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1 INDONESIAN COAL PRODUCTION & EXPLORATION October 2011 Hong Kong Investor Marketing 1

2 DISCLAIMER Certain statements contained in this presentation, including information as to the future financial or operating performance of Orpheus Energy Limited ( Orpheus ) and Orpheus Energy Group Pty Ltd ( OEGPL ) and its projects, are forward looking statements. Such forward looking statements may include, among other things, statements regarding targets, estimates and assumptions in respect of mineral reserves and mineral resources and anticipated grades and recovery rates, production and prices, operating costs and results, capital expenditures, and are or may be based on assumptions and estimates related to future technical, economic, market, political, social and other conditions; are necessarily based upon a number of estimates and assumptions that, while considered reasonable by Orpheus/OEGPL, are inherently subject to significant technical, business, economic, competitive, political and social uncertainties and contingencies; and involve known and unknown risks and uncertainties that could cause actual events or results to differ materially from estimated or anticipated events or results reflected in such forward looking statements. Orpheus/OEGPL disclaims any intent or obligation to update publicly any forward looking statements, whether as a result of new information, future events or results or otherwise. The words believe, expect, anticipate, indicate, contemplate, target, plan, intends, continue, budget, estimate, may, will, schedule and similar expressions identify forward looking statements. All forward looking statements made in this presentation are qualified by the foregoing cautionary statements. Investors are cautioned that forward looking statements are not guarantees of future performance and accordingly investors are cautioned not to put undue reliance on forward looking statements due to the inherent uncertainty therein. Competent Person s Statement: The following statements apply in respect of the information in this announcement that relates to mineral resources, exploration results and exploration targets. The information is based on, and accurately reflects information compiled by Wes Harder, who is a Member of the Australasian Institute of Mining and Metallurgy. Wes Harder is a Director of Orpheus Energy Limited and is a Geologist who has sufficient experience which is relevant to the style of coal mineralisation and type of deposit under discussion and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves". Wes Harder consents to the inclusion in the report of the material, based on his information, in the form and context in which it appears. * JORC- Exploration Target It is common practice for a company to comment and discuss its exploration in terms of target and size type. The information in this presentation relating to exploration targets should not be misunderstood or misconstrued as an estimate of Mineral Resources or Ore Reserves. The potential quantity and grade is conceptual nature, there has been insufficient work completed to define a mineral resource and it is uncertain if further exploration will result in the determination of a mineral resource. 2

3 EXECUTIVE SUMMARY Orpheus Energy Limited ( OEG ) is a coal company focusing on coal production and exploration in Indonesia. OEG also owns some Australian coal and industrial minerals projects. Orpheus has signed a strategic alliance with PT Mega Coal International ( Mega ) which is an existing coal producer and exporter. ASX Code OEG Proforma Shareholding Structure (Immediately Post In Specie Distribution by Coalworks) Shares on issue ~115M Options ~53M Share price $0.15 Market capitalisation* ~$25m Cash $6m * Fully diluted basis 3

4 WHY INDONESIA? Indonesia is a key player riding on the strong and growing export coal market China s Import from Indonesia and Australia (Source: Bloomberg, CIMB Research) India s Import trend with Indonesia as a key supplier Indonesia and Australia remains the key players in the export coal market. Indonesia has been the fastest growing exporter, overtaking Australia as the largest supplier to the global seaborne market in China plans to add 1TW new coal-fired power plants by the end of 2020, triple the size of its total capacity from the current 650GW. Demand visibility from India is also strong as the country plans to add 130GW of power plants over the next five years. As its import data shows, India is even more relevant to Indonesia s exports since its imports from Indonesia account for around 65% of its total coal imports. The trend should only continue as India s requirement for more low-cv coal fits with the output outlook from Indonesian producers. (Source: CIMB Research) 4

5 2012 PE Multiples Australia average = 13.3X Indonesia average = 8.4X 0 50% 45% 40% 35% 30% 25% 20% 15% 10% 5% 0% Borneo Bumi Adaro Indika ITM Berau PTBA HRUM PT Bonreo Straits Asia Coal & Allied Gloucestor Macarthur Whitehaven For personal use only WHY INDONESIA? Attractive Valuation Compared to Australian Coal Companies Indonesian coal companies are priced at an attractive discount of 36% compared to their Australian peers (Source: Bloomberg, 15 September 2011) Better Operating Margin compared to Australian coal companies PTBA Adaro 2011 EBITDA Margin Bumi (Source: Bloomberg, 15 September 2011) Hrum Indonesian Margins=36% Straits Asia Australian Margin=30% ITM Gloucestor Coal & Allied Whitehaven Macarthur Due to lower cost of production, Indonesian coal companies have better operating margins compared to their Australian peers. The lower cost of production will provide additional buffer against coal price fluctuation, more so in view of the current volatile market condition. 5

