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Permitting in Mongolia

MongoliaSeptember 2011

The information contained in this presentation (“Presentation”) has been prepared by Prophecy Resources Corp. (“Company”) and is being communicated for generalbackground informational purposes only. The Presentation has not been independently verified and the information contained within is subject to updating, completion, revision,verification and further amendment. Neither the Company, nor its shareholders, directors, officers, agents, employees, or advisors give, has given or has authority to give, anyrepresentations or warranties (express or implied) as to, or in relation to, the accuracy, reliability or completeness of the information in this Presentation, or any revision thereof,or of any other written or oral information made or to be made available to any interested party or its advisers (all such information being referred to as “Information”) andliability therefore is expressly disclaimed. Information contained in this Presentation is the property of the Company. It is made available strictly for the purposes referred toabove. Neither the communication of this Presentation nor any part of its contents is to be taken as any form of commitment on the part of the Company to proceed with anytransaction. This Presentation does not constitute, or form part of, any offer or invitation to sell or issue, or any solicitation of any offer to subscribe for or purchase any securitiesin the Company, nor shall it, or the fact of its communication, form the basis of, or be relied upon in connection with, or act as any inducement to enter into, any contract orcommitment whatsoever with respect to such securities. The communication of this Presentation in or to persons in certain jurisdictions may be restricted by law and personswho may rceive communication of this Presentation should inform themselves about, and observe, any such restrictions in advance of communication to them of this Presentation.In particular, this Presentation has not been approved by an authorised person pursuant to Section 21 of the Financial Services and Markets Act 2000 (“FSMA”) and accordinglyit is being delivered in the United Kingdom only to persons to whom this Presentation may be delivered without contravening the financial promotion prohibition in Section 21 ofthe FSMA. Those persons are described in the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (“Order”) and include persons who have professionalexperience in matters relating to investments and who fall within the category of person set out in Article 19 (investment professionals) of the Order. In addition, other than alimited number of persons reasonably believed to be qualified institutional buyers (as defined in Rule 144A under the US Securities Act of 1933, as amended) or accredited

investors (as defined in the National Instrument 45/106), neither this Presentation nor any copy of its may be transmitted into the United States of America or Canada ordistributed directly or indirectly, in the United States of America or Canada, or to any resident thereof except in compliance with the applicable securities laws. Any failure tocomply with these restrictions may constitute a violation of applicable US or Canadian securities laws. By accepting communication of this Presentation, the recipient representsand warrants that it is a person to whom this Presentation may be communicated without a violation of the laws of any relevant jurisdiction. This Presentation is not to becommunicated to any other person or used for any other purpose and any other person who receives communication of this Presentation should not rely or act upon it. Infurnishing this Presentation, the Company does not undertake or agree to any obligation to provide the attendee with access to any additional information or to update thisPresentation or to correct any inaccuracies in, or omissions from, this Presentation that may become apparent either during, or at any time after this Presentation. ThisPresentation contains or incorporates by reference “forward-looking information” which means disclosure regarding possible events, conditions, acquisitions, or results ofoperations that is based on assumptions about future conditions and courses of action and includes future oriented financial information with respect to prospective results ofoperations, financial position or cash flows that is presented either as a forecast or a projection, and also includes, but is not limited to, statements with respect to the futurefinancial and operating performance of the Company any of its subsidiaries and other considerations as set out in more detail in the documents filed by the Company with theToronto Stock Exchange. Often, but not always, forward-looking statements can be identified by the use of words such as “plans”, “proposes”, “expects”, “is expected”, “budget”,“scheduled”, “estimates”, “forecasts”, “intends”, “anticipates”, or “believes” or variations (including negative variations) of such words and phrases, or state that certain actions,events or results “may”, “could”, “would”, “might” or “will” be taken, occur or be achieved. Forward-looking statements involve known and unknown risks, uncertainties and otherfactors which may cause the actual results, performance or achievements of the Company and/or its current and proposed subsidiaries to be materially different from any futureresults, performance or achievements expressed or implied by the forward-looking statements. Forward-looking statements contained herein are made as of the date of thisPresentation and the Company disclaims any obligation to update any forward-looking statements, whether as a result of new information, future events or results or otherwise.Accordingly, readers should not place undue reliance on forward-looking statements due to the inherent uncertainty therein. In addition, investors are cautioned that thispresentation may contain information about mineral properties adjacent to or near the Company’s properties and in which the Company has no right or interest. Mineral depositson such adjacent or near properties are not indicative of the mineral deposits, if any, which may be found on the Company’s properties. Mineral resources that are not mineralreserves do not have demonstrated economic viability. Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSXVenture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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Disclaimer

