Mission: - To become the world’s leading low cost, vertically-integrated producer of pure magnesium and magnesium alloy

AGM Presentation November 2012

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Disclaimer

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This presentation has been prepared by and issued by China Magnesium Corporation Limited (“CMC”) to assist it in informing

interested parties about the Company and its progress. It should not be considered as an offer or invitation to subscribe for or purchase

any securities in the Company or as an inducement to make an offer or invitation with respect to those securities. No agreement to

subscribe for securities in the Company will be entered into on the basis of this presentation.

You should not act or refrain from acting in reliance on this presentation material. This overview of CMC does not purport to be all

inclusive or to contain all information which its recipients may require in order to make an informed assessment of the Company’s

prospects. You should conduct your own investigation and perform your own analysis in order to satisfy yourself as to the accuracy and

completeness of the information, statements and opinions contained in this presentation and making any investment decision.

Neither the Company nor its advisers have verified the accuracy or completeness of the information, statements and opinions contained

in this presentation. Accordingly, to the maximum extent permitted by law, the Company and its officers, employees, advisers and

agents make no representation and give no assurance, guarantee or warranty, express or implied, as to, and take no responsibility and

assume no liability for, the authenticity, validity, accuracy, suitability or completeness of, or any errors in or omission, from any

information, statement or opinion contained in this presentation.

Reports and Announcements can be accessed via the CMC website – www.chinamagnesiumcorporation.com

Forward-Looking Statements:

This presentation includes certain “Forward-Looking Statements”. All statements, other than statements of historical fact, included

herein, including without limitation, statements regarding forecast cash flows, future expansion plans and development objectives of

CMC are forward-looking statements that involve various risks and uncertainties. There can be no assurance that such statements will

prove to be accurate and actual results and future events could differ materially from those anticipated in such statements.

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Key developments since FY2012

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Practical completion of 20,000 tpa plant (Dec11)

Commenced production of magnesium/alloy (Oct12)

Further land rights secured (Oct12), available for second phase expansion

or possible further value-adding downstream processing

Acquired dolomite (magnesium ore) quarry (Apr12) and commenced

dolomite production (Jun12)

Agreement to acquire established, profitable ferrosilicon producer (Nov11)

awaiting change of business licence from the Industrial and Commercial

Bureau of Zhongwei

$5.3m capital raisings at a premium to market (up to 62%) (Nov11, Jun12)

Strong cash position - $5.1m as at end of Sep 2012 For

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Magnesium – 21st century structural metal

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Stronger and lighter structural metal

33% lighter than aluminium and 75% lighter than steel

Used in Mg alloy die casting (auto/aircraft & electronics) for its light weight

Also used for producing aluminium alloys, steel and titanium

Roskill (Aug 2010) forecast consumption to grow at ~6%pa on average,

particularly in the automotive sector (~10%pa)

Chinese government's 12th 5 year plan targets magnesium as a key metal

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Expected increase in Mg content per vehicle

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“Engineers and scientists at General Motors Co believe that they are

making major strides toward lighter vehicles by developing a way to expand

the use of magnesium in auto parts.” *

“By 2020, magnesium will be able to take out 15% of the weight of a

vehicle, leading to fuel savings of 9% to 12%, according to the US

Automotive Partnership” *

* From “GM test magnesium sheet metal to make cars lighter”, Reuters, 23 Oct 2012

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China: Growing demand, restricted supply

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China accounts for:

around 85% of global primary supply

around 30% of global consumption (and growing consumption)

Dominated world production using the pidgeon process – a simple, cheap

thermal process – at the expense of capital intensive electrolytic processes

used in the West

The Chinese government is rationalising the Mg industry:

15,000 tpa minimum capacity for existing plants

50,000 minimum tpa capacity for new permits (not applicable to CMC)

CMC set to benefit because it already has a permit to 105,000tpa For

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CMC’s early mover advantage

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Pingyao magnesium project (91.25% CMC)

Located in Shanxi Province of Northern China

One of the largest Mg producing regions in the world with access to

highly skilled labour, low-cost feedstock and infrastructure

CMC already has key permits to expand to 105,000 tpa

Already awarded ISO GB/T 9001-2008 quality certification

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Plant locations

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Location of magnesium plant in Pingyao (B) (dolomite quarry located 30km from Pinyao operations) and

ferrosilicon plant in Zhongwei (C) northern China - all accessible via sealed road and/or rail

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Pidgeon process for Mg production

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Furnace in production

Dolomite (similar to limestone) is heated to remove carbon and leave magnesium

and calcium oxides

Ferrosilicon is added and, under high temperature, reduces magnesium oxide to

pure magnesium vapour, which is condensed to solid magnesium “crown”.

