TECHNICAL REPORT
HUNZA COAL PROPERTY
BOYACÁ PROVINCE, COLOMBIA
Submitted to:
MMEX MINING CORPORATION
April 15, 2011
Norwest Corporation
Suite 400, 205 – 9th Ave SE
Calgary, Alberta
T2G 0R3
Tel:
(403) 237-7763
Fax: (403) 263-4086
Email calgary@norwestcorp.com
www.norwestcorp.com
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TITLE PAGE
TECHNICAL REPORT
HUNZA COAL PROPERTY
BOYACÁ PROVINCE, COLOMBIA
Submitted to:
MMEX MINING CORPORATION
April 15, 2011
Norwest Corporation
Suite 400, 205 – 9th Ave SE
Calgary, Alberta
T2G 0R3
Tel:
(403) 237-7763
Fax: (403) 263-4086
Email calgary@norwestcorp.com
www.norwestcorp.com
Author:
LAWRENCE D. HENCHEL, PG
MMEX MINING CORPORATION
TECHNICAL REPORT HUNZA PROPERTY, COLOMBIA
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TABLE OF CONTENTS
1 2 3 4 5 6 7 TITLE PAGE ................................................................................................................................. 1-1 TABLE OF CONTENTS .............................................................................................................. 2-1 SUMMARY .................................................................................................................................... 3-1 INTRODUCTION AND TERMS OF REFERENCE ................................................................ 4-1 RELIANCE ON OTHER EXPERTS .......................................................................................... 5-1 PROPERTY DESCRIPTION AND LOCATION ...................................................................... 6-1 ACCESSIBILITY, CLIMATE, LOCAL RESOURCES, INFRASTRUCTURE AND
PHYSIOGRAPHY ......................................................................................................................... 7-1 HISTORY ....................................................................................................................................... 8-1 GEOLOGICAL SETTING ........................................................................................................... 9-1 9.1
REGIONAL STRATIGRAPHY .................................................................................... 9-1
9.2
COAL OCCURRENCES ........................................................................................... 9-2
9.3
STRUCTURAL GEOLOGY........................................................................................ 9-2 DEPOSIT TYPES ........................................................................................................................ 10-1 MINERALIZATION ................................................................................................................... 11-1 EXPLORATION .............................................................................................................. 12-1
12.1
REGIONAL MAPPING AND FIELD SAMPLING .......................................................... 12-1
12.2
OUTCROP MEASUREMENTS AND SAMPLING ......................................................... 12-1
DRILLING ................................................................................................................................... 13-1 SAMPLING METHOD AND APPROACH ............................................................................. 14-1 SAMPLE PREPARATION, ANALYSES AND SECURITY .................................................. 15-1 DATA VERIFICATION ............................................................................................................. 16-1 ADJACENT PROPERTIES ....................................................................................................... 17-1 MINERAL PROCESSING AND METALLURGICAL TESTING ........................................ 18-1 18.1
REGIONAL QUALITY CHARACTERISTICS ............................................................... 18-1
18.2
COAL QUALITY OF THE HUNZA AREA .................................................................. 18-1 MINERAL RESOURCE AND MINERAL RESERVE ESTIMATES ................................... 19-1 OTHER RELEVANT DATA AND INFORMATION ............................................................. 20-1 20.1
ENVIRONMENTAL STUDIES .................................................................................. 20-1
20.1.1 ENVIRONMENTAL IMPACT ASSESSMENT............................................................... 20-1
20.1.2 ACCESS ROADS.................................................................................................. 20-1
INTERPRETATION AND CONCLUSIONS ........................................................................... 21-1 RECOMMENDATIONS............................................................................................................. 22-1 REFERENCES ............................................................................................................................ 23-1 CERTIFICATION AND DATE ................................................................................................. 24-1 ADDITIONAL REQUIREMENTS FOR TECHNICAL REPORTS ON DEVELOPMENT
PROPERTIES AND PRODUCTION PROPERTIES ............................................................. 25-1 ILLUSTRATIONS ...................................................................................................................... 26-1 8 9 10 11 12
13 14 15 16 17 18 19 20 21 22 23 24 25 26 MMEX MINING CORPORATION
TECHNICAL REPORT HUNZA COAL PROPERTY, COLOMBIA
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LIST OF TABLES
Table 3.1
Table 3.2
Table 6.1
Table 9.1
Table 11.1
Table 12.1
Table 14.1
Table 18.1
Table 18.2
Table 18.3
Table 19.1
Table 22.1
Table 22.2
Reported Coal Tonnage Estimates ........................................................................ 3-2 Proximate Coal Quality (After Enerming 2010) ...................................................... 3-3 Coal License Details ...............................................................................................6-2 Upper Cretaceous-Paleocene Stratigraphy of Boyacá, Colombia.......................... 9-2 Average Seam Thickness..................................................................................... 11-1 Exploration Methods ............................................................................................. 12-1 Coal Sampling History and Method ...................................................................... 14-1 Proximate Coal Quality (After Enerming 2010) .................................................... 18-2 Ash Mineral Content and Physical Characteristics (After Enerming 2010) .......... 18-3 Statistical Values for Key Quality Parameters (After Hunza 2007) ....................... 18-3 Historical Coal Tonnage Estimates ...................................................................... 19-1 Exploration Budget Estimate ................................................................................ 22-1 Cost Estimate For Washability and Coking Tests ............................................... 22-2 LIST OF FIGURES
Figure 3.1 General Location Map ............................................................................... Section 26
Figure 4.1 Location and Regional Infrastructure .......................................................... Section 26
Figure 6.1 Coal License Areas .................................................................................... Section 26
Figure 9.1 Generalized Columnar Section .................................................................. Section 26
Figure 9.2 Geological Plan Map .................................................................................. Section 26
Figure 11.1 Generalized Columnar Section-Upper Guaduas Formation ...................... Section 26
Figure 12.1 Coal Section Control Point E-1 .................................................................. Section 26
Figure 12.2 Coal Seam Observation Sites .................................................................... Section 26
Figure 22.1 Proposed Drill Hole Locations .................................................................... Section 26
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SUMMARY
The following technical report was prepared by Norwest Corporation (Norwest) for MMEX
Mining Corporation (MMEX), a mineral exploration company based in Dallas, Texas, United
States. It addresses the geology and results of exploration activity of the coal deposits located
within the C. I. Hunza Coal Ltda. (Hunza) property in the Boyacá Province of east-central
Colombia, shown in Figure 3.1. The report provides recommendations for further geological
exploration of the property. The technical report has been prepared in accordance with National
Instrument (NI) 43-101, Form 43-101F1.
The Hunza property is in the Sogamosa-Jerico region and consists of two contiguous Coal
Licenses and 70% of a third contiguous Coal License, comprising a tenured parcel of 567.8
hectares (ha). Hunza, a Colombian metallurgical coal company, has title to permitted coal license
HDH-151 and is co-owner of the title to permitted coal license 050-93. Hunza has a notarized
civil contract with Mr. Zenon Vega to divide the license 050-93 into two parts, with Mr. Vega’s
mining entitlement covering the eastern 30% and Hunza’s entitlement covering the western 70%
of the license. A third license HI6-08001 is contiguous to license HDH-151 and is titled to Mr.
Jose Manuel Cely, one of the owners of Hunza. A small unlicensed area lies between license 05093 and license HI6-08001.
MMEX has entered into an Option and Purchase Agreement, dated January 20, 2010 to acquire
50% of Hunza. The agreement with Hunza is between Armadillo Mining Company (AMC), a
company which is 94.57% owned by Armadillo Holdings Group Corporation (AHGC), a
company which is in turn wholly-owned owned by MMEX.
The Hunza property lies approximately 200km northeast of the city of Bogotá and 25km
northeast of the town of Sogamoso. The property is accessible by road. Unpaved roads connect
the property with a paved highway at the town of Corrales. Active underground mining is
currently conducted at the Hunza III Mine and Zenon Mine and previous small-scale mining has
been documented or observed on the property. The Hunza III Mine is on the portion of License
050-93 controlled by Hunza and produces coal from Seam 40. The Zenon Mine is producing from
Seam 20 and is on the portion of License 050-93 controlled by Mr. Zenon Vega. These mines are
small operations, each producing less than 12,000 metric tonnes per year.
The area of concern to this report has seen small-scale, artisanal mining activity, has been
included in geology and resource studies by governmental agencies and in recent years has
received some attention by companies wishing to exploit the coal deposit. The first recorded
exploration efforts consisted of mapping and sampling of coal seams, performed in 2010 by a
private Colombian consulting firm. There has been no drilling within the licenses to date.
The Hunza property lies within the Paz del Rio region of the Floresta Basin of eastern Colombia
and contains medium volatile bituminous coals of the Upper Cretaceous Guaduas Formation. The
Floresta basin is characterized by folded and faulted igneous, metamorphic and sedimentary rocks
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of Precambrian through Upper Tertiary age. The structural deformation is dominated by inverse
faults and thrust faults, with subsequent development of folds. The Guaduas Formation is
underlain by the Upper Cretaceous Arenisca Tierna (Soft Sandstone) Formation and
unconformably overlain by the Palaeocene Lower Socha Formation. The Guaduas Formation
consists of mudstone, siltstone, sandstone, carbonaceous mudstone, silty and sandy mudstone,
black mudstone and coal seams.
Structural interpretations of the Hunza property portray a rather broad anticline lying between
two synclines that straddle the western and eastern (Pena Negra Syncline) boundaries of the
property. Regional surface mapping conducted by the Colombian government (Ingeominas, 2003)
placed several thrust faults within the boundary of the Hunza Coal Licenses. The existence or
location of these faults is considered speculative at best, as two of the mapped fault locations
were found by the author to be unconformable formation contacts with no evidence of fault
displacement. This interpretation appears to be supported by recent mining activities that have
passed through the supposed fault locations without encountering evidence of faulting.
