Celsius Resources Limited — Interim / Quarterly Report 2012

Jan 30, 2013

QUARTERLY ACTIVITIES REPORT

DECEMBER 2012

HIGHLIGHTS

• 2012 exploration programme successfully completed including receipt of most analytical results.

• Assays clearly confirm coal seams at Kargasha have very good coking properties. From the 49 coal samples analysed for FSI all but 3 show levels greater than 4.5 (typically assessed as the threshold for coking coal). Most samples show FSI in the range of 6.5-8.5 (indicating high quality coking coal).

• Seams at Min Teke have coals with a mix of premium thermal coal and coking coal characteristics.

• Celsius is currently preparing its ‘maiden’ JORC resource, which is expected to be finalised by the end of the first quarter of 2013. The Company maintains its Exploration Target of 501 to 700 million tonnes of coal[1] for the Uzgen Basin Coking Coal Project.

• Mining commenced at Sary Mogol in accordance with the terms of the Company’s Development / Mining License.

• Alexander Molyneux appointed as Executive Chairman.

During the Quarter the Company completed its confirmatory drill program to test the Company’s exploration prospects at its Uzgen Basin Coking Coal Project located in Central Kyrgyzstan. 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 as Table 1 & Table 2 (these intercepts have been confirmed by laboratory analysis).

1 Note, the potential quantity is conceptual in nature, there has been insufficient exploration to define a Mineral Resource and it is uncertain if further exploration will result in the determination of a Mineral Resource.

Coal Quality Analysis Results

Results of raw coal sample testing from Kargasha are shown in Table 3 below. 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).

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.

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.

Samples for float/sink beneficiation testing from drill holes DD12TK002, DD12TK004, DD12TK005, DD12TK006 and DD12TK007 have been received and are currently being assessed and will be reported in the near future. Final analyses required for drill holes DD12TK002, DD12TK004, DD12TK005, DD12TK006 and DD12TK007 have been specified and forwarded to SGS Novokuznetsk laboratory.

Interim analyses for drill holes DD12MT001, DD12MT002 and DD12MT003 have been received 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 are tabled in Table 4 below and 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.

The drill holes DD12TK002, DD12TK004, DD12TK005, DD12TK006, DD12TK007 coking test results are consistent with those obtained for drill holes DD12TK001 (reported 9[th] October 2012) and DD12TK003 (reported 12 December 2012) and also show a continuing trend of low to moderate phosphorous and total sulphur content. 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.

Kargasha (Uzgen Basin Coking Coal Project) – Resource Estimation

Celsius is continuing to compile and interpret Soviet era diamond core drill hole, adit and trench data for Kargasha and Kokkia and it is progressively being entered into Vulcan software (after rigorous examination) for verification and analysis. The data will be used to create 3D digital coal seam thickness and coal quality models, which will form the basis of coal resource estimation. The Company is on track to deliver its maiden JORC coal resource in the first quarter of 2013.

Celsius has been able to secure quality 1:25,000 scale digital topographic data which has now been validated and is ready for use in resource estimates.

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Mining & Product Studies

Brisbane based mining consultants, Minserve have been retained for on-going coal assaying and mining advice and to potentially undertake a scoping study in 2013.

ALS (ACIRL) has been retained to review and compare historical Soviet era semi-industrial and industrial scale coking tests with current test results.

The commencement of these advanced studies at this initial stage means that Celsius will be well placed to fast track its quality coal projects into production as JORC compliant resources are defined and confidence increased in the quality of coal present (as well as amount of coking quality coal).

Mining – Sary Mogol (Alai Range Project) & Min Teke (Uzgen Basin Coking Coal Project)

During the quarter open pit mining commenced at Sary Mogol mining lease targeting the excavation of at least 5,000 tonnes of high grade thermal coal for sale to the domestic market to comply with the conditions of the Company’s Development / Mining License. To date approximately 7,300 tonnes of coal has been mined at Sary Mogol. The Company anticipates generating a small cash flow from these activities.

As previously reported mining at Min Teke was completed during the September Quarter and mine planning / scheduling will be developed for this year’s mining following analysis of the results of the 2012 drill programme (reported above) and estimation of the coal resource at Min Teke.

Infrastructure

During the quarter 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.

The current mapped route comes within 10 kilometers of Celsius’ Uzgen Basin Coking Coal Project and will connect to the existing Chinese railway network at Kashgar (Kashi) in Xinjiang.

