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UNITED STATES SECURITIES AND
    EXCHANGE COMMISSION
 Washington, D.C.
    20549
    Form 10-K
    (Mark One)þ

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934.For the fiscal year ended
    December 31, 2007;ORo

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the transition period
    fromto   Commission file number:
    001-32723
    CNX GAS CORPORATION
 (Exact name of registrant as
    specified in its charter)
    Delaware

20-3170639(State or Other Jurisdiction
    of
    Incorporation or Organization)

(I.R.S. Employer
    Identification No.)  5 Penn Center West, Suite 401
 Pittsburgh, PA
    15276-0102
 (412) 200-6700
 (Address, including zip code,
    and telephone number,
 including area code, of
    registrants principal executive offices)
    Securities registered pursuant to Section 12(b) of the
    Act:
  Title of Each Class

Name of Each Exchange on Which RegisteredCommon Stock ($.01 par value)

New York Stock Exchange  No securities are registered pursuant to Section 12(g)
    of the Act.
    þ o
  o þ
  þ o
  Regulation S-K Form 10-K Form 10-K. o
    Large accelerated
    filer þ

Accelerated
    filer o

Non-accelerated
    filer o

Smaller reporting
    company o(Do not check if a smaller reporting company)   Rule 12b-2) o þ
      DOCUMENTS INCORPORATED BY REFERENCE:




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##### 





TABLE OF
    CONTENTS
   
 PagePART IItem 1.


Business


4Item 1A.


Risk Factors


20Item 1B.


Unresolved Staff Comments


31Item 2.


Properties


31Item 3.


Legal Proceedings


31Item 4.


Submission of Matters to a Vote of Security
    Holders


31PART IIItem 5.


Market for Registrants Common Equity,
    Related Stockholder Matters and Issuer Purchases of Equity
    Securities


31Item 6.


Selected Financial Data


34Item 7.


Managements Discussion and Analysis of
    Financial Condition and Results of Operations


37Item 7A.


Quantitative and Qualitative Disclosures About
    Market Risk


55Item 8.


Financial Statements and Supplementary Data


57Item 9.


Changes in and Disagreements with Accountants on
    Accounting and Financial Disclosures


98Item 9A.


Controls and Procedures


98Item 9B.


Other Information


98PART IIIItem 10.


Directors and Executive Officers of the
    Registrant


99Item 11.


Executive Compensation


100Item 12.


Security Ownership of Certain Beneficial Owners
    and Management


100Item 13.


Certain Relationships and Related Transactions


101Item 14.


Principal Accounting Fees and Services


101PART IVItem 15.


Exhibits and Financial Statement Schedules


101SIGNATURES


102EX-10.45EX-23.1EX-23.2EX-23.3EX-31.1EX-31.2EX-32.1ex-32.2   2




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FORWARD-LOOKING
    STATEMENTS
  Form 10-K Form 10-K Form 10-K Form 10-K;
  
    our business strategy;
    our financial position, cash flow and liquidity;
    declines in the prices we receive for our gas affecting our
    operating results and cash flow;
    uncertainties in estimating our gas reserves and replacing our
    gas reserves;
    uncertainties in exploring for and producing gas;
    our inability to obtain additional financing necessary in order
    to fund our operations, capital expenditures and to meet our
    other obligations;
    disruptions to, capacity constraints in or other limitations on
    the pipeline systems which deliver our gas;
    the availability of personnel and equipment, including our
    inability to retain and attract key personnel;
    increased costs;
    the effects of government regulation and permitting and other
    legal requirements;
    legal uncertainties regarding the ownership of the coalbed
    methane estate, and costs associated with perfecting title for
    gas rights in some of our properties;
    litigation concerning real property rights, intellectual
    property rights, royalty calculations and other matters;
    our relationships and arrangements with CONSOL Energy; and
    other factors discussed under Risk Factors. 3




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PART I  ITEM 1.
    BUSINESS  Except as otherwise noted or unless the context otherwise
    requires, (i) the information in this Annual Report on
    Form 10-K
    gives effect to the contribution to CNX Gas of the CONSOL Energy
    gas business effective as of August 8, 2005, (ii) CNX
    Gas refers, with respect to any date prior to the effective date
    of that contribution, to the CONSOL Energy gas business and,
    with respect to any date on or subsequent to the effective date
    of the contribution, to CNX Gas and our subsidiaries,
    (iii) CONSOL Energy refers to CONSOL Energy
    Inc. and its subsidiaries other than CNX Gas and the companies
    which conducted CONSOL Energys gas business, and
    (iv) reserve and operating data are as of December 31,
    2007 unless otherwise indicated. The estimates of our proved
    reserves as of December 31, 2007, 2006, and 2005 included
    in this Annual Report are based on reserve reports prepared by
    Schlumberger Data and Consulting Services. The estimates of our
    proved reserves as of December 31, 2004 and 2003 (set forth
    in Item 6, Selected Financial Data  Other
    Financial Data) are based on reserve reports prepared by
    Ralph E. Davis Associates, Inc. and Schlumberger Data and
    Consulting Services. Unless otherwise noted, we discuss
    production, per unit revenue and per unit costs net of any
    royalty owners interest. With respect to production and
    reserves, we use the word net to indicate when a
    number does not include the royalty owners interest. With
    respect to acres, we use the word net to describe
    our aggregate fractional interest in property that we control by
    deed or lease. With the exception of earnings per share data, we
    discuss dollars in thousands throughout this
    Form 10-K.
    Financial information concerning industry segments, as defined
    by accounting principles generally accepted in the United States
    of America, for the twelve months ended December 31, 2007,
    2006 and 2005 is included in Note 18 to the Consolidated
    Financial Statements included as Item 8 in Part II of
    this Annual Report on
    Form 10-K.
  General
  PV-10
  History
    of CNX Gas
     4




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Our
    Relationship with CONSOL Energy
        Coordination
    with Mining Activities
      Gas
    Operations
   5




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##### Table of Contents



Areas
    of Operation
    
    first, in Central Appalachia, Virginia Operations CBM, our
    traditional and largest area of operation, where we have
    typically produced CBM from vertical wells which we drill ahead
    of mining and gob gas wells;
    second, in Northern Appalachia, the Mountaineer CBM play in
    northwestern West Virginia and southwestern Pennsylvania where
    our first major drilling program using vertical-to-horizontal
    well designs is into full scale development;
    third, in Northern Appalachia, the Nittany CBM play in central
    Pennsylvania where we have substantial holdings and transitioned
    initial exploratory testing activities into full scale
    development;
    fourth, in the Illinois Basin, Cardinal, the New Albany shale
    play in western Kentucky, Indiana and Illinois which has
    economic potential where we are in the midst of exploratory
    testing activities; and
    last, in addition to the above areas, we believe we have
    Appalachian shale potential in the Marcellus, Huron, and
    Chattanooga shales. Additional potential exists in the Trenton
    Black River formation which is thought to underlie nearly all of
    the Appalachian shales. We will continue to evaluate our acreage
    position in these areas, with the commencement of an exploration
    program in 2008.  Central
    Appalachia
  Virginia
    Operations CBM
       6




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Virginia
    Operations Shale and Tight Sands
    Tennessee
      Northern
    Appalachia
  Mountaineer
    CBM
   7




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Nittany
    CBM
    Marcellus
    Shale
    Shallow
    Oil
    Others
  Cardinal
    Shale
  50-300 feet
  Illinois
    Basin CBM
   8




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##### Table of Contents



Other
    Acreage
    Summary
    of Properties as of December 31, 2007
  Central


NorthernAppalachia


Appalachia


Other


TotalEstimated Net Proved Reserves (Bcfe)


1,242.4



87.3



13.8



1,343.5Percent Developed


48.8
%


58.1
%


100
%


50.0
%Net Producing Wells


2,650



195



144



2,989Net Proved Developed CBM Acres


134,968



52,760







187,728Net Proved Undeveloped CBM Acres


33,370



35,980







69,350Net Unproved CBM Acres(1)


425,431



934,822



749,902



2,110,155Total Net CBM Acres


593,769



1,023,562



749,902



2,367,233Net Proved Developed Oil & Gas Acres


6,104







34,737



40,841Net Proved Undeveloped Oil & Gas Acres














Net Unproved Oil & Gas Acres(1)


314,959



177,255



358,414



850,628Total Net Oil & Gas Acres


321,063



177,255



393,151



891,469   (1)
    
    Includes areas leased to others or participation interests in
    third party wells as well as small acreage in other areas.  Drilling
    Development
    Wells (Net)
  For the Twelve Months Ended December 31,2007


2006


2005Wells


Wells


WellsCentral Appalachia


294



253



176Northern Appalachia


76



19



8Total


370



272



184  9




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Exploratory
    Wells (Net)
  As of December 31,2007


2006


2005Producing


Dry


Still Eval.


Producing


Dry


Still Eval.


Producing


Dry


Still Eval.Central Appalachia


3



0



0



2



0



0



2



0



0Northern Appalachia


0



0



0



0



0



2



13



0



0Other


1



0



5



0



0



0



0



0



0Total


4



0



5



2



0



2



15



0



0   Summary
    of Other Operating Data
  Production
    For the Twelve MonthsEnded December 31,2007

2006

2005Total Produced (Mmcf)


58,249



56,135



48,390   Average
    Sales Prices and Lifting Costs
    For the Twelve MonthsEnded December 31,2007

2006

2005Average Gas Sales Price Including Effects of Financial
    Settlements (per Mcf)

$
7.20


$
7.04


$
5.90Average Lifting Cost (per Mcf)

$
0.68


$
0.60


$
0.64   Productive
    Wells and Acreage
    Gross


Net(1)Producing Wells


3,800



2,989Proved Developed Acreage


230,545



228,569Proved Undeveloped Acreage


71,434



69,350Unproven Acreage


3,505,970



2,960,783Total Acreage


3,807,949



3,258,702  10




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##### Table of Contents



(1)
    
    Net acres do not include acreage attributable to the working
    interests of our principal joint venture partners and the
    portions of certain proved developed acreage attributable to
    property we have leased to third-party producers. Additional
    adjustments (either increases or decreases) may be required as
    we further develop title to and further confirm our rights with
    respect to our various properties in anticipation of
    development. We believe that our assumptions and methodology in
    this regard are reasonable.  Sales
        Reserves
  Regulation S-X.
  Net Reserves (Mmcfe)As of December 31,2007


2006


2005Consolidated





Consolidated





ConsolidatedOperations


Affiliates


Operations


Affiliates


Operations


AffiliatesEstimated proved developed reserves


667,726



3,584



609,700



2,200



549,574



2,672Estimated proved undeveloped reserves


672,183







653,593







578,150



Total estimated proved developed and undeveloped reserves


1,339,909



3,584



1,263,293



2,200



1,127,724



2,672  11




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Discounted
    Future Net Cash Flows
    Discounted Future Net Cash FlowsAs of December 31,2007


2006


2005(Dollars in thousands)Future net cash flows (net of tax)

$
3,609,195


$
2,483,887


$
5,149,938Total PV-10
    measure of pre tax discounted future net cash flows(1)

$
2,287,427


$
1,499,664


$
3,051,866Total standardized measure of after tax discounted future net
    cash flows

$
1,389,540


$
934,891


$
1,870,794   (1)
    
    We calculate our
    PV-10 value
    in accordance with the following table. Management believes that
    the presentation of the non-GAAP financial measure of
    PV-10
    provides useful information to investors because it is widely
    used by professional analysts and sophisticated investors in
    evaluating oil and gas companies. Because many factors that are
    unique to each individual company impact the amount of future
    income taxes estimated to be paid, the use of a pre-tax measure
    is valuable when comparing companies based on reserves.
    PV-10 is not
    a measure of financial or operating performance under GAAP.
    PV-10 should
    not be considered as an alternative to the standardized measure
    as defined under GAAP. We have included a reconciliation to the
    most directly comparable GAAP measure  after-tax
    discounted future net cash flows.  Reconciliation
    of PV-10 to
    Standardized Measure
  As of December 31,2007


2006


2005(Dollars in thousands)Future cash inflows

$
9,509,665


$
7,105,265


$
11,675,551Future Production Costs


(3,004,619
)


(2,568,731
)


(2,852,033
)Future Development Costs (including abandonments)


(636,436
)


(552,114
)


(422,315
)Future net cash flows (pre-tax)


5,868,610



3,984,420



8,401,20310% discount factor


(3,581,183
)


(2,484,756
)


(5,349,337
)PV-10
    (Non-GAAP measure)


2,287,427



1,499,664



3,051,866Undiscounted Income Taxes


(2,259,415
)


(1,500,533
)


(3,251,265
)10% discount factor


1,361,528



935,760



2,070,193Discounted Income Taxes


(897,887
)


(564,773
)


(1,181,072
)Standardized GAAP measure

$
1,389,540


$
934,891


$
1,870,794   Competition
    Employee
    and Labor Relations
   12




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Available
    Information
  Form 10-K, Form 10-Q, Form 8-K, 1-800-SEC-0330 www.sec.gov.
  www.cnxgas.com Form 10-K
  15276-0102. Form 8-K
  Regulations
    Environmental
    Regulation of Gas Operations
  and/or
 13




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
    the Clean Air Act;
    the Clean Water Act;
    the Toxic Substances Control Act;
    the Endangered Species Act;
    the Resource Conservation and Recovery Act; and
    the Emergency Planning and Community Right-to-Know Act;    and/or
   14




