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Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
February 2022
Prepared for:
Coronado Global Resources Inc.
100 Bill Baker Way
Beckley, West Virginia 25801
Prepared by:
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
582 Industrial Park Road
Bluefield, Virginia 24605
www.mma1.com
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
1
Statement of Use and Preparation
This Technical Report Summary (
TRS
) was prepared by
Marshall Miller & Associates, Inc. (
MM&A
)
for the sole use of
Coronado Global Resources Inc. (
Coronado
)
and its affiliated and subsidiary
companies and advisors. Copies or references to information in this report may not be used without
the written permission of Coronado.
This report provides a statement of coal resources and coal reserves for Coronado, as defined under
the
Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves
(
JORC Code
) as well as under Subpart 1300 of Regulation S-K (Regulation S-K 1300) promulgated by
the
United States Securities and Exchange Commission (
SEC
)
.
report was also prepared in accordance with the
Australasian Code for Public Reporting of
Technical Assessments and Valuations of Mineral Assets
(
VALMIN Code
).
The statement is based on information provided by Coronado and reviewed by Scott Peterson, CPG;
and Justin S. Douthat, PE, MBA.
As noted above, this report is a “Public Report” for the purposes of the VALMIN Code. However, in
accordance with paragraph 12.1 of the VALMIN Code, it is noted that this report is not a “Valuation
of Mineral Assets
”,
and it also does not comply with the following requirements that apply to
“Technical Assessments” (as defined in the VALMIN Code):
This report does not include a determination of the status of tenure (as required by paragraph
7.2 of the VALMIN Code) on the basis that tenure was separately reviewed by Coronado’s legal
advisors.
This report does not include separate commentary on the reasonableness and quality of the
Resources and Reserves estimates and the basis on which they have been reported (as required by
paragraph 7.3 of the VALMIN Code). MM&A did not consider that this was appropriate in
circumstances where MM&A was engaged for the specific purpose of preparing those estimates
and the Resource estimates were prepared by Scott Peterson and the Reserve estimates were
prepared by Justin Douthat, both of whom are authors of this report. However, MM&A notes that,
in accordance with its usual practice, a separate team of MM&A employees undertook a peer review
of this report and confirmed that both the process followed by the authors of this report and the
estimates prepared were reasonable and comply with the requirements of the JORC Code.
Justin Douthat is a licensed Professional Engineers and Registered Member of the
Society of Mining
Engineers (
SME
)
, Golden, Colorado, USA. Scott Peterson is a Registered Member of the
American
Institute of Professional Geologists
(
AIPG
)
. SME and AIPG are
Recognized Professional
Organizations (
RPOs
)
. Both are full-time employees of Marshall Miller & Associates, Inc. and
recognized as a
Qualified Persons
(
QPs
).
The information in this TRS related to coal resources and reserves is based on, and fairly represents,
information compiled by the QPs. At the time of reporting, MM&A’s QPs have sufficient experience
relevant to the style of mineralization and type of deposit under consideration and to the activity
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Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
2
they are undertaking to qualify as a QP as defined by the SEC and the JORC Code. Each QP consents
to the inclusion in this report of the matters based on their information in the form and context in
which it appears.
Marshall Miller & Associates, Inc. (
MM&A
)
contained in this report dated December 31, 2021, relating to estimates of coal resources and coal
reserves controlled by Coronado.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
3
This report was prepared by:
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
/s/ Scott Peterson
February 18, 2022
Scott Peterson, CPG
Sr. Principal Geologist
Direct Line: +1 304 809 0630
Email: scott.peterson@mma1.com
Date of Signature
/s/ Justin S. Douthat
February 18, 2022
Justin S. Douthat, PE, MBA
Executive Vice President
Direct Line: +1 304 809 0597
Email: justin.douthat@mma1.com
Date of Signature
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
1
Table of Contents
1
1
1.1
1
1.2
2
1.3
2
1.4
2
1.5
3
1.6
3
1.7
3
1.8
4
1.9
5
1.10
6
1.10.1
10
1.10.2
10
1.11
11
1.12
11
2
11
2.1
Registrant and Terms of Reference
11
2.2
12
2.3
12
3
12
3.1
12
3.2
13
3.3
13
3.4
14
3.5
14
4
14
4.1
Topography, Elevation and Vegetation
14
4.2
14
4.3
14
4.4
15
4.5
15
5
15
5.1
15
5.2
15
6
16
6.1
16
6.2
17
6.3
18
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
2
7
19
7.1
19
7.2
20
7.3
20
7.4
21
7.5
21
8
22
8.1
22
8.2
22
9
23
9.1
23
9.2
23
9.3
23
10
23
10.1
Testing Procedures
23
10.2
Relationship of Tests to the Whole
24
10.3
24
10.4
24
11
24
11.1
25
11.1.1
26
11.2
29
11.3
30
12
30
12.1
30
12.2
32
12.3
33
13
33
13.1
33
13.2
34
13.3
35
13.4
36
13.4.1
Mine: Pangburn
36
13.4.2
38
13.4.3
39
14
40
14.1
40
14.2
Requirements for Energy, Water, Material and Personnel
40
15
41
16
41
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
3
16.1
41
16.2
42
16.3
42
17
43
17.1
43
17.2
43
17.3
43
17.4
44
17.5
44
17.6
44
18
45
18.1
45
18.2
45
19
47
19.1
47
19.2
49
19.3
53
20
54
20.1
54
21
54
22
55
22.1
55
22.2
55
22.2.1
56
22.2.2
56
22.2.3
56
22.2.4
57
22.2.5
60
22.2.6
60
22.2.7
61
22.2.8
61
23
67
24
67
25
68
Figures (in Report)
Figure 1-1: Mon Valley Complex Property Location Map
2
Figure 1-2: CAPEX
5
Figure 1-3: OPEX
6
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
4
Figure 1-4: Sensitivity of NPV
10
Figure 6-1: Stratigraphic Column
18
Figure 7-1: Mon Valley Cross-Section
20
Figure 11-1: Histogram of the Total Seam Thickness for the Upper Freeport Seam
27
Figure 11-2: Scatter plot of the Total Seam Thickness for the Upper Freeport Seam
27
28
Figure 11-4: Result of DHSA for the Upper Freeport Seam Present in the Mon
29
Figure 13-1: Proposed Pangburn Plant and Mine Site Infrastructure
38
Figure 18-1: CAPEX
45
Figure 19-1: Cash Costs per Tonne
49
Figure 19-2: Sensitivity of NPV
54
Tables (in Report)
3
4
4
7
7
26
29
30
32
32
35
42
47
47
50
51
7
58
59
60
61
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
5
62
63
63
64
64
65
66
66
67
67
68
Appendices
A
Biographies
B
Maps
C
Glossary of Te rms
D
JORC Table 1
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
1
1
Executive Summary
1.1 Property Description
Coronado Global Resources Inc. (
Coronado
)
authorized
Marshall Miller & Associates,
Inc. (
MM&A
)
to prepare this Technical Report Summary (
TRS
) of its controlled coal
resources and reserves for the Mon Valley Complex in southwestern Pennsylvania (Mon
Valley or the
Property
). The report provides a statement of coal resources and coal reserves
for Coronado, as defined under the
Australasian Code for Reporting of Exploration
Results, Mineral Resources and Ore Reserves
(
JORC Code
) as well as under Subpart
1300 of Regulation S-K (Regulation S-K 1300) promulgated by the
United States
Securities and Exchange Commission (
SEC
)
.
accordance with the
Australasian Code for Public Reporting of Technical Assessments
and Valuations of Mineral Assets
(
VALMIN Code
).
The Mon Valley property is comprised of three separate reserve holdings, namely, the
Pangburn, Shaner and Fallowfield proposed underground mines in the Upper Freeport
seam. All three respective reserve areas are greenfield sites and are undeveloped. The
three mines have been projected to operate independently, with production initially
beginning at Pangburn. Shaner is projected to come online as replacement production for
Pangburn, and Fallowfield represents expanded Mon Valley production after Pangburn is in
full production. In addition to the individual mine/plant sites, a barge loading dock on the
Monongahela River adjacent to the Pangburn site is proposed and will be used to ship clean
coal for all three mines. Each mine site will include a coal preparation plant and all
necessary surface facilities.
Coal resources and coal reserves are herein reported in metric units of measurement and
are rounded to millions of metric tonnes (
Mt
).
The Mon Valley properties are located approximately 16 kilometers to 32 kilometers
southeast of Pittsburgh, Pennsylvania (see
Figure 1-1
). The property is composed of 41,615
total hectares, of which 1,339 are leased from private landholders under two leases, and
40,276 hectares are owned by Coronado. Subject to Coronado’s exercising its renewal
rights thereunder, both of the leases expire upon exhaustion of the relevant coal reserves,
which is expected to occur in 2099.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
![ex964p11i1.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p11i1.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
2
Figure 1-1: Mon Valley Complex Property Location Map
1.2 Ownership
Mineral rights for the Property were formerly controlled by
Consolidation Coal Company
(
CONSOL
)
. Coronado acquired the Mon Valley properties from CONSOL in March 2016.
1.3 Geology
There are currently no active operations in the Mon Valley complex. Strata of economic
interest for this TRS are of the Pennsylvanian-age Allegheny Formation, and the subject
Upper Freeport seam is the principal coal seam of interest for Coronado. The Upper
Freeport seam has been mined extensively in the region. The seam is situated below
drainage throughout the Property and will be accessed by constructed mine shafts and
slopes.
1.4 Exploration Status
The Property has been explored extensively, largely by drilling using continuous coring
method, rotary drilling, and by downhole geophysical methods. The majority of the data was
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
3
acquired or generated by previous owners of the Property. These sources comprise the
primary data used in the evaluation of the coal resources and coal reserves on the Property.
MM&A examined the data available for the evaluation and incorporated all pertinent
information into this TRS. Where data appeared to be anomalous or not representative, that
information was excluded from the digital databases and subsequent processing by MM&A.
Ongoing exploration has been carried out by Coronado since acquiring the Mon Valley
properties.
1.5 Operations and Development
Coronado currently has no active operations in the Mon Valley complex. The mines will
produce coal that is suitable for the high-volatile metallurgical coal markets.
The preliminary design for the Pangburn mine surface facilities was provided by Coronado.
The facilities include offices, warehouses, shops, a bathhouse for personnel, a preparation
plant to process run-of-mine (
ROM
) coal, a refuse area with a designed capacity of
approximately 35 million refuse tonnes, raw coal storage at the plant totaling approximately
100,000 tonnes, clean coal storage at the plant site of approximately 54,000 tonnes, and
three clean coal stockpiles adjacent to the dock loading facility on the Monongahela River.
The three river stockpiles have a designed capacity of approximately 266,000 tonnes.
Processes are expected to be typical of those used at operating coal-processing plants and
the coal industry in general. The river dock is anticipated to also support production from
the planned Fallowfield and Shaner operations. Room-and-pillar mining will be employed
at these properties.
1.6 Mineral Resource
Mineral resources, representing in-situ coal in which a portion of reserves are derived, are
presented below. A coal resource estimate, summarized in
Table 1-1
, was prepared as of
December 31, 2021, for property controlled by Coronado.
Table 1-1: Coal Resources Summary as of December 31, 2021
Coal Resource (Dry Tonnes, In Situ, Mt)
Resource Quality (Dry)
Area
Measured
Indicated
Inferred
Total
Ash%
Sulfur%
VM%
Inclusive of Reserve
291.0
213.5
9.3
513.8
31
1.4
26
Exclusive of Reserve
0.0
0.0
0.0
0.0
Total 12/31/2021
291.0
213.5
9.3
513.8
Note: Resource tonnes are inclusive of reserve tonnes since they include the in-situ tonnes from which recoverable coal reserves
are derived.
Note 2: Coal resources are reported on a dry basis. Surface moisture and inherent moisture are excluded.
Note 3: The Mon Valley properties do not have any resource tonnes exclusive of reserves as of December 31, 2021.
1.7 Mineral Reserve
Reserve tonnage estimates provided herein report coal reserves derived from the in-situ
resource tonnes presented in
Table 1-1
, and not in addition to coal resources. Proven and
probable coal reserves were derived from the defined coal resource considering relevant
mining, processing, infrastructure, economic (including estimates of capital, revenue, and
cost), marketing, legal, environmental, socio-economic and regulatory factors. The
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Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
4
Resource estimate has been used as the basis for this Reserve calculation, which utilizes a
reasonable Preliminary Feasibility Study, a Life-of Mine (
LOM
) Mine Plan and practical
recovery factors. Production modeling was completed with an effective start date of May 1,
2031.
Factors that would typically preclude conversion of a coal resource to coal reserve include
the following: inferred resource classification; absence of coal quality; poor mine recovery;
lack of access; geological encumbrances associated with overlying and underlying strata;
seam thinning; structural complication; and insufficient exploration have all been considered.
Reserve consideration excludes those portions of the resource area which exhibit the
aforementioned geological and operational encumbrances.
Table 1-2: Coal Summary (ROM Basis (Moist)) as of December 31, 2021 (Mt)
Demonstrated Coal Reserves (Mt, Moist ROM)
By Reliability Category
By Mining Type
By Control Type
Quality (Dry)
Area /
Mine
Proved
Probable
Total
Surface
UG
Owned
Leased
Ash
Sulfur
Vol
Mon Valley
113.9
83.2
197.1
0.0
197.1
195.7
1.4
37
1.2
23
Coal reserves are presented on a ROM basis in
Table 1-2
. Proven and probable coal
reserves were derived from the defined in-situ coal resource considering relevant
processing, economic (including technical estimates of capital, revenue, and cost),
marketing, legal, environmental, socioeconomic, and regulatory factors. The proven and
probable coal reserves on the Property are summarized below in
Table 1-3
.
Table 1-3: Coal Reserves Summary (Marketable Sales Basis) as of December 31, 2021 (Mt)
Demonstrated Coal Reserves (Wet Tons, Washed or Direct Shipped, Mt)
Quality (Dry Basis)
By Reliability Category
By Mining Type
By Control Type
Property
Proven
Probable
Total
Surface
UG
Owned
Leased
Ash%
Sulfur%
VM%
Mon Valley
77.8
56.6
134.4
0.0
134.4
133.4
1.0
8
1.2
35
combination of surface and inherent moisture is modeled at 6-percent. Actual product moisture is dependent upon multiple
geological factors, operational factors, and product contract specifications and can exceed 8-percent. As such, the modeled
moisture values provide a level of conservatism for reserve reporting. Life-of-mine sulfur for Pangburn is an estimated 1.21%;
however, overall Mon Valley Complex reserve average is 1.36% sulfur.
In summary, Coronado controls a total of 134.4 Mt (moist basis) of marketable coal reserves
at Mon Valley, as of December 31, 2021. Of that total, 58 percent are proven, and 42
percent are probable. There are 133.4 Mt of owned coal reserves and 1.0 Mt of leased coal
reserves. All of the Mon Valley reserves are considered suitable for the metallurgical coal
market. All of the Mon Valley reserves are unassigned.
