Cloud Peak Energy Voluntarily Files for Chapter 11

Operations to Continue as Normal and Marketing and Sale Process to
Continue

Secures Approximately $35 Million in Debtor-in-Possession Financing

Enters into Sale and Plan Support Agreement with Certain Creditors

GILLETTE, Wyo.–(BUSINESS WIRE)–Cloud Peak Energy Inc. (OTC: CLDP) (“Cloud Peak Energy” or the
“Company”), the only pure-play Powder River Basin (“PRB”) coal company,
announced today that it has filed voluntary petitions under Chapter 11
of the United States Bankruptcy Code in the United States Bankruptcy
Court for the District of Delaware.

Cloud Peak Energy intends to continue a marketing process for all of its
assets. Cloud Peak Energy expects its mines will continue normal
operations throughout the process, safely and efficiently meeting all
customer commitments.

Colin Marshall, President and Chief Executive Officer of Cloud Peak
Energy, commented, “Over the past several months, Cloud Peak Energy has
thoroughly evaluated strategic alternatives to address the challenging
market conditions in our industry. We believe, at this time, that a sale
process in Chapter 11 will provide the best opportunity to maximize
value for Cloud Peak Energy.”

Mr. Marshall continued, “While we undertake this process, Cloud Peak
Energy remains a reliable source of high-quality coal for customers. We
thank our employees for their continued hard work and dedication, and
appreciate the cooperation of our business partners and support of our
customers as we work through this process.”

In conjunction with the filing, and subject to court approval, Cloud
Peak Energy has received a commitment for approximately $35 million in
debtor-in-possession (“DIP”) financing from certain of the Company’s
prepetition secured noteholders. The Company expects $10 million of the
total DIP financing will be available on an interim basis. The DIP
financing, combined with the Company’s cash on hand and funds generated
from ongoing operations, are expected to provide sufficient liquidity
for the Company to continue operating in the ordinary course during the
sale process.

The Company also announced that it has entered into an Amended and
Restated Sale and Plan Support Agreement (the “Support Agreement”) with
holders of approximately 62% in dollar amount of the Company’s secured
notes due 2021 (the “2021 Notes”) and more than 50% in dollar amount of
the Company’s unsecured notes due 2024. The Support Agreement reflects,
among other things, the support from two of the Company’s key creditor
constituencies for the Company’s sale process, as well as the consent of
the holders of the 2021 Notes to the Company’s use of cash collateral
and priming liens to allow for the DIP financing.

Cloud Peak Energy has filed a number of customary motions with the court
seeking authorization to support its operations while this process is
ongoing, including authority to continue payment of employee wages,
salaries and benefits without interruption. The Company intends, subject
to court approval, to pay vendors, suppliers and other providers
essential to the Company’s business in full for goods and services
provided after the filing date. The Company also expects to continue
entering into and fulfilling orders under sales contracts with customers
in the ordinary course of business. The Company expects to receive court
approval for these requests.

Additional information is available at Cloud Peak Energy’s website at https://cloudpeakenergy.com.
Court filings and information about the claims process are available at https://cases.primeclerk.com/cloudpeak,
by calling the Company’s claims agent, Prime Clerk LLC, toll-free at
844-217-3067 or local at 347-761-3264 or emailing cloudpeakinfo@primeclerk.com.

Vinson & Elkins LLP is serving as legal advisor, Centerview Partners LLC
is serving as investment banker and FTI Consulting, Inc. is serving as
financial advisor to Cloud Peak Energy. Davis Polk & Wardwell LLP is
serving as legal advisor and Houlihan Lokey, Inc. is serving as
financial advisor to the ad hoc group of holders of 2021 Notes and the
DIP lenders.

