Tiaro Coal Limited : $3.6M Funding For Paragon Metallurgical Coal Project

ASX Announcement

12th November 2013

$3.6M FUNDING FOR PARAGON METALLURGICAL COAL PROJECT

• China Qinfa Group commits further $3.6 million

• Funds to be used to advance exploration and project assessment

• Likely extensions of the T9 West coal sequence to be tested

• Initial Mine Plan completed 1

• Baseline environmental assessment commenced

Paragon Coal Pty Ltd (Paragon Coal) owns EPC 956 and EPC 957 in the Maryborough Basin in South East Queensland. The Project is centred on the T9 West Resource area located within the northern portion of EPC

956 (see Figure 1). Tiaro has previously announced an

87Mt JORC Resource in T9 West (ASX Announcement of 7

May 2013) 2.

China Qinfa Group (Qinfa) has agreed, through a formal

Share Subscription Agreement, to provide a further

$3.6M funding for Paragon Coal. Payment will be made through a series of investment tranches with an initial tranche of $1M already transacted. The balance of the funds are scheduled to be paid prior to the end of December 2013.

This investment follows the JORC compliant Resource upgrade to 87 million tonnes in the T9 West area, (announced on 7th May 2013 2) and a further Exploration Target of 200-300Mt in the greater T9 - Shady Camp area (announced on 9th May 2013 3).

When completed, the funding will lift Qinfa's ownership in

Paragon Coal to 40.5% with Tiaro Coal Limited (Tiaro) and

ICP Ltd (IPC) interests 47.6% and 11.9% respectively.

Qinfa also holds a 19.88% interest in Tiaro.

Jacob Rebek, director and chief geologist stated,

"Queensland is and will continue to be the largest metallurgical coal exporter and Paragon's project is one of the small number of new metallurgical coal projects in Queensland.

Due to the favourable location in respect of transport and other infrastructure, Paragon's project may be among the first new metallurgical coal projects to commence production".

Exploration Target:

The estimates of potential coal quantity and quality are based on assessment of exploration data gathered to date but remain conceptual in nature. At this stage, there has been insufficient exploration to estimate a further JORC Resource, and it is uncertain if further exploration will result in the estimation of major additions to the existing T9 West 87MT JORC Resource.

NOTES:

1. "Paragon Metallurgical Coal Project" ASX announcement 25th October 2013

2. "Updated JORC Resource of 87Mt for T9 West" ASX announcement of 7th May 2013

3. "Exploration Strategy for T9-Shady Camp" ASX announcement of 9th May 2013

Level 2, 131 Macquarie Street Telephone [phone]
Sydney NSW 2000 Australia Facsimile [phone] www.tiarocoal.com.au

INVESTMENT IN PARAGON COAL

In November 2012 Paragon Coal gained initial funding through investments by ICP, a company listed on the Singapore Exchange Securities Trading Limited, and Qinfa, a company listed on the Hong Kong Stock Exchange.

Tiaro continues to manage and operate the project on behalf of Paragon Coal.

FURTHER EXLORATION AND ASSESSMENT

Paragon has identified additional coal surrounding the T9 West area and within EPCs 956 & 957, but this coal has not been considered in the Initial Mine Plan. Exploration to test likely extensions of the T9 West coal sequence into these adjacent Priority Target areas, north and south of T9 West JORC Resource is currently being planned (see Figure 2). (As detailed in ASX announcement of 9th May 2013 3).

TIARO'S BUSINESS OBJECTIVES

MARYBOROUGH COAL BASIN
To undertake exploration for coal deposits with the potential to produce metallurgical (coking, PCI) and thermal coal.
• Well-positioned coal tenements in the Wide Bay - Burnett region of SE Queensland.
• Two Coal Measures in Maryborough Coal Basin:

o Tiaro Coal Measures

o Burrum Coal Measures

• Large exploration area with 9 granted tenements - 2,013 km2; and 3 tenements - 930 km2 under application
To develop coal mining operations
• Key activities will be:

o Coal mine investment / development in partnership with coal end users, infrastructure developers and logistics managers

o Coal mine management

o Coal production, logistics management and market placement

Position Tiaro as a coal exploration mine development company, working with shareholders and partners on coal projects in the Maryborough Basin
• Paragon Coal is the first such partnership, developing Tiaro's initial coal project
BUSINESS COLLABORATION
Paragon Coal (Tiaro 66.7%) established to explore and develop resources within EPCs 956 & EPC 957
• 87 Mt JORC Coal Resource on T9 West (See JORC Compliance Statements)
• Conceptual in nature Exploration Target 200 - 300 million tonnes in Tiaro Coal Measures (See JORC Compliance Statements)
• Metallurgical (Coking & PCI) coals
CM Basin Holdings Limited (Tiaro 55%) holds 20% interest in the Anggana Coal Project in East Kalimantan, Indonesia
• Anggana Coal Project includes an established thermal coal mine (Bara Naga open cut) and three further nearby coal concessions
• The CMH investment intended to generate dividends to Tiaro which are to be employed in Maryborough Coal
Basin exploration and project development
DIVESTMENTS
Galilee Basin
• 29.2% indirect interest in the Clyde Park Project with Guildford Coal Limited (ASX: GUF)
• 677Mt Inferred JORC Resource (See JORC Compliance Statements)
Clarence - Moreton Basin
• 55% Interest in Clarence-Moreton Basin Project with CM Basin Coal Holdings Limited
West of Blair Athol & Clermont coal mines
• 50% interest in EPC 1262

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COMPETENT PERSON / JORC COMPLIANCE

Paragon Coal Exploration Programs and Exploration Targets
The potential quantity and grade of exploration targets is conceptual in nature. Other than the declared JORC Resources, there has been insufficient exploration to define a further Mineral Resource and it is uncertain if further exploration will result in the determination of further Mineral Resources.
Technical information in this report that relates to Exploration Programs and Exploration Targets is based on information compiled by Jacob Rebek who is a member of Australian Institute of Mining and Metallurgy. Mr. Rebek is a qualified geologist and is a director of Tiaro Coal Limited. Mr Rebek has sufficient experience, which is relevant to the style of mineralisation and type of deposit under consideration 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' (The 2004 JORC Code). Mr Rebek consents to the inclusion in the report of the matters based on information in the form and context in which it appears
T9 West JORC Resource
Please refer to ASX announcement by Tiaro Coal Limited dated 7 May 2013.
Galilee Basin Project
Please refer to ASX announcement by Guildford Coal Limited (ASX: GUF) dated 18 February 2013.

For further information please contact: Dan Buckley - Managing Director Telephone: [phone]

Henry Kinstlinger - Investor Relations

Telephone: [phone]

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