China has an explicit policy to bring investment to Xinjiang with an estimated RMB 2,100bn (USD 340m) of policy-led investments planned between now and 2020. This investment includes the establishment of a Special Economic Zone at Kashgar (Kashi) to become a manufacturing centre for export to Central Asia and Russia. The 2015 Xinjiang development goals include: 60% urbanization; additional 170,000 kilometres of roads; 8,200 kilometres of railway expansion; and 22 new airports.

Xinjiang is forecast to import 30 million tonnes of coking coal from other countries and provinces of China by 2015 and will be the important ‘beach head’ market for Celsius’ plans to export its coking coal to China. Celsius’ Uzgen Basin coking coal projects is approximately 250km from Kashgar (Kashi) via the proposed Trans-Asia Railway (Figure 2).

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Celsius has undertaken a review of transport options to facilitate coal export prior to completion of the TransAsia 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.

Corporate

During the Quarter the Company announced the appointment of Mr Alexander Molyneux as Executive Chairman. The board considers the appointment to be material to the development of the company. Celsius will benefit from the experience and the track record of Mr Molyneux as the company looks to progress its existing coking and thermal coal projects in Kyrgyz Republic towards commercialisation.

Mr. Molyneux, 37, recently left SouthGobi Resources Limited (TSX: SGQ, HKEX: 1878) where he was President, Chief Executive Officer and a Director from 2009 to 2012, following the acquisition of control by Rio Tinto. Under his leadership, this company became the largest foreign operator in Mongolia's coal sector. The company also completed a sovereign wealth fund financing and main board listings on the Toronto Stock Exchange and then subsequently Hong Kong Stock Exchange. He has also served as a Non-Executive Director of Ivanhoe Energy Inc. since mid-2010, and serves as Chairman of Azarga Resources Limited, which acquired the largest known uranium deposit in Kyrgyz Republic.

Prior to joining SouthGobi Mr. Molyneux was Managing Director, Head of Metals & Mining Investment Banking, Asia Pacific, with Citigroup. In his position as a specialist resources investment banker he spent approximately 10 years providing advice and investment banking services to mining and industrial corporations. Mr. Molyneux has advised on public offerings, mergers and acquisitions, bond and debt offerings totaling several billion dollars. He joined Citigroup from UBS in early-2007 where he had held a similar position. Mr. Molyneux holds a Bachelor degree in Economics from Monash University in Australia and is a member of the Canadian Institute of Corporate Directors.

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

==> picture [520 x 663] intentionally omitted <==

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Table 1 – Coal Intersections in 2012 Kargasha Drilling

Drillhole Name	Soviet Hole Twin No.	Completed Depth	Intervals of Interest
DD12TK001	40	437m	3.52m interval including 2.04m of coal at 351.08m. 1.94m coal interval 361.56m.
DD12TK002	25	639m	1.10m interval including 0.82m of coal at 502.65m. 0.77m coal interval at 523.55m 1.29m interval including 1.17m of coal at 540.17m. 0.64m interval including 0.52m of coal at 548.08m.
DD12TK003	56 (250m E)	661m	1.06m coal interval at 552.64m. 0.68m coal interval at 558.42m. 1.15m interval including 1.06m of coal at 578.85m. 1.94m interval including 1.39m of coal at 602.2m. 0.56m coal interval at 607.2m.
DD12TK004	48	556.5m	0.94m interval including 0.89m of coal at 479.69m
DD12TK005	31	332m	1.71m interval including 1.00m of coal at 230.49m. 1.11m interval including 0.88m of coal at 260.20m. 1.59m interval including 0.81m of coal at 263.23m. 1.07m interval including 0.98m of coal at 273.08m. 1.40m interval including 0.98m of coal at 294.94m. 3.82m interval including 1.58m of coal at 298.09m. 1.09m interval including 0.69m of coal at 323.41m.
DD12TK006	30	274m	0.53m coal interval at 146.87m. 0.60m coal interval at 148.93m. 0.77m interval including 0.68m of coal at 174.23m. 1.37m interval including 0.97m of coal at 209.75m. 0.51m coal interval at 215.38m.
DD12TK007	Exploration	331m	1.20m interval including 1.11m of coal at 207.54m. 0.83m interval including 0.81m of coal at 245.85m. 0.61m interval including 0.59m of coal at 260.44m.
Sub-Total		3230.5m

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Table 2 – Coal Intersections in 2012 Min Teke Drilling

