Slide 1: Premium Coking Coal for China and Central Asia
For personal use only PREMIUM COKING COAL FOR CHINA AND CENTRAL ASIA Investment community post site visit review 2013 (August)
Slide 2: Disclaimer
Disclaimer For personal use only 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 sub
Slide 3: Company snapshot
Company snapshot A$42m market cap. focused on coal in Kyrgyz Republic For personal use only Uzgen Basin Coking Coal Project Kargasha Kokkia Min Teke Alai Range licenses Sary Mogol Bel Alma – Licenses containing JORC Resources 3
Slide 4: Uzgen Basin tenements
Uzgen Basin tenements Kargasha, Kokkia and Min Teke are one project For personal use only 4
Slide 5: Near-term goals and objectives
Near-term goals and objectives Fast-track to establish a scale coal export operation For personal use only Become leading Central Asian coking coal supplier to growing Xinjiang Goal Province (China) steel industry and take advantage of increasing demand for other coal types in the region (Kyrgyz,
Slide 6: Large coking coal resource
Large coking coal resource 255Mt JORC Inferred Resource with upside For personal use only Summary of coal Resources (Uzgen Basin Coking Coal)1 Inferred Total Kargasha 230 230 Kokkia 25 25 Min Teke – – Total 255 255 Total targeted tonnages (including exploration targets)2 Resources Expl. target Total
Slide 7: Premium coal
Premium coal Uzgen Basin coals rank with benchmark coking coals For personal use only Chinese coking coal classification system China’s benchmark (Shanxi Liulin – 2012 China pricing Fat (FM) Gas fat (QF) US$190-240/t) 85 Australian benchmark premium 1/3 hard coking coal (Goonyella – Coking (JM) Gas
Slide 8: Coal market review
For personal use only Coal market review Section 1 8
Slide 9: Xinjiang: Close, growing coking coal market
Xinjiang Close, growing coking coal market For personal use only 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
Slide 10: Xinjiang: Bryanston confirms significant coal supply gap
Xinjiang Bryanston confirms significant coal supply gap For personal use only 20+ potential customers identified – five visited as priority targets High sales potential for Celsius coking coal Key Higher coke strength (CSR) coals will have greater price premium learnings Kashgar area of spec
Slide 11: Xinjiang: steel industry facilities and growth
Xinjiang Bryanston study identified steel industry facilities and growth For personal use only Crude steel production (Mt) 22.5 12.0 Aletai Takeshiken 2012 2015e Alashankou Karamay Laoyemiao Yining Changji Torugart URUMQI Hami Irkeshtam Kizilsu Aksu Turpan Kashgar Bayingol Hotan Steel Plant Coking P
Slide 12: Xinjiang: Bryanston and Celsius visited facilities
Tianyuan Coking Co., owned by Shougang I&S (60%) Xinjiang Bryanston and Celsius visited facilities For personal use only Tianyuan Coking Co., owned by Shougang I&S (60%) Baosteel Bayi I&S Aletai Takeshiken Alashankou Karamay Laoyemiao Shandong Steel in Kashgar Yining Changji Torugart URUMQI Hami Irk
Slide 13: Xinjiang: coking coal supply gap has emerged
Xinjiang Bryanston highlighted a coking coal supply gap that has emerged For personal use only Coking coal supply / demand gap1 Prime coking coal supply / demand gap PCC Production (Mt) PCC Demand (Mt) PCC 1/3CC 19.0 18.4 Gas coal Fat coal 16.6 7.0 Lean coal 6.8 6.1 11.5 4.2 7.8 2.9 3.9 3.8 4.0 4.1
Slide 14: Xinjiang coking coal prices move independent of seaborne prices
Xinjiang Xinjiang coking coal prices move independent of seaborne prices For personal use only Xinjiang premium coking coal price vs. seaborne quarterly hard coking coal benchmark price 350 Quarterly Contracted HCC Price (USD/t) Xinjiang PCC Price (USD/t) 300 250 200 150 100 50 Forecast 0 Jan 09 J
Slide 15: Nearby Central Asia: Primarily thermal coal but high value
Nearby Central Asia Primarily thermal coal but high value and growing For personal use only Kazakhstan – thermal coal price US$65-90/t Bishkek / Talas market – US$65- 105/t Jalalabad / Osh market – thermal coal price US$110-140/t Tajikistan – thermal coal price All local indicators show an upward pr
Slide 16: Nearby Central Asia: multiple demand drivers
Nearby Central Asia Regional situation has multiple demand drivers For personal use only Growth opportunities driven by supply shortfalls in regional electricity and gas markets combined with continued growth in cement use Kyrgyz Republic – challenges in supplying certain regional thermal coal m
Slide 17: Potential for significant sales in Kyrgyz Republic itself
Nearby Central Asia Potential for significant sales in Kyrgyz Republic itself For personal use only Major problems in the local electricity market Hydro electricity mainly for export – located away from Kyrgyz demand Increasing local demand for electricity Fuel oil plants expensive to run
Slide 18: Logistics
For personal use only Logistics Section 2 18
Slide 19: Road logistics to China
Road logistics to China Early studies identified two feasible road routes For personal use only Existing Kyrgyz road export routes to China 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$1
Slide 20: New route has been surveyed cutting distance and cost
