Document:

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                                                                     EXHIBIT 4.1

                         SEVENTH SUPPLEMENTAL INDENTURE

     SEVENTH SUPPLEMENTAL INDENTURE (this "Supplemental Indenture"), dated as of
September 30, 2005, by and among the entities listed on Schedule 1 attached
hereto (the "Guaranteeing Subsidiaries"), each being a subsidiary of Peabody
Energy Corporation (or its permitted successor), a Delaware corporation (the
"Company"), the Company, the other Subsidiary Guarantors (as defined in the
Indenture referred to herein) and US Bank National Association, as Trustee under
the Indenture referred to below (the "Trustee").

                                   WITNESSETH

     WHEREAS, the Company has heretofore executed and delivered to the Trustee
an Indenture (the "Indenture"), dated as of March 21, 2003 providing for the
issuance of an unlimited amount of 6-7/8% Notes due 2013 (the "Notes"), as
supplemented by a First Supplemental Indenture, dated as of May 7, 2003; Second
Supplemental Indenture, dated as of September 30, 2003;Third Supplemental
Indenture, dated as of February 24, 2004; Fourth Supplemental Indenture, dated
April 22, 2004; Fifth Supplemental Indenture, dated October 18, 2004;and Sixth
Supplemental Indenture, dated January 20, 2005.

     WHEREAS, the Indenture provides that under certain circumstances the
Guaranteeing Subsidiaries shall execute and deliver to the Trustee a
supplemental indenture pursuant to which the Guaranteeing Subsidiaries shall
unconditionally guarantee all of the Company's Obligations under the Notes on
the terms and conditions set forth herein (the "Subsidiary Guarantee"); and

     WHEREAS, pursuant to Section 9.01 of the Indenture, the Trustee is
authorized to execute and deliver this Supplemental Indenture.

     NOW THEREFORE, in consideration of the foregoing and for other good and
valuable consideration, the receipt of which is hereby acknowledged, the
Guaranteeing Subsidiaries and the Trustee mutually covenant and agree for the
equal and ratable benefit of the Holders of the Notes as follows:

     1. CAPITALIZED TERMS. Capitalized terms used herein without definition
shall have the meanings assigned to them in the Indenture.

     2. AGREEMENT TO GUARANTEE. The Guaranteeing Subsidiaries hereby agree as
follows:

          (a)  Along with all Subsidiary Guarantors named in the Indenture, to
               jointly and severally Guarantee to each Holder of a Note
               authenticated and delivered by the Trustee and to the Trustee and
               its successors and assigns, irrespective of the validity and

<PAGE>

               enforceability of the Indenture, the Notes or the obligations of
               the Company hereunder or thereunder, that:

               (i)  the principal of and interest on the Notes will be promptly
                    paid in full when due, whether at maturity, by acceleration,
                    redemption or otherwise, and interest on the overdue
                    principal of and interest on the Notes, if any, if lawful,
                    and all other obligations of the Company to the Holders or
                    the Trustee hereunder or thereunder will be promptly paid in
                    full or performed, all in accordance with the terms hereof
                    and thereof; and

               (ii) in case of any extension of time of payment or renewal of
                    any Notes or any of such other obligations, that same will
                    be promptly paid in full when due or performed in accordance
                    with the terms of the extension or renewal, whether at
                    stated maturity, by acceleration or otherwise.

               Failing payment when due of any amount so guaranteed or any
               performance so guaranteed for whatever reason, the Subsidiary
               Guarantors shall be jointly and severally obligated to pay the
               same immediately. Each Subsidiary Guarantor agrees that this is a
               guarantee of payment and not a guarantee of collection.

          (b)  The obligations hereunder shall be joint and several and
               unconditional, irrespective of the validity or enforceability of
               the Notes or the obligations of the Company under the Indenture,
               the absence of any action to enforce the same, any waiver or
               consent by any Holder of the Notes with respect to any provisions
               hereof or thereof, the recovery of any judgment against the
               Company, any action to enforce the same or any other circumstance
               which might otherwise constitute a legal or equitable discharge
               or defense of a Subsidiary Guarantor.

          (c)  The following is hereby waived: diligence, presentment, demand of
               payment, filing of claims with a court in the event of insolvency
               or bankruptcy of the Company, any right to require a proceeding
               first against the Company, protest, notice and all demands
               whatsoever.

          (d)  This Subsidiary Guarantee shall not be discharged except by
               complete performance of the obligations contained in the Notes
               and the Indenture.

          (e)  If any Holder or the Trustee is required by any court or
               otherwise to return to the Company, the Subsidiary Guarantors, or
               any custodian, Trustee, liquidator or other similar official
               acting in

<PAGE>

               relation to either the Company or the Subsidiary Guarantors, any
               amount paid by either to the Trustee or such Holder, this
               Subsidiary Guarantee, to the extent theretofore discharged, shall
               be reinstated in full force and effect.

          (f)  The Guaranteeing Subsidiaries shall not be entitled to any right
               of subrogation in relation to the Holders in respect of any
               obligations guaranteed hereby until payment in full of all
               obligations guaranteed hereby.

          (g)  As between the Subsidiary Guarantors, on the one hand, and the
               Holders and the Trustee, on the other hand, (x) the maturity of
               the obligations guaranteed hereby may be accelerated as provided
               in Article 6 of the Indenture for the purposes of this Subsidiary
               Guarantee, notwithstanding any stay, injunction or other
               prohibition preventing such acceleration in respect of the
               obligations guaranteed hereby, and (y) in the event of any
               declaration of acceleration of such obligations as provided in
               Article 6 of the Indenture, such obligations (whether or not due
               and payable) shall forthwith become due and payable by the
               Subsidiary Guarantors for the purpose of this Subsidiary
               Guarantee.

          (h)  The Subsidiary Guarantors shall have the right to seek
               contribution from any non-paying Subsidiary Guarantor so long as
               the exercise of such right does not impair the rights of the
               Holders under the Subsidiary Guarantee.

          (i)  Pursuant to Section 10.04 of the Indenture, after giving effect
               to any maximum amount and any other contingent and fixed
               liabilities that are relevant under any applicable Bankruptcy or
               fraudulent conveyance laws, and after giving effect to any
               collections from, rights to receive contribution from or payments
               made by or on behalf of any other Subsidiary Guarantor in respect
               of the obligations of such other Subsidiary Guarantor under
               Article 10 of the Indenture shall result in the obligations of
               such Subsidiary Guarantor under Subsidiary Guarantee not
               constituting a fraudulent transfer or conveyance.