The coal measures dip to the north-northwest at 15º to 30º and extend beneath the outcrop of the
cliff-forming Socha Sandstone. Overburden depths range from nil along the outcrops of the
Guaduas seams to over 700m in the northeast portion of the license areas, but are generally less
than 500m. The coal seams are relatively thin, ranging from less than a meter to over 5m, but are
typically between 1m and 2m in thickness. Seven coal seams were identified in Guaduas
Formation during the 2010 field activities carried out by Enerming Ltda. (Enerming) for C. I.
Hunza Coal Ltd. Five seams were shown to be persistent and correlatable through the property.
All five coal seams show evidence of past artisanal underground mining. A sixth correlatable
seam was identified by Norwest during the site visit to the property.
Norwest has created a preliminary geologic model from hardcopy data provided by MMEX and
various data available from public sources. The model along with the additional field
measurements collected by Norwest support the field work carried out in 2010.
Two reported coal tonnage calculations have been made for the Hunza Coal property; one by
Enerming in 2010, and the second by Resource Development Company (RDC) in 2009. These
tonnage estimates range between 15Mt and 90Mt and are presented in Table 3.1.
TABLE 3.1
REPORTED COAL TONNAGE ESTIMATES
Year
Company/
Individual
Tonnes
Millions
Units
2009
RDC
>90.0
Metric Tons
2010
Enerming Ltda.
14.96
Metric Tons
Based on Norwest’s review and from validation work performed with the geologic model,
Norwest has found the Enerming representations to be reasonable, although likely very
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conservative. It appears that Enerming, in an attempt to comply with JORC “resource” criteria,
limited their estimates to areas proximal to the outcrop points of observation. RDC used a
calculation of composite coal thickness multiplied by the estimated area underlain by the coal
seams.
Based on a review of the current geologic and field data, Norwest believes a reasonable in-place
coal tonnage estimate for the property would be in the range of 45 to 50 Mt. All of the above
estimates are conceptual in nature and until additional drilling has been performed and the results
analyzed, the estimates presented herein cannot be categorized as estimates of a coal resource
under the standards of the 43-101 guidelines.
There is a limited amount of analytical data available to characterize coal quality for the Hunza
area, including five samples collected from hoppers at artisanal mine mouths in 2007 by Hunza,
two outcrop samples collected in 2007, also by Hunza, and 11 samples collected by Enerming in
2010. Proximate coal quality from Enerming, presented on an as-received basis, is given in Table
3.2. The coal samples were predominantly collected from close inside the openings of both
inactive and active mines. Sampling techniques are described in the Enerming report and as
described are acceptable channel sampling techniques; however, it was noted that all non-coal
partings greater than 0.3m were removed from the samples.
TABLE 3.2
PROXIMATE COAL QUALITY (AFTER ENERMING 2010)
Thickness
(m)
Moisture
%
Sulfur
%
BTU/lb
Upper
1.50
3.26
14.31
24.82
1.01
12,844
M 40
Middle
0.40
3.00
26.41
21.31
2.46
10,876
E-1C
M 40
Lower
2.15
4.79
12.09
24.51
0.86
12,967
E-1
M40
Composite
4.05
4.05
14.33
24.31
1.07
12,715
E-2
M 20
Upper & Middle
2.20
6.54
21.84
20.51
1.36
10,615
5.5
E-3
M 40
Upper
1.90
17.57
5.96
23.54
0.43
9,907
6.0
E-12
M 20
Upper, Middle &
Lower
2.30
3.69
12.08
23.53
0.98
13,226
8.5
E-21A
M 20
Upper
0.60
21.17
5.69
24.19
0.59
9,135
E-21B
M 20
Middle
1.55
15.04
6.44
23.57
0.56
10,216
E-21
M20
Composite
2.15
16.75
6.23
23.74
0.57
9,914
E-22A
M 20
Upper
0.60
11.99
7.87
24.93
0.67
10,715
E-22B
M 20
Lower
1.55
10.57
6.31
24.76
0.52
11,208
E-22
M20
2.15
10.97
6.75
24.81
0.56
11,070
E-25
M 10
2.30
18.87
8.74
22.85
0.50
9,108
Sample
Seam
E-1A
M 40
E-1B
Bench
Upper
Ash
%
Volatile
%
FSI
6.0
As-received basis, partings over 0.3m removed
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The table shows a fairly wide range of values, particularly in moisture and ash content, and a
depressed calorific value for the grade of coal found at Hunza. The variance in moisture and
calorific value is likely due to partial weathering of the samples, as they were collected from
near-surface locations.
The seven samples collected by Hunza would be representative of a “clean coal” as all partings
were removed during their extraction. Analytical results of these samples on an as-received basis
show moisture values ranging from 0.98 to 2.56%, ash ranging from 5.28 to 9.39%, and volatile
matter content ranging from 23.74 to 25.36%. Sulphur content ranges from 0.54 to 1.10% and
calorific value from 14,023 to 14676 Btu/lb. FSI values have a wide range extending from 5.5 to
9.0, but are all in a range for a coal that could be used in coke making. The HGI index ranges
from 85 to 108. Vitrinite content is high in all seven samples ranging from 40.4 to 60.9% and
vitrinite reflectance (mean max %) ranges from 1.03 to 1.27.
It is recommended that a drilling program of seven core holes be completed on the Hunza Coal
Property to collect seam measurements and samples for quality characterization. Norwest has
designed the drilling program to place a substantial portion of the intersected coal seams into
measured and indicated resource categories consistent with the reporting requirements of NI 43101. The exploration drilling program has a budget estimate $568,865 and includes provisions for
hydrologic and geotechnical characterization that will be essential for any future mine planning.
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INTRODUCTION AND TERMS OF REFERENCE
Norwest has prepared this report at the request of MMEX Mining Corporation (MMEX). As
requested, this Technical Report has been prepared in accordance with the current requirements
of National Instrument 43-101, including topics specified in Form 43-101F1. The purpose of the
report is to describe the historically reported geology and coal mineralization located within the
C. I Hunza Coal Ltda. (Hunza) property in the Boyacá Province of east-central Colombia and
present other aspects pertinent to the property’s assessment. The report provides
recommendations for further geological exploration of the property.
Norwest conducted the following tasks in order to describe the geology and provide a range of
potential coal quantity and quality estimates presented in this report:
1. Public domain information and reports were collected and compiled to provide a geologic
overview and historic perspective of exploration and development work performed on the
property to date.
2. Base maps were created for a consistent reference and past work was converted from either
latitude/longitude or local grid systems to UTM Zone 19, WGS 84 coordinates.
3.
Information acquired by Hunza, notably the coal exploration results from Enerming Ltda.
(Enerming) during 2010 and an Information Memorandum produced by RDC in 2009
providing coal tonnage estimates for the property were reviewed and incorporated into the
report as appropriate.
4. A data validation exercise was performed using Enerming coal exploration information and
additional field measurements collected by Norwest to assess the accuracy of the information
and historic interpretations of the coal geology.
5. Specific conclusions and recommendations were drawn from this work and are included in
the following sections of this report.
This Technical Report utilizes historical data collected at the property by past development
groups. The historic data consists of a geologic report compiled by Enerming during 2010 and an
information memorandum regarding the property prepared by RDC in 2009. The Enerming report
included results of surface mapping and channel sampling of the coal seams where accessible.
Estimates of potential coal tonnage and quality were made by Enerming and RDC. Publically
available geologic data has been used as well to form the framework for the property’s geologic
setting.
Norwest personnel were not involved in the historical exploration and therefore cannot address
the methods utilized. The coal quantity and quality data presented is from historical documents
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and was collected during past exploration activities. Norwest has exercised reasonable skill, care
and diligence to assess the historical information acquired during the preparation of this report.
The author visited the Hunza property on February 20, 2011. During this visit, the author
observed evidence of past exploration activities including the field location of sample sites and
locations where seam measurements were collected. The author collected additional field
measurements of coal seams to further validate and augment the previous exploration activities.
Evidence was found during the site visit of past small-scale, artisanal mining at several locations.
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5
RELIANCE ON OTHER EXPERTS
Norwest has prepared this report specifically for MMEX. The findings and conclusions are based
solely on historical documents and information. This report is a synopsis of the exploration
results and interpretations outlined in the documents enumerated as references in Section 23.
The author has not relied on other experts in the preparation of this report. Legal entitlement to
the claimed Coal Licenses has not been confirmed; however, the registered Licensees for the
three Coal Licenses as posted on the Colombian government’s website (Ingeominas/Catastral
Minero Colombiano) are consistent with those represented by MMEX. Other Norwest personnel
assisted in the compilation and translation of the historical documents and the information
contained within.
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PROPERTY DESCRIPTION AND LOCATION
The Hunza property is in the Sogamosa-Jerico region in northeast Boyacá Province of east central
Colombia. It is approximately 25km northeast of the town of Sogamoso and 7km southeast of the
Town of Tasco. The nearest major cities include Bogotá approximately 200km to the southwest,
Medellin 315km to the west and Cucuta 220km to the north. It is centered approximately on
latitude 5°52’00” N and longitude 72°43’16” W as shown in Figure 6.1. The area of concern in
this report has seen small-scale, artisanal mining, has been included in geology and resource
studies by governmental agencies and in recent years has received some attention by companies
wishing to exploit the coal deposit.
