The Ram River property is divided into two areas containing coal resources (designated as North Block and South Block) with a similar level of structural complexity. Both blocks have a gentle syncline structure. In both blocks, a thrust fault has been identified. The structure of this area exhibits the features that cause it to be categorized as a Moderate Geology Type in both blocks.

The North Block bifurcates from the South Block, with the North Block, measuring approximately 15 km in length and 3.5 km in width and with the South Block measuring, approximately 14 km at its longest point and 2.7 km at its widest point.

The Luscar Group is the dominant host rock in the vicinity of the Ram River Property. The orientation of the Luscar Group in the property is aligned with the regional Northwest -Southeast orientation of the Rocky Mountains. The Alberta Group flanks the western side of the property. Northwest-southeast thrust faults occur to the west and east of the property area. The major regional Burnt Timber thrust fault is located 1 km to 2.5 km northwest of the property lease boundary. The thrust has a northwest-trending strike and a southwest dipping angle of 35° to 40° with vertical displacement of approximately 90 m.

The general structure of the Ram River property
consists of northwest-trending anticlines and synclines. The major folding structure is the Ram River anticline. Most of the coal, in close proximity of the anticline axes, was eroded and the area of interest was divided into two blocks (northeast and southwest blocks) with gentle syncline structure.

The dipping angle of Seams 2 and 3 is less than 15° in large portions of the blocks (Drawing 11). Higher dipping angles (up to 35°) are observed in the northern part of the South block and the southern part of the North block along Ram River anticline axes.

The Ram River Property is intersected by northwest-southeast trending anticlines and synclines. The distance between the troughs of the folds is approximately 700 m in the central part of the North Block. Commonly, the dips of the stratigraphy vary from 10° and 36° (Erdman, 1945). The Ram River Anticline has had the largest impact on the property, as most of the coal that was near the axes of the Ram River Anticline was removed by erosion. The location of this anticline structure generally aligns with the break between the North and South blocks.

Drilling has penetrated total of four seams on the property. The seams are named, from base to top, Seam 1, Seam 2, Seam 3 and Seam 4. Seam 1, Seam 3 and Seam 4 occur as single ply seams.

Seam 2 has splits or a “Rider Seam” associated with it (Seam 2R). This rider is typically thinner and usually not as laterally continuous as Seam 2. Occasionally the rider seams achieve thickness more than 1 m.

Seam 3 is the primary seam in the area. No major partings were observed within the seam intervals. The seam thickness varies, and has an average thickness of 3.5 m. The sediment above Seam 3 varies from 0 m near outcrops to 150-200 m in the northwest block, to more than 500 m in the southeast block. The covering materials are mainly shale, sandstone and silty sandstone.

Seam 2 is thinner than Seam 3, with an average thickness of 2.3 m, as illustrated on Drawing 13. Shale to silty shale occur above Seam 2 between Seam 2 and Seam 2R.

Surface mining operation utilizing conventional truck and electric shovel mining methods with capacity for production of 6 Mtpa run of mine (ROM) coal at an average strip ratio of 13.2:1 (bank cubic meters mine rock to 1 tonne ROM coal). The surface mine has been sequenced to limit the creation of external mine rock storage facilities and allow for ongoing progressive reclamation.

The mine plan for the PFS level evaluation exploits only the surface mineable portion of the North Block area of the property. As discussed in the geology section, additional geology and geotechnical field programs will increase the confidence in the South Block resources which will potentially result in additional reserves being defined and an extended mine life or increased production rate.

The mining equipment proposed to support the mine plan is conventional truck and shovel/hydraulic excavator equipment of a capacity similar to that currently used in western Canadian coal operations and in the Alberta oil sands operations around Fort McMurray.

This equipment configuration provides the capacity and mobility required for coal mining on the Aries property. Efficient excavation of the coal seams without delaying mining of rock is a key component of meeting the production sequence for the project. Primary coal loading with front end loader units and smaller excavators for coal cleaning have been used. These coal loading units would be best matched with Komatsu HD-1500 (144 tonne) rear dump haul trucks. The coal haul trucks will be fitted with expanded coal boxes to increase their volumetric capacity.

Norwest developed a PFS level design of an industry standard coal preparation process with a feed capacity sized to produce approximately 4 Mt/y coking product coal from a 6 Mt/y ROM feed. The target product ash ranges between 9.0% and 9.5%, on an air-dried basis (“adb”). A key objective has been assigned to achieve product total moisture of 8.5% or less with an emphasis on mechanical dewatering methods to minimize thermal drying requirements.

With annual throughput of the Aries coal handling and processing plant (CHPP) targeted to be 6.0Mt/y ROM, a 7,000 hr/y operating schedule followed with a mechanical availability of 92.5% (6,500 coal-on hours) or better, is required to limit the coal preparation plant module (CPP) from exceeding 950 t/h (as-received basis).

The process operation generally follows the order in which the coal flows through the plant, from raw coal entering the plant through to dewatering.

The product coal is conveyed away from the th ........