     3. EXECUTION AND DELIVERY. Each of the Guaranteeing Subsidiaries agrees
that the Subsidiary Guarantees shall remain in full force and effect
notwithstanding any failure to endorse on each Note a notation of such
Subsidiary Guarantee.

     4. GUARANTEEING SUBSIDIARY MAY CONSOLIDATE, ETC. ON CERTAIN TERMS.

          (a)  The Guaranteeing Subsidiaries may not consolidate with or merge
               with or into (whether or not such Senior Subordinated Note

<PAGE>

               Guarantor is the surviving Person) another corporation, Person or
               entity whether or not affiliated with such Subsidiary Guarantor
               unless:

               (i)  subject to Section 10.04 of the Indenture, the Person formed
                    by or surviving any such consolidation or merger (if other
                    than a Subsidiary Guarantor or the Company) unconditionally
                    assumes all the obligations of such Subsidiary Guarantor,
                    pursuant to a supplemental Indenture in form and substance
                    reasonably satisfactory to the Trustee, under the Notes, the
                    Indenture and the Subsidiary Guarantee on the terms set
                    forth herein or therein; and

               (ii) immediately after giving effect to such transaction, no
                    Default or Event of Default exists.

          (b)  In case of any such consolidation, merger, sale or conveyance and
               upon the assumption by the successor corporation, by supplemental
               Indenture, executed and delivered to the Trustee and satisfactory
               in form to the Trustee, of the Subsidiary Guarantee endorsed upon
               the Notes and the due and punctual performance of all of the
               covenants and conditions of the Indenture to be performed by the
               Subsidiary Guarantor, such successor corporation shall succeed to
               and be substituted for the Subsidiary Guarantor with the same
               effect as if it had been named herein as a Subsidiary Guarantor.
               Such successor corporation thereupon may cause to be signed any
               or all of the Subsidiary Guarantees to be endorsed upon all of
               the Notes issuable hereunder which theretofore shall not have
               been signed by the Company and delivered to the Trustee. All the
               Subsidiary Guarantees so issued shall in all respects have the
               same legal rank and benefit under the Indenture as the Subsidiary
               Guarantees theretofore and thereafter issued in accordance with
               the terms of the Indenture as though all of such Subsidiary
               Guarantees had been issued at the date of the execution hereof.

          (c)  Except as set forth in Articles 4 and 5 of the Indenture, and
               notwithstanding clauses (a) and (b) above, nothing contained in
               the Indenture or in any of the Notes shall prevent any
               consolidation or merger of a Subsidiary Guarantor with or into
               the Company or another Subsidiary Guarantor, or shall prevent any
               sale or conveyance of the property of a Subsidiary Guarantor as
               an entirety or substantially as an entirety to the Company or
               another Subsidiary Guarantor.

<PAGE>

     5. RELEASES.

          (a)  In the event of a sale or other disposition of all of the assets
               of any Subsidiary Guarantor, by way of merger, consolidation or
               otherwise, or a sale or other disposition of all to the capital
               stock of any Subsidiary Guarantor, then such Subsidiary Guarantor
               (in the event of a sale or other disposition, by way of merger,
               consolidation or otherwise, of all of the capital stock of such
               Subsidiary Guarantor) or the corporation acquiring the property
               (in the event of a sale or other disposition of all or
               substantially all of the assets of such Subsidiary Guarantor)
               will be released and relieved of any obligations under its
               Subsidiary Guarantee; provided that the Net Proceeds of such sale
               or other disposition are applied in accordance with the
               applicable provisions of the Indenture, including without
               limitation Section 4.10 of the Indenture. Upon delivery by the
               Company to the Trustee of an Officer's Certificate and an Opinion
               of Counsel to the effect that such sale or other disposition was
               made by the Company in accordance with the provisions of the
               Indenture, including without limitation Section 4.10 of the
               Indenture, the Trustee shall execute any documents reasonably
               required in order to evidence the release of any Subsidiary
               Guarantor from its obligations under its Subsidiary Guarantee.

          (b)  Any Subsidiary Guarantor not released from its obligations under
               its Subsidiary Guarantee shall remain liable for the full amount
               of principal of and interest on the Notes and for the other
               obligations of any Subsidiary Guarantor under the Indenture as
               provided in Article 10 of the Indenture.

     6. NO RECOURSE AGAINST OTHERS. No past, present or future director,
officer, employee, incorporator, stockholder or agent of the Guaranteeing
Subsidiaries, as such, shall have any liability for any obligations of the
Company or any of the Guaranteeing Subsidiaries under the Notes, any Subsidiary
Guarantees, the Indenture or this Supplemental Indenture or for any claim based
on, in respect of, or by reason of, such obligations or their creation. Each
Holder of the Notes by accepting a Note waives and releases all such liability.
The waiver and release are part of the consideration for issuance of the Notes.
Such waiver may not be effective to waive liabilities under the federal
securities laws and it is the view of the Commission that such a waiver is
against public policy.

     7. NEW YORK LAW TO GOVERN. THE LAW OF THE STATE OF NEW YORK SHALL GOVERN
AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE.

<PAGE>

     8. COUNTERPARTS. The parties may sign any number of copies of this
Supplemental Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement.

     9. EFFECT OF HEADINGS. The Section headings herein are for convenience only
and shall not affect the construction hereof.

     10. THE TRUSTEE. The Trustee shall not be responsible in any manner
whatsoever for or in respect of the validity or sufficiency of this Supplemental
Indenture or for or in respect of the recitals contained herein, all of which
recitals are made solely by the Guaranteeing Subsidiaries and the Company.

     IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be executed by their respective officers thereunto duly authorized,
as of the date first written above.

