Mr. George Dethlefsen reports

CORSA ANNOUNCES COMPLETION OF ACQUISITION OF PBS COALS

Corsa Coal Corp. has completed the previously announced acquisition of PBS Coals Ltd., a wholly owned subsidiary of OAO Severstal, in an all-cash transaction for consideration of $60-million (U.S.), subject to customary adjustments for working capital and debt. As part of the transaction, Corsa has assumed certain reclamation and water treatment liabilities totalling approximately $60-million (U.S.) and will finance $20-million (U.S.) of cash currently used as bonding collateral by PBS Coals into escrow accounts for water treatment and certain other liabilities, to be released to a subsidiary of OAO Severstal following a customary time period and subject to adjustments.

As part of its acquisition financing, Corsa completed its previously announced non-brokered private placement of 463,821,966 common shares for gross proceeds of approximately $65-million (U.S.) at 15 cents per common share and entered into a $25-million (U.S.) non-revolving term credit facility with a syndicate of lenders that includes Sprott Resource Lending Partnership (SRL). The proceeds of the private placement and from the credit facility were used to satisfy the consideration payable in connection with the transaction, with additional proceeds being used for purposes related to the transaction and growth capital.

Changes to management and the board of directors

The company is pleased to announce the appointment of George Dethlefsen as its chief executive officer. Mr. Dethlefsen is currently also a director of Corsa. As part of the transition, Mr. Dethlefsen has stepped down as managing director of Quintana Capital Group. In connection with his appointment, the board of directors of the company granted Mr. Dethlefsen stock options to purchase a total of six million common shares.

The options were granted on Aug. 19, 2014, in accordance with Corsa's amended and restated stock option plan, are exercisable for five years at a price of 29 cents per common share, and are subject to the terms and conditions of the option plan, Mr. Dethlefsen's employment agreement, and the approval of the TSX Venture Exchange. Such options will vest one-third on the first anniversary of the date of grant, one-third on the second anniversary of the date of grant and one-third on the third anniversary of the date of grant. The 29-cent exercise price represents the closing market price on Aug. 18, 2014, the day immediately preceding the date of grant.

Pursuant to the terms of Sprott Resource Partnership's (SRP), a wholly owned affiliate of Sprott Resource Corp., acquisition of common shares under the private placement, Arthur Einav, a nominee of SRP, was appointed to the board. Keith Dyke, chief operating officer and president of Corsa, stepped down as a member of the board.

Arthur Einav is managing director, general counsel and corporate secretary of Sprott Resource Corp. Mr. Einav is also general counsel of Sprott Inc. and is a director of Independence Contract Drilling Inc., a New York Stock Exchange-listed portfolio company of Sprott Resource. He holds a bachelor of laws degree and a master in business administration from Osgoode Hall Law School and the Schulich School of Business. He also holds a bachelor of science degree from the University of Toronto, and is a member of the Law Society of Upper Canada and the New York State Bar.

Stock option grants

In connection with the acquisition, the board granted stock options to purchase a total 12.2 million common shares to certain employees of PBS and the company. The grant, together with the options granted to Mr. Dethlefsen, represents approximately 1.5 per cent of the total common shares outstanding. The options granted to such employees were granted in accordance with the option plan, are exercisable for five years at a price of 29 cents per common share, and are subject to the terms and conditions of the option plan, and TSX-V approval. Such options will vest one-third on the first anniversary of the date of grant, one-third on the second anniversary of the date of grant and one-third on the third anniversary of the date of grant.

Financing of the transaction

Private placement

The TSX-V has conditionally approved the listing of the common shares issued under the private placement and the common shares issued as part of the private placement are subject to resale restrictions pursuant to applicable securities laws requirements and will not be freely tradeable until Dec. 20, 2014. The private placement was originally announced on July 15, 2014.

