Celsius Resources Limited — Interim / Quarterly Report 2013

Mar 17, 2013

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A.B.N. 95 009 162 949

HALF-YEAR REPORT

31 DECEMBER 2012

CONTENTS

Corporate Directory	1
Directors’ Report	2
Consolidated Statement of Comprehensive Income	7
Consolidated Statement of Financial Position	8
Consolidated Statement of Changes in Equity	9
Consolidated Statement of Cash Flows	10
Notes to the Financial Statements	11
Directors’ Declaration	15
Independent Review Report	16
Auditor’s Independence Declaration	18

CELSIUS COAL LIMITED CORPORATE DIRECTORY

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DIRECTORS

SHARE REGISTRY

Alexander Molyneux – Executive Chairman Grant Thomas – Managing Director William Oliver - Non Executive Director Ranko Matic – Non Executive Director

Computershare Investor Services Ltd Level 2, Reserve Bank Building 45 St George’s Terrace PERTH WA 6000 1300 787 272

COMPANY SECRETARY

Ranko Matic

STOCK EXCHANGE LISTING

AUDITORS

RSM Bird Cameron Partners 8 St Georges Terrace PERTH WA 6000

Australian Securities Exchange Limited (Home Branch - Perth) ASX Code: CLA

REGISTERED OFFICE

BANKERS

National Australia Bank 1/1238 Hay St WEST PERTH WA 6005

Level 1 12 Kings Park Road WEST PERTH WA 6005

CONTACTS

SOLICITORS

Steinepreis Paganin Level 4 The Read Buildings 16 Milligan Street PERTH WA 6000 Ph: +61 8 9321 4000 Fax: +61 8 9321 4333

Telephone: +61 8 9226 4500 Facsimile: +61 8 9226 4300 E-mail: info@celsiuscoal.com.au Website: www.celsiuscoal.com.au

Page 1

CELSIUS COAL LIMITED DIRECTORS’ REPORT

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Your Directors present their report together with the financial report on the consolidated entity, consisting of Celsius Coal Limited and the entities it controlled at the end of, or during the half-year ended 31 December 2012.

Directors

The Directors in office at the date of this report and at any time during the half-year are as follows: Directors were in office for the entire period unless otherwise stated.

Alexander Molyneux Executive Chairman (appointed 1 December 2012) Peter O’Malley Non-Executive Chairman (resigned 5 November 2012) Grant Thomas Executive Director Bill Oliver Non-Executive Director Ranko Matic Non-Executive Director (appointed 5 November 2012)

Review of Operations

Corporate:

The consolidated net loss of the Company after income tax for the six months ended 31 December 2012 amounted to $1,686,560 (December 2011: profit $643,571).

On 29 August 2012 the Company announced it had secured $4m in a capital raising. Tranche 1 for $1.9m was completed in September, with 95m ordinary shares being issued on 13 September 2012. This issue was ratified by shareholders at the General Meeting held on 4 October 2012. Tranche 2 for $2.1m was completed in October 2012, with 105m ordinary shares being issued on 19 October 2012. This issue was approved by shareholders at the General Meeting held on 4 October 2012.

On 4 October 2012 the Company held a General Meeting, where the shareholders approved (among other things) the proposed name change from View Resources Limited to Celsius Coal Limited. During this General Meeting the shareholders approved a change to the scale of activities of the Company to enable the completion of the Kokkia Coal acquisition, which was originally announced to the market on 18 June 2012. Part of this acquisition was the issue of Performance Shares and Consideration Shares, which were also approved to be issued to the vendors of Kokkia Coal. Accordingly the following securities were issued on 25 October 2012, which completed the Kokkia Coal transaction:

500,000,000 Ordinary Shares 200,000,000 Class A Performance Shares 200,000,000 Class B Performance Shares 200,000,000 Class C Performance Shares 150,000,000 Class D Performance Shares 150,000,000 Class E Performance Shares

On 1 November 2012, 30,000,000 Class A options were issued to directors as approved at General Meeting held on 4 October 2012. They were issued with an exercise price of 2 cents and with an expiry date of 31 October 2014.

