LUBLIN COAL PROJECT PRESENTATION March 2014 - ASX: PDZ

ABN 23 008 677 852

Minesite Investor Forum, London, 11 March 2014

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Lublin Coal Project Map

Lublin Coal Project

Prairie Downs Metals Limited (ASX:PDZ) is an ASX listed company developing the Lublin Coal Project in Poland’s world class Lublin Coal basin

Large scale, high quality coal resource with semi-soft coking/premium thermal potential - Inferred Coal Resource Estimate of 1.6 1 billion tonnes

Existing rail and port infrastructure providing access to domestic, European and other export markets

Adjacent to the world-class Bogdanka (WSE:LWB) longwall coal mine - Europe’s lowest operating cost coal mine

Confirmatory drilling program underway and Scoping Study being completed by Wardell Armstrong International Ltd (H1 2014)

Experienced board and management team with strong coal expertise and experience in Poland

1 JORC (Inferred), refer to maiden coal resource ASX announcement released on 14 February 2013

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Belchatow Power Station (4,440MW), Poland

Coal Terminal at Gdansk, Poland

Source: Eurostat and Polish Ministry of Treasury

Poland: A favorable investment jurisdiction

Poland is a safe, low risk mining jurisdiction with an excellent fiscal regime…

One of the most attractive fiscal regimes globally for coal

Poland is a first world country having gone through significant reform since the end of communism in 1989 Over US$120 billion in foreign direct investment into Poland

since 2004 Poland is the largest hard coal producer in Europe and is a

key supplier of coal to its domestic market and neighbours Poland has a highly skilled coal mining workforce, with

110,000 people still directly employed in the industry Availability and low cost of skilled labour make Poland an

attractive jurisdiction to develop coal projects

19% corporate tax rate

No Requirement for Government Participation

4PLN/t royalty (~US$1.2/t)

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The emergence of the Lublin Coal Basin

Initial drilling in the 1950's across the basin in search of gas reserves

Discovered massive coal resources Government then drilled hundreds of

boreholes between 1960-1980's State owned company Bogdanka

commenced production in 1982 Bogdanka has been sole operator ever

since Prairie Downs was the first foreign

entrant into Lublin in 2012 - Footprint of 184km² of drilled ground adjacent to

Bogdanka

- Access to data from more than 200 historical boreholes (200,000m of drilling) F

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With the Upper Silesian Basin in decline, the Lublin Coal Basin is set to become the pre-eminent coal basin in Europe given favourable geology and mining conditions…

Polish Coal: A tale of two different coal basins

Coal Geology

Seam Dip Variability Faulting Methane Rockburst

0o - 45o High High High High

Coal Geology

Seam Dip Variability Faulting Methane Rockburst

0o - 2o Low Low Low Low

Size 9,100 km2

Years in Production 30

Production 8.5 mtpa

No. Operating Mines 1

Typical Longwall Panel

300 metre face

Up to 5 km length

Size * 5,400km2

Years in Production 250

Production 82 mtpa

No. Operating Mines 29

Typical Longwall Panel

150 metre face

1.2 km length

Silesian Basin Lublin Basin

* 5,400km total of which 4,500 within Poland. Source PWN encyklopedia

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Bogdanka at a Glance

Privatised by way of an IPO on Warsaw Stock Exchange in 2009

Current enterprise value in excess of USD1.6Bn with a 4% dividend yield in 2013

EBITDA margin of 39% (H1 2013)

Produced 8.4mt thermal coal in 2013 expanding to 12mtpa by 2015

Lowest operating cost coal mine in Europe at unit cash costs of $43/t (saleable coal free-on-rail)

Bogdanka Coal Mine

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Lower Operating costs are primarily a function of favourable geology

Geology and mining conditions ideal for modern longwall plow operations

Caterpillar longwall plows have been employed at Bogdanka with remarkable success

World record production rate of 12.680tpd, equivalent to 4mtpa from a single longwall

Q2 2013 Unit Mining Cash Costs (Source: Company Filings, 3.15 PLN/USD, 0.74 EUR/USD)

Lublin Basin: First Quartile Operating Costs

Caterpillar Longwall Plow

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Prairie Downs Lublin Coal Project Dominant Basin Position

