Clines Key Points....Wow....o New Elk Coal Company has assembled a contiguous acreage comprising 18,555 acres
(7,508.9 hectares).
o The acreage is estimated to host a demonstrated a total in-situ coal resource of 315
million tons (285.7 million metric tonnes) of coal in the measured and indicated
categories. An additional 35 million tons (31.7 million metric tonnes) falls within the
inferred category.
o This coal is hosted in three main coal seams that range from 4 feet to over 10 feet in
thickness.
o All three seams may possibly be accessed through the existing Allen (New Elk) mine
workings, but the workings are currently flooded and will have to be pumped dry in order
to provide access.
o A small coal mine, the Allen Mine (New Elk Mine) designed to produce 1,500,000 short
tons of coal per year, operated on a portion of the property for 8 years. It has been closed
since 1989.
o In addition to the mine, a 550 ton per hour coal preparation plant is located on the site.
This plant was operated as recently as 2002 and processed coal from the short-lived
Lorencito Coal Company mine.
o Waste from the mine and preparation plant is stowed in a refuse disposal site immediately
across the highway from the mine site.
o During its history, operational problems at the preparation plant caused a significant
amount of fine coal to be lost in the washing process.
o New Elk is planning to upgrade the washing plant with more modern technology to
minimize this problem and expects to rewash some of the reject material to recover a
portion of the fine coal in the reject pile.
o New Elk has mining permits that, with slight revisions, should allow restarting of the
mine with minimal startup time. These permits will probably have to have their
reclamation bonds increased in order to reflect increased costs since the permits were
initially issued.
o The coal is low sulphur and, when properly washed, low in ash as well. It has good
coking property and is classed as a high to medium volatile coking coal. It may be
utilized for both coking and thermal power generation.