Drillhole Name	Soviet Hole Twin No.	Completed Depth	Intervals of Interest
DD12MT001	Exploration	200m	0.59m coal interval at 16.60m 0.31m coal interval at 20.48m 0.59m coal interval at 23.22m 0.80m coal interval at 62.60m
DD12MT002	Exploration	180.4m	0.59m coal interval at 28.31m 0.57m interval including 0.51m of coal at 39.71m 0.34m coal interval at 58.16m 0.99m interval including 0.64m of coal at 71.19m 1.95m interval including 1.29m of coal at 76.55m 0.39m coal interval at 81.11m 0.65m coal interval at 104.30m 2.98m interval including 2.06m of coal at 112.32m 1.59m interval including 1.31m of coal at 128.73m 0.53m coal interval at 134.59m 0.50m interval including 0.45m of coal at 140.00m
DD12MT003	Exploration	180m	3.17m interval including 2.52m of coal at 9.63m 0.47m coal interval at 13.50m 0.63m coal interval at 17.13m 0.84m interval including 0.69m of coal at 21.80m 2.07m interval including 1.02m of coal at 52.50m 0.87m coal interval at 56.02m 0.31m coal interval at 69.67m 0.46m coal interval at 81.61m 1.61m interval including 1.19m of coal at 92.75m 0.47m coal interval at 110.40m
Sub-Total		360.4m

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Table 3 – Analytical Results from Kargasha

DD12TK001 (Results of +0.5mm - 10mm fraction)

Sam. No.	From	To	Thick	IM	Ashad	VMad	GCVad	Pd	TSd	FSI
	m	m	m	%(ad)	%(ad)	%(ad)	Kcal/Kg(ad)	%(db)	%(db)
3003	352.87	353.36	0.49	1.5	5.7	18.5	7,697	0.001	0.32	0.5
3005	353.47	354.60	1.13	1.4	3.1	28.9	7,982	0.001	0.32	7.5
3008*	361.56	363.40	1.84	1.2	46.2	20.5	4,174	0.011	1.56	1.5

*** Incorrectly sampled with parting included. FSI on washed sample is 7.5.**

DD12TK002

**DD12TK002 **
Sam. No. From To Thick IM Ashad VMad GCVad Pd	TSd FSI
m m m %(ad) %(ad) %(ad) Kcal/Kg(ad) %(db)	%(db)
3050 502.65 503.26 0.61 1.1 11.4 38.9 7390 n/a 3053 523.58 524.32 0.74 1.8 5.7 30.0 7682 n/a 3055 525.67 525.98 0.31 1.3 4.7 36.1 7903 n/a 3057 540.17 540.38 0.21 2.2 5.7 34.2 7784 n/a 3059 540.50 541.46 0.96 1.2 20.4 31.2 6528 n/a 3061 543.54 543.87 0.33 1.3 9.1 34.9 7469 n/a 3063 548.08 548.58 0.50 1.2 27.0 26.9 5750 n/a	0.41 6.0 1.04 7.5 0.72 7.5 0.50 7.5 0.35 8.0 0.88 7.0 0.40 1.0

DD12TK003 (Results of +0.5mm - 10mm fraction)

DD12TK003 (Results of +0.5mm - 10mm fraction)
Sam. No. From To Thick IM Ashad VMad GCVad Pd	TSd FSI
m m m %(ad) %(ad) %(ad) Kcal/Kg(ad) %(db)	%(db)
3011 540.50 540.78 0.28 1.4 7.1 38.1 7627 0.002 3013 552.64 553.70 1.06 1.2 8.5 37.5 7548 0.006 3016 556.44 556.90 0.46 1.4 10.9 35.4 7268 n/a 3019 558.42 559.10 0.68 1.3 10.7 36.4 7340 n/a 3021 566.38 566.56 0.18 1.1 23.9 31.1 6229 0.012 3022 571.77 572.04 0.27 1.2 15.1 33.9 6782 0.014 3023 577.49 577.84 0.35 1.1 12.6 35.6 7204 0.053 3025 578.85 579.43 0.58 0.9 23.0 42.2 5677 n/a 3027 579.52 580.00 0.48 0.8 20.2 33.5 6451 n/a 3029 588.08 588.21 0.13 0.9 37.0 29.2 5213 n/a 3030 588.21 588.68 0.47 0.9 19.3 35.9 6483 n/a 3033 602.20 602.67 0.47 1.0 27.4 30.1 5903 n/a 3035 602.78 603.00 0.22 1.0 27.6 27.2 5868 n/a 3037 603.44 604.14 0.70 1.0 32.4 27.7 5058 0.031 3040 606.64 607.20 0.56 1.5 15.3 32.2 6947 0.012 3042 608.57 608.94 0.37 1.2 21.1 30.7 6446 0.017 3046 631.77 632.00 0.23 1.0 12.2 32.9 7280 n/a	0.83 7.0 0.46 7.0 0.55 6.5 0.59 7.0 0.74 n/a 0.91 6.5 0.68 7.5 0.75 n/a 0.60 n/a 0.51 n/a 0.60 8.5 1.03 n/a 0.65 n/a 0.48 n/a 0.76 7.0 0.61 n/a 0.60 8.0

