Corporate Booklet 3rd Quarter 2014 Coal Exploration and Development Company South Africa www.insacoal.co.za
Disclaimer Some of the statements contained in this corporate booklet may be forward-looking statements. All statements, other than statements of historical fact, that address activities, events or developments that INSA COAL believes, expects or anticipates will or may occur in the future are forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as seek, anticipate, believe, plan, estimate, expect and intend and statements that an event or result may, will, can, should, could or might occur or be achieved and other similar expressions. These forward-looking statements reflect the current expectations or beliefs of INSA COAL based on information currently available to INSA COAL. Forward-looking statements are subject to a number of risks and uncertainties that may cause the actual results of INSA COAL to differ materially from those discussed in the forward-looking statements, and even if such actual results are realised or substantially realised, there can be no assurance that they will have the expected consequences to, or effects on INSA COAL. Factors that could cause actual results or events to differ materially from current expectations include, among other things, failure to successfully complete intended financings, capital and other costs varying significantly from estimates, production rates varying from estimates, changes in world mineral product markets, changes in equity markets, uncertainties relating to the availability and costs of financing needed in the future, equipment failure, unexpected geological conditions, imprecision in resource estimates, success of future development initiatives, competition, operating performance of facilities, environmental and safety risks, delays in obtaining or failure to obtain necessary permits and approvals from government authorities, and other development and operating risks. Any forward-looking statement speaks only as of the date on which it is made and, except as maybe required by applicable securities laws, INSA COAL disclaims any intent or obligation to update any forward-looking statement, whether as a result of new information, future events or results or otherwise. Although INSA COAL believes that the assumptions inherent in the forward-looking statements are reasonable, forward-looking statements are not guarantees of future performance and accordingly undue reliance should not be put on such statements due to the inherent uncertainty therein. No representation or warranty, expressed or implied, is made and no reliance should be placed on the accuracy, actuality, fairness or completeness of the information presented. INSA COAL, its directors, officers, employees, agents, advisors and any other person, shall have no liability what so ever for any losses arising, directly or indirectly, from any information contained in this presentation. This presentation does not constitute an offer or invitation to purchase or subscribe for any shares in INSA COAL. By accepting this corporate booklet you acknowledge that you will be solely responsible for your own assessment of INSA COAL and that you will conduct your own analysis and be solely responsible for forming your own view as to the potential future performance of the company s business. This corporate booklet speaks as of 15 January 2014. Neither the delivery of this corporate booklet nor any further discussions of INSA COAL with any of the recipients shall, under any circumstances create any implication that there has been no change in the affairs of INSA COAL since such date. All subsequent oral or written forward-looking statements attributable to INSA COAL or any director, employee agent of INSA COAL or any persons acting on their behalf are expressly qualified in their entirety by the cautionary statement above. 2
Profile Privately owned Coal Holdings Company 50:50 JV between Action Group of India & Incubex Minerals of SA South African based and HDSA compliant Large portfolio of coal prospecting rights (± 2 Billion tonnes potential) Coal projects are in established coal fields with existing infrastructure, historical data and regarded as Brownfield Board & Management team with more than 100 years mining industry experience, highly qualified and with proven management track records. 3
Company Structure 4
