Fmc corporate presentation mar 2012

TSX/JSE : FMC March 2012

GROWING COAL PRODUCER IN SOUTHERN AFRICA

CORPORATE PRESENTATION

A Forbes & Manhattan Group Company

Disclaimer TSX/JSE : FMC

This presentation contains forward-looking statements under Canadian securities legislation. Forward-looking statements include, but are not limited to, statements
with respect to the development potential and timetable of the Magdelena and Aviemore projects; the Company’s ability to raise additional funds as necessary;
the future price of coal; the estimation of mineral resources; conclusions of economic evaluations (including scoping studies); the realization of mineral resource
estimates; the timing and amount of estimated future production, development and exploration; costs of future activities; capital and operating expenditures;
success of exploration activities; mining or processing issues; currency exchange rates; government regulation of mining operations; and environmental risks.
Generally, forward-looking statements can be identified by the use of forward-looking terminology such as “plans”, “expects” or “does not expect”, “is expected”,
“budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates” or “does not anticipate”, or “believes”, or variations of such words and phrases or
statements that certain actions, events or results “may”, “could”, “would”, “might” or “will be taken”, “occur” or “be achieved”. Forward-looking statements are
based on the opinions and estimates of management as of the date such statements are made. Estimates regarding the anticipated timing, amount and cost of
mining at the Company’s projects are based on assumptions underlying mineral resource estimates and the realization of such estimates; results of previous mining
activities at the projects, and detailed research and analysis completed by independent consultants and management of the Company; research and estimates
regarding the timing of delivery for long-lead items; and knowledge regarding certain factors described in the technical report filed under the profile of the
Company on SEDAR. Capital and operating cost estimates are based on results of previous mining activities, research of the Company and independent
consultants. Production estimates are based on mine plans and production schedules, which have been developed by the Company’s personnel and
independent consultants. Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results,
level of activity, performance or achievements of the Company to be materially different from those expressed or implied by such forward looking statements,
including but not limited to risks related to: timing and availability of external financing on acceptable terms; unexpected events and delays during construction,
expansion and start-up; variations in ore grade and recovery rates; receipt and revocation of government approvals; actual results of exploration and mining
activities; changes in project parameters as plans continue to be refined; future prices of coal; failure of plant, equipment or processes to operate as anticipated;
accidents, labour disputes and other risks of the mining industry. Although management of the Company has attempted to identify important factors that could
cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated,
estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from
those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. The Company does not undertake to
update any forward-looking statements except in accordance with applicable securities laws.

Investors are advised that National Instrument NI 43-101 of the Canadian Securities Administrators (“NI 43-101”) requires that each category of mineral reserves and
mineral resources be reported separately. Mineral resources that are not mineral reserves do not have demonstrated economic viability. Johan Odendaal,
B.Sc.(Geol.), B.Sc.(Hons)(Min. Econ.), M.Sc. (Min. Eng.), a director of Minxcon and an independent Qualified Person, as defined in National Instrument 43-101 has
reviewed and approved the scientific and technical information contained in this presentation.

Cautionary Note to U.S. Investors Concerning Estimates of Measured, Indicated or Inferred Resources
The information presented uses the terms “measured”, “indicated” and “inferred” mineral resources. United States investors are advised that while such terms are
recognized and required by Canadian regulations, the United States Securities and Exchange Commission does not recognize these terms. “Inferred mineral
resources” have a great amount of uncertainty as to their existence, and as to their economic and legal feasibility. It cannot be assumed that all or any part of an
inferred mineral resource will ever be upgraded to a higher category. Under Canadian rules, estimates of inferred mineral resources may not form the basis of
feasibility or other economic studies. United States investors are cautioned not to assume that all or any part of measured or indicated mineral resources will ever
be converted into mineral reserves. United States investors are also cautioned not to assume that all or any part of an inferred mineral resource exists, or is
economically or legally mineable.