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Federal
    Regulation of the Sale and Transportation of Gas
            State
    Regulation of Gas Operations  United
    States
   15




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and/or
  Ownership
    of Mineral Rights
    and/or
      Pennsylvania
  e.g
  Virginia
   16




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##### Table of Contents



West
    Virginia
    e.g.
    Other
    States
   17




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GLOSSARY
    OF NATURAL GAS AND COAL TERMS
    Appalachian Basin.
  Bcf.
  Bcfe.
  Btu or British Thermal Unit.
  CBM.
  Central Appalachia.
  Coal Seam.
  Completion.
  Developed acreage.
  Development well.
  Dry hole.
  Exploitation.
  Exploratory well.
  Farm-in or farm-out.
  Field. and/or
  Frac well.
  Gathering system.
  Gob.
  Gob gas.
 18




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Gross acres or gross wells.
  Mcf.
  Mcfe.
  MMBtu.
  Mmcf.
  Mmcfe.
  Net acres or net wells.
  Northern Appalachia.
  NYMEX.
  Panel.
  Pay zone.
  Pipeline imbalance (imbalance).
  PV-10 or
    present value of estimated future net
    revenues.
  Productive well.
  Proved developed reserves.
  Proved reserves.
  Proved undeveloped reserves.
  Reserve life index.
 19




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Reservoir. and/or
  Shut in.
  Tcfe.
  Undeveloped acreage.
  Vertical-to-horizontal well.
  Working interest.
  EXECUTIVE
    OFFICERS OF THE COMPANY
  Regulation S-K).
  ITEM 1A.
    RISK
    FACTORS    General
    Risk Factors
  Natural
    gas prices are volatile, and a decline in natural gas prices
    would significantly affect our financial results and impede our
    growth.
      
    the domestic and foreign supply of natural gas;
    the price of foreign imports;
    overall domestic and global economic conditions;
    the consumption pattern of industrial consumers, electricity
    generators and residential users;
    weather conditions;
    technological advances affecting energy consumption; 20




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##### Table of Contents




    domestic and foreign governmental regulations;
    proximity and capacity of gas pipelines and other transportation
    facilities; and
    the price and availability of alternative fuels.    
    our cash flow would be reduced, decreasing funds available for
    capital expenditures employed to replace reserves or increase
    production; and
    access to other sources of capital, such as equity or long-term
    debt markets, could be severely limited or unavailable.    We
    face uncertainties in estimating proved recoverable gas
    reserves, and inaccuracies in our estimates could result in
    lower than expected reserve quantities and a lower present value
    of our reserves.
      
    geological conditions;
    changes in governmental regulations and taxation;
    assumptions governing future prices;
    the amount and timing of actual production;
    future operating costs; and
    capital costs of drilling new wells. 21




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PV-10
  Unless
    we replace our natural gas reserves, our reserves and production
    will decline, which would adversely affect our business,
    financial condition, results of operations and cash
    flows.
    Our
    exploration and development activities may not be commercially
    successful.
    
    unexpected drilling conditions;
    title problems;
    pressure or irregularities in geologic formations;
    equipment failures or repairs;
    fires or other accidents;
    adverse weather conditions;
    reductions in natural gas prices;
    pipeline ruptures; and
    unavailability or high cost of drilling rigs, other field
    services and equipment.    We
    have a limited operating history in certain of our operating
    areas, and our increased focus on new development projects in
    these and other unexplored areas increases the risks inherent in
    our gas and oil activities.
   22




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Our
    business depends on transportation facilities owned by others.
    Disruption of, capacity constraints in, or proximity to pipeline
    systems could limit sales of our gas.
    Increased
    industry activity may create shortages of field services,
    equipment and personnel, which may increase our costs and may
    limit our ability to drill and produce from our natural gas
    properties
    We
    operate in a highly competitive environment and many of our
    competitors have greater resources than we do.
     23




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Acquisitions
    are subject to the risks and uncertainties of evaluating
    reserves and potential liabilities and may be disruptive and
    difficult to integrate into our business
        The
    coal shale and other strata from which we produce gas frequently
    contain water and the gas often contains impurities, both of
    which may hamper our ability to produce gas in commercial
    quantities or economically.
    We may
    be unable to retain our existing senior management team and/or
    our key personnel who have expertise in coalbed methane
    extraction and our failure to continue to attract qualified new
    personnel could adversely affect our business.
  and/or
 24




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We are
    party to, and may in the future become party to, joint ventures
    and other arrangements with third parties that may impact our
    operations and our financial performance.
  and/or and/or
  Government
    laws, regulations and other legal requirements relating to
    protection of the environment, health and safety matters and
    others that govern our and CONSOL Energys businesses
    increase our costs and may restrict our
    operations.
  clean-up clean-up
    We
    must obtain governmental permits and approvals for drilling
    operations, which can be a costly and time consuming process and
    result in restrictions on our operations.
   25




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We may
    incur additional costs and delays to produce gas because we have
    to acquire additional property rights to perfect our title to
    the gas estate.
        Other
    persons could have ownership rights in our advanced extraction
    techniques which could force us to cease using those techniques
    or pay royalties.
   26




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We
    must coordinate some of our gas production activities with coal
    mining activities in the same area, which could adversely affect
    our operations and financial results.
    Currently
    the majority of our producing properties are located in three
    counties in southwestern Virginia, making us vulnerable to risks
    associated with having our production concentrated in one
    area.
    We do
    not insure against all potential operating risks. We may incur
    substantial losses and be subject to substantial liability
    claims as a result of our natural gas operations.
    Proposed
    legislation that seeks to regulate greenhouse gas emissions
    could increase our costs and reduce the value of our
    assets.
     27




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Our
    hedging activities may prevent us from benefiting from price
    increases and may expose us to other risks.
      
    our production is less than expected; or
    the counterparties to our futures contracts fail to perform the
    contracts.    Our
    future level of indebtedness and the terms of our financing
    arrangements may adversely affect operations and limit our
    growth.
      
    requiring us to dedicate a portion of our cash flow from
    operations to required payments, thereby reducing the
    availability of cash flow for working capital, capital
    expenditures and other general business activities;
    limiting our ability to obtain additional financing in the
    future for working capital, capital expenditures, acquisitions
    and general corporate and other activities;
    making us vulnerable to increases in interest rates, because our
    revolving credit facility provides for variable rates of
    interest;
    limiting our flexibility in planning for, or reacting to,
    changes in our business and the industry in which we
    operate; and
    reducing our ability to successfully withstand a downturn in our
    business or the economy generally.   28




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Risks
    Relating to Our Relationship with CONSOL Energy
  Our
    principal stockholder, CONSOL Energy, is in a position to affect
    our ongoing operations, corporate transactions and other
    matters, and some of our directors also serve on its board of
    directors
    and/or are
    employees of CONSOL Energy, creating potential conflicts of
    interest.
    
    the election and removal of directors;
    mergers or other business combinations involving us;
    future issuances of our common stock or other
    securities; and
    amendments to our certificate of incorporation and bylaws.    and/or
  Potential
    conflicts may arise between us and CONSOL Energy that may not be
    resolved in our favor.
    Our
    intercompany agreements with CONSOL Energy are not the result of
    arms-length negotiations.
   29




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Our
    agreements with CONSOL Energy may limit our ability to obtain
    capital, make acquisitions or effect other business
    combinations.
    Our
    prior and continuing relationship with CONSOL Energy exposes us
    to risks attributable to CONSOL Energys
    businesses.
        CONSOL
    Energy has announced its intention to make an offer to the
    acquire all of the outstanding shares of CNX Gas that CONSOL
    Energy does not already own.
   30




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We may
    lose certain synergistic advantages if CONSOL divests its
    ownership stake.
    ITEM 1B.
    UNRESOLVED
    STAFF COMMENTS    ITEM 2.
    PROPERTIES  15276-0102.
  ITEM 3.
    LEGAL
    PROCEEDINGS  Form 10-K
  ITEM 4.
    SUBMISSION
    OF MATTERS TO A VOTE OF SECURITY HOLDERS   PART II  ITEM 5.
    MARKET
    FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS
    AND ISSUER PURCHASES OF EQUITY SECURITIES  Form S-1.
    2007


2006High


Low


High


LowMarch 31

$
28.69


$
22.90


$
26.50


$
20.13June 30

$
32.69


$
27.14


$
32.99


$
24.50September 30

$
32.24


$
23.47


$
30.10


$
21.84December 31

$
33.20


$
28.50


$
28.47


$
22.12    31




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##### Table of Contents



STOCK
    PERFORMANCE GRAPH
      COMPARISON
    OF CUMULATIVE TOTAL RETURN
  
  Base Period


Quarter EndingCompany/Index

Jan-19-06


Mar-06


Jun-06


Sep-06


Dec-06


Mar-07


Jun-07


Sep-07


Dec-07CNX Gas Corporation


100



115.56



133.33



102.98



113.33



125.91



136.00



127.87



142.00S&P MidCap 400 Index


100



102.89



99.66



98.58



105.47



111.58



118.10



117.08



113.88S&P Oil & Gas Exploration &
    Production


100



93.20



96.25



92.46



95.84



102.53



115.69



121.28



138.41   Form 10-K
      Recent
    Sales of Unregistered Securities
     32




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one-time
 33




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ITEM 6.
    SELECTED
    FINANCIAL DATA    CNX GAS
    CORPORATION AND SUBSIDIARIES
  CONSOLIDATED
    STATEMENTS OF INCOME
  For the Twelve Months Ended December 31,STATEMENTS OF INCOME DATA

2007


2006


2005


2004


2003(Dollars in thousands)RESULTS OF OPERATIONSOutside Sales

$
404,835


$
385,056


$
277,031


$
214,721


$
145,884Related Party Sales


11,618



8,490



6,052



22,036



32,572Royalty Interest Gas Sales


46,586



51,054



45,351



41,858



32,442Purchased Gas Sales


7,628



43,973



275,148



112,005



Other Income


6,641



25,286



9,859



6,916



4,485TOTAL REVENUE AND OTHER INCOME


477,308



513,859



613,441



397,536



215,383Lifting Costs


38,721



33,357



30,399



27,250



22,792Gathering and Compression Costs


61,798



58,102



43,903



40,422



31,997Royalty Interest Gas Costs


40,011



41,998



36,641



32,914



24,200Purchased Gas Costs


7,162



44,843



278,720



113,063



Other


79



1,082



2,878



3,009



10,788General and Administrative


54,825



39,168



19,129



15,303



11,995Depreciation, Depletion and Amortization


48,961



37,999



35,039



32,889



33,600Interest Expense


5,606



870



14







TOTAL COSTS AND EXPENSES


257,163



257,419



446,723



264,850



135,372Earnings Before Income Taxes, Minority Interest, and Cumulative
    Effect of Change in Accounting Principle


220,145



256,440



166,718



132,686



80,011Minority Interest


494















Earnings Before Income Taxes, and Cumulative Effect of Change in
    Accounting Principle


220,639



256,440



166,718



132,686



80,011Income Taxes


84,961



96,573



64,550



51,898



31,202Earnings Before Cumulative Effect of Change in Accounting
    Principle


135,678



159,867



102,168



80,788



48,809Cumulative Effect of Change in Accounting for Asset Retirement
    Obligations (Net of Tax Impact of $1,879)


















2,905NET INCOME

$
135,678


$
159,867


$
102,168


$
80,788


$
51,714 34




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##### Table of Contents



For the Twelve Months Ended December 31,STATEMENTS OF INCOME DATA

2007


2006


2005


2004


2003(Dollars in thousands)Earnings Per Share Before Cumulative Effect of Change in
    Accounting PrincipleBasic

$
0.90


$
1.06


$
0.76


$
0.66


$
0.40Diluted

$
0.90


$
1.06


$
0.76


$
0.66


$
0.40Earnings Per Share from Net Income:Basic

$
0.90


$
1.06


$
0.76


$
0.66


$
0.42Diluted

$
0.90


$
1.06


$
0.76


$
0.66


$
0.42Weighted Average Number of Common Shares Outstanding:Basic


150,886,433



150,845,518



134,071,334



122,896,667



122,896,667Dilutive


151,133,520



151,017,456



134,137,219



122,988,359



122,988,359   As of December 31,BALANCE SHEETS DATA

2007


2006


2005


2004


2003(Dollars in thousands)Working Capital (Deficiency) (Unaudited)

$
25,303


$
115,824


$
3,720


$
(35,030
)

$
(7,971
)Total Assets


1,380,703



1,155,001



859,167



718,859



664,635Long Term Debt (Including current portion)


72,768



66,470











Total Deferred Credits and Other Liabilities


227,153



153,977



109,226



205,614



170,520Stockholders Equity


1,023,237



880,215



679,472



462,556



464,232   For the Twelve MonthsEnded December 31,CASH FLOW STATEMENTS DATA

2007


2006


2005


2004


2003(Dollars in thousands)Net Cash Provided by Operating Activities

$
272,448


$
243,569


$
144,997


$
175,350


$
143,133Net Cash Used in Investing Activities


(354,227
)


(156,020
)


(108,287
)


(93,114
)


(90,605
)Net Cash Provided by (Used in) Financing Activities


6,654



(449
)


(16,640
)


(82,237
)


