The Chairman and Managing Director`s AGM Address

30 November 2010

Announcement Details
ASX URL: http://www.asx.com.au/asx/research/companyInfo.do?by=asxCode&asxCode=wec#headlines

Summary

The Chairman and Managing Director’s Address

Attached are the addresses to be given by the Chairman Mr. Travers Duncan and Managing Director Mr. Brian Flannery today at White Energy’s Annual General Meeting.

Chairman’s Address

Shareholders and guests, welcome to the 2010 Annual General Meeting of White Energy Company Limited (“White Energy” or “the Company”).

The past 12 months has been a period of progress and transition at White Energy. During the past financial year White Energy took steps to broaden its asset base as we seek to occupy a unique position in the Australian coal sector – that of a diversified coal company built around a mix of coal technology and conventional coal assets. The Company’s progress in 2010 has been well supported by the market. Our entry to the S&P / ASX-200 is a significant milestone and one which we will continue to build upon as our Indonesian operations move into commercial production and we target acquisition opportunities across the coal sector.

Since the publication of your Company’s Annual Report there have been some significant developments for shareholders with continued progress at our commercial coal upgrading plant in Tabang, Indonesia and today’s announcement of the proposed acquisition of Cascade Coal Pty Limited.

During the meeting today I will address the annual FY2010 performance of White Energy and discuss the positioning of your Company as a broader player in the Australian coal sector. Your Managing Director, Mr. Brian Flannery, will deal with the Company’s operational and technical activities in more detail.

I would like to take this opportunity to welcome your new Board members to their first White Energy Annual General Meeting. I have a long history of working with Mr. Flannery in coal asset development and have shared a prior professional relationship with all of your new Directors, most recently at Felix Resources Limited.

BCB coal upgrading technology

Progress continues at our coal upgrading plant at the Tabang coal mine in Indonesia. Despite delays in supporting infrastructure the core BCB process is working.

Tabang is a pioneer project that will demonstrate the ability to upgrade the inherent value of uneconomic coal resources anywhere around the world. At times we need to remind ourselves that ‘pathfinding’ is rarely easy or smooth. We believe in the importance of getting right the first fully commercial scale coal upgrading plant because it will underpin the success of the next phase of our expansion. Of importance to our future coal upgrading modules is that our plant design and rectification works have been adequately captured and form part of our design and engineering intellectual capital which will be applied to future modules.

In addition to Indonesia, White Energy continues to focus considerable attention on its North American business development initiatives. WECNA, our wholly owned North American subsidiary, submitted the Air and Development Permit for the Peabody Caballo project in the Powder River Basin, Wyoming, in October this year and is expecting to lodge the Air and Development Permit for the Kiewit Buckskin project, Wyoming, in the coming weeks. It is anticipated that the approval process for both the Kiewit Buckskin and Peabody Caballo project will take between 12-18 months, after which WECNA will be able to start construction activities.

Our North American activities were assisted by the receipt in September this year of approval from the Lousiville Metro Air Pollution Control District to build a coal upgrading facility located in Louisville, Kentucky, to be called the Jefferson Riverport Project. The Board is currently assessing the financial and strategic merits of the Jefferson Riverport Project and will make an investment decision early in 2011. This proposed plant would be a trial plant and as such the merits of spending this capital will be subject to a final detailed feasibility study.

White Energy continues to actively pursue opportunities associated with the deployment of our BCB technology to the upgrading and briquetting of discarded coal fines. During the year we have continued to work closely with River Energy (our 51% owned joint venture with Black River/Cargill) to commercialise this opportunity in Africa. Due to the vast quantities of high quality coal fines in all of the key coal producing markets, we are particularly interested by this opportunity and believe that there is significant scope to actively target other coal fines markets in the near future.

Coal sector acquisitions

During the course of the year White Energy’s management identified an opportunity to diversify its asset base and become a developer and operator of conventional coal assets. The ability to own and operate a mix of coal technology assets and traditional coal mine assets was seen as a driver of shareholder value.

The acquisition of South Australian Coal Limited (“SACL”) was completed in July 2010 after being targeted as a highly strategic asset due to the complementary nature of our coal upgrading technology with this higher moisture coal resource. In 2011 we will continue our drilling program at SACL and evaluate options as how best to commercialise this coal resource.

Importantly the SACL acquisition was transformative for White Energy as it gave us the capacity to pursue a ‘strategic diversification’ by drawing on the experience of the expanded Board and new executive management team under Brian Flannery. Together, they have brought us deep experience in coal project development and management.

