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.

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 Sh ........