Celsius Resources Limited — Investor Presentation 2013

Mar 21, 2013

PREMIUM COAL SUPPLY FOR CHINA AND CENTRAL ASIA

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The information contained in this presentation (“Presentation”) has been prepared by Celsius Coal Ltd (“Company” or “Celsius” or “CLA”) and is being communicated for general background informational purposes only. The information contained in this Presentation is subject to updating, completion, revision, verification and further amendment. Neither the Company, nor its shareholders, directors, officers, agents, employees, or advisors give, has given or has authority to give, any representations or warranties (express or implied) as to, or in relation to, the accuracy, reliability or completeness of the information in this Presentation, or any revision thereof, or of any other written or oral information made or to be made available to any interested party or its advisers (all such information being referred to as “Information”) and liability therefore is expressly disclaimed.

Information contained in this Presentation is the property of the Company. It is made available strictly for the purposes referred to above. Neither the communication of this Presentation nor any part of its contents is to be taken as any form of commitment on the part of the Company to proceed with any transaction. This Presentation does not constitute, or form part of, any offer or invitation to sell or issue, or any solicitation of any offer to subscribe for or purchase any securities in the Company, nor shall it, or the fact of its communication, form the basis of, or be relied upon in connection with, or act as any inducement to enter into, any contract or commitment whatsoever with respect to such securities This Presentation is not to be communicated to any other person or used for any other purpose and any other person who receives communication of this Presentation should not rely or act upon it. In furnishing this Presentation, the Company does not undertake or agree to any obligation to provide the attendee with access to any additional information or to update this Presentation or to correct any inaccuracies in, or omissions from, this Presentation that may become apparent either during, or at any time after this Presentation.

The Information in this Presentations which relates to Coal Resources, Exploration Targets and Exploration Results should be read in conjunction with the Competent Persons statements on page 31 including the relevant disclaimers. The use of the terms Coal Resources, Exploration Targets and Exploration Results is consistent with their definitions in the 2004 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’ and references to these terms are made with these definitions in mind.

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Company snapshot

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Ca italization summar p y

Corporate structure

Shareprice(at Mar 12, 2013)	A$0.024/share
Shares outstanding	1,959.3m
Market capitalization	A$47.0m
Cash (at Mar 31, 2013’F)	A$5.3m
Enterprise value	A$41.7m

Share price (LTM – A$/share)

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Australia
Celsius Coal
Ltd.
Hong Kong 100% 80%
Osphur (HK) Kokkia Coal
Ltd. (HK) Ltd.
Kyrgyz Republic
90% 100% 100%
Asia Pacific Pandj-Sher
Baidamar JSC
Resources LLC ANK LLC
100% 100% 100% 100% 100%
Sary
Bel Alma Kargasha Min Teke Kokkia
Mogol
Alai Range licenses Uzgen Basin coking coal licenses
Mining license Exploration license
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Uzgen Basin coking coal licenses

Kargasha

Status: Exploration license Expiry: December 2013 Size: 8,000ha

Kokkia

Status: Exploration license Expiry: December 2013 Size: 1,576ha

Alai Range licenses

Sary Mogol

Status: Mining license Expiry: July 2016 Size: 8ha

Bel Alma

Status: Exploration license Expiry: June 2013 Size: 329ha

Min Teke

Status: Mining license Expiry: September 2019 Size: 187ha

– Licenses containing JORC Resources

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Completion of 2012 exploration and maiden JORC-standard Resource (15 March)

• Completed 5,300 meters of core drilling during 2012 – mainly focused on twining extensive historical Soviet-era data on the Kargasha Prospect

• Lab-based wash testing published mid-February indicating high yield into coking coal products

• Maiden JORC Resource of 255 million tonnes (Inferred) published 15 March

Blumont financing (7 February)

• A$10m financing to fully fund 2013 exploration / development program

• A$5m placement of ordinary shares at A$0.022/share (completed 11 March)

• Additional A$5m in the form of convertible notes that can be drawn by Celsius in the

• second half of 2013

• Convertible notes carry 12.5% interest and convert at A$0.025-0.030/share

Fully financed through aggressive 2013 exploration and study program to complete Q1 2014

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Name and position Background

Alexander Molyneux Executive Chairman

• Previously CEO, SouthGobi Resources (2009-2012) – largest foreign coal producer in Mongolia (US$550M market cap./ US$800M EV). Successfully took SouthGobi from explorer to mine production and sales. SouthGobi dual listed - TSX and HKEX

 Prior to SouthGobi, 10-years metals and mining investment banking, including Managing Director, Head of Metals and Mining Asia Pacific for Citigroup  Directorships: Ivanhoe Energy (2010-); Goldrock Mining (2012-); and Azarga Resources (2012-)