2

Company Overview TSX/JSE : FMC

Forbes & Manhattan Coal Corp.’s (“Forbes Coal” or the “Company”) vision is to
build a high quality bituminous and anthracite coal company with production
capacity in excess of 10 million tonnes per year

Company Summary
Headquarters: Toronto, Ontario Total coal resource 51.7 million tonnes Bituminous
(NI 43-101): 35.7 million tonnes Anthracite1
(15.1 million tonnes anthracite inferred)

Number of 2 (Magdalena Historical annual saleable 923,700 saleable tonnes in
mines: and Aviemore) production: fiscal 2012

Mine location: Kwa-zulu, Natal, 1 year target production2: 1,000,000 saleable tonnes
South Africa Bituminous - Magdalena
420,000 saleable tonnes
Anthracite - Aviemore

Production capacity: 1.5 million saleable tonnes

1. As set out in the Technical Report of the Company entitled “An Independent National Instrument 43-101 Technical Report on Slater Coal and Subsidiaries,
KwaZulu-Natal Province, South Africa”, dated March 1, 2011, prepared for the Company by Minxcon (the “Technical Report”). A copy of the Technical
Report is available under the profile of the Company on SEDAR at www.sedar.com. 3
2. As per management’s guidance

Investment Highlights TSX/JSE : FMC

 Strategic assets in one of the best developed coal markets in the world

 Resource base of high quality bituminous and anthracite coal

 Ability to TRIPLE production within three years from 2010 historic levels using existing
infrastructure and capacity

 In-place infrastructure to reach export corridors and growing domestic market

 Substantial upside through organic production growth and strategic acquisitions

 Experienced coal-focused management team

As per management’s guidance

4

Experienced Management Team TSX/JSE : FMC

 Stephan Theron, B.Comm, CGA │President and Chief Executive Officer
Extensive management, project finance and equity analysis experience in the mining, energy and infrastructure
sectors
Previous capital and project experience includes Weir PLC and AMEC PLC
Former sector head materials and energy with a specific focus on South African coal market

 Malcolm Campbell, Pr. Cert. Eng. (Mining) │Chief Operating Officer
Fourth generation coal miner with 25 years industry experience
Skilled in operational management, turnaround strategies and business development
Spent 20 years with Anglo Coal; held a variety of positions including Regional Manager for New Business
Development and Strategy

 Kuda Muchenje, │VP Exploration & Development
Seasoned exploration geologist with over 15 years experience in the generation of exploration targets and
management of exploration and evaluation programs
Former Country Manager(Mozambique)for Rio Tinto

 Deb Battiston, CGA │Chief Financial Officer
Financial specialist with over 20 years experience in the mining sector

 Sarah Williams, CA │Vice President Finance
Chartered Accountant (SA) with nine years experience in the corporate finance industry
Expertise is in the resource sector where she played key roles in company listings and IPOs, mergers and
acquisitions, restructurings and debt and equity capital raisings.

Kevern Mattison, NHD (Mining), B. Tech.│General Manager
More than 20 years operational coal mining experience
Spent over 20 years with Anglo Coal, most recently Manager Mining

5

Directors TSX/JSE : FMC

 Stan Bharti, P.Eng. │ Executive Chairman
Business consultant and a professional mining engineer with more than 25 years experience
Founder and Chairman of Forbes & Manhattan, Inc., a private merchant focused on the resource
sector, since July 2001

 Stephan Theron, B.Comm, CGA , │ President and CEO

 David Stein, MSc., CFA │ Director
Over nine years of asset evaluation, research and corporate finance experience
President and Director of Aberdeen International (seed investor in Forbes Coal)

 Grant Davey, P. Eng. │ Director
Mining Engineer with close to 20 years experience in coal, platinum and gold mining industry
Previously held senior operational management roles for Anglo American in South Africa & Australia

 David Gower, P. Geo. │ Director
Professional Geologist and the former Global Head of Nickel Exploration for Falconbridge

 Ryan Bennett, M.Mining Eng. │ Director
Masters degree in Mining Engineering from the Colorado School of Mines
Extensive technical mining project analyses experience
Senior Partner of Resource Capital Fund;(significant shareholder in Forbes Coal)

6

Progress to Date TSX/JSE : FMC

Corporate Milestones…dual listed with experienced management team Forbes Coal reports revenue
of $31.2 million in fiscal third
Completed RTO within 60 quarter 2012, an increase of
Closed CDN$42 million capital
days, began trading on the 245% year-over-year
raise at $4.55/share; Forbes
Toronto Stock Exchange under
the symbol “FMC”
Coal increased ownership in January 2012
Slater Coal to 76.75%; Secured ZAR230 million
September 2010 Completed second NI 43-101 (approximately $C30 million) Forbes Coal earns 100%
Technical Report loan facility from Investec to interest in Slater Coal
fund Company’s expansion Properties
March 2011
November 2011 February 2012

