FORM OF NON-QUALIFIED STOCK OPTION AGREEMENT

Exhibit 10.5

Form of Award Agreement
(Non-Qualified Stock Option)

Name of employee:		(Employee name)
Name of plan:		1997 Stock Incentive Plan, as amended
Date of option grant:		(Grant date)
Number of option shares:		x,xxx
Option price per share:		$xx.xx
Vesting schedule:		xxx shares                     xx/xx/20xx
		xxx shares                     xx/xx/20xx
		xxx shares                     xx/xx/20xx
Expiration date:		xx/xx/20xx

     Arch Coal, Inc. (“Arch Coal”) hereby confirms this grant of a non-qualified stock option to purchase shares of Arch Coal, Inc. common stock (the “Option”) to the above-named employee (“Employee”). The terms of this Award Agreement and the 1997 Stock Incentive Plan, as amended (the “Plan”), shall govern the Option all respects. Capitalized terms used in this Award Agreement but not otherwise defined herein shall have the meanings assigned to them in the Plan.

     Subject to the terms of the Plan, the Option granted hereunder shall vest and becom