6 CORPORATE STRATEGY Near term objective To move Orpheus s first Indonesian coking and thermal coal production asset, the B26 project (Orpheus 51%), into highly profitable steady state mining at a production rate of 40,000 tonnes per month (~500,000 tonnes per year) from Trial mining has been underway in 2011 and a new mine plan is nearly complete for the next stage. Medium term objectives To consolidate Orpheus s profitable mining at B26 and move the B34 project in the neighbouring area into production, doubling total production out of this area. To add near-term production assets to Orpheus s portfolio. B34 was secured in September 2011 and further projects are under review by Orpheus, as part of the OEG Mega Coal strategic alliance in South Kalimantan for acquisition and development. Longer Term Objective To establish Orpheus as a high volume, highly profitable coking and thermal coal producer, infrastructure owner and coal trader in Indonesia. 6

7 ORPHEUS BOARD & MANAGEMENT WAYNE MITCHELL A. A. S. A. - Executive Chairman & CEO Mr. Wayne Mitchell is a qualified accountant with over 30 years extensive senior management experience in the natural resource sector; both in Australia and in South East Asia. In the early 1970's, Mr. Mitchell and two partners were the initial promoters and developers of Thailand's major zinc deposit located at Mae Sot, Northern Thailand. Mr. Mitchell specializes in the areas of financial planning, fund raising and project evaluation. He is also a past Chairman of listed company Central Victorian Gold Mines N.L and a director of Diversified Mineral Resources NL where he initiated and led the project team for the Burton Downs Coal project taken over by Portman Mining before being sold for more than $200 million. Mr. Mitchell is a co- founder and chairman of Coalworks Limited. DAVID SMITH B Econ, Dip Mgmt - Executive MBA. - Executive Director Mr Smith is an investment banker of 15 years experience, and was most recently at BBY Limited where he was Head Equity Capital Markets and a member of the group's Executive and Risk Management Committee. Mr Smith joined BBY in 2004 and since that time, BBY's Corporate Finance division raised more than $4 billion for its corporate clients and now maintains regular Top 15 positions in the various Australian Investment Banking League Tables. He has extensively advised corporate clients in the bulk commodities sectors of coal and iron ore. In 2008, the BBY Corporate Finance division won the "Best Corporate Deal of the Year" award at the Australian Stockbrokers Foundation Awards for a coal sector client. Mr Smith maintained a Top 10 ranking in the annual SMH Age East Coles Investment Banking surveys from Prior to joining BBY, he worked at Ord Minnett and then JPMorgan Chase. WESLEY HARDER BSc. Dip SIA. MAusIMM. - Director, Exploration Mr. Harder is a former coal analyst with Jackson Ltd stockbrokers and has also worked with a number of stockbrokers, including Ord Minnett and Frank Renouf. He has also worked as a field exploration geologist for fifteen years in Australia and its near neighbours including Sumatra and Irian Jaya in Indonesia, mainland Papua New Guinea and New Britain Island, many parts of the Solomon Islands and Fiji. He has worked in tropical and arid environments searching for a range of mineral commodities including gold, copper, coal and uranium for such major companies as Newmont Mining Inc., Placer Prospecting Ltd and Pancontinental Mining Limited and Gujarat NRE Coking Coal Ltd. He was a Founding Director & CEO of Zinico Resources NL and its successors for 5 years and Mr. Harder is a founding shareholder of Coalworks Ltd. TONY. KING, BSc. BA. - Director Mr King is a professional Metallurgist and qualified geologist with over 20 years operational and technical experience within the resource industry. He has held senior positions as Company Chemist for Ardlethan Tin, Gold Copper Exploration Pty Ltd and Great Northern Mining Corporation Ltd. Mr King is a former director of Allegiance Mining NL where he was General Manager Operations. He has also been involved in design and construction of coal washing plants and has participated in a wide variety of resource projects. 7