1.61 Billion tonne Inferred JORC Compliant Coal Resource Estimate

6801 million tonnes (inferred) found within three high quality coal seams

Total resource located within 20 potentially economic coal seams

391 Seam 379 Seam 382 Seam

3271 Million tonnes (inferred) 1901 Million tonnes (inferred) 1631 Million tonnes (inferred)

8.4% Ash 12.4% Ash 11.6% Ash

6,908 kcal/kg 6,493 kcal/kg 6,547 kcal/kg

1 JORC (Inferred), refer to maiden coal resource ASX announcement released on 14 February 2013

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3271 million tonne Inferred JORC Compliant Coal Resource in the one thick, contiguous and high quality 391 coal seam…

Note: 391 seam isopachs based on historical core and geophysical logs 1 JORC (Inferred), refer to maiden coal resource ASX announcement released on 14 February 2013

Favourable Geology F

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Initial testing has indicated that the Lublin Coal Project potentially hosts metallurgical coal which compares very well with current semi-soft benchmark coals…

391 Coal Seam Quality & Comparisons

Prairie Downs 391 Seam*

Typical Semi-Soft Coking Typical Thermal

Hunter Valley Russia Poland ARA Russia South Africa

Ash (%) 4.4 9.0 10.0 8.0 <16.0 16.8 17.4

Calorific Value kcal/kg gad 7,558 7,320 7,426 n/a ~6,700 7,100 6,126

FSI 5.5 4.0 – 6.0 2.0 – 3.0 5.0 – 8.0 - - -

Sulphur (%) 0.89 <1.0%

Metallurgical & Thermal Potential

Historical geological reports for the project had indicated the presence of Polish coal “type 34”, which is equivalent to semi-soft coking coal This has now been confirmed by the current core drilling program

*The coal quality result presented in this table is based on coal quality analysis conducted on raw (unwashed) coal from the 391 seam taken from the first drill hole (Kopina 1) of the current core drilling campaign at the Lublin Coal Project.

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Rail, Port and Power infrastructure are all in place in Poland for new developments to supply both export and domestic European markets…

Underutilised Coal Export Ports

Poland was the world’s 2nd largest coal exporter during the 1980’s, exporting 45mtpa

Capesize and Panamax capable

Terminals are now well underutilised

Bulk Freight Rail System

Coal freight has been an established part of the Polish rail system for decades

Significant capacity available to export terminals and for domestic European sales

Electrified system ensures very competitive rates

Power: 90% Coal Fired

Coal fired generation ensures very low cost power

Very well established high voltage power distribution system

Multiple international utilities present in Poland

Export & Domestic Infrastructure F

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Lublin Coal Project’s location and access to infrastructure gives it a distinct advantage to capture key regional markets for both metallurgical and thermal coals…

Excellent Seaborne European Market Penetration

Ability to penetrate all key European markets with access to Polish Coal Ports

Potential for further exports into BRIC countries if demand warrants

Spain, Italy and Turkey are key import regions

Competitive Freight Advantage F

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Exploration Program

Scoping Study being completed by Wardell Armstrong to: - Outline production profile and schedule

- Provide detailed mine plan and process flow sheet

- Estimate capital and operating costs

Core drilling program currently being completed to: - Validate historical drilling

- Update geological model

- Support coal quality and washability testing

Comprehensive coal quality and coal washability tests underway to: - Identify product specification and target markets

- Facilitate discussions with potential off-takers

Drill Core & Drill Rig on Site

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Building a world class team in Poland F

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Ben Stoikovich Chief Executive Officer

Highly respected, London based, mining engineer and investment banker Eight years’ experience in underground longwall coal mining operations with BHP Billiton; Holds an Australian

(NSW) underground coal mine managers certificate of competency Former Director of Metals and Mining Corporate Finance for Standard Chartered Bank in London, completing over

$15 billion worth of international mergers and acquisitions transactions and a range of leveraged finance, project finance and corporate debt facilities for global mining companies