• Grant Thomas  Competent Person for purposes of JORC Code and over 30 years experience as a Managing Director practising geologist/geophysicist  Previously Managing Director of Tianshan Goldfields – Xinjiang, China (ASX/AIM); and Rio Tinto senior management (Australia, China, Brazil and Hamersley Iron)

• More recently a consultant for Dragon Mining Consulting providing Competent Person and valuation services for Chinese coal companies seeking to list on the Hong Kong Stock Exchange

• Directorships: International Resources Group (2009-)

• Bill Oliver  Qualified geologist with over 12 years experience with both majors and juniors

Non-Executive Director

• Previously Exploration Director and then Managing Director of Signature Metals – went from explorer to producer with gold project in Ghana

• Led large scale resource definition projects for Rio Tinto

Ranko Matic

CFO, Company Secretary and Director

• Qualified Chartered Accountant with over 20 years experience in financial and executive management, accounting, audit and corporate advisory

• Currently a Director at Bentleys, a Perth-based accounting and corporate advisory firm

• Directorships: East Energy Resources (2007-); and Core Services Group (2012-)

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Investment themes

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Summary of coal Resources (Uzgen Basin Coking Coal)[1 ]

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Inferred Total
Kargasha 230 230
Kokkia 25 25
Min Teke – –
Total 255 255
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Total targeted tonnages (including exploration targets)[2 ]

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JORC Resources Exploration target Total
Uzgen Basin Coking Coal 255 55 – 110 310 - 365
Alai Range – 20 – 51 20 – 51
Total – 75 – 161 330 – 411
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Notes: 1. Please refer to the Competent Persons Statement on slide 31 relating to these Coal Resources. 2. Please refer to the Competent Persons Statement on slide 31. The information on this slide relating to Exploration Targets should not be misunderstood or misconstrued as an estimate of Mineral Resources or Ore Reserves.

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Indicative coal ualities q

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Calorific Volatile Inherent
Ash [ad] Sulphur [db] Free Swell
Value [daf] Matter [ad] Moisture
(%) (%) Index
Uzgen Basin (Kcal/kg) (%) (%)
Kargasha 7,862 [(1)] 31.6 [(2)] 1.3 [(2)] 12.7 [(2)] 0.64 [(2)] 7-7.5 [(1)]
Kokkia 7,800-8,500 [(3)] 29.5 [(2)] 1.2 [(2)] 9.9 [(2)] 0.65 [(2)] -
Min Teke 6,200-7,700 [(3)] N/A 3-10 [(3)] 10-25 [(3)] 0.4-0.9 [(3)] -
Calorific Volatile Inherent
Ash [ad] Sulphur [d] Free Swell
Value [daf] Matter [ad] Moisture
(%) (%) Index
Alai Range (Kcal/kg) (%) (%)
Sary Mogol 4,300-6,400 [(4)] 27-34 [(4)] 5-9 [(4)] 8-32 [(4)] 0.4-0.6 [(4)] -
Bel Alma 5,200-7,300 [(4)] 28-31 43 [(3)][(4)] 2-4 [(4)] 2-23 [(4)] 0.4-0.9 [(4)] -
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Notes: Basis of reporting: 1) Statistical analysis of Celsius 2012 drilling 2) Extract from the JORC resource estimation computer modeling. 3) Data is sourced from Soviet era historical data. 4) Quality data for Alai Range is from surface samples 2011 – high quality thermal coal, although no coking tests to date

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Chinese coking coal classification system

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Fat (FM) Gas fat (QF)
85
Coking (JM) 1/3 coking Gas
65
Kargasha
60
Anthracite
50
Lean Kokkia
1/2 caking
35
30
20
Weakly caking Long flame
Meager lean
5 Meager Non-caking
0 10 20 28 37 50
Volatile matter (%)
Caking Index (G)
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China’s benchmark (Shanxi Liulin – 2012 China pricing US$190-240/t)

Australian benchmark premium hard coking coal (Goonyella – 2012 seaborne pricing US$165-225/t)

Standard coking coal (Canadian coals – 2012 seaborne pricing US$145-200/t)

Semi-soft coking coal (Xinjiang Fukang – 2012 China pricing US$150-200/t)

Soviet era coke tests classified much of Kargasha and Kokkia as coking coal – including the best categories (Fat and Coking)

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Xinjiang Province China, basic facts

• Population: 22m

• GDP/capita: US$4,600 (1/3-1/2 coastal levels)

Xinjiang development and infrastructure

• Xinjiang has been highlighted as a special case for policy-led growth initiatives

• Total of RMB 2.1tn (US$333bn) to be spent to 2020 for infrastructure

• Kashgar (south west Xinjiang) has been established as a new Special Economic Zone to promote Central Asia trade

