2015-12-15_GENERAL DOCUMENTS - C1981035 (3)

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Report on GCC Energy Coal Transport Options rate. Thus, this method is likely more expensive than discontinuous methods described above. Other continuous haulage methods require higher capital investment than a conveyor and are not considered feasible for this application. Any continuous method would require an elevated structure from the King II Mine loadout to cross public roads and the shortest route to a truck loadout adjacent to State Highway 140 for subsequent loading of over -the -road trucks. It is unlikely that use of a conveyor would be lower cost as compared with over -the -road or off- highway trucks on a single use road. Use of off-road trucks on a single use road away from residences along CR120 to a site adjacent to State Highway 140 would be an alternative to current practice of over -the -road trucks using CR120 from the King II Mine loadout to State Highway 140. A cost comparison between these methods could show which has lower impact and may provide a solution to the truck traffic concerns of local citizens. Elements of a comparison of methods may include the following: 1. Life of use/mine 2. Description of each methods including environmental considerations, ie. noise, light, emissions/dust, etc. 3. Preliminary design — plan and profile 4. Property ownership and acquisition required 5. Roadway construction and maintenance cost 6. Haulage equipment cost 7. Haulage equipment operating cost 8. Reclamation cost 9. Net present value calculation 10. Impact comparison/assessment 11. Summary of findings GCC Energy utilizes two stockpiles at the mine site. The estimated capacity of each is 7,500 tons and accommodates approximately 4 to 6 days of mine production based on the 2014 annual production rate. Low storage volume requires that coal be hauled from the mine site on a daily basis or production would stop. Relative Cost of the Northern vs. Southern Routes Distance measurements to a common point on State Highway 140 from the King II Mine loadout shows that the Northern route using CR120 and State Highway 140 is approximately 3.5 miles longer than the Southern Route. Assuming that the over -road -truck cost is $4.50 per loaded mile, this additional distance equals approximately $0.525/ton higher cost for the Northern route than the Southern route. This comparison does not consider elevation difference in the transport route as it is assumed this would be negligible given speed limits currently in place as well as possible increase of speed limit to 40 miles per hour with proposed upgrades to existing CR120. MINE ENGINEERS, INC. 6 December 15, 2015