PEABODY ENERGY CORPORATION              US BANK NATIONAL ASSOCIATION
("COMPANY")                             ("TRUSTEE")

By: /s/ Walter L. Hawkins, Jr.          By: /s/ Philip G. Kane, Jr.
    ---------------------------------       ------------------------------------
Name:  Walter L. Hawkins, Jr.           Name: Philip G. Kane, Jr.
Title: Vice President and Treasurer     Title: Vice President

EXISTING SUBSIDIARY GUARANTORS:

                                        AFFINITY MINING COMPANY
                                        AMERICAN LAND HOLDINGS OF KENTUCKY,
                                           LLC  f/k/a BTU VENEZUELA, LLC
                                        APPALACHIA MINE SERVICES, LLC
                                        ARCLAR COMPANY, LLC
                                        ARID OPERATIONS INC.
                                        BEAVER DAM COAL COMPANY
                                        BIG RIDGE, INC.
                                        BIG SKY COAL COMPANY
                                        BLACK BEAUTY COAL COMPANY
                                        BLACK BEAUTY EQUIPMENT COMPANY
                                        BLACK BEAUTY HOLDING COMPANY, LLC
                                        BLACK BEAUTY MINING, INC.
                                        BLACK BEAUTY RESOURCES, INC.
                                        BLACK BEAUTY UNDERGROUND, INC.
                                        BLACK HILLS MINING COMPANY, LLC
                                        BLACK STALLION COAL COMPANY, LLC
                                        BLACK WALNUT COAL COMPANY
                                        BLUEGRASS COAL COMPANY
                                        BTU EMPIRE CORPORATION
                                        CABALLO COAL COMPANY
                                        CENTRAL STATES COAL RESERVES OF
                                           ILLINOIS, LLC
                                           f/k/a PEABODY DEVELOPMENT LAND
                                              HOLDINGS, LLC

<PAGE>

                                        CHARLES COAL COMPANY, LLC
                                           f/k/a CHARLES COAL COMPANY
                                        CLEATON COAL COMPANY
                                        COAL PROPERTIES, LLC
                                           f/k/a COAL PROPERTIES CORP.
                                        COAL SALES, LLC
                                        COAL SALES II, LLC
                                        COAL TRADE INTERNATIONAL, LLC
                                        COAL TRADE, LLC
                                        COAL RESERVES HOLDING LIMITED LIABILITY
                                           COMPANY NO. 1
                                        COAL RESERVES HOLDING LIMITED LIABILITY
                                           COMPANY NO. 2
                                        COLONY BAY COAL COMPANY
                                        COLORADO YAMPA COAL COMPANY
                                        COOK MOUNTAIN COAL COMPANY, LLC
                                           f/k/a COOK MOUNTAIN COAL COMPANY
                                        COTTONWOOD LAND COMPANY
                                        COULTERVILLE COAL COMPANY, LLC
                                           f/k/a WILLIAMSVILLE COAL COMPANY, LLC
                                        CYPRUS CREEK LAND COMPANY
                                        CYPRUS CREEK LAND RESOURCES, LLC
                                        DIXON MINING COMPANY, LLC
                                        DODGE HILL HOLDING JV, LLC
                                        DODGE HILL OF KENTUCKY, LLC
                                        DODGE HILL MINING COMPANY, LLC
                                        EACC CAMPS, INC.
                                        EAGLE COAL COMPANY
                                        EASTERN ASSOCIATED COAL, LLC
                                           f/k/a EASTERN ASSOCIATED COAL CORP.
                                        EASTERN ROYALTY CORP.
                                        EMPIRE MARINE, LLC
                                        FALCON COAL COMPANY
                                        GALLO FINANCE COMPANY
                                        GOLD FIELDS CHILE, LLC
                                           f/k/a GOLD FIELDS CHILE, S.A.
                                        GOLD FIELDS MINING, LLC
                                        GOLD FIELDS ORTIZ, LLC
                                           f/k/a GOLD FIELDS OPERATING CO. -
                                              ORTIZ
                                        GRAND EAGLE MINING, INC.
                                        HAYDEN GULCH TERMINAL, INC.
                                        HIGHLAND MINING COMPANY, LLC
                                           f/k/a HIGHLAND MINING COMPANY
                                        HIGHWALL MINING SERVICES COMPANY
                                        HILLSIDE MINING COMPANY
                                        HMC MINING, LLC
                                        INDEPENDENCE MATERIAL HANDLING
                                           COMPANY
                                        INDIAN HILL COMPANY
                                        INTERIOR HOLDINGS, LLC
                                           f/k/a INTERIOR HOLDINGS CORP.
                                        JAMES RIVER COAL TERMINAL, LLC
                                           f/k/a JAMES RIVER COAL TERMINAL
                                           COMPANY
                                        JARRELL'S BRANCH COAL COMPANY
                                        JUNIPER COAL COMPANY

<PAGE>

                                        KANAWHA RIVER VENTURES I, LLC
                                        KAYENTA MOBILE HOME PARK, INC.
                                        LOGAN FORK COAL COMPANY

                                        MARTINKA COAL COMPANY, LLC
                                           f/k/a MARTINKA COAL COMPANY
                                        MIDCO SUPPLY AND EQUIPMENT
                                           CORPORATION
                                        MIDWEST COAL ACQUISITION CORP.
                                        MOUNTAIN VIEW COAL COMPANY, LLC
                                           f/k/a MOUNTAIN VIEW COAL COMPANY
                                        MUSTANG ENERGY COMPANY, L.L.C.
                                        NORTH PAGE COAL CORP.
                                        OHIO COUNTY COAL COMPANY
                                        PATRIOT COAL COMPANY, L.P.
                                        PDC PARTNERSHIP HOLDINGS, INC.
                                        PEABODY AMERICA, INC.
                                        PEABODY ARCHVEYOR, L.L.C.
                                        PEABODY COAL COMPANY, LLC
                                           f/k/a PEABODY COAL COMPANY
                                        PEABODY DEVELOPMENT COMPANY, LLC
                                        PEABODY ENERGY GENERATION HOLDING
                                           COMPANY
                                        PEABODY ENERGY INVESTMENTS, INC.
                                        PEABODY ENERGY SOLUTIONS, INC.
                                        PEABODY HOLDING COMPANY, INC.
                                        PEABODY INVESTMENTS CORP.
                                        PEABODY NATURAL GAS, LLC
                                        PEABODY NATURAL RESOURCES COMPANY
                                        PEABODY POWERTREE INVESTMENTS, LLC
                                        PEABODY RECREATIONAL LANDS, L.L.C.
                                        PEABODY SOUTHWESTERN COAL COMPANY
                                        PEABODY TERMINALS, LLC
                                           f/k/a PEABODY TERMINALS, INC.
                                        PEABODY VENEZUELA COAL CORP.
                                        PEABODY-WATERSIDE DEVELOPMENT, L.L.C.
                                        PEABODY WESTERN COAL COMPANY
                                        PEC EQUIPMENT COMPANY, LLC
                                        PHC ACQUISITION CORP.
                                           f/k/a RIO ESCONDIDO COAL CORP.
                                        PINE RIDGE COAL COMPANY, LLC
                                           f/k/a PINE RIDGE COAL COMPANY
                                        POINT PLEASANT DOCK COMPANY, LLC
                                        POND CREEK LAND RESOURCES, LLC
                                        POND RIVER LAND COMPANY
                                        PORCUPINE PRODUCTION, LLC
                                        PORCUPINE TRANSPORTATION, LLC
                                        POWDER RIVER COAL COMPANY
                                        PRAIRIE STATE GENERATING COMPANY, LLC
                                        RANDOLPH LAND HOLDING COMPANY, LLC
                                        RIVERS EDGE MINING, INC.
                                        RIVERVIEW TERMINAL COMPANY
                                        SENECA COAL COMPANY
                                        SENTRY MINING COMPANY
                                        SHOSHONE COAL CORPORATION
                                        SNOWBERRY LAND COMPANY

<PAGE>

                                        STAR LAKE ENERGY COMPANY, L.L.C.