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**DD12TK004 **	TSd FSI
Sam. No. From To Thick IM Ashad VMad GCVad Pd
m m m %(ad) %(ad) %(ad) Kcal/Kg(ad) %(db)	%(db)
3066 479.69 480.00 0.31 1.7 5.4 35.2 7855 n/a 3068 480.05 480.63 0.58 1.5 5.1 37.6 7927 n/a 3070 488.53 488.83 0.30 1.4 8.9 34.3 7572 n/a 3071 443.38 443.77 0.39 1.5 8.1 36.9 7552 n/a	0.53 7.0 0.51 8.0 0.70 7.0 0.65 8.0

DD12TK005	TSd FSI
Sam. No. From To Thick IM Ashad VMad GCVad Pd
m m m %(ad) %(ad) %(ad) Kcal/Kg(ad) %(db)	%(db)
3073 230.49 231.16 0.67 1.4 26.0 30.7 5976 n/a 3075 231.85 232.20 0.35 1.5 12.1 34.8 7246 n/a 3076 236.69 236.89 0.20 1.3 4.5 40.4 7987 0.002 3080 260.64 260.72 0.08 1.1 38.6 26.0 5001 n/a 3082 260.81 261.31 0.50 1.9 5.5 37.2 7750 0.005 3084 263.23 263.43 0.20 1.1 22.5 32.0 6751 n/a 3085 263.43 263.48 0.05 0.6 22.5 41.6 6594 n/a 3086 263.48 263.63 0.15 1.7 6.2 34.4 7725 n/a 3088 263.73 264.00 0.27 1.3 30.7 28.3 5519 n/a 3091 273.32 273.81 0.49 1.3 10.3 38.0 7383 n/a 3093 273.90 274.15 0.25 1.5 6.3 36.5 7807 n/a 3096 294.94 295.07 0.13 1.2 16.1 32.8 6845 n/a 3098 295.34 295.73 0.39 1.5 12.3 32.4 7212 n/a 3100 295.89 296.34 0.45 1.3 11.2 34.9 7424 n/a 3103 298.09 299.00 0.91 1.2 10.0 34.0 7349 n/a 3106 301.20 301.32 0.12 1.1 25.6 27.0 6062 n/a 3108 301.36 301.91 0.55 1.1 12.3 40.0 7017 n/a DD12TK006	0.49 n/a 0.63 6.5 0.66 6.5 1.90 n/a 0.96 6.5 0.64 n/a 0.41 n/a 0.68 8.0 0.83 n/a 0.62 8.0 0.74 8.0 3.00 8.0 0.53 7.5 0.57 7.5 0.70 7.5 1.10 n/a 0.51 8.0 TSd FSI
Sam. No. From To Thick IM Ashad VMad GCVad Pd
m m m %(ad) %(ad) %(ad) Kcal/Kg(ad) %(db)	%(db)
3111 146.87 147.25 0.38 1.5 6.4 39.6 7753 n/a 3112 147.28 147.40 0.12 1.1 20.3 34.7 6661 n/a 3115 149.03 149.53 0.50 1.4 11.0 36.0 7255 n/a 3118 174.23 174.55 0.32 1.6 14.2 33.3 7089 n/a 3120 174.64 175.00 0.36 1.7 8.1 36.8 7646 n/a 3122 176.10 176.49 0.39 1.5 14.5 31.8 7036 n/a 3123 200.83 201.05 0.22 1.5 9.8 33.8 7458 n/a 3125 209.75 210.49 0.74 1.3 7.3 38.7 7704 n/a 3127 212.56 213.00 0.44 1.5 10.6 34.0 7373 n/a 3129 215.38 215.89 0.51 1.4 4.4 37.7 7983 n/a 3131 222.18 222.39 0.21 1.7 5.2 34.1 7820 n/a 3132 240.12 240.45 0.33 1.1 21.2 29.5 6401 n/a	0.51 5.5 0.42 n/a 0.86 7.5 0.80 7.5 0.85 6.5 0.81 7.0 0.74 8.0 0.55 8.0 0.80 8.0 0.75 8.0 0.77 8.0 0.52 n/a

