The geology of the properties is consistent with regional trends. Coal seams of economic importance on the properties typically range from 1 foot to 6 feet in thickness and are primarily low-volatile in rank. There are 11 coal seams on the properties that demonstrate reserve or resource potential including (not all of which are included within this report), in descending stratigraphic order: Sewickley, Redstone, Pittsburgh, Bakerstown, Upper Freeport, Lower Freeport, Upper Kittanning, Middle Kittanning, Lower Kittanning, Brookville, and Mercer.

Mineable coal seams within the properties are typically low-ash, low to high-sulfur, and high-thermal content bituminous coals. Regionally, the coals are typically low volatile in rank, with rank increasing from west to east. The maximum seam thickness may reach over 6.0 feet where multiple coal benches occur in proximity to one another; however, the average mineable thickness of the seams in this evaluation generally ranges from 1 foot to 4 feet. Seams are generally continuous, but may be locally absent. Secondary discontinuity due to erosional features is present in most areas, resulting in seam outcropping, or visible exposure of the seam at the surface. Other than oxidation of the coal exposed at the surface, erosion of the seams has no significant impact on the mineralized deposits. Mineable seams associated with the properties are generally outcrop-accessible. Coal seams are characterized by both single-bench and multiple-bench coal horizons with parting (non coal) material varying by seam and area. Seam parting is common within the coal seams on the properties with intra-seam parting material increasing drastically in some areas. Roof strata are typically shale or sandy shale with zones of sandstone roof being common. Floor strata are typically sandstone, shale, sandy shale, fireclay, or in the case of the Upper Kittanning, limestone.

Limestone beds occur within the various stratigraphic groups of the region. Some of these limestone beds are extracted in conjunction with surface mining of the Sewickley coal in particular.

NAPP currently operates the the Quecreek Mine, an underground mine utilizing the room and pillar mining method.

The Quecreek C’ mine is active with a single production section. The Upper Kittanning C' seam is accessed via an existing boxcut along the outcrop. This mine is a metallurgical coal operation with all of its remaining production on leased mineral property.

Production is scheduled for 255 days each year, which represents production on Monday through Friday. On each day, one production section is scheduled to produce coal on two shifts; the third shift is reserved for maintenance and mine conveyor belt and power moves. The section is configured as a regular section with one continuous miner available for production. Productivity is planned at the rate of 117 feet of advance per shift of operation. A total of 57 employees are assigned to the mine.

Principal production equipment includes a continuous miner, two roof bolters, three shuttle cars, and two scoops. Coal is extracted from the production face with the continuous miner and hauled to the mine conveyor in shuttle cars. At the conveyor belt, the coal is discharged from the shuttle cars onto a feeder breaker for transfer onto the conveyor. The conveyors carry the coal to the outside, where it is stacked on the ground to await truck transport to the preparation plant and load out. The truck haul distance is approximately 15 miles.

Expected annual production averages approximately 163,000 marketable tons.

NAPP currently operates two preparation plants, the Cambria Plant and the Shade Creek Plant, and has one preparation plant temporarily idled, the Rockwood Plant.

Raw coal produced from the mine is currently delivered by truck to the Cambria and Shade coal preparation facilities.

Some raw coal produced from the mine is shipped directly to the customer on a raw basis or blended with processed or purchased coal, depending on coal quality and specific customer requirements. Corsa preparation facilities have raw coal handling systems consisting of a rotary breaker and screen used to remove large rock and size raw coal. Raw coal is then shipping on a raw basis or blended with washed coals from the preparation plant.

Raw coal to be processed is stockpiled, then loaded by a wheel-loader into a hopper for conveyor transport into the coal preparation plant.

Raw stockpile capacity includes approximately 70,000 tons of raw coal ground storage at the Shade Creek plant and 60,000 tons of raw coal ground storage at the Cambria plant.

The Cambria Preparation Plant is designed for 400-tons per hour (tph) raw coal feed. It was relocated from its original site in 2009 incorporating design upgrades at that time. Raw coal at the Cambria plant is crushed screened to provide sized material to each of the following process circuits.

The Cambria complex has the capacity to store 120,000 tons of clean coal. The plant is serviced by CSX and has a unit-train loading capacity of 2,000 tph and can load a 130-car unit train. The power requirement for the Cambria plant as currently configured averages approximately 5,500 kilovoltampere (kVA). Water consumption at the plant averages approximately 100 gallons per minute (gpm).

The Shade Creek Preparation Plant is designed for 500 tph raw coal feed. Currently the plant is used primarily for toll washing of 3rd party coal, in addition to processing Corsa production which is shipped on NS.

The Shade plant was updated in 2008 with improvements including: increase in heavy media cyclone clean coal and reject drain and rinse screen capacity, addition of the Teeter Bed Separator circuit, the addition of the column flotation circuit, increase in fine clean coal centrifuge capacity, and addition of a high capacity thickener. Raw coal is crushed and screened to provide sized material to each of the following process circuits.

The Shade Creek complex has the capacity to store 120,000 tons of clean coal, including 10,000-ton storage building and a 5,000-ton capacity silo. The plant is serviced by the NS, with a unit-train loading capacity of 2,000 tph and can load a 100-car unit train. The power requirement for the Shade plant, as currently configured, averages approximately 6,500 kVA. Water consumption at the plant averages approximately 160 gpm.

Clean coal and refuse products are dewatered with vibratory screens, sieve screens, and centrifugal dryers. The thickener underflow is concentrated by belt presses and is transported to the combined refuse disposal facility by off-road trucks. Coarse coal refuse is trucked from the plant to the combined refuse disposal facility.

The Rockwood plant was acquired from Wilson Creek Energy. This plant is a heavy-media type plant with a rated capacity of 400 tph, with three primary circuits.

The Rockwood plant currently has the capacity to store 24,000 tons of clean coal, with a permitted area for expansion. The plant is connected to high voltage power through four transformers that total 5,000 kVA. Make-up water consumption is estimated at 85 to 90 gpm.