                                        STERLING SMOKELESS COAL COMPANY, LLC
                                           f/k/a STERLING SMOKELESS COAL
                                              COMPANY
                                        SUGAR CAMP PROPERTIES
                                        THOROUGHBRED, L.L.C.
                                        THOROUGHBRED GENERATING COMPANY, LLC
                                        THOROUGHBRED MINING COMPANY, L.L.C.
                                        TWENTYMILE COAL COMPANY
                                        UNION COUNTY COAL CO., LLC
                                        YANKEETOWN DOCK, LLC
                                           f/k/a YANKEETOWN DOCK CORPORATION

                                        By: /s/ Walter L. Hawkins, Jr.
                                            ------------------------------------
                                        Name: Walter L. Hawkins, Jr.
                                        Title: Vice President

ADDITIONAL GUARANTORS:

                                        AMERICAN LAND DEVELOPMENT, LLC

                                        By: /s/ Walter L. Hawkins, Jr.
                                            ------------------------------------
                                        Name: Walter L. Hawkins, Jr.
                                        Title: Vice President & Treasurer

                                        AMERICAN LAND HOLDINGS OF ILLINOIS, LLC

                                        By: /s/ Walter L. Hawkins, Jr.
                                            ------------------------------------
                                        Name: Walter L. Hawkins, Jr.
                                        Title: Vice President & Treasurer

                                        AMERICAN LAND HOLDINGS OF INDIANA, LLC

                                        By: /s/ Walter L. Hawkins, Jr.
                                            ------------------------------------
                                        Name: Walter L. Hawkins, Jr.
                                        Title: Vice President & Treasurer

                                        CENTRAL STATES COAL RESERVES OF
                                        KENTUCKY, LLC

                                        By: /s/ Walter L. Hawkins, Jr.
                                            ------------------------------------
                                        Name: Walter L. Hawkins, Jr.
                                        Title: Vice President & Treasurer

<PAGE>

                                        DYSON CREEK COAL COMPANY, LLC

                                        By: /s/ Walter L. Hawkins, Jr.
                                            ------------------------------------
                                        Name: Walter L. Hawkins, Jr.
                                        Title: Vice President & Treasurer

                                        EASTERN COAL COMPANY, LLC

                                        By: /s/ Walter L. Hawkins, Jr.
                                            ------------------------------------
                                        Name: Walter L. Hawkins, Jr.
                                        Title: Vice President & Treasurer

                                        MIDWEST COAL RESERVES OF ILLINOIS, LLC

                                        By: /s/ Walter L. Hawkins, Jr.
                                            ------------------------------------
                                        Name: Walter L. Hawkins, Jr.
                                        Title: Vice President & Treasurer

                                        MIDWEST COAL RESERVES OF INDIANA, LLC

                                        By: /s/ Walter L. Hawkins, Jr.
                                            ------------------------------------
                                        Name: Walter L. Hawkins, Jr.
                                        Title: Vice President & Treasurer

                                        MIDWEST COAL RESOURCES, LLC

                                        By: /s/ Walter L. Hawkins, Jr.
                                            ------------------------------------
                                        Name: Walter L. Hawkins, Jr.
                                        Title: Vice President & Treasurer

                                        NEW MEXICO COAL RESOURCES, LLC

                                        By: /s/ Walter L. Hawkins, Jr.
                                            ------------------------------------
                                        Name: Walter L. Hawkins, Jr.
                                        Title: Vice President & Treasurer

                                        PEABODY ELECTRICITY, LLC

                                        By: /s/ Walter L. Hawkins, Jr.
                                            ------------------------------------
                                        Name: Walter L. Hawkins, Jr.
                                        Title: Vice President & Treasurer

<PAGE>

                                        PEABODY VENTURE FUND, LLC

                                        By: /s/ Walter L. Hawkins, Jr.
                                            ------------------------------------
                                        Name: Walter L. Hawkins, Jr.
                                        Title: Vice President & Treasurer

                                        POWDER RIVER RESOURCES, LLC

                                        By: /s/ Walter L. Hawkins, Jr.
                                            ------------------------------------
                                        Name: Walter L. Hawkins, Jr.
                                        Title: Vice President & Treasurer

                                        SCHOOL CREEK COAL COMPANY, LLC

                                        By: /s/ Walter L. Hawkins, Jr.
                                            ------------------------------------
                                        Name: Walter L. Hawkins, Jr.
                                        Title: Vice President & Treasurer

<PAGE>

                                   SCHEDULE 1

                          NEW GUARANTEEING SUBSIDIARIES

AMERICAN LAND DEVELOPMENT, LLC, a Delaware Limited Liability Company

AMERICAN LAND HOLDINGS OF ILLINOIS, LLC, a Delaware Limited Liability Company

AMERICAN LAND HOLDINGS OF INDIANA, LLC, a Delaware Limited Liability Company

CENTRAL STATES COAL RESERVES OF KENTUCKY, LLC, a Delaware Limited Liability
   Company

DYSON CREEK COAL COMPANY, LLC, a Delaware Limited Liability Company

EASTERN COAL COMPANY, LLC, a Delaware Limited Liability Company

MIDWEST COAL RESERVES OF ILLINOIS, LLC, a Delaware Limited Liability Company

MIDWEST COAL RESERVES OF INDIANA, LLC, a Delaware Limited Liability Company

MIDWEST COAL RESOURCES, LLC, a Delaware Limited Liability Company

NEW MEXICO COAL RESOURCES, LLC, a Delaware Limited Liability Company

PEABODY ELECTRICITY, LLC, a Delaware Limited Liability Company

PEABODY VENTURE FUND, LLC, a Delaware Limited Liability Company

POWDER RIVER RESOURCES, LLC, a Delaware Limited Liability Company

SCHOOL CREEK COAL COMPANY, LLC, a Delaware Limited Liability Company<PAGE>
                                                                     EXHIBIT 4.2

                          FIFTH SUPPLEMENTAL INDENTURE

          Fifth Supplemental Indenture (this "SUPPLEMENTAL INDENTURE"), dated as
of September 30, 2005, among the entities listed on Schedule 1 attached hereto
("GUARANTEEING SUBSIDIARIES"), each being a subsidiary of Peabody Energy
Corporation (or its permitted successor), a Delaware corporation (the
"COMPANY"), the Company, the other Subsidiary Guarantors (as defined in the
Indenture referred to herein) and U.S. Bank National Association, as Trustee
under the Indenture referred to below (the "TRUSTEE").