Ian Middlemas Chairman

Highly respected resource executive with extensive finance, commercial and capital markets experience Current Chairman of Papillion Resources Limited, Equatorial Resources Limited, Berkeley Resources Limited &

former Chairman of Coalspur Mines Limited and Mantra Resources Limited

Anastasios Arima Executive Director

Founder & former Executive Director of Coalspur Mines Limited having been instrumental in developing Coalspur from a A$3 million market capitalisation to a A$1.2 billion market capitalisation company upon his departure

Current Director of Paringa Resources Limited, an ASX-listed company developing coal projects in the USA

John Welborn Director

Current Managing Director of Equatorial Resources Limited (ASX: EQX) and previously a senior executive at Investec

Mark Pearce Director

Current director of a number of ASX listed companies including Equatorial Resources Limited and Aviva Corporation and was formerly a Director and CFO of Coalspur Mines Limited and a founding director of Mantra Resources Limited

Hugo Schumann Corporate Executive

Business development and investor relations executive with strong capital markets experience. Holds an MBA from INSEAD, is a CFA Charterholder and holds a Bachelor of Business Science from the University of Cape Town.

Strong board & management with proven development experience… Experience Board and Management

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Janusz Jakimowicz President & Chairman of PD Co

Geologist with over 30 years experience and a proven ability in the identification, exploration and appraisal of international resource projects. Held positions at Ashton Mining, BHP Billiton and Striker Resources (North Australian Diamonds)

Dual Polish and Australian citizenship Instrumental in identifying, negotiating and applying for the concessions and progressing the development of the Lublin Coal

Project

Mr Mirosław Taras Strategic Advisor

Former Executive Chairman of the Management Board of Lubelski Węgiel Bogdanka (“Bogdanka”), having worked in the Lublin Coal Basin since 1980 commencing as an underground coal mine operator and rising to the rank of Chairman of the Management Board of Bogdanka in February 2008 where he remained until September 2012

During his time as Chairman, Bogdanka’s profits and EBITDA doubled and coal production increased to 8mtpa. He also led the successful defence of Bogdanka following a hostile US$1.2bn takeover bid by New World Resources in 2010

Instrumental in the adoption of automated longwall plow technology at Bogdanka, leading them to set the world record for daily production for a plow-equipped longwall in 2012

Dr Jacek Jezierski Supervisory Board of PD Co

Ex-Deputy Minister Poland’s Ministry of the Environment (“MoE”) (2007 to 2011), Under Secretary of State, Chief National Geologist, Deputy Director of the Office of the Polish Oil and Gas Company Inc (“PGNiG SA”); and expert advisor to the World Bank

Previously Director on the Supervisory Board of Kompania Weglowa SA (“KW”), Poland’s largest coal mining company Holds a PhD in Geology and completed his Master’s degree in Geology at the University of Warsaw, where he focused his thesis on

the Lublin coal basin

Mr Artur K. Kluczny Supervisory Board of PD Co

Held position in Poland’s Ministry of Privatization (MSP), where he was in charge of corporate oversight of National Investment Funds and sale of state-owned portfolio companies. Served in the Prime Minister’s Office as the secretary to two successive prime ministers and was senior government representative on the Council for Development of the Financial Market (RRRF) in Poland

Up until 2009, he served as Deputy Chairman of the Board of the Polish Financial Supervision Authority (KNF) responsible for capital markets supervisions (Warsaw Stock Exchange) and was a member of the Committee of European Securities Regulators in Paris (replaced by ESMA in 2011)

Dr Witold Woloszyn Environmental Manager

Over 20 years experience preparing Environmental Impact Assessments in Poland for local, regional and national authorities; previously Chair of the Lublin Regional EIA Commission and member of the Polish National Commission for EIA’s.

Holds an MSc in EIA Assessment from the UK, and a Doctorate from the University of Marie Curie Sklodowska; recent involvement with the shale gas sector in Poland

Respected and established Polish team…

Polish Executive Team F

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Corporate Structure

PRAIRIE DOWNS METALS LTD (ASX: PDZ) As at 10 March 2014

Current Issued Capital 132.3m

Fully Diluted 158.9m

Market Capitalisation (Undiluted @ A$0.32) A$42.3 million

Cash at 31 January 2014 A$5.2 million

Listed Securities Held* A$14.0 million

Enterprise Value A$23.1 million

Top 20 Shareholders: 44%

Directors & Associates: 14%

*Prairie Downs holds 10 million ordinary shares in ASX listed company Papillon Resources Limited (ASX: PIR)

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Q1 2014 Results from coal quality and coal washability testing

Q1 2014 Results from marketing study

Q2 2014 JORC Resource estimate upgrade

Q2 2014 Publication of Scoping Study

Q3 2014 Commence Pre-Feasibility Study

H2 2014 Further drilling results and coal quality test results

Near term news flow and milestones….