Operational Highlights…production up 33% since acquiring the Slater Coal properties
Year-over-Year
Signed three year offtake production and sales
Increased export capacity at
agreement with leading energy significantly improve
Navitrade Terminal at Richards
trading company for 1.75 million • ROM production
Bay; Magdalena upgraded
tonnes of thermal coal; increases 38%
mining operations; increased
January and February 2011 • Saleable production
saleable production capacity
production increases 28% increases 43 %
by 330,000 tonnes per annum
• Total sales increased
April 2011 104%
December 2010 March 2012

7

Ramping Production and Sales1 TSX/JSE : FMC

Run of Mine Production Saleable Production
923,697
1,290,799
648,048
934,023
+38% +43%

FY2011 FY2012 FY2011 FY2012
(Mar 10 - Feb 11) (Mar 11 - Feb 12) (Mar 10 - Feb 11) (Mar 11 - Feb 12)

1,081,814

Total Sales

529,256 +104%

FY2011 FY2012
(Mar 10 - Feb 11) (Mar 11 - Feb 12)

1. All figures are tonnes
8

Strong Financial Results Reflecting Growth TSX/JSE : FMC

Q1 2012 Q2 2012 Q3 2012 % Change
(Mar – May 2011) (Jun – Aug 2011) (Sept- Nov 2011) (YTD)

Revenue $19.6 million $35.2 million $31.2 million + 59 %

Gross Profit $4.2 million $5.6 million $6.8 million + 62 %

Consolidated
$5.6 million $6.9 million $8.2 million + 46 %
EBIDTA

Cash and Cash
$19.8 million $24.2 million $16.8 million - 15 %
Equivalents

9

Access to Lucrative Export Markets TSX/JSE : FMC

• For Fiscal 2012 Forbes Coal reported record export sales of 578,000 tonnes an increase of
179% from Fiscal 2011, reflecting strong demand from export markets
• Global thermal trade flows show India and China as major global importers of thermal coal
― South Africa exported an estimated 23 million tonnes of thermal coal to India in 2010
• Asia dominates demand for anthracite coal
― 83% of global imports; 95% of expected export demand growth1

Global Thermal Coal
Trade Flows

1. Source : Company Reports
10

Coal Markets Overview TSX/JSE : FMC

Thermal Metallurgical
• Aviemore one of four listed
metallurgical (anthracite) coal
• Thermal (bituminous) coal sold producers in South Africa
directly to independent industrial
companies in South Africa • Cost-effective replacement for coking
Domestic • Thermal coal sold at circa US$80
coal/coke

per tonne vs low quality coal sold • Applications include iron ore
to Eskom priced at US$20 - 30 per pelletizing, PCI for blast furnaces,
tonne calcining for electrode
manufacturing, ferroalloys and power
generation

• Demand increasing from emerging
Asian markets, especially India and
China • Demand driven by the metal refining
industry
• Indian government expecting
domestic coal shortfall of approx. 112
million tonnes for year ended March
• Pricing highly correlated with PCl coal
Export 2012; 35% increase from previous
forecasts
prices

• Australian coal producers starting to
• South African coal exports to India settle PCl contracts at a record
increased 161% 2008 – 2009 US$275 per tonne FOB for April –June
quarter 1
• China imported165 million tonnes of
coal in 2010, up 31% from prior year

Source: Company reports
1. McCloskey Coal Report, March 22, 2 011
11

Established Mining Region TSX/JSE : FMC

Source: Company reports
12

TSX/JSE : FMC

Company Outlook

13

2010 – 2013 Mine Plan TSX/JSE : FMC

• Increasing production: saleable production is expected to grow at a CAGR of
41% from 2010 to 2013
– Driven by expansion of production from the Magdalena and Aviemore underground
mines

Saleable Production1
(000 t)
1,423

924

648

505

2010FY 2011FY 2012FY 2013FY

Bituminous Anthracite

1. Source: National Instrument 43 – 101 Report (Minxcon March 1, 2011) available under the profile of the Company on SEDAR at www.sedar.com.
14

Positioned for Multi-Year Export Growth TSX/JSE : FMC

SECURED ADDITIONAL EXPORT CAPACITY AT RICHARD’S BAY

Milestone agreement inked on December 7, 2010 increases
export capacity incrementally by 960,000 tonnes per annum
for a total export capacity of 1,157,000 tonnes in 2013.