                                   WITNESSETH

          WHEREAS, the Company has heretofore executed and delivered to the
Trustee the First Supplemental Indenture dated as of March 23, 2004 to the
Indenture dated as of March 19, 2004, (the "BASE INDENTURE," and, together with
the First Supplemental Indenture, the "INDENTURE") providing for the issuance of
an unlimited amount of 5-7/8% Senior Notes due 2016 (the "NOTES"); as
supplemented by the Second Supplemental Indenture, dated as of April 22, 2004;
Third Supplemental Indenture, dated October 18, 2004; and Fourth Supplemental
Indenture, dated January 20, 2005;

          WHEREAS, the Indenture provides that under certain circumstances the
Guaranteeing Subsidiaries shall execute and deliver to the Trustee a
supplemental Indenture pursuant to which the Guaranteeing Subsidiaries shall
unconditionally guarantee all of the Company's Obligations under the Notes and
the Indenture on the terms and conditions set forth herein (the "SUBSIDIARY
GUARANTEE"); and

          WHEREAS, pursuant to Section 9.01 of the Base Indenture, the Trustee
is authorized to execute and deliver this Supplemental Indenture.

          NOW THEREFORE, in consideration of the foregoing and for other good
and valuable consideration, the receipt of which is hereby acknowledged, the
Guaranteeing Subsidiaries and the Trustee mutually covenant and agree for the
equal and ratable benefit of the Holders of the Notes as follows:

          1. CAPITALIZED TERMS. Capitalized terms used herein without definition
shall have the meanings assigned to them in the Indenture.

          2. AGREEMENT TO GUARANTEE. The Guaranteeing Subsidiaries hereby agrees
as follows:

          (a)  Along with all Subsidiary Guarantors named in the Indenture, to
               jointly and severally Guarantee to each Holder of a Note
               authenticated and delivered by the Trustee and to the Trustee and
               its successors and assigns, irrespective of the validity and
               enforceability of the Indenture, the Notes or the obligations of
               the Company hereunder or thereunder, that:

<PAGE>

               (i)  the principal of and interest on the Notes will be promptly
                    paid in full when due, whether at maturity, by acceleration,
                    redemption or otherwise, and interest on the overdue
                    principal of and interest on the Notes, if any, if lawful,
                    and all other obligations of the Company to the Holders or
                    the Trustee hereunder or thereunder will be promptly paid in
                    full or performed, all in accordance with the terms hereof
                    and thereof; and

               (ii) in case of any extension of time of payment or renewal of
                    any Notes or any of such other obligations, that same will
                    be promptly paid in full when due or performed in accordance
                    with the terms of the extension or renewal, whether at
                    stated maturity, by acceleration or otherwise. Failing
                    payment when due of any amount so guaranteed or any
                    performance so guaranteed for whatever reason, the
                    Subsidiary Guarantors shall be jointly and severally
                    obligated to pay the same immediately.

          (b)  The obligations hereunder shall be unconditional, irrespective of
               the validity, regularity or enforceability of the Notes or the
               Indenture, the absence of any action to enforce the same, any
               waiver or consent by any Holder of the Notes with respect to any
               provisions hereof or thereof, the recovery of any judgment
               against the Company, any action to enforce the same or any other
               circumstance which might otherwise constitute a legal or
               equitable discharge or defense of a Subsidiary Guarantor.

          (c)  The following is hereby waived: diligence presentment, demand of
               payment, filing of claims with a court in the event of insolvency
               or bankruptcy of the Company, any right to require a proceeding
               first against the Company, protest, notice and all demands
               whatsoever.

          (d)  This Subsidiary Guarantee shall not be discharged except by
               complete performance of the obligations contained in the Notes
               and the Indenture.

          (e)  If any Holder or the Trustee is required by any court or
               otherwise to return to the Company, the Subsidiary Guarantors, or
               any custodian, Trustee, liquidator or other similar official
               acting in relation to either the Company or the Subsidiary
               Guarantors, any amount paid by either to the Trustee or such
               Holder, this Subsidiary Guarantee, to the extent theretofore
               discharged, shall be reinstated in full force and effect.

          (f)  The Guaranteeing Subsidiaries shall not be entitled to any right
               of subrogation in relation to the Holders in respect of any
               obligations guaranteed hereby until payment in full of all
               obligations guaranteed hereby.

          (g)  As between the Subsidiary Guarantors, on the one hand, and the
               Holders and the Trustee, on the other hand, (x) the maturity of
               the obligations

                                       2

<PAGE>

               guaranteed hereby may be accelerated as provided in Article 6 of
               the First Supplemental Indenture for the purposes of this
               Subsidiary Guarantee, notwithstanding any stay, injunction or
               other prohibition preventing such acceleration in respect of the
               obligations guaranteed hereby, and (y) in the event of any
               declaration of acceleration of such obligations as provided in
               Article 6 of the First Supplemental Indenture, such obligations
               (whether or not due and payable) shall forthwith become due and
               payable by the Subsidiary Guarantors for the purpose of this
               Subsidiary Guarantee.

          (h)  The Subsidiary Guarantors shall have the right to seek
               contribution from any non-paying Subsidiary Guarantor so long as
               the exercise of such right does not impair the rights of the
               Holders under the Subsidiary Guarantee.

          (i)  Pursuant to Section 9.04 of the First Supplemental Indenture,
               after giving effect to any maximum amount and any other
               contingent and fixed liabilities that are relevant under any
               applicable Bankruptcy or fraudulent conveyance laws, and after
               giving effect to any collections from, rights to receive
               contribution from or payments made by or on behalf of any other
               Subsidiary Guarantor in respect of the obligations of such other
               Subsidiary Guarantor under Article 9 of the First Supplemental
               Indenture shall result in the obligations of such Subsidiary
               Guarantor under its Subsidiary Guarantee not constituting a
               fraudulent transfer or conveyance.