Earlier today White Energy announced that it has signed a 28 day option and exclusivity agreement to acquire Cascade Coal Pty Limited (“Cascade”), a privately owned coal exploration and development company which owns the Mt Penny (EL 7406) and Glendon Brook (EL 7405) coal exploration licenses in NSW. The proposed acquisition of Cascade will provide an opportunity for White Energy’s shareholder’s to gain exposure to the NSW export coal industry at a time when quality coal assets are becoming more difficult to identify and acquire, due to competition from overseas interests.

Mt Penny is located in the Western Coalfields of New South Wales and has a resource of 173.7 Mt of export quality thermal coal calculated in accordance with the JORC code. The measured and indicated resources are amenable to open-cut development.
Mt Penny is divided into five separate resource blocks, with Cascade having focused its planning of approvals and planning for development to date on Resource Block 1, known as Open-Cut 1. The mine plan for Open-cut 1 is complete with a mineable resource of 119 Mt. A defining feature of Cascade is Mt Penny’s proximity to infrastructure. The existing Sandy-Hollow – Ulan Railway is ideally situated and passes through Mt Penny and allows for primary access to the Port of Newcastle.

Glendon Brook (EL7405) is located in the heart of the Hunter Valley Coalfield, approximately 12km from Singleton, bordering Mitchell’s Flat (ML 1306) owned by Xstrata. Cascade has commenced exploration at Glendon Brook and preliminary exploration results indicate an exploration target in the order of 50 Mt.

As highlighted in this morning’s announcement the vendors of the Cascade Coal assets include several directors of White Energy – myself, Mr. Brian Flannery, Mr. John Atkinson, Mr. John McGuigan and Mr. John Kinghorn. Due to the related party nature of the transaction an Independent Board Committee has been established with Mr. Graham Cubbin as committee chairman, to assess and implement the proposed acquisition on behalf of the Company. The independent board committee has appointed Citi as its financial advisor and Freehills as its the legal advisor.

Because of their involvement with White Energy, the owners of Cascade believed it was right that these quality opportunities should be offered first to White Energy. The option arrangement allows White Energy ‘first choice’, but without obligation. If White Energy shareholders decide against proceeding, then Cascade owners will be free to develop the assets independently.

Of particular note to the proposed Cascade acquisition is that Mt Penny (EL 7406) is located in the Western Coalfields, an area of the NSW coal basin that your Board and management team have considerable experience in developing. In the late 1970’s to the early 1980’s, White Mining Limited was responsible for the staged development of the Ulan coal mine, which was the first coal mine to implement an in-pit crusher and conveyor system as well as the largest longwall at the time. During that period, Mr. Flannery and Mr. Mike Chapman, White Energy’s COO, were responsible for the commission of the Ulan Mine and the railway to Muswellbrook. More recently, Mr. Flannery and other newly appointed members of White Energy’s operations team, including Mr. Chapman, were responsible for developing Felix Resource’s Moolarben mine on budget and in record time. The benefit of our collective experience and expertise in the Western Coalfield cannot be understated for the near term development of Mt Penny.

The proposed acquisition of Cascade will be made via a mix of limited cash plus script, with White Energy able to deploy its balance sheet for the cash component of the acquisition. We look forward to providing additional material on Cascade and the merits of the transaction to shareholders in the coming weeks.

Thank you

On a final, but very important note, I would like to thank the previous Chairman, Mr. McGuigan and the previous Managing Director, Mr. Atkinson for their outstanding work and efforts in recent times. During Mr. Atkinson’s tenure as White Energy’s Managing Director your Company has evolved from a technology based company to a diversified coal company in the S&P / ASX-200, generating significant shareholder value along the way. I look forward to continuing White Energy’s working relationship with both Mr. McGuigan and Mr. Atkinson through their ongoing roles on the Board as non-executive directors.

I wish to thank all shareholders, employees and suppliers and strategic partners for their support through 2010, and look forward to an exciting future ahead for White Energy.
I recommend shareholder support of all seven resolutions to be voted on at today’s 2010 Annual General Meeting. I now invite Brian Flannery, Managing Director of WECL, to address the meeting.

Thank you,
Travers W Duncan
Chairman

Note: Cascades exploration to date has confirmed the presence of a coal resource of 173.7 Mt calculated in accordance with the JORC code as follows:
95.3 Mt
Measured Resources
22.3 Mt
Indicated Resources
56.1 Mt
Inferred Resources
To date 580 raw ply samples have been tested, producing the following results:
High Volatile Bituminous Coal;
Low Moisture generally less than 3% (Air Dry Basis);
High Volatile 35-37% (Dry Ash Free);
Fuel ratio between 1.6 and 1.7;
Low Sulphur generally less than 0.5%;
GCV 34.5Mj/kg (Dry Ash Free);
Ash Fusion Temperature ranges from 1,350 -1,550 degrees (reducing);
Low slagging Index -1,530 degrees; and
Low fouling Index- .02.
Note: Glendon Brook, the potential quantity and grade is conceptual in nature, there has been insufficient exploration to define a mineral resource and it is uncertain if further exploration will result in the determination of a mineral resource

Managing Director’s Address

Ladies and Gentleman,
It is with great pleasure that I address you today in my new role as Managing Director of White Energy. As mentioned by Mr. Duncan, we have established a successful history of working together in the Australian coal sector, first with the predecessor to this Company, White Mining Limited, and more recently at Felix Resources Limited. The opportunity to lead White Energy through its next phase of growth as we work to unlock the true potential of the BCB technology and build an independent mid-tier Australian coal company was a key attraction.