On 29[th] November 2012 the Company announced the appointment of Mr Alexander Molyneux as Executive Chairman. Mr Molyneux was selected due to his experience and his track record, to assist the Company specifically in progressing its existing coking and thermal coal projects in the Kyrgyz Republic towards commercialisation.

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CELSIUS COAL LIMITED DIRECTORS’ REPORT

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On 4 January 2013, the Company issued the following securities relating to the Kokkia transaction but effective 31 December 2012 as approved at their General Meeting on 4 October 2012: 15,000,000 Ordinary Shares 5,400,000 Class A Performance Shares 5,400,000 Class B Performance Shares 5,400,000 Class C Performance Shares 5,400,000 Class D Performance Shares 5,400,000 Class E Performance Shares

Exploration Activities

Kyrgyzstan Coal Projects

A confirmatory drill program to test the Company’s exploration prospects at its Uzgen Basin Coking Coal Project located in Central Kyrgyzstan was carried out during the reporting period. The Company completed seven drill holes at Kargasha for 3,230.5 metres and three at the Min Teke for 560.4 metres (Figure 1). All holes successfully intersected coal seams with intercepts attached (these intercepts have been confirmed by laboratory analysis and were released on 31[st] January 2013). The Company has derived an Exploration Target of 501 to 700 million tonnes of coal for the Uzgen Basin Project (see below) and is currently completing its maiden JORC coal resource for the Project based on the results of the 2012 drill programme. Full details of the coal intersections are tabled in ASX Announcement dated 31[st] January 2013:

Coal Quality Analysis Results

Results of raw coal sample testing from Kargasha were reported on 9[th] October 2012, 11[th] December 2012 and 31[st] January 2013. These laboratory results confirm coal intersected in all drill holes in the Kargasha include coking coal, and also validate the thickness of coal intersected in drilling from visual inspection (reported 9[th] November 2012).

All coal samples show very good thermal characteristics with high GCV[ad] (air dried gross calorific value), low IM (Inherent Moisture), and low to moderate phosphorus (P[d] ) and acceptable total sulphur (TS[d] ). Coking coals with low concentrations of deleterious elements such as phosphorus and total sulphur are favoured by steel producers.

Coking coal potential is demonstrated by the results from Free Swelling Index (FSI) coking tests, with 46 of 49 coal samples from drillholes DD12TK001-DD12TK007 submitted for FSI tests returning results greater than 4.5. Given the spacing of drill holes (Figure 1) it is possible that a substantial portion of the coal at Kargasha has potential to be used as coking coal.

Full details on assay results are tabled in ASX Announcements on 9[th] October 2012, 12 December 2012 and 31[st] January 2013.

Laboratory results of small scale float/sink testing of 26 coal and coal composite samples with raw ash>10% were released on 12[th] February 2013 and show excellent potential for beneficiation. Samples were from the seven drill holes completed in 2012 (DD12TK001 to DD12TK007). Full details of results are tabled in ASX Announcement dated 12[th] February 2013.

Overall general conclusions from this test work on the 26 samples are that at a cumulative floats density of 1.5 the:

• Theoretical yield ranges from 41% to 94% with 84% of values being >60%.

• Product ash ranges from 2.5% to 9.4% with over 40% of values being between 5 and 6%.

• FSI ranges from 6.5 to 8.5 with 64% being >7.

• Theoretical yield has a strong correlation with raw (head) ash.

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CELSIUS COAL LIMITED DIRECTORS’ REPORT

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Figure 1. Geology Map of Kargasha showing Celsius 2012 drilling, coal intersections and historical Soviet-era drilling.

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Page 4

CELSIUS COAL LIMITED DIRECTORS’ REPORT

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Testing is continuing to further determine the coking characteristics, ash compositions and ultimate analyses of these samples.

Interim analyses for drill holes DD12MT001, DD12MT002 and DD12MT003 from Min Teke were reported on the 31[st] January 2013 with further testing continuing. This work was undertaken in the internationally accredited SGS laboratory in Novokuznetsk using industry standard analytical procedures. Results of raw coal sample testing show consistently high gross calorific values, the majority of values are in excess of 6,000 Kcal/Kg with 10 samples exceeding 7,000 Kcal/Kg. Of a total of 14 FSI analyses all but 3 show results in excess of 6.0. It is probable that the lower FSI values are related to the depth of oxidation.