(52,526
)   For the Twelve MonthsEnded December 31,OTHER OPERATING DATA

2007


2006


2005


2004


2003(Unaudited)Net Sales Volumes (Bcf)(1)


58.25



56.14



48.39



48.56



44.46Average Sales Price Including Effects of Financial Settlements
    ($ per Mcf)(1)(2)

$
7.20


$
7.04


$
5.90


$
4.90


$
4.03Total Average Costs ($ Per Mcf)(1)

$
3.55


$
3.02


$
2.72


$
2.45


$
2.43Net Estimated Proved Reserves (Bcfe)(1)(3)


1,343



1,265



1,130



1,045



1,004   For the Twelve MonthsEnded December 31,OTHER FINANCIAL DATA

2007


2006


2005


2004


2003(Dollars in thousands)Capital Expenditures(4)

$
357,199


$
154,243


$
110,752


$
89,753


$
83,869EBIT(5) (Unaudited)


222,452



253,857



166,314



132,686



80,011EBITDA(5) (Unaudited)


271,413



291,856



201,353



165,575



113,611  35




---



##### Table of Contents



(1)
    
    For entities that are not wholly owned but in which CNX Gas owns
    a working interest, includes a percentage of their net
    production, sales or reserves equal to the CNX Gas percentage
    equity ownership. Knox Energy is included in the equity earnings
    data in 2007, 2006, 2005, 2004 and 2003. Sales of gas produced
    by equity affiliates were 0.32 Bcf for the twelve months
    ended December 31, 2007, 0.22 Bcf for the twelve
    months ended December 2006, 0.23 Bcf for the twelve months
    ended December 31, 2005, 0.20 Bcf for the twelve
    months ended December 31, 2004, and 0.08 Bcf for the
    twelve months ended December 31, 2003.(2)
    
    Represents average net sales price including the effect of
    derivative transactions.(3)
    
    Represents proved developed and proved undeveloped gas reserves
    at period end for total operations including equity affiliates,
    of 3.6 Bcfe.(4)
    
    Capital expenditures for 2007 include those related to Knox
    Energy.(5)
    
    EBIT is defined as earnings before deducting net interest
    expense (interest expense less interest income) and income
    taxes. EBITDA is defined as earnings before deducting net
    interest expense (interest expense less interest income), income
    taxes and depreciation, depletion and amortization. Although
    EBIT and EBITDA are not measures of performance calculated in
    accordance with accounting principles generally accepted in the
    United States of America, management believes that they are
    useful to an investor in evaluating CNX Gas because they are
    used as measures to evaluate a companys operating
    performance before debt expense and cash flow. EBIT and EBITDA
    do not purport to represent cash generated by operating
    activities and should not be considered in isolation or as
    substitute for measures of performance in accordance with
    accounting principles generally accepted in the United States of
    America. In addition, because EBIT and EBITDA are not calculated
    identically by all companies, the presentation here may not be
    comparable to other similarly titled measures of other
    companies. Managements discretionary use of funds depicted
    by EBIT and EBITDA may be limited by working capital, debt
    service and capital expenditure requirements, and by
    restrictions related to legal requirements, commitments and
    uncertainties.    For the Twelve MonthsEnded December 31,2007


2006


2005


2004


2003(Dollars in thousands)Net Income

$
135,678


$
159,867


$
102,168


$
80,788


$
51,714Add: Interest Expense


5,606



870



14







Less: Interest Income


3,793



3,453



418







Less: Cumulative Effect of Changes in Accounting for Asset
    Retirement Obligations, Net of Income Taxes of $1,879


















2,905Add: Income Tax Expense


84,961



96,573



64,550



51,898



31,202Earnings Before Net Interest and Taxes (EBIT)


222,452



253,857



166,314



132,686



80,011Add: Depreciation, Depletion and Amortization


48,961



37,999



35,039



32,889



33,600Earnings Before Net Interest, Taxes and Depreciation, Depletion
    and Amortization (EBITDA)

$
271,413


$
291,856


$
201,353


$
165,575


$
113,611  36




---



##### Table of Contents



ITEM 7.
    MANAGEMENTS
    DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
    OPERATIONS  The following discussion and analysis should be read in
    conjunction with Selected Consolidated Financial and Other
    Data and our consolidated financial statements and related
    notes appearing elsewhere in this Annual Report. This Annual
    Report on
    Form 10-K
    contains forward-looking statements within the meaning of the
    Private Securities Litigation Reform Act of 1995. See
    PART I  Forward Looking Statements
    and
    PART I-Item 1A
    Risk Factors.
  Overview
            Significant
    Developments
    
    completed another year with no employee-related lost time
    accidents. We have accumulated over 2.7 million man hours
    without a lost time accident;
    drilled a record 294 wells in our Virginia CBM operations;
    expanded operations in our Mountaineer CBM play in Northern
    Appalachia with a record 62 new wells drilled in 2007;
    drilled 14 wells in Nittany, our CBM play in Central
    Pennsylvania and the first entirely new step-out opportunity for
    CNX Gas since its inception in 2005;
    began exploratory drilling in Cardinal, a New Albany shale play
    in the Illinois Basin;
    increased our 2007 production by 3.8% from 2006 to 58 Bcf,
    despite a roof collapse at CONSOL Energys Buchanan Mine;
    increased our proved reserve base by replacing 234% of our
    production;
    generated net income of $135,678;
    maintained our low cost structure relative to our peer group; 37




---



##### Table of Contents




    continued investing in the infrastructure necessary for
    continued growth; and
    acquired additional expertise to begin a significant exploration
    program.    Outlook
           38




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##### Table of Contents



Results
    of Operations
  Twelve
    Months Ended December 31, 2007 compared with Twelve Months
    Ended December 31, 2006 (Amounts reported in
    thousands)
  Net
    Income
    Dollar


Percentage2007


2006


Variance


ChangeRevenue and Other Income:Outside Sales

$
404,835


$
385,056


$
19,779



5.1
%Related Party Sales


11,618



8,490



3,128



36.8
%Royalty Interest Gas Sales


46,586



51,054



(4,468
)


(8.8
)%Purchased Gas Sales


7,628



43,973



(36,345
)


(82.7
)%Other Income


6,641



25,286



(18,645
)


(73.7
)%Total Revenue and Other Income


477,308



513,859



(36,551
)


(7.1
)%Costs and Expenses:Lifting Costs


38,721



33,357



5,364



16.1
%Gathering and Compression Costs


61,798



58,102



3,696



6.4
%Royalty Interest Gas Costs


40,011



41,998



(1,987
)


(4.7
)%Purchased Gas Costs


7,162



44,843



(37,681
)


(84.0
)%Other


79



1,082



(1,003
)


(92.7
)%General and Administrative


54,825



39,168



15,657



40.0
%Depreciation, Depletion and Amortization


48,961



37,999



10,962



28.8
%Interest Expense


5,606



870



4,736



544.4
%Total Costs and Expenses


257,163



257,419



(256
)


(0.1
)%Earnings Before Income Taxes and Minority Interest


220,145



256,440



(36,295
)


(14.2
)%Minority Interest


494







494



100.0
%Earnings Before Income Taxes


220,639



256,440



(35,801
)


(14.0
)%Income Taxes


84,961



96,573



(11,612
)


(12.0
)%Net Income

$
135,678


$
159,867


$
(24,189
)


(15.1
)%    39




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##### Table of Contents



Revenue
    and Other Income
    Dollar


Percentage2007


2006


Variance


ChangeRevenue and Other Income:Outside Sales

$
404,835


$
385,056


$
19,779



5.1
%Related Party Sales


11,618



8,490



3,128



36.8
%Royalty Interest Gas Sales


46,586



51,054



(4,468
)


(8.8
)%Purchased Gas Sales


7,628



43,973



(36,345
)


(82.7
)%Other Income


6,641



25,286



(18,645
)


(73.7
)%Total Revenue and Other Income

$
477,308


$
513,859


$
(36,551
)


(7.1
)%     Percentage2007

2006

Variance

ChangeSales Volumes (Bcf)


57.9



55.9



2.0



3.6
%Average Sales Price (per Mcf)

$
7.19


$
7.04


$
0.15



2.1
%     Percentage2007

2006

Variance

ChangeRoyalty Interest Gas Sales Volumes (Bcf)


7.2



7.6



(0.4
)


(5.3
)%Average Sales Price (per Mcf)

$
6.44


$
6.76


$
(0.32
)


(4.7
)%     Percentage2007

2006

Variance

ChangePurchased Gas Sales Volumes (Bcf)


1.1



6.1



(5.0
)


(82.0
)%Average Sales Price (per Mcf)

$
7.19


$
7.20


$
(0. 01
)


(0.1
)%    40




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##### Table of Contents



No. 04-13 (EITF 04-13),
    Dollar


Percentage2007


2006


Variance


ChangeRoyalty Income

$



$
10,230


$
(10,230
)


(100.0
)%Business Interruption Insurance


1,600



10,165



(8,565
)


(84.3
)%Third Party Gathering Revenue


1,077



1,341



(264
)


(19.7
)%Other Miscellaneous


171



97



74



76.3
%Interest Income


3,793



3,453



340



9.8
%Total Other Income

$
6,641


$
25,286


$
(18,645
)


(73.7
)%             Costs and
    Expenses
    Dollar


Percentage2007


2006


Variance


ChangeCosts and Expenses:Lifting Costs

$
38,721


$
33,357


$
5,364



16.1
%Gathering and Compression Costs


61,798



58,102



3,696



6.4
%Royalty Interest Gas Costs


40,011



41,998



(1,987
)


(4.7
)%Purchased Gas Costs


7,162



44,843



(37,681
)


(84.0
)%Other


79



1,082



(1,003
)


(92.7
)%General and Administrative


54,825



39,168



15,657



40.0
%Depreciation, Depletion and Amortization


48,961



37,999



10,962



28.8
%Interest Expense


5,606



870



4,736



544.4
%Total Costs and Expenses

$
257,163


$
257,419


$
(256
)


(0.1
)%  41




---



##### Table of Contents



Percentage2007

2006

Variance

ChangeSales Volumes (Bcf)


57.9



55.9



2.0



3.6
%Average Lifting Costs (per Mcf)

$
0.67


$
0.60


$
0.07



11.7
%     Percentage2007

2006

Variance

ChangeSales Volumes (Bcf)


57.9



55.9



2.0



3.6
%Average Gathering and Compression Costs (per Mcf)

$
1.07


$
1.04


$
0.03



2.9
%     Percentage2007

2006

Variance

ChangeRoyalty Interest Gas Sales Volumes (Bcf)


7.2



7.6



(0.4
)


(5.3
)%Average Cost (per Mcf)

$
5.53


$
5.56


$
(0.03
)


(0.5
)%     Percentage2007

2006

Variance

ChangePurchased Gas Cost Volumes (Bcf)


1.1



6.1



(5.0
)


(82.0
)%Average Purchased Gas Costs (per Mcf)

$
6.66


$
7.34


$
(0.68
)


(9.3
)%   No. 04-13 (EITF 04-13),
    Dollar


Percentage2007


2006


Variance


ChangeExploration

$
2,253


$
2,708


$
(455
)


(16.8
)%Pipeline Imbalance






(648
)


648



100.0
%Equity in Earnings of Affiliates


(2,174
)


(978
)


(1,196
)


(122.3
)%Total Other Costs and Expenses

$
79


$
1,082


$
(1,003
)


(92.7
)%  42




---



##### Table of Contents



Dollar


Percentage2007


2006


Variance


ChangeEmployee Wages and Related Costs

$
19,255


$
16,582


$
2,673



16.1
%Professional Fees


15,621



8,879



6,742



75.9
%Short Term Incentive


5,659



4,702



957



20.4
%Stock Based Compensation


5,491



4,502



989



22.0
%Facilities


5,049



2,805



2,244



80.0
%Other


3,750



1,698



2,052



120.8
%Total

$
54,825


$
39,168


$
15,657



40.0
%               Dollar


Percentage2007


2006


Variance


ChangeProduction

$
30,945


$
24,668


$
6,277



25.4
%Gathering


18,016



13,331



4,685



35.1
%Total Depreciation, Depletion and Amortization

$
48,961


$
37,999


$
10,962



28.8
%      43




---



##### Table of Contents



Income
    Taxes
  Percentage2007


2006


Variance


ChangeEarnings Before Income Taxes

$
220,639


$
256,440


$
(35,801
)


(14.0
)%Tax Expense

$
84,961


$
96,573


$
(11,612
)


(12.0
)%Effective Income Tax Rate


38.5
%


37.7
%


0.8
%     Twelve
    Months Ended December 31, 2006 compared with Twelve Months
    Ended December 31, 2005
  (Amounts
    reported in thousands)
  Net
    Income
    Dollar


Percentage2006


2005


Variance


ChangeRevenue and Other Income:Outside Sales

$
385,056


$
277,031


$
108,025



39.0
%Related Party Sales


8,490



6,052



2,438



40.3
%Royalty Interest Gas Sales


51,054



45,351



5,703



12.6
%Purchased Gas Sales


43,973



275,148



(231,175
)


(84.0
)%Other Income


25,286



9,859



15,427



156.5
%Total Revenue and Other Income


513,859



613,441



(99,582
)


(16.2
)%Costs and Expenses:Lifting Costs


33,357



30,399



2,958



9.7
%Gathering and Compression Costs


58,102



43,903



14,199



32.3
%Royalty Interest Gas Costs


41,998



36,641



5,357



14.6
%Purchased Gas Costs


44,843



278,720



(233,877
)