1.8 Capital Summary
The MM&A financial model includes provisions for operating equipment at the proposed
Mon Valley operations. MM&A’s capital schedules assume that major equipment rebuilds
occur over the course of each machine’s remaining assumed operating life. Replacement
equipment was scheduled based on MM&A’s experience and knowledge of mining
equipment and industry standards with respect to the useful life of such equipment. A
summary of the estimated capital for the Property is provided in
Figure 1-2
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
![ex964p14i1.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p14i1.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
5
Figure 1-2: CAPEX
1.9 Operating Costs
MM&A used the Coronado historical and/or budget cost information for comparable
operations as a reference and developed personnel schedules for the mine and support
facilities. Hourly labor rates and salaries were based upon information contained in
Coronado’s financial summaries. Fringe benefit costs were developed for vacation and
holidays, federal and state unemployment insurance, retirement, workers’ compensation
and pneumoconiosis, casualty and life insurance, healthcare, and bonuses. A cost factor
for mine supplies was developed that relates expenditures to mine advance rates for roof
control costs and other mine supply costs at underground mines. Other factors were
developed for maintenance and repair costs, rentals, mine power, outside services and
other direct mining costs.
Operating-cost factors were also developed for the coal preparation plant processing, refuse
handling, coal loading, property taxes, and insurance and bonding. Appropriate royalty rates
were assigned for production from leased coal lands and sales taxes were calculated for the
federal black lung excise tax, and federal reclamation fees.
A summary of the projected operating costs for the Property is provided in
Figure 1-3
.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
![ex964p15i1.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p15i1.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
6
Figure 1-3: OPEX
1.10 Economic Evaluation
The pre-feasibility financial model prepared for this TRS was developed to test the economic
viability of each coal resource area. The results of this financial model are not intended to
represent a bankable feasibility study, required for financing of any current or future mining
operations contemplated for the Coronado properties, but are intended to establish the
economic viability of the estimated coal reserves. Cash flows are simulated on an annual
basis in nominal dollars assuming a 2% inflation rate based on projected production from
the coal reserves. The discounted cash flow analysis presented herein is based on an
effective date of January 1, 2022.
On an un-levered basis, the net present value (
NPV
) of the project cash flow after taxes
represents the Enterprise Value of the project. The project cash flow, excluding debt
service, is calculated by subtracting direct and indirect operating expenses and capital
expenditures from revenue. Direct costs include labor, operating supplies, maintenance and
repairs, facilities costs for materials handling, coal preparation, refuse disposal, coal loading,
reclamation and general and administrative costs. Indirect costs include statutory and
legally agreed upon fees related to direct extraction of the mineral. The indirect costs are
the Federal black lung tax, Federal reclamation taxes, property taxes, coal production
royalties, and income taxes.
Table 1-4
P&L
), and earnings before income tax,
depreciation & amortization (
EBITDA
) for each proposed Coronado mine at Mon Valley.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
7
Table 1-4: Life-of-Mine Tonnage, P&L before Tax, and EBITDA ($000)
LOM
LOM
P&L
LOM
EBITDA
Tonnes
*
Pre-Tax P&L
Per Tonne
EBITDA
Per Tonne
Pangburn
14,376
$701,483
$48.80
$1,259,113
$87.59
Fallowfield
72,640
$4,712,144
$64.87
$6,688,054
$92.07
Shaner
48,294
$4,656,184
$96.41
$5,641,238
$116.81
Consolidated PA Deep Mines
135,309
$10,069,811
$74.42
$13,588,405
$100.42
Note: *Financial model includes 0.9 million tonnes of inferred coal production. Inferred coal represents
0.6% of the total production, and none of this coal was included in the estimate of reserves.
As shown in
Table 1-4,
Overall, Coronado’s consolidated operations show positive LOM P&L and LOM EBITDA of
$10.1 billion and $13.6 billion, respectively.
Coronado’s consolidated Mon Valley cash flow summary in nominal dollars assuming a 2%
inflation rate, excluding debt service, is shown in
Table 1-5
Table 1-5: Project Cash Flow Summary (000)
*
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
Total
2026
2027
2028
2029
2030
Production & Sales tonnes
135,311
-
-
-
-
-
Total Revenue
$32,678,158
$-
$-
$-
$-
$-
EBITDA
$11,822,150
$(369)
$(369)
$(369)
$(369)
$(369)
Net Income
$5,925,986
$(369)
$(369)
$(369)
$(369)
$(369)
Net Cash Provided by Operating Activities
$9,042,337
$(369)
$(369)
$(369)
$(369)
$(312)
Purchases of Property, Plant, and Equipment
$(3,293,945)
$-
$(5,087)
$(29,721)
$(35,261)
$(215,753)
Net Cash Flow
$5,748,391
$(369)
$(5,456)
$(30,090)
$(35,629)
$(216,065)
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
2031
2032
2033
2034
2035
2036
Production & Sales tonnes
399
1,810
1,875
1,958
2,029
2,030
Total Revenue
$57,415
$266,199
$281,967
$301,091
$319,037
$326,330
EBITDA
$31,974
$163,768
$175,562
$191,169
$204,833
$209,981
Net Income
$(43,182)
$84,520
$86,628
$82,382
$94,260
$106,329
Net Cash Provided by Operating Activities
$25,910
$135,802
$160,145
$157,652
$168,511
$179,238
Purchases of Property, Plant, and Equipment
$(199,931)
$(1,928)
$-
$(21,158)
$(19,527)
$(204,537)
Net Cash Flow
$(174,021)
$133,874
$160,145
$136,494
$148,984
$(25,299)
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
8
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
2037
2038
2039
2040
2041
2042
Production & Sales tonnes
2,062
1,960
1,762
2,366
1,804
1,724
Total Revenue
$338,825
$329,205
$302,680
$415,404
$307,404
$305,722
EBITDA
$217,762
$206,113
$179,715
$261,905
$167,920
$166,433
Net Income
$94,184
$107,142
$79,588
$136,843
$92,275
$83,239
Net Cash Provided by Operating Activities
$190,294
$179,925
$156,327
$197,122
$130,469
$131,680
Purchases of Property, Plant, and Equipment
$(178,362)
$(11,413)
$(10,070)
$(18,939)
$(6,627)
$(11,701)
Net Cash Flow
$11,932
$168,512
$146,257
$178,183
$123,842
$119,979
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
2043
2044
2045
2046
2047
2048
Production & Sales tonnes
1,717
1,641
1,719
1,657
1,582
1,704
Total Revenue
$307,825
$296,435
$323,078
$319,329
$311,207
$346,423
EBITDA
$166,345
$155,468
$176,197
$172,276
$164,044
$190,984
Net Income
$97,162
$102,577
$115,995
$111,938
$105,580
$121,920
Net Cash Provided by Operating Activities
$134,459
$126,566
$132,835
$135,759
$130,416
$145,691
Purchases of Property, Plant, and Equipment
$(70,898)
$(32,130)
$(1,608)
$(3,445)
$(20,197)
$(42,226)
Net Cash Flow
$63,561
$94,436
$131,226
$132,313
$110,218
$103,465
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
2049
2050
2051
2052
2053
2054
Production & Sales tonnes
1,656
1,732
1,702
1,596
1,642
1,750
Total Revenue
$341,272
$366,419
$363,743
$344,653
$358,264
$385,655
EBITDA
$185,001
$203,854
$199,083
$181,885
$190,949
$208,272
Net Income
$117,207
$139,379
$136,063
$119,219
$124,332
$139,625
Net Cash Provided by Operating Activities
$148,383
$156,450
$155,343
$145,611
$148,945
$159,944
Purchases of Property, Plant, and Equipment
$(21,985)
$(2,264)
$(17,661)
$(35,030)
$(22,841)
$-
Net Cash Flow
$126,398
$154,185
$137,682
$110,580
$126,104
$159,944
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
2055
2056
2057
2058
2059
2060
Production & Sales tonnes
1,751
2,609
3,576
3,732
3,846
3,762
Total Revenue
$389,797
$586,754
$812,425
$856,469
$891,518
$881,012
EBITDA
$209,937
$293,768
$402,164
$424,215
$445,248
$430,456
Net Income
$159,520
$155,760
$230,828
$240,983
$258,267
$235,432
Net Cash Provided by Operating Activities
$177,985
$239,301
$313,658
$343,495
$359,216
$357,509
Purchases of Property, Plant, and Equipment
$(503,004)
$(81,075)
$(26,163)
$(36,932)
$(20,244)
$(124,371)
Net Cash Flow
$(325,019)
$158,226
$287,495
$306,563
$338,972
$233,138
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
2061
2062
2063
2064
2065
2066
Production & Sales tonnes
3,488
3,390
3,466
3,397
2,961
2,826
Total Revenue
$825,025
$810,082
$836,766
$828,451
$729,294
$703,094
EBITDA
$384,291
$373,425
$383,395
$380,242
$330,841
$317,117
Net Income
$197,731
$249,775
$251,050
$244,672
$199,779
$187,067
Net Cash Provided by Operating Activities
$332,663
$309,606
$303,605
$304,427
$278,545
$263,255
Purchases of Property, Plant, and Equipment
$(48,371)
$(18,997)
$(56,143)
$(55,800)
$(106,035)
$(48,026)
Net Cash Flow
$284,292
$290,609
$247,461
$248,627
$172,510
$215,229
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
2067
2068
2069
2070
2071
2072
Production & Sales tonnes
2,479
2,318
2,289
1,438
1,988
1,993
Total Revenue
$623,079
$588,566
$587,014
$372,607
$520,312
$526,958
EBITDA
$274,027
$245,996
$243,975
$120,878
$208,565
$209,313
Net Income
$157,110
$137,332
$132,150
$60,913
$125,427
$130,499
Net Cash Provided by Operating Activities
$236,473
$211,681
$204,662
$72,113
$144,108
$165,794
Purchases of Property, Plant, and Equipment
$(105,470)
$(32,972)
$(35,968)
$(21,665)
$(40,884)
$(29,483)
Net Cash Flow
$131,003
$178,708
$168,694
$50,448
$103,224
$136,311
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
9
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
2073
2074
2075
2076
2077
2078
Production & Sales tonnes
1,822
2,098
2,055
2,107
1,883
2,129
Total Revenue
$486,489
$513,364
$508,098
$526,120
$474,939
$542,425
EBITDA
$180,965
$192,961
$185,766
$199,986
$169,269
$204,346
Net Income
$110,565
$131,576
$121,087
$124,925
$102,184
$132,803
Net Cash Provided by Operating Activities
$151,740
$149,923
$150,163
$155,728
$139,913
$152,938
Purchases of Property, Plant, and Equipment
$-
$-
$(38,951)
$(73,146)
$(11,367)
$(3,092)
Net Cash Flow
$151,740
$149,923
$111,2 12
$82,582
$128,546
$149,846
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
2079
2080
2081
2082
2083
2084
Production & Sales tonnes
1,937
1,723
2,242
1,568
2,285
1,637
Total Revenue
$498,511
$448,125
$588,782
$416,070
$612,359
$443,292
EBITDA
$172,232
$139,209
$217,859
$113,527
$222,506
$118,656
Net Income
$108,806
$74,410
$128,734
$54,853
$144,403
$63,019
Net Cash Provided by Operating Activities
$140,295
$115,386
$153,758
$109,676
$151,887
$113,810
Purchases of Property, Plant, and Equipment
$(20,499)
$(63,240)
$(32,548)
$(7,363)
$(18,926)
$(35,128)
Net Cash Flow
$119,796
$52,146
$121,210
$102,313
$132,961
$78,682
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
2085
2086
2087
2088
2089
2090
Production & Sales tonnes
1,982
1,477
1,857
1,616
1,993
1,305
Total Revenue
$542,129
$408,032
$518,052
$455,417
$567,535
$375,427
EBITDA
$169,637
$89,713
$145,507
$108,922
$166,892
$55,785
Net Income
$96,625
$31,702
$79,264
$51,566
$96,127
$8,392
Net Cash Provided by Operating Activities
$123,443
$88,067
$104,777
$94,796
$120,752
$66,853
Purchases of Property, Plant, and Equipment
$(35,870)
$(53,613)
$(23,904)
$(32,182)
$-
$(31,114)
Net Cash Flow
$87,573
$34,453
$80,873
$62,614
$120,752
$35,738
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
2091
2092
2093
2094
2095
2096
Production & Sales tonnes
1,637
1,612
1,747
1,355
1,731
1,752
Total Revenue
$475,574
$473,016
$517,712
$405,723
$523,488
$535,336
EBITDA
$103,525
$97,847
$113,758
$40,298
$107,715
$110,329
Net Income
$41,301
$32,537
$52,174
$(4,344)
$49,211
$50,915
Net Cash Provided by Operating Activities
$75,371
$81,436
$89,571
$46,746
$76,088
$90,203
Purchases of Property, Plant, and Equipment
$(71,872)
$(66,089)
$-
$-
$(42,121)
$-
Net Cash Flow
$3,499
$15,347
$89,571
$46,746
$33,967
$90,203
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
2097
2098
2099
2100
2101
2102
Production & Sales tonnes
1,387
916
393
-
-
-
Total Revenue
$428,077
$285,625
$123,638
$-
$-
$-
EBITDA
$46,344
$27,079
$5,340
$-
$-
$-
Net Income
$2,394
$(3,736)
$(11,836)
$-
$-
$-
Net Cash Provided by Operating Activities
$50,190
$27,994
$(197,622)
$-
$-
$-
Purchases of Property, Plant, and Equipment
$-
$-
$-
$-
$-
$-
Net Cash Flow
$50,190
$27,994
$(197,622)
$-
$-
$-
● Financial model includes 0.9 million tonnes of inferred coal production. Inferred coal represents 0.6% of the
total production, and none of this coal was included in the estimate of reserves.
Consolidated cash flows are driven by annual sales tonnage, which grows from 0.4 million
tonnes in 2031 to a peak of 3.8 million tonnes in 2059. Between years 2060 and 2089, sales
ranges from 1.5 million to 2.7 million tonnes and between years 2090-2099, sales range
from 0.4 million tonnes to 1.3 million tonnes. Projected consolidated revenue grows from
$57.4 million in 2031 to a peak of $891.5 million in 2059. Revenue totals $32.7 billion for
the project’s life.
Consolidated cash flow from operations is positive throughout the projected operating
period, with the exception of post-production years, due to end-of-mine reclamation
spending. Consolidated cash flow from operations peaks at $359.2 million in 2059 and
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
![ex964p19i1.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p19i1.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
10
totals $9.0 billion over the project’s life. Capital expenditures total $485.8 million during the
first five years and $3.3 billion over the project’s life.
1.10.1 Discounted Cash Flow Analysis
Cash flow after tax, but before debt service, generated over the life of the project was
discounted to NPV at a 10.0% discount rate, which represents Coronado’s estimate of the
nominal dollar, adjusted weighted average cost of capital (
��
riskWACC
) for likely market
participants if the subject reserves were offered for sale. On an un-levered basis, the NPV
of the project cash flows represents the Enterprise Value of the project and amounts to
$287.3 million. The pre-feasibility financial model prepared for the TRS was developed to
test the economic viability of each coal resource area. The NPV estimate was made for
purposes of confirming the economics for classification of coal reserves and not for purposes
of valuing Coronado or its Mon Valley assets. Mine plans were not optimized, and actual
results of the operations may be different, but in all cases, the mine production plan assumes
the properties are under competent management.
1.10.2 Sensitivity Analysis
Sensitivity of the NPV results to changes in the key drivers is presented in the chart below.
