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Representation of 600 MW Chandgana power plant

Representation of 600 MW Chandgana power plant. Chandgana Coal.

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Representation of 600 MW Chandgana power plant

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  1. Representation of 600 MW Chandgana power plant

  2. Chandgana Coal ChandganaKhavtgai’s resource estimates are based on the September 2010 NI 43-101 ChandganaKhavtgai 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 BehreDolbear & Company (USA), Inc..The report is authored by Mr. Gardar G. Dahl, Jr., CPG of BehreDolbear & Company (USA), Inc., who is an independent Qualified Person under NI 43-101.

  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)

  4. Mongolia Power Supply/Demand 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

  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

  7. Prophecy Power Project Capex 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

  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 *EPC: Engineering, Procurement, Construction; **COD: commercial operation date

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

  11. Management John Lee, CFA – Chairman / CEO Founder of Prophecy Coal Corp. and Prophecy Platinum Corp. JivkoSavov - 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.

  12. Prophecy Platinum (TSXv:NKL OTCQX:PNIKF) • 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 3rd Largest Individual Mine in North America Platinum & PalladiumProduction per Year

  14. Platinum – High Risk of Supply Disruptions Platinum Supply and Demand: • Platinum supply is just 1/10th that of gold and 1/100th 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 Platinum Supply by Region 2011 - Total 6.5Moz Geopolitical Stability Source: Johnson Matthey – Platinum 2012

  15. Questions?

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