As part of the private placement, Corsa and QKGI New Holdings LP (New QKGI) allocated New QKGI's entire subscription of 141,786,666 common shares to two affiliated funds of Quintana Capital Group LP, Quintana Energy Partners II LP (QEP II) and Quintana Energy Partners II -- TE, LP (QEP II -- TE). QEP II acquired 128,824,387 common shares for approximately $18.2-million (U.S.) and QEP II -- TE acquired 12,962,279 common shares for approximately $1.8-million (U.S.).

Accordingly, New QKGI, QKGI Legacy Holdings LP, QEP II and QEP II -- TE, all affiliates of Quintana Capital Group, hold an aggregate of 578,819,438 common shares, representing 48.6 per cent of the issued and outstanding common shares and 170,316,639 redeemable membership units of Wilson Creek Energy LLC, Corsa's U.S. operating subsidiary, which, for as long as amounts are outstanding under the credit facility, are redeemable for common shares on a one-for-one basis. Assuming the tender for redemption of all redeemable units and exchange for common shares, QEP would exercise control or direction over an aggregate of 749,136,077 common shares, representing approximately 55.0 per cent of the outstanding common shares.

In addition, SRP, which acquired 236,963,302 common shares as part of the private placement, representing approximately 19.9 per cent of the outstanding common shares, entered into a registration rights agreements with Corsa on Aug. 19, 2014, which provide SRP with rights to twice demand registration in Canada for as long as it holds at least 10 per cent of the outstanding common shares. A copy of the registration rights agreement will be filed on SEDAR under Corsa's profile. The summary herein is qualified in its entirety by the detailed terms and conditions of the registration rights agreement.

SPR will also have certain continuing rights, including the right to nominate one member of the Corsa board of directors, subject to certain conditions. The right to nominate one member of the Corsa board of directors will terminate if SRP, together with its affiliates, ceases to hold at least 10 per cent or more of the outstanding common shares for a continuous period of at least 30 days, and QEP has undertaken to vote in favour of the election of the SRP board nominee at any shareholder meeting, for so long as QEP owns at least 20 per cent of the outstanding common shares.

Credit facility

In connection with the credit facility, SRL was issued 36.1 million common share purchase warrants of Corsa. Each bonus warrant has a term of five years and is exercisable for one common share at an exercise price of 19.5 cents. The common share purchase warrants issued to SRL and the common shares issuable thereunder are subject to resale restrictions pursuant to applicable securities laws requirements and the policies of the TSX-V, and will not be freely tradeable until Dec. 20, 2014.

A copy of the credit agreement with respect to the credit facility will be filed on SEDAR under Corsa's profile. The summary herein is qualified in its entirety by the detailed terms and conditions of the credit agreement.

Advisers

Corsa obtained legal and tax advice from Stikeman Elliott LLP, Vinson & Elkins LLP, PennStuart, Fike, Cascio & Boose LLP, Jackson Kelly PLLC and PricewaterhouseCoopers LLP.

Additional disclosure regarding QEP's investment in Corsa

QEP currently owns an aggregate of 578,819,438 common shares, or approximately 48.6 per cent of the common shares outstanding, and, accordingly, QEP is a control person as defined in the TSX-V corporate finance manual, and the subscription by QEP II and QEP II -- TE under the private placement was a related-party transaction as defined under Multilateral Instrument 61-101. The private placement was exempt from the minority shareholder approval requirements of MI 61-101, as neither the fair market value of any securities issued to nor the consideration paid by QEP II and QEP -- TE, together, exceeded 25 per cent of Corsa's market capitalization calculated in accordance with MI 61-101.

In connection with the private placement, QEP waived its anti-dilution rights under its investor rights agreement with the company dated July 31, 2013.

The address of QEP is 601 Jefferson St., Suite 3600, Houston, Tex. QEP's acquisition of common shares is made as a strategic investment, and QEP may increase or decrease its investment, directly or indirectly, in Corsa from time to time, depending on market conditions or any other relevant factors.

A copy of the early warning report to be filed by QEP will be available shortly under Corsa's profile at SEDAR and further information can be obtained by contacting Jimmy McDonald, chief financial officer, at 713-751-7500.

We seek Safe Harbor.