Significant Re-rating Potential…. F

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Europe’s next

www.prairiedownsmetals.com.au

ADDITIONAL SLIDES

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Lublin Coking Coal Potential

Source: Wood Mackenzie, BRE Securities

Strong long term demand growth for coking coal expected in India, Brazil, Germany and Ukraine

Greater Europe (EU inc Turkey) consumes over 70mt of metallurgical coal per year

Poland is Europe’s largest producer and exporter of coke, producing over 10mt in 2011 from the Silesian basin

Silesian mines are in decline due to high costs and poor operating conditions, leaving a gap for new entrants

Seaborne Metallurgical Coal Demand – 2013 & Growth to 2035

Coke Oven

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During 2012, Europe1 consumed over 770mt of coal for power generation, of which 265mt was thermal coal. Thermal coal imports amounted to 172mt, accounting for 22% of globally traded thermal coal…

Total Europe Lignite and Thermal Coal Consumption (2012)

12

1 2France

4

1 2Portugal

7

19

1 2Spain

19

1 2Italy

15

40

1 2UK

9

1 2Netherlands

10

33

1 2Germany

52

8

1 2Poland

2

1 2Romania

3 1

1 2Czech Republic 2

1 2Austria

2 2

1 2Bulgaria 3

20

1 2Turkey

3

1 2Finland

European Thermal Coal Imports & Production by Country (2012)

Source: Euracoal (2012) 1 Europe is the EU plus Turkey

Thermal Coal Production (2012) Thermal Coal Imports (2012)

509 mt

93 mt

172 mt

LigniteProduction

ThermalProduction

ThermalImports

Thermal Coal – Fundamental to Europe’s Energy Matrix

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Europe’s hard coal production continues to decline as viable coal resources deplete

Traditional coal basins in Germany, UK, Czech Republic and Poland that have been operating for hundreds of years are becoming increasingly technically challenging and costly

Hard coal production from Poland’s primary coal producing basin, the Upper Silesian basin, has declined by over 20mtpa in the last decade and declined 4.2% over the last twelve months

UK hard coal production fell to a record low of 17mt in 2012, with further curtailment in 2013 due to mine closures (Daw Mill Colliery closed in March 2013 and represents a 1.6mtpa production loss)

Germany is expected to close all hard coal mines by 2018 due to the ending of government subsidies, resulting in 12mtpa of hard coal production to be replaced by imports

European Hard Coal1 Production (million tonnes)

0

50

100

150

200

250

300

350

400

1991 1995 1999 2003 2007 2011

Rest of EUCzech RepublicGermanyUnited KingdomPoland

Source: Eurostat

365mt (total)

295mt

227mt 189mt

155mt 127mt

1 Hard Coal includes Thermal and Metallurgical Coal

Europe – Declining Domestic Coal Production F

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Russia Export to EU (2012) 60.3mt

% Total of EU Imports 33%

Calorific Value (Kcal/kg) 6,177

Cash Cost (2013e) (85th percentile, FOB) US$100/t

Australia

Indonesia

Russia

USA

Colombia

South Africa

Source: Deutsche Bank May 2013 Report; Euracoal (2012)

USA Export to EU (2012) 35.8mt

% Total of EU Imports 19%

Calorific Value (Kcal/kg) 6,676

Cash Cost (2013e) (85th percentile, FOB) US$132/t

Colombia Export to EU (2012) 58.7mt

% Total of EU Imports 32%

Calorific Value (Kcal/kg) 5,945

Cash Cost (2013e) (85th percentile, FOB) US$60/t

South Africa Export to EU (2012) 13.8mt

% Total of EU Imports 8%

Calorific Value (Kcal/kg) 6,141

Cash Cost (2013e) (85th percentile, FOB) US$62/t

Indonesia Export to EU (2012) 9.4mt

% Total of EU Imports 5%

Calorific Value (Kcal/kg) 5,150

Cash Cost (2013e) (85th percentile, FOB) US$64/t

Australia Export to EU (2012) 2.0mt

% Total of EU Imports 1%

Calorific Value (Kcal/kg) 6,008

Cash Cost (2013e) (85th percentile, FOB) US$87/t

Imports from Russia, Colombia, the US and others are fundamental for European thermal coal supply…