SIGNIFICANT OFFTAKE AGREEMENT PROVIDES STEADY
CASH FLOW
Three year offtake agreement reached with global energy trading
company for 1.75 million tonnes (total) of thermal coal

Cash flow from offtake agreement will fund continued ramp up of
production at the two operating mines

15

Mining Resource TSX/JSE : FMC

NI 43 – 101 Global Resource1

Measured Indicated MI Inferred Yearly LOM
ROM2
Magdalena 51.7 m - 51.7 m - 1.0 m + 20 years
Bituminous
Aviemore 1.6 m 34.1 m 35.7 m 15.1 m 0.25 m + 20 years
Anthracite

16

U/G LOM Production Profile 1
TSX/JSE : FMC

2,000,000

1,800,000

1,600,000

1,400,000

1,200,000
Tonnes

1,000,000

800,000

600,000

400,000

200,000

-
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021

Magdalena O/C Magdalena U/G Aviemore U/G

Magdalena2 Aviemore2
• Section 1: ABM30 High Seam, 40,000 tonnes/month • Section 1: Conventional, 22,000 tonnes/month
• Section 2: Conventional Low Seam, 10,000 tonnes/month • Section 2: Conventional, 22,000 tonnes/month
• Section 3: Dyke, 12,000 tonnes/month • Investigate low seam CM’s for future
• Section 4: ABM30 High Seam, 40,000 tonnes/month
• Section 5: CM Low Seam, 25,000 tonnes/month

2. As per management’s guidance.
17

Magdalena Bituminous Coal Operations TSX/JSE : FMC

18

Magdalena Bituminous Coal Operations TSX/JSE : FMC

Magdalena Operations and Site Layout
Asset Summary1

Location: • Dundee, Kwa-Zulu, Natal
Coal Type: • Bituminous
Resource: • 51.7 million tonnes
Acres: • 4,557
Average BTU: • 12,250 BTU/lb
• 6,800 kcal/kg
Ash: • 15.0%
Volatility: • 16.7%
Saleable • 2011FY2: 555,000 tonnes
Production: • 2012FY2: 748,000 tonnes
Mine Life: • Approximately +20 years
Infrastructure: • Wash plant, processing plant
and siding

2. Fiscal year-end February 28
19

Magdalena Bituminous Coal Production Profile TSX/JSE : FMC

• Ramp-up on schedule
• New ABM30 continuous miner arrived in December 2010 (further increased
saleable production capacity by close to 30,000 tonnes per month)1
• Second ABM30 continuous miner scheduled for delivery end September 2011

Magdalena Saleable Bituminous Coal Production2
(000 t)/February 28 year-end
1,003
748

556
449 485
347 326
299

2006 2007 2008 2009 2010 2011 2012 2013E

Magdalena - open pit Magdalena - underground

20

Magdalena Project Area & Mining Rights1 TSX/JSE : FMC


21

Aviemore Anthracite Coal Operations TSX/JSE : FMC

22

Aviemore Anthracite Coal Operations TSX/JSE : FMC

Aviemore Operations
Asset Summary1

Location: • Dundee, Kwa-Zulu, Natal
Coal Type: • Anthracite
Resource: • 35.7 million tonnes
(15.1 million tonnes inferred)

Acres: • 13,818
Average BTU: • 12,800 BTU/lb
• 7,100 kcal/kg
Ash: • 13.7%
Volatility: • 7.9%
Saleable • 2011FY2: 92,000 tonnes
Production: • 2012FY2: 176,000 tonnes
Mine Life: • Approximately +20 years
Infrastructure: • Wash plant, processing plant
and siding
2. Fiscal year-end February 28
23

Aviemore Anthracite Coal Production Profile TSX/JSE : FMC

• Annual production capacity expected to hit 500,000 tonnes of saleable coal
per annum in fiscal 20141