Mining – Sary Mogol (Alai Range Project) & Min Teke (Uzgen Basin Coking Coal Project) During the reporting period the company carried out open pit mining on the Min Teke and Sary Mogol mining leases to comply with the conditions of the Company’s Development / Mining License. The Company anticipates generating a small cash flow from these activities.

In January 2013 the Kyrgyz Republic Ministry of Transport announced the completion of the feasibility study for the Trans-Asia Railway. Based on the announcement and related reports, the study is now being translated into Kygyz and Russian (the official languages of Kyrgyz Republic) to allow for more formal discussions to take place regarding implementation. Completion of the feasibility study is in line with various statements made by the governments of People’s Republic of China and Kyrgyz Republic in September and December 2012 regarding accelerating the project. The railway is currently anticipated to be completed by the end of 2016 and the current planned route comes within 10 kilometres of Celsius’ Uzgen Basin Coking Coal Project.

Celsius has also undertaken a review of transport options to facilitate coal export prior to completion of the Trans-Asia Railway. For the Uzgen Basin coking coal projects, two options exist for export to China: one route of approximately 385km via Osh and then to export via the Irkeshtam border crossing between Kyrgyz Republic and China; and the second being approximately 465km via Naryn for export via the Torugart border crossing (shown on Figure 2 below). Both options appear feasible. However, the route via Osh is more favourable based on road conditions and distance. Generally paved and rehabilitated roads are available on the route via Osh. Utilizing this route, the Company estimates a transport cost of approximately $10 per tonne to the Kyrgyz Republic-China border.

Carnilya Hill Joint Venture

Celsius (through View Nickel Pty Ltd) owns a 30% joint venture interest in the Carnilya Hill Joint Venture in Western Australia with Mincor Resources NL ( Joint Venture ). Mincor Resources NL ( Mincor , ASX:MCR) is the operator of the Carnilya Hill JV. The tenements covered by the Camilya Hill Joint Venture (JV) include Mining Licences M26/47, M26/48, M26/49 and M26/453.

The Carnilya Hill site is currently on care and maintenance. The Joint Venture will incur nominal running costs to ensure the site is kept secure, safe and well maintained. Exploration continues on the tenements comprising the Joint Venture, and is managed by Mincor as the Operator of the Joint Venture. Results from exploration programmes will be released as they become available.

Regional Nickel Exploration

On 1[st] November 2012 tenement E39/1684 in the Eastern Goldfields region of Western Australia was granted to the Company’s subsidiary View Nickel Pty Ltd. The Company continues to compile all data relevant to E39/1684 as well as E39/1641. The tenements are located near to Minara Resources’ Murrin Murrin mine and the NiWest operation currently under development by GME Resources Ltd and are believed to have potential for both nickel laterite and nickel sulphide mineralisation. In due course, the Company may consider spinning out its nickel interests into a new public vehicle listed on the ASX.

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CELSIUS COAL LIMITED DIRECTORS’ REPORT

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Events after the Balance Sheet Date

On 7 February 2013, the Company announced to the market that it had secured commitments for $10m in funding from the Blumont Group Limited (‘Blumont’), a company based in Singapore. $5m of this funding was an ordinary share placement with funds received in March 2013 and the accompanying issue of 227,272,727 ordinary shares at a price of $0.022 per share effected on 11 March 2013. The additional $5m is to be received in the form of convertible notes, which is to be drawn in the second half of 2013. The notes will be convertible at A$0.025 – 0.030 per share and will carry a 12.5% annual interest rate. The agreement with Blumont also provides for a strategic alliance to review other potential projects in Central Asia.

On 25 February 2013, the Company issued the following securities to Alexander Molyneux (or his nominee) as approved at General Meeting held 23 January 2013:

5,750,000 Ordinary Shares 20,000,000 Class C options exercisable at 2 cents and expiring 21 February 2015 25,000,000 Performance Rights – Class A

On 25 February 2013, the Company issued 2,000,000 employee options to Alistair Muir, exercisable at 2 cents and expiring on 21 February 2016.