The Hunza property is in the Sogamosa-Jerico region and consists of two contiguous Coal
Licenses and 70% of a third contiguous Coal License, comprising a tenured parcel of 567.8
hectares (ha), jointly owned by Hunza, a Colombian metallurgical coal company, and Mr. Jose
Manuel Cely, a Hunza shareholder, as shown in Table 6.1 and illustrated in Figure 6.2.
On April 1, 2011, Armadillo Mining Corporation (AMC), a British Virgin Islands corporation,
owned 94.57 % by Armadillo Holdings Group Corporation, a British Virgin Islands corporation,
which in turn is a wholly-owned subsidiary of MMEX Mining Corporation, U.S Nevada
registered corporation, (listed on the OTC: BB: MMEX), entered into an Option and Purchase
Agreement with Jose Manuel Cely Rodriquez and Jorge Alberto Cely (joint shareholders of
Hunza) and C.I. Hunza Coal Ltda, a Colombia limited liability corporation ( the “Company”) for
the acquisition of 50% of the voting shares of the Company by the payment of the minimum
investments.
AMC agreed to form a Colombian company to acquire the interest when the minimum payments
stipulated in the agreement have been made. Exclusivity payments of US$1,400,000 have been
paid under the agreement by AMC.
As a condition to closing and earning its 50% interest, AMC must invest US$ 5,000,000 to
finance an exploration and drilling program to be agreed upon by both parties under the following
minimum payment schedule (the “Minimum Payment Schedule”):
a) An initial US$ 500,000 shall be paid on or before April 29, 2011.
b) An additional payment of US$500,000 must be paid on or before July 1, 2011.
c) An additional payment of US$1,000,000 must be paid on or before September 1, 2011.
d) An additional payment of US$1,000,000 must be paid on or before November 1, 2011.
e) An additional payment of US$1,000,000 must be paid on or before January 2, 2012.
f) An additional US$ 1,000,000 must be paid on or before March 1, 2012.
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This Minimum Payment Schedule may be accelerated at the option of AMC to earn its 50%
interest upon payment.
The parties have agreed that AMC will engage contractors and third parties for performing the
exploration program. In addition the first US$3,000,000 of the funding will be used to develop
the exploration program; provided, however, that those funds may be used as necessary for
production with unanimous consent.
Hunza has title to permitted coal license HDH-151 and is co-owner of the title to permitted coal
license 050-93. Hunza has a notarized civil contract with Mr. Zenon Vega to divide the license
050-93 into two parts, with Mr. Vega controlling the eastern 30% and Hunza controlling the
western 70%. A third license HI6-08001 is contiguous to license HDH-151 and is titled by Mr.
Jose Manuel Cely, one of the owners of Hunza. A small unlicensed area lies between license 05093 and license HI6-08001.
TABLE 6.1
COAL LICENSE DETAILS
License
Area (ha)
Title Holder
HDH-151
255.4
C.I. Hunza Coal Ltda
HI6-08001
268.3
Mr. Jose Manuel Cely
050-93
Total Area
63.0
586.7
C.I. Hunza Coal Ltda and Mr. Zenon Vega
(567.8 ha. @ 70% of License 050-93)
The current target area for initial mine development is centered around license 050-93. This area
contains the current Hunza III Mine and is currently permitted for mining activities. The mine
produces approximately 10,000 metric tons per year using small-scale, artisanal mining methods.
Current fees for maintaining the coal license is US$1,500.00 per ha per year. Norwest has not
independently verified that the Coal Licenses have been maintained; however, the registered
Licensees for the three Coal Licenses as posted on the Colombian government’s website
(Ingeominas/Catastral Minero Colombiano) are consistent with those represented by MMEX.
Royalties to the Colombian government are at 5% FOB sales price.
Property boundaries are defined by the Colombian Cadastral Office; Norwest has not located
them in the field. The property is permitted for mining and it is unknown whether any
environmental liabilities exist on the property.
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7
ACCESSIBILITY, CLIMATE, LOCAL RESOURCES, INFRASTRUCTURE
AND PHYSIOGRAPHY
The property is located in the Cordillera Oriental of Colombia. The regional topography is
mountainous. The municipality of Tasco is at an elevation of 2,640m and the Hunza III Mine is at
an elevation of approximately 3,475m. The highest elevation on the property is slightly over
4,000m above sea level. The Hunza property has an average temperature of under 80C with
rainfall ranging from 500 to 3,000 millimetres (mm) per year. There are no climatological
impediments to year-round mining activities.
The vegetation of the project area is typical for a tropical, sub-glacial ecosystem, being comprised
of frailejons, shrubs and pasture lands. There is an abundance of swamps containing small lakes
which are the source of most streams that flow into Bobate Mortino stream, the region’s main
water source. Bobate Motrino flows from east to west through the property then north to the Rio
Chicamocha River.
The Hunza property is located in the north-eastern region of the Boyacá province, in the
jurisdiction of the Tasco Municipality. The Hunza property lies approximately 200km northeast
of the city of Bogotá and 25km northeast of the town of Sogamoso. The property is accessible by
road. A paved highway runs from Sogamoso to Corrales and an unpaved road connects to the
town of Tasco. The property is accessed from Tasco via a 13km unimproved road through the
tiny villages of Mortino and Bobate. Electricity is available at the project site, having been run by
Boyaca province in approximately 2006. Water supply is from surface drainages; no supply for
larger-scale commercial operations has been developed but it would likely be sourced through
groundwater wells.
The commercial airport at Bogotá provides air access. Currently transport to Atlantic and Pacific
ports would be via truck or by barge from the port of Barrancabermeja on the Magdalena River.
The Colombian Government is in the process of tendering a concession to build and operate a rail
system connecting Bogotá with the existing FENOCO rail concession that now transports coal
from the Cesar coal fields to the Atlantic ports. This railway would be built along an existing but
out of service railway. This system would also connect to the central area of the Boyacá Province.
Alternatively, if a coal handling facility was constructed at the Magdalena River port of Puerto
Berrio, coal could be transported via barge to the Caribbean port of Barranquilla, where coal
loading facilities currently exist. Additionally, barges can access the port of Cartagena where
there are also coal loading facilities. A river terminal upstream from Barrancabermeja would
significantly shorten the distance of truck haulage for coal properties in Boyaca province.
Sogamoso is the regional center with a population of nearly 200,000. Corrales has a population of
several thousand. The entire region supports communities with experienced miners skilled in the
artisanal methods commonly practiced in the area. Training and import of miners with experience
in mechanized techniques would be required for the development of modern, high-productivity
mining operations.
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8
HISTORY
The government of Colombia has conducted several field mapping expeditions that included the
Hunza region dating from 1944. The area has been mined via small underground coal mines that
generally penetrated less than 50 meters into the seams from outcrop. These mines have operated
sporadically over many years. All mining conducted prior to 1993 was unpermitted and illegal
operations. The first permitted mining began in 1993 with the issuance of permit 050-93. The
area has not been drilled. Hunza purchased its first concession in the area in 2007.
Hunza contracted RDC in 2009 to write an Information Memorandum on the property. The
document was a desktop review that compiled existing information and no new field work or
exploration was performed.
Hunza retained Enerming to conduct a field investigation in 2010. This field investigation
included the examination of old mine openings to obtain seam thickness and lithology details and
to collect strike and dip measurements of the bedding. The opening for the inactive Zenon mine
was examined. A coal section was also obtained from the working face of the Hunza III mine.
Coal samples were also obtained during this investigation.
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GEOLOGICAL SETTING
The Hunza property lies within the Paz del Rio region of the Floresta basin (also referred
to as Floresta Massif) of eastern Colombia and contains medium volatile bituminous
coals in the Upper Cretaceous Guaduas Formation. The Floresta basin is characterized by
folded and faulted igneous, metamorphic and sedimentary rocks of Precambrian through
Upper Tertiary age. The regional structural deformation is dominated by inverse faults
and thrust faults, with subsequent development of folds. The Guaduas Formation is
underlain by the Upper Cretaceous Arenisca Tierna (Soft Sandstone) Formation and
unconformably overlain by the Palaeocene Lower Socha Formation. The Guaduas
Formation consists of mudstone, siltstone, sandstone, carbonaceous mudstone, silty and
sandy mudstone, black mudstone and coal seams. Coal seams are restricted to the upper
portion of the Guaduas Formation.
The structural regime of the area has been influenced by repeated episodes of orogeny
associated with the mountain building of the Andes and Colombia’s Eastern Cordillera.
The Eastern Cordillera has been moulded primarily through Cenozoic shortening, or
compressive motion caused by collision of the Pacific-margin plates. The eastward
compression has tended to form north-south trending thrust blocks with shallow dips to
the west. Folds vary from shallow, broad-limbed structures to tight, steeply dipping and
plunging features.
9.1
REGIONAL STRATIGRAPHY
The coal-bearing units occurring in the Paz del Rio region are within the Guadaus
Formation. The Upper Cretaceous-age coal seams were subjected to varying depths of
burial prior to the early to middle Tertiary deformation and mountain-building episodes.
The subsequent structural deformation resulted in increased pressures and heat flows that
have imparted metallurgical properties to the coal seams as evidenced from the vitrainite
reflectance, swelling characteristics, and overall maturity of the coal seams.
A summary of the typical stratigraphy for the Hunza property area is shown in Table 9.1.
The stratigraphic units occurring within the property range between the Arenisca Tierna
Formation and Upper Socha Formation, all of which have surface exposures within the
property. Areas of lower elevation and shallower slopes are frequently covered with a
mantle of Quaternary colluvium or stream bed alluvium which prevents mapping of
bedrock geology.
