mcoal coal july investor slides

A N O V A D X C O M P A N Y

July 2010

Confidential Information - Not for Public Distribution 1Confidential Information - Not for Public Distribution

FORWARD LOOKING STATEMENTS

This PowerPoint presentation includes certain statements that constitute “forward-looking statements” within themeaning of Section 27A of the United States Securities Act of 1933 and Section 21E of the United Satesmeaning of Section 27A of the United States Securities Act of 1933 and Section 21E of the United SatesSecurities Exchange Act of 1934. These statements appear in a number of places in this PowerPoint presentationand include statements regarding our intent, belief or current expectation and that of our officers and directors.Such forward –looking statements involve known and unknown risks and uncertainties that may cause our actualresults, performance or achievements to be materially different from any future results, performance orachievement expressed or implied by such forward-looking statements. When used in this PowerPointpresentation, words such as “believe”, “anticipate”, “estimate”, “project”, “intend”, “expect”, “may”, “will”, “plan”,“should”, “would”, “contemplate”, “possible”, “attempts”, “seeks” and similar expressions are intended to indentifythese forward-looking statements. These forward-looking statements are based on various factors and werederived utilizing numerous assumptions that could cause our actual results to differ materially from those in theforward-looking statements. Accordingly, you are cautioned not to put undue reliance on these forward-lookingstatements Forward looking statements include among others statements regarding our expected financialstatements. Forward-looking statements include, among others, statements regarding our expected financialperformance in future periods, our plan of operations and our business strategy and plans or budgets.

We assume no obligation to update or to publicly announce the results of any change to any of the forward-lookingstatements contained or incorporated by references herein to reflect actual results, future events orde elopments changes in ass mptions or changes in other factors affecting the for ard looking statementsdevelopments, changes in assumptions or changes in other factors affecting the forward-looking statements.

Unless indicated otherwise within this presentation, no work has been done to classify the coal resourcesmentioned in this presentation as a current resource estimate as defined in section 1.2 and section 1.3 of NI 43-101 and is treated as an estimate only and therefore cannot be relied upon.

Confidential Information - Not for Public Distribution 2

INTRODUCTION

MCoal Corporation is a Nevada based, wholly‐owned subsidiary of Novadx VenturesCorp. (TSX‐V: NDX / OTC: NDXFF) focused on acquiring and operating high‐value,specialty coal projects in the Appalachian coal district of the United States. MCoalrecently commenced production at the Rosa Mine, a metallurgical coal minelocated in Alabama. MCoal is currently ramping production to 10,000 tons permonth at a selling price of US$150 per tonmonth at a selling price of US$150 per ton.

MCoal entered into letters of intent, subject to financing to make three acquisitions:the operating Flatwoods Mine located in Kentucky, currently producing 23,000the operating Flatwoods Mine located in Kentucky, currently producing 23,000ton per month of a high quality stoker coal selling at an average price of US$80per ton, the fully permitted and bonded Rex No.1 Mine located in Tennessee with32.2 million tons of measured and indicated and 27.6 million tons of inferred

f l i bl f h ili l k d h D d P jresources of a coal suitable for the silicon metal market and, the Dade Projectlocated in Georgia with historic resource estimates of 172M tons of primarilymetallurgical coal in place.

MCoal requires $40 million in equity financing to complete these acquisitions.


MCOAL’S LONG TERM GOAL

Continue implementing its acquisition growth strategy to become a recognizedproducer of high quality, specialty coals sold to multiple industrial coal marketsincluding:

Metallurgical Coal: Customers purchasing Rosa Coal for $150 per ton• Made into coke which is sold to steel foundries who combine it with iron ore and other materials to make

steelsteel

• The source of carbon which gives steel its strength. For every ton of steel produced, typically 0.6 of a ton of metallurgical coal is required.