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**DD12TK007 **	**DD12TK007 **
Sam. No.	From	To	Thick	IM	Ashad	VMad	GCVad	Pd	TSd	FSI
	m	m	m	%(ad)	%(ad)	%(ad)	Kcal/Kg(ad)	%(db)	%(db)
3134	207.54	208.38	0.84	1.5	11.0	38.0	7308	n/a	0.46	6.5
3135	208.38	208.47	0.09	1.8	34.3	26.8	5220	n/a	0.40	n/a
3136	208.47	208.74	0.27	1.4	9.5	37.0	7558	n/a	0.45	7.0
3140	210.27	210.54	0.27	1.0	19.6	35.4	6652	n/a	0.52	7.0
3142	244.15	244.55	0.40	1.4	29.2	31.9	5594	n/a	0.87	n/a
3144	245.85	246.68	0.83	1.4	8.8	37.8	7520	n/a	0.73	7.5
3147	248.16	248.77	0.61	1.3	27.6	29.5	5897	n/a	0.73	n/a
3150	260.44	261.05	0.61	1.3	25.3	32.0	6082	n/a	0.52	n/a
3153	296.17	296.51	0.34	1.3	8.6	33.7	7629	n/a	0.58	8.0

Table 4 – Analytical Results from Min-Teke

**DD12MT001 **	**DD12MT001 **
Sam. No.	From	To	Thick	IM	Ashad	VMad	GCVad	TSd	FSI
	m	m	m	%(ad)	%(ad)	%(ad)	Kcal/Kg(ad)	%(db)
3451	16.60	17.19	0.59	1.9	34.1	24.9	4887	0.58	n/a
3452	23.22	23.81	0.59	1.9	31.3	26.9	4869	0.53	n/a
3453	62.60	63.40	0.80	1.5	20.5	28.0	6219	0.79	n/a

**DD12MT002 **	**DD12MT002 **
Sam. No.	From	To	Thick	IM	Ashad	VMad	GCVad	TSd	FSI
	m	m	m	%(ad)	%(ad)	%(ad)	Kcal/Kg(ad)	%(db)
3455	39.71	40.28	0.57	1.6	29.6	26.1	5271	0.62	n/a
3456	58.16	58.50	0.34	2.2	26.8	26.2	5163	0.49	n/a
3457	71.19	71.56	0.37	0.9	43.8	21.0	4313	0.47	n/a
3458	76.55	77.11	0.56	1.5	20.6	32.8	6472	0.71	n/a
3459	77.77	78.45	0.68	1.7	32.6	28.0	5217	0.59	n/a
3460	81.11	81.50	0.39	1.9	24.1	26.9	6030	0.92	n/a
3462	104.30	104.95	0.65	2.2	25.3	30.5	5866	0.77	n/a
3466	113.70	114.05	0.35	1.4	8.3	33.5	7545	1.16	8.0
3468	114.36	114.66	0.30	1.4	13.8	33.0	7102	0.79	8.0
3469	114.88	115.30	0.42	1.5	7.2	33.1	7643	0.87	8.0
3470	128.73	129.43	0.70	1.2	32.3	23.2	5400	0.57	n/a
3471	129.71	130.32	0.61	1.4	5.2	35.7	8001	0.66	8.5
3472	134.59	135.12	0.53	1.3	8.5	31.4	7532	0.59	n/a

DD12MT003	DD12MT003
Sam. No.	From	To	Thick	IM	Ashad	VMad	GCVad	TSd	FSI
	m	m	m	%(ad)	%(ad)	%(ad)	Kcal/Kg(ad)	%(db)
3474	9.63	9.70	0.07	2.0	44.6	20.7	3773	0.44	n/a