8 ORPHEUS BOARD & MANAGEMENT DAVID OASTLER Bcom. CA. - Chief Financial Officer David is a Chartered Accountant with over 25 years experience with various SME s, listed and private company groups as well as services to various governmental agencies. David is also CFO of Coalworks Limited. NATHAN BARTROP LLB, B Com, ACIS Company Secretary Mr Bartrop is a Chartered Secretary and associate member of Chartered Secretaries Australia. His previous role was as Assistant Company Secretary at Mirabela Nickel Limited, a nickel producer in Brazil. Prior to this, he worked at ASX for 2 years as a Listings Adviser in Perth which involved the provision of interpretation and advice to existing and prospective listed entities and their advisers, in relation to the application of the ASX Listing Rules. Mr Bartrop also has previous experience working in litigation and dispute resolution, as well as tax consulting and has a Bachelor of Laws & Bachelor of Commerce from the University of Western Australia. CHRISTOPHER HAGAN, BA. LLB - Senior Advisor and Solicitor Mr Hagan founded his own law firm in Following his appointment as a director of, Diversified Mineral Resources NL, Mr Hagan participated in the project development of the $200 million Burton Downs Coal Project in Queensland which was taken over by Portman Mining (Cleveland Cliffs). Mr Hagan has also founded public listed companies, Allegiance Mining NL and Zelos Resources NL (now part of Gujarat NRE Coking Coal Ltd) and Coalworks Limited. 8

9 ORPHEUS MANAGEMENT JAKARTA OFFICE THOMAS NIETSCH - Marketing Manager Jakarta Office Mr Nietsch has worked in the coal and energy business for over 30 years, including companies such as Stinnes, Thyssen and Atel. From 2004 to 2007, Mr Nietsch also worked in Indonesia for reputable coal trading houses. Between he was a ship broker and coal adviser for Voegmann Gmb of Hamburg. Mr Nietsch joined OEGPL in February RUDI HASAN PUTRA Senior Geologist Jakarta Office Mr Putra has a Bachelor Degree in Geological Engineering, Faculty of Mineral Technology, Trisakti University, Jakarta. Mr. Hasan has more than 15 years experience in the Indonesian Mining Industry. Mr. Hasan worked from 1994 to 2011 as Geologist for various mining companies in Indonesia. Mr. Putra joined OPL in June HALLY PONG LANTERA TULILI - Mining Engineer Jakarta Office Mr. Tulili has a Diploma in Mining Engineering from the University of Samarinda, East Kalimantan. Mr. Tulili worked from 2005 until 2011 for various mining companies in Kalimantan. Mr. Tulili joined OPL in September ARDIANSYAH AHMAD SITUMORANG Accountant Jakarta Office Mr. Situmorang has studied Economics and Business Administration in Jakarta. He worked from 2004 to 2009 for the Singapore International School, Jakarta, as Finance and Accounting Supervisor. From 2010 to October 2011 he is working for Putera Sampoerna Foundation as Accountant. Mr. Situmorang will join OPL in October

10 PT MEGA COAL INTERNATIONAL Founded in 2005, and is a privately-held coal mining company with an extensive local network and mining experience. Key Management: Ir Nugroho Suksmanto (Chairman & CEO) and Mike Rhodes (President-Director). Operates a coal mine called Alam Duta in South Kalimantan with projected production rate of 500,000 tonnes p.a. A joint venture partner in the Oorja Coal Mine in East Kalimantan, which has been in operation for 3 years and according to PT Mega Coal International produces 80,000 tonnes per month. Holder of a number of exploration & mining concessions in Kalimantan. JV partners in B26 and B34, with Orpheus entitled to 51% equity share. Strategic Alliance with Orpheus for exploration & development of further concessions and infrastructure assets in Indonesia. 10

11 ORPHEUS S FIRST INDONESIAN ASSETS The first project in place in partnership with Mega - B26, comprising two tenements, B2 and B6, which are located in East Kalimantan. There are additional Indonesian coal projects and infrastructure opportunities currently being evaluated under the strategic alliance. Block 2 & 6 B26 is a 51/49 joint venture which compromises two tenements Block 2 and Block 6 with a total exploration target of 2.8Mt to 4.5Mt* of high grade thermal coal with some coking coal potential. Block 2 has already had trial mining in 2011 and the next stage mine plan is currently being developed by Minarco Mine Consult. Block 2 has a short term target production rate of ~500,000 tonnes per year 11

