IPO: Pike River Coal Limited

You are offered a unique opportunity to invest in shares in Pike River Coal Limited, New Zealand’s only local listed coal mining company. Pike River Coal Limited (Pike River) has an initial public offer to raise a minimum of $65 million underway. The offer closes on 10 July 2007. Up to $20 million of over-subscriptions may be accepted at Pike River’s discretion.

Fuelled by global economic growth, there is strong international demand for hard coking coal for steel production. Pike River Coal Limited is the coal mining and export company that owns a major new mine north-east of Greymouth, being developed to produce premium quality hard coking coal.

Invest in Real Potential

The Pike River Coalfield is New Zealand’s largest known deposit of hard-coking coal with an in-ground resource of 58.5 million tonnes.

The mine is already well into development with substantial investment made, key development and coal sales contracts signed and an experienced management team in place. There is strong projected cash flow when in full production.

Key Investment Points

A major new exporter:
Pike River sales revenue for the first full production year in 2009 is estimated at $172 million, based on the current mine plan and independently forecast coal prices and exchange rates. Strong cash flows are projected for that year going forward.

With lots of coal:
New Zealand’s largest known deposit of premium hard coking coal is expected to produce at least 17.6 million tonnes.

In high demand:
Demand for Pike River’s coal is very strong. For the first three years of production close to 70 per cent of production has been conditionally sold, and 55 per cent conditionally sold for the entire mine life.

Used to make steel internationally:
Hard coking coal is premium coal used in steelmaking. Steel is used in most parts of your daily life, from cars to planes, canned goods to factories, office blocks to hospitals and hydro dams to wind turbines. Global demand for steel has grown strongly in recent years, led by demand throughout Asia. It is forecast to keep growing.

Creating jobs in New Zealand:
150 new jobs will be created directly by the new mine and several hundred indirectly through supply and service arrangements.

With low environmental impact:
A combination of underground mining, a very small footprint on the land and careful conservation programmes developed in consultation with the Department of Conservation, result in minimal environmental impact.

And starting soon:
First coal production is scheduled to begin in March 2008

Key Risks
As a development project there is no operating history on which to base estimates of future operating costs, capital requirements and revenue. The development of a mine is subject to a number of risks such as unforeseen geological and mining conditions. Investors should carefully consider these and other risks detailed in the Prospectus.