Royal Coal Announces $9 Million Final Advance Under Sandstorm Energy Coal Purchase Agreement

Royal Coal Corp. is pleased to announce that, in accordance with the coal purchase agreement with Sandstorm Metals & Energy Ltd. previously announced November 26, 2010, Sandstorm Energy has advanced the balance of the agreed upon upfront payments to the Company, being US$9 million. Sandstorm Energy has now advanced a total of US$11 million to the Company under the Coal Purchase Agreement and US$3 million to the Company under the previously announced royalty arrangement with Sandstorm Energy, for a total of $14 million advanced since December 17, 2010.

Closing of this coal purchase agreement allows the Company to start work on its wholly-owned Sid Mining Project in Eastern Kentucky, the same location as Royal Coal’s currently operating Big Branch Mining Project, so that coal production can commence at the Sid Mining Project in the first half of 2011.

The Company has repaid US$4 million of the principal amount outstanding under the note purchase agreement dated September 30, 2009 (as subsequently amended from time to time, the “Purchase Agreement”) among the Company and Juno Special Situations Corporation (“Juno”). As previously reported, Juno received all amounts loaned to the Company pursuant to the Purchase Agreement from an unrelated lender for the sole purpose of re-lending the funds to the Company on the same terms provided by the third party lender. Juno has made a corresponding US$4 million principal repayment to the third party lender.