The sensitivity study shows the NPV at the 10.0% discount rate when Base Case sales
prices, operating costs, and capital costs are increased and decreased in increments of 5%
within a +/- 15% range.
Figure 1-4: Sensitivity of NPV
As shown, NPV is quite sensitive to change in sales price and operating cost estimates, and
slightly sensitive to changes in capital cost estimates.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
11
1.11 Permitting
Due to the projected start-up date of the Mon Valley mines, initial-stage permit work has
been completed to date; however, no permit applications have been submitted to the state
or federal regulatory agencies. The proposed mines are located in an area with a long
history of coal mining, with numerous permitted operations in close proximity. Coal mining
permits are routinely obtained; a 2 to 3-year lead time is recommended. Estimated
expenditures for mine closure and site reclamation are included in the financial model for
each mine or plant site. MM&A is unaware of any obvious or current Coronado permitting
issues that are expected to prevent the issuance of future permits. All coal producers are
subject to a level of uncertainty regarding future clean water permits due to
United States
Environmental Protection Agency
(
EPA
)
1.12 Conclusion and Recommendations
Sufficient data has been obtained through various exploration, sampling programs, and
mining operations to support the geological interpretations of seam structure and thickness
for coal horizons situated on the Property. The data are of sufficient quantity and reliability
to reasonably support the coal-resource and coal-reserve estimates in this TRS.
The geological data and preliminary feasibility study, which consider mining plans, revenue,
and operating- and capital-cost estimates are sufficient to support the classification of coal
reserves provided herein.
This geologic evaluation conducted in conjunction with the preliminary feasibility study
concludes that the 134.4 Mt of marketable underground coal reserves identified on the
Property are economically mineable under reasonable expectations of market prices for
metallurgical coal products, estimated operation costs, and capital expenditures.
2
Introduction
2.1 Registrant and Terms of Reference
This report was prepared for the sole use of
Coronado Global Resources Inc. (
Coronado
)
and its affiliated and subsidiary companies and advisors. The report provides a statement
of coal resources and coal reserves for Coronado, as defined under the
Australasian Code
for Reporting of Exploration Results, Mineral Resources and Ore Reserves
(
JORC
Code
) as well as under Subpart 1300 of Regulation S-K (Regulation S-K 1300) promulgated
by the
United States Securities and Exchange Commission (
SEC
)
.
prepared in accordance with the
Australasian Code for Public Reporting of Technical
Assessments and Valuations of Mineral Assets
(
VALMIN Code
).
The Mon Valley property is comprised of three separate reserve holdings, namely, the
Pangburn, Shaner and Fallowfield proposed underground mines in the Upper Freeport
seam.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
12
The report provides a statement of coal resources and coal reserves for Coronado at the
Property. Exploration results and Resource calculations were used as the basis for the mine
planning and the preliminary feasibility study completed to determine the extent and viability
of the reserve.
Coal resources and coal reserves are herein reported in metric units of measurement and
are rounded to millions of metric tonnes (
Mt
).
2.2 Information Sources
This TRS is based on information provided by Coronado and reviewed by Scott Peterson,
CPG; and Justin S. Douthat, PE, MBA.
Coronado engaged MM&A to conduct a coal resource and reserve evaluation of the
Coronado coal properties as of December 31, 2021, the effective date of this TRS for Mon
Valley. For the evaluation, the following tasks were to be completed:
> Conduct a site visit to the projected resource/reserve area;
> Process the information supporting the estimation of coal resources and reserves into
geological models;
> Develop life-of-reserve mine (
LOM
) plans and financial models;
> Hold discussions with Coronado company management; and
> Prepare and issue a TRS providing a statement of coal resources and reserves which
would include:
-
-
-
under the JORC Code and the SEC Regulation S-K 1300.
2.3 Personal Inspections
MM&A is very familiar with the Mon Valley properties, having provided a variety of geological
and engineering evaluations of the subject property and neighboring properties in recent
years. No facilities are constructed on the properties.
3
Property Description
3.1 Location
The Mon Valley Complex will include the Pangburn, Shaner, and Fallowfield underground
mines in the Upper Freeport coal seam. The properties are located approximately 22.5
kilometers southeast of Pittsburgh.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
13
The property is located in Allegheny, Washington, and Westmoreland Counties,
Pennsylvania. Mining operations here have not yet been initiated. The Property is located
on portions of eight
United States Geological Survey
(
USGS
) quadrangles: Irwin;
Glassport; Monongahela; Donora; Smithton; California; Ellsworth; and Hackett. The
coordinate system and datum used for the model of Mon Valley and the subsequent maps
were produced in the Pennsylvania State Plane South system, NAD 27.
3.2 Titles, Claims or Leases
The property is composed of 41,615 total hectares, of which 1,339 are leased from private
landholders under two leases, and 40,276 hectares are owned by Coronado. Subject to
Coronado’s exercising its renewal rights thereunder, both of the leases expire upon
exhaustion of the relevant coal reserves, which is expected to occur in 2099. MM&A has
not carried out a separate title verification for the coal properties and has not verified leases,
deeds, surveys, or other property-control instruments pertinent to the subject resources.
Tenure was separately reviewed by Coronado’s legal advisors. Coronado has represented
to MM&A that it controls the mining rights to the reserves as shown on its property maps,
and MM&A has accepted these as being a true and accurate depiction of the mineral rights
controlled by Coronado. The TRS assumes the properties are developed under responsible
and experienced management.
3.3 Mineral Rights
Coronado supplied property control maps to MM&A related to properties for which mineral
and/or surface property are controlled by Coronado. While MM&A accepted these
representations as being true and accurate, MM&A has no knowledge of past property
boundary disputes or other concerns, through past knowledge of the Property, that would
signal concern over future mining operations or development potential.
Property control in Appalachia can be intricate. Coal-mining properties are typically
composed of numerous property tracts which are owned and/or leased from both land-
holding companies and private individuals or companies. It is common to encounter severed
ownership, with different entities or individuals controlling the surface and mineral rights.
Mineral control in the region is typically characterized by leases or ownership of larger tracts
of land, with surface control generally comprised of smaller tracts, particularly in developed
areas.
Legal mining rights may reflect a combination of fee or mineral ownership and fee or mineral
leases of coal lands through various surface and mineral lease agreements.
Control of the surface property is necessary to conduct surface mining but is not necessary
to conduct underground mining. Given that the vicinity of the Mon Valley properties has an
extensive history of coal mining, Coronado and its predecessors have a successful history
of obtaining any necessary rights and the associated permits to mine.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
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3.4 Encumbrances
No Title Encumbrances are known. By assignment, MM&A did not complete a query related
to Title Encumbrances.
3.5 Other Risks
There is always risk involved in property control. Coronado and its predecessor, CONSOL,
have both had their legal teams examine the deeds and title control in order to minimize the
risk.
4
Accessibility, Climate, Local Resources,
Infrastructure and Physiography
4.1 Topography, Elevation and Vegetation
Topography of the area surrounding the proposed Mon Valley complex is typical of the
Northern Appalachian Plateau consisting of broad river valleys and rolling hills, with some
upland regions. Surface elevations near the Property range from approximately 396 meters
above sea level in upland regions to approximately 220 meters at stream level. The property
is moderately vegetated by primarily oak hardwood forests, but the majority of the land is
developed for farm and residential use. The property is situated near the major urban center
of Pittsburgh, PA and is considered suburban.
4.2 Access and Transport
There is general access to the Mon Valley property via a well-developed network of primary,
secondary, and unimproved roads. The Monongahela and Youghiogheny Rivers traverse
the Property from south to north. There are numerous four-lane limited-access roads
situated within or adjacent to the Property as well as a network of improved two-lane state
and county roads. U.S. Interstate 70 and Pennsylvania Route 51 traverse the Fallowfield
and Pangburn properties, respectively. Numerous secondary and unimproved roads
provide direct access to the mine property, some being state- and town- maintained. These
roads typically stay open throughout the year. There are numerous transportation/logistical
options for shipping product. The primary means of transport for produced coal would be
by barge on the Monongahela River/Ohio River system. Additionally, a CSX rail line located
along the banks of the Monongahela River would provide another option for the shipment of
coal.
4.3 Proximity to Population Centers
The Mon Valley property lies near the communities of Bentleyville, Lockview, Monongahela,
Elizabeth, Sutersville, and Irwin, Pennsylvania approximately 16 kilometers to 32 kilometers
southeast of Pittsburgh, and 16 kilometers to 32 kilometers from Washington and
McKeesport, Pennsylvania. As of the 2020 census Pittsburgh had a population of 302,971
residents; McKeesport, 18,825; and Washington, 13,176.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
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4.4 Climate and Length of Operating Season
The climate of the region is classified as warm-summer humid continental with four distinct
seasons: warm summers, cold winters, and moderate fall and spring seasons. Precipitation
in the region is consistent throughout the year with the most rain falling in spring and the
early months of summer. Average yearly rainfall is 53.1 centimeters. Summer months
typically begin in late May and end in early September and range in average temperature
from 51 to 84 degrees Fahrenheit (or 10.6 to 28.9 degrees Celsius). Winters typically begin
in mid to late November and run until mid to late March with average temperatures ranging
from 22 to 50 degrees Fahrenheit (or -5.6 to 10 degrees Celsius). Precipitation in the winter
typically comes in the form of snowfall or as a wintery mix (sleet and snow) with severe
snowfall events occurring occasionally. Seasonal variations in climate typically do not affect
underground mining in Pennsylvania. However, weather events could potentially negatively
impact efficiency of surface and preparation plant operations on a very limited basis, typically
lasting less than a few days.
4.5 Infrastructure
The Mon Valley property has sources of water, power, personnel, and supplies readily
available for use. Personnel have historically been sourced from the surrounding
communities in Allegheny, Washington, and Westmoreland Counties, and have proven to
be adequate in numbers to operate the mines. As mining is common in the surrounding
areas, the workforce is generally familiar with mining practices, and many are experienced
miners. Water is expected to be sourced locally from nearby public water sources or rivers.
Electricity is anticipated to be sourced from
West Penn Power
(
West Penn
)
Duquesne
Light
(
Duquesne Light
)
. The service industry in the areas surrounding the proposed mine
complex has historically provided supplies, equipment repairs and fabrication, etc. Barge
transport on the Monongahela River/Ohio River system will serve as the main means of
product transport from the mine, and currently serve as a means of coal transportation for
neighboring Pittsburgh seam operations. Rail access is provided by a
(
CSX
)
5
History
5.1 Previous Operation
The property was formerly controlled by
Consolidation Coal Company
(
CONSOL
).
Historic underground operations were active in the area in the early 1900’s and contour
surface mining was performed in the 1950 to 1960 era.
Coronado acquired the properties
from CONSOL in March 2016.
5.2 Previous Exploration
The properties have been extensively explored by subsurface drilling efforts carried out by
numerous entities, most of which were completed prior to acquisition by Coronado. The
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
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SSOCIATES
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16
majority of the drilling was accomplished using vertical continuous (diamond) coring and air
rotary methods.
Drill records indicate that independent contract drilling operators have been engaged
periodically to carry out exploration drilling on the properties. Geophysical logging on those
properties acquired from CONSOL was often performed by both CONSOL’s in-house
logging services and outside logging firms.
6
Geological Setting, Mineralization and Deposit
6.1 Regional, Local and Property Geology
The property lies in the Northern Appalachian Coal basin in the Appalachian Plateau
physiographic province. The coal deposits in the eastern USA are the oldest and most
extensively developed coal deposits in the country. The coal deposits on the properties are
Carboniferous in age, being of the Pennsylvanian system. Overall, these Carboniferous
coals contain roughly two-fifths of the bituminous coal deposits in the United States and
extend over 1,448 kilometers from northern Alabama to Pennsylvania and are part of what
is known as the
Appalachian Basin
. The Appalachian Basin is more than 402 kilometers
wide and, in some portions, contains over 60 coal seams of varying economic significance.
Seams of economic significance typically range between 0.3 meters to 1.8 meters in
thickness, with relatively little structural deformation. Regional structure is typically
characterized by gently dipping strata to the northwest at less than one percent.
Seams of the Allegheny Formation have historically been mined in the Pennsylvania region
with the Upper Freeport seam being one of the principal seams in the formation. Coal from
the area has historically sold in thermal and metallurgical markets.
Future operations at the Mon Valley properties will extract the Upper Freeport coal seam,
which covers large areas of Pennsylvania, Ohio, Maryland, and West Virginia. The Upper
Freeport seam is situated at the top of the Allegheny Group of the middle Pennsylvanian
period (307-315 million years ago). The top of the Upper Freeport seam is commonly used
as the marker between the top of the Allegheny Formation and the overlying Upper
Pennsylvanian Conemaugh Group. The Allegheny Formation is made up of laminated
cyclothemic sequences of coal, shale, limestone, and clay. The Upper Freeport seam lies
generally around 183 meters below the Pittsburgh seam. Deposits associated with the
Upper Freeport are often irregular and dislocated deposits (formed in domed peat swamps
commonly referred to as “peat islands”).
The primary structural controls on the Upper Freeport coal basin are localized syn-
depositional anticlines and synclines that directly influence the accumulation of peat bogs.
These structures create gently folded and rolling coal strata. The axis of the Waynesburg
and Port Royal (Irwin) synclines pass through the center and eastern portions of the
properties with a trend and incline to the Northeast. The Amity, Murrysville, and Belle
Vernon anticlines (listed from west to east) reside to the center and western portions of the
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
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properties. These anticlines often coincide with thicker coal seams where peat accumulated
in domes along the anticlinal crest. It is understood that local anticlines represent the
upthrown side of syn-depositionally active deep faults. Inversely, fluvial channel sediments
were deposited on the structural downthrown side within synclines.
Within the Pangburn, Shaner, and Fallowfield mine-plan areas, the Upper Freeport is
typically 183 meters to 335 meters below the ground surface. Mine access is therefore to
be provided by shaft and slope development. The planned Pangburn shaft depth is
approximately 195 meters in depth. The shaft depths at the projected locations for the
Shaner and Fallowfield shafts range from approximately 232 meters to 268 meters.
6.2 Mineralization
The coal to be produced at The Mon Valley Complex is typically high volatile (>31% volatile
matter) bituminous coal.
The generalized stratigraphic columnar section in
Figure 6-1
relationship of the principal coal seams and rock formations on the Property.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
![ex964p27i1.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p27i1.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
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Figure 6-1: Stratigraphic Column
(not to scale)
6.3 Deposits
Historic underground mining has occurred in the overlying Pittsburgh Seam on this property.
Contour surface mining on the Pittsburgh and Redstone outcrop has occurred within the
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
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&
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SSOCIATES
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areas projected for the coal refuse disposal area, the slope portal area and the preparation
plant area. The three proposed mines (Pangburn, Shaner, and Fallowfield) are all projected
to be deep mines in the Upper Freeport seam. Mining is projected in areas where the total
seam thickness exceeds 1.2 meters. Areas of sandstone washout and seam thinning have
been excluded from projections by MM&A personnel. Additional exploration could identify
additional geologically limiting features, which could alter the proposed mine plan. The
Upper Freeport seam in the projected areas ranges from 0.7 meters to 3.1 meters thick and
averages 1.95 meters thick.