Board and management Nand Aggarwal (BSc Eng) - Director o Founder, owner and Chairman of the Action Group. o In 1970 s started manufacturing footwear. Today the group has diversified into real estate, chemicals, electronics, building materials, steel, power, hospitality, hospitals and mineral resources. o Commended with the National Award by the Honourable President of India, Mr. Giani Zail Singh in 1986 for his contribution to the industrial development. Ajay Aggarwal (BSc Eng, MBA) - Director o Director of Action Group and many of its large scale ventures, he is managing and running many important and large scale ventures of Action Group. o Made a tremendous name for himself and the Action Group in sectors like real estate, Electronics, Particle & MDF Boards. Jitin Bhatia (BCom) - Director o Head of Business Development for Action Group and directly responsible for operations in South Africa. o Played a vital role in getting the group into sectors like solar power, hydro power and coal mining. o Worked on various acquisition deals across sectors like IT, real estate, hospitality, coal etc, not only in India but also in countries like Indonesia, US, Mauritius and South Africa. o A strong professional individual with good leadership qualities. Dr Lelau Mohuba (MB, ChB) Chairman o Retired medical practitioner. o Co-founder of the Sephaku Group. o Currently serves as Chairperson at INSA, Incubex Minerals, Sephaku Holdings, Taung Gold Ltd, Sephaku Fluoride Lt (SepFluor) and Miranda Mineral Holdings. Alan Smith (BSc Eng - Mining) - Director o Ex-Anglo American and De Beers, in charge of AngloGold Ashanti SA operations. o Later exposure to the junior industry: CEO of NDC, LDC and Kivu Resources o Currently serves as CEO of Incubex Minerals. o Strong Managerial and technical expertise. Dr John Bristow (PhD Geochemistry) - Director CEO of Incubex Minerals o Extensive local and international experience o 12 years with Anglo American and De Beers o Created successful private and listed junior mineral companies Dirk Fourie (BEng - Mining, MBL) COO o 35 years coal industry experience o Previously at BHP Energy Coal SA (Manager Mining); MD of a private mining construction company; Coal Supply Manager at Eskom (Coal Division); and Vice President for Wood Mackenzie Consulting (Africa) o Due to his varied occupational fields within the coal sector he has in-depth knowledge of the coal business from managing mining, to coal procurement, to the investment & evaluation of coal projects. 5
Investment case Substantial coal portfolio of almost 2 Billion tonnes potential. Most rights are adjacent or close to existing mines or projects, thus potential to merge with other rights holders exist. INSA has strong and dedicated team, low overheads and outsources specialist studies. The objective is to provide significant shareholder value in three to five years. o Step 1: Identify and obtain prospecting rights (PR) according to the stringent DMR pre-requisites. All PR s are held in various subsidiary companies below Holdings Company. o o o Step 2: Utilise INSA funds as seed capital to explore and to develop initial value. Step 3: Form Joint Ventures at subsidiary level, or for individual prospecting rights, alternatively form a NewCo. INSA may opt to develop the project independently. 6
Value creation model Bloemendal Greater Bloemhof Dunbar Hendrina TNC / CPR / CPR Diversified early stage project portfolio 7
Location of Prospecting Rights Legend: Granted Project Awaiting Grant 8
INSA Rights in Mpumalanga & Gauteng Legend: Granted Project Awaiting Grant Copyright acknowledgement to Barker Coalfields Map 8
Summary of Prospecting Rights Province No. of Rights Hectares Estimated Tonnes (MT) Prospecting Rights Granted (Subtotal) 41 105 319 1 103 Executed PR 11 23 343 517 Gauteng 3 15 704 345 Mpumalanga 20 28 805 424 KZN 18 60 810 334 Prospecting Rights Accepted for Grants (Subtotal) 18 31 847 338 Gauteng 1 1 213 36 Mpumalanga 13 19 400 240 KZN 4 11 234 62 Prospecting Rights Applications in Pipeline (Subtotal) 4 39 933 557 Total Potential 63 177 100 1998 10
Featured Projects INSA has many Prospecting Rights, which may strategically be grouped into projects. Projects are placed on a priority list. For this booklet, INSA selected a few projects to demonstrate the potential of the projects INSA INFORMATION BRIEF 3rd Quarter 2014 11
Featured Project - Gauteng South This Project is east of Johannesburg and consist out of 2 Prospecting Rights, estimated at 293 GTIS Bloemendal 38km South East of OR Thambo Airport Several historical boreholes 28 Newly drilled boreholes 63 Million tonnes on inferred classification Some Open pit potential (27MGTIS) Seam Thickness 3.06m 12m Quality ±18 22MJ/kg (4300-5250 kcal Raw) Total Estimated 263 Million tonnes GTIS Total area is 11 113 hectares Devon 16km East of Bloemendal PR Mainly underground mining (>60m depth) Some historical holes showing 3 seams Minable Seam thickness 6m & 2m respectively Quality ± 20 23MJ/kg (4800-5500 kcal Raw) Estimated 30 Million tonnes GTIS Total area is 1 455 hectares 12