About Cloud Peak Energy®

Cloud Peak Energy Inc. (OTC:CLDP) is headquartered in Wyoming and is the
only pure-play Powder River Basin coal company. As one of the safest
coal producers in the nation, Cloud Peak Energy mines low sulfur,
subbituminous coal and provides logistics supply services. The Company
owns and operates three surface coal mines in the PRB, the lowest cost
major coal producing region in the nation. The Antelope and Cordero Rojo
mines are located in Wyoming and the Spring Creek Mine is located in
Montana. In 2018, Cloud Peak Energy sold approximately 50 million tons
from its three mines to customers located throughout the U.S. and around
the world. Cloud Peak Energy also owns rights to substantial undeveloped
coal and complementary surface assets in the Northern PRB, further
building the Company’s long-term position to serve Asian export and
domestic customers. With approximately 1,300 total employees, the
Company is widely recognized for its exemplary performance in its safety
and environmental programs. Cloud Peak Energy is a sustainable fuel
supplier for approximately two percent of the nation’s electricity.

Cautionary Note Regarding Forward Looking Statements

This release contains “forward-looking statements” within the meaning of
the safe harbor provisions of Section 27A of the Securities Act of 1933
and Section 21E of the Securities Exchange Act of 1934. Forward-looking
statements are not statements of historical facts and often contain
words such as “may,” “will,” “expect,” “believe,” “anticipate,” “plan,”
“estimate,” “seek,” “could,” “should,” “intend,” “potential,” or words
of similar meaning. Forward-looking statements are based on management’s
current expectations, beliefs, assumptions and estimates regarding our
company, industry, economic conditions, government regulations and
energy policies and other factors. Forward-looking statements may
include, for example, statements regarding the Board of Directors’
strategic evaluation process, our operational and financial priorities,
our responses to the structural changes in the U.S. coal industry, our
efforts to position our company for future growth opportunities, and
other statements regarding our plans, strategies, prospects and
expectations concerning our business, operating results, financial
condition, liquidity and other matters that do not relate strictly to
historical facts. These statements are subject to significant risks,
uncertainties, and assumptions that are difficult to predict and could
cause actual results to differ materially and adversely from those
expressed or implied in the forward-looking statements, including risks
and uncertainties regarding our ability to continue as a going concern,
our ability to successfully complete a sale process under Chapter 11;
potential adverse effects of the Chapter 11 cases on our liquidity and
results of operations; our ability to obtain timely approval by the
United States Bankruptcy Court for the District of Delaware (the
“Court”) with respect to the motions filed in the Chapter 11 cases;
objections to our sale process, DIP financing or other pleadings filed
that could protract the Chapter 11 cases; employee attrition and our
ability to retain senior management and other key personnel due to the
distractions and uncertainties, including our ability to provide
adequate compensation and benefits during the Chapter 11 cases; our
ability to comply with the restrictions imposed by our Accounts
Receivable Securitization Program (the “A/R Securitization Program”),
the DIP financing and other financing arrangements; our ability to
maintain relationships with suppliers, customers, employees and other
third parties and regulatory authorities as a result of the Chapter 11
filing; the effects of the bankruptcy petitions on our company and on
the interests of various constituents, including holders of our common
stock; the Court’s rulings in the Chapter 11 cases, including the
approvals of the Support Agreement, an amendment to the A/R
Securitization Program and the DIP financing, and the outcome of the
Chapter 11 cases generally; the length of time that we will operate
under Chapter 11 protection and the continued availability of operating
capital during the pendency of the proceedings; risks associated with
third party motions in the Chapter 11 cases, which may interfere with
our ability to consummate a sale; and increased administrative and legal
costs related to the Chapter 11 process and other litigation and
inherent risks involved in a bankruptcy process. Forward-looking
statements are also subject to the risk factors and cautionary language
described from time to time in the reports and registration statements
we file with the Securities and Exchange Commission, including those in
Item 1A – Risk Factors in our most recent Form 10-K and any updates
thereto in our Forms 10-Q and current reports on Form 8-K. Additional
factors, events, or uncertainties that may emerge from time to time, or
those that we currently deem to be immaterial, could cause our actual
results to differ, and it is not possible for us to predict all of them.
We make forward-looking statements based on currently available
information, and we assume no obligation to, and expressly disclaim any
obligation to, update or revise publicly any forward-looking statements
made in this release, whether as a result of new information, future
events or otherwise, except as required by law.

Contacts

Cloud Peak Energy Inc.
(720) 566-2932
Investor Relations

Meaghan
Repko / Andrew Squire
Joele Frank, Wilkinson Brimmer Katcher
(212)
355-4449