ECX Eastcoal

THIS NEWS RELEASE IS INTENDED FOR DISTRIBUTION IN CANADA AND ANY OTHER
JURISDICTION IN WHICH IT IS LAWFUL TO DISTRIBUTE THIS NEWS RELEASE AND IS NOT
AUTHORIZED FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR
DISSEMINATION IN THE UNITED STATES


EastCoal Inc. (TSX VENTURE:ECX)(AIM:ECX) (the "Company" or "EastCoal") is
pleased to announce the closing of its previously announced brokered private
placement (the "Placing") of 351,900,000 common shares (the "Placing Shares") of
the Company, primarily with existing and new institutional investors, at a price
of C$0.02 (equivalent to approximately 1.28 pence) (the "Placing Price") per
Placing Share and, separate to the Placing, certain directors have subscribed
(the "Directors' Subscription") for an aggregate of 33,100,000 common shares
(the "Director Shares") at a price of C$0.02 (equivalent to approximately 1.28
pence) per Director Share (the Placing and the Directors' Subscription together
being the "Fundraising"). The aggregate gross proceeds of the Fundraising are
C$7.7 million (equivalent to approximately GBP 4.93 million). 


In connection with the Fundraising, an application was made for the admission of
the Placing Shares and the Director Shares to trading on AIM (the "Admission")
and dealings commenced on AIM this morning in the United Kingdom.


The Placing Shares and the Director Shares, to be issued in connection with the
Fundraising, will be subject to the resale restrictions contained in the
Corporate Finance Manual of the TSX Venture Exchange (the "TSX-V"), which will
expire on October 8, 2013. Certain of the Director Shares will also be subject
to the resale restrictions set out in Canadian securities laws, which will also
expire on October 8, 2013. 


Use of Proceeds

The board of directors of the Company (the "Board") intends that the net
proceeds of the Fundraising will be used by the Company to consolidate the
Group's working capital position, fund capital expenditures and repay certain
outstanding indebtedness.


Specifically, the Board intends to use the net proceeds of the Fundraising of
approximately C$6.35 million, as follows:




--  approximately C$1.76 million on capital expenditure and development
    costs at Verticalnaya in preparation for the ramp-up to 11,000 tonnes,
    including the face kit; and a further C$3.1 million to fund operating
    losses until this operation is cash flow positive; and 

--  approximately C$1.49 million in general working capital (including
    approximately C$360k repayment of corporate creditors and C$350k
    repayment of a previously announced short term loan with a related party
    Salida Capital International Corp.). 



General

As compensation for the services they rendered in connection with the
Fundraising (excluding with respect to the purchase of Director Shares by John
Byrne and John Conlon, directors of the Company and related parties, as
previously announced), the broker, Cenkos Securities Plc, received a cash
commission of GBP 640,491.90 and a fee of GBP 50,000.


Cenkos Securities Plc subscribed for 50,000,000 Placing Shares in the Placing at
the Placing. The Placing Shares and the Director Shares have not been qualified
for sale in the province of British Columbia, Canada and may not be offered or
sold in the province of British Columbia, Canada, directly or indirectly, on
behalf of the Company.


The Placing Shares and the Director Shares have not been and will not be
registered under the U.S. Securities Act of 1933, as amended, or any state
securities laws, and may not be offered or sold in the United States absent
registration or an applicable exemption from such registration requirements. 


This press release shall not constitute an offer to sell or the solicitation of
an offer to buy the Placing Shares and the Director Shares in the province of
British Columbia, Canada, the United States or in any jurisdiction in which such
offer, sale or solicitation would be unlawful.


For the purposes of establishing the pound sterling exchange rate, the Company
has used the Bank of Canada exchange rate for Canadian dollars and pounds
sterling published on www.bankofcanada.ca at 12 noon on May 24, 2013 which was
C$1.5613 : GBP 1.00.


This press release contains projections and forward-looking information that
involve various risks and uncertainties regarding future events. Such
forward-looking information can include without limitation statements based on
current expectations involving a number of risks and uncertainties and are not
guarantees of future performance. There are numerous risks and uncertainties
that could cause actual results to differ materially from those expressed in the
forward looking information. These and all subsequent written and oral
forward-looking information are based on estimates and opinions on the dates
they are made and are expressly qualified in their entirety by this notice.
Except as required by law, EastCoal assumes no obligation to update
forward-looking information should circumstances or management's estimates or
opinions change.


FOR FURTHER INFORMATION PLEASE CONTACT: 
EastCoal Inc.
Abraham Jonker
President and Acting CFO
+1 (604) 681 8069 / +1 (604) 992 5600 (Cell)
www.eastcoal.ca


Cenkos Securities plc
Ken Fleming
+44 (0) 207 397 8900


Cenkos Securities plc
Derrick Lee
+44 (0) 131 220 6939


Cenkos Securities plc
Alan Stewart
+44 (0) 131 220 6939


Tavistock Communications
Jos Simson
+44 (0) 207 920 3150


Tavistock Communications
Emily Fenton
+44 (0) 207 920 3150

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