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E <br />Lease C-024998 --- 2550.92 Acres <br />1. Carbonera Seam <br />The Carbonera coal zone overlies the Cameo at distances <br />ranging from 38 to 93 feet on this lease, averaging 64 feet. This range <br />includes two holes in which present correlations are doubtful (CC -76-1 <br />and CC -76-6). The Carbonera throughout its extent appears to be a <br />series of detached coal seams and lenses rather than a distinct bed, <br />making correlation difficult. In some areas, such as in Coal Canyon to <br />the northwest of this lease, the entire interval from the top of the <br />Rollins Sandstone to the top of the Carbonera zone contains so many coal <br />beds of variable thickness that even differentiation between the two <br />. groups is difficult. While the interval is fairly distinct on this <br />lease, the Carbonera zone itself contains from one to ten beds, thus <br />making correlations of individual beds between holes virtually impossible. <br />In making reserve calculations the thickest bed or beds in each hole <br />were correlated. The seam is multiple bedded in virtually all holes, <br />although it is much more homogenous and consistent in the southern part <br />of the lease than in the northern part. (See "Carbonera Seam - Drill <br />Hole Data"). <br />For the calculation of "mineable reserves" 968.62 acres were deducted <br />due to the partings inherent in the Carbonera in the west and southwest <br />portions of the lease. It is possible some of this coal could be mined <br />but until there is more information available it appears most unlikely. <br />As previously inferred, the Carbonera appears to thicken and become <br />• considerably cicane!. toward the southeast end of the lease. The following <br />table shows individual thicknesses and depths determined by drilling. <br />