Activated Carbon: Customers purchasing Rosa Coal for $150 per tonp g $ p• Uses include: gas purification, gold purification, metal extraction, water purification, air filtering and

sewage treatment

Silicon Metal: Customers paying up to $190 per ton for a sized product• Specialty coal used in manufacture of silicon metal for photovoltaic cells, silicon chips and alloyed metals

Industrial Stoker Coal: Customers purchasing Ikerd coal for between $70 to $100 per ton• A high quality and highly valued, specialty thermal coal product that is primarily sold to the food industry

and to other customers in the cement, paper and utility businesses.


MCOAL’S SHORT TERM GOALS

• Complete $40 million financing and list MCoal on TSX.

• Increase production of specialty coal products from a projected 175,000 tons in 2010 to 800,000 tons in 2011 and 1,000,000 tons in 2012;

• Increase revenue from a projected $17 million in 2010 to $100 million in 2011 and $143 million in 2012;

• Prove up over 100 million tons of NI 43‐101 compliant specialty coal resources by the end of 2011; and

• Continue evaluating and acting upon a pipeline of additional high quality coal acquisition opportunities that complement the current portfolio of projects.


EXPERIENCED MANAGEMENT TEAM

• Neil MacDonald ‐ President/CEO Novadx, CEO MCoal– 18 years as an investment banker with Raymond James Canada and Blackmont Capital Corp.

– a member of the TSX Venture Exchange local advisory committee.

• Robert Payne ‐ Chief Operating Officer, MCoal– 24 years of direct and senior experience in both underground and surface coal mine development, construction,

operations and management with a B.S. Mine Engineering degree in 1986 from the University of Alabama .

– Previously with Drummond Coal Corp he is highly respected in the local mining community.

• Mark Reynolds – Director of Coal Marketing, MCoal– 25 years’ experience in mining and transport operating logistics, instrumental role in the founding of Western Canadian

Coal Corporation

– 17 years’ experience in project finance as a stock broker

• Fred Beane – Consultant, Land acquisition & Coal Marketing , MCoal– 30 years’ experience in the Appalachian coal industry, has assembled and arranged MCoal’s projects portfolio .

– responsible for extending land position and arrange preferential coal marketing contracts

J D l C R Mi S i MC l• J. Doyle Crump – Rosa Mine Supervisor , MCoal– 35 years’ experience in coal mining operations and coal transportation in Alabama

– Local to the area, and has many contacts within the coal mining community.


MANAGEMENT TEAM (CONTINUED)

• Phillip Prince – Property Acquisition and Land Manager , MCoal– With 16 years’ of experience abstracting, researching and analyzing land and mineral titles.

– Is responsible for negotiating acquisition agreements of surface mining rights for MCoal.

Proposed acquisitions will complement existing management with highly experienced individuals local to the area including:

• Frank H. Ikerd III –Managing Member, Ikerd Group of Companies– Frank H. Ikerd III is the third generation Coal mining executive with over 40 years of direct coal mining experience as

owner/operator.

– an established member of the Kentucky community, with extensive relationships across many business sectors.

– Sold previous coal mining company to Peabody.

• TimWebb –Managing Member, Tiacme, LLCTimWebb Managing Member, Tiacme, LLC– 30 years’ of experience as a mining consultant and owner/operator of several coal companies.

– a highly respected mining engineer with global experience (US, UK, Mexico) in underground coal mining.


TOTAL POTENTIAL COAL RESOURCES

Rosa Mine (Alabama) – Owned and operated ($65 cash cost per ton)– Operating Mine with an estimated 6.2 million tons measured and indicated

and 2.0 million tonsof inferred coal resources.

– NI 43‐101 compliant proven coal reserve of 652,000 tons

Flatwoods Mine (Kentucky) – Acquisition ($52 cash cost per ton)– Operating mine with an estimated 7.13 million tons of coal resources.