7
Exploration
7.1 Nature and Extent of Exploration
Extensive exploration in the form of subsurface drill efforts has been carried out on the
Property by numerous entities, most of which efforts were completed prior to the acquisition
by Coronado. Diamond core and rotary drilling are the primary types of exploration on the
Property. Data for correlation and mining conditions are derived from core descriptions and
geophysical logging (e-logging). Coal quality analyses were also employed during the core
exploration process. A total of approximately 750 core and rotary holes have been drilled
for exploration.
The location of the drilling is shown on the maps included in
Appendix B
.
The concentration of exploration varies slightly across the Property. Drilling on the Property
is typically sufficient for delineation of potential underground mineable benches. Core
logging is carried out by professional geologists in cases where roof and floor strata are of
particular interest and in cases where greater resolution and geologic detail are needed.
Generally speaking, however, most drill hole data come from simplified driller’s logs, which
often lack specific details regarding geotechnical conditions and specific geology, making
correlations and floor and roof conditions difficult to determine. Geophysical logging (e-
logging) techniques, by contrast, document specific details useful for geologic interpretation
and mining conditions. Given the variability of data-gathering methods,
definitive
of future mining conditions may not be possible, but projections and assumptions can be
made within a
reasonable
A significant effort was put into verifying the integrity of the database. Once this was
established, stratigraphic columnar sections were generated using cross-sectional analysis
to establish or confirm coal seam correlations. A typical cross-section is shown in
Figure 7-
1
.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
![ex964p29i1.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p29i1.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
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Figure 7-1: Mon Valley Cross-Section
Due to the long history of exploration by various parties on the Property, a wide variety of
survey techniques exist for documentation of data point locations. Many of the older
exploration drill holes appear to have been located by survey and more recently-completed
drill holes are often located by high-resolution Global Positioning System (
GPS
) units.
However, some holes appear to have been approximately located using USGS topography
maps or other methods which are less accurate. Therefore, discretion had to be used
regarding the accuracy for the location and ground surface elevation of some of these older
drill holes. In instances where a drill hole location (or associated coal seam elevations)
appeared to be inconsistent with the overall structural trend (or surface topography for
surface-mineable areas), the data point was not honored for geological modeling. Others
with apparently minor variances were adjusted and then used by MM&A.
Surveying of the underground and surface mined areas has been performed by the mine
operators and/or their consulting surveyors. By assignment, MM&A did not verify the
accuracy or completeness of supplied mine maps but accepted this information as being the
work of responsible engineers and surveyors.
MM&A compiled comprehensive topographic map files by selecting the best available aerial
mapping for each area and filling any gaps with digital USGS topographic mapping.
7.2 Non-Drilling Procedures and Parameters
All pertinent data used to characterize the coal resources and coal reserves have been
acquired via exploration-based drilling methods. The region has historically produced and
sold Upper Freeport-based coal into metallurgical and thermal markets, enhancing the
confidence of the marketability and quality of the resource.
7.3 Drilling Procedures
Core drilling methods utilize NX-size (~5.4 centimeter) or similar-sized core cylinders to
recover core samples, which can be used to delineate geologic characteristics, for coal-
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
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21
quality testing, and for geotechnical logging. With core holes, geophysical logs are
especially useful in verifying the core recovery of both the coal samples (for assurance that
the sample is representative of the full seam) and of the roof and floor rock samples (for
evaluating ground control characteristics of deep mineable coal seams). In addition to the
core holes, rotary-drilled holes also exist on most of the Property. Data for the rotary-drilled
holes are mainly derived from downhole geophysical logs, which are used to interpret coal
and rock thickness and depth, since logging of the drill cuttings is unreliable. Exploratory
drilling generally requires drilling to depths of over 152 meters to penetrate the target coal
seam at Mon Valley.
A wide variety of core-logging techniques exist for the properties. For many of the core
holes, the primary data source is a generalized lithology description by the driller, typically
supplemented by a more detailed core log completed by a geologist. These drilling logs
were provided to MM&A as a geological database. MM&A geologists were not involved in
the production of original core logs but did perform a basic check of information within the
provided database. Where geophysical logs for such holes were available, they were used
by MM&A geologists to verify the coal thickness and core recovery of seams.
7.4 Hydrology
Based on historical successful production of Upper Freeport, and stratigraphically proximal
seams in the region, the Mon Valley Complex is not expected to have hydrologic concerns
of material issue. Future mining is projected to occur in areas exhibiting similar
hydrogeological conditions as past mining, including stream undermining and undermining
of aquifers. Based upon the successful history of mining in the region with regards to
hydrogeological features, MM&A assumes that the operations will not be hindered by such
issues.
The Pittsburgh seam has been mined extensively above the Upper Freeport seam on the
Property. The interval (approximately 183 meters) between the seams is anticipated to be
adequate to minimize inflow of water to the planned operations from the overlying Pittsburgh
works.
7.5 Geotechnical Data
Mining plans for potential underground mines were developed by Coronado and modified
by MM&A to fit current property constraints. Pillar stability was tested by MM&A using the
Analysis of Coal Pillar Stability (ACPS)
National
Institute for Occupational Safety and Health (
NIOSH
)
. MM&A reviewed the results from
the ACPS analysis and considered them in the development of the LOM plan.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
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&
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SSOCIATES
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8
Sample Preparation, Analyses and Security
8.1 Prior to Sending to the Lab
Most of the coal samples have been obtained from the Property by subsurface exploration
using core drilling techniques. The protocol for preparing and testing the samples has varied
over time and is not well documented for the older holes drilled on the Property. Typical
core-drilling sampling methods for coal in the United States involves drilling through the
seam, removing the core from the barrel, describing the lithology, wrapping the sample in a
sealed plastic sleeve and placing it lengthwise into a covered core box, and carefully
marking hole ID and depth intervals on each box and lid, allowing the core to be delivered
to a laboratory in correct stratigraphic order, and with original moisture content. This process
has been the norm for both historical and ongoing exploration activities at the Property.
This work is typically performed by the supervising driller, geologist, or company personnel.
Samples are most often delivered to the company by the driller after each shift or acquired
by company personnel or representatives. Most of the coal core samples were obtained by
previous or current operators on the Property. MM&A did not participate in the collection,
sampling and analysis of the core samples. However, it is reasonable to assume, given the
consistency of quality from previous operators, that these samples were generally collected
and processed under industry best practices. This assumption is based on MM&A’s
familiarity with the operating companies and the companies used to perform the analyses.
8.2 Lab Procedures
Coal quality testing has been performed over many years by operating companies using
different laboratories and testing regimens. Some of the samples have raw analyses and
washabilities on the full seam (with coal and rock parting layers co-mingled) and are mainly
useful for characterizing the coal quality for projected production from underground mining.
Other samples have coal and rock analyzed separately, the results of which can be
manipulated to forecast either surface or underground mining quality. Care has been taken
to use only those analyses that are representative of the coal quality parameters for the
appropriate mining type for each sample. Unlike many Appalachian properties, Mon Valley
only has interest in one deep seam; therefore, the analyses have likely been completed
following a consistent protocol.
Standard procedure upon receipt of core samples by the testing laboratory is to log the depth
and thickness of the sample, then perform testing as specified by a representative of the
operating company. Each sample is then analyzed in accordance with procedures defined
under
American Society for Testing and Materials (
ASTM
)
limited to; washability (ASTM D4371); ash (ASTM D3174); sulfur (ASTM D4239); Btu/lb.
(ASTM D5865); volatile matter (ASTM D3175); Free Swell Index (
FSI
) (ASTM D720).
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
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9
Data Verification
9.1 Procedures of Qualified Person
MM&A reviewed the digital geologic database supplied by Coronado. The database
consists of data records, which include drill hole information for holes that lie within and
adjacent to the Property and records for numerous supplemental coal seam thickness
measurements. Upon completion of the database verification, copies of each entry were
printed, and cross referenced to the original document for verification. Once the initial
integrity of the database was established, stratigraphic columnar sections were generated
using cross-sectional analysis to establish or confirm coal-seam correlations. Geophysical
logs were used wherever available to assist in confirming the seam correlation and to verify
proper seam thickness measurements and recovery of coal samples.
After establishing and/or verifying proper seam correlation, seam data control maps and
geological cross-sections were generated and again used to verify seam correlations and
data integrity. Once the database was fully vetted, seam thickness, base-of-seam elevation,
roof and floor lithology, and overburden maps were independently generated for use in the
mine planning process.
9.2 Limitations
As with any exploration program, localized anomalies cannot always be discovered. The
greater the density of the samples taken, the less the risk. Once an area is identified as
being of interest for inclusion in the mine plan, additional samples are taken to help reduce
the risk in those specific areas. In general, provision is made in the mine planning portion
of the study to allow for localized anomalies that are typically classed more as a nuisance
than a hinderance.
9.3 Opinion of Qualified Person
Sufficient data has been obtained through various exploration and sampling programs and
mining operations to support the geological interpretations of seam structure and thickness
for coal horizons situated on the Property. The data is of sufficient quantity and reliability to
reasonably support the coal resource and coal reserve estimates in this TRS.
10
Mineral Processing and Metallurgical Testing
10.1 Testing Procedures
Separate tabulations have been compiled for basic chemical analyses (both raw and
washed quality), petrographic data, rheological data and chlorine, ash, ultimate and sulfur
analysis.
Available coal quality data was tabulated by resource area in a Microsoft® EXCEL workbook
and the details of that work are maintained on file at the offices of Coronado and MM&A.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
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These tables also provide basic statistical analyses of the coal quality data sets, including
average value; maximum and minimum values; and the number of samples available to
represent each quality parameter of the seam. Coal samples that were deemed by MM&A
geologists to be unrepresentative were not used for statistical analysis of coal quality, as
documented in the tabulations. A representative group of drill hole samples from the
Property were then checked against the original drill laboratory reports to verify accuracy
and correctness.
The amount and areal extent of coal sampling for geological data is generally sufficient to
represent the quality characteristics of the coal horizons and allow for proper market
placement of the subject coal seams. For some of the coal deposits there are considerable
laboratory data from core samples that are representative of full extent of the resource area;
and for others there are more limited data to represent the resource area. For example, in
the active operations with considerable previous mining, there may be limited quality data
within some of the remaining resource areas; however, in those cases the core sampling
data can be supplemented with operational data from mining and shipped quality samples
representative of the resource area.
10.2 Relationship of Tests to the Whole
The extensive sampling and testing procedures typically followed in the coal industry result
in an excellent correlation between samples and marketable product. The Upper Freeport
seam has a long history of saleable production in the high-volatile metallurgical and thermal
markets, consistent with exploration results. Degradation of coking coal characteristics over
time is not anticipated to be an issue.
10.3 Lab Information
Each sample is analyzed at area Laboratories that operate in accordance with procedures
defined under ASTM standards including, but not limited to; washability (ASTM D4371); ash
(ASTM D3174); sulfur (ASTM D4239); Btu/lb. (ASTM D5865); volatile matter (ASTM
D3175); Free Swell Index (
FSI
) (ASTM D720).
10.4 Relevant Results
No critical factors have been found that would adversely affect the recovery of the Reserve.
Any quality issues that occur, either localized or generally are accounted for in the Marketing
Study done for this TRS.
11
Mineral Resource Estimates
MM&A independently created a geologic model to define the coal resources at the Property.
Coal resources were estimated as of December 31, 2021.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
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11.1 Assumptions, Parameters and Methodology
Geological data was imported into Carlson Mining
®
®
) geological
modelling software in the form of Microsoft
®
and thickness picks, bottom seam elevations and raw and washed coal quality. These data
files were validated prior to importing into the software. Once imported, a geologic model
was created, reviewed, and verified with a key element being a gridded model of coal seam
thickness. Resource tonnes were estimated by using the seam thickness grid based on
each valid point of observation and by defining resource confidence arcs around the points
of observation. Points of observation for Measured and Indicated confidence arcs were
defined for all valid drill holes that intersected the seam using standards deemed acceptable
by MM&A based on a detailed geologic evaluation and a statistical analysis of all drill holes
within the projected reserve areas as described in
Section 11.1.1
. The geological evaluation
incorporated an analysis of seam thickness related to depositional environments, adjacent
roof and floor lithologies, and structural influences.
After validating coal seam data and establishing correlations, the thickness and elevation
for seams of economic interest were used to generate a geologic model. Due to the relative
structural simplicity of the deposits and the reasonable continuity of the tabular coal beds,
the principal geological interpretation necessary to define the geometry of the coal deposits
is the proper modeling of their thickness and elevation. Both coal thickness and quality data
are deemed by MM&A to be reasonably sufficient within the resource areas. Therefore,
there is a reasonable level of confidence in the geologic interpretations required for coal
resource determination based on the available data and the techniques applied to the data.
Table 11 -1
for the coal resource and reserve evaluation. These cut-off parameters have been
developed by MM&A based on its experience with the Coronado properties and are typical
of mining operations in the Northern Appalachian Coal Basin. This experience includes
technical and economic evaluations of numerous properties in the region for the purposes
of determining the economic viability of the subject coal reserves.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
26
Table 11 -1: General Reserve and Resource Criteria
Item
Parameters
Technical Notes & Exceptions*
• General Reserve Criteria
Reserve Classification
Reserve and Resource
Reliability Categories
Reserve (Proven and Probable)
To better reflect geological conditions of the coal
deposits, distance between points of observation are
standard USGS (in meters), respectively, for
measured and indicated and inferred.
Effective Date of Resource
Estimate
December 31, 2021
Effective Date of Reserve
Estimate
December 31, 2021
Seam Density
Variable, dependent upon seam characteristics
(based on available drill hole quality). In the
absence of laboratory data, estimated by (1)
assuming specific gravity of 1.30 for coal and
2.25 to 2.5 for rock parting, or (2) 1280 kg/m
3
to
1324 kg/m
3
• Underground-Mineable Criteria
Map Thickness
Total seam thickness
Minimum Seam Thickness
1.2 meters (locally <1.2 m for limited areas
integral to the mine plan)
Pangburn was mapped at 0.92-meter cutoff in
conjunction with Coronado mine plan.
Minimum Mining Thickness
1.4 meters
Minimum In-Seam Wash
Recovery
40 percent
Wash Recovery Applied to
Coal Reserves
Based on average yield for drill holes within
reserve area, or in the absence of laboratory
washability data, based on estimated visual
recovery using specific gravities noted above and
95 percent yield on "clean" coal
Out-of-Seam Dilution
Thickness for Run-of-Mine
Tonnes Applied to Coal
Reserves
0.05 meters minimum
2243 kg/m³ density used for dilution tonnage
estimate
Mine Barrier
61-meter distance from abandoned mines and
sealed or pillared areas.
Adjustments Applied to Coal
Reserves
6 percent moisture increase; 5 percent
preparation plant inefficiency
Note: Exceptions for application of these criteria to resource and reserve estimation are made as warranted and demonstrated by either actual
mining experience or detailed data that allows for empirical evaluation of mining conditions. Final classification of coal reserve is made
based on the pre-feasibility evaluation.
