Issue of Shares

ANNOUNCEMENT 7 AUGUST 2012

Coal of africa limited

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

Coal of Africa Limited ("CoAL" or the "Company") advises that it has today issued 80,570,166 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 which was announced to the market on 6 August 2012.

Application has been made for the Shares to be admitted to trading on the AIM market of the LondonStock Exchange ("Admission"). Admission is expected to become effective on or around 9 August 2012. The shares will rank pari passu with the Company's existing ordinary shares of nil par value. Application will also be made to the Australian Securities Exchange and the Main Board of the JSE Limited.

Following Admission there will be 766,042,402 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