Mpumalanga Projects INSA INFORMATION BRIEF 3rd Quarter 2014 13
Mpumalanga Rights, Projects & nearby Railroads Teutfontein 252 ha 8 MT Hartbeeslaagte 729 ha 46 MT Rhenosterfontein 572 ha 2 MT Hendrina 13 309 ha 186 MT TNC 685 ha 43 MT Vlaklaagte 585 ha 16 MT Dunbar 1244 ha 64 MT Greater Bloemhof 5993 ha 71 MT De Goede Hoop 3146 ha 28 MT MAPUTO RBCT Mooimeisjesfontein 1867 ha 22 MT Uitspanning 348 ha 4 MT 14
Featured Project - TNC High potential Mpumalanga Project Granted & Executed - 685ha Coal seams no 5, 4, 2 & 1 potential. TNC is a large (±4500ha) historical defunct underground mine. No 2 Seam select horizon extensively mined by BHP with underground mining methods, mined over the whole area. INSA s Right covers only 685ha of total TNC defunct mine of which about 100ha has been mined out by openpit methods.. Some historical information obtained from BHP, mainly on the No. 2 & 1 seams 30km South of Witbank Adjacent to Universal Coal s New Clydesdale, Shanduka s TNC Projects, Muhanga Mines, Xinovo Mining & Total Coal. Resource Statement done by PC Meyer Consulting who also did the resource calculation for the adjacent Muhanga mines. 15
Featured Project - Dunbar The project consists out of 2 prospecting rights, called Middelkraal and Dunbar. A total tonnage of 64 Million Tons is estimated. Total Area 1244 hectares The project have export quality potential, with Eskom feed. Many export and domestic product mines are adjacent to the project. A portion of Dunbar West TNC is envisaged to be open-pit resource. Some historical information obtained from BHP, mainly on the No. 2 and 4 Seam Nearby Universal Coal s New Clydesdale, Shanduka s TNC Projects, Muhanga Mines, Xinovo Mining & Total Coal. 16
Featured Project - Greater Bloemhof Province: Mpumalanga Tonnage (GTIS): Estimated 71 Million tonnes Size: 5 993 hectares ( Brownfields ) Status: 2 major seams - not mined CPR: Not explored recently but some historical information available Open pit potential: Estimated 7 Million tonnes Infrastructure: Rail, siding & road - Excellent Markets: Export & domestic (close to many Eskom power stations) Quality: Bituminous coal. Close to well known export mines (Forsando of Total) 17
Featured Project - Hendrina Province: Mpumalanga ( Brownfields ) Tonnage: ± 186 Million tonnes Size: 13 309 hectares ( Brownfields ) Status: Major seams present, not mined CPR: Not explored recently but some historical information available. Open pit potential: Estimated 10 Million tonnes Infrastructure: Rail, siding & road - Excellent Markets: Export & domestic (close to many Eskom power stations) Quality: Bituminous coal. Close to well known export mines. 18
Featured Project - Vlaklaagte Legend: Granted PR Provincial Border National Roads National Freeway Railway Province: Mpumalanga ( Brownfields ) Tonnage: ± 16 Million tonnes Size: 1 408 hectares ( Brownfields ) Status: Major seam 4L present, not mined. Some 2 seam recorded. Coal wash well to export quality. CPR: Not explored recently but some historical information available. Infrastructure: Rail, siding & road - Excellent Markets: Export & domestic (close to many Eskom power stations) Quality: Bituminous coal. Close to well known export mines. 19
Featured Project - Hartbeeslaagte Legend: Granted PR Provincial Border National Roads National Freeway Railway Prime Coal area in Witbank district Province: Mpumalanga ( Brownfields ) Tonnage: ± 46 Million tonnes Size: 729hectares ( Brownfields ) Status: Major seams present, not mined CPR: Not explored recently but vast amount of historical information available. Open pit potential: Estimated 30 Million tonnes Infrastructure: Rail, siding & road - Excellent Markets: Export & domestic (close to many Eskom power stations) Quality: Bituminous coal. Close to well known export mines. 20
KZN Rights, Projects & nearby Railroads 21
Conclusion Should any of our projects be of interest to you, then kindly contact our Chief Operating Officer Mr Dirk Fourie for more detailed discussions. INSA is prepared to look at all kind of investments options, thus JV s (major or minority shareholder), collaboration agreements and also total buy-outs. These will be done at project or subsidiary level. Investment into the Holdings Company will also be considered. All investments must take the DMR s BEE requirements into account. 22
Contact details COO Dirk Fourie Tel +27 12 771 4411 Fax +27 86 604 5100 Website www.insacoal.co.za Email info@insacoal.co.za Address 0157 2nd Floor, Tugela House, Riverside Office Park, 1303 Heuwel Ave, Centurion, PO Box 68727, Highveld, 0169 South Africa