Pike River Coal Limited PIKE RIVER COAL Emerging Companies Conference

PIKE RIVER COAL Pike River Coal Limited PIKE RIVER COAL Emerging Companies Conference

18 March 2008 For personal use only use personal For Important Notice

• This presentation does not constitute an offer to sell, or recommendation to subscribe for, or purchase, any securities and shall not form the basis of any contract or commitment whatsoever.

• No representation express or implied is made as to the fairness, accuracy, completeness or correctness of the information contained in this presentation. You will be responsible for forming your own opinions and conclusions on such matters. To the maximum extent possible by law, none of Pike River Coal Limited, or their directors, officers, employees or agents or any other person accepts any liability whatsoever for any loss, including without limitation, any liability arising from fault or negligence arising from this presentation or its content.

• The distribution of this presentation in jurisdictions outside New Zealand and Australia may be restricted by law and therefore persons who receive this presentation should seek advice on and observe any such restrictions. Any failure to comply with such restrictions may constitute a violation of applicable securities

laws. For personal use only use personal For

2 PIKE RIVER COAL Pike River Coal Summary

•• Overview

•• Development Progress

•• New Transport Contract

•• Financial Summary

•• Outlook For personal use only use personal For

3 PIKE RIVER Overview COAL

High value hard coking coal (HCC) – used for steelmaking

NZ $240m project – fully funded

70% of coal sold for first 3 years – 55% for life of mine

1 million tonnes for 18 + years

HCC prices to soar – maybe US$200* per tonne + next year

Proven coal transport route with no demurrage issues For personal use only use personal For

*next Japanese Fiscal year commencing 1 April 2008 4 PIKE RIVER Perspective Looking North East COAL

Red Dotted Line – Hawera Fault Access Road

Pike Stream

Western escarpment For personal use only use personal For

5 PIKE RIVER Development Progress COAL

• Mine development substantially de-risked

• $100 m funding package completed March 2008

• Mining plant and equipment being delivered to site

• New improved coal transport

agreement For personal use only use personal For

6 PIKE RIVER Mine Development De-risked COAL

• Tunnel advanced to 1985 metres

• Pit bottom excavations (eastern side) 60% complete (500 metres)

• Slurry pipeline to tunnel entrance installed

• Coal preparation plant > than 60 % complete

• Road header delivered to site and two continuous miners 70%

complete For personal use only use personal For

7 PIKE RIVER COAL $100 Million Funding Completed

• NZ $60m rights issue to shareholders/noteholders – Offer of 66.667m shares at $0.90 per share oversubscribed by 5% – More than 2,000 shareholders applied for additional shares

• US $30 million convertible bond issue – To Liberty Harbor (part of Goldman Sachs Asset Management) – Three year term, 6.75% interest rate – Convertible to ordinary shares at $1.17 each

– Valuable financing relationship For personal use only use personal For

8 Pro-forma Financial Summary

31 December 2007 Adjustments1 Pro-forma

Assets $ 171.9 m $ 94.1 m $ 266.0 m

Liabilities $ (12.4) m $ (37.4)2 m $ (49.8) m

Net assets $ 159.5 m $ 58.1 m $ 217.6 m

Number of shares 200,000,000 66,666,667 266,666,667

Debt to debt + equity 0.5 % n/a 14.5 %

Market cap (@$1.06)3 $ 212.0 m n/a $ 282.7 m

Notes 1 a) Rights issue proceeds and b) issue of convertible bonds to Liberty Harbor LLC. Shows cash impact on balance sheet and may not necessarily reflect the underlying book value which would be recognised for financial reporting purposes 2 USD30 million of convertible bonds are shown at the NZD:USD rate of exchange on the date of issue (0.80275) – this differs slightly to the NZD40 million

quoted previously which was premised on a working assumption of a 0.7500 NZD:USD rate of exchange For personal use only use personal For 3 Market capitalisation is based on all shareholdings not free-float - $1.06 price is as at close of business 12 March 2008 9 Capital & Funding Structure