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3476	9.80	10.73	0.93	2.5	18.2	27.8	6215	0.63	1.0
3478	10.91	11.20	0.29	1.3	52.6	20.4	3299	0.63	n/a
3480	11.30	11.80	0.50	1.8	15.2	32.0	6818	0.69	5.5
3482	12.00	12.54	0.54	1.5	33.4	26.0	5269	0.54	n/a
3484	12.70	12.80	0.10	1.4	29.7	25.6	5562	0.44	n/a
3486	13.50	13.97	0.47	1.3	21.2	33.0	6159	0.65	n/a
3488	17.13	17.87	0.74	1.4	26.7	27.9	5824	0.68	n/a
3490	21.80	22.20	0.40	1.6	19.6	30.7	6364	0.79	1.0
3492	22.35	22.64	0.29	1.2	30.5	27.2	5584	0.79	n/a
3493	44.61	45.30	0.65	2.0	15.6	31.1	6809	0.60	6.0
3495	45.53	45.69	0.16	1.9	22.2	25.8	6328	0.69	n/a
3497	45.79	46.50	0.71	1.8	22.9	31.7	6028	0.83	n/a
3498	54.00	54.57	0.57	1.8	7.5	34.5	7614	0.89	7.0
3499	56.02	56.89	0.87	1.9	26.0	27.3	5874	0.63	n/a
3500	69.67	69.98	0.31	1.8	11.3	34.1	7284	0.83	6.5
3401	81.61	82.07	0.46	1.5	22.3	28.2	6203	0.75	n/a
3402	92.10	92.75	0.65	1.4	7.7	33.4	7594	0.99	7.0
3403	93.00	93.20	0.20	1.5	9.7	33.9	7422	1.29	7.0
3405	93.37	93.71	0.34	1.5	13.3	32.0	7144	0.86	7.0
3406	109.70	110.10	0.40	1.8	19.5	27.6	6467	0.59	n/a
3407	110.40	110.82	0.42	1.3	7.2	34.6	7660	0.60	7.0

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Figure 2 – Location of Celsius’ projects and export routes including the proposed Trans-Asia Railway

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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

During the quarter 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.

ABOUT CELSIUS COAL

Celsius Coal Ltd is focused on developing coking and thermal coal deposits in the Kyrgyz Republic.

Celsius owns 80% of its Uzgen Basin Coking Coal Project (comprising: Kargasha; Kokkia; and Min Teke), which cover an established Soviet-era coking coal resource. It also owns 90% of its Alai Range Projects (comprising: Sary Mogol and Bel Alma).

For more information, please visit www.celsiuscoal.com.au or contact Mr Ranko Matic, Company Secretary on +61 (08) 9226 4500.

Competent Person’s Statement

The information in this report that relates to Exploration Results, Exploration Targets, Mineral Resources or Ore Reserves is based on information compiled by Mr Grant Thomas and Mr Alistair Muir who are both member of the Australasian Institute of Mining and Metallurgy (AusIMM). Mr Thomas is the Managing Director and Mr Muir is the Country Manager of Celsius Coal Limited and both have sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity which they are undertaking to qualify as a Competent Persons as defined in the 2004 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Thomas and Mr Muir both consents to the inclusion in this announcement of the matters based on this information in the form and context in which it appears.

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Exploration Targets

It is common practice for a company to comment on and discuss its exploration in terms of target size and type. The information in this announcement relating to Exploration Targets should not be misunderstood or misconstrued as an estimate of Mineral Resources or Ore Reserves. Hence the terms Resource(s) and Reserve(s) have not been used in this context in this announcement. The potential quantity of coal presented in this announcement as Exploration Targets are conceptual in nature. It should be noted that there has been insufficient exploration to define a Mineral Resource which complies with the JORC code, and it is uncertain if further exploration will result in the determination of a Mineral Resource. Celsius Coal intends to carry out an exploration programme to systematically test the Exploration Targets for each of the Prospects, which are detailed in table 1 below.

Table 1. Exploration Targets for the Kargasha, Tuyuk, Kokkia and Min-Teke Prospects

Prospect	Exploration Target (millions of tonnes ofcoal)	Moisture (%)	Ash (%)	Sulphur (%)	Calorific Value (kcal/kg)
Kargasha	115 – 140	0.9 – 6.0	3.0 – 10.0	0.4 – 0.9	7700 - 8700
Tuyuk	267 – 335
Kokkia	114 – 198	0.7 – 5.0	5.0 – 15.0	0.4 – 0.9	7800 - 8500
Min-Teke	5 – 27	3.0 – 10.0	10.0 – 25.0	0.4 – 0.9	6200 - 7700
Total	501 - 700

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