11.1.1 Geostatistical Analysis
MM&A completed a geostatistical analysis on drill holes within the reserve boundaries to
determine the applicability of the common United States classification system for measured
and indicated and inferred coal resources. Historically, the United States has assumed that
coal within 0.4-kilometers of a point of observation represents a measured resource
whereas coal between 0.4 kilometers and 1.2 kilometers from a point of observation is
classified as indicated. Inferred resources are commonly assumed to be located between
1.2 kilometers and 4.8 kilometers from a point of observation. Per SEC regulations, only
measured and indicated resources may be considered for reserve classification,
respectively as proven and probable reserves.
MM&A performed a geostatistical analysis test of the Mon Valley data set using the Drill
Hole Spacing Analysis (
DHSA
) method. This method attempts to quantify the uncertainty
of applying a measurement from a central location to increasingly larger square blocks and
provides recommendations for determining the distances between drill holes for measured,
indicated, and inferred resources.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
![ex964p36i2.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p36i2.jpg)
![ex964p36i1.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p36i1.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
27
To perform DHSA the data set was processed to remove any erroneous data points,
clustered data points, as well as directional trends. This was achieved through the use of
histograms, as seen in
Figure 11-1
, color coded scatter plots showing the geospatial
positioning of the borings,
Figure 11-2
, and trend analysis.
Figure 11-1: Histogram of the Total Seam
Thickness for the Upper Freeport Seam
Present in the Mon Valley Complex
Figure 11-2: Scatter plot of the Total Seam
Thickness for the Upper Freeport Seam
Present in the Mon Valley Complex
Following the completion of data processing, a variogram of the data set was created,
Figure
11
-3
. The variogram plots average square difference against the separation distance
between the data pairs. The separation distance is broken up into separate bins defined by
a uniform lag distance (e.g., for a lag distance of 152 meters the bins would be 0 – 152
meters, 153 – 305 meters, etc.). Each pair of data points that are less than one lag distance
apart are reported in the first bin. If the data pair is further apart than one lag distance but
less than two lag distances apart, then the variance is reported in the second bin. The
numerical average for differences reported for each bin is then plotted on the variogram.
Care was taken to define the lag distance in such a way as to not overestimate any nugget
effect present in the data set. Lastly, modeled equations, often spherical, gaussian, or
exponential, are applied to the variogram in order to represent the data set across a
continuous spectrum.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
![ex964p37i1.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p37i1.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
28
Figure 11-3: Variogram of the Total Seam Thickness for the Upper Freeport Seam
Present in the Mon Valley Complex
The estimation variance is then calculated using information from the modeled variogram
as well as charts published by Journel and Huijbregts (1978)
.
This value estimates the
variance from applying a single central measurement to increasingly larger square blocks.
Care was taken to ensure any nugget effect present was added back into the data. This
process was repeated for each test block size.
The final step of the process is to calculate the global estimation variance. In this step the
number square blocks that would fit inside the selected study area is determined for each
block size that was investigated in the previous step. The estimation variance is then divided
by the number of blocks that would fit inside the study area for each test block size.
Following this determination, the data is then transformed back to represent the relative
error in the 95
th
-percentile range.
Figure 11 -4
shows the results of the DHSA performed on the Upper Freeport data for the
Mon Valley Complex. DHSA provides hole to hole spacing values, these distances need to
be converted to radius from a central point in order to compare to the historical standards.
A summary of the radius data is shown in
Table 11-2
. DHSA prescribes measured,
indicated, and inferred drill hole spacings be determined at the 10-percent, 20-percent, and
50-percent levels of relative error, respectively.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
![ex964p38i1.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p38i1.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
29
Figure 11-4: Result of DHSA for the Upper Freeport Seam Present in the Mon Valley
Complex
Table 11 -2: DHSA Results Summary for Radius from a Central Point
Model:
Measured Radial Distance
(10% Relative Error)
Indicated Radial
Distance
(20% Relative Error)
Inferred Radial
Distance
(50% Relative Error)
(km)
(km)
(km)
Gaussian:
0.72
1.42
3.53
Spherical:
0.72
1.42
3.53
Exponential:
0.75
1.43
3.49
Comparing the results of the DHSA to the historical standards, it is evident that the historical
standards are more conservative than even the most conservative DHSA model with
regards to determining measured resources. The Gaussian and Spherical models
recommend using a radius of 0.72 kilometers for measured resources compared to the
historical value of 0.4 kilometers. With respect to indicated resources the DHSA falls in line
closely with the historical standards. The Exponential model recommends using a radius of
1.43 kilometers, while the Spherical and Gaussian models recommend a radius of 1.42
kilometers, respectively. These values line up closely with the historical radius of 1.2
kilometers. These results have led the QPs to report the data following the historical
classification standards, rather than use the results of the DHSA.
11.2 Qualified Person’s Estimates
Mineral resources, representing in-situ coal in which a portion of reserves are derived, are
presented below. Based on the work described and detailed modelling of the areas
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
30
considering all the parameters defined, a coal resource estimate, summarized in
Table 11-
3
, was prepared as of December 31, 2021, for property controlled by Coronado.
Table 11 -3: Coal Resources Summary as of December 31, 2021
Coal Resource (Dry Tonnes, In Situ, Mt)
Resource Quality (Dry)
Area
Measured
Indicated
Inferred
Total
Ash%
Sulfur%
VM%
Inclusive of Reserve
291.0
213.5
9.3
513.8
31
1.4
26
Exclusive of Reserve
0.0
0.0
0.0
0.0
Total 12/31/2021
291.0
213.5
9.3
513.8
Note: Resource tonnes are inclusive of reserve tonnes since they include the in-situ tonnes from which recoverable coal reserves
are derived.
Note 2: Coal resources are reported on a dry basis. Surface moisture and inherent moisture are excluded.
Note 3: The Mon Valley properties do not have any resource tonnes exclusive of reserves as of December 31, 2021.
11.3 Qualified Person’s Opinion
While there is some level of stratigraphically controlled seam-thickness variability due to
sand channels, etc., the Upper Freeport coal seam on the mine property at Mon Valley
demonstrate reasonable thickness consistency according to the classification system of
measured
indicated
inferred
deposit and delineated mineable regions to reflect the nature of each seam and the
practicality of mining constraints. Based on MM&A’s geostatistical analysis, it would be
possible to extend the measured, indicated and inferred arcs slightly beyond historically
accepted practices due to consistent geological settings. The QPs have again elected not
to extend arc distances, introducing a level of conservatism in measured and indicated coal
classification.
Based on the data review, the attendant work done to verify the data integrity and the
creation of an independent geologic model, the QPs believe this is a fair and accurate
representation of the Mon Valley coal resources.
12
Mineral Reserve Estimates
12.1 Assumptions, Parameters and Methodology
Coal Reserves are classified as
proven
probable
mining, metallurgical, economic, marketing, legal, environmental, social, and governmental
factors.
>
Proven Coal Reserves
resource, adjusted for diluting materials and allowances for losses when the material is
mined. It is based on appropriate assessment and studies in consideration of and
adjusted for reasonably assumed modifying factors. These assessments demonstrate
that extraction could be reasonably justified at the time of reporting.
>
Probable Coal Reserves
resource, and in some circumstances a measured coal resource, adjusted for diluting
materials and allowances for losses when the material is mined. It is based on
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
31
appropriate assessment and studies in consideration of and adjusted for reasonably
assumed modifying factors. These assessments demonstrate that extraction could be
reasonably justified at the time of reporting.
Upon completion of delineation and calculation of coal resources, MM&A generated a LOM
plan for each of the projected mines within the Mon Valley Complex. The footprint of each
reserve area is shown on the maps in
Appendix B
. The mine plans were generated based
on the forecast mine plan and permit plan provided by Coronado with modifications by
MM&A where necessary due to current property control limits, modifications to geologic
mapping, or other factors determined during the evaluation.
Carlson Mining software was used to generate the LOM plan for Mon Valley. The mine plan
was sequenced based on productivity schedules provided by Coronado. MM&A determined
the productivity estimates and plans to be reasonable based on experience and current
industry practice.
At the Mon Valley mines, a minimum mining height of 1.4 meters was generally used due to
the continuous mining method being employed; however, Pangburn was mapped at a 0.92-
meter cutoff in conjunction with the Coronado mine plan. For coal seams thinner than the
assigned mining height, the difference between the coal seam height and assigned mining
height consists of out-of-seam dilution (
OSD
). Mine recovery generally varies between 40
percent and 55 percent for continuous mining panels. Plant recovery is a function of in-
seam recovery, OSD and plant efficiency factor, which is set at 95 percent. Typical entry
width is 5.8 meters.
Raw, ROM production data outputs from LOM plan sequencing were processed into
Microsoft
®
the economic model. Average seam densities were estimated to determine raw coal tonnes
produced from the LOM plan. Average mine recovery and wash recovery factors were
applied to determine coal reserve tonnes.
Coal reserve tonnes in this evaluation are reported at a 6.0 percent moisture and represent
the saleable product from the Property.
Pricing data as provided by Coronado is described in
Section 16.2
. The pricing data
assumes HVB domestic and export FOB-mine prices of approximately $137 and $120 per
metric tonne for calendar year 2027. HVB domestic and export prices respectively increase
to approximately $221 and $193 per metric tonne through year 2050, and then increased by
1% annual inflation thereafter.
The coal resource mapping and estimation process, described in the report, was used as a
basis for the coal reserve estimate. Proven and probable coal reserves were derived from
the defined coal resource considering relevant processing, economic (including technical
estimates of capital, revenue, and cost), marketing, legal, environmental, socio-economic,
and regulatory factors and are presented on a moist, recoverable basis.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
32
As is customary in the USA, the categories for proven and probable coal reserves are based
on the distances from valid points of measurement as determined by the QPs for the area
under consideration. For this evaluation, measured resource, which may convert to a
proven reserve, is based on a 0.4-kilometer radius from a valid point of observation.
Points of observation include exploration drill holes, degas holes, and mine measurements
which have been fully vetted and processed into a geologic model. The geologic model is
based on seam depositional modeling, the interrelationship of overlying and underlying
strata on seam mineability, seam thickness trends, the impact of seam structure (i.e.,
faulting), intra-seam characteristics, etc. Once the geologic model was completed, a
statistical analysis, described in
Section 11.1.1
from a valid point of observation was selected to define Measured Resources.
Likewise, the distance between 0.4 and 1.2 of a kilometer radius was selected to define
Indicated Resources. Indicated Resources may convert to Probable Reserves
Inferred Resources (greater than a 1.2-kilometer radius from a valid point of observation)
are to be excluded from Reserve consideration.
12.2 Qualified Person’s Estimates
Reserve tonnage estimates provided herein report coal reserves derived from the in-situ
resource tons presented in
Table 11 -3
, and not in addition to coal resources. Coal reserves
are presented on a ROM basis in
Table 12-1
. Proven and probable coal reserves were
derived from the defined coal resource considering relevant mining, processing,
infrastructure, economic (including estimates of capital, revenue, and cost), marketing, legal,
environmental, socio-economic and regulatory factors. The coal reserves, as shown in
Table 12-2
, are based on a technical evaluation of the geology and a preliminary feasibility
study of the coal deposits. The extent to which the coal reserves may be affected by any
known environmental, permitting, legal, title, socio-economic, marketing, political, or other
relevant issues has been reviewed rigorously. Similarly, the extent to which the estimates
of coal reserves may be materially affected by mining, metallurgical, infrastructure and other
relevant factors has also been considered.
Table 12-1: Coal Summary (ROM Basis (Moist)) as of December 31, 2021 (Mt)
Demonstrated Coal Reserves (Mt, Moist ROM)
By Reliability Category
By Mining Type
By Control Type
Quality (Dry)
Area /
Mine
Proved
Probable
Total
Surface
UG
Owned
Leased
Ash
Sulfur
Vol
Mon Valley
113.9
83.2
197.1
0.0
197.1
195.7
1.4
37
1.4
23
Table 12-2: Coal Reserves Summary (Marketable Sales Basis) as of December 31, 2021 (Mt)
Demonstrated Coal Reserves (Wet Tons, Washed or Direct Shipped, Mt)
Quality (Dry Basis)
By Reliability Category
By Mining Type
By Control Type
Property
Proven
Probable
Total
Surface
UG
Owned
Leased
Ash%
Sulfur%
VM%
Mon Valley
77.8
56.6
134.4
0.0
134.4
133.4
1.0
8
1.4
35
combination of surface and inherent moisture is modeled at 6-percent. Actual product moisture is dependent upon multiple
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
33
geological factors, operational factors, and product contract specifications and can exceed 8-percent. As such, the modeled
moisture values provide a level of conservatism for reserve reporting.
The results of this TRS define an estimated 134.4 Mt of proven and probable marketable
coal reserves. Of that total, 58 percent are proven, and 42 percent are probable. There are
133.4 Mt of owned coal reserves and 1.0 Mt of leased coal reserves. All of the Mon Valley
reserves are considered to be suitable for the metallurgical coal market. All of the Mon
Valley reserves are unassigned.
12.3 Qualified Person’s Opinion
The estimate of coal reserves was determined in accordance with the JORC Code along
with SEC Regulation S-K 1300.
The LOM mining plans for Mon Valley were prepared to the level of preliminary feasibility.
Mine projections were prepared, and timing scheduled to match production with coal seam
characteristics. Production timing was carried out from current locations to depletion of the
coal reserve area. Coal reserve estimates could be materially affected by the risk factors
described in
Section 22.2
.
Based on the Preliminary Feasibility Study and the attendant Economic Review, the QPs
believe this is a fair and accurate calculation of the Mon Valley coal reserves.
13
Mining Methods
Three separate underground mine areas were modeled and tested economically for the Mon
Valley Complex. Once the Resources were calculated, mine plans were created to project
operating each resource area to depletion, with crews and equipment scheduled to move to
subsequent mining areas as depletion occurs. Underground mine operations are projected
to be exhausted in 2099.
13.1 Geotech and Hydrology
Mining plans for potential underground mines were developed by Coronado and MM&A.
Pillar stability was tested by MM&A using the
Analysis of Coal Pillar Stability (ACPS)
program that was developed by the
National Institute for Occupational Safety and Health
(
NIOSH
)
. MM&A reviewed the results from the ACPS analysis and considered them in the
development of the LOM plan.
Hydrology is not expected to be an issue of concern at Mon Valley. Extensive mining has
occurred in the Pittsburgh seam, 183 meters above the Upper Freeport horizon. The Upper
Freeport coal has been mined in the region—based on successful historical mining in
comparable geologic settings, material impacts related to hydrology are not anticipated to
be of concern.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
34
13.2 Production Rates
The Mon Valley Complex is not yet active, with three distinct mines and preparation plants
planned. The mine plan and productivity expectations reflect historical performance of
similar operations and efforts have been made to adjust the plan to reflect future conditions.
MM&A is confident that the mine plan is reasonably representative to provide an accurate
estimation of coal reserves. Mine development and operation has not been optimized within
the TRS.
Production is scheduled for approximately 273 days each year, which represents production
on Monday through Friday plus every other Saturday with allowances for holidays. On each
day, the continuous mining sections produce coal on two shifts; the third shift is reserved for
maintenance and mine conveyor belt and power moves. The sections are configured as full
super sections with two continuous miners per section. Productivity is planned at the rate
of 272 meters of advance per shift for the super sections.
Carlson Mining software was used by MM&A to generate mine plans for the underground
mineable coal seam. Mine plans were sequenced based on productivity schedules provided
by Coronado, which were based on historically achieved productivity levels. All production
forecasting ties assumed production rates to geological models as constructed by MM&A’s
team of geologists and mining engineers.