– Significant expansion potential

Rex No 1 Mine (Tennessee) Acquisition ($68 cash cost per ton)Rex No 1 Mine (Tennessee) – Acquisition ($68 cash cost per ton)– Permitted and bonded mine with an estimated 32.2 million tons measured

and indicated and 27.6 million tons of inferred coal resources

– significant expansion potential

Elk M i Li l B h C k d B b (K k ) A i i iElk Mountain, Little Bushy Creek and Buncomb (Kentucky) ‐ Acquisition– 3.38 million tons across additional three permitted and bonded but idle

mines.

Dade Project (Georgia) – Option to Purchase Mineral Rights.– historical resources estimates of 172 million tonsof met and thermal coal

– historical indication of over 200 million tonsof iron ore.

Total potential in situ coal resources of over 250 million tons1

Confidential Information - Not for Public Distribution

pwith expansion potential

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ROSA MINE ‐ ALABAMA

• currently 100% owned producing mine; previous investor has a right to convert investment into a 25% JV interest.

• grass roots project started in October 2008.

• commenced surface production of metallurgical coal on April 19, 2010.

• 652,000 tons of proven 43‐101 compliant reserves with an estimated 8.2 million f l ltons of coal in place.

• currently selling to domestic customers in the coking coal and activated carbon businesses at an average price of US$150 per ton.

e panding prod ction from a projected 45 000 tons in 2010 to 140 000 tons in• expanding production from a projected 45,000 tons in 2010 to 140,000 tons in 2011 and 300,000 tons in 2012 through 3 mining phases.

• currently permitting onsite coal processing facility to increase quality control and reduce production costs.reduce production costs.


ROSA MINE ‐ ALABAMA

• Calvert & Marsh Coal Co. Inc. of Oneonta, Alabama mined the Rosa coal seamusing “rim cut” strip mining techniques from 1965 to 1978 and sold the Rosa coalto two existing coking facilities in Birmingham.

• Only the fringes of the mountains overlaying the Rosa coal seam were mined,leaving behind a stripped high‐wall ideally suited for auger mining and a large

d dunderground reserve.


MCOAL’S THREE PHASE ROSA MINE PLAN

10 Year mine life planned over three phases

Phase 1: Auger MiningPhase 1: Auger MiningPhase 2: Auger and Strip MiningPhase 3: Underground Mining

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ROSA MINE – ALABAMA

Rosa Coal Quality

WashedWashed

(Dry Basis)Total Moisture % 8.0

Ash % 1.7 1.8Ash % 1.7 1.8

Volatiles % 25.1 27.2

Fixed Carbon % 64.7 70.3

Sulphur % 0.61 0.66

BTU/lb 14 000 15 200BTU/lb 14,000 15,200

Free Swelling Index 9

Hardgrove Index 67


REX NO.1 MINE ‐ TENNESSEE

• LOI signed with Tiamce LLC to acquire the Rex No. 1 Mine in consideration of US$2,500,000 in cash plus US$2,500,000 payable in shares at a 10% discount to the financing price.p p y g p

• Fully permitted and bonded underground coal mine encompassing 31,000 acres ready to commence production of high quality coal primarily for the silicon metal industry.

• The Rex Coal seam has (since 2004) been in demand by silicon metal foundries due to its high quality and low iron and titanium contentquality and low iron and titanium content.

• Silicon metal coal typically sells at $190 per ton for a sized product.

• Current resource estimate of 32.2 million tonsmeasured and indicated and 27.6 million tonsinferred resources in place with an estimated recoverable of 30 million tons.

• commencing production in January 2011.

• expanding production from 300,000 tons in 2011 to 500,000 tons in 2012 with and expected mine life of over 25 years

• An NI 43‐101 compliant resource report has been initiated• An NI 43‐101 compliant resource report has been initiated.


REX NO.1 MINE RESOURCES

Rex Coal Quality

As received(Dry Basis)

Washed (Dry Basis)

Ash % 4.88 1.90

Volatiles % 38.31 39.25

Fixed Carbon % 56.81 58.85

Sulphur % 0.92 0.77

BTU/lb 14,358 14,850

Iron Oxide % 0.55 0.24

Titanium Oxide % 0.046 0.007


IKERD MINING LLC ‐ PROPERTIES

• LOI signed with Ikerd Mining LLC to acquire the Flatwoods, Elk Mountain, Little Bushy Creek and Buncomb Mine assets in consideration of US$14,000,000 in cash and assuming

$ d b fUS$10,000,000 in mining equipment debt financing.