          3. EXECUTION AND DELIVERY. Each of the Guaranteeing Subsidiaries
agrees that the Subsidiary Guarantees shall remain in full force and effect
notwithstanding any failure to endorse on each Note a notation of such
Subsidiary Guarantee.

          4. GUARANTEEING SUBSIDIARY MAY CONSOLIDATE, ETC. ON CERTAIN TERMS.

          (a)  The Guaranteeing Subsidiaries may not consolidate with or merge
               with or into (whether or not such Subsidiary Guarantor is the
               surviving Person) another corporation, Person or entity whether
               or not affiliated with such Subsidiary Guarantor unless:

               (i)  subject to Section 9.04 of the First Supplemental Indenture,
                    the Person formed by or surviving any such consolidation or
                    merger (if other than a Subsidiary Guarantor or the Company)
                    unconditionally assumes all the obligations of such
                    Subsidiary Guarantor, pursuant to a supplemental Indenture
                    in form and substance reasonably satisfactory to the
                    Trustee, under the Notes, the Indenture and the Subsidiary
                    Guarantee on the terms set forth herein or therein; and

               (ii) immediately after giving effect to such transaction, no
                    Default or Event of Default exists.

          (b)  In case of any such consolidation, merger, sale or conveyance and
               upon the assumption by the successor corporation, by supplemental
               Indenture,

                                       3

<PAGE>

               executed and delivered to the Trustee and satisfactory in form to
               the Trustee, of the Subsidiary Guarantee endorsed upon the Notes
               and the due and punctual performance of all of the covenants and
               conditions of the Indenture to be performed by the Subsidiary
               Guarantor, such successor corporation shall succeed to and be
               substituted for the Subsidiary Guarantor with the same effect as
               if it had been named herein as a Subsidiary Guarantor. Such
               successor corporation thereupon may cause to be signed any or all
               of the Subsidiary Guarantees to be endorsed upon all of the Notes
               issuable hereunder which theretofore shall not have been signed
               by the Company and delivered to the Trustee. All the Subsidiary
               Guarantees so issued shall in all respects have the same legal
               rank and benefit under the Indenture as the Subsidiary Guarantees
               theretofore and thereafter issued in accordance with the terms of
               the Indenture as though all of such Subsidiary Guarantees had
               been issued at the date of the execution hereof.

          (c)  Except as set forth in Articles 4 and 5 of the First Supplemental
               Indenture, and notwithstanding clauses (a) and (b) above, nothing
               contained in the Indenture or in any of the Notes shall prevent
               any consolidation or merger of a Subsidiary Guarantor with or
               into the Company or another Subsidiary Guarantor, or shall
               prevent any sale or conveyance of the property of a Subsidiary
               Guarantor as an entirety or substantially as an entirety to the
               Company or another Subsidiary Guarantor.

          5. RELEASES.

          (a)  In the event of a sale or other disposition of all of the assets
               of any Subsidiary Guarantor, by way of merger, consolidation or
               otherwise, or a sale or other disposition of all to the capital
               stock of any Subsidiary Guarantor, then such Subsidiary Guarantor
               (in the event of a sale or other disposition, by way of merger,
               consolidation or otherwise, of all of the capital stock of such
               Subsidiary Guarantor) or the corporation acquiring the property
               (in the event of a sale or other disposition of all or
               substantially all of the assets of such Subsidiary Guarantor)
               will be released and relieved of any obligations under its
               Subsidiary Guarantee; provided that the Net Proceeds of such sale
               or other disposition are applied in accordance with the
               applicable provisions of the Indenture, including without
               limitation Section 4.10 of the Indenture. Upon delivery by the
               Company to the Trustee of an Officer's Certificate and an Opinion
               of Counsel to the effect that such sale or other disposition was
               made by the Company in accordance with the provisions of the
               Indenture, including without limitation Section 4.10 of the First
               Supplemental Indenture, the Trustee shall execute any documents
               reasonably required in order to evidence the release of any
               Subsidiary Guarantor from its obligations under its Subsidiary
               Guarantee.

                                       4

<PAGE>

          (b)  Any Subsidiary Guarantor not released from its obligations under
               its Subsidiary Guarantee shall remain liable for the full amount
               of principal of and interest on the Notes and for the other
               obligations of any Subsidiary Guarantor under the Indenture as
               provided in Article 9 of the First Supplemental Indenture.

          6. NO RECOURSE AGAINST OTHERS. No past, present or future director,
officer, employee, incorporator, stockholder or agent of the Guaranteeing
Subsidiaries, as such, shall have any liability for any obligations of the
Company or any Guaranteeing Subsidiaries under the Notes, any Subsidiary
Guarantees, the Indenture or this Supplemental Indenture or for any claim based
on, in respect of, or by reason of, such obligations or their creation. Each
Holder of the Notes by accepting a Note waives and releases all such liability.
The waiver and release are part of the consideration for issuance of the Notes.
Such waiver may not be effective to waive liabilities under the federal
securities laws and it is the view of the Commission that such a waiver is
against public policy.

          7. NEW YORK LAW TO GOVERN. THE LAW OF THE STATE OF NEW YORK SHALL
GOVERN AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE.

          8. COUNTERPARTS. The parties may sign any number of copies of this
Supplemental Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement.

          9. EFFECT OF HEADINGS. The Section headings herein are for convenience
only and shall not affect the construction hereof.

          10. THE TRUSTEE. The Trustee shall not be responsible in any manner
whatsoever for or in respect of the validity or sufficiency of this Supplemental
Indenture or for or in respect of the recitals contained herein, all of which
recitals are made solely by the Guaranteeing Subsidiaries and the Company.

                                       5

<PAGE>

          IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed and attested, all as of the date first above
written.