As shown in
Table 13-1
, the areas planned for underground mines produce coal until 2099.
Clean coal production varies directly with coal thickness.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
35
Table 13-1: Production Summary by Mine by Year (000)
Mine Name
2030
2031
2032
2033
2034
2035
2036
2037
Pangburn
0
440
1,995
2,067
2,158
2,237
2,238
1,868
Fallowfield
0
0
0
0
0
0
0
0
Shaner
0
0
0
0
0
0
0
404
0
440
1,995
2,067
2,158
2,237
2,238
2,273
Mine Name
2038
2039
2040
2041
2042
2043
2044
2045
Pangburn
1,476
702
665
0
0
0
0
0
Fallowfield
0
0
0
0
0
0
0
0
Shaner
684
1,240
1,944
1,989
1,901
1,892
1,809
1,895
2,160
1,943
2,608
1,989
1,901
1,892
1,809
1,895
Mine Name
2046
2047
2048
2049
2050
2051
2052
2053
Pangburn
0
0
0
0
0
0
0
0
Fallowfield
0
0
0
0
0
0
0
0
Shaner
1,826
1,744
1,879
1,825
1,909
1,876
1,759
1,810
1,826
1,744
1,879
1,825
1,909
1,876
1,759
1,810
Mine Name
2054
2055
2056
2057
2058
2059
2060
2061
Pangburn
0
0
0
0
0
0
0
0
Fallowfield
0
0
947
1,962
2,215
2,212
2,191
2,000
Shaner
1,929
1,930
1,929
1,980
1,899
2,028
1,957
1,845
1,929
1,930
2,876
3,942
4,114
4,239
4,147
3,844
Mine Name
2062
2063
2064
2065
2066
2067
2068
2069
Pangburn
0
0
0
0
0
0
0
0
Fallowfield
1,827
2,051
2,087
2,087
2,060
2,060
1,881
2,087
Shaner
1,910
1,770
1,658
1,176
1,055
672
674
436
3,737
3,821
3,745
3,264
3,115
2,732
2,555
2,523
Mine Name
2070
2071
2072
2073
2074
2075
2076
2077
Pangburn
0
0
0
0
0
0
0
0
Fallowfield
1,585
2,191
2,197
2,008
2,098
2,055
2,107
1,883
Shaner
0
0
0
0
0
0
0
0
1,585
2,191
2,197
2,008
2,098
2,055
2,107
1,883
Mine Name
2078
2079
2080
2081
2082
2083
2084
2085
Pangburn
0
0
0
0
0
0
0
0
Fallowfield
2,129
1,937
1,723
2,242
1,568
2,285
1,637
1,982
Shaner
0
0
0
0
0
0
0
0
2,129
1,937
1,723
2,242
1,568
2,285
1,637
1,982
Mine Name
2086
2087
2088
2089
2090
2091
2092
2093
Pangburn
0
0
0
0
0
0
0
0
Fallowfield
1,477
1,857
1,616
1,993
1,305
1,637
1,612
1,747
Shaner
0
0
0
0
0
0
0
0
1,477
1,857
1,616
1,993
1,305
1,637
1,612
1,747
Mine Name
2094
2095
2096
2097
2098
2099
2100
2101
Pangburn
0
0
0
0
0
0
0
0
Fallowfield
1,355
1,731
1,752
1,387
916
393
0
0
Shaner
0
0
0
0
0
0
0
0
1,355
1,731
1,752
1,387
916
393
0
0
13.3 Mining Related Requirements
A mine plan with sequenced mining projections was prepared for each logical mining unit.
For each mine plan, the appropriate number of production units is selected for the resource
area, and a productivity level assigned, expressed in meters of advance per unit-shift of
production. The productivity is based on the equipment and personnel configuration, mining
height and expected physical conditions.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
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13.4 Required Equipment and Personnel
Production from the proposed Mon Valley Complex mines will be conducted using the room
and pillar method, utilizing continuous miners and haulage using shuttle cars to a feeder-
breaker located at the tail of the section conveyor belt. The feeder-breaker crushes large
pieces of coal and rock and regulates coal feed onto the mine conveyor. Roof-bolting
machines are used for to support the roof on the continuous miner sections. Roof-bolting
machines are used to install roof bolts, and battery scoops are available to clean the mine
entries and assist in delivery of mine supplies to work areas. Other supplemental
equipment, such as personnel carriers, supply vehicles, etc., are also used daily.
Mine conveyors typically range in width up to 1.5 meters. Multiple belt flights are arranged
in series to deliver raw coal to the underground storage. Along the main and sub-main
entries and panels, a travel way is provided for personnel and materials by rubber-tired
equipment or on rail. The Mon Valley mines will use conveyors to transport ROM coal from
the underground production sections to the surface where the coal may be sampled,
crushed, washed in the preparation plant, and stockpiled to await shipment.
Surface ventilation fans are installed as needed to provide a sufficient volume of air to
ventilate production sections, coal haulage and transport entries, battery charging stations,
and transformers in accordance with approved plans. High-voltage cables deliver power
throughout the mine where transformers reduce voltage for specific equipment
requirements.
The Mine Improvement and New Emergency Response Act of 2006
MINER
Act
) requires that carbon monoxide detection systems be installed along mine conveyor
belts and that electronic two-way tracking and communications systems be installed
throughout underground mines. Water is required to control dust at production sections and
along conveyor belts, and to cool electric motors. Water is available from nearby sources
and is distributed within the mine by pipelines as required.
13.4.1 Mine: Pangburn
The Pangburn mine is proposed to start in 2031 with three continuous mining sections. The
Upper Freeport seam will be accessed via decline slope and vertical shaft. This mine will
produce metallurgical and steam coal from leased and owned mineral.
Production is scheduled for approximately 273 days each year, which represents production
on Monday through Friday and every other Saturday. On each day, three production
sections are scheduled to produce coal on two shifts; the third shift is reserved for
maintenance and mine conveyor belt and power moves. Each section is configured as full
supersection with two continuous miners available for production. Productivity is planned
at the rate of 272 meters of advance per shift for the super sections. A total of 203
employees are assigned to the mine.
Principal production equipment on each section includes two continuous miners, two roof
bolters, four shuttle cars, and two scoops. Coal is extracted from the production face with
the continuous miner and hauled to the mine conveyor in shuttle cars. At the conveyor belt,
the coal is discharged from the shuttle cars onto a feeder breaker for transfer onto the
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
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SSOCIATES
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37
conveyor. The conveyors carry the coal to the outside, where it is transported via overland
conveyor to the proposed Pangburn preparation plant and barge load-out on the
Monongahela River. Rail access is provided by a
CSX rail line.
The proposed Pangburn mine will be located approximately 1.6 kilometers south of the
community of Elizabeth, Pennsylvania. Main paved roads exist both east and west of the
site. The proposed dock, located on the western boundary of the proposed Pangburn permit
area, is currently used for bulk material transshipment. The area has hosted both industrial
and residential development for an extensive time period. No extraordinary measures or
expenses will be required to establish infrastructure or utilities at the Pangburn site.
The preliminary design for the Pangburn mine surface facilities was provided by Coronado.
The facilities include offices, warehouses, shops, and a bathhouse for personnel; a
preparation plant to process ROM coal; a refuse area with a designed capacity of
approximately 35 million refuse tonnes; raw coal storage at the plant totaling approximated
100,000 tonnes, clean coal storage at the plant site of approximately 54,000 tonnes, and
three clean coal stockpiles adjacent to the dock loading facility on the Monongahela River.
The three river stockpiles have a designed capacity of approximately 266,000 tonnes.
A study completed and approved through the
Pennsylvania Department of
Environmental Protection
disposal at Pangburn with capacity of 22.6 million cubic meters. MM&A’s estimated
requirements for Pangburn and Shaner combined is 29.7 million tonnes or approximately
13.2 million cubic meters.
The preliminary design layout of the Pangburn facilities is shown
Figure 13-1
.
![ex964p47i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p47i0.jpg)
![ex964p47i1.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p47i1.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
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Figure 13-1: Proposed Pangburn Plant and Mine Site Infrastructure
13.4.2 Mine: Shaner
The Shaner mine is a proposed mine in the Upper Freeport seam and is scheduled to begin
production in 2037 as the Pangburn reserve is depleted. This mine is a metallurgical and
steam coal operation on leased and owned mineral property.
Production is scheduled for approximately 273 days each year, which represents production
on Monday through Friday and every other Saturday. On each day, three production
sections are scheduled to produce coal on two shifts; the third shift is reserved for
maintenance and mine conveyor belt and power moves. All three sections are full super
sections with two continuous miners per section. Productivity is planned at the rate of 272
meters of advance per shift for the super sections. A total of 203 employees are assigned
to the mine.
Principal production equipment per section includes two continuous miners, two roof bolters,
four shuttle cars, and two scoops. Coal is extracted from the production face with the
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
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&
A
SSOCIATES
,
I
NC
.
39
continuous miner and hauled to the mine conveyor in shuttle cars. At the conveyor belt, the
coal is discharged onto a feeder breaker for transfer onto the conveyor. The conveyors
carry the coal to the outside and to the preparation plant and load-out.
The Shaner mine will be located approximately 1.6 kilometers north of the community of
Sutersville, Pennsylvania, between the Youghiogheny and Monongahela Rivers. Numerous
improved roads traverse the Property. An additional shaft and slope will be required to
access Upper Freeport seam reserves west of the Monongahela River, accessed across
the 1
st
Shaner surface facilities is well developed; no extraordinary measures or expenses will be
required to establish infrastructure or utilities at the Fallowfield site. Due to the projected
starting date for the Shaner mine, no detailed design of infrastructure or surface facilities
has been completed to date. The proposed mines are located in the Appalachian Basin,
which has an extensive history (>100 years) of coal mining. There is a sufficient population
base within commuting distance of the proposed operations; no Camp or Town construction
will be required. Mine opening capital expenditures are included in the MM&A financial
model.
Due to the projected start-up date of the Shaner mine, no permit work has been completed
to date. The proposed mine is located in an area with a long history of coal mining, with
numerous permitted operations in close proximity. Coal mining permits are routinely
obtained in this region; a 2-year to 3-year lead time is recommended. Estimated
expenditures for mine closure and site reclamation are included in the financial model for
each mine or plant site.
Infrastructure for Shaner will resemble that shown in
Figure 13-1
13.4.3 Mine: Fallowfield
The Fallowfield mine is proposed to start in 2056 with three production sections. The Upper
Freeport seam will be accessed via a decline slope and vertical shaft. This mine will be a
metallurgical coal and steam coal operation on leased and owned mineral property.
Production is scheduled for approximately 273 days each year, which represents production
on Monday through Friday and every other Saturday. On each day, three production
sections are scheduled to produce coal on two shifts; the third shift is reserved for
maintenance and mine conveyor belt and power moves. The sections are configured as
super sections with two continuous miners available for production. Productivity is planned
at the rate of 272 meters of advance per shift of operation. A total of 203 employees are
assigned to the mine.
Principal production equipment includes two continuous miners, two roof bolters, four shuttle
cars, and two scoops. Coal is extracted from the production face with the continuous miner
and hauled to the mine conveyor in shuttle cars. At the conveyor belt, the coal is discharged
from the shuttle cars onto a feeder breaker for transfer onto the conveyor. The conveyors
carry the coal to the outside, where it is transported to the Fallowfield preparation plant and
truck load-out via overland conveyor.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
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&
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SSOCIATES
,
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40
The Fallowfield property boundary is traversed by the four-lane limited-access Mon-Fayette
Expressway in addition to numerous improved roads. Previous mining and coal preparation
facilities have existed in the immediate vicinity of the proposed Fallowfield surface facilities.
No extraordinary measures or expenses will be required to establish infrastructure or utilities
at the Fallowfield site. Due to the projected starting date for the Fallowfield mine, no detailed
design of infrastructure or surface facilities has been completed to date. The proposed
mines are located in the Appalachian Basin, which has an extensive history (greater than
100 years) of coal mining. There is a sufficient population base within commuting distance
of the proposed operations; no Camp or Town construction will be required. Mine opening
capital expenditures are included in the MM&A financial model.
Due to the projected start-up date of the Fallowfield mine, no permit work has been
completed to date. The proposed mine is located in an area with a long history of coal
mining, with numerous permitted operations in close proximity. Coal mining permits are
routinely obtained; a two- to three-year lead time is recommended. Estimated expenditures
for mine closure and site reclamation are included in the financial model for each mine or
plant site.
Infrastructure for Fallowfield will resemble that shown in
Figure 13-1
14
Processing and Recovery Methods
14.1 Description or Flowsheet
Due to the projected starting date for the Mon Valley Complex, only preliminary design of
preparation plant or associated material handling facilities has been initiated to date. Coal
processing is a well understood science—it is anticipated that typical coal sizing, cleaning
and dewatering equipment will be utilized for processing of run-of-mine coal at Pangburn,
including combinations of vibratory screens, classifying cyclones, heavy media baths, heavy
media cyclones, spirals, froth flotation, and drain-and-rinse screens, screen-bowl
centrifuges, among others. No novel technologies will be required to process run-of-mine
material.
14.2 Requirements for Energy, Water, Material and Personnel
The Mon Valley property has sources of water, power, personnel, and supplies readily
available for use. Personnel have historically been sourced from the surrounding
communities in Allegheny, Washington, and Westmoreland Counties, and have proven to
be adequate in numbers to operate the mines. As mining is common in the surrounding
areas, the workforce is generally familiar with mining practices, and many are experienced
miners. Water is expected to be sourced locally from nearby public water sources or rivers.
Electricity is anticipated to be sourced from West Penn
or Duquesne Light. The service
industry in the areas surrounding the proposed mine complex has historically provided
supplies, equipment repairs and fabrication, etc. Barge transport on the Monongahela
River/Ohio River system will serve as the main means of product transport from the mine,
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
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and currently serve as a means of coal transportation for neighboring Pittsburgh seam
operations.
15
Infrastructure
Due to the projected starting date for the Mon Valley mines, only conceptual design of
infrastructure and surface facilities has been completed to date.
The proposed Pangburn mine will be located approximately 1.6 kilometers south of the
community of Elizabeth, PA. Main paved roads exist both east and west of the site. The
proposed dock, located on the western boundary of the proposed Pangburn permit area, is
currently used for bulk material transhipment. The area has hosted both industrial and
residential development for an extensive time period. No extraordinary measures or
expenses will be required to establish infrastructure or utilities at the Pangburn site.
The Shaner mine will be located approximately 1.6 kilometers north of the community of
Sutersville, PA, between the Youghiogheny and Monongahela Rivers. Numerous improved
roads traverse the Property. An additional shaft and slope will be required to access Upper
Freeport seam reserves west of the Monongahela River, accessed across the 1
st
bridge and Douglass Run Road. The immediate vicinity of the proposed Shaner surface
facilities is well developed; no extraordinary measures or expenses will be required to
establish infrastructure or utilities at the Shaner site.
The Fallowfield property boundary is traversed by the 4-lane limited-access Mon-Fayette
Expressway in addition to numerous improved roads. Previous mining and coal preparation
facilities have existed in the immediate vicinity of the proposed Fallowfield surface facilities.