The crown is melted and cast into pure magnesium ingots. Small amounts of other

metals (mainly aluminium and zinc) can be added to the molten magnesium to form

alloys

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Mg Production Process

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Discharging Crowns

Mg Ingot Briquettes

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Mg Plant Facilities

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Coal-Gas Facility Rotary Kiln

Waste Heat

Recovery Boiler &

Dust Collector

Jet Vacuum System

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Mg Plant Facilities

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Ball Mill Water Cooling

Towers

Reduction Ovens

Retorts

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Mg Plant Facilities

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Casting Machine Refinery furnaces

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Vertical integration and expansion strategy

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Downstream ...

First phase expansion brings higher-value alloying capacity at minimal

additional marginal cost

Use of additional land may include further downstream processing

Upstream (two of the three primary upstream components) ...

Acquired dolomite quarry – raw magnesium ore supply

Proposed acquisition of ferrosilicon business – main cost input

CMC may also consider acquisition of suitable coal suppliers

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Vertical integration and expansion strategy

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Expansion …

Key environmental permits in place to expand production to 105,000tpa

“Preferred Project” status from Shanxi provincial government

Further expansion intended to proceed subject to optimum use and

availability of CMC’s resources in light of other opportunities

Water rights secured to enable expansion to 105,000tpa

90mu (~60,000m2) of land secured, earmarked for either next expansion

phase or further downstream processing

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Quarry acquisition and dolomite production

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Located approximately 30km from magnesium plant

Dolomite is the magnesium bearing ore – the largest raw input by volume

Current and previous dolomite requirements were supplied by the quarry

and expected to supply expanded production

From quarry level Looking down on quarry

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Dolomite Quarry

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Blast drilling Loading

Delivering to crushers Sizing products

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Ferrosilicon business

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Main cost input for magnesium production

Attractive acquisition terms

Stand-alone producer - 55,000 tpa capacity of FeSi will be sufficient to

meet CMC’s FeSi needs through to completion of phase two

Currently supplies FeSi to end users (including CMC) and currently exports

most of its production to the steel industry in Japan & Korea

Replacement cost of the ferrosilicon production facility has been estimated

at approximately CNY100m (A$15m)

Opportunity brought to the attention of CMC’s executive director as a result

of long-term relationships and contacts within China

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Tianda Ferrosilicon Plant

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Office Building 110KV Substation

Final Products Pouring

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Strong backers and balance sheet

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$5.3m capital raisings at a premium to market from Australian and Asian-

based investment groups ($0.30-0.35 per share)

Included $4 million (in June 2012) at significant premiums of up to 62% in

historically difficult stock market conditions

Impressed by what we have achieved to date, they have backed our team

to deliver substantial returns into the future

Strong cash position - $5.1m as at end of Sep 2012

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Team has delivered in tough conditions

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Acquired and renewed the mining license for the dolomite quarry

CMC mining licence was renewed at a time when quarries in the area were

being rationalised. CMC has preferred project status and the mine licence

was acknowledged as critical to venture success. The result of the

rationalisation has seen the number of quarries reduced from 22 to 5,

including the CMC quarry

Secured an agreement and key approvals to acquire the ferrosilicon

business from a state-owned power company

Completed the upgrade and first phase expansion of the magnesium

project at bare minimum cost to CMC

Raised new capital at a significant premium to prevailing market price

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Summary: Significant progress since FY2011

Completed upgrade and first phase capacity expansion (20,000tpa)

Commenced magnesium/alloy production

Acquired dolomite quarry and commenced production

Agreement to acquire established ferrosilicon producer

Additional land-use and water rights secured

Raised new capital at significant premiums to market

Positioned to exploit growing demand for a light weight, 21st century structural metal – magnesium

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