Announcement Details

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Sydney 23 February 2009 – White Energy Company Limited (ASX: WEC) (White Energy) today announced that it has entered into a Development Agreement with Mongolyn Alt Corporation (MAK), one of the largest independent miners in Mongolia and IB Daiwa Corporation (IB Daiwa), a Japanese investment group focusing on natural resources development and investment, to conduct a feasibility study to evaluate the economic, technical and logistical viability of constructing coal upgrading plants in Mongolia.

The three parties will work closely together over the next few months to finalise the feasibility work. It is proposed that the project will utilise White Energy’s licensed and patented binderless coal briquetting process to upgrade coal from MAK’s lignite deposit at Aduunchuluun, Mongolia, located in Eastern Mongolia near the Mongolian‐Chinese border. The Aduunchuluun deposit has 220 million metric tonnes of measured lignite resources, which has the potential to increase to up to over 400 million metric tonnes. White Energy has successfully processed a sample of coal from the Aduunchuluun deposit and MAK is currently preparing to send 500 tonnes of coal from the Aduunchuluun deposit to White Energy for processing at White Energy’s 90,000 tpa production plant located at Cessnock, NSW.

The sample work done to date proved that White Energy’s coal upgrading process significantly enhanced the energy efficiency of the MAK feedstock coal, creating a higher energy, stable product. This upgraded coal could then be sold domestically or sold into the broader export markets.

The feasibility study will initially focus on one coal upgrading plant with a capacity of one million tonnes per annum. However following the feasibility study process, the parties will examine options to significantly expand the capacity of the project. The parties are currently in negotiations regarding the commercial terms of the venture and envisage coming to agreement on the relevant commercial terms by the time the feasibility work is finished.

John Atkinson, White Energy’s Managing Director said, “We are pleased to have signed this development agreement with MAK and IB Daiwa. Mongolia is ideally situated to play a key strategic role in providing coal for the key markets in North Asia, particularly China. MAK has access to significant coal resources in Mongolia, which in preliminary testing has been shown to be ideal for upgrading by White Energy’s unique binderless coal briquetting process. We are looking forward to processing the larger 500 tonne sample of coal to be provided by MAK at our Cessnock Plant and completing the feasibility study as soon as we can”.

B. Nyamtaishir, MAK’s President and CEO said, “We are pleased to be beginning this project with White Energy as we believe that White Energy’s coal upgrading process is the most suitable process to maximize the value of our high moisture coal deposits in Mongolia. MAK is committed to the Aduunchuluun project and wishes to explore applying the White Energy technology to even other coal deposits owned by MAK in Mongolia”.

Seiki Takahashi, President of IB Daiwa said, “I am pleased to be able to facilitate and co‐invest in the preparation of the feasibility study for the project with White Energy and MAK, which will bring greater diversity to the Mongolian energy market”.