(83.9
)%Other


1,082



2,878



(1,796
)


(62.4
)%General and Administrative


39,168



19,129



20,039



104.8
%Depreciation, Depletion and Amortization


37,999



35,039



2,960



8.4
%Interest Expense


870



14



856



6,114.3
%Total Costs and Expenses


257,419



446,723



(189,304
)


(42.4
)%Earnings Before Income Taxes


256,440



166,718



89,722



53.8
%Income Taxes


96,573



64,550



32,023



49.6
%Net Income

$
159,867


$
102,168


$
57,699



56.5
%    44




---



##### Table of Contents



Revenue
    and Other Income
    Dollar


Percentage2006


2005


Variance


ChangeRevenue and Other Income:Outside Sales

$
385,056


$
277,031


$
108,025



39.0
%Related Party Sales


8,490



6,052



2,438



40.3
%Royalty Interest Gas Sales


51,054



45,351



5,703



12.6
%Purchased Gas Sales


43,973



275,148



(231,175
)


(84.0
)%Other Income


25,286



9,859



15,427



156.5
%Total Revenue and Other Income

$
513,859


$
613,441


$
(99,582
)


(16.2
)%     Percentage2006

2005

Variance

ChangeSales Volumes (Bcf)


55.9



48.2



7.7



16.0
%Average Sales Price (per Mcf)

$
7.04


$
5.88


$
1.16



19.7
%     Percentage2006

2005

Variance

ChangeRoyalty Interest Gas Sales Volumes (Bcf)


7.6



6.6



1.0



15.2
%Average Sales Price (per Mcf)

$
6.76


$
6.92


$
(0.16
)


(2.3
)%     Percentage2006

2005

Variance

ChangePurchased Gas Sales Volumes (Bcf)


6.1



28.7



(22.6
)


(78.7
)%Average Sales Price (per Mcf)

$
7.20


$
9.59


$
(2.39
)


(24.9
)%   No. 99-19 (EITF 99-19), EITF 04-13
 45




---



##### Table of Contents



Dollar


Percentage2006


2005


Variance


ChangeRoyalty Income

$
10,230


$
8,158


$
2,072



25.4
%Business Interruption Insurance


10,165







10,165



100.0
%Interest Income


3,453



418



3,035



726.1
%Third Party Gathering Revenue


1,341



1,110



231



20.8
%Other Miscellaneous


97



173



(76
)


(43.9
)%Total Other Income

$
25,286


$
9,859


$
15,427



156.5
%         Costs and
    Expenses
    Dollar


Percentage2006


2005


Variance


ChangeCosts and Expenses:Lifting Costs

$
33,357


$
30,399


$
2,958



9.7
%Gathering and Compression Costs


58,102



43,903



14,199



32.3
%Royalty Interest Gas Costs


41,998



36,641



5,357



14.6
%Purchased Gas Costs


44,843



278,720



(233,877
)


(83.9
)%Other


1,082



2,878



(1,796
)


(62.4
)%General and Administrative


39,168



19,129



20,039



104.8
%Depreciation, Depletion and Amortization


37,999



35,039



2,960



8.4
%Interest Expense


870



14



856



6,114.3
%Total Costs and Expenses

$
257,419


$
446,723


$
(189,304
)


(42.4
)%     Percentage2006

2005

Variance

ChangeSales Volumes (Bcf)


55.9



48.2



7.7



16.0
%Average Lifting Costs (per Mcf)

$
0.60


$
0.63


$
(0.03
)


(4.8
)%  46




---



##### Table of Contents



Percentage2006

2005

Variance

ChangeSales Volumes (Bcf)


55.9



48.2



7.7



16.0
%Average Gathering and Compression Costs (per Mcf)

$
1.04


$
0.91


$
0.13



14.3
%   EITF 04-13,
  Percentage2006

2005

Variance

ChangeRoyalty Interest Gas Sales Volumes (Bcf)


7.6



6.6



1.0



15.2
%Average Cost (per Mcf)

$
5.56


$
5.59


$
(0.03
)


(0.5
)%     Percentage2006

2005

Variance

ChangePurchased Gas Cost Volumes (Bcf)


6.1



28.7



(22.6
)


(78.7
)%Average Purchased Gas Costs (per Mcf)

$
7.34


$
9.71


$
(2.37
)


(24.4
)%   No. 99-19 (EITF 99-19), EITF 04-13
    Dollar


Percentage2006


2005


Variance


ChangeExploration

$
2,708


$
1,830


$
878



48.0
%Imbalance


(648
)


899



(1,547
)


(172.1
)%Equity in (Earnings) Loss of Affiliates


(978
)


149



(1,127
)


(756.4
)%Total Other Costs and Expenses

$
1,082


$
2,878


$
(1,796
)


(62.4
)%    47




---



##### Table of Contents



Dollar


Percentage2006


2005


Variance


ChangeProduction

$
24,668


$
23,531


$
1,137



4.8
%Gathering


13,331



11,508



1,823



15.8
%Total Depreciation, Depletion and Amortization

$
37,999


$
35,039


$
2,960



8.4
%       Income
    Taxes
  Percentage2006


2005


Variance


ChangeEarnings Before Income Taxes

$
256,440


$
166,718


$
89,722



53.8
%Tax Expense

$
96,573


$
64,550


$
32,023



49.6
%Effective Income Tax Rate


37.7
%


38.7
%


(1.0
)%     Issues
    Regarding Coal Mining Activities
   48




---



##### Table of Contents



Critical
    Accounting Policies
    Derivative
    Instruments
        Stock-Based
    Compensation
       49




---



##### Table of Contents



Estimated
    Net Recoverable Reserves
    Regulation S-X Rule 4-10(a)
      Contingencies
   50




---



##### Table of Contents



Income
    Taxes
      Asset
    Retirement Obligations
        Liquidity
    and Capital Resources
     51




---



##### Table of Contents



Cash
    Flows
  2007


2006


ChangeCash provided by operating activities

$
272,448


$
243,569


$
28,879Cash used in investing activities

$
(354,227
)

$
(156,020
)

$
(198,207
)Cash provided by (used in) financing activities

$
6,654


$
(449
)

$
7,103     
    Cash provided by operating activitiesincreased primarily
    due to increased production and higher realized prices. These
    increases are partially offset by increased operating costs and
    various other working capital requirements.
    Cash used in investing activitiesincreased primarily due
    to higher capital expenditures, which is a result of our
    continuously expanding drilling program. The 2007 year also
    included a $61,777 acquisition of mineral rights, as detailed
    further in Note 2 to the Consolidated Financial Statements,
    as well as capital expenditures of $8,034 related to our
    variable interest entity.
    Cash provided by (used in) financing activitiesincreased
    primarily due to $8,851 of debt proceeds from our variable
    interest entity, partially offset by capital lease payments of
    $2,552 related to the Jewell Ridge pipeline. 52




---



##### Table of Contents



Contractual
    Commitments
    Within


1-3


3-5


More Than1 Year


Years


Years


5 Years


Total(Dollars in thousands)Long Term Debt Obligations

$
3,051


$
5,800


$



$



$
8,851Capital Lease Obligations


2,768



6,185



7,162



47,802



63,917Interest on Capital Lease Obligation


4,612



8,575



7,598



17,333



38,118Operating Lease Obligations


1,515



2,633



1,838



1,104



7,090Gas Firm Transportation Obligations


7,870



14,379



9,948



17,095



49,292Other Long-Term Liabilities(a)


118



582



936



19,058



20,694Total Contractual Obligations

$
19,934


$
38,154


$
27,482


$
102,392


$
187,962     (a)
    
    This item includes asset retirement obligations, pension,
    postretirement benefits other than pension and legal
    contingencies, which are reflected on the balance sheet for the
    potential settlements of the two cases referenced in
    Note 17 to the Consolidated Financial Statements. Due to
    the uncertainty surrounding these settlements, it is difficult
    to predict if and when a payout may take place.(b)
    
    The significant obligation table does not include obligations to
    taxing authorities due to the uncertainty surrounding the
    ultimate settlement of amounts and timing of these obligations.    $200,000
    Credit Facility
      Stockholders
    Equity
  Form 10-K.
 53




---



##### Table of Contents



Off-Balance
    Sheet Arrangements
    Recent
    Accounting Pronouncements
  ®
  Fair Value Measurements.
     54




---



##### Table of Contents



ITEM 7A.
    QUANTITATIVE
    AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK              IncrementalDecreaseAssuming aHypotheticalPrice Increaseof:10%

25%(Dollars in millions)Pre-Tax Income(1)

$
25.4


$
64.1     (1)
    
    CNX Gas remains at risk for possible changes in the market value
    of these derivative instruments; however, such risk should be
    reduced by price changes in the underlying hedged item. The
    effect of this offset is not reflected in the sensitivity
    analyses. CNX Gas entered into derivative instruments to convert
    the market prices related to portions of the 2008 through 2009
    anticipated sales of natural gas to fixed prices. The
    sensitivity analyses reflect an inverse relationship between
    increases in commodity prices and a benefit to earnings. When
    commodity prices increase, pretax income decreases. As of
    December 31, 2007, the fair value of these contracts was a
    net gain of $5,881 (net of $3,738 deferred tax). We will
    continually evaluate the portfolio of derivative commodity
    instruments and adjust the strategy to anticipated market
    conditions and risks accordingly. 55




---



##### Table of Contents



Hedging
    Volumes
    Three Months


Three Months


Three Months


Three MonthsEnded


Ended


Ended


EndedMarch 31,


June 30,


September 30,


December 31,


Total Year2008 Fixed Price Volumes Hedged Mcf


6,097,938



6,097,938



6,164,948



6,164,948



24,525,772Weighted Average Hedge Price/Mcf

$
8.39


$
8.24


$
8.29


$
8.29


$
8.302009 Fixed Price Volumes Hedged Mcf


4,175,258



2,814,433



2,845,361



2,845,361



12,680,413Weighted Average Hedge Price/Mcf

$
8.82


$
8.35


$
8.39


$
8.52


$
8.552010 Fixed Price Volumes Hedged Mcf


1,824,742















1,824,742Weighted Average Hedge Price/Mcf

$
8.78














$
8.78        56




---



##### 



ITEM 8.
    FINANCIAL
    STATEMENTS AND SUPPLEMENTARY DATA   
 PageFinancial StatementsReport of Independent Registered Public
    Accounting Firm


58Consolidated Statements of Income for the twelve
    months ended December 31, 2007, 2006 and 2005


59Consolidated Balance Sheets as of
    December 31, 2007 and 2006


60Consolidated Statements of Stockholders
    Equity for the twelve months ended December 31, 2007, 2006
    and 2005


61Consolidated Statements of Cash Flows for the
    twelve months ended December 31, 2007, 2006 and 2005


62Notes to Audited Financial Statements


63   57




---



##### Table of Contents



Report of
    Independent Registered Public Accounting Firm    Internal Control  Integrated Framework
        
  
 58




---



##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF INCOME
  For the Twelve Months Ended December 31,2007


2006


2005(Dollars in thousands, except per share data)Revenue and Other Income:Outside Sales

$
404,835


$
385,056


$
277,031Related Party Sales


11,618



8,490



6,052Royalty Interest Gas Sales


46,586



51,054



45,351Purchased Gas Sales


7,628



43,973



275,148Other Income


6,641



25,286



9,859Total Revenue and Other Income


477,308



513,859



613,441Costs and Expenses:Lifting Costs


38,721



33,357



30,399Gathering and Compression Costs


61,798



58,102



43,903Royalty Interest Gas Costs


40,011



41,998



36,641Purchased Gas Costs


7,162



44,843



278,720Other


79



1,082



2,878General and Administrative


54,825



39,168



19,129Depreciation, Depletion and Amortization


48,961



37,999



35,039Interest Expense


5,606



870



14Total Costs and Expenses


257,163



257,419



446,723Earnings Before Income Taxes and Minority Interest


220,145



256,440



166,718Minority Interest


494







Earnings Before Income Taxes


220,639



256,440



166,718Income Taxes


84,961



96,573



64,550Net Income

$
135,678


$
159,867


$
102,168Earnings per share:Basic

$
0.90


$
1.06


$
0.76Diluted

$
0.90


$
1.06


$
0.76Weighted Average Number of Common Shares Outstanding:Basic


150,886,433



150,845,518



134,071,334Dilutive


151,133,520



151,017,456



134,137,219    59




---



##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIESCONSOLIDATED BALANCE SHEETS
  December 31,2007


2006(Dollars in thousands)ASSETSCurrent Assets:Cash and Cash Equivalents

$
32,048


$
107,173Accounts Receivable:Trade


38,680



46,062Net Related Party


1,022



2,745Other


1,406



2,291Derivatives


10,711



10,548Recoverable Income Taxes


972



Other Current Assets


3,148



3,917Total Current Assets


87,987



172,736Property, Plant and Equipment, Net


1,254,906



918,162Other Assets


9,526



11,820Investments in Equity Affiliates


28,284



52,283TOTAL ASSETS

$
1,380,703


$
1,155,001LIABILITIES AND STOCKHOLDERS EQUITYCurrent Liabilities:Accounts Payable