• LOI signed with Ikerd Terminals LLC and Ikerd Transportation LLC to acquire all assets associated with a coal transportation, processing and rail load out facility (Norfolk & Southern Rail) that has been operating for over 60 years in consideration of US$2 million in cash plus US$2,000,000 payable in shares at a 10% discount to the financing price.

• The transaction provides MCoal with a turn key fully operational and profit generating coal mine producing and average of 23,000 tons of high quality industrial stoker coal at an average price of $80/ton. p $ /


IKERD MINING LLC

• Flatwoods Mine – Production – Coal is mined at the Flatwoods and Dry Branch Mines (collectively referred to as

“Flatwoods”), in Clay County, Kentucky

– Commenced production of high quality industrial stoker coal in April 2008

– Coal is surface mined at a low 8:1 strip ratio on the Hazard 5a and by using contour and auger mining methods on the Hazard 4 seam.auger mining methods on the Hazard 4 seam.

– 3.35 million tons of permitted reserves plus an additional 3.78 million tons of lease controlled reserves in place.

– Exploration and leasing of additional resources in the immediate area is ongoing.

– Expanding production from 300,000 tons in 2010 to 420,000 tons in 2011.

– The industrial stoker coal produced is high quality and sold primarily to the food processing customers. Other customers include cement, paper and utility businesses.


IKERD MINING LLC

Hazard 5A Coal Quality:

As received As Received(Dry Basis)

Total Moisture % 4.15

Ash % 8.07 8.42Ash % 8.07 8.42

Sulphur % 0.72 0.75

BTU/lb 13264 13839


IKERD MINING

• Elk Mountain, Little Bushy Creek and Buncomb Mines ‐ Idle– 3 additional fully permitted and bonded properties located in Clay, Knox and Owsley3 additional fully permitted and bonded properties located in Clay, Knox and Owsley

counties respectively in Kentucky.

– encompass an aggregate 559 coal acres with exploration and leasing of additional acreage ongoing.

t f 3 412 240 t f i th H d 5A H d 4 Bl G d– an aggregate of 3,412,240 tons of reserves in the Hazard 5A, Hazard 4, Blue Gem and Jellico seams.

– coal mining permits are getting harder to obtain and these 3 projects offer MCoal an excellent opportunity for future expansion.

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DADE COUNTY EXPLORATION ‐ GEORGIA

• in final stages of negotiating an option to acquire all mineral rights to approximately 21,000 acres located in Dade county in Georgia.

• option cost is $75,000 for 18 months

• option exercise price is US$5 million payable US$2.1 million in cash and the balance in shares at the share price when the option is exercised.

• mineral rights include four seams Aetna (low vol met coal) Dade (mid vol met coal)• mineral rights include four seams, Aetna (low vol met coal), Dade (mid vol met coal), Rattlesnake (mid vol met coal) and the Mill Creek (thermal coal) which where discovered in the mid to late nineteenth century

• historical resource of and aggregate 172 million tons: 112 million tons of metallurgical coal and 60 million tons of thermal coaland 60 million tons of thermal coal.

• exploration and delineation of 43‐101 mineral resource by end of 2011.


