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FSE - Firestone Energy Limited - LOI for sale of 1.2 million tonnes of "A" grade coal FIRESTONE ENERGY LIMITED (Registration number: ABN 058 436 794) (SA company registration number: 200/023973/10 Share code on the JSE: FSE Share code on the ASX: FSE ISIN: AU000000FSE6 ("FSE" or "the Company") LOI FOR SALE OF 1.2 MILLION TONNES OF "A" GRADE COAL Firestone Energy Limited (ASX/JSE : FSE) is pleased to announce that its Joint Venture with Sekoko Resources has received a firm Letter of Intent "LOI" from Stig Jiangsu Light & Textile Imp. & Exp. Co. Ltd "Stig Jiangsu", a member of the Sainty International Group. The LOI is for the purchase of a regular volume of 1.2million tonnes per annum of prime coal by way of shipments commencing in late 2012. There is a potential to increase this volume to 2.4million tonnes per annum depending on the availability of rail capacity to Richards Bay Coal Terminal. The coal which is the subject of the transaction will be the higher "A" grade coal which will be extracted from the Company`s Smitspan property and which will have a calorific value greater than that required by Eskom. The transaction is priced relative to a recognised index and revenue, this transaction has attracted a premium price for the higher calorific value, low ash, low phosphate coal product. It is the intention that the FSE/Sekoko JV and Stig Jiangsu will progress the LOI to a binding agreement within 90 days. The joint venture has received a number of inquiries for the purchase of coal which is surplus to the existing agreement with Eskom. This LOI is tangible evidence of the marketability of the joint venture`s coal and underpins the progress which is being made in the development of a viable coal company. Yours sincerely Firestone Energy Limited David Perkins Chairman www.firestoneenergy.com.au About Sekoko Resources Sekoko Resources (Pty) Ltd is a South African-based black-owned energy and minerals company developing the coal, magnetite iron ore and PGMs Projects in the Limpopo Province of South Africa. This includes a significant exploration program and development of the Waterberg Coal Joint Venture Project based on significant Coal Zone Resources. Sekoko is targeting to commence operations in 2012, thus forming the basis for developing a global coal business. About Firestone Energy Firestone Energy Limited is an independent, Australian exploration and development company listed on the Australian Stock Exchange Ltd (ASX) and the Johannesburg Stock Exchange (JSE). Firestone Energy has entered into a Joint Venture with Sekoko Resources (Pty) Ltd through which Firestone Energy has acquired the right to 60% participation interests in the Waterberg Coal Project located in Lephalale area, Limpopo Province, South Africa. The first stage of the project is to develop the Smitspan mine which has a substantial measured thermal coal resource and to develop the Vetleegte mine which is a substantial metallurgical coal deposit. Firestone Energy is committed to becoming a profitable independent coal and energy producer at its projects in South Africa, thereby making a substantial contribution to the social and economic development of the Lephalale area and South Africa. Corporate Details ASX: FSE JSE: FSE Issued Capital: 2,793 million ordinary shares Major Shareholders: Sekoko Resources (Pty) Ltd BBY Nominees Ltd Colbern Fiduciary Nominees Ltd Bell Potter Nominees Ltd Directors and Officers Non Executive Directors: David Perkins (Chairman) Dr Pius Kasolo Colin McIntyre Executive Directors: Sizwe Nkosi Company Secretary: Jerry Monzu Contact: Suite B9, 431 Roberts Road Subiaco, Western Australia 6008 Tel: +61 (0)8 9287 4600 Pretoria 27 July 2011 Sponsor River Group Date: 27/07/2011 08:32:00 Supplied by www.sharenet.co.za Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited (`JSE`). The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct, indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on, information disseminated through SENS.