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TABLE 9.1
UPPER CRETACEOUS-PALEOCENE STRATIGRAPHY OF BOYACÁ, COLOMBIA
Upper
Socha
Mudstone and, siltstone with interbedded of sandstone
Lower
Socha
Fine to medium grained sandstone with minor interbedded mudstone
Upper
Guaduas
Mudstone, siltstone, sandstone, carbonaceous mudstone, silty and
sandy mudstone, black mudstone and coal
Lower
Guaduas
Mudstone, siltstone and fine to medium grained sandstone
Arenisca
Tierna
Fine to medium grained light to dark grey and yellowish sandstone
planar with minor cross bedding
Paleocene
Upper
Cretaceous
9.2
COAL OCCURRENCES
The coal seams occurring within the property are contained within the Guaduas
Formation, as illustrated in Figure 9.1. The Guaduas Formation consists of dark grey
mudstone, siltstone, fine to medium-grained sandstone, carbonaceous mudstone, silty and
sandy mudstone, coaly plant debris, black mudstone and coal. Seven coal seams have
been identified, however only five have been utilized in historical reserve estimates. An
upper seam, previously unidentified and averaging 1.55m in thickness, was mapped by
Norwest for a strike-line distance of over 300m just below the Upper Guaduas-Lower
Socha Formation contact. This seam has been designated as Seam 60.
Overlying the Guaduas Formation is the Lower Socha Formation. The Lower Socha
Formation is a fine to medium grained white, gray, brown and yellowish gray sandstone
with minor light gray to reddish interbedded layers of mudstone. It is a major cliffforming unit in the area.
A detailed discussion of the coal seam stratigraphy of the Hunza property follows in
Section 11.
9.3
STRUCTURAL GEOLOGY
Structural interpretations of the Hunza property portray a rather broad anticline
(Tuvitatame Anticline) lying between two synclines that straddle the western (Tuvitatame
Syncline) and eastern (Pena Negra Syncline) boundaries of the property, illustrated in
Figure 9.2. Regional surface mapping conducted by the Colombian government
(Ingeominas, 2003) placed several thrust faults within the boundary of the Hunza
licenses. The existence or location of these faults is considered speculative at best, as two
of the mapped fault locations were found by the author to be unconformable formation
contacts with no evidence of fault displacement. This interpretation appears to be
MMEX MINING CORPORATION
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supported by recent mining activities that have passed through the supposed fault
locations without encountering evidence of faulting. Drilling and additional field
mapping or trenching will be necessary to form a more accurate structural interpretation
of the property.
The coal measures dip to the north-northwest at 15º to 30º and extend beneath the outcrop
of the cliff-forming Socha Sandstone. Overburden depths range from nil along the
outcrops of the Guaduas seams to over 700m in the northeast portion of the license areas,
but are generally less than 500m. The coal seams are relatively thin, ranging from less
than a meter to over 5m, but are typically between 1m and 2m in thickness. Seven coal
seams were identified in Guaduas Formation during the 2010 field activities carried out
by Enerming Ltda. (Enerming) for C. I. Hunza Coal Ltd. Five seams were shown to be
persistent and correlatable through the property. All five coal seams show evidence of
past artisanal underground mining. A sixth correlatable seam was identified by Norwest
during the site visit to the property.
Figure 9.2 shows the seams and sample locations as mapped by Enerming and Norwest.
These occur along the southeast-facing exposure in the southwestern portion of the
license areas. Given the poor exposures and thick colluvial cover on slopes underlying
the Lower Socha cliffs to the east, it is considered possible that Upper Socha coals may
exist in this area. These are drawn as inferred (dashed) lines and bear further
investigation through either drilling or trenching to determine if there may be additional
occurrence of Upper Guaduas coal seams in the southeast portions of the property.
Reports of coal outcrops below the Lower Socha contact to the east of the license
boundary should be investigated and traced onto the license if possible.
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10
DEPOSIT TYPES
The definition of “Deposit Type” for coal properties is different from that applied to other
types of geologic deposits. Criteria applied to coal deposits for the purposes of
determination of coal resources and reserves include both “Geology Type” as well as
“Deposit Type”. For coal deposits this is an important concept because the classification
of a coal deposit as a particular type determines the range-limiting criteria that may be
applied during estimation of reserves and resources.
“Geology Type” for coal deposits is a parameter that is specified in Geological Survey of
Canada (GSC) Paper 88-21, which is a guideline reference for coal deposits as specified
in NI 43-101. Geology Type is a definition of the amount of geological complexity,
usually imposed by the structural complexity of the area, and the classification of a coal
deposit by Geology Type determines the approach to be used for the resource/reserve
estimation procedures and the limits to be applied to certain key estimation criteria. The
identification of a particular Geology Type for a coal property defines the confidence that
can be placed in the extrapolation of data values away from a particular point of reference
such as a drill hole.
The classification scheme of GSC Paper 88-21 is similar to many other international coal
classification systems but it has one significant difference. This system is designed to
accommodate differences in the degree of tectonic deformation of different coal deposits
in Canada. The four classes of geologic complexity, from lowest to highest, are:




Low
Moderate
Complex
Severe
Based on the data available and existing geological interpretation, Norwest has
determined coal mineralization to be of the moderate geology type. Though the regional
geology shows some structural complexity, all coal measures within the Hunza property
are contained within a single fault block bounded by the Las Granjas and Tuvitatame
faults (Figure 9.2). The bedding within the fault block generally dips 15º to 30º towards
the north. There does not appear to be any significant offsets within the coal-bearing
sequence.
“Deposit Type” as defined in GSC Paper 88-21 refers to the extraction method most
suited to the coal deposit. There are four categories, which are “surface”, “underground”,
“non-conventional”, and “sterilized”. The Hunza deposit, based on the reported coal
thicknesses, depth of the coal occurrence below ground surface in the areas, is considered
to be an “underground” deposit type.
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11
MINERALIZATION
The mineralized zones encountered on the property are predominantly medium volatile
bituminous coal seams, with minor increase or decrease in rank depending on
stratigraphic variations and depth of burial. Prior coal quality reports indicate that the
coals will, with beneficiation (washing) to remove impurities, produce a product with
coking properties suitable for metallurgic applications. Coal production from the Hunza
III Mine is currently sold to Coal Colombia, a local “consolidator” or broker. Thermal
coal suitable for electric power generation can be produced with or without further
processing in addition to, or as an alternative to, a coking coal product.
Seven coal seams occurring in the upper Guaduas Formation have been found to occur on
the property during historic investigations. Of these, five have been identified by
Enerming as having sufficient thickness and continuity for correlation across significant
areas. Figure 9.1 showed the generalized stratigraphic column of the Guaduas coals
occurring at Hunza, with the positions of major seams. Figure 11.1 shows the coalbearing section in detail and includes the recently identified Seam 60.
Historic tonnage estimates have focused on five of these seams. Table 11.1 shows the
average thicknesses of these seams taken from historic outcrop or mine opening
measurements.
TABLE 11.1
AVERAGE SEAM THICKNESS
Seam
Thickness (m)
M 50
1.50
M 40
2.72
M 30
0.80
M 20
1.82
M 10
2.30
A brief summary of selected seam descriptions excerpted from the Enerming report is
provided below.
Seam M 50
Seam M 50 was described at location E-4 as 1.20m coal, 0.20m mudstone and 0.50m of
coal.
Seam M 40
As described at the face of the Hunza III Mine (location E-1) Seam M 40 consisted of
1.50m coal, 0.30m mudstone, 0.40m coal, 0.30m soft mudstone, 0.30m coal, 0.02m
mudstone, 0.85m coal, 0.08m black mudstone and 0.90m coal.
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Seam M 30
At location E-13 Seam M 30 was described as 0.80m of solid coal with no partings.
Seam M 20
Seam M 20 was described at location E-2 as 1.30m coal, 0.20m mudstone and 0.70m
coal.
Seam M 10
At location E-25 seam M 10 has been described as 0.78m coal, 0.02m black mudstone,
0.89m coal, 0.05m black mudstone and 0.51m coal.
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12
EXPLORATION
The periods and types of coal exploration undertaken on the property are summarized
in Table 12.1. The coal exploration methods can be separated into two types: regional
mapping and field sampling.
TABLE 12.1
EXPLORATION METHODS
Year
12.1
Company/Individual
Exploration Activity
1944
National Geological Survey
Regional mapping
1981
INGEOMINAS
Regional mapping
1990
Carbones de Boyacá S.A.
Regional mapping
1991
S.A. CARBOCOL
Regional mapping
1995
ECOCARBON
Regional mapping
2003
INGEOMINAS
Regional mapping
2004
INGEOMINAS
Regional mapping
2010
Enerming
Field sampling
REGIONAL MAPPING AND FIELD SAMPLING
From 1944 to 2004, coal exploration on the Hunza property was largely restricted to
mapping coal and rock. This work was largely conducted by governmental agencies
and private concerns. Small-scale mining has also been conducted on the property
since the early 1940’s. No records of this mining are available, therefore the coal
thicknesses encountered, the extent of the old workings or the quality of the coal is
unknown.
The most comprehensive coal exploration to be conducted on the Hunza Property was
done by Enerming in 2010. The exploration activities encompassed surface mapping,
examination of past mine entries and exposed coal crops and sampling from six abandon
or inactive mine entries and the active face of the Hunza III Mine. The location of the
measured locations and sample sites are illustrated in Figure 12.1.
12.2
OUTCROP MEASUREMENTS AND SAMPLING
During the 2010 program, Enerming examined 25 coal outcrops and/or abandoned,
inactive or active mine portals. Enerming collected samples from 6 inactive mine entries
and one sample from an active mine face for the purpose of coal quality testing. The
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samples were obtained utilizing hand tools. At the active Hunza III Mine separate
samples were obtained from each of the three plies of coal identified for the M 40 coal
seam. At two other sampling locations two separate coal plies were sampled for the M 20
coal seam. The only other coal seam sampled was the M 10 seam
The following measurements and observations were made by Enerming at the sample
sites, excerpted from exploration reports:

Bedding attitude measurements for strike and dip were collected for roof and seam at
each sample site.