No extraordinary measures or expenses will be required to establish infrastructure or utilities
at the Fallowfield site. Due to the projected starting date for the Fallowfield mine, no detailed
design of infrastructure or surface facilities has been completed to date.
A CSX rail line and loadout on the Monongahela River as well as barge transportation on
the river are expected to serve as the primary means of transport for produced coal.
16
Market Studies
16.1 Market Description
The quality characteristics for the subject coal resources and coal reserves have been
reviewed in detail by MM&A. The drill hole data were utilized to develop average coal quality
characteristics for the mining site. These average coal quality characteristics were then
utilized as the basis for determining the various markets into which the saleable coal will
likely be placed.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
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&
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The projected quality specifications for the Mon Valley products are as shown in
Table 16-
1
.
Table 16-1: Quality Specifications by Product
HVB
Moisture (%)
7.50
Ash (%)
7.50
Sulfur (%)
1.2
Volatile Matter (%)
35
Btu/lb.
N/A
Fluidity (ddpm)
26,000
MMR (%)
0.98
CSR
55
FSI
7.50
Note: All Specs are dry basis except Moisture.
Life-
of-mine sulfur for Pangburn is an estimated 1.21%;
however, overall Mon Valley Complex reserve
average is 1.36% sulfur.
All of the mine production is projected to serve the metallurgical markets. The metallurgical
coal is marketed as a high-volatile (typically greater than 31 percent volatile matter content)
product on both the domestic and export markets.
16.2 Price Forecasts
Coronado provided MM&A with price forecasts for its active operations. Customer coal
pricing is derived from market observed forward estimates based on global economic supply
and demand analysis which is applied to mine plan sales volumes and product mix and is
supplemented with Coronado’s in-house knowledge of applicable rail transportation
charges, ocean freight charges and port charges. MM&A extrapolated the provided data for
the greenfield Mon Valley operations. Concurrent with aforementioned quality parameters
in the preceding section, production from the proposed operations is assumed to be sold in
high volatile domestic and export coal markets with respective percentages of 66 percent
and 34 percent. The pricing data assumes HVB domestic and export FOB-mine prices of
approximately $137 and $120 per metric tonne for calendar year 2027. HVB domestic and
export prices respectively increase to approximately $221 and $193 per metric tonne
through year 2050, and then increased by 1% annual inflation thereafter.
Coal price forecasts for the Mon Valley products were provided by Coronado for various
coal markets in terms of US nominal dollars per metric tonne.
16.3 Contract Requirements
Some contracts are necessary for successful marketing of the coal. For Mon Valley, since
all mining, preparation and marketing is done in-house, the remaining contracts required
are:
>
Transportation
Railroad to transport the coal to either of the domestic customers ports for overseas
shipments.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
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&
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SSOCIATES
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43
>
Handling
typically handled by annual negotiations based on projected shipments.
>
Sales
– Sales contracts are a mix of spot and contract sales. With the volatility of the
market, long-term contracts are not typically written.
17
Environmental Studies, Permitting and Plans,
Negotiations or Agreements with Local
Individuals
17.1 Results of Studies
MM&A is not aware of any Phase I Environmental Site Assessment (
ESA
) completed on the
Mon Valley property on behalf of Coronado. Coronado reports not having conducted such
a study. Based on our experience with Coronado, it is the QPs’ opinion that Coronado has
a generally typical coal industry record of compliance with applicable mining, water quality,
and environmental laws. Estimated costs for mine closure, including water quality
monitoring during site reclamation, are included in the financial models.
17.2 Requirements and Plans for Waste Disposal
A study completed on behalf of Coronado has identified a Preferred Site for refuse disposal
at Pangburn with capacity of 22.6 million cubic meters. Estimated requirements for
Pangburn and Shaner combined is 29.7 million tonnes or approximately 13.2 million cubic
meters. Permitting for such a facility is anticipated to be achievable.
17.3 Permit Requirements and Status
All mining operations are subject to federal and state laws and must obtain permits to
operate mines, coal preparation and related facilities, haul roads, and other incidental
surface disturbances necessary for mining to occur. Permits generally require that the
permittee post a performance bond in an amount established by the regulatory program to
provide assurance that any disturbance or liability created during mining operations is
properly restored to an approved post-mining land use and that all regulations and
requirements of the permits are fully satisfied before the bond is returned to the permittee.
Significant penalties exist for any permittee who fails to meet the obligations of the permits
including cessation of mining operations, which can lead to potential forfeiture of the bond.
Any company, and its directors, owners, and officers, which are subject to bond forfeiture
can be denied future permits under the program.
1
The refuse disposal area will receive combined coarse refuse from the proposed preparation
plant by conveyor belts. The fine material will be processed by filter press technology where
1
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
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SSOCIATES
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44
the majority of the water is removed. The filter cake material will be placed on the refuse
conveyor for disposal with the coarse portion of the refuse material.
New permits or permit revisions will occasionally be necessary to facilitate the expansion or
addition of new mining areas on the properties, such as amendments to existing permits
and new permits for mining of reserve areas. Exploration permits also are required.
Property under lease includes provisions for exploration among the terms of the lease. New
or modified mining permits are subject to a public advertisement process and comment
period, and the public is provided an opportunity to raise objections to any proposed mining
operation. MM&A is not aware of any specific prohibition of mining on the subject property
and given sufficient time and planning, Coronado should be able to secure new permits to
maintain its planned mining operations within the context of current regulations. Portions of
the properties are located near local communities. Regulations prohibit mining activities
within 91 meters of a residential dwelling, school, church, or similar structure unless written
consent is first obtained from the owner of the structure. Where required, such consents
have been obtained where mining is proposed beyond the regulatory limits.
MM&A is unaware of any obvious or current Coronado permitting issues that are expected
to prevent the issuance of future permits. Coronado, along with all coal producers, is subject
to a level of uncertainty regarding future clean water permits due to
United States
Environmental Protection Agency
(
EPA
)
17.4 Local Plans, Negotiations or Agreements
MM&A found no indication of requirements for agreements beyond the scope of Federal or
State Regulations.
17.5 Mine Closure Plans
Applicable regulations require that mines be properly closed, and reclamation commenced
immediately upon abandonment. In general, site reclamation includes removal of
structures, backfilling, regrading, and revegetation of disturbed areas. Sediment control is
required during the establishment of vegetation, and bond release generally requires a
minimum five-year period of site maintenance, water sampling, and sediment control
following mine completion. This requirement is reduced to two years for certain operations
involving re-mining. Reclamation of underground mines includes closure and sealing of
mine openings such as portals and shafts in addition to the items listed above.
Estimated costs for mine closure, including water quality monitoring during site reclamation,
are included in the financial model. As with all mining companies, an accretion calculation
is performed annually so the necessary Asset Retirement Obligations (
ARO
) can be shown
as a Liability on the Balance Sheet.
17.6 Qualified Person’s Opinion
The QPs know
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
![ex964p14i1.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p14i1.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
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&
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SSOCIATES
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Estimated expenditures for site closure and reclamation are included in the financial model
for these sites.
18
Capital and Operating Costs
18.1 Capital Cost Estimate
The production sequence selected for a property must consider the proximity of each
reserve area to coal preparation plants, river docks and railroad loading points, along with
suitability of production equipment to coal seam conditions. The in-place infrastructure was
evaluated, and any future needs were planned to a level suitable for a Preliminary Feasibility
Study and included in the Capital Forecast.
MM&A
developed capital spending estimates for the proposed operations in the Mon Valley
Complex. MM&A’s capital schedules assume that major equipment rebuilds occur over the
course of each machine’s remaining assumed operating life. Replacement equipment was
scheduled based on MM&A’s experience and knowledge of mining equipment and industry
standards with respect to the useful life of such equipment.
A summary of the estimated capital for the Property is provided in
Figure 18-1
Figure 18-1: CAPEX
18.2 Operating Cost Estimate
Coronado provided a historical summary of operating costs for similar operations for
MM&A’s review. MM&A used the historical and/or budget cost information as a reference
and developed a personnel schedule for the mine. Hourly labor rates and salaries were
based upon information contained in Coronado’s financial summaries. Fringe benefit costs
were developed for vacation and holidays, federal and state unemployment insurance,
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
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retirement, workers’ compensation and pneumoconiosis, casualty and life insurance,
healthcare, and bonuses. A cost factor for mine supplies was developed that relates
expenditures to mine advance rates for roof control costs and other mine supply costs
experienced at underground mines. Other factors were developed for maintenance and
repair costs, rentals, mine power, outside services and other direct mining costs.
Other cost factors were developed for coal preparation plant processing, refuse handling,
coal loading, property taxes, and insurance and bonding. Appropriate royalty rates were
assigned for production from leased coal lands and sales taxes were calculated for federal
black lung excise tax, and federal reclamation fees. There are currently no state coal
severance or reclamation taxes required in Pennsylvania.
Mandated Sales Related Costs such as Black Lung Excise are summarized in
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
47
Table 18-1: Estimated Coal Production Taxes and Sales Costs
Description of Tax or Sales Cost
Basis of Assessment
Cost
Federal Black Lung Excise Tax -
Underground
Per Tonne
$1.21
Federal Reclamation Fees – Underground
Per Tonne
$0.13
Royalties – Underground
Percentage of Revenue
7%
Note:
1. Federal black lung excise tax is paid only on coal sold domestically. MM&A assumed 45% of total coal
sales to be domestic in the economic analysis discussed below.
A summary of the projected Operating Costs is in
Table 18-2
.
Table 18-2: Mon Valley Operating Costs
YE
12/31
2022
YE
12/31
2023
YE
12/31
2024
YE
12/31
2025
YE
12/31
2026
YE
12/31
2027
YE
12/31
2028
YE
12/31
2029
Remaining
Total
LOM
Average
ROM Production Tonnes
198.4
-
-
-
-
-
-
-
-
2.8
Yield
68.19%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
68.19%
Saleable Production
Tonnes
*
135.3
-
-
-
-
-
-
-
-
2.0
Thermal Tonnes
-
-
-
-
-
-
-
-
-
-
Domestic Met Tonnes
89.3
-
-
-
-
-
-
-
-
1.3
Export Met Tonnes
46.0
-
-
-
-
-
-
-
-
0.7
135.3
-
-
-
-
-
-
-
-
2.0
Cash Costs per Tonne:
Mining Costs
$98.16
$-
$-
$-
$-
$-
$-
$-
$-
Processing and
Transport
$-
$-
$-
$-
$-
$-
$-
$-
Sales Related Costs
$-
$-
$-
$-
$-
$-
$-
$-
G&A
$-
$-
$-
$-
$-
$-
$-
$-
$-
$-
$-
$-
$-
$-
$-
$-
Financial model includes 0.9 million tonnes of inferred coal production. Inferred coal represents 0.6% of the total production, and none of this coal was
included in the estimate of reserves.
19
Economic Analysis
19.1 Assumptions, Parameters and Methods
A pre-feasibility LOM plan was prepared by MM&A for the proposed Mon Valley operations.
MM&A prepared mine projections and production timing forecasts based on coal seam
characteristics. Production timing was carried out from 2031 to depletion (exhaustion) of
the coal reserve areas, which is projected for the year 2099. All costs and prices are based
on 2021 nominal United States dollars.
The Mine plan, productivity expectations and cost estimates generally reflect historical
performance by Coronado and efforts have been made to adjust plans and costs to reflect
future conditions. MM&A is confident that the mine plan and financial model are reasonably
representative to provide an accurate estimation of coal reserves.
Capital schedules were developed by MM&A for mine development, infrastructure, and on-
going capital requirements for the life of the mine. Staffing levels were prepared, and
operating costs estimated by MM&A. MM&A utilized historical cost data provided by
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
48
Coronado and its own knowledge and experience to estimate direct and indirect operating
costs.
The preliminary feasibility financial model, prepared for this TRS, was developed to test the
economic viability of the coal reserve area. The results of this financial model are not
intended to represent a bankable feasibility study, required for financing of any current or
future mining operations, but are intended to prove the economic viability of the estimated
coal reserves. All costs and prices are based on 2021 nominal United States dollars
assuming a 2% inflation rate with one noted exception. An inflation rate of 1% was applied
to the sales price after year 2050.
On an unlevered basis, the NPV of the project cash flows after taxes was estimated for the
purpose of classifying coal reserves. The project cash flows, excluding debt service, are
calculated by subtracting direct and indirect operating expenses and capital expenditures
from revenue. Direct costs include labor, drilling and blasting, operating supplies,
maintenance and repairs, facilities costs for materials handling, coal preparation, refuse
disposal, coal loading, sampling and analysis services, reclamation and general and
administrative costs. Indirect costs include statutory and legally agreed upon fees related
to direct extraction of the mineral. The indirect costs are the Federal black lung tax, Federal
reclamation taxes, property taxes, local transportation prior to delivery at rail or barge
loading sites, coal production royalties, sales and use taxes, and income taxes. Coronado’s
historical costs provided a useful reference for MM&A’s cost estimates.
Sales revenue is based on the metallurgical coal price information provided to MM&A by
Coronado.
Projected debt service is excluded from the P&L and cash flow model in order to determine
Enterprise Value.
The financial model expresses coal sales prices, operating costs, and capital expenditures
in current day dollars without adjustment for inflation. Capital expenditures and reclamation
costs are included based on engineering estimates for each mine by year. The Coronado
division’s existing allocations of administrative costs are continued in the future projections.
Coronado will pay royalties for the various current and projected operations. The royalty
rates vary by mining method and location. The royalty rates for Mon Valley are estimated
to be 7% of the sales revenue.
The projection model also includes consolidated income tax calculations at the Coronado
level, incorporating statutory depletion calculations, as well as state income taxes, and a
federal tax rate of 21%. To the extent the mine generates net operating losses for tax
purposes, the losses are carried over to offset future taxable income. The terms “cash flows”
and “project cash flows” used in this report refer to after tax cash flows.
Consolidated cash flows are driven by annual sales tonnage, which grows from 0.4 million
tonnes in 2031 to a peak of 3.8 million tonnes in 2059. Between years 2060 and 2089, sales
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
![ex964p58i1.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p58i1.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
49
ranges from 1.5 million to 2.7 million tonnes and between years 2090-2099, sales range
from 0.4 million tonnes to 1.3 million tonnes. Projected consolidated revenue grows from
$57.4 million in 2031 to a peak of $891.5 million in 2059. Revenue totals $32.7 billion for
the project’s life.
Consolidated cash flow from operations is positive throughout the projected operating
period, with the exception of post-production years, due to end-of-mine reclamation
spending. Consolidated cash flow from operations peaks at $359.2 million in 2059 and
totals $9.0 billion over the project’s life. Capital expenditures total $485.8 million during the
first five years and $3.3 billion over the project’s life.
Coal price forecasts for coal products were prepared by Coronado for its active operations
and modified appropriately by MM&A for its greenfield operations. Such prices were used
for the revenue input into the financial model. Sales variable costs such as production
royalties were based upon the revenue input.
19.2 Results
The pre-feasibility financial model, prepared by MM&A for this TRS, was developed to test
the economic viability of each coal resource area. The results of this financial model are not
intended to represent a bankable feasibility study, as may be required for financing of any
current or future mining operations contemplated but are intended to prove the economic
viability of the estimated coal reserves. Optimization of the LOM plan was outside the scope
of the engagement.