12 ORPHEUS S FIRST INDONESIAN ASSETS Block 3 & 4 B34 is OEG s second Kalimantan 51/49 JV project which compromises two tenements Block 3 (4,775ha) and Block 4 (3,126ha) with a total exploration target of 5-10Mt and calorific value of 7200 to 8100 Kcal/kg*. B34 is located ~60km west of B26 and it is ultimately planned to be mined using the same road/port infrastructure. Drilling program is planned for January 2012 to establish a JORC resource. B34 has had historical geological mapping and reported the following high quality coal samples: B3: low ash (1.5%); low total moisture (8.3% ar); energy content of 7,123Kcal/kg. B4: low ash (1.9%); low total moisture (6.5% ar); energy content of 7,235Kcal/kg. Following conversion of B34 Exploration KPs into Exploitation IUPs, scheduled for Q2 2012, mining from B34 will eventually double OEG s total production out of the area. 12

13 B26 PROJECT OVERVIEW B2 and B6 project is located in central-east Kalimantan approximately 100km from Balikpapan. Commenced trial mining at B2 in Jan 2011 with several shipments of coal taking place earlier this year Orpheus assumed operational management of the B2 project on 1 September Minarco Mine Consult has been appointed to work with management in finalizing the new Mine Plan for the next stage of production and for the life of mine. Resource Block 2 and 6 Total exploration target resource of 2.8Mt - 4.5Mt: Block 2 JORC resource of 1.13Mt. Additional drilling has been completed, with a current exploration target of 1.3Mt to 2.0Mt*. Awaiting results. Block 6 Current exploration target of 1.5Mt to 2.5Mt*, and has recently undergone a substantial drilling program of over 30 drill holes to establish a JORC resource. Awaiting results. Infrastructure B26 port allocation has been secured which includes a conveyor and jetty. The truck distance from the B2 mine to the barge is approximately 27km. Haul road improvements to facilitate streamlined truck movements to the barge loader are almost complete. Title Baker & McKenzie has provided independent legal verification of B26 tenement s ownership for Orpheus and Mega. 13

14 B26 PROJECT OVERVIEW The key target features of the B2 short term mining production plan include: Initial target production of ~750,000 tonnes to be outlined in mining plan under preparation by Minarco Mine Consult. (Refer to Ravensgate Independent Geologist s Report dated May 2011 in the Orpheus Prospectus for further information regarding the B2 resource). B2 project port allocation has been secured ~27km away near Tampang village. Target production rate of 40,000 tonnes per month (~500,000 tonnes per annum). Target semi-soft coking/thermal coal production split of 15%/85%. Target Operating Costs of ~$45 per tonne including transport, royalties and barge loader costs. Sales offtake agreement currently being negotiated to reflect current prices. 14

15 B26 COAL TRANSPORT Block 2 Coal is transported in trucks along a haul road approximately 27km from the B2 mine site. This barge is located approximately 2km from Tampang village, East Kalimantan. These barges then travel out into the trans-shipment area in Adang Bay. The coal is then transferred from the barge onto Handimax ships. Source: Prepared by Orpheus. Not drawn to scale. 15

16 COAL PRODUCTION IN BLOCK 2 Overburden removal (Source: PT Tunis Bumi Menggala (mining contractor), November 2010) 16

17 COAL PRODUCTION IN BLOCK 2 (Cont d) Open pits in B2 (Source: Orpheus, January 2011) 17

18 COAL PRODUCTION IN BLOCK 2 (Cont d) Coal getting in Pit 4 at Block 2 (Source: Orpheus, January 2011) 18

19 CONVEYOR & LOADING JETTY NEAR BLOCK 2 Conveyor and loading jetty located approximately 27km from Block 2 (Source: Orpheus, January 2011) 19

20 SUMMARY OF B26 COAL QUALITY Resource Category Summary of the B26 Coal Resource by JORC Classification Block 2 Indicated Block 2 Inferred Total Density Average Thickness ~ m ~ m ~ m Tonnes (million) Total Moisture (ar)% Ash (adb)% Volatile Matter (adb)% Fixed Carbon (adb)% Total Sulphur (adb)% Gross Calorific Value (adb)% 6,520 7,080 6,600 B26 Coal Exploration Target by Tenement License Target (Mt) Comment Block Not inclusive of the JORC resource of 1.13mil tonnes. Block Awaiting 2011 coal drilling results. Total B26. Average CV range 5,950 to 7,100 kcal/kg (adb). 20