PEABODY ENERGY CORPORATION              US BANK NATIONAL ASSOCIATION
("COMPANY")                             ("TRUSTEE")

By: /s/ Walter L. Hawkins, Jr.          By: /s/ Philip G. Kane, Jr.
    ---------------------------------       ------------------------------------
Name: Walter L. Hawkins, Jr.            Name: Philip G. Kane, Jr.
Title: Vice President and Treasurer     Title: Vice President

EXISTING SUBSIDIARY GUARANTORS:

                                        AFFINITY MINING COMPANY
                                        AMERICAN LAND HOLDINGS OF KENTUCKY,
                                           LLC f/k/a BTU VENEZUELA, LLC
                                        APPALACHIA MINE SERVICES, LLC
                                        ARCLAR COMPANY, LLC
                                        ARID OPERATIONS INC.
                                        BEAVER DAM COAL COMPANY
                                        BIG RIDGE, INC.
                                        BIG SKY COAL COMPANY
                                        BLACK BEAUTY COAL COMPANY
                                        BLACK BEAUTY EQUIPMENT COMPANY
                                        BLACK BEAUTY HOLDING COMPANY, LLC
                                        BLACK BEAUTY MINING, INC.
                                        BLACK BEAUTY RESOURCES, INC.
                                        BLACK BEAUTY UNDERGROUND, INC.
                                        BLACK HILLS MINING COMPANY, LLC
                                        BLACK STALLION COAL COMPANY, LLC
                                        BLACK WALNUT COAL COMPANY
                                        BLUEGRASS COAL COMPANY
                                        BTU EMPIRE CORPORATION
                                        CABALLO COAL COMPANY
                                        CENTRAL STATES COAL RESERVES OF
                                           ILLINOIS, LLC
                                           f/k/a PEABODY DEVELOPMENT LAND
                                           HOLDINGS, LLC
                                        CHARLES COAL COMPANY, LLC
                                           f/k/a CHARLES COAL COMPANY
                                        CLEATON COAL COMPANY
                                        COAL PROPERTIES, LLC
                                           f/k/a COAL PROPERTIES CORP.
                                        COALSALES, LLC
                                        COALSALES II, LLC
                                        COALTRADE INTERNATIONAL, LLC
                                        COALTRADE, LLC

                                       6

<PAGE>

                                        COAL RESERVES HOLDING LIMITED LIABILITY
                                           COMPANY NO. 1
                                        COAL RESERVES HOLDING LIMITED LIABILITY
                                           COMPANY NO. 2
                                        COLONY BAY COAL COMPANY
                                        COLORADO YAMPA COAL COMPANY
                                        COOK MOUNTAIN COAL COMPANY, LLC
                                           f/k/a COOK MOUNTAIN COAL COMPANY
                                        COTTONWOOD LAND COMPANY
                                        COULTERVILLE COAL COMPANY, LLC
                                           f/k/a WILLIAMSVILLE COAL COMPANY, LLC
                                        CYPRUS CREEK LAND COMPANY
                                        CYPRUS CREEK LAND RESOURCES, LLC
                                        DIXON MINING COMPANY, LLC
                                        DODGE HILL HOLDING JV, LLC
                                        DODGE HILL OF KENTUCKY, LLC
                                        DODGE HILL MINING COMPANY, LLC
                                        EACC CAMPS, INC.
                                        EAGLE COAL COMPANY
                                        EASTERN ASSOCIATED COAL, LLC
                                           f/k/a EASTERN ASSOCIATED COAL CORP.
                                        EASTERN ROYALTY CORP.
                                        EMPIRE MARINE, LLC
                                        FALCON COAL COMPANY
                                        GALLO FINANCE COMPANY
                                        GOLD FIELDS CHILE, LLC
                                           f/k/a GOLD FIELDS CHILE, S.A.
                                        GOLD FIELDS MINING, LLC
                                        GOLD FIELDS ORTIZ, LLC
                                           f/k/a GOLD FIELDS OPERATING CO. -
                                              ORTIZ
                                        GRAND EAGLE MINING, INC.
                                        HAYDEN GULCH TERMINAL, INC.
                                        HIGHLAND MINING COMPANY, LLC
                                           f/k/a HIGHLAND MINING COMPANY
                                        HIGHWALL MINING SERVICES COMPANY
                                        HILLSIDE MINING COMPANY
                                        HMC MINING, LLC
                                        INDEPENDENCE MATERIAL HANDLING
                                           COMPANY
                                        INDIAN HILL COMPANY
                                        INTERIOR HOLDINGS, LLC
                                           f/k/a INTERIOR HOLDINGS CORP.
                                        JAMES RIVER COAL TERMINAL, LLC
                                           f/k/a JAMES RIVER COAL TERMINAL
                                              COMPANY
                                        JARRELL'S BRANCH COAL COMPANY

                                       7

<PAGE>

                                        JUNIPER COAL COMPANY
                                        KANAWHA RIVER VENTURES I, LLC
                                        KAYENTA MOBILE HOME PARK, INC.
                                        LOGAN FORK COAL COMPANY

                                        MARTINKA COAL COMPANY, LLC
                                           f/k/a MARTINKA COAL COMPANY
                                        MIDCO SUPPLY AND EQUIPMENT
                                           CORPORATION
                                        MIDWEST COAL ACQUISITION CORP.
                                        MOUNTAIN VIEW COAL COMPANY, LLC
                                           f/k/a MOUNTAIN VIEW COAL COMPANY
                                        MUSTANG ENERGY COMPANY, L.L.C.
                                        NORTH PAGE COAL CORP.
                                        OHIO COUNTY COAL COMPANY
                                        PATRIOT COAL COMPANY, L.P.
                                        PDC PARTNERSHIP HOLDINGS, INC.
                                        PEABODY AMERICA, INC.
                                        PEABODY ARCHVEYOR, L.L.C.
                                        PEABODY COAL COMPANY, LLC
                                           f/k/a PEABODY COAL COMPANY
                                        PEABODY DEVELOPMENT COMPANY, LLC
                                        PEABODY ENERGY GENERATION HOLDING
                                           COMPANY
                                        PEABODY ENERGY INVESTMENTS, INC.
                                        PEABODY ENERGY SOLUTIONS, INC.
                                        PEABODY HOLDING COMPANY, INC.
                                        PEABODY INVESTMENTS CORP.
                                        PEABODY NATURAL GAS, LLC
                                        PEABODY NATURAL RESOURCES COMPANY
                                        PEABODY POWERTREE INVESTMENTS, LLC
                                        PEABODY RECREATIONAL LANDS, L.L.C.
                                        PEABODY SOUTHWESTERN COAL COMPANY
                                        PEABODY TERMINALS, LLC
                                           f/k/a PEABODY TERMINALS, INC.
                                        PEABODY VENEZUELA COAL CORP.
                                        PEABODY-WATERSIDE DEVELOPMENT, L.L.C.
                                        PEABODY WESTERN COAL COMPANY
                                        PEC EQUIPMENT COMPANY, LLC
                                        PHC ACQUISITION CORP.
                                           f/k/a RIO ESCONDIDO COAL CORP.
                                        PINE RIDGE COAL COMPANY, LLC
                                           f/k/a PINE RIDGE COAL COMPANY
                                        POINT PLEASANT DOCK COMPANY, LLC
                                        POND CREEK LAND RESOURCES, LLC
                                        POND RIVER LAND COMPANY