• Development goals by 2015 require:

• 170,000km of new roads

• 8,200km of new rail

• 22 new airports

Steelmaking goals by 2015

• Produce 35mtpa steel by (i.e. 50% more than 2011)

• 10mtpa of special steel production

• Improve blast furnace efficiency – shut blast furnaces smaller than 400m[3 ]

• Only 2% of Xinjiang’s coal is coking

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Xinjiang - key coking coal markets (steel mills)

Key customers

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Urumqi area

• 10mtpa coking coal market by 2015

• Key customer: Bayi Steel 10mtpa steel maker (sub of Baosteel – China’s second largest steel maker)

Yili / Aksu area

• 8mtpa coking coal market by 2015

• Key customers: Shougang and Bayi – 8mtpa steel making between both (Shougang is #5 China steel maker)

Kashgar area

• 9mtpa coking coal market by 2015

• Three new blast furnaces opening 2013-2014

• No local coking coal supply

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Kazakhstan – thermal coal price US$65-90/t

Bishkek / Talas market – US$65105/t

Jalalabad / Osh market – thermal coal price US$110-140/t

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Tajikistan – thermal coal price US$130-160/t

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Existin K r z road ex ort routes to China g y gy p

Export route for Uzgen Basin coking coal

• Uzgen Basin coking coal to Osh (130km)

• Osh to Irkeshtam border crossing (255km)

• Cost to border approximately US$10/t

• Border to Kashgar, nearest major market (231km) – approximately US$5-6/t plus US$4-5/t border crossing costs

• Alternative via Naryn / Torugart (465km to border)

Irkeshtam border crossing

Export route for Alai Range coal

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• Sary Mogol or Bel Alma to Irkeshtam border crossing (110-160km)

• Irkeshtam to Kashgar (231km)

• Costs: US$4-7/t to border plus US$4-5/t border crossing costs plus US$10/t to Kashgar

• Sary Mogol coal sales to Osh at present

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Rail export potential for Uzgen coking coal

Existing primary road route and proposed Trans-Asia Railwa y

• China, Kyrgyz Republic and Uzbekistan have agreed to construct a 20mtpa railway, linking the three countries with Chinese rail at Kashgar

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• Route has been determined and bankable feasibility study is expected soon (with a capital cost estimate US$2-3bn)

• China will sponsor the project to complete by the end of 2016

• Route comes within 10km of Celsius’ Uzgen Basin coking coal project

• Transport distance to the border would reduce to c. 200km, with another c. 150km to Kashgar

• Reduced transport cost estimates of: US$5-6/t to border plus US$4-5/t crossing costs and then US$4/t to Kashgar

• New Trans-Asia railway is estimated reduce logistics cost to Kashgar by around US$6/t to US$14/t and increase capacity

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Resource status 2012 and Soviet era work locations

Kargasha (230 million tonnes)

• Contained in 11 seams (seam cut-off

• 0.5m)

• Seven new 2012 cored holes

• (approximately 3,800m)

• 60 Soviet era drill holes

• (approximately 29,000m)

• 164 Soviet era adits

Kokkia (25 million tonnes)

• Contained in 10 seams (seam cut-off

• 0.5m)

• 16 Soviet era adits

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Milestones and strategies

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• Establishment of customer relationship or distribution partnership (mid 2013)

 Substantially upgraded exploration and analysis campaign – 4 to 5x the amount of drilling, resource estimates, a bulk sample and washability analysis

2013

• Environmental baseline studies

• Design ‘starter’ 1-2mtpa export operation

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• Establish and ramp up ‘starter’ export operation

2014-15

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2016-18

 Finalize feasibility for 5-10mtpa integrated coal mine, washing and export operation

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 Implement scale project and ramp-up to large-scale production

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More on geology

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Geolo ical ma of K r z Re ublic g p y gy p

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			E
					B	H
				F
A
	C
		G
							D

*A-B, C-D, E-F and G-H Interpreted Cross Sections through the Kargasha License showing Celsius 2012 and historical Soviet era drilling.