Structure Number Value (NZDm) Equity Listed ordinary shares 266,666,667 260.0 Unlisted ordinary shares 200,000 0.2 Shareholdings Number % Convertible notes (equity) 10,091,743 9.5 (shares m) NZOG 81.7 30.6 Share options1 22,500,000 - Gujarat 26.2 9.8 Partly paid ESOP shares2 3,352,820 0.1 Saurashtra 22.3 8.4 Sub-total (equity): 269.8 Public 136.5 51.2 Debt TOTAL: 266.7 100.0 Convertible notes (debt) - 0.9 Convertible bonds 600 37.4 Sub-total (debt): 38.3 TOTAL: 302,811,830 308.1

1 Assumes share options are not exercised For personal use only use personal For

2 Reflects amounts currently paid up on ESOP shares 10 PIKE RIVER Improved Coal Transport Agreement COAL

•• New 18 year agreement (November 2007) with Solid Energy •• Lower cost than alternative •• Pike River to fund coal loadout facility of $11 million •• Reduced transport cost now at

$38 per tonne For personal use only use personal For

11 PIKE RIVER Management Team COAL

Peter Whittall Kobus Louw Neville Rockhouse Udo Renk General Manager, Mines Production Manager Safety & Training Manager Technical Services Manager 27 years, 24 BHP underground 13 years, ex underground 20 years coal , NZ Institute of Safety 15 years RAG coal manager for Sasol Management

For personal use only use personal For Ivan Liddell Tony Goodwin Bob Reynolds Paul Bywater Environmental Manager Engineering Manager Marketing Advisor Financial Controller 10 years Fonterra environmental 22 years incl. Xstrata longwall 33 years coal, 17 in marketing 12 years, 3 as Meridian group 12 management treasurer PIKE RIVER Mine Plan COAL

Western escarpment •• Roadway development by roadheader and 2 continuous miners

•• Extraction by hydraulic monitor

Tunnel •• All product conveyance by water

•• Average production 1 Mt

pa saleable at 1% ash For personal use only use personal For

13 PIKE RIVER COAL Mining Extraction by Hydraulic Monitor

ParametersParameters forfor success:success: •• Strong roof and floor •• Strong but fractured coal •• Moderate to thick seam (3-13m) •• Moderately dipping seam (5°-30°) •• Good supply of water (Pike has rainfall of over 6 m/year in mine

vicinity) For personal use only use personal For

14 PIKE RIVER COAL Production Timetable

•• Forecast to meet coal seam early July 2008

•• Forecast production for year 1,400,000 ended June 2009 is 200,000 1,200,000 tonnes 1,000,000Tonnes 800,000

600,000

•• Forecast production for year 400,000 ended June 2010 is 1 200,000 million tonnes 0

2009 2010 2011 2012 2013 For personal use only use personal For

Year ended 30 June 15 PIKE RIVER COAL Coal Qualities

ASH (max % air dried) MAX FLUIDITY (log 10) 12 6 10 5 8 4 6 3 4 2 2 1 0 0

Australian hard Pike Australian hard Pike coking coals River coking coals River

Pike River coal is a low ash (1%) , high fluidity, low phosphorous, moderate sulphur hard coking coal of 58 For personal use only use personal For million tonnes in ground resource 16 PIKE RIVER Outlook COAL

• Hard coking coal prices set to soar • Recent events – Rail and port infrastructure limitations in Australia – Queensland flooding (up to 15 million tonnes lost production) – Snowstorms in China – Power supply disruptions closing export mines in South Africa • Brokers now forecasting US $200+ per tonne for 2008/09* • Prices then expected to ease, but still much higher than prior forecasts

*benchmark price for premium hard coking coal (year commencing 1 April 2008) For personal use only use personal For

17 PIKE RIVER Coal Price Graph COAL

250

200 1

150

100 USD$ per tonne

0 1981 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 Long

For personal use only use personal For Japanese Fiscal Year (year beginning 1 April) term

Historic Pike River IPO forecast Broker forecast Broker forecast 18

1 Prices shown are for hard coking coal PIKE RIVER Contact Details COAL Pike River Gordon Ward Peter Whittall Chief Executive General Manager, Mines +64 4 494 0190 +64 3 769 8401 +64 21 566 331 +64 27 664 4695 [email protected] [email protected]

John Draper Investor Relations Consultant +64 9 309 5657 +64 21 581 234

[email protected] For personal use only use personal For