                                       8

<PAGE>

                                        PORCUPINE PRODUCTION, LLC
                                        PORCUPINE TRANSPORTATION, LLC
                                        POWDER RIVER COAL COMPANY
                                        PRAIRIE STATE GENERATING COMPANY, LLC
                                        RANDOLPH LAND HOLDING COMPANY, LLC
                                        RIVERS EDGE MINING, INC.
                                        RIVERVIEW TERMINAL COMPANY
                                        SENECA COAL COMPANY
                                        SENTRY MINING COMPANY
                                        SHOSHONE COAL CORPORATION
                                        SNOWBERRY LAND COMPANY
                                        STAR LAKE ENERGY COMPANY, L.L.C.
                                        STERLING SMOKELESS COAL COMPANY, LLC
                                           f/k/a STERLING SMOKELESS COAL
                                              COMPANY
                                        SUGAR CAMP PROPERTIES
                                        THOROUGHBRED, L.L.C.
                                        THOROUGHBRED GENERATING COMPANY, LLC
                                        THOROUGHBRED MINING COMPANY, L.L.C.
                                        TWENTYMILE COAL COMPANY
                                        UNION COUNTY COAL CO., LLC
                                        YANKEETOWN DOCK, LLC
                                           f/k/a YANKEETOWN DOCK CORPORATION

                                        By: /s/ Walter L. Hawkins, Jr.
                                            ------------------------------------
                                        Name: Walter L. Hawkins, Jr.
                                        Title: Vice President

ADDITIONAL GUARANTORS:

                                        AMERICAN LAND DEVELOPMENT, LLC

                                        By: /s/ Walter L. Hawkins, Jr.
                                            ------------------------------------
                                        Name: Walter L. Hawkins, Jr.
                                        Title: Vice President & Treasurer

                                       9

<PAGE>

                                        AMERICAN LAND HOLDINGS OF ILLINOIS, LLC

                                        By: /s/ Walter L. Hawkins, Jr.
                                            ------------------------------------
                                        Name: Walter L. Hawkins, Jr.
                                        Title: Vice President & Treasurer

                                        AMERICAN LAND HOLDINGS OF INDIANA, LLC

                                        By: /s/ Walter L. Hawkins, Jr.
                                            ------------------------------------
                                        Name: Walter L. Hawkins, Jr.
                                        Title: Vice President & Treasurer

                                        CENTRAL STATES COAL RESERVES OF
                                        KENTUCKY, LLC

                                        By: /s/ Walter L. Hawkins, Jr.
                                            ------------------------------------
                                        Name: Walter L. Hawkins, Jr.
                                        Title: Vice President & Treasurer

                                        DYSON CREEK COAL COMPANY, LLC

                                        By: /s/ Walter L. Hawkins, Jr.
                                            ------------------------------------
                                        Name: Walter L. Hawkins, Jr.
                                        Title: Vice President & Treasurer

                                        EASTERN COAL COMPANY, LLC

                                        By: /s/ Walter L. Hawkins, Jr.
                                            ------------------------------------
                                        Name: Walter L. Hawkins, Jr.
                                        Title: Vice President & Treasurer

                                       10

<PAGE>

                                        MIDWEST COAL RESERVES OF ILLINOIS, LLC

                                        By: /s/ Walter L. Hawkins, Jr.
                                            ------------------------------------
                                        Name: Walter L. Hawkins, Jr.
                                        Title: Vice President & Treasurer

                                        MIDWEST COAL RESERVES OF INDIANA, LLC

                                        By: /s/ Walter L. Hawkins, Jr.
                                            ------------------------------------
                                        Name: Walter L. Hawkins, Jr.
                                        Title: Vice President & Treasurer

                                        MIDWEST COAL RESOURCES, LLC

                                        By: /s/ Walter L. Hawkins, Jr.
                                            ------------------------------------
                                        Name: Walter L. Hawkins, Jr.
                                        Title: Vice President & Treasurer

                                        NEW MEXICO COAL RESOURCES, LLC

                                        By: /s/ Walter L. Hawkins, Jr.
                                            ------------------------------------
                                        Name: Walter L. Hawkins, Jr.
                                        Title: Vice President & Treasurer

                                        PEABODY ELECTRICITY, LLC

                                        By: /s/ Walter L. Hawkins, Jr.
                                            ------------------------------------
                                        Name: Walter L. Hawkins, Jr.
                                        Title: Vice President & Treasurer

                                        PEABODY VENTURE FUND, LLC

                                        By: /s/ Walter L. Hawkins, Jr.
                                            ------------------------------------
                                        Name: Walter L. Hawkins, Jr.
                                        Title: Vice President & Treasurer

                                       11

<PAGE>

                                        POWDER RIVER RESOURCES, LLC

                                        By: /s/ Walter L. Hawkins, Jr.
                                            ------------------------------------
                                        Name: Walter L. Hawkins, Jr.
                                        Title: Vice President & Treasurer

                                        SCHOOL CREEK COAL COMPANY, LLC

                                        By: /s/ Walter L. Hawkins, Jr.
                                            ------------------------------------
                                        Name: Walter L. Hawkins, Jr.
                                        Title: Vice President & Treasurer

                                       12

<PAGE>

                                   SCHEDULE 1

                          NEW GUARANTEEING SUBSIDIARIES

AMERICAN LAND DEVELOPMENT, LLC, a Delaware Limited Liability Company

AMERICAN LAND HOLDINGS OF ILLINOIS, LLC, a Delaware Limited Liability Company

AMERICAN LAND HOLDINGS OF INDIANA, LLC, a Delaware Limited Liability Company

CENTRAL STATES COAL RESERVES OF KENTUCKY, LLC, a Delaware Limited Liability
   Company

DYSON CREEK COAL COMPANY, LLC, a Delaware Limited Liability Company

EASTERN COAL COMPANY, LLC, a Delaware Limited Liability Company

MIDWEST COAL RESERVES OF ILLINOIS, LLC, a Delaware Limited Liability Company

MIDWEST COAL RESERVES OF INDIANA, LLC, a Delaware Limited Liability Company

MIDWEST COAL RESOURCES, LLC, a Delaware Limited Liability Company

NEW MEXICO COAL RESOURCES, LLC, a Delaware Limited Liability Company

PEABODY ELECTRICITY, LLC, a Delaware Limited Liability Company

PEABODY VENTURE FUND, LLC, a Delaware Limited Liability Company

POWDER RIVER RESOURCES, LLC, a Delaware Limited Liability Company

SCHOOL CREEK COAL COMPANY, LLC a Delaware Limited Liability Company

                                       13

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