Apparent and true thickness measurements

Coal characteristics including hardness, brightness, fractures, and primary macerals.

Lithologic characteristics of rock partings, if present, were noted in the seams at all of
the observation points.
Figure 12.2 is an example of a typical coal section from the sampling conducted by
Enerming. A brief summary of the geologic mapping complied for each seam is
provided below.
Seam 50
Seam 50 is the upper most seam of the Guaduas Formation and contains three separate
units: an upper coal bench between 0.30m and 1.20m in thickness, a mudstone parting
0.20m to 0.30m thick and a lower coal bench 0.50m to 1.00m in thickness. The interval
between Seam 50 and Seam 40 is approximately 60m and has been described as a
sequence of mudstone and siltstone with thin interbeds of sandstone.
Seam 40
The Hunza III Mine is producing from Seam 40. At the mine, Seam 40 consists of three
distinct coal benches separated by dark gray mudstone partings for a total thickness of
4.65m. The upper coal bench is 1.50m thick. A 0.30m mudstone parting separates the
upper bench from the middle bench of coal, 0.40m thick. A second mudstone parting of
0.30m thick with minor coal bands separates the middle bench from the lower bench of
coal, 2.15m thick and containing minor streaks of clay. The interval separating Seam 40
and Seam 30 is described as mudstone and siltstone with interbeds of sandstone. Interval
thickness is approximately 50m. Two thin, unnamed coal seams, each approximately
0.20m thick, occur approximately 20m and 30m below the floor of Seam 40.
An in-mine exploration hole was being driven by hand into the roof coal of a ventilation
adit for the mine. A measurement of 4.8m true thickness was observed, which included
0.7m of a carbonaceous shale parting.
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Seam 30
Seam 30 occurs as a single band of bright coal averaging 0.80m thick. The interval
between seams 30 and 20 is predominantly black mudstone, 14m in thickness.
Seam 20
Seam 20 consists of an upper coal bench 0.60m to 1.30m thick, a dark gray to black
mudstone parting 0.20m, and a lower coal bench that varies from 0.70m to 1.80m thick.
The floor to Seam 20 is a fine-grained sandstone 5.6m thick, followed by silty mudstone,
approximately 23m thick. Interburden thickness between Seam 20 and Seam 10 is
approximately 28.6m. Seam 20 was mined at the Zenon Varga and at several other
abandoned locations.
Seam 10
Seam 10 is the lowermost seam found in the Hunza area. Seam 10 consists of bright coal
with a thickness of 2.30m. The seam contains two thin clay bands, 0.02m and 0.05m
occurring near the top and bottom of the seam respectively.
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13
DRILLING
To date no drilling has been conducted on the Hunza property.
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14
SAMPLING METHOD AND APPROACH
Although small-scale, artisanal mining has occurred on or near the Hunza properties for
many years; MMEX does not have access to any of the past mining shipped qualities. As
mentioned previously, Hunza had Enerming conduct a field mapping and sampling
program in 2010. The number and methods of sampling for that program are summarized
in Table 14.1. The location of Enerming observation and sampling points have been
shown in Figure 12.1.
TABLE 14.1
COAL SAMPLING HISTORY AND METHOD
Year
Reference
Company/ Individual
Type Sample
2007
Hunza
Wm. McGuire (consultant)
Stockpile/Crop
2010
Hunza
Enerming
Channel
Number
Samples
7
11
Coal samples obtained by Enerming were collected via the following methods.

Samples were obtained from the walls of inactive and /or abandoned mine openings
and the active face of the Hunza Mine.

The walls were cleaned of foreign material.

Plastic was placed below the area to be sampled to avoid contamination.

A channel was cut via hand tools. This channel was approximately 0.30m wide and
between 0.20m and 0.50m in depth.

The sample was homogenized and divided until an approximate 20kg sample was
obtained.

The seam was sampled by not including partings of over 0.30m with the coal, any
parting less than 0.30m was included with the coal.
Hunza sampling consisted of “grab” samples, 2 from outcrops and 5 from hoppers
outside of artisanal mine mouths. The samples did not include partings nor are they
representative of a full vertical seam quality profiles. Samples were sealed and packaged
for transport to the laboratories.
The sampling methods as described by Enerming, i.e. representative channel samples cut
from seam exposures just inside of existing mine openings, are to current industry
standards. The Enerming samples do seem to have been negatively impacted by nearMMEX MINING CORPORATION
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14-1
surface exposure and some degree of weathering, as evidenced by the relatively high
moisture values and depressed calorific values. The Hunza samples might be considered
as indicative of “clean coal” quality, and while not being representative of the in-situ
coal seam quality from which they were extracted, are useful in determining the rank
and coking suitability of the coals, particularly after beneficiation through either
selective mining or coal processing (washing).
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15
SAMPLE PREPARATION, ANALYSES AND SECURITY
Enerming collected 11 samples during their field study of the Hunza coal property in
2010. The coal samples were transported to the Inspectorate Colombia Ltda. laboratory in
Barranquilla, Colombia for analysis. Hunza collected 7 samples under the supervision of
a contracted consultant and through Inspectorate Colombia had them analyzed in the
USA at CoalTech Petrographic Associates, Inc. with the aim of obtaining some
characterization of metallurgical properties.
Sample preparation methods are not documented, but techniques for coal typically consist
of grinding a sample, homogenizing it and extracting representative samples in sizes
appropriate for the various coal analyses. Due to the relatively uniform nature of coal as
opposed to minerals such as precious metals, sophisticated sample preparation techniques
are typically not applied.
The Inspectorate laboratories are internationally recognized and carry certifications for
analysis of many types of commodities, including solid fuels such as coal. CoalTech
Petrographic Associates are known in the industry, particularly the North Appalachian
region of the US, but their certifications are unknown.
Coal sampling and testing programs do not typically adhere to the regimen of check or
replicate assays common in the minerals and metals industries. No validation of
laboratory results has been performed.
Proximate analyses for moisture, ash, volatile matter, sulphur, and fixed carbon along
with calorific value was completed for all 11 Enerming samples. In addition four
samples were subjected to tests for equilibrium moisture, ash mineral content, Hardgrove
Grindability Index (HGI), Free Swelling Index (FSI), specific gravity, and petrographic
analysis (maceral content).
Specific laboratory sample preparation procedures are not known for these samples, but it
is assumed that Inspectorate has followed standard coal laboratory practices. The
transport and handing of these samples has not been documented and extended periods of
coal exposure to the atmosphere may have impacted the measurement of volatile matter
and moisture content in the coal samples. In addition, it is likely that some of the samples
were of partially weathered coal, which would exhibit higher moisture content, lower
volatile matter content and calorific value, and lower FSI values than fresh (unweathered)
coal samples.
In coal work special security methods and chain of custody procedures for the shipping
and storage of samples are not commonly employed, as coal is a relatively low value bulk
commodity.
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16
DATA VERIFICATION
During the site visit conducted on February 20, 2011, the author checked and verified locations
where Enerming had collected seam measurements and samples including the Hunza III and
Zenon Vega Mines. The author also collected additional field measurements from 15 outcrop
locations and identified another potentially mineable and laterally persistent coal seam located
above Seam 50. This seam has been named Seam 60.
The Enerming measurements of coal seam thickness were validated to the satisfaction of the
author.
For the purposes of verification, Norwest has produced a preliminary geologic model using coal
exploration data accumulated by Enerming, the available geologic and topographic mapping for
the area, and the field measurements collected by the author. The preliminary model has been
used to evaluate the available geologic information for the Hunza property. The preliminary
geologic model and surface features were all standardized to the UTM Zone 18 (WGS84 datum)
coordinate system.
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17
ADJACENT PROPERTIES
No information from adjacent properties was used in the preparation of this technical
report.
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18
MINERAL PROCESSING AND METALLURGICAL TESTING
The equivalent terminology used in this report is “Coal Quality and Processing”.
18.1
REGIONAL QUALITY CHARACTERISTICS
In the Hunza area, coals of the Guaduas Formation are primarily ranked as medium
volatile bituminous. The influence of depth of burial will increase or decrease coal
maturity and rank depending on relatively deep or shallow burial respectively. Suitability
of these coals for coke making, either directly or by pulverized coal injection, is
determined through rheological testing and petrographic analysis on a seam-by-seam
basis. Coal from the Hunza III Mine is currently sold as metallurgical coal to Colombian
Coal, a local consolidator/exporter who provides coal to an international trading
company, Nobel Energy.
18.2
COAL QUALITY OF THE HUNZA AREA
There is a limited amount of analytical data available to characterize coal quality for the
Hunza area that includes five samples collected from the mine mouth hopper at the
Hunza III Mine in 2007 by Hunza, two outcrop samples collected in 2007, also by Hunza,
and eleven samples collected by Enerming in 2010. Four of the Enerming samples are
from Seam 40, six are from Seam 20, and one sample is from Seam 10. There are
currently no in-situ coal quality samples for Seams 30 and 50. Future coal quality testing
will need to be carried out in a systematic manner that adequately represents all
potentially mineable coal seams both spatially and on a ply-by-ply basis.
The samples collected by Enerming in 2010 are from six abandoned and/or inactive
mines and one active mine mouth, sampled near-surface just inside the mine openings.
Proximate and calorific values for the Enerming samples are presented in Table 18.1 on a
raw coal, as-received basis.