21 B2 COAL QUALITY No Laboratory Client Mass Sample Block 2 Stockpile and Pit Coal Quality Assays Grab Samples Sampl e Air Drying Residual Total Moisture in the Analysis Received Loss Moisture Moisture sample Ash Volatile Fixed Total Calorific Calorific Relative Crucibl e Matter Carbon Sulphur Value Value Density Swelling ID No. ID Kcal/g Kcal/g HGI No. 1 KT.00744/11 2 KT.00744/11 3 KT.00745/11 SP No.1 SP No.2 SP No.3 (gr) % % % % % % % % ar adb ar Adb Adb Adb Adb Adb Daf 2, , , KT.13449/10 Pit 1 28, KT.13450/10 Pit 2 28, KT.00242/11 Pit 3 5, KT.00243/11 Pit 4 7, KT.00244/11 SP No.2 3, Total (Source: Ravensgate, March 2011) 21

22 B6 COAL QUALITY No Coal Quality Sample Assays for Block 6 Laboratory Client Mass Air Drying Residual Total Moisture in the Ash Volatile Fixed Total Calorific Calorific Relative Crucible Analysis Sample Sample Received Loss Moisture Moisture Matter Carbon Sulphur Value Value Density Swelling sample ID No. ID % Kcal/g Kcal/g HGI No. % % % adb % % % % (gr) ar adb ar Adb Adb Adb Adb db Daf 1 KT.9013/07 BBA19-S1 4, KT.9014/07 BBA19-S2 4, KT.11650/07 KP6-25 C S1 4 KT.11651/07 KP6-25 C S2 5 KT.11652/07 KP6-17 C - S1 6 KT.11653/07 KP6-17 C - S2 7, , , , KT.15963/07 8 KT.15964/07 9 KT.15965/07 10 KT.15966/07 KP6-01 AC (S1&S2) KP6-07 AC (S1&S2) KP6-25 AC S1 KP6-27 C (S1&S2) 1, KT.15967/ Total (Source: Ravensgate, March 2011) 22

23 B26 TIMETABLE CY2011 CY2012 B2 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Funding Finalised Capital Expenditure Drilling Upgrade to mine status/jorc Commencement of Trial Mining Mine Design Finalised Commencement of Phase 2 Trial Mining B6 Drilling Mine design Finalised Conversion to Exploitation KP Appointment of Mining Contractor Commencement of Trial Mining First Trial Shipment 23

24 ADDITIONAL INDONESIAN PROJECTS Orpheus has progressed plans to expand the Strategic Alliance with PT Mega Coal International for the new acquisition phase of the Strategic Alliance. A number of projects have been identified for possible acquisition under the strategic alliance located in the Kintap and Tapin areas of South Kalimantan and in East Kalimantan which all have good infrastructure including good proximity to barge loaders or appropriate port sites and transport options. The framework has been developed to allow completion of the following activities: Technical review of each project; Memorandum of Understanding with each owner; Term Sheet for Orpheus Participation; and Completion of legal due diligence. 24

25 AUSTRALIAN PROJECTS Hodgson Vale Project is located in SE Queensland in proximity to other producing coal mines. Past drilling shows coal measures exist in the EPC with medium grade export quality coal potential. Drilling is planned in Q to explore for coal in the southern zone of EPC Ashford Past drilling shows potential for chemical grade Ground Calcium Carbonate (GCC). Orpheus proposes to outline zones of high quality limestone suitable for GCC through a drilling program in Q A high quality (white rating index of over 91%) exploration target 30-40Mt* of ground calcium carbonate exist in EL6511 Wingen Project lies just north of Unimin s operating bentonite mine. Past work show potential for high quality bentonite Orpheus s joint venture partner has previously located outcropping bentonite on EL7142 Existing granted EL7124 has been extended by ELA 3657 which upon grant will enable a drilling program to commences in Q

26 INVESTMENT HIGHLIGHTS Trial coal production has commenced at B26. Orpheus has secured its second Indonesian coal project, B34. Strong Indonesian partner, PT Mega Coal International, providing for future Indonesian JV coal projects/infrastructure opportunities. Experienced management. Strong global demand for export quality coking and thermal coal. Attractive project financial economics. Undervalued compared to Indonesian peers. 26

27 ENQUIRY AND CONTACT Orpheus Energy Limited (ASX Code: OEG) Level 5 44 Miller Street NORTH SYDNEY 2060 Phone Fax Wayne Mitchell wmitchell@orpheusenergy.com.au Mobile No David Smith: dsmith@orpheusenergy.com.au Mobile No