Issue of Shares

ANNOUNCEMENT 13 SEPTEMBER 2012

Notice issued under section 708A(5)(e) of the Corporations Act 2001 (Cth)

Further to the announcements of 6 August 2012 and 11 September 2012, Coal of Africa Limited ("CoAL" or the "Company") advises that it has issued 34,908,632 fully paid ordinary shares in the Company ("Shares"), pursuant to the placing agreement between the Company, Deutsche Bank AG, Investec Bank plc and Investec Bank Limited.

Application has been made for the Shares to be admitted to trading on the AIM market of the London Stock Exchange ("AIM") and the Main Board of JSE Limited ("JSE"). Admission to trading on AIM became effective on 12 September 2012 and admission to trading on the JSE is expected to occur on or around 13 September 2012. The shares will rank pari passu with the Company's existing ordinary shares of nil par value. Application for quotation of the Shares will also be made to the Australian Securities Exchange.

Following Admission there will be 800,951,034 shares in issue.

In accordance with the requirements of section 708A(6) Corporations Act 2011 (Cth) (Corporations Act), CoAL notifies ASX that:

a) the Shares were issued without disclosure to investors under Part 6D.2 of the Corporations Act;

b) this notice is being given under section 708A(5)(e) of the Corporations Act;

c) as at the date of this notice, CoAL has complied with:

i) the provisions of chapter 2M of the Corporations Act (other than section 319 in relation to a financial year ended in the calendar year 2004) as they apply to CoAL; and

ii) section 674 of the Corporations Act; and

d) as at the date of this notice, there is no information that is "excluded information" required to be set out in this notice by virtue of sections 708A(7) and 708A(8) of the Corporations Act.

AUTHORISED BY:

John Wallington

Chief Executive Officer

For more information contact:

www.coalofafrica.com