The Red Hills Mine is in the Wilcox Group of Mississippi which is the most prolific lignite-bearing stratum in the state of Mississippi. The Wilcox Group and underlying Midway Group were deposited during Paleogene time; 66 to 23 million years ago. The most prominent characteristics of the Wilcox Group formations are the cyclical deposition and lateral persistence of the lithologic units, especially the lignite seams. The section from the Gravel Creek Member through the Tuscahoma Formation represents a transition from a transgressive sequence of valley fill, marginal marine strata (lower Gravel Creek) to predominantly regressive, nonmarine, deltaic strata (upper Gravel Creek through the Tuscahoma).

During each depositional geologic sequence, organic material was repeatedly buried by sediment in an ideal, oxygen-free environment. This ideal environment was attributed to the humid, subtropical conditions and high water-table of wetlands present during Paleogene time which prevented plant matter from decaying prior to burial. The oxygen-free environment combined with heat and pressure from continual deposition of overlying sediments allowed for the formation of peat and further mineralization of lignite over time by undergoing a process known as humification and biochemical gelification.

The regional structural geology is fairly consistent. The regional strike is northwest-southeast. The strata are nearly flat lying, dipping to the southwest at only 25 to 35 ........

The lignite at Red Hills Mine surface mining operation is recovered using dragline and conventional truck and shovel mining methods due to the proximity of the lignite to the surface and the physical characteristics of the deposit. Mining operations progress in a five-step process, which includes clear and grub, overburden and interburden removal, lignite production, spoil backfill and grading, and reclamation. In the development phase, drainage and water control were established, and then the required infrastructure consisting of power, mine office and maintenance facilities, lignite stockpile facilities, and roadways were established.

The Red Hills Mine began operations in the MS-002 permit area in Mine Area 1 (MA1) and is in the process of transitioning to the MS-004 permit area to Mine Area 3 (MA3). The initial boxcut construction for MA3 began in 2021 and mining in this area will continue through April 2032.

PIT DESIGN
To determine highwall stability, a circular arc failure approach has been utilized. A minimum FoS of 1.2 was calculated using the Modified Bishop Method for each highwall configuration that will be encountered by the mine. Due to the depth and multiple seam nature of the lignite deposit, benching will be required to allow for continuous burden removal and lignite mining. For individual slopes less than 80 feet, the highwall angle is stable up to 70 degrees. Between 80 and 180 feet, the effective slope angle decreases with a line ........

The overall average quality of the mined lignite seams meets the quality specifications stated in the LSA without beneficiation. No mineral processing is performed by MLMC.