Other than the above, no other matters or circumstances have arisen since the end of the half-year which significantly affected or may significantly affect the operations of the consolidated entity, the results of those operations or the state of affairs of the consolidated entity in subsequent financial years.

Auditor’s Independence Declaration

The auditor’s independence declaration has been received and is included with this half-year financial report.

Signed in accordance with a resolution of the Board of Directors

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Ranko Matic Director

Dated this 15[th] day of March 2013

Page 6

CELSIUS COAL LIMITED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE HALF-YEAR ENDED 31 DECEMBER 2012

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Revenue Other income Share of net profits of associate Employee benefits expense Director fees Legal and other professional fees Reversal of prior period impairments Share based payments Other expenses (Loss)/profit before income tax Income tax expense (Loss)/profit for the period Other comprehensive income Items that may be reclassified subsequently to operating result Foreign currency translation Total comprehensive (loss)/income for the period Net (loss)/profit attributable to: Members of parent entity Non-controlling interest Total comprehensive (loss)/income attributable to: Members of the parent entity Non-controlling interest Earnings per share: Basic earnings per share Diluted earnings per share	Consolidated 31 December 2012 $ 31 December 2011 $ - 119,643 43,959 - 126,362 285,568 (369,669) - (149,583) (63,000) (294,462) (118,777) - 508,615 (283,000) - (757,357) (88,478)
	(1,683,750) 643,571 (2,810) -
	(1,686,560) 643,571 57,374 -
	(1,629,186) 643,571
	(1,519,899) 643,571 (166,661) -
	(1,686,560) 643,571
	(1,462,525) 643,571 (166,661) -
	(1,629,186) 643,571
	Cents Cents (0.13) 0.07 (0.13) 0.06

The accompanying notes form part of this interim financial report.

Page 7

CELSIUS COAL LIMITED CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2012

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Note ASSETS Current Assets Cash and cash equivalents Trade and other receivables Inventories Other assets Total Current Assets Non-Current Assets Other non-current assets Property, plant and equipment Exploration and evaluation expenditure Investment accounted for using the equity method Total Non-Current Assets Total Assets LIABILITIES Current Liabilities Trade and other payables Total Current Liabilities Non-Current Liabilities Provisions Total Current Liabilities Total Liabilities Net Assets EQUITY Contributed equity 3 Reserves Retained earnings Parent entity interest Non-controlling interest Total Equity	Consolidated 31 December 2012 $ 30 June 2012 $ 1,382,950 2,494,580 237,104 86,877 72,963 - 75,166 42,813
	1,768,183 2,624,270
	2,957 2,519,907 622,337 75,734 18,231,925 2,435,632 - 193,218
	18,857,219 **5,224,491 **
	20,625,402 **7,848,761 **
	352,015 174,103
	352,015 174,103
	63,806 -
	63,806 -
	415,821 174,103
	20,209,581 7,674,658
	19,060,776 5,336,646 367,194 26,820 791,293 2,311,192
	20,219,263 7,674,658 (9,682) -
	20,209,581 7,674,658

The accompanying notes form part of this interim financial report.

Page 8

CELSIUS COAL LIMITED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE HALF YEAR ENDED 31 DECEMBER 2012

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Consolidated Balance at 1 July 2011 Profit for the period Other comprehensive income Total comprehensive income for the period Balance at 31 December 2011 Balance at 1 July 2012 Loss for the period Other comprehensive income Total comprehensive income for the period Issue of share capital Capital raising costs Option reserve Recognition of non- controlling interest on acquisition of subsidiary Balance at 31 December 2012	Contributed Equity $ Retained Earnings/ Accumulated Losses $ Foreign Currency Translation Reserve $ Equity Based Payments Reserve $ Non- Controlling Interest $ Total $ 3,948,683 1,668,795 - 40,076 - 5,657,554
	- 643,571 - - - 643,571 - - - - - -
	- 643,571 - - - 643,571
	3,948,683 2,312,366 - 40,076 - 6,301,125
	5,336,646 2,311,192 (13,256) 40,076 - 7,674,658 - (1,519,899) - - (166,661) (1,686,560) - - 57,374 - - 57,374
	- (1,519,899) 57,374 - (166,661) (1,629,186) 14,300,000 - - - - 14,300,000 (575,870) - - - - (575,870) - - - 283,000 - 283,000 - - - - 156,979 156,979
	19,060,776 791,293 44,118 323,076 (9,682) **20,209,581 **

The accompanying notes form part of this interim financial report.