…security of supply, coal quality and price are key considerations for power generators

Increasing Reliance on Imported Thermal Coal F

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Global Coal Producer Comparables F

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Important Information This presentation has been prepared as a summary only, and does not contain all information about Prairie Downs Metals Limited’s (“Prairie”) assets and liabilities, financial position and performance, profits and losses, prospects, and the rights and liabilities attaching to Prairie’s securities. The securities issued by Prairie are considered speculative and there is no guarantee that they will make a return on the capital invested, that dividends will be paid on the shares or that there will be an increase in the value of the shares in the future. Prairie does not purport to give financial or investment advice. No account has been taken of the objectives, financial situation or needs of any recipient of this report. Recipients of this report should carefully consider whether the securities issued by Prairie are an appropriate investment for them in light of their personal circumstances, including their financial and taxation position.

Forward Looking Statements Some of the statements contained in this report are forward looking statements. Forward looking statements include but are not limited to, statements concerning estimates of coal tonnages, expected costs, statements relating to the continued advancement of Prairie’s projects and other statements which are not historical facts. When used in this report, and on other published information of Prairie, the words such as “aim”, “could”, “estimate”, “expect”, “intend”, “may”, “potential”, “should” and similar expressions are forward-looking statements. Although Prairie believes that its expectations reflected in the forward-looking statements are reasonable, such statements involve risk and uncertainties and no assurance can be given that actual results will be consistent with these forward-looking statements. Various factors could cause actual results to differ from these forward looking statements include the potential that Prairie’s projects may experience technical, geological, metallurgical and mechanical problems, changes in product prices and other risks not anticipated by Prairie.

Competent Persons Statement The information in this presentation that relates to Exploration Results and Mineral Resources was extracted from Prairie’s ASX announcements dated 14 February 2013 titled “Maiden Coal Resource of 1.576Bt at Lublin Coal Project” and 31 October 2013 titled “Initial Coal Quality Testing Indicates Mettallurgical Coal Potential”, available to view on the company’s website at www.pdz.com.au. The information in the original ASX announcements that related to Exploration Results and Mineral Resources was prepared and first disclosed under the JORC Code 2004. It has not been updated since to comply with the JORC Code 2012 on the basis that the information has not materially changed since it was last reported. Information in this presentation that relates to Exploration Results and Mineral Resources is based on information compiled by Dr Richard Lowman (an employee of independent consultant Wardell Armstrong LLP which owns Wardell Armstrong Limited) who is a Fellow of the Geological Society of London. Dr Lowman 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 under the 2004 Edition of the Australasian Code for reporting of Exploration Results, Mineral Resources and Ore Reserves. Dr Lowman consents to the inclusion of the data in the form and context in which it appears. Front Cover Photo: Not property of Prairie Downs Metals Limited. For illustration purposes only. Photographs sourced as follows: Page 3: http://tcktcktck.org; http://www.portgdansk.pl/ Page 4: http://www.lw.com.pl/en,2,s18,history.html Page 6 http://www.gbpbp.com.pl/en-GB/mining_.html ; http://www.lw.com.pl/ Page 7: mining.cat.com Page 20: www.topazimpex.com

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Prairie Downs Metals Limited

Head Office Level 9, BGC Centre 28 The Esplanade PERTH WA 6000 AUSTRALIA P: +61 8 9322 6322 F: +61 8 9322 6558

London Office Unit 1C, Princes House 38 Jermyn Street LONDON, SW1Y 6DN UNITED KINGDOM P: +44 207 478 3900 F: +44 207 434 4450

Poland Office PD CO Sp z o.o. Rondo ONZ 1, Floor 5A 00-124 WARSAW POLAND

www.pdz.com.au info@prairiedownsmetals.com.au

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