$
30,263


$
27,872Accrued Royalties Payable


12,896



11,960Accrued Severance Taxes


2,620



2,576Accrued Income Taxes






2,191Deferred Taxes


1,269



3,091Current Portion of Long-term Debt


5,819



2,573Other Current Liabilities


9,817



6,649Total Current Liabilities


62,684



56,912Long-Term Debt


66,949



63,897Deferred Credits and Other Liabilities:Deferred Taxes


188,415



120,008Other Liabilities


30,965



15,977Asset Retirement Obligations


3,981



9,214Derivatives


1,092



6,465Postretirement Benefits Other Than Pension


2,700



2,313Total Deferred Credits and Other Liabilities


227,153



153,977Minority Interest


680



Total Liabilities and Minority Interest


357,466



274,786Stockholders EquityCommon Stock, $.01 par value; 200,000,000 Shares
    Authorized, 150,915,198 Issued and Outstanding at
    December 31, 2007 and 150,864,075 Issued and Outstanding at
    December 31, 2006


1,509



1,508Capital in Excess of Par Value


785,575



781,960Retained Earnings


229,962



94,337Accumulated Other Comprehensive Income


6,191



2,410Total Stockholders Equity


1,023,237



880,215TOTAL LIABILITIES AND STOCKHOLDERS EQUITY

$
1,380,703


$
1,155,001    60




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##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF STOCKHOLDERS
    EQUITY
  Accumulated


UnearnedCapital In


Retained


Other


Compensation


TotalCommon


Excess of


Earnings


Comprehensive


on Restricted


StockholdersStock


Par Value


(Deficit)


Income (Loss)


Stock Units


Equity(Dollars in thousands)Balance at December 31, 2004

$



$
215,710


$
252,469


$
(5,623
)

$



$
462,556Net Income










102,168











102,168Gas Cash Flow Hedge (Net of $18,542 tax)














(29,110
)(a)






(29,110
)Comprehensive Income (Loss)










102,168



(29,110
)






73,058Issuance of Common Stock


1,508



418,659















420,167Effect of Tax Basis
    Step-up






165,042















165,042Issuance of Restricted Stock units under the Equity Incentive
    Plan (92,969 units)






1,487











(1,487
)


Stock-Based Compensation


















205



205Dividends paid










(420,167
)










(420,167
)Return of Capital to Parent






(21,389
)














(21,389
)Balance at December 31, 2005


1,508



779,509



(65,530
)


(34,733
)


(1,282
)


679,472Net Income










159,867











159,867Gas Cash Flow Hedge (Net of $23,859 tax)














36,382
(b)






36,382Comprehensive Income










159,867



36,382







196,249Initial adjustment upon adoption of FAS 158 (net of $485
    tax)














761







761Elimination of Unearned Compensation on Restricted Stock Units






(1,282
)










1,282



Stock-Based Compensation






3,733















3,733Balance at December 31, 2006


1,508



781,960



94,337



2,410
(c)






880,215Net Income










135,678











135,678Gas Cash Flow Hedge (Net of $2,145 tax)














4,214
(d)






4,214FAS 158 OPEB Adjustment (Net of $190 tax)














(296
)






(296
)FAS 158 Pension Adjustment (Net of $88 tax)














(137
)






(137
)Comprehensive Income










135,678



3,781







139,459FASB Interpretation No. 48 Adoption










(53
)










(53
)Stock Options Exercised


1



302















303Tax Benefit from Stock-Based Compensation






53















53Amortization of Restricted Stock Unit Grants






653















653Amortization of Stock Option Grants






2,607















2,607Balance at December 31, 2007

$
1,509


$
785,575


$
229,962


$
6,191
(e)

$



$
1,023,237     (a)
    
    Of the ($29,110) net change in accumulated other comprehensive
    income (loss) in the period, ($30,948) represents the
    settlements recognized in net income.(b)
    
    Of the $36,382 net change in accumulated other
    comprehensive income (loss) in the period, $18,148 represents
    the settlements recognized in net income.(c)
    
    Comprised of unrealized transition adjustments of $592 OPEB
    revaluation and $169 Pension revaluation. Also, $1,649 of
    deferred net gains on financial instruments.(d)
    
    Of the $4,214 net change in accumulated other comprehensive
    income in the period, $18,904 represents the settlements
    recognized in net income.(e)
    
    Comprised of unrealized transition adjustments of $296 OPEB
    revaluation and $32 Pension revaluation. Also, $5,863 of
    deferred net gains on financial instruments.   61




---



##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF CASH FLOWS
  For the Twelve MonthsEnded December 31,2007


2006


2005(Dollars in thousands)Operating Activities:Net Income

$
135,678


$
159,867


$
102,168Adjustments to Reconcile Net Income to Net Cash Provided By
    Operating Activities:Depreciation, Depletion and Amortization


48,961



37,999



35,039Compensation from Restricted Stock Unit Grants


653



529



205Compensation from Stock Option Grants


2,607



3,204



Minority Interest


494







Deferred Income Taxes


70,352



60,358



46,779Equity in (Income) Loss of Affiliates


(2,174
)


(978
)


149Changes in Operating Assets:Accounts and Notes Receivable


8,267



(6,682
)


(40,236
)Related Party Receivable


1,723



(2,017
)


(728
)Other Current Assets


770



(2,284
)


3,542Changes in Other Assets


2,294



83



(4,951
)Changes in Operating Liabilities:Accounts Payable


2,732



(7,343
)


(8,936
)Income Taxes


(4,171
)


(3,327
)


5,650Other Current Liabilities


3,193



2,552



14,861Changes in Other Liabilities


1,474



1,668



(8,600
)Other


(405
)


(60
)


55Net Cash Provided by Operating Activities


272,448



243,569



144,997Investing Activities:Capital Expenditures


(357,199
)


(154,243
)


(110,752
)Investment in Equity Affiliates


2,785



(1,777
)


2,465Proceeds from Sales of Assets


187







Net Cash Used in Investing Activities


(354,227
)


(156,020
)


(108,287
)Financing Activities:Capital Lease Payments


(2,552
)


(449
)


Debt Proceeds


8,851







Exercise of Stock Options


302







Tax Benefit from Stock Based Compensation


53







Issuance of Common Stock










420,167Dividends Paid










(420,167
)Payments to Parent










(16,640
)Net Cash Provided by (Used in) Financing Activities


6,654



(449
)


(16,640
)Net Increase (Decrease) in Cash and Cash Equivalents


(75,125
)


87,100



20,070Cash and Cash Equivalents at Beginning of Year


107,173



20,073



3Cash and Cash Equivalents at Year End

$
32,048


$
107,173


$
20,073     62




---



##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIES



NOTES TO
    AUDITED FINANCIAL STATEMENTS

(Dollars
    in thousands)  Note 1 
    Significant
    Accounting Policies:      Basis
    of Consolidation
      Use of
    Estimates
    Cash
    and Cash Equivalents
    Trade
    Accounts Receivable
   63




---



##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIES
  NOTES TO
    AUDITED FINANCIAL
    STATEMENTS  (Continued)
    Property,
    Plant and Equipment
      30-40 years.
    Impairment
    of Long-Lived Assets
    Income
    Taxes
     64




---



##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIES
  NOTES TO
    AUDITED FINANCIAL
    STATEMENTS  (Continued)
    Asset
    Retirement Obligations
      Revenue
    Recognition
          Royalty
    Recognition
    Contingencies
   65




---



##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIES
  NOTES TO
    AUDITED FINANCIAL
    STATEMENTS  (Continued)
    Derivative
    Instruments
      Stock-Based
    Compensation
    Earnings
    Per Share
   66




---



##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIES
  NOTES TO
    AUDITED FINANCIAL
    STATEMENTS  (Continued)
    30-day Form S-1
    For the Twelve MonthsEnded December 31,2007


2006


2005Net Income

$
135,678


$
159,867


$
102,168Weighted Average Number of Common Shares Outstanding:Basic


150,886,433



150,845,518



134,071,334Effect of stock-based compensation awards


247,087



171,938



65,885Dilutive


151,133,520



151,017,456



134,137,219Earnings per share:Basic

$
0.90


$
1.06


$
0.76Diluted

$
0.90


$
1.06


$
0.76   Recent
    Accounting Pronouncements
   67




---



##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIES
  NOTES TO
    AUDITED FINANCIAL
    STATEMENTS  (Continued)
    Fair Value Measurements.
      Reclassifications
   68




---



##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIES
  NOTES TO
    AUDITED FINANCIAL
    STATEMENTS  (Continued)
  Note 2 
    Significant
    Acquisitions:        Note 3 
    Transactions
    with Related Parties:    For the Twelve MonthsEnded December 31,2007


2006


2005Sales of Gas-Related Party

$
11,618


$
8,490


$
6,052Supply Purchases

$
699


$
210


$
135           de-gas
 69




---



##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIES
  NOTES TO
    AUDITED FINANCIAL
    STATEMENTS  (Continued)
                 70




---



##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIES
  NOTES TO
    AUDITED FINANCIAL
    STATEMENTS  (Continued)
  Note 4 
    Other
    Income:  For the Twelve MonthsEnded December 31,2007


2006


2005Interest Income

$
3,793


$
3,453


$
418Business Interruption Insurance


1,600



10,165



Third Party Gathering Revenue


1,077



1,341



1,110Miscellaneous


171



97



173Royalty Income






10,230



8,158Total Other Income

$
6,641


$
25,286


$
9,859       Note 5 
    Income
    Taxes:    For the Twelve MonthsEnded December 31,2007


2006


2005Dollars


Rate


Dollars


Rate


Dollars


RateStatutory U.S. Federal Income Tax Rate

$
77,223



35.0
%

$
89,754



35.0
%

$
58,351



35.0
%Net Effect of State Income Tax


9,108



4.1
%


9,032



3.5
%


7,072



4.2
%Other


(1,370
)


(0.6
)%


(2,213
)


(0.8
)%


(873
)


(0.5
)%Income Tax Expense/ Effective Rate

$
84,961



38.5
%

$
96,573



37.7
%

$
64,550



38.7
%   non-U.S. income
 71




---



##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIES
  NOTES TO
    AUDITED FINANCIAL
    STATEMENTS  (Continued)
    For the Twelve MonthsEnded December 31,2007


2006


2005Current:Federal

$
13,836


$
30,032


$
14,713State


2,755



6,183



3,058Deferred:Federal


57,112



52,646



38,957State


11,258



7,712



7,822Total Income Tax Expense

$
84,961


$
96,573


$
64,550     As of December 31,2007


2006Deferred Tax Assets:Capital Lease Obligations

$
25,043


$
25,896Derivatives


428



Asset Retirement Obligations


1,560



3,590Other Postretirement Benefits


1,058



901Stock-Based Compensation


1,176



300Other


9,724



2,738Total Deferred Tax Assets


38,989



33,425Deferred Tax Liabilities:Property, Plant and Equipment


(216,554
)


(145,179
)Investment in Equity Affiliates


(6,936
)


(8,501
)Derivatives


(4,197
)


(1,906
)Other


(986
)


(938
)Total Deferred Tax Liabilities


(228,673
)


(156,524
)Net Deferred Tax Liabilities

$
(189,684
)

$
(123,099
)   W-2
 72




---



##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIES
  NOTES TO
    AUDITED FINANCIAL
    STATEMENTS  (Continued)
    Balance at January 1, 2007

$
3,116Additions related to current year tax positions


1,417Additions related to prior year tax positions


Reductions related to prior year tax positions


Settlements


Balance at December 31, 2007

$
4,533         Note 6 
    Asset Retirement Obligations:
      As of December 31,2007


2006Balance at beginning of year

$
9,214


$
10,908Accretion expense


267



517Payments


(144
)


(183
)Liabilities incurred


1,180



1,348Revisions in estimated cash flows


(6,536
)


(3,376
)Balance at end of period

$
3,981


$
9,214    73




---



##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIES
  NOTES TO
    AUDITED FINANCIAL
    STATEMENTS  (Continued)
  Note 7 
    Property,
    Plant and Equipment:  As of December 31,2007


2006Leasehold Improvements

$
1,351


$
Proved Properties


125,118



91,913Unproved Properties


81,078



765Wells and Related Equipment


166,468



112,009Intangible Drilling


531,098



383,605Gathering Assets


596,171



520,906Asset Retirement Obligations


1,035



5,652Capitalized Internal Software


6,741



6,433Total Property, Plant and Equipment


1,509,060



1,121,283Accumulated Depreciation, Depletion and Amortization


(254,154
)


(203,121
)Property and Equipment, net

$
1,254,906


$
918,162     Note 8 
    Credit
    Facility:       74




---



##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIES
  NOTES TO
    AUDITED FINANCIAL
    STATEMENTS  (Continued)
  Note 9 
    Other
    Current Liabilities:  As of December 31,2007


2006Short Term Incentive Compensation Plan

$
5,241


$
3,944Purchased Gas


1,815



249Accrued Payroll and Benefits


644



1,583Accrued Property Taxes


577



249Accrued Firm Transportation


474



336Other


1,066



288Total Other Current Liabilities

$
9,817


$
6,649   Note 10 
    Leases:    Capital


OperatingLeases


Leases2008

$
7,380


$
1,5152009


7,380



1,3102010


7,380



1,3232011


7,380



1,0412012


7,380



797Thereafter


65,135



1,104Total Minimum Lease Payments


102,035


$
7,090Less Imputed Interest


38,118Present Value of Minimum Lease Payments


63,917Less Amount Due in One Year


2,768Total Long-term Capital Lease Obligation

$
61,149   15-year
   75




---



##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIES
  NOTES TO
    AUDITED FINANCIAL
    STATEMENTS  (Continued)
  Note 11 
    Long-Term
    Debt:    As of December 31, 2007Debt:Note Payable  Huntington National Bank, due 2010 at
    8.16%