DADE PROJECT COAL QUALITY BY SEAM

Aetna Dade Rattlesnake Mill Creek

(As Received) (As Received) (As Received) (As Received)(As Received) (As Received) (As Received) (As Received)

Coal Category Metallurgical Metallurgical Metallurgical Thermal

Historica Resource Estimate 23 M 50 M 39 M 60 M

Total Moisture % 8.39 5.52 0.92 0.92

Ash % 2.51 3.64 4.84 12.18

Volatiles % 22.40 25.63 27.98 22.30

Fixed Carbon % 66.70 65.21 66.26 64.60

Sulphur % 0.73 0.94 0.98 0.72

BTU/lb 14,386 14,357 Unknown 13,761

Free Swelling Index 9 9 Unknown NA

Hardgrove Index 88 83 Unknown NA


PRO FORMA FINANCIAL PERFORMANCE

$160

$180

ons

$ 00

$120

$140

$160 Millio

$60

$80

$100 Revenue

EBITDA

Net Income

$‐

$20

$40

2010 (6 months) 2011 2012 2013

Revenue $ 16,570,000 $ 101,564,000 $143,541,000 $ 158,031,600 EBITDA $ 3,875,071 $ 43,774,000 $ 60,459,497 $ 61,046,613 Net Income $ 1 697 543 $ 25 913 877 $ 35 930 914 $ 35 899 004


Net Income $ 1,697,543 $ 25,913,877 $ 35,930,914 $ 35,899,004

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FINANCING REQUIREMENT

Description CashDescription CashAcquisition of Ikerd mining assets $16,000,000Acquisition of Tiacme LLC (Rex No. 1 Mine) $2,500,000Rex No. 1 Mine development and start‐up $10,000,000

Dade Project option $75,000Exploration of Dade Project $1,000,000

Rosa Wash Plant $3,000,000Sub total $32 575 000Sub total $32,575,000Working Capital $7,425,000Total Funding Requirements $40,000,000


PROPOSED SHARE STRUCTURE

Pricing Range

$1 50$1.50

# Shares %

MCoal shares outstanding (Post Split) 26,427,650 46.8%Shares to be Issued on closing acquisitions at 10% discount 3,333,333 5.9%

Total shares O/S pre financing 29,760,983 52.7%/ p g , ,

Financing (US$40,000,000) 26,666,667 47.3%

Total shares O/S post financing 56 427 650 100 0%Total shares O/S post financing 56,427,650 100.0%

Market Cap $84,641,000


NPV OF FREE CASH FLOW (PRE FINANCING)

Discount Rate NPV NPV/Share8% $ 188,213,260 $7.1210% $ 165 846 637 $6 2810% $ 165,846,637 $6.2815% $ 122,109,460 $4.6220% $ 90,806,406 $3.4425% $ 67,798,884 $2.5725% $ 67,798,884 $2.5730% $ 50,480,221 $1.9134% $ 39,750,000 $1.50


MCOAL VALUATION METRICS

Comparable Analysis

Industry Specific Comparable Stocks

SymbolCurrent Share Price

Shares O/S

(millions)

MarketCap

(00,000’s)

NAV (8%) per share

Premium (Discount) to

NAVP/E P/CFPS EV/EBITDA

2011 2012 2011 2012 2011 2012Grand Cache Coal GCE T $5.80 96.5 $560 $5.08 14.2% 4.1 3.8 3.6 3.8 2.8 2.6 Teck Resources TCK.B T $35.60 589.1 $20,972 $46.40 ‐23.3% 7.3 8.5 4.8 5.3 2.6 3.0 Western Coal WTN T $4.22 251.0 $1,059 $4.48 ‐5.8% 3.8 3.8 3.0 2.9 2.1 2.1

Average ‐5.0% 5.0 5.4 3.8 4.0 2.5 2.6

MCoal Corp $1.50 56.4 $84.6 $3.13 ‐52.1% 3.3 2.4 2.8 1.9 0.9 0.5


FOR FURTHER INFORMATION

Please Contact:

Neil MacDonaldNeil MacDonaldPresident/CEO Novadx and CEO MCoalEmail: [email protected]: +1 (604) 633-2776 ext 23Cell: +1 (604) 721-2600

Gavin McMillanCorporate Communications/DevelopmentCorporate Communications/DevelopmentEmail: [email protected]: +1 (604) 633-2776 ext 30Cell: +1 (604) 613 8655

Or visit our website at: www.novadx.com


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mcoal coal july investor slides

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