HispanicBusiness

The New Wash Plant is currently focused on processing coal from the Company's existing waste tip. The initial processing of waste from Waste Tip No. 4 has shown a 10 per cent. coal content and initial analysis indicates that reprocessing the tip is economically viable.

The Company expects to increase total production from Menzhinsky from the current level of approximately 6,000 tonnes per month to 26,000 tonnes per month during 2013.

As the underground mining is developed, and further longwalls are introduced, the planned tonnage is projected to increase year on year to reach the design capacity run of mine tonnage of one million tonnes per year.

Key Strengths

The Company's business and operations require specialised skills and knowledge in the areas of geology, drilling, logistical planning and implementation of extraction programmes, treasury and accounting. The Company has these abilities through its management, consultants and contractors. The Board has extensive experience in successfully developing mines and has a strong knowledge of the region. To date, the Company has been successful in hiring and retaining employees and consultants with the required skills and believes it will continue to be able to do so as it seeks to develop each of the Verticalnaya Mine and the Menzhinsky Mine.

Skills needed for financing activities, which will be critical to the implementation of the Company's strategy, are available through the Board and management. The composition of the Board has changed in the past two years, bringing significant experience in the financing of coal projects as well as technical and management skills in developing coal projects.

Directors

John Byrne (63), Executive Chairman and Chief Executive Officer

Mr. Byrne joined the Company as a Director and Executive Chairman on 27 July 2010. He has more than 35 years experience in the resource industry as an investor and resource business developer. Mr. Byrne has had extensive involvement in the resources industry in Australia, Canada and South Africa with a particular focus on financing new and established resource projects.

Mr. Byrne served as the chairman of the board of Western Coal Corp. until 31 May 2010 and as a Director of that company from June 2001 to 31 May 2010. He has been an executive chairman of Deepgreen Minerals Corporation Limited since 30 March 2007 and serves as executive chairman of Wasabi Energy Ltd.

Abraham Jonker (44), Director and President

Mr. Jonker was the chief financial officer of Western Coal Corp. for just under two years until its acquisition by Walter Energy Inc. in 2011. He is a member of the Board of Directors of Firestone Diamonds plc, Canada Coal Inc., where he is also CEO and President, and Mandalay Resources Corporation, where Mr Jonker is also the non-executive chairman of the board. Mr. Jonker has almost 20 years of accounting and corporate finance experience primarily in the mining industry. Mr. Jonker is a Chartered Accountant registered in South Africa (South African Institute of Chartered Accountants - SAICA) and England and Wales (Institute of Chartered Accountants of England and Wales - ICAEW). Mr. Jonker holds a Masters Degree in South African and International Tax from the Rand Afrikaans University. Mr. Jonker became the President of EastCoal Inc. on 1 March 2012.

Colin Stocks (70), Director and Technical Director

Mr. Stocks has over 35 years of management experience with British Coal, during which time he attained the position of colliery manager. Upon leaving British Coal he became a consultant mining engineer working for several consultancy companies on projects in the UK, Spain, India, China, USA, Egypt and Ukraine. These included a long term assignment as the team leader of a EU funded project to assist the Ukrainian Government in their coal industry re-structuring programme. Thereafter, Mr. Stocks was associate consultant mining engineer with IMC Group Consulting, then senior mining engineer with Cambrian Mining plc and Coal International plc (now Western Coal Corp.). He assisted these companies expand their mining business in both the EU and Eastern Europe and also worked with Xtract Energy plc, an associate of Cambrian Mining plc and Coal International plc. During the same period he also undertook the duties of senior mining engineer for Ukraine Coal Limited. Prior to joining the Board Mr. Stocks worked with East Coal on pre-feasibility studies and the preparation of documentation for obtaining the rights to Verticalnaya Mine. Mr. Stocks has been employed as an independent consultant mining engineer to the Company since October 2008 and became the Company's Technical Director and a member of the Board in 2009.