Rentech and Peabody enter into development and coal supply agreements for first commercial U.S. coal-to-liquids facility

Los Angeles, CA, May 29, 2007 — Rentech Inc. announced that it has signed agreements with Peabody Energy whereby Peabody will fund up to $10 million of the engineering and development costs for Rentech’s planned coal-to-liquids project at its Rentech Energy Midwest Corp. facility (REMC) in Illinois. Additionally, under the agreements, Peabody will supply the facility with nearly 1 million tons of coal annually and obtain the right to purchase a 20% equity interest in the project.

The project is anticipated to be the first commercial coal-to-liquids facility in the United States. It entails converting the existing REMC natural gas fed ammonia fertilizer plant into a coal-to-liquids and ammonia facility that will use clean coal gasification technology and Rentech’s patented and proprietary Fischer-Tropsch (FT) process (the Rentech Process) to produce transportation and aviation fuels and fertilizer. The company believes that converting from natural gas to coal will reduce its cost of operations.

Under the terms of a long-term agreement, Peabody will supply the project with nearly 1 million tons of coal annually from its Illinois operations, providing a reliable source of fuel for the project.

Upon the expected completion of the plant conversion by 2010, REMC is anticipated to produce at least 1,250 barrels per day or 17.8 million gallons of clean Fischer-Tropsch fuels annually. The facility is also projected to produce approximately 545,000 tons of ammonia and other nitrogen fertilizer products per year and to be developed as a “carbon capture ready” facility.

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