$
7,648Members loans payable, due various dates through 2010


823Other notes payable, due various dates through 2010


380Total Debt


8,851Less amounts due in one year


3,051Total Long-term Debt

$
5,800       2008

$
3,0512009


4,0982010


1,7022011


2012


Thereafter


Total Long-Term Debt Maturities

$
8,851   Note 12 
    Pension
    and Other Postretirement Benefits:  Defined
    Benefit Pension Plan
     76




---



##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIES
  NOTES TO
    AUDITED FINANCIAL
    STATEMENTS  (Continued)
      As of December 31,2007


2006Change in benefit obligation:Benefit obligation at beginning of the year

$
207


$
88Service cost


262



282Interest cost


12



5Actuarial loss/(gain)


150



(164
)Benefits paid


(16
)


(4
)Benefit obligation at end of the year

$
615


$
207Change in plan assets:Fair value of plan assets at beginning of period

$
18


$
Actual return on plan assets


(51
)


2Company contributions


337



20Benefits paid


(16
)


(4
)Fair value of plan assets at end of period

$
288


$
18Funded Status:Noncurrent liabilities

$
(327
)

$
(189
)Net obligation recognized

$
(327
)

$
(189
)Amounts recognized in accumulated other comprehensive income
    consist of:Net Gain

$
(50
)

$
(276
)Net amount recognized (before tax effect)

$
(50
)

$
(276
)      77




---



##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIES
  NOTES TO
    AUDITED FINANCIAL
    STATEMENTS  (Continued)
    For the Twelve Months Ended December 31,2007


2006


2005Components of Net Periodic Benefit Costs:Service costs

$
262


$
282


$
219Interest costs


12



5



Expected return on plan assets


(2
)


(9
)


Recognized net actuarial gain


(23
)


(12
)


Benefit costs

$
249


$
266


$
219     As of December 31,2007


2006Discount rate


6.57
%


6.00
%Expected long-term return on plan assets


8.00
%


8.00
%Rate of compensation increase


5.46
%


4.36
%     As ofDecember 31,2007


2006


2005Discount rate


6.00
%


5.75
%


6.00
%Expected long-term return on plan assets


8.00
%


8.00
%


Rate of compensation increase


4.36
%


4.11
%


4.12
%   20-year
   78




---



##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIES
  NOTES TO
    AUDITED FINANCIAL
    STATEMENTS  (Continued)
    PensionPayments2008

$
42009


82010


132011


182012


25Year
    2013-2017


404   Postretirement
    Benefit Plans
      Other Benefits as ofDecember 31,2007


2006Change in benefit obligation:Benefit obligation at beginning of year

$
2,325


$
1,760Service cost


124



91Interest cost


139



101Actuarial loss


335



466Plan amendments






Benefits paid


(109
)


(93
)Benefit obligation at end of year

$
2,814


$
2,325Funded Status:Current liabilities

$
(114
)

$
(12
)Noncurrent liabilities


(2,700
)


(2,313
)Net obligation recognized

$
(2,814
)

$
(2,325
)Amounts recognized in accumulated other comprehensive income
    consist of:Net Loss

$
803


$
489Prior Service Cost


(1,287
)


(1,459
)Net amount recognized (before tax effect)

$
(484
)

$
(970
)  79




---



##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIES
  NOTES TO
    AUDITED FINANCIAL
    STATEMENTS  (Continued)
      For the Twelve Months Ended December 31,2007


2006


2005Components of Net Periodic Benefit Costs:Service costs

$
124


$
91


$
160Interest costs


139



101



170Amortization of prior service costs credit


(172
)


(172
)


(113
)Recognized net actuarial loss


21







42Benefit costs

$
112


$
20


$
259     As of December 31,2007

2006

2005Discount rate


6.63
%


6.00
%


5.75
%     As of December 31,2007

2006

2005Discount rate


6.00
%


5.75
%


6.00
%     As of December 31,2007


2006


2005Healthcare cost trend rate for next year


8.00
%


8.50
%


9.25
%Rate to which the cost trend rate is assumed to decline
    (ultimate trend rate)


5.00
%


5.00
%


4.75
%Year that the rate reaches ultimate trend rate


2014



2011



2011     1-Percentage

1-PercentagePoint Increase

Point DecreaseEffect on total of service and interest costs components

$
43


$
(36
)Effect on accumulated postretirement benefit obligation

$
380


$
(322
)  80




---



##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIES
  NOTES TO
    AUDITED FINANCIAL
    STATEMENTS  (Continued)
    Other BenefitsPayments2008

$
1142009


1202010


1262011


1492012


174Year
    2013-2017


1,080   Note 13 
    Stock-Based
    Compensation:         81




---



##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIES
  NOTES TO
    AUDITED FINANCIAL
    STATEMENTS  (Continued)
      For the Twelve Months EndedDecember 31, 2005Net Income as reported

$
102,168Add: Stock-based compensation expense for restricted stock units


205Deduct: Total stock-based compensation expense determined under
    Black-Scholes option pricing model and stock-based compensation
    expense for restricted stock units, net of tax


(423
)Pro forma net income

$
101,950Earnings per share:Basic  as reported

$
0.76Basic  pro forma

$
0.76Dilutive  as reported

$
0.76Dilutive  pro forma

$
0.76     For the


For the


For theTwelve Months Ended


Twelve Months Ended


Twelve Months EndedDecember 31,


December 31,


December 31,2007


2006


2005Weighted Average Fair Value of Grants

$
9.61


$
9.83


$
5.34Risk Free Interest Rate


4.58
%


4.65
%


4.28
%Dividend Yield










Expected Volatility


34.50
%


32.39
%


36.54
%Expected Forfeiture Rate


2.0
%


2.0
%


Expected Term


4.5 years



4.5 years



4.5 years   Stock
    Options Awards
   82




---



##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIES
  NOTES TO
    AUDITED FINANCIAL
    STATEMENTS  (Continued)
    WeightedAverageWeighted


RemainingAverage


Contractual


Aggregate IntrinsicShares


Exercise Price


Term


Value(In years)


(Dollars in thousands)Balance at December 31, 2006


1,497,319


$
20.01



8.83Granted


15,750



26.78Exercised


(18,337
)


16.37Forfeited


(5,625
)


20.02Balance at December 31, 2007


1,489,107


$
20.13



7.85


$
17,603Vested and expected to vest at December 31, 2007


1,479,251


$
20.07



7.85


$
17,568Exercisable at December 31, 2007


506,392


$
16.24



7.60


$
7,956         Restricted
    Stock Units
      WeightedAverageGrant Date FairShares


ValueNon-vested at December 31, 2006


68,371


$
17.12Granted


16,725



28.70Vested


(32,786
)


16.78Non-Vested at December 31, 2007


52,310


$
21.04  83




---



##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIES
  NOTES TO
    AUDITED FINANCIAL
    STATEMENTS  (Continued)
      Long
    Term Incentive Compensation
   84




---



##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIES
  NOTES TO
    AUDITED FINANCIAL
    STATEMENTS  (Continued)
  Note 14 
    Supplemental
    Cash Flow Information:  For the Twelve MonthsEnded December 31,2007


2006


2005Net Cash provided from operating activities included:Interest paid

$
5,328


$
870


$
14Income Taxes paid

$
19,220


$
37,241


$
12,233Non-cash investing and financing activities:Purchase of Property, Plant and EquipmentChange in Assets

$
(341
)

$
(12,674
)

$
Change in Liabilities

$
(341
)

$
(12,674
)

$
Tenant Improvement AllowanceChange in Assets

$
(1,109
)

$



$
Change in Liabilities

$
(1,109
)

$



$
Accounting for Gas Well Closing CostsChange in Assets

$
3,563


$
2,027


$
(3,591
)Change in Liabilities

$
3,563


$
2,027


$
(3,591
)Adoption of FIN 48Change in Assets

$
(4,572
)

$



$
Change in Liabilities

$
(4,572
)

$



$
Acquisition of Mineral RightsChange in Assets

$
(6,500
)

$



$
Change in Liabilities

$
(6,500
)

$



$
Consolidation of VIEChange in Assets

$
(870
)

$



$
Change in Liabilities

$
(870
)

$



$
Capital Lease ObligationChange in Assets

$



$
(66,919
)

$
Change in Liabilities

$



$
(66,919
)

$
Tax basis
    step-up

$



$



$
(165,041
)Assumed ownership of joint venture assets

$



$



$
(4,769
)  85




---



##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIES
  NOTES TO
    AUDITED FINANCIAL
    STATEMENTS  (Continued)
  Note 15 
    Concentration
    of Credit Risk:    For the TwelveMonths Ended







Percent of


AR BalanceDecember 31


Customer

Amount


Outside Sales


December 31(Dollars in thousands)2007


Atmos Energy Marketing, LLC

$
39,121



10
%

$
2,325B.P. Energy Company


110,517



27
%


7,525Eagle Energy Partners I, L.P.


51,116



13
%


3,867Interstate Gas Supply, Inc.


63,489



16
%


6,531Total 2007




$
264,243



65
%

$
20,2482006


Conoco-Phillips

$
45,920



12
%

$
B.P. Energy Company


89,118



23
%


8,950Interstate Gas Supply, Inc.


55,647



14
%


6,767Eagle Energy Partners I, L.P.


54,258



14
%


5,742Total 2006




$
244,943



63
%

$
21,4592005


Conoco-Phillips

$
68,179



25
%

$
5,210Dominion Field Services, Inc.


102,685



37
%


7,841Columbia Distribution Companies


36,725



13
%


4,584Total 2005




$
207,589



75
%

$
17,635   Note 16 
    Derivative
    Instruments:           86




---



##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIES
  NOTES TO
    AUDITED FINANCIAL
    STATEMENTS  (Continued)
  Note 17 
    Commitments
    and Contingent Liabilities:    No. 337-06).
  No. CL07000065-00).
  No. CL05000149-00)
 87




---



##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIES
  NOTES TO
    AUDITED FINANCIAL
    STATEMENTS  (Continued)
  No. 05-1574), patents-in-suit.
  No. CL04-91)
 88




---



##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIES
  NOTES TO
    AUDITED FINANCIAL
    STATEMENTS  (Continued)
        Amounts


Less Than








BeyondCommitted


1 Year


1-3 Years


3-5 Years


5 YearsLetters of Credit:Gas

$
14,933


$
14,913


$
20


$
0


$
0Total Letters of Credit

$
14,933


$
14,913


$
20


$
0


$
0Surety Bonds:Environmental

$
1,201


$
1,201


$
0


$
0


$
0Other


1,780



1,720



60



0



0Total Surety Bonds

$
2,981


$
2,921


$
60


$
0


$
0Other:Firm Transportation

$
49,292


$
7,870


$
14,379


$
9,948


$
17,095Guarantees


16,270



16,270



0



0



0Total Other

$
65,562


$
24,140


$
14,379


$
9,948


$
17,095Total Commitments

$
83,476


$
41,974


$
14,459


$
9,948


$
17,095   Letters
    of Credit
     89




---



##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIES
  NOTES TO
    AUDITED FINANCIAL
    STATEMENTS  (Continued)
    Surety
    Bonds
    Other
    Guarantees
      Variable
    Interest
        Firm
    Transportation
   90




---



##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIES
  NOTES TO
    AUDITED FINANCIAL
    STATEMENTS  (Continued)
  Note 18 
    Segment
    Information:      Central


Northern








Adjustments &Appalachia


Appalachia


Total


Corporate


Eliminations


ConsolidatedSales  outside

$
374,765


$
30,070


$
404,835


$



$



$
404,835Sales  related parties


11,564



54



11,618











11,618Sales  royalty interest gas


46,169



417



46,586











46,586Sales  purchased gas


7,628







7,628











7,628Other revenue


2,848



21



2,869



3,772







6,641Intersegment revenues


77,335



4,005



81,340







(81,340
)


Total Revenue and Other Income

$
520,309


$
34,567


$
554,876


$
3,772


$
(81,340
)

$
477,308Earnings Before Income Taxes(A)

$
212,521


$
5,241


$
217,762


$
2,877


$



$
220,639Segment assets(B)(C)

$
1,113,107


$
209,700


$
1,322,807


$
57,896


$



$
1,380,703Depreciation, depletion and amortization

$
42,809


$
6,152


$
48,961


$



$



$
48,961Capital expenditures

$
220,795


$
136,404


$
357,199


$



$



$
357,199     (A)
    
    Includes equity in income of affiliates of $2,058 for Central
    Appalachia. Corporate Segment includes $3,772 of interest
    income, $1,011 of bank fees, and $116 of equity in income of
    affiliates.(B)
    
    Includes investments in unconsolidated equity affiliates of
    $3,408 for Central Appalachia. Corporate segment includes
    investment in unconsolidated equity affiliates of $24,876 and
    $972 of recoverable income taxes.(C)
    
    Includes cash of $376 in the Northern Appalachia, related to our
    variable interest entity, and $31,672 in Corporate Segments,
    respectively. 91




---



##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIES
  NOTES TO
    AUDITED FINANCIAL
    STATEMENTS  (Continued)
     Central