2010 has been a year of significant growth and achievement as recognized by our entry into the S&P / ASX 200, but at the same time we are looking forward to 2011 where we are able to ramp-up to commercial production at our Indonesian plant. We are the first to acknowledge that we are not at the point of commercialization that we wish to be due to technical issues associated with ancillary processes such as the dust extraction and product handling and cooling system. We remain confident in the BCB technology and look forward to consistent sales of the world’s first upgraded coal using this technology.

2010 also saw White Energy successfully grow its asset base through the acquisition of South Australian Coal Limited (“SACL”). As a consequence of that transaction White Energy is now organized around two distinct, but related, business divisions – Coal Technology and Coal Mining. The SACL acquisition has provided White Energy with the foundations to add new skills and expertise to your Board and attract a management team with a proven track record in coal asset development and operation. This expertise and experience will assist White Energy with improving the performance of our Indonesian plant at Tabang, drive the roll-out of the BCB technology in new markets such as North America, commercialise the application of the BCB technology to coal fines and develop export coal mines.

Today’s announcement of White Energy’s option to acquire Cascade Coal is another clear step in realising our strategy of acquiring quality coal assets which will create shareholder value as we build a more diverse coal company. A broader collection of coal assets will ensure White Energy is well positioned to take advantage of strong demand for coal from key Asian markets such as China, India, Japan and Korea. Mr Duncan and I have declared a conflict of interest as we are shareholders of Cascade Coal, however we are pleased to answer questions you may have on this proposed transaction.

PT Kaltim Supacoal (“KSC”) – Joint Venture with Bayan Resources – Tabang Coal Upgrading Plant

Significant achievement continues to be made at our 51% owned joint venture company, KSC, with the ramp-up of operations at our coal upgrading plant. However as highlighted by Mr. Duncan progress has been slowed over the last 6 months due to necessary engineering modifications that are being made to the plant.

Despite technical challenges causing delays to our production schedule, we continue to be buoyed by our recent successes at Tabang which includes the following:

Consistent upgrading of feedstock coal from 4,000 - 4,400 kcals/kg GAR to 5,800 - 5,900 kcals/kg GAR with a 10-12% moisture content;

The successful design and engineering modifications to the briquetter hoods removing the excess dust and an improvement to the coal injection system; and

The sale of over 17,000 tonnes of upgraded coal to our joint venture partner, Bayan Resources, which they use to upgrade their standard ROM product

The next phase of operations is focused on producing upgraded coal with an energy value of 6,100 kcals/kg GAR with 8% moisture content for sustained production runs. To achieve this, we have commenced work on the remaining rectification issues at the plant which we hope to complete by mid 2011. A summary of the final design technical rectification issues underway are as follows:

Coal Drying: To reduce the moisture content down to the target level of 7% out of the drying column, there is need to lengthen the drying column. This is a relatively simple process requiring an extension to the current column based on a calculation of the moisture content in the feedstock coal. Design work to lengthen the column has commenced.

Briquetting machines: The mechanics of each briquetter’s drive shaft between motor and gearbox and motor have not been performed to design. The standardized nature of the briquetter gearbox and motor has allowed for a simple engineering solution where we will install a new flexible coupling on each briquette machine. The plant will not need to be shut down to implement these changes

Power station: The remote location of the Tabang site requires an external power supply. Reliability issues with the primary/secondary fans and steam valves at the power station have resulted in unnecessary production downtime that is not related to the BCB process. New valves and higher quality bearings have been sourced to eliminate this error arising in the future

The final outstanding issue that our design and engineering team is attending to relates to product handling and cooling systems at the plant. Due to the relatively high ambient air temperature and humidity levels at Tabang, the cooling process is not operating as designed on the relatively short conveyors that were put in place at the plant. We see this final step purely as a mechanical issue which we expect to overcome in the near future which will allow for the sale of commercial quantities of KSC coal into Asian export markets.