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TABLE 18.1
PROXIMATE COAL QUALITY (AFTER ENERMING 2010)
Sample
Seam
Bench
Thickness
(Meters)
%
Moisture
%
Ash
%
Volatile
% MAF
Volatile
%
Sulfur
BTU/lb
E-1 Hunza III Mine
M 40
Upper
1.50
3.26
14.31
24.82
30.11
1.01
12,844
E-1 Hunza III Mine
M 40
Middle
0.40
3.00
26.41
21.31
30.19
2.46
10,876
E-1 Hunza III Mine
M 40
Lower
2.15
4.79
12.09
24.51
29.49
0.86
12,967
E-1 Composite
M40
4.05
4.05
14.33
24.31
29.79
1.07
12,715
E-2
M 20
Upper &
Middle
2.20
6.54
21.84
20.51
28.64
1.36
10,615
E-3
M 40
Upper
1.90
17.57
5.96
23.54
30.78
0.43
9,907
E-12
M 20
Upper,
Middle
& Lower
2.30
3.69
12.08
23.53
27.94
0.98
13,226
E-21
M 20
Upper
0.60
21.17
5.69
24.19
33.07
0.59
9,135
E-21
M 20
Middle
1.55
15.04
6.44
23.57
30.02
0.56
10,216
E-21 Composite
M20
2.15
16.75
6.23
23.74
30.87
0.57
9,914
E-22 Zenon Mine
M 20
Upper
0.60
11.99
7.87
24.93
31.11
0.67
10,715
E-22 Zenon Mine
M 20
Lower
1.55
10.57
6.31
24.76
29.79
0.52
11,208
E-22 Composite
M20
2.15
10.97
6.75
24.81
30.16
0.56
11,070
E-25
M 10
2.30
18.87
8.74
22.85
31.57
0.50
9,108
Upper
The table shows a fairly wide range of values, particularly in moisture and ash content,
and a depressed calorific value for the grade of coal found at Hunza. The variance in
moisture and calorific value is likely due to partial weathering of the samples, as they
were collected from near-surface locations. The higher volatile contents of three of the
samples may be due to having been partially oxidized. Ash contents range from a
desirable 5.7% to as much as 26.4%. Future mining may require blending or washing to
produce a metallurgical coal product with lower ash content.
In addition to proximate analyses, four of the samples were also tested for equilibrium
moisture, ash mineral content, Hardgrove Grindability Index (HGI), Free Swelling Index
(FSI), and specific gravity. These results are shown in Table 18.2. The HGI index ranges
from 85 to 120 for the four samples and FSI values range from 5.5 to 8.5. Both indices
are in the desirable ranges for metallurgical coal.
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TABLE 18.2
ASH MINERAL CONTENT AND PHYSICAL CHARACTERISTICS (AFTER ENERMING 2010)
Sample
Parameter
E3
E2
SiO2
51.69
60.90
61.42
60.90
Al2O3
22.01
22.69
22.69
26.15
TiO2
1.43
1.16
1.26
1.53
Fe2O3
12.32
8.75
5.48
4.64
CaO
3.27
0.76
1.18
0.71
MgO
0.98
0.56
0.56
0.57
Na2O
0.20
0.04
0.43
0.24
K2O
0.28
1.89
0.96
1.34
P2O5
1.08
0.43
2.13
0.43
SO3
4.38
0.08
1.02
0.58
Undetermined
2.36
2.74
2.87
2.91
Hardgrove Grindability Index (HGI)
111
85
96
120
Free Swelling Index (FSI)
6.0
5.5
8.5
6.0
1.34
1.48
1.39
1.37
Ash Composition (%)
Specific Gravity g/cm
3
E12
E25
The seven samples collected by Hunza in 2007 were shipped to Inspectorate Colombia,
who then arranged shipment of the samples to CoalTech Petrographic Associates, Inc. in
Pennsylvania for metallurgical testing. Analytical tests included proximate and ultimate
analysis, ash composition, FSI, plasticity, dilatation, HGI, petrography, and ash fusion
temperatures. All seven samples were approximately 50 kg in size. Average and range in
values for key quality parameters from the Hunza samples is presented in Table 18.3.
TABLE 18.3
STATISTICAL VALUES FOR KEY QUALITY PARAMETERS (AFTER HUNZA 2007)
Parameter Moisture Ash Volatile Matter Sulfur Calorific Value FSI Max. Fluidity Hardgrove Mean Max Reflectance (%) Minimum Maximum
0.98
2.56
5.28
9.39
23.74
25.36
0.54
1.10
14,023
14,676
5.5
9.0
2
4,865
85.6
107.7
1.03
1.27
Average 1.37 7.22 24.53 0.71 14,322 7.5 2,394 94.2 1.13 MMEX MINING CORPORATION
TECHNICAL REPORT HUNZA COAL PROPERTY, COLOMBIA
18-3
All seven samples exhibit similar proximate values. FSI values have a wide range
extending from 5.5 to 9, but are all in a range that could be used in coke making. The
HGI index ranges from 85 to 108. Fluidity characteristics appear to be good, with a low
value of 2 dial divisions per minute (ddpm) and a high of 4,865 ddpm. The low fluidity
value is an outlier as the majority of the values are above 2,000 ddpm, which is desirable
in a metallurgical coal. Vitrinite reflectance (mean max %) ranges between 1.03 and 1.27,
characteristic of medium volatile bituminous coals.
The Hunza samples would be considered as representative of a “clean coal” as all
partings were removed during extraction. While not being representative of the in-situ
coal seam quality from which they were extracted, they are useful in determining the
rank and coking suitability of the coals, particularly after beneficiation through either
selective mining or coal processing (washing).
MMEX MINING CORPORATION
TECHNICAL REPORT HUNZA COAL PROPERTY, COLOMBIA
18-4
19
MINERAL RESOURCE AND MINERAL RESERVE ESTIMATES
The most recent prior report outlining coal tonnage estimates was completed in 2010 by
Enerming. A second tonnage estimate had been previously presented by Resource
Development Company (RDC) in 2009. The criteria and procedures used in these
estimates are undocumented and /or unverifiable, and for this reason are not NI 43-101
compliant and are not classified as mineral resource or mineral reserve estimates of any
category of assurance.
Table 19.1 provides a historical summary of the total coal tonnage estimates on the
Hunza property. The methods used by Enerming to estimate coal tonnages were
described in their report and are listed below. Based on Norwest’s review and from
validation work performed with the geologic model, Norwest has found the Enerming
representations to be reasonable, although likely very conservative. It appears that
Enerming, in an attempt to comply with JORC “resource” criteria, limited their estimates
to areas proximal to the outcrop points of observation.
TABLE 19.1
HISTORICAL COAL TONNAGE ESTIMATES
Year
Company/
Tonnes
Individual
Millions
Units
2010
Enerming
14.96
Metric Tonnes
2009
RDC
>90.0
Metric Tonnes
Procedures and criteria used by Enerming in their estimate include the following:
1. For seams M 10, M 20, M 40 a radius of 1,000m was used for tonnages estimates due
to the number of observation points and for seams M 30 and M 50 due to a minimum
of data points a radius of 250 was utilized for tonnage estimates.
2. Tonnage estimate were constrained by seam outcrops, property boundaries and the
axes of the Tuvitatame anticline.
3. The Zenon Vega portion of title 050-93 was excluded.
4. Coal seams with thickness above 0.8m were included. Partings above 0.15m were
excluded.
5. The dips of the coal seams were corrected to flat planes by dividing the areas by the
cosine of the dip.
6. A coal density of 1.30 was used.
7. A mining loss of 10% was factored into the tonnage estimates.
MMEX MINING CORPORATION
TECHNICAL REPORT HUNZA COAL PROPERTY, COLOMBIA
19-1
RDC used a calculation of composite coal thickness multiplied by the estimated area
underlain by the coal seams, which was calculated to be 440ha. The total composite seam
thickness or density is not specified.
Based on a review of the current geologic and field data, Norwest estimates that there are
approximately 324 ha of land within the permitted property with coal-bearing strata, to a
maximum depth of 600m. Enerming has identified a combined average thickness 9.1m
in five seams and Norwest identified a sixth seam that adds another 1.5m to the combined
thickness. A more likely coal tonnage estimate for the property is in the range of 45 to
50Mt. An exploration drilling program will greatly facilitate knowledge on the potential
tonnage.
Given the lack of procedural documentation for the prior estimates and the lack of
drilling and sampling data throughout the property, none of the estimates given above are
compliant to NI 43-101 standards and are not considered estimates of a mineral resource
or reserve of any assurance category.
MMEX MINING CORPORATION
TECHNICAL REPORT HUNZA COAL PROPERTY, COLOMBIA
19-2
20
OTHER RELEVANT DATA AND INFORMATION
There is no additional relevant data or information applicable to this report.
20.1
ENVIRONMENTAL STUDIES
No environmental studies were presented to Norwest for review.
20.1.1 Environmental Impact Assessment
No environmental impact assessments were available to Norwest for review.
20.1.2 Access Roads
No plans for alternate access roads were presented to Norwest for review. There is an
unpaved road that is currently utilized to haul coal from the mines in the area that
transects the property.
MMEX MINING CORPORATION
TECHNICAL REPORT HUNZA COAL PROPERTY, COLOMBIA
20-1
21
INTERPRETATION AND CONCLUSIONS
The 2010 Enerming report for the Hunza property provides an initial base study on
potential coal tonnage of the Hunza property. The RDC report provides what is judged to
be the high estimate for the range of prior tonnage calculations. Enerming has collected
field measurements and samples for five coal seams that appear to have mineable
thicknesses with lateral extents and continuity to be of economic interest. The additional
measurements collected by the author during the site visit support the findings of
Enerming. Further, the author has identified a sixth coal seam of economic interest.