Page 9

CELSIUS COAL LIMITED CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE HALF YEAR ENDED 31 DECEMBER 2012

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CASH FLOWS FROM OPERATING ACTIVITIES Payments to suppliers and employees Payments for exploration and evaluation Interest received Receipts from customers Net cash outflow from operating activities CASH FLOWS FROM INVESTING ACTIVITIES Net proceeds from associates Payments for property, plant and equipment Loans to other entities Net cash (outflow)/inflow from investing activities CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from share issue Payment for capital raising Net cash inflow from financing activities Net (decrease) in cash held Cash at the beginning of the financial period Cash at the end of the financial period	Consolidated 31 December 2012 $ 31 December 2011 $ (1,569,477) (277,811) (3,258,508) (132,366) 33,948 85,273 20,992 -
	(4,773,045) (324,904)
	319,580 1,594,229 (382,295) - - (1,365,721)
	(62,715) 228,508
	4,000,000 - (275,870) -
	3,724,130 -
	(1,111,630) (96,396) 2,494,580 4,682,565
	1,382,950 4,586,169

The accompanying notes form part of this interim financial report.

Page 10

CELSIUS COAL LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE HALF YEAR ENDED 31 DECEMBER 2012

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1. BASIS OF PREPARATION

Basis of Preparation

These general purpose financial statements for the interim half-year reporting period ended 31 December 2012 have been prepared in accordance with requirements of the Corporations Act 2001 and Australian Accounting Standards including AASB 134: Interim Financial Reporting. Compliance with Australian Accounting Standards ensures that the financial statements and notes also comply with International Financial Reporting Standards.

This interim financial report is intended to provide users with an update on the latest annual financial report of the company. As such, it does not contain information that represents relatively insignificant changes occurring during the half-year within the consolidated entity. It is therefore recommended that this financial report be read in conjunction with the annual financial report of the company for the year ended 30 June 2012, together with any public announcements made by Celsius Coal Limited during the half-year in accordance with continuous disclosure requirements arising under the Corporations Act 2001.

A summary of the material accounting policies adopted by the consolidated entity in the preparation of the financial report can be found in the annual financial report for the year ended 30 June 2012. The accounting policies have been consistently applied, unless otherwise stated.

New and revised Accounting Standards

The consolidated entity has adopted all of the new and revised Accounting Standards and Interpretations issued by the Australian Accounting Standards Board that are mandatory for the current reporting period. The adoption of these new and revised Accounting Standards and Interpretations has not resulted in a significant or material change to the consolidated entity’s accounting policies.

Any new, revised or amending Accounting Standards or Interpretations that are not yet mandatory have not been early adopted by the consolidated entity.

Reporting Basis and Conventions

The financial report has been prepared on an accrual basis and is based on historical costs, modified, where applicable, by the measurement at fair value of selected non-current assets, financial assets and financial liabilities.

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CELSIUS COAL LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE HALF YEAR ENDED 31 DECEMBER 2012

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2. OPERATING SEGMENTS

Identification of Reportable Segment

The consolidated entity operates within two reportable business segments, being mineral exploration and extraction operations in Australia and the Kyrgyz Republic.

Half Year Ended 31 December 2012 Sales to external customers Other revenue/income Total segment revenue Segment result before income tax Loss before income tax As At 31 December 2012 Segment assets Total assets Segment liabilities Total liabilities Half Year Ended 31 December 2011 Other revenue/income Total segment revenue Segment result before income tax Profit before income tax As At 31 December 2011 Segment assets Total assets Segment liabilities Total liabilities	Australia $ Kyrgyz Republic $ - 20,992 142,274 7,055	Consolidated $ 20,992 149,329
	142,274 28,047	170,321
	(1,005,977) (677,773)	(1,683,750)
	1,344,889 19,280,513	(1,683,750)
		20,625,402
	265,478 150,343	20,625,402
		415,821
	Australia $ Kyrgyz Republic $ 119,643 -	415,821
		Consolidated $ 119,643
	119,643 -	119,643
	643,571 -	643,571
	6,434,864 -	643,571
		6,434,864
	133,739 -	6,434,864
		133,739
		133,739

