Gov. Jay Nixon. He is pictured here with his wife, Georganne, greeting Xu Bin, Xinjiang Uyghur deputy secretary-general. Peabody and the Government of the Xinjiang Uyghur Autonomous Region together are pursuing development of a state-of-the-art 50 million-ton-per-year surface mine that would operate over multiple decades.

Peabody Operations, Individuals Earn Safety Honors

Three employees at the Twentymile Mine in Colorado have been recognized as among the safest in the state. Each earned Colorado Mining Association 2011 Excellence in Safety awards after working more than 30 years free of an incident requiring missed work. They include: Glen Aitken in surface operations, Van Austin, who works underground on belt conveyors, and Kevin Deatherage, who works in the electrical department. Twentymile also earned the 2011 Safety Innovation Safety Award. The awards are presented each March at the National Western Mining conference.

Congratulations also go to Peabody Energy’s Viking Mine and Francisco Mine Preparation Plant in the Midwest for earning recognition from the U.S. Department of Labor as Sentinels of Safety Award finalists following exceptional safety performance in calendar year 2010.

Peabody’s London office teammates, pictured at right, joined employees and contractors on teams at the company’s Brisbane offices as well as at mines including Coppabella, Metropolitan, Moorvale, Wambo, Wilpinjong and North Goonyella, at left, for Movember.

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Southwest Operations Partner to Improve Navajo Roads

Peabody Energy is helping pave the way for more accessible transportation for Navajo communities in the U.S. Southwest. Through a partnership called the Red Dog Graveling Project and with funding from multiple sources, the company is improving the condition of roads that were impassible in previous winters.

Peabody is providing access to the raw materials needed to weatherize the roads and allowing road crews to fuel their trucks at no cost. Employees and contractors also help clear the roads after significant snowfalls. Peabody has partnered with Navajo County, the Bureau of Indian Affairs, the Navajo Department of Transportation, area school districts, the Navajo Engineering and Construction Authority and multiple chapters within the Navajo reservation. The group works closely with local chapters and school districts on road improvements.

“Many roads become inaccessible after severe weather,” says Walter Begay, Navajo Tribal Liaison for Peabody’s Western operations. “The partnership helps to ensure that the main routes are safe for school buses, local residents and Peabody employees who travel to work each day in the area.”

The company’s participation has earned praise at the highest levels, including recognition from the Navajo County Board of Supervisors, Navajo County Sheriff Kelly “K.C.” Clark and Navajo County School Superintendent Linda Morrow.

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Ereen One Year Later: Ancient Grazing Land Blooms AgainMore than a year has passed since a Peabody

Energy joint venture and a local workforce made history by successfully completing Mongolia’s first coal mine restoration project at Ereen, a former mine the company acquired. Since then, the land has bloomed, says Arshad Sayed, Peabody Energy President of Mongolia and India.

“Mongolians have a deep respect for the land, and the nation’s leaders are pursuing major priorities: environmental protection, reclamation and restoring land to traditional uses,” he explains.

The nation of high rolling steppes and piercing blue sky has housed generations of herders who maintain a traditional lifestyle. At the same time, Mongolia is opening to outside investment in its bountiful resources. Mongolian leaders seek greater economic development and energy independence through mining and other enterprises. Partners like Peabody provide a record of balancing resource development and environmental needs.

Prosperity for Land and People Arshad points to the Chuluun family, a large clan that has raised cattle, sheep, goats and horses for years around the former Ereen Mine, which is located in Saikhan soum in the Bulgan province. Generally, the family’s livestock found enough forage to endure the region’s harsh winters. Still, it was not uncommon for a few unforgiving storms to thin herds and threaten the family’s fragile livelihood.

This no longer is a concern. Peabody’s land restoration quadrupled the forage vegetation available. More than 20 native species are thriving and small mammals, birds and insects have returned.

This thriving landscape is far more capable of sustaining livestock, says Vern Pfannenstiel, Senior Manager of International Reclamation, who helped manage the project.

“Our monitoring shows indicators of a stable ecosystem,” says Vern. ”In fact, the results in the field have been so good that we began a test plot for hay production. This would extend the land’s use and provide winter forage for livestock.”

A stable, year-round water source provides another lasting benefit for the local community. Water is a scarce commodity on the Mongolian steppes. The restoration team identified a water source, installed a new well and pump and built a small insulated building to shelter the system from winter freezing. The Chuluun family now assists with care of the structure.

“The well we developed from a natural underground seep is now the cleanest source of drinking water within a 20-kilometer radius, and more than a dozen families ride horses or drive to the well each day

Ereen Restoration: An International ModelThe restoration of the former Ereen Mine has earned recognition for environmental excellence on an international stage:

• The Mongolian Mining Journal has honored Peabody Energy’s Ereen restoration project with the 2011 Best Eco Mine Award for environmental protection, recognizing a successful hay-cutting trial the first year after the site was seeded. Such swift results were applauded by Mongolian leaders.

• The General Agency for Specialized Inspection of Mongolia and the German Federal Institute for Geosciences and Natural Resources together honored the project as the “Best Reclamation of the Year.”

• Altangerel Bat-Erdene was named “Environmental Officer of the Year” by the Minerals Regulatory Authority of Mongolia.

• Mongolia’s Ministry of Nature, Environment and Tourism honored Senior Manager of International Reclamation Vern Pfannenstiel as a ‘Distinguished Environmentalist’ for his leadership to establish best scientific practices in land restoration to protect Mongolia’s environment.

The former 20-hectare Ereen Mine in the Bulgan province was restored to a productive pasture that ultimately will be used for traditional livestock grazing or hay production. The forage in the seeded areas is more than four times that of the adjacent native lands.

to fill up their water jugs,” says Eric Robeck, Senior Manager – International Exploration and Geology who formerly worked with Peabody’s joint venture in Mongolia with oversight of the project. “In this way, it has become a second community center where people who normally live far apart can share news and pool resources.”

Another local resident, Amgalan, is the site’s full-time caretaker, maintaining structures and monitoring weather data until the site is well established. He draws extra income to support his children’s education and is developing his own computer skills.

A Sustained Community Benefit

Returning this ancient land to productive grazing pasture is only part of Peabody’s legacy in Mongolia. “Ereen has been more than a reclamation project; it’s been a model public-private partnership and a basis for continuing education about land reclamation,” says Vern.

Graduate students from the Mongolian Agricultural University are conducting research at the site, and plans are under way to bring Mongolian students to the United States for studies. Peabody’s proven track record has also led to an evolving partnership with the Nature Conservancy in Mongolia, which is spearheading a baseline land study in the Gobi Desert.

One year after the main restoration work at Ereen was completed, the project’s impact can be seen in the land, the health and performance of the vegetation, and the welfare of the people who depend on it.

“We have never seen anything like this in our country,” said B. Altansukh, of the Mongolian Ministry of Mineral Resources and Energy. “This is a benchmark for the future, an example others will have to follow.”

“Ereen has been more than a reclamation project; it’s been a

model public-private partnership and a basis for continuing

education about land reclamation.”

Vern Pfannenstiel,Peabody Energy Senior Manager of

International Reclamation

Restoration at the former mine site yielded a successful hay cutting trial a year after seeding. The site is now four times more productive than native lands.