Prophecy Resource Corp. has signed an agreement securing
the loading of and the capacity to transport by rail 1.5 million tons of coal
annually from its Ulaan Ovoo coal project, with the option to increase capacity
based on availability. The loading point will be the Sukhbaatar station, 120km
by road east of Prophecy”s 208.8 million-ton mine. It is also only 8 km south
of the Russian/Mongolian Naushki border linking with the Trans-Siberian
Railroad that services Russia“s
largest coal export facilities at Vladivostok
and Vanino ports at the eastern seaboard.

The Mongolian railroad is also connected to China“s Erenhot port, which is 1,093 km south
from Sukhbaatar and opens Ulaan Ovoo to China, the largest consumer of coal
in the world. 

On May 21, Prophecy contracted Leighton Asia Ltd. to
produce 250,000 tons of coal at Ulaan Ovoo in 2010, with further plans to mine
2 million tons of coal in 2011. Having established the mine plan and secured
rail transport, Prophecy is finalizing a truck leasing agreement to provide
hauling of coal from mine site to Sukhbaatar, thus rounding up the entire
transportation logistics to Chinese and Russian markets.