Northern








Adjustments &Appalachia


Appalachia


Total


Corporate


Eliminations


ConsolidatedSales  outside

$
364,025


$
21,031


$
385,056


$



$



$
385,056Sales  related parties


8,392



98



8,490











8,490Sales  royalty interest gas


50,878



176



51,054











51,054Sales  purchased gas


43,973







43,973











43,973Other revenue


21,048



785



21,833



3,453







25,286Intersegment revenues


67,326



1,452



68,778







(68,778
)


Total Revenue and Other Income

$
555,642


$
23,542


$
579,184


$
3,453


$
(68,778
)

$
513,859Earnings Before Income Taxes(D)

$
250,607


$
3,825


$
254,432


$
2,008


$



$
256,440Segment assets(E)

$
949,472


$
73,596


$
1,023,068


$
131,933


$



$
1,155,001Depreciation, depletion and amortization

$
35,190


$
2,809


$
37,999


$



$



$
37,999Capital expenditures

$
122,287


$
31,956


$
154,243


$



$



$
154,243     (D)
    
    Includes equity in earnings of affiliates of $1,405 for Central
    Appalachia. Corporate segment includes $3,453 of interest
    income, $1,018 of bank fees, and equity in loss of affiliates of
    $427.(E)
    
    Includes investments in unconsolidated equity affiliates of
    $27,523 for Central Appalachia. Corporate segment includes
    investments in unconsolidated equity affiliates of $24,760 and
    cash of $107,173.    Central


Northern








Adjustments &Appalachia


Appalachia


Total


Corporate


Eliminations


ConsolidatedSales  outside

$
256,967


$
20,064


$
277,031


$



$



$
277,031Sales  related parties


5,969



83



6,052











6,052Sales  royalty interest gas


45,128



223



45,351











45,351Sales  purchased gas


275,148







275,148











275,148Other revenue


9,620



54



9,674



185







9,859Intersegment revenues


46,680



795



47,475







(47,475
)


Total Revenue and Other Income

$
639,512


$
21,219


$
660,731


$
185


$
(47,475
)

$
613,441Earnings (Loss) Before Income Taxes(F)

$
162,769


$
4,339


$
167,108


$
(390
)

$



$
166,718Segment assets(G)

$
763,432


$
41,135


$
804,567


$
54,600


$



$
859,167Depreciation, depletion and amortization

$
31,619


$
3,420


$
35,039


$



$



$
35,039Capital expenditures

$
87,508


$
23,244


$
110,752


$



$



$
110,752  92




---



##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIES
  NOTES TO
    AUDITED FINANCIAL
    STATEMENTS  (Continued)
    (F)
    
    Includes equity in earnings of unconsolidated affiliates of $138
    for Central Appalachia. Corporate segment includes $185 of
    interest income, $288 of bank fees, and equity in loss of
    unconsolidated affiliates of $287.(G)
    
    Includes investments in unconsolidated equity affiliates of
    $24,340 for Central Appalachia. Corporate segment includes
    investments in unconsolidated equity affiliates of $25,188,
    deferred taxes of $9,339 and cash of $20,073.  Note 19 
    Subsequent
    Event:    Other
    Supplemental Information  Supplemental Gas Data
    (unaudited):
    Capitalized
    Costs:
  As of December 31,2007


2006Proved Properties

$
125,118


$
91,913Unproved Properties


81,078



765Wells and Related Equipment


599,382



402,200Gathering Assets


595,137



520,906Uncompleted Wells and Related Equipment


72,858



93,414Total Property, Plant and Equipment


1,473,573



1,109,198Accumulated Depreciation, Depletion and Amortization


(251,367
)


(200,755
)Net Capitalized Costs

$
1,222,206


$
908,443Proportionate Share of Gas Producing Net Property, Plant and
    Equipment of Unconsolidated Equity Affiliates

$
30,364


$
22,139     For the Twelve Months Ended December 31,2007


2006


2005Consolidated


Equity


Consolidated


Equity


Consolidated


EquityOperations


Affiliates


Operations


Affiliates


Operations


AffiliatesProperty acquisitionsProved Properties

$
33,205


$



$
8,797


$



$
7,666


$
20Unproved Properties


80,313







765







667Development


257,935







151,774







86,273



Exploration


16,503







832



2,334



19,370



412Total

$
387,956


$



$
162,168


$
2,334


$
113,976


$
432     (*)
    
    Includes costs incurred whether capitalized or expensed 93




---



##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIES
  NOTES TO
    AUDITED FINANCIAL
    STATEMENTS  (Continued)
   Results
    of Operations for Producing Activities:
  For the Twelve Months Ended December 31,2007


2006


2005Consolidated


Equity


Consolidated


Equity


Consolidated


EquityOperations


Affiliates


Operations


Affiliates


Operations


AffiliatesProduction Revenue

$
416,452


$
2,755


$
393,649


$
1,913


$
283,137


$
2,406Royalty Interest Gas Revenue


46,586



294



51,054



446



45,351



408Purchased Gas Revenue


7,628



201



43,973



356



275,148



2,561Total Revenue


470,666



3,250



488,676



2,715



603,636



5,375Lifting Costs


38,721



679



33,357



480



30,399



623Gathering Costs


61,798



630



58,102



359



43,903



168Royalty Expense


40,011



294



41,998



446



36,641



408Other Costs


19,772



646



12,876



541



10,339



915Purchased Gas Costs


7,162



165



44,843



299



278,720



2,434DD&A


48,961



294



37,999



512



35,039



870Total Costs


216,425



2,708



229,175



2,637



435,041



5,418Pre-tax Operating Income


254,241



542



259,501



78



168,595



(43
)Income Taxes


98,595



210



97,728



29



65,280



(17
)Results of Operations for Producing Activities excluding
    Corporate and Interest Costs

$
155,646


$
332


$
161,773


$
49


$
103,315


$
(26
)Net Reserve Quantity (Mcfe)Beginning Reserves(a)


1,263,293



2,200



1,127,724



2,672



1,042,403



2,385Revisions(b)


(25,036
)


221



109,116



(584
)


57,575



521Extensions and Discoveries


145,834



1,484



82,363



337



77,917



Production


(57,928
)


(321
)


(55,910
)


(225
)


(50,171
)


(234
)Purchases of Reserves In-Place


13,746



















Sales of Reserves In-Place






















Ending Reserves


1,339,909



3,584



1,263,293



2,200



1,127,724



2,672Proved Developed Reserves:Beginning of Period


609,700



2,200



549,574



2,672



395,152



2,385End of Period


667,726



3,584



609,700



2,200



549,574



2,672     (a)
    
    Proved developed and proved undeveloped gas reserves are defined
    by the Securities and Exchange Commission Rule 4.10(a) of
    Regulation S-X.
    Generally, these reserves would be commercially recovered under
    current economic conditions, operating methods and government
    regulations. CNX Gas cautions that there are many inherent
    uncertainties in estimating proved reserve quantities,
    projecting future production rates, and timing of development
    expenditures. Accordingly, these estimates are likely to change
    as future information becomes available. Proved oil and gas
    reserves are estimated quantities of natural gas and CBM gas
    which geological and engineering data demonstrate with
    reasonable certainty to be recoverable in future years from
    known reservoirs under existing economic and operating
    conditions. Proved developed reserves are those reserves
    expected to be recovered through existing wells, with existing
    equipment and operating methods. 94




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##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIES
  NOTES TO
    AUDITED FINANCIAL
    STATEMENTS  (Continued)
   (b)
    
    2007 revisions are based upon our review of production curves of
    over 6,000 wells. Revisions were both upward and downward and no
    well was individually material. Production optimization is an
    ongoing effort.    Standardized
    Measure of Discounted Future Net Cash Flows:
        December 31,2007


2006


2005Future Cash Flows:Revenues

$
9,509,665


$
7,105,265


$
11,675,551Production costs


(3,004,619
)


(2,568,731
)


(2,852,033
)Development costs


(636,436
)


(552,114
)


(422,315
)Income tax expense


(2,259,415
)


(1,500,533
)


(3,251,265
)Future Net Cash Flows


3,609,195



2,483,887



5,149,938Discounted to present value at a 10% annual rate


(2,219,655
)


(1,548,996
)


(3,279,144
)Total standardized measure of discounted net cash flows

$
1,389,540


$
934,891


$
1,870,794  95




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##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIES
  NOTES TO
    AUDITED FINANCIAL
    STATEMENTS  (Continued)
    December 31,2007


2006


2005Balance at Beginning of Period

$
934,891


$
1,870,794


$
1,029,538Net changes in sales prices and production costs


1,688,906



(5,341,525
)


3,539,448Sales net of production costs


(208,810
)


(438,174
)


(234,526
)Net change due to revisions in quantity estimates


485,577



1,492,654



632,547Net change due to acquisition


2,840







Development costs incurred, previously estimated


295,422



169,169



110,916Changes in estimated future development costs


(379,744
)


(298,968
)


(267,691
)Net change in future income taxes


(758,882
)


1,750,732



(1,505,484
)Accretion of discount and other


(670,660
)


1,730,209



(1,433,954
)Total Discounted Cash Flow at End of Period

$
1,389,540


$
934,891


$
1,870,794   Other Supplemental Information  Selected Quarterly
    Data (unaudited)($ in thousands):
  Three Months EndedMarch 31,


June 30,


September 30,


December 31,2007


2007


2007


2007*Total Revenue and Other Income

$
115,132


$
133,471


$
109,805


$
118,900Total Costs and Expense

$
61,894


$
66,539


$
57,808


$
70,428Total Earnings Before Minority Interest

$
53,238


$
66,932


$
51,997


$
47,978Total Earnings Before Income Tax

$
53,238


$
66,932


$
51,997


$
48,472Net Income

$
32,996


$
41,488


$
31,296


$
29,898Earnings per ShareBasic

$
0.22


$
0.27


$
0.21


$
0.20Diluted

$
0.22


$
0.27


$
0.21


$
0.20Weighted Average Shares OutstandingBasic


150,864,825



150,870,810



150,895,233



150,914,225Dilutive


151,068,089



151,145,174



151,149,432



151,241,316     *
    
    Included in the fourth quarter are out-of-period year-to-date
    adjustments made in the fourth quarter.  96




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##### Table of Contents



CNX GAS
    CORPORATION AND SUBSIDIARIES
  NOTES TO
    AUDITED FINANCIAL
    STATEMENTS  (Continued)
  Three Months EndedMarch 31,


June 30,


September 30,


December 31,2006


2006


2006


2006Total Revenue and Other Income

$
148,223


$
122,852


$
123,567


$
119,217Total Costs and Expense

$
73,286


$
60,532


$
61,770


$
61,831Total Earnings Before Income Tax

$
74,937


$
62,320


$
61,797


$
57,386Net Income

$
45,876


$
38,153


$
37,593


$
38,245Earnings per ShareBasic

$
0.30


$
0.25


$
0.25


$
0.25Diluted

$
0.30


$
0.25


$
0.25


$
0.25Weighted Average Shares OutstandingBasic


150,833,334



150,833,334



150,850,930



150,864,075Dilutive


150,931,545



151,060,061



151,029,192



151,062,622  97




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##### Table of Contents



ITEM 9.
    CHANGES
    IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
    FINANCIAL DISCLOSURES    ITEM 9A.
    CONTROLS
    AND PROCEDURES  Disclosure
    controls and procedures
  Rule 13a-15(e) Form 10-K.
  Managements
    Report on Internal Control Over Financial Reporting
          Changes
    in Internal Controls Over Financial Reporting
    ITEM 9B.
    OTHER
    INFORMATION   98




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##### Table of Contents



PART III  ITEM 10.
    DIRECTORS
    AND EXECUTIVE OFFICERS OF THE REGISTRANT    Executive
    Officers of CNX Gas Corporation
    Name

Age

PositionNicholas J. DeIuliis


39


President and Chief Executive Officer and DirectorStephen W. Johnson


49


Executive Vice President, Secretary and General CounselMark D. Gibbons


49


Senior Vice President and Chief Financial OfficerRandall M. Albert


50


Senior Vice President  Emerging Business UnitsDr. DeAnn Craig


56


Senior Vice President  Asset AssessmentJ. Michael Onifer


51


Senior Vice President  Established Business Units   Nicholas J. DeIuliis, 39,
  Stephen W. Johnson, 49,
  Mark D. Gibbons, 49,
 99




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##### Table of Contents



Randall Albert, 50,
  Dr. DeAnn Craig, 56,
  Michael Onifer, 51,
  ITEM 11.
    EXECUTIVE
    COMPENSATION.  Change-In-Control,
  ITEM 12.
    SECURITY
    OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
    MANAGEMENT.   100




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##### Table of Contents



ITEM 13.
    CERTAIN
    RELATIONSHIPS AND RELATED TRANSACTIONS.    ITEM 14.
    PRINCIPAL
    ACCOUNTING FEES AND SERVICES.   PART IV  ITEM 15.
    EXHIBITS AND
    FINANCIAL STATEMENT SCHEDULES.  Financial Statements:
    Financial Statement Schedules:
    Exhibits:
   101




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##### Table of Contents



SIGNATURES  Pursuant to the requirements of Section 13 or 15(d) of
    the Securities Exchange Act of 1934, the registrant has duly
    caused this report to be signed on its behalf by the
    undersigned, thereunto duly authorized, as of the 15th day
    of February, 2008.
    By:
    /s/  Nicholas
    J. DeIuliis     Pursuant to the requirements of the Securities Exchange Act
    of 1934, this report has been signed as of the 15th day of
    February, 2008, by the following persons on behalf of the
    Registrant in the capacities indicated:
  Signature

Title/s/  Philip
    W. BaxterPhilip
    W. Baxter

Chairman of the Board/s/  Nicholas
    J. DeIuliisNicholas
    J. DeIuliis

President, Chief Executive Officer and Director (Principal
    Executive Officer)/s/  Mark
    D. GibbonsMark
    D. Gibbons

Chief Financial Officer (Principal Financial and Accounting
    Officer)/s/  J.
    Brett HarveyJ.
    Brett Harvey

Director/s/  James
    E. Altmeyer, Sr.James
    E. Altmeyer, Sr.