Aviemore Anthracite Coal Saleable Production2
(000 t)/February 28 year-end

420

176
102 92
59 62 61
20

2006 2007 2008 2009 2010 2011 2012 2013E

24

Aviemore Project Area & Mining Rights1 TSX/JSE : FMC


25

Corporate Structure TSX/JSE : FMC

Forbes Coal Ownership Structure

Forbes and Manhattan Coal Corp.
(Ontario, TSX/JSE Listed)

100%

Forbes and Manhattan Coal Inc.
(Ontario)

100%

Slater Coal (Proprietary) Limited
(South Africa)

70%

Zinoju Coal (Proprietary) Limited BEE
(South Africa) 30% (Nulane)

100% 100%

Magdalena Aviemore
Bituminous Coal Anthracite Coal

Source: FM Coal Corp

26

Responsible Development TSX/JSE : FMC

• Good working relationship with its two
unions: National Union of Mineworkers
(NUM) and Amalgamated Mining &
Construction Union (AMCO)
• Labour contracts are negotiated on an
annual basis

• Implementing internationally recognized
safety, health, environmental and quality
management systems

• Adheres to the tenets of the Mining
Charter and promotes local
procurement and procurement from BEE
companies

• Committed to developing local
communities

27

Capitalization and Share Performance TSX/JSE : FMC

Share Structure

Basic Shares Outstanding 34.8 million
FD Shares Outstanding1 39.5 million

Canadian Share Performance South African Share Performance

Company Ticker TSX: FMC Company Ticker JSE: FMC
Closing Price (March 23, 2012) C$1.85 Closing Price (March 23, 2012) ZAR 1,600
Trading Range C$1.22 – $4.04 Trading Range ZAR 1,430 –2,750
(52 week) (since July 28, 2011)
Market Capitalization (Basic) C$64 million Market Capitalization (Basic) ZAR 557 million
Market Capitalization (FD) C$73 million Market Capitalization (FD) ZAR 632 million

1 Includes2,700,000 performance warrants that convert into common shares upon the company reaching certain operating targets. Also includes
3,445,300 options with a weighted average exercise price of C$5.35 per share, 763,887 broker warrants convertible into common shares at an exercise
price of C$2.80 per share and expiring on January 23, 2012 and 480,000 broker warrants convertible into common shares at an exercise price of C$4.55 28
per share and expiring on February 22, 2013.

Peer Group Trading Analysis TSX/JSE : FMC

Share price performance: South African listed peers Relative valuation: South African listed peers

30.0x
200 26.4x

25.0x

20.0x

15.0x 12.4x
10.7x10.4x
150 9.4x
10.0x 8.2x
6.8x 6.5x

5.0x 2.8 x
1.5 x

0.0x
Coal of Africa Keaton Energy Optimum Coal Exxaro Forbes Coal
100 Corp.

Source: Bloomberg FY 12 P/E FY 13 P/E

Sales growth (FY12 to FY13) versus FY12 P/E: South African listed peers
50
140.0%

120.0%

Sales Growth (FY12 to FY13)
Keaton Energy
100.0%

80.0%
0
60.0%

40.0% Forbes Coal
Coal of Africa
Optimum Coal
20.0% Exxaro
Forbes Exxaro Optimum Coal Keaton
Wescoal Hwange Firestone Resgen 0.0%
-5.0 0.0 5.0 10.0 15.0 20.0 25.0 30.0 35.0
-20.0%
FY12 P/E

Source: Bloomberg, 7 March 2012
(1) Excluding Forbes Coal
29

Comparable Trading Analysis TSX/JSE : FMC
Comparable Trading Analysis
• Forbes Coal trades at Market Cap EV EV / EBITDA P/CFPS

a significant discount Company
U.S. Coal Producers
(US$M) (US$M) 2011E 2012E 2011E 2012E

to comparable coal Alliance Resource Partners LP $2,720
$4,947
$3,115
$7,151
5.5x
4.9x
5.0x
4.8x
4.8x
4.0x
4.7x
3.6x
Alpha Natural Resources Inc.
producers on an Arch Coal $3,232 $6,749 6.6x 4.9x 3.6x 3.1x

