Cockatoo Coal : Baralaba North Reserve Report

COAL RESERVE REPORT BARALABA NORTH COAL DEPOSIT‌‌‌‌‌‌‌‌‌‌‌‌‌‌‌‌‌‌ BARALABA COAL COMPANY LIMITED

Queensland, Australia

Prepared For‌‌

BARALABA COAL COMPANY LIMITED‌‌‌

By‌‌‌

John T. Boyd Company

Mining and Geological Consultants Brisbane, Australia‌

Report No. 5153.005

DECEMBER 2016

John T. Boyd Company‌

Mining and Geological Consultants

Chairman

James W. Boyd

President and CEO

John T. Boyd II

Managing Director and COO

Ronald L. Lewis

Vice Presidents Richard L. Bate Robert J. Farmer James F. Kvitkovich Russell P. Moran Donald S. Swartz John L. Weiss Michael F. Wick William P. Wolf

Managing Director - Australia

Ian L. Alexander

Managing Director - China

Iisheng (Jason) Han

Managing Director - South America

Carlos F. Barrera

Managing Director - Metals

Gregory B. Sparks

Assistant to the President

Mark P. Davic

Brisbane

John T. Boyd Company (Australia) Pty. Ltd.

ABN 76 095 540 417

Level 11

388 Queen Street

Brisbane, QLD 4000

61 7 3232-5000

61 7 3232-5050 Fax

[e-mail]

Pittsburgh (Headquarters)

[phone]

[e-mail]

Denver

[phone]

[e-mail]

Beijing

86 10 6500-5854

[e-mail]

Bogota

[phone]

[e-mail]

www.jtboyd.com

16 December 2016

File: 5153.005

Baralaba Coal Company Limited Level 7

10 Eagle Street

Brisbane QLD 4000

Attention: Mr Brian Wyatt

Interim CEO

Subject: Coal Reserve Report

Baralaba North Coal Deposit Baralaba Coal Company Limited

Dear Sir

This report presents John T. Boyd Company's [BOYD] Reserve Report for the Baralaba North coal deposit. The reported reserve has been prepared in accordance with the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves, 2012 Edition.

In preparing this report, we undertook a rigorous review and compilation of available data for the deposit. Several site visits were undertaken by Mr McSpadden, BOYD Principle Engineer prior to completion of the report.

Respectfully submitted,

JOHN T. BOYD COMPANY

By:

John T. Boyd II President and CEO

U:BOYD_PROJECTS5153.005 Cockatoo Coal Reserve Statement Baralaba NthBOYD ReportFinal5153.005 Cvr_Ltr.docx

TABLE OF CONTENTS

Page

LETTER OF TRANSMITTAL TABLE OF CONTENTS

1. GENERAL STATEMENT 1-1

2. Introduction 1-1

3. Project Overview 1-1

4. Scope of Work 1-2

5. Data Provided to BOYD 1-3

6. Disclaimer 1-3

7. Statement of Interest 1-3

8. BOYD Qualifications 1-4

9. JORC Declaration 1-4

10. Mine Design and Scheduling 1-4

11. Financial Assessment and Reserves Reporting 1-4

12. Figure 1.1: General Location Map 1-6

13. EXECUTIVE SUMMARY 2-1

14. Conclusion 2-1

15. Statement of Compliance 2-1

16. Tenure Status 2-2

17. Geological Setting 2-2

18. Mine Status 2-3

19. Technical Assessment 2-3

20. Mining Method 2-3

21. Mining Strategy 2-4

22. Pit Limits 2-4

23. Coal Handling and Transport 2-5

24. Economic Mining Validation 2-6

25. Coal Market and Revenue Assumptions 2-6

26. Cost Estimation 2-6

27. Financial Analysis 2-7

28. Reserve Reconciliation 2-8

29. Figure 2.1: Mine Infrastructure Layout, Baralaba North Mine 2-9

30. PROJECT DESCRIPTION 3-1

31. Location 3-1

32. Concession and Permits 3-1

33. General Description and Land Use 3-2

34. Climate and Rainfall 3-2

Figure 3.1: Map Showing Baralaba North Tenements 3-3

TABLE OF CONTENTS - Continued

Page

1. GEOLOGY AND 2016 REPORTED RESOURCES 4-1

2. Geology Setting 4-1

3. Coal Quality 4-2

4. Exploration 4-2

5. Seam Stratigraphy 4-3

6. Geological Modelling 4-3

7. Seam Interpretation 4-4

8. Topography 4-4

9. Structure 4-4

10. Coal Quality 4-5

11. In Situ Moisture 4-5

12. Resource Classification Criteria 4-6

13. Reasonable Prospects for Eventual Economic Extraction 4-6

14. Points of Observation 4-7

15. Resource Limits 4-7

16. Confidence Criteria 4-8

17. Resource Estimate - Baralaba North 4-8

18. Estimated Coal Quality 4-10

19. Figures

20. 1: Structural Features 4-11

21. 2: Cross Sections 4-12

22. 3: Generalised Columnar Section, Baralaba North Mine 4-13

1. MINE DESIGN, COAL HANDLING AND TRANSPORT 5-1

2. Mine Setting 5-1

3. Mining Limits 5-1

4. Design Criteria 5-2

5. Mining Strategy 5-3

6. Coal Handling 5-5

7. ROM Crushing and Screening 5-5

8. Coal Washing 5-5

9. Product Coal Transport 5-5

10. Coal haulage to the Train Loadout Facility 5-5

11. Train Loadout Facility 5-5

12. Railing and Port 5-5

13. Figures

    Map Showing

14. 1: Pit and Dump Areas, Baralaba North Mine 5-7

15. 2: Mine Infrastructure Layout, Baralaba North Mine 5-8

16. 3: Coal Transport Route to Port Baralaba North Mine 5-9

1. COAL RESERVE ESTIMATION PROCESS 6-1

2. Background 6-1

3. In Situ Reserve Generation 6-1

4. Modifying Factors 6-2

5. Seam Aggregation 6-2

6. Loss and Dilution 6-3

7. Moisture Adjustment 6-3