The Property consists of 12,943 hectares located just east of Sparwood, British Columbia. It is bounded by the Elk River to the west and Highway 3 to the south.

On the Property, the Mist Mountain Formation averages over 600 m in thickness and contains over 20 mineable coal seams, see Figure 4, Generalized Stratigraphic Column. Cumulative coal thickness is over 60 m. Seams range in rank from high- to low-volatile bituminous coal.

The Mist Mountain Formation consists of hard, competent, interbedded sandstones, siltstones, mudstones and coal seams. Strata consists of light to dark grey to grayish brown weathering siltstone, silty shale, mudstone, sandstone and thin to thick coal seams. Chert and quartzite pebble conglomerate and conglomeratic sandstone focally form conspicuous thin to thick interbeds in exposures near Sparwood. The sedimentary rocks contain well defined discontinuities in the form of bedding planes, faults, shears and joints. The bedding planes are the most continuous of the geological structures in the strata and typically exhibit persistence on the order of hundreds of meters. In general the bedding at the mine dips to the west and southwest at inclinations of 10º to 30º.

The aggregate thickness of the coal seams in the active mining area is about 60 m. The most important seam groups are 10, 8 and 7 that occur in the lower part of the sequence. Coal measures within the Property are contained within four areas that are either actively being mined or which are immediate targets for development of surface mining pits: South Pit, Baldy Ridge, Baldy-Cedar and Natal Ridge.

The major structure of the Property is a southwest plunging syncline, known as the Sparwood (Michel) Syncline which contains numerous thrust faults that repeat the mineable coal sequences. The numerous thrust faults resulted in thickened coal strata by overlapping and drag folding. The tectonic thickening of the basal 10 Seam is an important factor in the mine planning and is discussed further below. Most of the coal measures in the mine plan dip to the southwest at less than 20º. The thrust faults generally dip west to southwest at inclinations of 20º to 50º. The faults generally consist of broad disturbed zones of broken rock with limited fault gouge.

Approximately 30 coal seams have been identified and named. Seams and partings may be discontinuous over the Property, and as a result, individual seams (i.e., coals in the 7 Seam package) have been further subdivided (i.e., 7S, 7L 7R1 and 7RX seams). Seams can vary in thickness from less than 1 m to over 15 m. The 10 Seam is nominally 15m thick and contributes about 60% of the in situ tonnage and 71% of the clean coal on the Property.

Elkview Operations (EVO) operates a metallurgical coal mine located in the Elk Valley approximately 3 km east of Sparwood, British Columbia.

The coal produced is a high-quality mid-volatile hard coking coal. Lesser quantities of lower-grade hard coking coal are also produced.

The mining process occurs in a conventional open pit, with preliminary drilling and blasting operations. Electric shovels are utilizing for loading mined material into haulage trucks.

The mining process occurs in a conventional open pit, with blasting occuring every two to three days. The mined material is lifted by electric shovels into the backs of haul trucks. The coal is then taken to a hopper facility, where a conveyor moves it 3.5 kilometres overland to a crusher.

Following mining, the coal is washed in coal preparation plants using a variety of conventional techniques and conveyed to coal or gas fired dryers for drying. Processed coal is conveyed to clean coal silos or other storage facilities for storage and load-out to railcars.

The Elkview wash plant employs standard coal washing techniques and equipment which include heavy media cyclones, water only cyclones, froth flotation and a thermal dryer.

A major expansion of our Elkview Operations processing facility, completed in the second quarter, increased Elkview’s capacity to allow it to produce 9 million tonnes annually.