EV/EBITDA and P/CF Cline Mining Corp.
Cloud Peak Energy Inc.
$448
$1,191
$349
$1,315
NA
3.8x
2.5x
3.7x
NA
4.0x
4.5x
4.4x
basis Consol Energy, Inc.
Corsa Coal Corp.
$8,229
$123
$10,869
$126
6.0x
NA
6.5x
NA
5.4x
6.1x
6.1x
2.4x
James River Coal Co. $246 $573 3.1x 4.9x 1.8x 2.5x
Lipari Energy, Inc. $29 $30 1.8x 1.6x 2.6x 1.7x
Natural Resource Partners LP $2,775 $3,494 10.6x 10.4x 9.8x 10.0x
Oxford Resource Partners, LP $357 $494 8.2x 5.8x NA NA
Patriot Coal Corporation $812 $997 5.6x 6.7x 6.5x 11.1x
Peabody Energy Corp.1 $9,949 $13,957 5.5x 5.8x 5.5x 6.3x
Rhino Resource Partners LP $554 $650 8.2x 6.1x 6.5x 5.9x
Xinergy Ltd. $160 $301 7.4x 4.0x 7.9x 4.1x
Walter Energy, Inc. $4,592 $6,762 6.9x 7.0x 6.6x 6.5x
U.S. Coal Producers Average (excluding high and low) 6.0x 5.2x 5.3x 4.9x
African Coal Producers
Coal of Africa Limited $715 $665 22.3x 4.0x 14.1x 4.9x
Continental Coal Limited $95 $74 14.2x 1.1x 5.7x 1.7x
Exxaro Resources Limited $9,758 $7,705 8.8x 5.4x 10.4x 6.6x
Keaton Energy Holdings Limited $70 $75 NA 5.1x NA NA
Optimum Coal Holdings Limited $1,214 $1,054 6.0x 3.3x 8.2x NA
Petmin Limited $236 $119 2.7x 2.0x 5.3x 4.9x
African Coal Producers Average (excluding high and low) 9.7x 3.6x 8.1x 4.9x
Other Coal Producers
Gloucester Coal Ltd.2 $1,415 $1,599 11.5x 9.6x 10.1x 10.2x
Grande Cache Coal Corporation3 $580 $634 4.7x 3.6x 5.5x 3.0x
Whitehaven Coal Limited4 $5,720 $5,564 23.7x 16.1x 18.5x 11.8x
Other Coal Producers Average 13.3x 9.8x 11.4x 8.3x
Overall Average (excluding high and low) 7.6x 5.1x 6.6x 5.3x
5
Forbes Coal (C$) $71 $83 2.6x 2.0x 3.9x 2.4x
Forbes Coal - Discount to Comparables (65%) (60%) (42%) (55%)
Note: As of February 8, 2012
1. Peabody Energy Corp. is shown pro forma the acquisition of Macarthur Coal Ltd.
2. Gloucester Coal Ltd. is shown pre-announcement of the pending acquisition by Yanzhou Coal Mining Co. Ltd. that was announced on December 22, 2011
3. Grande Cache Coal Corporation is shown pre-announcement of the pending acquisition by Winsway Coking Coal Holdings Limited and Marubeni Corporation that was announced on October
31, 2011
4. Whitehaven Coal Limited is shown pro-forma the pending acquisition of Aston Resources Limited and Boardwalk Resources
5. Forbes Coal’s operating forecast is based on Canaccord Genuity Research estimates. Market cap and EV includes 2.7 million performance warrants
30
Source: Consensus estimates and company reports

Analyst Coverage TSX/JSE : FMC

Analyst Target Price (C$)

Gary Lampard
$3.60
Canaccord Genuity
David Charles
$4.70
GMP Securities
Wojtek Novak
$3.50
Fraser Mackenzie
Tania Maciver
$5.30
Northland Capital Partners
Santo Ranieri
$5.00
Paradigm
Mark Ingham
$7.28
Ingham Analytics
Shihepo Kavambi
$2.78
Imara

31

Summary TSX/JSE : FMC

 Currently producing high quality bituminous and anthracite coal

 Plans to organically TRIPLE production from 2010 historic levels to 1.5 million
saleable tonnes per annum in three years

 Export capacity at Richards Bay Coal Terminal and Grindrod Terminals Richards
Bay to increase incrementally to 1,157,000 tonnes per annum by 2013

 Offtake agreement with global energy trading company provides cash to fund
ramp up at two operating mines