1. History of Prophecy in Mongolia: 12 months

2. Accomplishment

Ulaan Ovoo

Invested Heavily, Equipment from Mongolia firms

90%+ Mongolia hires

30,000 tonnes to Darhan and Edernet

Upgrade road and bridge: look to commit further

Chandgana

EIA, Mining License Granted,

Final Power Plant License Waiting

International Bankers and Contractors in Progress

Our History and Records

Leadership: Management Team

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John Lee, CFA – Chairman / CEO

• Entrepreneur (BSEE, BAEcon: Rice U.) Started PCY in Oct 2010

• PCY market cap $1 million to $200 million in 14 months

Irina Plavutska, CGA - Interim CFO

• 20 years+ senior financial experience

Paul Venter – Director / VP Operations (Ulaan Baator)

• 30+ years mining/power experience with BHP/Eskom/En+

• Focus on Russian and Mongolian coal since 2006 with En+

Ronnie Van Eeden - VP Mining Operations(Ulaan Baator)

• 30+ years mining experience with Eskom / Sasol

• Management of the mining and supply of 90 to 100mt/year

Leadership: Directors

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Chuluunbaatar Baz

• President and Chairman of Monnis Group

• Monnis has over 1,000 employees, top 10 company in Mongolia

Jivko Savov

• Deputy CEO of En+, company owned by Oleg Derispeska

• Ex-Chairman of Rusal, Chairman of EurosibEnergo

Michael Deats

• Ex-Managing Director of BP Coal South Africa, Ex-Director of Eskom

Greg Hall

• Director of various public resource companies

• Formerly at Haywood Securities, Canaccord Capital, Leede Financial

Our secrets to permitting

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Local Partnership

Shareholder, Supply Chain, Marketing

Commitment to Mongolia

Time to cultivate trust

What’s in there for Mongolia

Adhere to the mining code

Rule of law prevails in a democratic country

Chandgana Power Plant Project

Mongolia

September , 2011

MongoliaEnergy consumption CLOSELY CORRELATES to GDP

Mongolia Economy growing VERY FAST (10%+)

No new power plant last 20 years

Mongolia today relies on VERY COSTLY power import

From Russia at 9c kwh (More than Canadian)

Diesel Fiasco

Current Power Plant Emission Standards VERY LOW

Mongolia Power

Supply / Demand Forecast

Source: Energy International9

0

200

400

600

800

1000

1200

1400

1600

2010 2011 2012 2013 2014 2015

Russia

EES

CES

Demand

Supply

MW

Deficit of

744 MW

Thermal power plants provide base load

Power Sources of Mongolia

UB Winter Blues(pic mongolia winter time)

Particles

Emission StandardsPM emissions from CHP2 and CHP3 are 20+ g/kWh

SO2 and NOx emissions from CHP2 and CHP3 are

6.6 g/kwh and 7.7 g/kWh.

Chandgana: 1 bil ton clean coal

(Sulphur < 1%)

20 MW

40 MW

Proposed Installed capacity:

Phase I: 4x150 MW (connect to CES, EES of Mongolia)

Phase II: 6x600 MW (connect to North East China)

Chandgana

Coal Mine600 MW Thermal

Power Plant on site

Power Transmission

to CES, EES,

SouthGobi, & China

14Source: Prophecy

Russia

Mongolia

China

Mongolia is currently

importing power from

Russia at a rate of

$0.08 per kWh

Chandgana – Power Plant Concept

� Proposed tentative location:

Location Chandgana Power Plant

Modern Plant with best environment & efficiency standards

less water, less coal, less pollution

(PM 1g vs 20g kwh, SO2/NOx 2g vs 6g kwh)

Build Plant with Best Safety standards with Mongolian Content

more skilled employment

Be most reasonable on Tariffs and Encourage/Welcome Auction

transparency, speed

Prophecy’s Commitment

Reduce Black Outs

Reduce Pollution

Energy Independence – No more Russian imports

Export Electricity – Sell Electricity, not the other way round

Save Money

Benefit

Let’s Work Together

Government:

Quick comments, reasonable in negotiation

Community:

Support Our Project, Give us feedback

Voice your Support

Prophecy:

Listen, Work with all levels

Bring capital and best expertise

Create win-win for Prophecy and Mongolia

Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

2011 2012 2013 2014 2015

Feasibility Submitted

• Power Plant

License Granted

• Bankable

feasibility study

Conclude PPA

Conclude Project Financing

Construction

Complete

Chandgana: Project timeline

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Already obtained:

- Environmental assessment approval

- Mining license

- Ministry Endorsement

Mongolia Power

Supply / Demand Forecast

Source: Energy International20

0

200

400

600

800

1000

1200

1400

1600

2010 2011 2012 2013 2014 2015

Russia

EES

CES

Demand

Supply

MW

Deficit of

744 MW

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Monoglia Office: Monnis Tower 8th Floor

info@prophecycoal.com

jlee@prophecycoal.com

www.prophecycoal.com

2nd Floor, 342 Water Street

Vancouver, BC , Canada

1.604.569.3661

PCY (tsx-v)

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