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Representation of 600 MW Chandgana power plant. Chandgana Coal 2 Chandgana Khavtgai’s resource estimates are based on the September 2010 NI 43-101 Chandgana.

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Presentation on theme: "Representation of 600 MW Chandgana power plant. Chandgana Coal 2 Chandgana Khavtgai’s resource estimates are based on the September 2010 NI 43-101 Chandgana."— Presentation transcript:

1 Representation of 600 MW Chandgana power plant

2 Chandgana Coal 2 Chandgana Khavtgai’s resource estimates are based on the September 2010 NI 43-101 Chandgana Khavtgai Technical Report by Kravits Geological Services, LLC. The report is authored by Christopher M. Kravits CPG, LPG of Kravits Geological Services, LLC., who is an independent Qualified Person under NI 43-101. And the Chandgana Tal resource estimate is also based on the September 2007 NI 43-101 Chandgana Tal Technical Report by Behre Dolbear & Company (USA), Inc..The report is authored by Mr. Gardar G. Dahl, Jr., CPG of Behre Dolbear & Company (USA), Inc., who is an independent Qualified Person under NI 43-101. Chandgana Coal Resources (Tonnes) Chandgana TalKhavtgai UulChandgana (Total) Measured0.14 billion0.51 billion0.65 billion Indicated-0.54 billion Total M&I0.14 billion1.05 billion1.19 billion

3 Chandgana Power Project Summary First Independent Power Plant (IPP) in Mongolia Mine mouth plant next to Chandgana property 150 MW x 4 in Central Mongolia, 300 km east of Ulan Bator Coal mining and power plant construction licenses obtained Mongolia: Fast growing country in need of energy Licenses owned by Canadian company with good reputation Seeking Joint Venture Partner (not sale of project) 3

4 Mongolia Power Supply/Demand 4 Source: Energy International

5 Strategic Location Central Mongolia (300km east of Ulan Bator): ready access to key markets Adjacent to coal deposit Close to Mongolia 220kV grid: 60km to Eastern and 120km to Central 5

6 Prophecy Power Transaction Structure Sponsor Buy 40% equity interest in Prophecy Power for a one-time payment Obtains rights to project EPC and O&M Contributes pro-rata share of ongoing development expenses and project capex Lead arranger of power plant financing Prophecy Contributes licenses and local knowledge Finalize PPA, EPC, fuel supply contracts Participates in financing Private Equity Sponsor Participates in financing 6

7 Prophecy Power Project Capex 7 Estimated Equity Commitment by year ($million) 2013201420152016Total Sponsor$41$43$39$25$148 Prophecy Coal + PE$60$64$59$37$220 Equity Total$101$107$98$62$368 Debt Total$217$252$263$157$889 Financing Total$318$359$361$219$1,257* Based on total 600MW EPC cost of $1.1 billion, equity/debt funding of 30/70 (*Includes IDC) We anticipate cost to be 65% of above for 300MW only.

8 Strategic Benefits to Sponsor Rare opportunity to enter Mongolian power sector Expected to immediately achieve significant scale in Mongolian market (Phase 1: 600 MW will add 70% to existing installed capacity of 800 MW) Target Tariff with 6 year equity payback, 25% post-tax IRR (assuming 30/70 equity/debt financing) Platform for future growth and development (Phase 2: power export to China) In the Mongolian Power Sector: IPP encouraged to bridge power demand gap Prophecy is the most experienced Canadian company Chandgana is the most advanced thermal power project Prophecy provides permitting and government relations 8

9 Chandgana Power Project Status Project status Over US$50 million invested Coal Mining, Power Plant Construction Licenses received PPA submitted to Mongolian Gov’t in August 2012 Next steps Finalize EPC* by 2012 JV Partner by early 2013 Sign PPA by early 2013 Pour Concrete by Apr il 2013 Financing by end of 2013 COD** (150MW x 2) by early 2016 9 License / ApprovalDateStatus Power Plant Detailed Environmental Impact Assessment November 2010Received Chandgana Mining License January 2011Received Power Transmission Line August 2011Submitted 600 MW Power Plant Construction License November 2011Received Power Purchase Agreement August 2012Submitted Tariff ApplicationAugust 2012Submitted *EPC: Engineering, Procurement, Construction; **COD: commercial operation date

10 Chandgana Coal mine Sponsor acquires 20% equity interest – one time payment Chandgana LLC will develop Coal Mine (total ~$50million) Chandgana will provide coal supply to plant for 25 years 10

11 Management John Lee, CFA – Chairman / CEO Founder of Prophecy Coal Corp. and Prophecy Platinum Corp. Jivko Savov - Director Former Deputy CEO of En+, company owned by Oleg Derispeska Former Chairman of Rusal, Chairman of EuroSibEnergo Michael Deats - Director Former Managing Director of BP Coal South Africa, Ex-Director of Eskom VP Sharma – Technical Advisor 40 years experience in the power industry. Joined CLP Group in 1978. Roles include Director-Head of India, Managing Director of GPEC and CEO of CLP Power India Ms. Lynia Lau - Legal Advisor Hong Kong based partner in law firm Clyde & Co. and the Asian Head of Energy. Advised Shanghai Power Group LTD, Yudean Group Limited, China Three Gorges Group, and Datang Power International in their oversea investment in power plant projects. 11

12 Prophecy Platinum (TSXv:NKL OTCQX:PNIKF) 12 Prophecy Coal spun out Prophecy Platinum in 2011 and retains a 33% equity stake worth ~$27M Prophecy Platinum: –Owns 100% of the Wellgreen PGM-Ni-Cu deposit in the Yukon, which GMP recently indicated was #5 on its list of undeveloped PGM deposits outside South Africa –Recently acquired the Shakespeare PGM-Cu-Ni deposit near Sudbury, which is fully permitted and ready to be mined –Recently put in place a senior management team led by CEO Greg Johnson, co-founder of NovaGold

13 Wellgreen PGM Production Projected to be the 3 rd Largest Individual Mine in North America 13 Platinum & Palladium Production per Year

14 Platinum – High Risk of Supply Disruptions Platinum Supply and Demand: Platinum supply is just 1/10 th that of gold and 1/100 th that of silver South Africa, Russia and Zimbabwe account for 93% of global platinum supply Strong auto catalyst, jewelry and investment demand forecast Implications: Platinum and PGM projects in stable jurisdictions like the Yukon will be highly sought after 14 Platinum Supply by Region 2011 - Total 6.5Moz Source: Johnson Matthey – Platinum 2012 Geopolitical Stability

15 Questions? 15

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