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Inter reted cross-sections showin 2012 and historical drillin p g g

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A B
4.89m coal 4.29m coal
in 7 seams in 8 seams
C D
4.43m coal
in 4 seams
DD12TK007
DD12TK002
DD12TK001
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Inter reted cross-sections showin 2012 and historical drillin p g g

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E
F
4.94m coal
8.52m coal
in 10 seams
in 16 seams
G
H
1.63m coal 9.28m coal
in 3 seams in 14 seams
DD12TK003 DD12TK006
DD12TK004 DD12TK005
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• Schematic cross section through the Kargasha and Min Teke prospects showing

• interpreted geology and the structure of the Tuyuk formation

• Note the shallow dip of the beds as well as small scale folding resulting in the coal remaining relatively close to the surface

• The Uzgen coal basin has not undergone significant deformation unlike other coal basins in Kyrgyz Republic

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About Kyrgyz Republic

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Countr back round y g

Politics

• Size:199,900km2 (halfway between UK and Greece in size)

• Location: Central Asia, west of China and south of Kazakhstan

• Population: 5.5m people of Central Asian / Turkic decent (83%) and European (mainly Russian) – median age of 25, 60% of population younger than 30

• System: parliamentary democracy

• Key figures

• President: Almazbek Atambayev (SDP) – elected in late-2011 for six-year term

• Prime Minister: Zhantoro Satybaldiev (Ind.) – appointed by parliament September 2011

• History

Econom y

  - Separated from Soviet Union in 1990

• GDP: US$13.1bn (2011 growth 5.7%)

• GDP per capita: US$1,070 (one tenth

• Kazakhstan or Malaysia levels, and around one fifth of Mongolia and China)

• Main GDP constituents: agriculture (20%); metals and mining (14%); industry (13%); and services (51%)

• Unemployment: 8.6%

• 1990-2010: power concentrated in presidency and only two ‘hard line’ presidents

• 2010: protests against president and change to constitutional democracy

• 2010 constitution: reduced the power of the presidency to create a real parliamentary democracy

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China-K r z relations y gy

Premier Wen and PM Satybaldiev (2012)

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• China and Kyrgyz Republic were both founding members of the Shanghai Cooperation Organization in 1996

• China now represents 80% of Kyrgyz export income and Kyrgyz has become the single largest customer for Chinese goods in Central Asia (much re-exported)

• Kyrgyz is receiving assistance on a number of projects – China Road and Bridge Company (CRBC) has completed the re-development of the Osh-Irkeshtam highway with the assistance of a ‘soft loan’ from China Development Bank

New China embass com leted in 2011 y p

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• Chinese assistance is now proposed to extend to a complete re-development of remaining transport infrastructure, together with provision of a tractor manufacturing plant and cotton processing plant

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Basic elements of law and administration

Fiscal re ime g

• Minerals licensing is predominantly managed by the State Agency for Geology (SAG), which reports to the Ministry of Economy as a ministry appointed by the parliament

• Exploration licenses (ELs) are issued by SAG generally for two years

• Total royalty: 4.3%, made up of:

  • Mineral royalty for coal: 2.0%

  • Road tax: 0.8%

  • Emergency prevention tax: 1.5%

• Corporate income tax: 10.0%

• ELs require minimum work programs to be met and then are extendable (for up to ten years)

• Any resource found on an EL can be registered as a resource (ie, registered in the national inventory) and then the EL holder has the exclusive right to a mining license (ML)

• MLs are issued for 20 years and are extendable until the completion of the resource life

Foreign investment protection

• Decree on Protection of Investments – law made in April 2010 alongside the adoption of the new constitution

• Provides protection against illegal seizure or interference of business and employment activities

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Celsius Coal Limited

Registered Office: Level 1, 12 Kings Park Road, WEST PERTH, WA, AUSTRALIA, 6005

Telephone: +61 8 9226 4500 Facsimile: +61 8 9226 4300 Website: www.celsiuscoal.com.au

Email: info@celsiuscoal.com.au

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The information in this announcement that relates to Coal Resources is based on information compiled by Dr Gavin Springbett, a Competent Person who is a Member of The Australasian Institute of Mining and Metallurgy. Dr Springbett is acting as a consultant to Celsius Coal Limited and is an employee of G&S Resources. Dr Springbett has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Dr Springbett consents to the inclusion in this announcement of the matters based on his information in the form and context in which it appears.

The information in this announcement that relates to Exploration Results is based on information compiled by Dr David Hornsby, a Competent Person who is a Member of The Australasian Institute of Mining and Metallurgy. Dr Hornsby is acting as a consultant to Celsius Coal Limited and is an employee of Gallagher Consulting Services Pty Ltd and is a member of The Minserve Group Pty Ltd. Dr Hornsby has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (“JORC Code”). Dr Hornsby consents to the inclusion in this announcement of the matters based on his information in the form and context in which it appears.

The information in this Presentation that relates to Exploration Targets is based on information compiled by Grant Thomas who is Managing Director of Celsius Resources and a Member of the Australasian Institute of Mining and Metallurgy. Mr Thomas has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Mr Thomas consents to the inclusion in this Presentation of the matters based on his information in the form and context in which it appears.

[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 Limited intends to carry out an exploration programme to systematically test the Exploration Targets for each of the Prospects.

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