The coal occurrence at Hunza is primarily of medium volatile bituminous rank. The
“geology type” is determined to be moderate based on Geological Survey of Canada
Paper 88-21.
Enerming has estimated a potential coal tonnage of 14.96 Mt. The review of exploration
data and the construction of an independent geologic model lead Norwest to believe that
these estimates, while not compliant with NI 43-101 criteria, are reasonable, albeit
conservative. RDC has reported an estimated tonnage of 90Mt. Norwest believes a more
likely tonnage estimate is in the 45 to 50 Mt range.
The Hunza property is in a very early stage of exploration and the area containing points
of observation limited to surface outcrop exposures and occurrence within shallow
artisanal adits. The estimation of the quantity and quality contained within the Hunza
licenses is at this point conjectural due to the lack of drilling across the majority of the
property. Coal quality data is limited to near surface exposures that have likely been
negatively impacted by weathering (depressed calorific values and FSI’s), and to “grab”
samples from mined coal stockpiles. The latter may demonstrate the potential for clean
coal product quality but does not truly represent the quality of the in-place coal seams.
MMEX MINING CORPORATION
TECHNICAL REPORT HUNZA COAL PROPERTY, COLOMBIA
21-1
22
RECOMMENDATIONS
The field measurements and sampling that have been carried out on the Hunza coal
property indicate sufficient coal quantity and quality to warrant an exploration drilling
program. It is recommended that a 7 hole program be completed to collect seam
measurements and core samples for quality characterization. Total penetration for the
drilling based on existing field data is approximately 2,640m. This program is designed
to place a substantial portion of the intersected coal seams into classified resources
consistent with the reporting requirements of NI 43-101. In addition, it is recommended
that at least two drill holes be completed as groundwater monitoring wells in order to
begin collecting baseline data for hydrologic characterization. It is also considered
prudent to begin collecting geotechnical data and rock mechanic samples from at least
three of the proposed drill holes to support future mine planning and design. Proposed
drilling locations are shown in Figure 22.1.
If the results of exploration are favorable, MMEX should consider a bulk sampling
program utilizing large diameter core or bulk samples obtained from the artisanal adits.
Sufficiently large samples are needed for washability studies and for more detailed
analysis and potential product determination. Metallurgical analysis of the bulk samples
using current international tests and methodologies is considered necessary to represent
any potential product in today’s marketplace.
Table 22.1 itemizes costs for the proposed 7 hole exploration drilling program. It assumes
that holes are predominantly cored for coal quality and geotechnical data. It allows for
the establishment of three groundwater monitor wells as well as providing for the
updating of the geologic model and the preparation of a resource report.
TABLE 22.1
EXPLORATION BUDGET ESTIMATE
Component
Cost
Drilling and Coring Operations
$320,000
Geophysical Logging
$14,000
Site and Access Construction
$65,000
Coal Quality Analysis
$11,200
Washability Analysis
$4,350
Project Management/Wellsite Geologists
$36,000
Monitor Well Completion
$23,000
Surveying
$3,600
Geologic Model Update/Resource Reporting
$40,000
Contingency 10%
$51,715
Total
$568,865
MMEX MINING CORPORATION
TECHNICAL REPORT HUNZA COAL PROPERTY, COLOMBIA
22-1
Estimated costs for the second recommended phase of work are given in Table 22.2.
These are based on the acquisition of suitable samples of six discrete seams by means of
bulk sample adits driven from surface. Washability and metallurgical testing costs are
based on the six bulk samples undergoing a standard suit of analyses that would permit
preliminary washability studies and characterization of coking properties for the Hunza
coals.
TABLE 22.2
COST ESTIMATE FOR WASHABILITY AND COKING TESTS
Component Sample Acquisition Washability Analyses Metallurgical Quality Testing Total Cost (US$) $6,000
$120,000
$30,000
$156,000
MMEX MINING CORPORATION
TECHNICAL REPORT HUNZA COAL PROPERTY, COLOMBIA
22-2
23
REFERENCES
Alvarado, B; Sarmiento, R. 1944. Informe Geológico sobre los yacimientos de hierro,
carbón y caliza de la región Paz de Rio, Depatamento de Boyacá. Serv. Geol. Nal.,
Informe 468, inedito. Bogotá.
ECOCARBÓN, 1995. El carbón. Empresa Colombiana de Carbones. 41p. Bogotá.
Canadian Securities Administrators, 2005, National Instrument 43-101 Standards of
Disclosure for Mineral Projects, Form 43-101F1, Technical Report, and Companion
Policy 43-101CP.
Carbones de Boyacá S.A. 1990. Evaluación de reservas carboniferas de Boyacá, Cuenca:
Sogamoso-Jericó, Subcuenca: Corrales, Gameza, Tasco, Tópaga, Mongua. Departamento
Técnico. 145p. Tunja.
Enerming Ltda., 2010, Hunza Coal Project. 39 p. Bogotá.
INGEOMINAS, 2004. El Carbón Colombiano. Recursos, Reservas y Calidad. 470p
Bogotá.
INGEOMINAS , 2003, Geología de la Plancha 172, Paz de Río. Memoria explicative.
Escala 1:100,000. Por: Ulloa, C., Rodríguez, G. Instituto de Investigación e Información
Geocientifica, Minero-Ambiental y Nuclear. 111 p. Bogotá.
Lopez, L., y Perez, V., 1991, Evaluación Geologica Preliminar de los Carbones de Socha.
(Departamento de Boyacá). Carbones de Colombia S.A. CARBOCOL. 98 p. Bogotá.
Renzoni, G., 1981, Geologia del Cuadrángulo J – 12, Tunja. INGEOMINAS, Bol. Geol.
24 (2). Pp31 – 48. Bogotá.
The Resource Development Company Ltd., 2009, Hunza Information Memorandum,
Presented to C.I. Hunza Ltda.
MMEX MINING CORPORATION
TECHNICAL REPORT HUNZA COAL PROPERTY, COLOMBIA
23-1
24
CERTIFICATION AND DATE
CERTIFICATE of AUTHOR
The effective date of publication of this technical report is April 15, 2011.
Dated this 15th day of April, 2011.
“ORIGINAL SIGNED AND SEALED BY AUTHOR”
______________________________________
Lawrence D. Henchel, PG
Manager Geologic Services, Norwest Corporation
Following is a signed and dated Certificate of Qualifications of the person who prepared
this report.
MMEX MINING CORPORATION
TECHNICAL REPORT HUNZA COAL PROPERTY, COLOMBIA
24-1
CERTIFICATE OF QUALIFICATION
I, Lawrence D. Henchel, PG, do hereby certify that:
1. I am currently employed as Manager of Geologic Services by Norwest Corporation, Suite
1200, 136 East South Temple Street, Salt Lake City, Utah 84111 USA.
2. I graduated with a Bachelor of Science Degree in Geology from Saint Lawrence
University, Canton, NY, USA in 1978.
3. I am a licensed Professional Geologist in the State of Utah, #6087593-2250.
4. I have worked as a geologist for a total of twenty-seven years since my graduation from
university.
5. I have read the definition of “qualified person” set out in National Instrument 43-101 (NI
43-101) and certify that by reason of my education, affiliation with a professional
association (as defined in NI 43-101) and past relevant work experience, I fulfill the
requirements to be a “qualified person” for the purposes of NI 43-101.
6. I personally visited the Hunza Property on February 20, 2011.
7. I am responsible for the preparation of Sections 1 through 26 of the report titled
“Technical Report, Hunza Coal Property, Boyacá Province, Colombia” dated April 15,
2011 (the “Technical Report”).
8. As of the date of this certificate, to the best of my knowledge, information and belief, the
Technical Report contains all scientific and technical information that is required to be
disclosed to make the Technical Report not misleading.
9. I am independent of the issuer applying all of the tests in Section 1.4 of NI 43-101.
10. I have had no prior involvement with the property that is the subject of this Technical
Report.
11. I have read NI 43-101 and Form 43-101F1, and the Technical Report has been prepared
in compliance with that instrument and form.
Dated at Salt Lake City, Utah this 15th Day of April, 2011.
MMEX MINING CORPORATION
TECHNICAL REPORT HUNZA COAL PROPERTY, COLOMBIA
24-2
CONSENT of AUTHOR
To:
British Columbia Securities Commission
Alberta Securities Commission
Saskatchewan Financial Services Commission
Manitoba Securities Commission
Ontario Securities Commission
Autorité des Marchés Financiers du Québec
New Brunswick Securities Commission
Nova Scotia Securities Commission
Prince Edward Island Securities Office
Securities Commission of Newfoundland and Labrador
Northwest Territories Securities Commission
Government of Yukon Securities Registrar
Registrar of Securities, Legal Registries Division, Department of Justice, Nunavut
I, Lawrence D. Henchel, P.G., author of the Technical Report titled “Technical Report, Hunza
Coal Property, Boyacá Province, Colombia” dated April 15, 2011 (the “Technical Report”) do
hereby:
a) Consent to the public filing of the Technical Report titled “Technical Report, Hunza Coal
Property, Boyacá Province, Colombia” dated April 15, 2011, and
b) Confirm that I have read the written disclosure being filed and that it fairly and accurately
represents the information in the Technical Report that supports the disclosure (if
required for final report submittal).
Dated this ____th Day of April, 2011.
