Coal

[mhlld]

National Coal Buy Rating in Initiating Coverage by Dutton Associates

EL DORADO HILLS, Calif.--(BUSINESS WIRE)--May 12, 2005--Dutton Associates initiates coverage of National Coal Corporation (Nasdaq:NCOC - News) with a Buy rating and an $8.64 price target. The 26-page report by Dutton senior analyst Richard Wolfe, CFA, is available at www.jmdutton.com, as well as from First Call, Bloomberg, Zacks, Multex, and other leading financial portals.
National Coal, a Central Appalachian (CAPP) coal producer established in 2003, grew rapidly during 2004 and is now poised for a leap to critical mass in 2005, a year in which the Company should turn cash-flow positive and begin posting what we anticipate will become a record of steady earnings growth. The basis for the Company's growth is a formula for rolling-up available CAPP properties through a combination of effective financing strategies, farsighted management with long industry experience, and leveraging today's favorable coal market economics. In the last six months, NCC has turned a corner in terms of contract sales arrangements and now has most of its scheduled output committed for purchase by large, high-quality utility and industrial customers. We anticipate more favorable contract news from the Company scheduling the sale of its production out over the next two to three years. Geography gives NCC a competitive edge, thanks to the location of its key property, the Eastern Tennessee New River Tract, which gives it direct access to all utility and large industrial customers in states to the south. The New River Tract also puts the Company in a favorable position for developing future coal reserves, since it is a single large block of acreage, uninterrupted by third-party properties and with all coal mineral rights owned outright by NCC. Our rating and target price of $8.64 are based on our multi-year cash flow analysis of NCC and reflect the comparative prospects of NCC's peer companies in the coal industry. We feel that NCC represents an opportunity for investors in comparison to other stocks in the coal sector.

About Dutton Associates

Dutton Associates is one of the largest independent investment research firms in the U.S. Its 27 senior analysts are primarily CFAs and have expertise in many industries. Dutton Associates provides continuing analyst coverage of over 95 enrolled companies, and its research, estimates, and ratings are carried in all the major databases serving institutions and online investors.

The cost of enrollment in our one-year continuing research program is US $33,000 prepaid for 4 Research Reports, typically published quarterly, and requisite Research Notes. Dutton Associates received $33,000 from the Company for 4 Research Reports with coverage commencing on 5/12/2005. We do not accept payment of our fees in company stock. Our principals and analysts are prohibited from owning or trading in securities of covered companies. The views expressed in this research report accurately reflect the analyst's personal views about the subject securities or issuer. Neither the analyst's compensation nor the compensation received by us is in any way related to the specific ratings or views contained in this research report or note. Please read full disclosures and analyst background at www.jmdutton.com before investing.



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Contact:
Dutton Associates, LLC
John M. Dutton, 916-941-8119

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