Source: Eurasia Capital                     Date: 03 June, 2011

Prophecy Resources plans to use only “clean” coal in its Chandgana power plant, according to Mr. David Jan, CFO. Chandgana’s location, between Ulaanbaatar and Beijing, makes it eminently suitable to supply electricity to both Mongolia and Beijing. The company is sure China will be interested as buying electricity from Mongolia will gain it carbon credits. The benefit of the project for Mongolia would lie in the use of coal to create a value added product. The power plant will have an initial capacity of 600 mw but the plan is to ultimately generate 4,200 mw. Chandgana is just 60 km from Mongolia's existing power grid and its output can be quickly integrated to the Mongolian system, putting an end to costly power import from Russia.

Construction is expected to begin in the 1Q2013. International banks have shown interest in financing the project, and Monnis has invested in the company’s operations in Mongolia. Prophecy is looking for Asian-listing to raise more capital.