“ORIGINAL SIGNED AND SEALED BY AUTHOR”
______________________________________
Signature of Qualified Person
Lawrence D. Henchel, PG
Name of Qualified Person
MMEX MINING CORPORATION
TECHNICAL REPORT HUNZA COAL PROPERTY, COLOMBIA
24-3
25
ADDITIONAL REQUIREMENTS FOR TECHNICAL REPORTS ON
DEVELOPMENT PROPERTIES AND PRODUCTION
PROPERTIES
The Hunza property, although having experienced small-scale, artisanal mining, has had
such limited and sporadic production that it is not considered a developed property. There
have been no engineering studies or financial analyses which could be reported in the
context of NI 43-101. The production is conducted by pick-and-shovel methods with no
coherent mine planning.
MMEX MINING CORPORATION
TECHNICAL REPORT HUNZA COAL PROPERTY, COLOMBIA
25-1
26
ILLUSTRATIONS
Figure 3.1 General Location Map ................................................................................ Section 26
Figure 4.1 Location and Regional Infrastructure Map .................................................. Section 26
Figure 6.1 Coal License Areas .................................................................................... Section 26
Figure 9.1 General Columnar Section Hunza Property ................................................ Section 26
Figure 9.2 Geological Plan Map .................................................................................. Section 26
Figure 11.1 Generalized Columnar Section-Upper Guaduas Formation ...................... Section 26
Figure 12.1 Coal Seam Observation Sites .................................................................... Section 26
Figure 12.2 Coal Section Control Point E-1 .................................................................. Section 26
Figure 22.1 Proposed Drill Hole Locations .................................................................... Section 26
MMEX MINING CORPORATION
TECHNICAL REPORT HUNZA COAL PROPERTY, COLOMBIA
26-1
Rosa Blanca
CARTAGENA
El Carmen
Malaga
Aratoca
Santander
CUCUTA
Gala
Arauca
Carcasi
MEDELLIN
SAN GIL
BOGOTA
El Espine
Mogotes
SOCORRO
Tame
Hato la Rivera
Rio Chic
Chima
amocha
Coromoro
Puerto Rondon
Pueblo Viejo de Ura
Hato Corozal
Hato La Osa
Mapurisa
Suaita
Guepsa
Chitaraque
Velez
Paz de Rio
Curital
Barbosa
Llano de Perez
Paz de Ariporo
La Cigarra
Tasco
DUITAMA
Casanare
Paipa
Pore
SOGAMOSO
Hato Los Laureles
Soboya
Guasimai
CHIQUINQUIRA
TUNJA
Boyaca
El Caucho
Hato Las Flumas
El Paraiso
Yopal
Ubate
Guayabal
Aguazul
FIGURE 3.1
LEGEND
Hunza Coal Property
Province Boundaries
Rivers and Streams
Roads
Towns and Cities
HUNZA COAL PROPERTY
GENERAL LOCATION
0
10
20
KILOMETERS
30
MAP
CARTAGENA
La Guajira
CUCUTA
BARRANCABERMEJA
MEDELLIN
Pueto Berrio
BOGOTA
Atlantico
Magdalena
Cesar
Sucre
Bolivar
Panama
Venezuela
Cordoba
Magdalena Ri
ver
Norte De
Santander
BARRANCABERMEJA
Antioquia
Santander
Arauca
Pueto Berrio
Choco
Casanare
Boyaca
Caldas
LEGEND
Hunza Coal Property
Province Boundaries
Rivers and Streams
Roads
Railroad
Towns and Cities
Cundiuamarca
FIGURE 6.1
HUNZA COAL PROPERTY
LOCATION AND REGIONAL
0
20
80
KILOMETERS
120
INFRASTRUCTURE MAP
750000
750500
751000
751500
752000
752500
753000
753500
754000
754500
650500
755000
650500
3600
4000
00
38
650000
650000
Current Track: 20 FEB 2011 06:52
3400
HDH-151
649500
649500
3200
38
00
38
00
00
36
649000
HI6-08001
050-93
649000
3600
3800
3400
648500
Zenon Mine
Hunza 3 Mine
3400
648500
36
00
0
350
3400
648000
648000
36
00
751000
751500
752000
752500
753000
753500
754000
754500
755000
FIGURE 6.2
LEGEND
Hunza Coal Property
Road/Trail line
Topography
HUNZA COAL PROPERTY
COAL LICENSE
0
100
200
METERS
300
400
AREAS
LEGEND
Carbonaceous
Mudstone
Sandstone
>150m
Mudstone Member
Interbedded Mudstone
and Siltstone
Siltstone
130 - 292m
220 -156m
Sandstone Member
Coal Seams
Coal Bearing
Sequence
100 - 120m
130 - 180m
Lower
230 - 395
Guaduas Formation
Soft Sandstone
Formation
Upper Cretaceous
Upper
Socha Formation
Paleocene
Quaternary
Sediments
FIGURE 9.1
General Columnar
Section of the
Hunza Coal Property
750000
750500
751000
751500
Tpsi
Tpsi
Ksgs
752000
752500
753000
753500
754000
754500
Tpss
650500
3600
4000
00
38
Qi
650000
3400
Tpsi
Qi
649500
00
38
3200
Tpss
38
0
0
00
36
Ksgs
649000
Tpsi
Ksgi
Ksg
3600
3800
3400
Ksgs
Ksgi
3400
648500
Qi
36
00
0
350
3400
Ksg
648000
36
00
LEGEND
Qi
Quaternary
Tpss
Upper Socha Formation
Access Road
Topographic Contour
Seam 10
Bedding
Seam 20
Tpsi
Lower Socha Formation
Ksgs
Upper Guaduas Formation
Postulated Faults
Ksgi
Lower Guaduas Formation
Syncline Axis
Ksg
Gudualupe Formation
Syncline Axis
Quaternary
FIGURE 9.2
Outcrops
(Dashed Where Inferred)
HUNZA COAL PROPERTY
GEOLOGICAL
Seam 30
Seam 40
Seam 50
Seam 60
PLAN MAP
0
100
200
METERS
300
400
755000
Thickness
(m)
LEGEND
Carbonaceous
Mudstone
1.5
Interbedded Mudstone
and Siltstone
Seam 60
Sandstone
23.5
1.5
Siltstone
Coal Seams
Seam 50
60
1.5
4.65
Seam 40
.0.3
0.4
0.3
Coal Bearing Sequence
158 m
Upper Guaduas Formation
Upper Cretaceous
2.15
.2m
38.3
.2m
11.7
2.0
Seam 30
14.0
2.0
5.6
Seam 20
23.0
2.0
Seam 10
FIGURE 11.1
Generalized Columnar
Section of the
Coal Bearing Sequence,
Upper Guaduas Formation
Hunza Coal Property
11
10
11'
10'
9
9'
8
8'
7
6
0
7'
6'
5
4
0
38
2'
3
ADO ORT
LIN NSP
INC TRA
DE
E
2
E-11
1
0
E7
E-24
0
36
E-6
E-5
322
3
rte
o
sp
an
e tr
od
ad
lin
Inc
12'
13
12
2
E-25
11
10
1
9
14'
E 25
8
7
6
ns
Tra
5
4
In
na
cli
do
de
15
po
rte
14
E-22
3
2
E-21
1
E-18
E 21
E-15
20
17
19
16
Niv
el
2
18
E-14
E-13
E-17
E-12
15
21
22
ad
o
14
3
ba
Tra
2
jos
tig
An
1
s
uo
9
s
uo
tig
e
An
ort
sp
jos
an
e tr
od
29
ba
Tra
ad
8`
E 11
31
32
33
34
36
4
7
28
30
BM Hunza 3
lin
Inc
5
6
8
el
1
10
25
26
27
Niv
Inu
nd
13
12
11
24
23
35
E-11
37
38
E1
39
EXP-1
LEGEND
Qi
Quaternary
Tpss
Upper Socha Formation
Proposed Drill Holes
Access Road
Topographic Contour
Seam 10
Bedding
Seam 20
Tpsi
Lower Socha Formation
Ksgs
Upper Guaduas Formation
Postulated Faults
Ksgi
Lower Guaduas Formation
Syncline Axis
Ksg
Gudualupe Formation
Syncline Axis
Quaternary
FIGURE 12.1
Outcrops
(Dashed Where Inferred)
HUNZA COAL PROPERTY
COAL SEAM
Seam 30
Seam 40
Seam 50
Seam 60
OBSERVATION SITES
0
50
METERS
100
LEGEND
SEAM 40
Carbonaceous
Mudstone
Thickness (m)
Carbonaceous mudstone
with minor coal streaks and
mica
Interbedded Mudstone
and Siltstone
Sandstone
Siltstone
Coal Seams
Sample A
Coal, hard, bright, banded
vitrinite, concordal fractures
.3
Carbonaceous mudstone
.4
Bright vitrinite coal
.3
Carbonaceous mudstone
with bright coal bands
.3
Coal, alternating bands of
dull and bright vitrinitic coal
4.65
Sample B
1.5
.02
Clay
Coal, vitrinitic
.85
Sample C
.08
Carbonaceous mudstone
.9
Coal, bright, hard, vitrinitic
FIGURE 12.2
Carbonaceous mudstone
Coal Section
Control Point
E-1
750000
750500
751000
751500
752000
752500
753000
753500
754000
754500
650500
3600
4000
00
38
EXP-5
EXP-6
350m
560m
650000
3400
EXP-3
EXP-4
230m
400m
649500
EXP-7
EXP-2
00
3200
8
3250m
450m
38
0
0
00
36
EXP-1
649000
400m
3600
3800
3400
3400
648500
36
00
0
350
3400
648000
36
00
LEGEND
EXP-1
Proposed Drill Holes
Outcrops
(Dashed Where Inferred)
FIGURE 22.1
Seam 10
HUNZA COAL PROPERTY
Seam 20
Access Road
Seam 30
Topographic Contour
Seam 40
PROPOSED DRILL
0
200
400
Seam 50
Seam 60
METERS
600
800
HOLE LOCATIONS
755000