 Growing demand for coal from emerging markets

 Looking at strategic acquisition opportunities in the region

 Strong balance sheet and coal-focused management team

32

TSX/JSE : FMC

Appendix

33

South Africa – Overview TSX/JSE : FMC

• South Africa is the most attractive country in
Africa in which to do business according to
Richard’s Bay Port
Ernst & Young 2011 Africa Attractiveness World’s Largest Coal Terminal
Survey

• Modern infrastructure system supporting
distribution of commodities for both domestic
and export markets
– Extensive rail network (10th longest in
the world)
– Majority of electricity generated via
coal fired power stations
– Richard’s Bay port in South Africa is the
world’s largest bulk coal terminal
• 91 million tonne capacity
• Coal railed from approximately
49 mines

• Long history in resource development
– World’s largest PGM & ferrochrome
producer
– Significant coal, iron ore and
manganese resources

34

Historical Coal Prices TSX/JSE : FMC

• South African thermal coal (Richard’s Bay terminal) and coking coal prices have increased significantly
over the last several months

• The recovery to 2008 levels have been driven by increased demand, particularly from China and India,
and higher cost supply from key producing nations such as Russia and the U.S.

Historical South African Thermal Coal and PCI Coal Prices
$300

$250

$200
(US$ /tonne)

$150

$100

$50

$0
Jan-07

Jul-07

Jan-08

Jul-08

Jan-09

Jul-09

Jan-10

Jul-10

Jan-11
Mar-07

May-07

Sep-07

May-08
Nov-07

Mar-08

Sep-08

May-09
Nov-08

Mar-09

Sep-09

Nov-09

Mar-10

May-10

Sep-10

Nov-10
Richards Bay Thermal Coal Spot Price McCloskey/Xinhua Infolink's Coking Coal Price

Source: Bloomberg
35

Thermal Coal Global Overview TSX/JSE : FMC

• Significant upside potential to
export prices Global Thermal Demand and Supply Forecast

• A tightening of the global
seaborne market in late 2010
provided the initial base for
thermal coal to rise

• Robust import demand from India

• Growing imports into China due to
increasing demand and
production curtailments

• Slowing export supply growth from
Indonesia as more coal is diverted
for domestic use

• Short-term supply constraints
caused by flooding in Australia

• Australia is the second-largest
exporter of bituminous coal

• Wood Mackenzie stated that
prices could exceed 2008 highs

Source GTIS, Macquarie Research, February 2011
36


• India will be relying heavily on coal fired power plants in the near future

37


• As a result of reliance on thermal power generation, Indian thermal
imports are expected to rise significantly

38


• Chinese thermal coal imports have been huge; this trend is expected to
continue into near future

39

Metallurgical Coal Global Overview TSX/JSE : FMC

• The coking coal market was
fundamentally tight prior to the Global Thermal Demand and Supply Forecast
Queensland floods, which have
further constrained the market

• Current situation highlights the
lack of geographical diversity to
supply side portfolio, leaving it
prone to shocks

• Market deficit likely to prevail,
keeping price at decent premium
to cost support

• Requirement for projects in high
geopolitical and infrastructure risk
regions will keep long-term prices
elevated

40


• Many metallurgical coal basins exist, however there is a challenge in
bringing new projects online

41


• Supply growth in 2011 is set to be much lower than in 2010, while key
regions increase demand

42


• Global anthracite coal demand driven by the metal refining industry
– Cost-effective replacement for coking coal/coke
• Emerging markets consuming the most steel
• China is the world largest steel producer
– Accounts for 44% of global steel production
– Expected to sustain steel consumption growth of 6%-8% annually
• China accounts for 52% of the world’s coking coal consumption
– Imports more than half of coking coal consumed from export markets

Increasing steel
production and
consumption
drives demand
for anthracite
coal

Global steel consumption: Macquarie Commodities Research February 2011
43

TSX/JSE : FMC March 2012

CONTACT INFORMATION

Stephan Theron Sabina Srubiski
President & CEO Investor Relations Manager
Forbes & Manhattan Coal Corp. Forbes & Manhattan Coal Corp.

Tel: + 1 416 861 5912 Tel: + 1 416 309 2957

info@forbescoal.com ssrubiski@forbescoal.com
www.forbescoal.com www.forbescoal.com

65 Queen Street West, Suite 815 P.O. Box 71, Toronto, Ontario, Canada, M5H 2M5 44

Fmc corporate presentation mar 2012

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