Ceylon Graphite Corporation Completes Reverse Takeover

December 30, 2016 - Ceylon Graphite Corp. (the "Company") (formerly, NWest Energy Corp.) is pleased to announce the completion of its previously announced reverse takeover transaction (the "RTO") pursuant to which it acquired Plumbago Refining Corp. B.V. ("Plumbago"). The Company's common shares will commence trading on the TSX Venture Exchange (the "TSXV") as a Tier 2 mining issuer under the symbol "CYL" once the TSXV's conditions for listing are satisfied and the TSXV issues its final exchange bulletin confirming the completion of the RTO. Trading is anticipated to commence on or about January 3, 2017. As a part of the RTO, the Company changed its name from "NWest Energy Corp." to "Ceylon Graphite Corp.". Following the completion of the RTO, Plumbago is now a wholly-owned subsidiary of the Company. The Company will continue the business of Plumbago (described in further detail below).


Reverse Takeover

Effective on September 30, 2016, the Company completed a consolidation on the basis of one (1) new common share for every seven (7) old common shares.

Pursuant to the RTO, the Company issued 34,673,977 post-consolidated common shares of the Company to the shareholders of Plumbago in exchange for the delivery to the Company of 10,241 of the 17,741 then issued and outstanding common shares of Plumbago held by the shareholders of Plumbago at an exchange ratio of 3,385.8 (the "Exchange Ratio") common shares of the Company for each such common share of Plumbago (34,673,977 common shares of the Company issued at a deemed issue price of $0.20 per common share in exchange for 10,241 common shares of Plumbago).

Additionally, the Company issued 25,393,500 special warrants (the "Special Warrants") to certain of the shareholders of Plumbago in exchange for the delivery to the Company of the remaining 7,500 issued and outstanding common shares of Plumbago held by such shareholders of Plumbago at the Exchange Ratio, pursuant to a special warrant agreement among the Company and such shareholders.

In connection with the closing of the RTO, the Company completed a non-brokered private placement (the "Private Placement") of 14,845,000 units (each a "Unit"), at a price of $0.20 per Unit for gross proceeds of $2,969,000. Proceeds from the Private Placement will be used as set out in the Filing Statement (as defined below). Each Unit consists of one (1) common share and one (1) common share purchase warrant at a price of $0.30 for two (2) years. The warrants are subject to an acceleration clause whereby if the common shares trade equal to or greater than $0.50 for a period of twenty (20) consecutive trading days, the warrant expiry date shall accelerate to a date that is not less than twenty (20) days after notice is given. All securities issued pursuant to the Private Placement are subject to a four-month hold period expiring on April 27, 2017.

In connection with the Private Placement, the Company paid certain eligible finders and registered brokers aggregate cash commissions of $156,800 and issued an aggregate of 788,000 broker warrants (the "Broker Warrants") having the same terms as the warrants issued in the Private Placement.

Effective upon the closing of the RTO, as a result of the reverse takeover of the Company by the shareholders of Plumbago and to align the financial years of the Company to that of Plumbago, the financial year of the Company has been changed from September 30 to March 31.

The Company currently has a total of 51,544,447 common shares, 25,393,500 Special Warrants, 788,000 Broker Warrants, 15,549,246 share purchase warrants and 636,441 incentive stock options of the Company outstanding. An aggregate of 25,405,404 common shares, 25,393,500 Special Warrants, 704,246 share purchase warrants and 507,870 incentive stock options are subject to escrow pursuant to TSXV escrow requirements.

As a result of the closing of the RTO, the directors and officers of the Company are now:
- Bharat Parashar Chief Executive Officer & Director
- Bill Fleming Chief Financial Officer & Director
- Kevin Aylward Director
- Brett James Director
- George Smitherman Director
- Robert Marvin Director

A filing statement describing the Company and Plumbago, as well as the terms of the RTO, prepared in accordance with the policies of the TSXV, is available on SEDAR at www.sedar.com (the "Filing Statement"). The summary of the RTO set out herein is qualified in its entirety by reference to the description of the RTO in the Filing Statement.

This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities described herein in the United States. The securities described herein have not been registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act"), or any state securities law and may not be offered or sold in the "United States", as such term is defined in Regulation S promulgated under the U.S. Securities Act, unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration requirements is available.


From the CEO

"This is an important day in the Company's evolution to becoming a force in global graphite" said Bharat Parashar, Chief Executive Officer.


About the Company

The Company is a mineral exploration and development company that is focused on its graphite projects located in Sri Lanka.



For further information:

Bharat Parashar, Director & CEO
(202) 352-6022
bharat.parashar@clovecapital.com



This news release contains forward-looking information based on current expectations. Statements about the date of trading of the Company's common shares on the TSXV, final regulatory approvals, the proposed use of proceeds from the Private Placement, among others, are all forward-looking information. Forward-looking statements consist of statements that are not purely historical, including any statements regarding beliefs, plans, expectations or intentions regarding the future. Such information can generally be identified by the use of forwarding looking wording such as "may", "expect", "estimate", "anticipate", "intend", "believe" and "continue" or the negative thereof or similar variations. Readers are cautioned not to place undue reliance on forward-looking statements, as there can be no assurance that the plans, intentions or expectations upon which they are based will occur. By their nature, forward-looking statements involve numerous assumptions, known and unknown risks and uncertainties, both general and specific, that contribute to the possibility that the predictions, estimates, forecasts, projections and other forward looking statements will not occur. These assumptions, risks and uncertainties include, among other things, the state of the economy in general and capital markets in particular, and other factors, many of which are beyond the control of the Company. Risk factors that could cause actual results or outcomes to differ materially from the results expressed or implied by forward-looking information include, among other things: the failure to obtain the required approval for the RTO; changes in laws; competition; changes in legislation, including environmental legislation, affecting the Company; and lack of qualified, skilled labour or loss of key individuals; political and social uncertainties; general economic and business conditions; and changes in the regulatory regime. The Company cautions the reader that the above list of risk factors is not exhaustive. The final exchange bulletin will not be issued if the TSXV determines that the Company has not met the conditions set out in the TSXV's conditional approval letter. There can be no assurance that planned exploration will be completed as proposed or at all, or that economic resources will be discovered or developed on the graphite properties. Forward-looking statements contained in this news release are expressly qualified by this cautionary statement. These statements should not be read as guarantees of future performance or results. Such statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements to be materially different from those implied by such statements. The Company assumes no responsibility to update or revise forward-looking information to reflect new events or circumstances unless required by law.

The forward-looking statements contained in this news release are made as of the date of this news release. Except as required by law, the Company disclaims any intention and assumes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Additionally, the Company undertakes no obligation to comment on the expectations of, or statements made by, third parties in respect of the matters discussed above.

Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.