During 2011 we will continue to focus our operational resources at Tabang and support KSC as it transitions successfully to full operating mode. Once an investment decision is made on the proposed expansion of KSC’s coal upgrading facility to 5 mtpa, our team will provide on-site construction guidance and further training to KSC’s Indonesian work force. Mr. Mike Chapman, White Energy’s COO, and his experienced coal operations team have based themselves in Balikpapan and Tabang to ensure our expertise and experience is available where it is most needed and relevant.

Much of the future coal mining potential from Indonesia involves high moisture coals in the 30 to 50% range. These coals, whilst often low in ash and sulphur, are extremely inefficient in regards to CO2 make per unit of electricity. The BCB technology when applied to Indonesian coals in most cases doubles their value. The price uplift margin is significant. Couple this with very low ash and sulphur levels results in the production of a very attractive thermal coal product. For this reason, Indonesia is a key market for the BCB technology.

The submission of the Wyoming Air and Development Permit for the Peabody Project is a step forward for our North American operations and our joint venture partners there. White Energy has deployed design and engineering capabilities from Australia to manage the ‘Americanisation’ of the coal plant design and will continue to farm-in resources as is needed as these Projects progress.

Cascade Coal

The proposed acquisition of Cascade Coal Pty Limited (“Cascade”) is a further company-changer for White Energy. Quality coal assets, let alone coal assets at an advanced stage of development are becoming increasingly difficult to acquire. Assuming successful completion of the transaction, Cascade will deliver to White Energy shareholders two export quality thermal coal assets which we will actively develop, as well as position us for further acquisition opportunities across the coal sector. Cascade has successfully progressed the development of Mt Penny to the point where application for a Mining Lease is imminent. Pending a granting of the Mining Lease for Mt Penny’s Open-cut 1, we are hopeful of commencing mine construction in 2012, with first coal sales anticipated in 2013.

As stated by Mr. Duncan, Cascade has channeled a significant share of its time and resources into Resource Block 1, known as Open-cut 1, which has an identified mineable resource of 119 Mt. The mine plan for Open-cut 1 is for run of mine production of 5Mtpa with a projected net saleable production in accordance with the conceptual development plan approved by the NSW Department of Industry and Investment of between 3.5 – 4 Mtpa, implying a 21 year life of mine at Resource Block 1.

Mt Penny’s access to infrastructure is a key advantage of the project as it reduces the capital commitment required to upgrade relevant infrastructure to get coal to market. In addition, Cascade has been in negotiation with land owners regarding access to land for Open-cut 1 and has been able to secure power supply and water rights to develop Open-cut 1. Again this positions the asset well for near term development.

If the acquisition is approved by shareholders, White Energy intends to continue the substantial progress that has been made by Cascade and submit a Major Projects Application to the Department of Planning for Open-cut 1 in the near future. In parallel White Energy will continue to evaluate other partnership and development options at Mt Penny and at Glendon Brook.
Finally I would like to thank all of our shareholders for their support throughout 2010. I look forward to working with you and delivering on your company’s potential. To all our employees, thank you for your hard work throughout 2010 and the progress that has been achieved at White Energy.

Thank you
Brian Flannery
Managing Director

Forward Looking Statements

Except for the historical information contained herein, the matters discussed in this presentation contain forward-looking statements, including statements, containing the words “planned”, “expects”, “believes”, “strategy”, “opportunity”, “anticipates”, and similar words. Such forward-looking statements are subject to known and unknown risks, uncertainties, or other factors that may cause the company’s actual results to be materially different from historical results or any results expressed or implied by such forward-looking statements. We assume no obligation to update any forward-looking statements to reflect events or circumstances arising after the date hereof. In addition where comparisons are made between White Energy Company and other companies, we have made best efforts to properly interpret publicly made information by these companies but cannot be certain that such comparisons are completely accurate.
Competent Persons Statement

The information in this announcement concerning the proposed acquisition of Cascade Coal Pty Limited by White Energy, which relates to Coal Resources at EL7406 and EL7405 is based on information compiled by Mr Michael Johnstone, who is a member of the Australasian Institute of Mining and Metallurgy. Mr Johnstone is the principal consultant of Minerva Geological Services PL.

Mr Michael Johnstone has 32 years of relevant mining and geological experience in coal. During this time he has either managed exploration programs or contributed significantly to mining studies related to the estimation and assessment of coal resources, and in the development of coal mining operations in Australia, India, Pakistan, Philippines and Vietnam. He was the project Geologist responsible for implementing the Ulan Stage 2 exploration program, and Exploration Manager for the Ashton and recently commissioned Moolarben Development. He has sufficient experience which is relevant to the style of coal occurrence and type of deposit under consideration and to the activity he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the “Australasian Code for Reporting Mineral Resources and Ore Reserves”. Pursuant to the requirements of ASX Listing Rule 5.6, Mr Johnstone consents to the inclusion in the announcement of the matters based on their information in the form and context, which it appears.