Road logistics to China New route has been surveyed cutting distance and cost For personal use only Distance from Uzgen Basin Coking Coal Project to Torugart border crossing reduced to 300km Estimated transport cost to border US$8/t 20
Slide 21: Trans-Asia Railway update
Rail logistics to China Trans-Asia Railway update For personal use only Additional route options proposed Kashgar – Irkeshtam – Osh – Andjian Kashgar – Torugart – Balykchi – Kara Keche – Jalal-Abad Both equally beneficial for Uzgen Basin Coking Coal Project Bishkek Kargasha Uzbekistan Osh Ka
Slide 22: Trans-Asia Railway status
Rail logistics to China Trans-Asia Railway status For personal use only Status of current negotiations Feasibility study for both route options completed by China Road & Bridge Corp. Funding under negotiation – firm commitment but timing & final package to be finalised North-South link optio
Slide 23: 2013 – 2014 program
For personal use only 2013 – 2014 program Section 3 23
Slide 24: Concept mining study guiding work program
Kargasha-Kokkia Concept mining study guiding work program For personal use only Independent concept mining study done based on the 2012 geological/resource model Vulcan resource model used Goal of study was to: Identify key areas prospective for mining Determine split between tonnages for
Slide 25: Concept mining study preliminary highlights
Kargasha-Kokkia Concept mining study preliminary highlights For personal use only Three mining methods: auger mining; open-pit; & underground Potential for 30-year overall mine life Various production rate options considered Plan is not optimized & includes prospective mining areas outside o
Slide 26: Concept surface and underground mining areas
Kargasha-Kokkia Concept surface and underground mining areas For personal use only Kargasha Project Area Kokkia Project Area Mining layouts including open pit, underground & auger 26
Slide 27: Concept surface and underground mining areas
Kargasha-Kokkia Concept surface and underground mining areas For personal use only 27
Slide 28: Concept surface and underground mining areas
Kargasha-Kokkia Concept surface and underground mining areas For personal use only 28
Slide 29: Areas of focus for 2013–2014 work program
Kargasha-Kokkia Areas of focus for 2013–2014 work program For personal use only Previous work focused on Kargasha, 2013 program will focus on: Potential of Kokkia – work includes drilling & mapping Likely best near-term value proposition Accelerated surface mining start up potential Tuyuk
Slide 30: 2013 July to September drilling program
Kargasha-Kokkia 2013 July to September drilling progam For personal use only 30
Slide 31: Celsius' other Kyrgyz Coal Projects
Sary Mogol, Min Teke and Bel Alma Celsius’ other Kyrgyz Coal Projects For personal use only Better define geological understanding & likelihood of commercial, high-margin production Extend resources where possible Non-JORC resource assessment Conceptual mine plans for shorter and longer term
Slide 32: New assets: Potential to be a local consolidator
New assets Potential to be a local consolidator For personal use only Our ‘first mover’ knowledge of local coal geology and coal market potential puts us at a great advantage to assess new projects Some potential to secure additional near-term (albeit smaller scale) production projects in Kyrgyz
Slide 33: Quick start auger mine
For personal use only Quick start augur mine Section 4 33
Slide 34: Quick start auger mine
Quick start auger mine Celsius’ first mine could be in production within 18-months For personal use only Concept study highlighted the potential for auger mining (as used at Yarabee mine in Queensland) Celsius identified a concept for a 500-600ktpa ‘starter mine’ potential for 7-8 years initial
Slide 35: Images of third-party auger and high-wall operations
Quick start augur mine Images of third-party auger and high-wall operations For personal use only 35
Slide 36: Government and community
For personal use only Government and community Section 5 36
Slide 37: Government engagement
Government engagement Celsius is proactive and aims to be the best corporate citizen For personal use only Celsius’ operations have now been factored into the five-year Kyrgyz Government development plan for 2013-2017 Means agencies are to prioritize support of Celsius’ activities Strong relat
Slide 38: Community
Community Active community program since early exploration phase For personal use only Recognize the community as having a significant bearing on development Early engagement strategy Investment already underway Provision of winter coal to communities Bridge and road building Contributio
Slide 39: Milestones and strategies
For personal use only Milestones and strategies Section 6 39
Slide 40: Milestones and strategies: Fast-track to establish coal production
Milestones and strategies Fast-track to establish coal production For personal use only 2013 drilling completed by October – analytical data December Bulk sample testing completed December 2013 – off-take agreements soon after Revised resource estimation March 2014 Environmental baseline stu
Slide 41: Contacts
Contacts For personal use only 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 41
Slide 42: Competent persons statement
Competent persons statement For personal use only 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 consu