Director/s/  Raj
    K. GuptaRaj
    K. Gupta

Director/s/  John
    R. PipskiJohn
    R. Pipski

Director/s/  William
    J. LyonsWilliam
    J. Lyons

Director/s/  Joseph
    T. WilliamsJoseph
    T. Williams

Director  102




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##### Table of Contents



EXHIBIT INDEX
  3
.1

Amended and Restated Certificate of Incorporation of CNX Gas
    Corporation(1)3
.2

Second Amended and Restated Bylaws of CNX Gas Corporation(23)4
.1

Form of stock certificate(1)10
.1

Summary of Employment Terms for Nicholas J. DeIuliis(2)*10
.2

Offer letter for Ronald Smith(2)*10
.3

Offer letter for Gary J. Bench(1)*10
.4

Offer letter for Stephen W. Johnson(1)*10
.5

Form of Change in Control Agreement for DeIuliis, Bench, Albert
    and Onifer(1)(26)*10
.6

Form of Change in Control Agreement for Johnson, Smith, Gibbons
    and Craig(1)*10
.7

Master Separation Agreement dated as of August 1, 2005 by
    and among CONSOL Energy Inc. and each of the its subsidiaries
    (other than CNX Gas Corporation and its subsidiaries) and CNX
    Gas Corporation and its subsidiaries(3)10
.8

Master Cooperation and Safety Agreement dated as of
    August 1, 2005 by and among CONSOL Energy Inc. and each CEI
    Subsidiary (as defined therein) and CNX Gas Corporation and each
    CNX Subsidiary (as defined therein)(3)10
.9

Tax Sharing Agreement dated August 1, 2005 between CONSOL
    Energy Inc. and CNX Gas Corporation(3)10
.10

Services Agreement dated August 1, 2005 by and among CONSOL
    Energy Inc., CNX Land Resources Inc. and CNX Gas Corporation and
    its subsidiaries that become a party to the agreement(3)10
.11

Intercompany Revolving Credit Agreement between CONSOL Energy
    Inc. and CNX Gas Corporation(3)10
.12

Master Lease dated August 1, 2005 by and between CONSOL
    Energy Inc. and each of its subsidiaries made a party thereto
    and CNX Gas Company, LLC(3)10
.13

Summary sheet regarding director compensation(1)10
.14

Credit Agreement dated October 7, 2005 between CNX Gas
    Corporation, certain of its subsidiaries, and the Lender parties
    thereto(4)10
.15

Indenture, dated March 7, 2002, among CONSOL Energy Inc.,
    certain subsidiaries of CONSOL Energy Inc. and The Bank of Nova
    Scotia Trust Company of New York, as trustee(5)10
.16

Supplemental Indenture No. 1, dated March 7, 2002,
    among CONSOL Energy Inc., certain subsidiaries of CONSOL Energy
    Inc. and The Bank of Nova Scotia Trust Company of New York,
    as trustee(6)10
.17

Supplemental Indenture No. 2, dated as of
    September 30, 2003, among CONSOL Energy Inc., certain
    subsidiaries of CONSOL Energy Inc. and The Bank of Nova Scotia
    Trust Company of New York, as trustee(7)10
.18

Supplemental Indenture No. 3, dated as of April 15,
    2005, among CONSOL Energy Inc., certain subsidiaries of CONSOL
    Energy Inc. and The Bank of Nova Scotia Trust Company of
    New York, as trustee(8)10
.19

Supplemental Indenture No. 4, dated as of August 8,
    2005, among CONSOL Energy Inc., certain subsidiaries of CONSOL
    Energy Inc. and The Bank of Nova Scotia Trust Company of
    New York, as trustee(3)10
.20

Supplemental Indenture No. 5, dated as of October 21,
    2005, among CONSOL Energy Inc., certain subsidiaries of CONSOL
    Energy Inc. and The Bank of Nova Scotia Trust Company of
    New York, as trustee(9)10
.21

Precedent Agreement dated July 29, 2005 by and between East
    Tennessee Natural Gas, LLC and CNX Gas Company, LLC.(10)10
.22

Description of the CNX Gas Corporation 2006 Short-Term Incentive
    Compensation Program(11)*10
.23

Firm Transportation Agreement, dated as of
    April 27th , 2006, between CNX Gas Company, LLC, a
    wholly-owned subsidiary of CNX Gas, and East Tennessee Natural
    Gas, LLC.(12)10
.24

Firm Lateral Transportation Agreement, dated as of
    April 27th , 2006, between CNX Gas Company, LLC, a
    wholly-owned subsidiary of CNX Gas, and East Tennessee Natural
    Gas, LLC.(13)10
.25

The summary description of the base compensation and short-term
    incentive opportunities for the executive officers of CNX Gas
    Corporation for 2006.(14)* 103




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##### Table of Contents



10
.26

The initial election grant of options to purchase common stock
    of CNX Gas Corporation to Joseph T. Williams, upon his election
    to the Board of Directors on July 10, 2006(15)*10
.27

CNX Gas Corporation Long-Term Incentive Program for the
    performance period from October 11, 2006 to
    December 31, 2009 and Form of Award Agreement
    thereunder(16)*10
.28

CNX Gas Corporation Equity Incentive Plan, as amended(22)*10
.29

Form of Award Agreements under CNX Gas Corporation Equity
    Incentive Plan(1)10
.30

Summary of Non-Employee Director Compensation effective as of
    November 1, 2006(16)*10
.31

Summary of the awards to CNX Gas Corporations executive
    officers under the CNX Gas Corporation Long-Term Incentive
    Program for the performance period from October 11, 2006 to
    December 31, 2009(16)*10
.32

Offer letter of Mark D. Gibbons(17)*10
.33

Summary description of CNX Gas 2007 Short-term incentive
    program(18)*10
.34

Transfer Agreement dated as of January 24, 2007, between
    the registrant and Gary J. Bench(19)10
.35

Summary description of the base compensation and short-term
    incentive opportunities for the executive officers of CNX Gas
    for 2007(20)*10
.36

Agreement of Sale entered into on June 8, 2007, by and
    between CNX Gas Company LLC, as purchaser, and Consolidation
    Coal Company, as seller(21)10
.37

Asset Exchange Agreement entered into on June 20, 2007, but
    effective as of April 1, 2007, among American Land Holdings
    of Indiana, LLC, et al and CNX Gas Company LLC(21)10
.38

Form Oil and Gas Deed, Assignment, And Assumption, which is
    Exhibit F to Asset Exchange Agreement that is
    Exhibit 10.37, above(21)10
.39

Asset Purchase Agreement entered into on June 20, 2007, but
    effective as of April 1, 2007, among American Land Holdings
    of Indiana, LLC, et al., as seller, and CNX Gas Company LLC, as
    buyer(21)10
.40

Form Oil and Gas Deed, Assignment, Assumption and Bill of
    Sale, which is Exhibit D to Asset Purchase Agreement that
    is Exhibit 10.39, above(21)10
.41

Asset Purchase Agreement entered into on June 20, 2007, but
    effective as of April 1, 2007, among CNX Gas Company LLC,
    as seller, and Cyprus Creek Land Resources, LLC, as buyer(21)10
.42

Asset Purchase Agreement entered into on June 20, 2007, but
    effective as of April 1, 2007, among CNX Gas Company LLC,
    as seller, and Eastern Associated Coal, LLC, as buyer(21)10
.43

Offer letter to Dr. DeAnn Craig dated June 18,
    2007(24)*10
.44

Schedule of Compensation of Non-Employee Directors, effective
    August 2007(24)*10
.45

2008 CNX Gas Long-Term Incentive Program and the Form of Award
    Agreement thereunder*10
.46

Summary of awards under the 2008 CNX Gas Long-Term Incentive
    Program(25)*21


Subsidiaries of CNX Gas Corporation(1)23
.1

Consent of PricewaterhouseCoopers LLP23
.2

Consent of Ralph E. Davis Associates, Inc.23
.3

Consent of Schlumberger Data and Consulting Services31
.1

Certification of Chief Executive Officer pursuant to
    Section 302 of the Sarbanes-Oxley Act of 200231
.2

Certification of Chief Financial Officer pursuant to
    Section 302 of the Sarbanes-Oxley Act of 200232
.1

Certification of Chief Executive Officer pursuant to
    18 U.S.C. Section 1350, as adopted pursuant to
    Section 906 of the Sarbanes-Oxley Act of 200232
.2

Certification of Chief Financial Officer pursuant to
    18 U.S.C. Section 1350, as adopted pursuant to
    Section 906 of the Sarbanes-Oxley Act of 2002     (1)
    
    Incorporated by reference from the Amendment No. 1 to the
    Registration Statement on
    Form S-1
    (file
    no. 333-127483)
    filed on September 29, 2005(2)
    
    Incorporated by reference from the Current Report on
    Form 8-K
    filed by CONSOL Energy Inc. on August 19, 2005 (SEC File
    No. 001-14901) 104




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##### Table of Contents



(3)
    
    Incorporated by reference from the Current Report on
    Form 8-K
    filed by CONSOL Energy Inc. on August 12, 2005 (SEC File
    No. 001-14901)(4)
    
    Incorporated by reference from the Current Report on
    Form 8-K
    filed by CONSOL Energy Inc. on October 13, 2005(5)
    
    Incorporated by reference from Exhibit 4.1 to
    Form 10-K
    filed by CONSOL Energy Inc. on March 29, 2002(6)
    
    Incorporated by reference from Exhibit 4.2 to
    Form 10-K
    filed by CONSOL Energy Inc. on March 29, 2002(7)
    
    Incorporated by reference from Exhibit 4.2 to
    Form 10-Q
    filed by CONSOL Energy Inc. on November 19, 2003(8)
    
    Incorporated by reference from Exhibit 4.2 to
    Form 10-Q
    filed by CONSOL Energy Inc. on August 3, 2005(9)
    
    Incorporated by reference from the Amendment No. 2 to the
    Registration Statement on
    Form S-1
    (file no. 333-127483)
    filed on October 27, 2005(10)
    
    Incorporated by reference from the Amendment No. 4 to the
    Registration Statement on
    Form S-1
    (file no. 333-127483)
    filed on December 17, 2005(11)
    
    Incorporated by reference from the second paragraph of
    Item 1.01 of the Current Report on
    Form 8-K
    filed by CNX Gas Corporation on February 10, 2006(12)
    
    Incorporated by reference from Exhibit 10.1 to
    Form 10-Q
    filed by CNX Gas Corporation on August 2, 2006(13)
    
    Incorporated by reference from Exhibit 10.2 to
    Form 10-Q
    filed by CNX Gas Corporation on August 2, 2006(14)
    
    Incorporated by reference from Item 1.01 of the Current
    Report on
    Form 8-K
    filed by the CNX Gas Corporation on May 1, 2006 (SEC File
    No. 001-32723)(15)
    
    Incorporated by reference from Item 1.01 of the Current
    Report on
    Form 8-K
    filed by CNX Gas Corporation on July 11, 2006 (SEC File
    No. 001-32723)(16)
    
    Incorporated by reference from the Current Report on
    Form 8-K
    filed by CNX Gas Corporation on October 17, 2006 (SEC File
    No. 001-32723)(17)
    
    Incorporated by reference from the Current Report on
    Form 8-K
    filed by CNX Gas on January 26, 2007(18)
    
    Incorporated by reference from the Current Report on
    Form 8-K
    filed by CNX Gas on March 1, 2007(19)
    
    Incorporated by reference from the
    Form 10-Q
    filed by CNX Gas on April 27, 2007(20)
    
    Incorporated by reference from the Current Report on
    Form 8-K
    filed by CNX Gas on April 27, 2007(21)
    
    Incorporated by reference from the
    Form 10-Q
    filed by CNX Gas on July 31, 2007(22)
    
    Incorporated by reference from the Definitive Proxy Statement on
    Schedule 14A, filed by CNX Gas on March 19, 2007(23)
    
    Incorporated by reference from the Current Report on
    Form 8-K
    filed by CNX Gas on August 16, 2007(24)
    
    Incorporated by reference from the
    Form 10-Q
    filed by CNX Gas on October 30, 2007(25)
    
    Incorporated by reference from the Current Report on
    Form 8-K
    filed by CNX Gas on December 14, 2007(26)
    
    With respect to Messrs. Onifer and Albert, the change in
    control agreements have a 2-times multiplier and do not contain
    a Section 280G gross up.In accordance with SEC Release
    33-8238,
    Exhibits 32.1 and 32.2 are being furnished and not filed.*
    
    Management compensatory contract or arrangement. 105