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2.04.6 - GEOLOGY DESCRIPTION <br />• REGIONAL GEOLOGY <br />The following description is excerpted from the NEDO Project Geological <br />Report, contained in relevant part in Appendix 4. Additional detailed <br />information regarding regional and project site geology is contained in <br />that report. <br />The King I Mine and the King II Mine lie at the northwest edge of the San <br />Juan Basin, covering approximately 26,000 square miles of northwestern <br />New Mexico and southwestern Colorado. The sedimentary strata of the <br />basin were deposited at the western margin of a vast epeirogenic sea <br />occupying the central area of the North American continent during the <br />late Cretaceous Epoch. Extensive deposition of coal forming materials <br />occurred during a succession of regressive/ transgressive migrations of <br />the shoreline in northeast (seaward) / southwest (landward) direction. <br />With each successive cycle the maximum transgressive cycle shifted to <br />the northeast until the final disappearance of the sea. The ultimate <br />result was a jagged wedge of non - marine sediments in the southwestern <br />area of the basin, intermingling with marine strata to the northeast. <br />With each transgressive cycle accumulated the transitional strata of <br />barrier beach, marginal shore swamps (coal bearing), paludal (coal <br />bearing), and other lower coastal plain deposits. <br />LOCAL GEOLOGY <br />The local area is characterized by southerly to southeasterly dipping; <br />sedimentary rocks of late Cretaceous age which has been deeply eroded <br />to the north. <br />The uppermost formation exposed locally is the Cliff House Formation, <br />which is the upper member of the Mesa Verde Group. It is of marine <br />origin and is composed of irregular to lenticular ledges of hard, fine to <br />medium grained, calcareous sandstone in softer argillaceous fine <br />sandstone, mudstone and silty shale. The top of this formation has been <br />removed by erosion, leaving an average thickness of 350 feet. The Cliff <br />House Formation overlies the Menefee Formation. <br />The Menefee Formation, which is the middle member of the Mesa Verde <br />Group, is composed of a complex assemblage of cross - bedded <br />sandstones, black shales and coal beds. Up to seven coal seams have <br />been identified by the U. S. Geological Survey. The Menefee Formation <br />has an average local thickness of 300 feet. The Menefee overlies the <br />Point Lookout Formation. <br />GCC Energy, LLC King II Mine <br />Section 2.04.6 <br />Page 1 October, 2008 <br />TR -/� <br />