Migao Corporation

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Migao Corporation A Leading Specialty Potash
Fertilizer Enterprise
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Disclaimer

• Forward Looking Information Statement
• The contents of this presentation contain
  statements that may constitute forward-looking
  statements within the meaning of applicable
  securities legislation. Forward-looking
  statements may include financial and other
  projections, as well as statements regarding
  future plans, objectives or economic performance,
  or the assumptions underlying any of the
  foregoing. Forward-looking information involves
  significant risks, assumptions, uncertainties and
  other factors that may cause actual future
  results or anticipated events to differ
  materially from those expressed or implied in any
  forward-looking statements and accordingly,
  should not be read as guarantees of future
  performance or results.
• Actual results, performance or achievement could
  differ materially from those expressed in, or
  implied by, any forward-looking statements made
  and, accordingly, investors should not place
  undue reliance on any such forward-looking
  statements. New factors emerge from time to
  time, and it is not possible for management to
  predict all of such factors and to assess in
  advance the impact of each such factor on Migaos
  business.

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Corporate Overview

• Developer, producer, marketer of specialty
  potash fertilizers
• Established - June 2003
• 7 locations across China
• 2006 revenue - 58 million
• 2006 earnings - 8.6 million
• May 2006 18 million financing
• Feb 2007 25 million financing

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Migao Corporation

• Migao is positioned to become the leading
  supplier of specialty potash fertilizers to the
  Chinese market.

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Locations
Changchun Migao
Liaoning Migao
Beijing
Tianjin Migao
Shanghai Migao
Sichuan Migao
Zunyi Migao
Guangdong Migao
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Fertilizer in China

• China has 10 of worlds arable land and 20 of
  the population
• Central Governments emphasis on agriculture
• Growing demand for high quality food by Chinese
  consumers
• Largest consumer of fertilizer in the world 25
  of worlds consumption

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Potash in China

• Potash (K)
• 2/3 of global potash supply in Canada and Russia
• Few potash reserves in China
• Soil is generally potassium deficient throughout
  China
• Annual demand for potash-based fertilizer more
  than 10 million tonnes (majority imported)
• Potash demand increased more than 100 since 1999

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Migao Products

• Potash-based specialty fertilizers
• Potassium Nitrate
• Potassium Sulphate
• By-products
• Ammonium Chloride
• Hydrochloric Acid

KNO3
K2SO4
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Production Process
Potassium Chloride
Sulphuric Acid
Ammonium Nitrate
Double Decomposition Process
Mannheim Chemical Process
Potassium Sulphate
Potassium Nitrate
Hydrochloric Acid
Ammonium Chloride
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Strategic Locations

• Proximity to
• Customers
• Raw Supply
• Infrastructure

Changchun Migao
Liaoning Migao
Beijing
Tianjin Migao
Shanghai Migao
Sichuan Migao
Zunyi Migao
Guangdong Migao
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Sichuan Migao
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Sichuan Migao

• 60,000 tonne potassium nitrate capacity
• By-product 33,000 tonnes ammonium chloride
• Patent application (Double Decomposition Process)
• 5 year sales agreement
• Yunnan Tobacco consortium (40,000 tonnes per
  year)
• Expansion schedule
• 20,000 tonnes potassium nitrate

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Guangdong Migao
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Guangdong Migao

• Production began December 2004
• 100,000 tonne potassium sulphate capacity
• By-product 120,000 tonnes hydrochloric acid
• 60,000 tonne sales contracts
• Property can accommodate additional 100,000
  tonnes

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Liaoning Migao
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Liaoning Migao

• Production began December 2005
• 40,000 tonne potassium sulphate capacity
• By-product 50,000 tonnes hydrochloric acid
• 45,000 tonne sales contract
• Local tobacco, fruit and vegetable customers
• Test program with Japanese customer
• Facility enhancements
• Granulation of potassium sulphate
• Purification of hydrochloric acid

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Research and Development

• Production efficiency oriented
• Double Decomposition Process
• Environmentally responsible, clean production
• High efficiency, energy saving
• Innovative and reliable
• Patent application
• Mannheim Process
• Export quality product development
• Commitment to quality

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Financial Highlights

• Fiscal 2006
• Cash - 16 million
• Working capital - 23 million
• Revenue - 58.4 million
• Earnings - 8.6 million
• Gross margin 24

• 3/4 2007
• Cash - 15 million
• Working capital - 42 million
• Revenue - 76 million
• Earnings - 8.9 million
• Gross margin 23

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Revenue and Earnings
CDN millions
50
Liaoning
40
30
Guangdong
20
Sichuan
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Earnings
0
3/4 2007
2004
2005
2006
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Growth Profile (run rate at calendar year end)
2005 80,000 tonnes
2007 260,000 tonnes
2006 200,000 tonnes
2008 380,000 tonnes
KNO3
K2SO4
? Potassium Sulphate ? Potassium Nitrate
KNO3
K2SO4
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Investing in Growth

• Established products and customers
• All production sold until April 2008
• Uniquely positioned
• Proprietary production process
• Strong fundamentals
• 4-year revenue and earnings growth
• Compelling growth profile
• Advanced expansion timelines
• Experienced management team

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