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CELSIUS COAL LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE HALF YEAR ENDED 31 DECEMBER 2012

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3. CONTRIBUTED EQUITY

The changes to contributed equity were as follows:

At beginning of reporting period Shares issued during the period: - 13/9/12 Placement - 19/10/12 Placement - 24/10/12 Kokkia Transaction - 31/12/12 Kokkia Transaction Capital raising costs At reporting date	Number of Shares $ 1,031,953,670 5,336,646 95,000,000 1,900,000 105,000,000 2,100,000 500,000,000 10,000,000 15,000,000 300,000 (575,870)
	1,746,953,670 19,060,776

4. ACQUISITION OF KOKKIA COAL LIMITED

On 25 October 2012, the Company completed the acquisition of 80% interest in Kokkia Coal Limited, a company incorporated and domiciled in Hong Kong, which in turn holds a 100% interest in three prospective coal tenements located in the Uzgen Coal basin in Kyrgyzstan (being TuyukKargasha, Kokkia and Min-Teke). The interest is held via Kokkia’s 100% ownership of two Kyrgyzstan entities, Panj-Sher Ank Ltd and Baidamar Ltd, which together hold the tenements.

This acquisition is not a business combination, but rather an acquisition of mining tenements.

The purchase consideration was as follows:

he purchase consideration was as follows:
500,000,000 fully paid ordinary shares at $0.02 Assumption of Kokkia’s liability to pay for the acquisition of Baidamar Total purchase consideration	$ 10,000,000 2,519,907
	12,519,907

In addition, 900,000,000 Performance Shares were issued by the Company to the vendors and these Performance Shares are conditional on certain milestones being achieved.

5. COMMITMENTS

As part of the acquisition of Kokkia Coal Limited, the Company is required to, subject to certain provisions, solely fund a 30,000 metre drilling program on the project or spend a minimum of $15 million on the project (with a minimum of $5 million spent within two years following the commencement of the project).

6. CONTINGENT LIABILITIES

Since the last annual report date there has been no material change to any contingent liabilities.

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CELSIUS COAL LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE HALF YEAR ENDED 31 DECEMBER 2012

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7. EVENTS SUBSEQUENT TO REPORTING DATE

On 7 February 2013, the Company announced to the market that it had secured commitments for $10m in funding from the Blumont Group Limited (‘Blumont’), a company based in Singapore. $5m of this funding was an ordinary share placement with funds received in March 2013 and the accompanying issue of 227,272,727 ordinary shares at a price of $0.022 per share effected on 11 March 2013. The additional $5m is to be received in the form of convertible notes, which is to be drawn in the second half of 2013. The notes will be convertible at A$0.025 – 0.030 per share and will carry a 12.5% annual interest rate. The agreement with Blumont also provides for a strategic alliance to review other potential projects in Central Asia.

On 25 February 2013, the Company issued the following securities to Alexander Molyneux (or his nominee) as approved at General Meeting held 23 January 2013:

5,750,000 Ordinary Shares 20,000,000 Class C options exercisable at 2 cents and expiring 21 February 2015 25,000,000 Performance Rights – Class A

On 25 February 2013, the Company issued 2,000,000 employee options to Alistair Muir, exercisable at 2 cents and expiring on 21 February 2016.

Other than the above, no other matters or circumstances have arisen since the end of the half-year which significantly affected or may significantly affect the operations of the consolidated entity, the results of those operations or the state of affairs of the consolidated entity in subsequent financial years.

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CELSIUS COAL LIMITED DIRECTORS’ DECLARATION

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The directors of the Company declare that:

1. The financial statements and notes, as set out in this half-year financial report, are in accordance with the Corporations Act 2001, including:

2. a. complying with Accounting Standard AASB 134: Interim Financial Reporting; and

3. b. giving a true and fair view of the consolidated entity’s financial position as at 31 December 2012 and of its performance for the half-year ended on that date.

