Prophecy Coal Obtains Credit Facilities Totaling $7 Million To Advance Chandgana Project

VANCOUVER, BRITISH COLUMBIA–(Marketwire – Dec. 30, 2011) – Prophecy Coal Corp. ("Prophecy" or the "Company") (TSX:PCY)(OTCQX:PRPCF)(FRANKFURT:1P2) is pleased to announce that it has executed a term sheet for a secured debt facility of up to $5 million (the "Debt Facility") with a leading resource lender and a $2 million inter-company loan facility agreement (the "Inter-Co Facility") with its controlled affiliate, Prophecy Platinum Corp. The Debt Facility is currently subject to completion of the lender's due diligence, TSX approval and completion of customary credit documentation.

The Debt Facility is due in fourteen months after its drawdown and bears interest at 10% per annum, compounded quarterly. A structuring fee of $50,000 is payable in cash as well as up to 1 million common shares of Prophecy Coal. The common shares issuable to the lender will be subject to a four month hold period. The Debt Facility is secured by a general security agreement and by a pledge of a number of Prophecy Platinum shares which must remain at 300% of the amount owed under the Debt Facility.

The Inter-Co Facility provides the Company and Prophecy Platinum with the ability to request a demand loan from the other company of up to $2 million at an interest rate of 14.4% per annum, compounded annually. Special committees of independent directors from both companies reviewed and approved the Inter-Co Facility. The size and nature of the Inter-Co Facility make it exempt from related party transaction rules including minority shareholder approvals.

John Lee, Chairman and CEO of Prophecy Coal states: "These facilities should carry Prophecy Coal towards completing Power Plant Project Financing in 2012. The company currently has no debt and over $120 million in assets."

About Prophecy Coal

Prophecy Coal Corp. is a Canadian listed company engaged in developing energy projects in Mongolia. The company has over 1.4 billion tonnes of surface minable thermal coal resources on two coal properties in Mongolia. Prophecy Coal's Ulaan Ovoo coal mine is in production and its Chandgana mine mouth power plant has been permitted. Prophecy Coal is the controlling shareholder of Prophecy Platinum Corp. (TSX VENTURE:NKL). Mineral resources that are not mineral reserves do not have demonstrated economic viability. Further information on Prophecy Coal can be found atwww.prophecycoal.com.

ON BEHALF OF THE BOARD OF DIRECTORS Prophecy Coal Corp.

John Lee, CEO/Chairman

This news release contains forward-looking statements, which are based on Prophecy Coal's current internal expectations, estimates, projections, assumptions and beliefs, which may prove to be incorrect. The forward-looking statements are not guarantees of future performance and undue reliance should not be placed on them. Actual results may differ materially as a result of any number of factors and uncertainties, many of which factors are beyond the Corporation's control. Many of these risks and uncertainties are described in Prophecy Coal's most recent annual information form, Prophecy Coal's management's discussion and analysis and other documents Prophecy Coal files with the Canadian securities authorities atwww.sedar.com. Prophecy Coal undertakes no obligation to update or revise any forward-looking statements except as required by applicable securities laws.