4. In the director’s opinion there are reasonable grounds to believe that the company will be able to pay its debts as and when they become due and payable.

The declaration is made in accordance with a resolution of the Board of Directors.

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Ranko Matic Director Dated this 15[th] day of March 2013

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RSM Bird Cameron Partners

8 St Georges Terrace Perth WA 6000 GPO Box R1253 Perth WA 6844 T +61 8 9261 9100 F +61 8 9261 9101 www.rsmi.com.au

INDEPENDENT AUDITOR’S REVIEW REPORT TO THE MEMBERS OF CELSIUS COAL LIMITED

We have reviewed the accompanying half-year financial report of Celsius Coal Limited which comprises the statement of financial position as at 31 December 2012, and the statement of comprehensive income, statement of changes in equity and statement of cash flows for the half-year ended on that date, notes comprising a summary of significant accounting policies and other explanatory information, and the directors’ declaration of the consolidated entity comprising the company and the entities it controlled at the half-year end or from time to time during the half-year.

Directors’ Responsibility for the Half-Year Financial Report

The directors of the company are responsible for the preparation of the half-year financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the directors determine is necessary to enable the preparation of the half-year financial report that is free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express a conclusion on the half-year financial report based on our review. We conducted our review in accordance with Auditing Standard on Review Engagements ASRE 2410 Review of a Financial Report Performed by the Independent Auditor of the Entity , in order to state whether, on the basis of the procedures described, we have become aware of any matter that makes us believe that the half-year financial report is not in accordance with the Corporations Act 2001 including: giving a true and fair view of the consolidated entity’s financial position as at 31 December 2012 and its performance for the half-year ended on that date; and complying with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001 . As the auditor of Celsius Coal Limited, ASRE 2410 requires that we comply with the ethical requirements relevant to the audit of the annual financial report.

A review of a half-year financial report consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Australian Auditing Standards and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

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Liability limited by a Major Offices in: RSM Bird Cameron Partners is a member of the RSM network. Each member scheme approved Perth, Sydney, Melbourne, of the RSM network is an independent accounting and advisory firm which under Professional Adelaide and Canberra practises in its own right. The RSM network is not itself a separate legal entity Standards Legislation ABN 36 965 185 036 in any jurisdiction.

Independence

In conducting our review, we have complied with the independence requirements of the Corporations Act 2001 . We confirm that the independence declaration required by the Corporations Act 2001 , which has been given to the directors of Celsius Coal Limited, would be in the same terms if given to the directors as at the time of this auditor's review report .

Conclusion

Based on our review, which is not an audit, we have not become aware of any matter that makes us believe that the half-year financial report of Celsius Coal Limited is not in accordance with the Corporations Act 2001 , including:

• (a) giving a true and fair view of the consolidated entity’s financial position as at 31 December 2012 and of its performance for the half-year ended on that date; and

• (b) complying with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001 .

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RSM BIRD CAMERON PARTNERS

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Perth, WA Dated: 15 March 2013

TUTU PHONG Partner

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RSM Bird Cameron Partners 8 St Georges Terrace Perth WA 6000 GPO Box R1253 Perth WA 6844 T +61 8 9261 9100 F +61 8 9261 9101 www.rsmi.com.au

AUDITOR’S INDEPENDENCE DECLARATION

As lead auditor for the review of the financial report of Celsius Coal Limited for the half-year ended 31 December 2012, I declare that, to the best of my knowledge and belief, there have been no contraventions of:

• (i) the auditor independence requirements of the Corporations Act 2001 in relation to the review; and

• (ii) any applicable code of professional conduct in relation to the review.

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RSM BIRD CAMERON PARTNERS

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Perth, WA Dated: 15 March 2013

TUTU PHONG Partner

Liability limited by a Major Offices in: RSM Bird Cameron Partners is a member of the RSM network. Each member scheme approved Perth, Sydney, Melbourne, of the RSM network is an independent accounting and advisory firm which under Professional Adelaide and Canberra practises in its own right. The RSM network is not itself a separate legal entity Standards Legislation ABN 36 965 185 036 in any jurisdiction.

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