Figure 19-1
Table 19-1
tonnage, P&L, and EBITDA for each proposed Coronado mines in Mon Valley .
Figure 19-1: Cash Costs per Tonne
As shown above, the mines’ average cash cost ranges between approximately $56 and
$311 per tonne for most of the operating period.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
50
Table 19-1: Life-of-Mine Tonnage, P&L before Tax, and EBITDA ($000)
LOM
LOM
P&L
LOM
EBITDA
Tonnes
*
Pre-Tax P&L
Per Tonne
EBITDA
Per Tonne
Pangburn
14,376
$701,483
$48.80
$1,259,113
$87.59
Fallowfield
72,640
$4,712,144
$64.87
$6,688,054
$92.07
Shaner
48,294
$4,656,184
$96.41
$5,641,238
$116.81
Consolidated PA Deep Mines
135,309
$10,069,811
$74.42
$13,588,405
$100.42
Note: *Financial model includes 0.9 million tonnes of inferred coal production. Inferred coal represents
0.6% of the total production, and none of this coal was included in the estimate of reserves.
As shown in
Table 19-1,
Coronado’s consolidated operations show positive LOM P&L and LOM EBITDA of $10.0
billion and $13.6 billion, respectively. A summary of the key financial performance metrics
projected for years is provided below in
Table 19-2
.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
51
Table 19-2: Summary of Mon Valley Key Financial Performance Metrics (2021-2029)
YE
12/31
2022
YE
12/31
2023
YE
12/31
2024
YE
12/31
2025
YE
12/31
2026
YE
12/31
2027
YE
12/31
2028
YE
12/31
2029
Remaining
Total
LOM
Average
ROM Production Tonnes
198.4
-
-
-
-
-
-
-
-
2.8
Yield
68.19%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
68.19%
Saleable Production
Tonnes
*
135.3
-
-
-
-
-
-
-
-
2.0
Thermal Tonnes
-
-
-
-
-
-
-
-
-
-
Domestic Met Tonnes
89.3
-
-
-
-
-
-
-
-
1.3
Export Met Tonnes
46.0
-
-
-
-
-
-
-
-
0.7
135.3
-
-
-
-
-
-
-
-
2.0
Cash Costs per Tonne:
Mining Costs
$98.16
$-
$-
$-
$-
$-
$-
$-
$-
$98.13
Processing and
Transport
$36.04
$-
$-
$-
$-
$-
$-
$-
$-
$36.04
Sales Related Costs
$1.73
$-
$-
$-
$-
$-
$-
$-
$-
$1.73
G&A
$5.42
$-
$-
$-
$-
$-
$-
$-
$-
$5.42
$141.35
$-
$-
$-
$-
$-
$-
$-
$-
$141.33
EBITDA per Tonne
$100.15
$-
$-
$-
$-
$-
$-
$-
$-
$100.18
Expansion CapEx ($M)
$35.82
$1.02
$-
$-
$-
$-
$5.09
$29.72
$-
$-
Maintenance CapEx ($M)
$3,258.12
$-
$-
$-
$-
$-
$-
$-
$35.26
$43.58
$3,293.95
$1.02
$-
$-
$-
$-
$5.09
$29.72
$35.26
$43.58
● Financial model includes 0.9 million tonnes of inferred coal production. Inferred coal represents 0.6% of the
total production, and none of this coal was included in the estimate of reserves.
After-Tax Cash Flows were developed in order to calculate the NPV for this Property. The
NPV is estimated to be $287.3 million at a discount rate of 10.0%. A summary of the Mon
Valley after-tax cash flow is shown in
Table 19-3
.
Table 19-3: Project Cash Flow Summary (000)
*
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
Total
2026
2027
2028
2029
2030
Production & Sales tonnes
135,311
-
-
-
-
-
Total Revenue
$32,678,158
$-
$-
$-
$-
$-
EBITDA
$11,822,150
$(369)
$(369)
$(369)
$(369)
$(369)
Net Income
$5,925,986
$(369)
$(369)
$(369)
$(369)
$(369)
Net Cash Provided by Operating Activities
$9,042,337
$(369)
$(369)
$(369)
$(369)
$(312)
Purchases of Property, Plant, and Equipment
$(3,293,945)
$-
$(5,087)
$(29,721)
$(35,261)
$(215,753)
Net Cash Flow
$5,748,391
$(369)
$(5,456)
$(30,090)
$(35,629)
$(216,065)
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
2031
2032
2033
2034
2035
2036
Production & Sales tonnes
399
1,810
1,875
1,958
2,029
2,030
Total Revenue
$57,415
$266,199
$281,967
$301,091
$319,037
$326,330
EBITDA
$31,974
$163,768
$175,562
$191,169
$204,833
$209,981
Net Income
$(43,182)
$84,520
$86,628
$82,382
$94,260
$106,329
Net Cash Provided by Operating Activities
$25,910
$135,802
$160,145
$157,652
$168,511
$179,238
Purchases of Property, Plant, and Equipment
$(199,931)
$(1,928)
$-
$(21,158)
$(19,527)
$(204,537)
Net Cash Flow
$(174,021)
$133,874
$160,145
$136,494
$148,984
$(25,299)
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
52
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
2037
2038
2039
2040
2041
2042
Production & Sales tonnes
2,062
1,960
1,762
2,366
1,804
1,724
Total Revenue
$338,825
$329,205
$302,680
$415,404
$307,404
$305,722
EBITDA
$217,762
$206,113
$179,715
$261,905
$167,920
$166,433
Net Income
$94,184
$107,142
$79,588
$136,843
$92,275
$83,239
Net Cash Provided by Operating Activities
$190,294
$179,925
$156,327
$197,122
$130,469
$131,680
Purchases of Property, Plant, and Equipment
$(178,362)
$(11,413)
$(10,070)
$(18,939)
$(6,627)
$(11,701)
Net Cash Flow
$11,932
$168,512
$146,257
$178,183
$123,842
$119,979
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
2043
2044
2045
2046
2047
2048
Production & Sales tonnes
1,717
1,641
1,719
1,657
1,582
1,704
Total Revenue
$307,825
$296,435
$323,078
$319,329
$311,207
$346,423
EBITDA
$166,345
$155,468
$176,197
$172,276
$164,044
$190,984
Net Income
$97,162
$102,577
$115,995
$111,938
$105,580
$121,920
Net Cash Provided by Operating Activities
$134,459
$126,566
$132,835
$135,759
$130,416
$145,691
Purchases of Property, Plant, and Equipment
$(70,898)
$(32,130)
$(1,608)
$(3,445)
$(20,197)
$(42,226)
Net Cash Flow
$63,561
$94,436
$131,226
$132,313
$110,218
$103,465
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
2049
2050
2051
2052
2053
2054
Production & Sales tonnes
1,656
1,732
1,702
1,596
1,642
1,750
Total Revenue
$341,272
$366,419
$363,743
$344,653
$358,264
$385,655
EBITDA
$185,001
$203,854
$199,083
$181,885
$190,949
$208,272
Net Income
$117,207
$139,379
$136,063
$119,219
$124,332
$139,625
Net Cash Provided by Operating Activities
$148,383
$156,450
$155,343
$145,611
$148,945
$159,944
Purchases of Property, Plant, and Equipment
$(21,985)
$(2,264)
$(17,661)
$(35,030)
$(22,841)
$-
Net Cash Flow
$126,398
$154,185
$137,682
$110,580
$126,104
$159,944
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
2055
2056
2057
2058
2059
2060
Production & Sales tonnes
1,751
2,609
3,576
3,732
3,846
3,762
Total Revenue
$389,797
$586,754
$812,425
$856,469
$891,518
$881,012
EBITDA
$209,937
$293,768
$402,164
$424,215
$445,248
$430,456
Net Income
$159,520
$155,760
$230,828
$240,983
$258,267
$235,432
Net Cash Provided by Operating Activities
$177,985
$239,301
$313,658
$343,495
$359,216
$357,509
Purchases of Property, Plant, and Equipment
$(503,004)
$(81,075)
$(26,163)
$(36,932)
$(20,244)
$(124,371)
Net Cash Flow
$(325,019)
$158,226
$287,495
$306,563
$338,972
$233,138
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
2061
2062
2063
2064
2065
2066
Production & Sales tonnes
3,488
3,390
3,466
3,397
2,961
2,826
Total Revenue
$825,025
$810,082
$836,766
$828,451
$729,294
$703,094
EBITDA
$384,291
$373,425
$383,395
$380,242
$330,841
$317,117
Net Income
$197,731
$249,775
$251,050
$244,672
$199,779
$187,067
Net Cash Provided by Operating Activities
$332,663
$309,606
$303,605
$304,427
$278,545
$263,255
Purchases of Property, Plant, and Equipment
$(48,371)
$(18,997)
$(56,143)
$(55,800)
$(106,035)
$(48,026)
Net Cash Flow
$284,292
$290,609
$247,461
$248,627
$172,510
$215,229
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
2067
2068
2069
2070
2071
2072
Production & Sales tonnes
2,479
2,318
2,289
1,438
1,988
1,993
Total Revenue
$623,079
$588,566
$587,014
$372,607
$520,312
$526,958
EBITDA
$274,027
$245,996
$243,975
$120,878
$208,565
$209,313
Net Income
$157,110
$137,332
$132,150
$60,913
$125,427
$130,499
Net Cash Provided by Operating Activities
$236,473
$211,681
$204,662
$72,113
$144,108
$165,794
Purchases of Property, Plant, and Equipment
$(105,470)
$(32,972)
$(35,968)
$(21,665)
$(40,884)
$(29,483)
Net Cash Flow
$131,003
$178,708
$168,694
$50,448
$103,224
$136,311
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
53
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
2073
2074
2075
2076
2077
2078
Production & Sales tonnes
1,822
2,098
2,055
2,107
1,883
2,129
Total Revenue
$486,489
$513,364
$508,098
$526,120
$474,939
$542,425
EBITDA
$180,965
$192,961
$185,766
$199,986
$169,269
$204,346
Net Income
$110,565
$131,576
$121,087
$124,925
$102,184
$132,803
Net Cash Provided by Operating Activities
$151,740
$149,923
$150,163
$155,728
$139,913
$152,938
Purchases of Property, Plant, and Equipment
$-
$-
$(38,951)
$(73,146)
$(11,367)
$(3,092)
Net Cash Flow
$151,740
$149,923
$111,2 12
$82,582
$128,546
$149,846
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
2079
2080
2081
2082
2083
2084
Production & Sales tonnes
1,937
1,723
2,242
1,568
2,285
1,637
Total Revenue
$498,511
$448,125
$588,782
$416,070
$612,359
$443,292
EBITDA
$172,232
$139,209
$217,859
$113,527
$222,506
$118,656
Net Income
$108,806
$74,410
$128,734
$54,853
$144,403
$63,019
Net Cash Provided by Operating Activities
$140,295
$115,386
$153,758
$109,676
$151,887
$113,810
Purchases of Property, Plant, and Equipment
$(20,499)
$(63,240)
$(32,548)
$(7,363)
$(18,926)
$(35,128)
Net Cash Flow
$119,796
$52,146
$121,210
$102,313
$132,961
$78,682
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
2085
2086
2087
2088
2089
2090
Production & Sales tonnes
1,982
1,477
1,857
1,616
1,993
1,305
Total Revenue
$542,129
$408,032
$518,052
$455,417
$567,535
$375,427
EBITDA
$169,637
$89,713
$145,507
$108,922
$166,892
$55,785
Net Income
$96,625
$31,702
$79,264
$51,566
$96,127
$8,392
Net Cash Provided by Operating Activities
$123,443
$88,067
$104,777
$94,796
$120,752
$66,853
Purchases of Property, Plant, and Equipment
$(35,870)
$(53,613)
$(23,904)
$(32,182)
$-
$(31,114)
Net Cash Flow
$87,573
$34,453
$80,873
$62,614
$120,752
$35,738
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
2091
2092
2093
2094
2095
2096
Production & Sales tonnes
1,637
1,612
1,747
1,355
1,731
1,752
Total Revenue
$475,574
$473,016
$517,712
$405,723
$523,488
$535,336
EBITDA
$103,525
$97,847
$113,758
$40,298
$107,715
$110,329
Net Income
$41,301
$32,537
$52,174
$(4,344)
$49,211
$50,915
Net Cash Provided by Operating Activities
$75,371
$81,436
$89,571
$46,746
$76,088
$90,203
Purchases of Property, Plant, and Equipment
$(71,872)
$(66,089)
$-
$-
$(42,121)
$-
Net Cash Flow
$3,499
$15,347
$89,571
$46,746
$33,967
$90,203
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
YE12/31
2097
2098
2099
2100
2101
2102
Production & Sales tonnes
1,387
916
393
-
-
-
Total Revenue
$428,077
$285,625
$123,638
$-
$-
$-
EBITDA
$46,344
$27,079
$5,340
$-
$-
$-
Net Income
$2,394
$(3,736)
$(11,836)
$-
$-
$-
Net Cash Provided by Operating Activities
$50,190
$27,994
$(197,622)
$-
$-
$-
Purchases of Property, Plant, and Equipment
$-
$-
$-
$-
$-
$-
Net Cash Flow
$50,190
$27,994
$(197,622)
$-
$-
$-
● Financial model includes 0.9 million tonnes of inferred coal production. Inferred coal represents 0.6% of the
total production, and none of this coal was included in the estimate of reserves.
19.3 Sensitivity
Sensitivity of the NPV results to changes in the key drivers is presented in the chart below.
The sensitivity study shows the NPV at the 10.0% discount rate when Base Case sales
prices, operating costs, and capital costs are increased and decreased in increments of 5%
within a +/- 15% range.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
![ex964p63i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p63i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
54
Figure 19-2: Sensitivity of NPV
As shown, NPV is quite sensitive to change in sales price and operating cost estimates, and
slightly sensitive to changes in capital cost estimates.
20
Adjacent Properties
20.1 Information Used
No Proprietary information associated with neighboring properties was used as part of this
study.
21
Other Relevant Data and Information
MM&A performed a previous audit of the Property in 2017 for Coronado based on SEC
Industry Guide 7 standards. MM&A conducted a Joint Ore Reserve Committee (
JORC
)
compliant resource and reserve assessment of the Mon Valley assets effective January 1,
2018. By assignment, the JORC assessment included a preliminary feasibility level study
of the subject coal reserves, encompassing detailed mine planning and cost analysis
through depletion of Mon Valley’s JORC-compliant coal reserves. MM&A utilized this former
preliminary feasibility study as the basis of an updated study which meets those standards
set forth by the JORC Code and SEC.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
55
22
Interpretation and Conclusions
22.1 Conclusion
Sufficient data has been obtained through various exploration and sampling programs and
mining operations to support the geological interpretations of seam structure and thickness
for coal horizons situated on the Property. The data is of sufficient quantity and reliability to
reasonably support the coal resource and coal reserve estimates in this TRS.
The geological data and preliminary feasibility study, which consider mining plans, revenue,
and operating and capital cost estimates are sufficient to support the classification of coal
reserves provided herein.
This geologic evaluation conducted in conjunction with the preliminary feasibility study is
sufficient to conclude that the 134.4 Mt of marketable underground coal reserves identified
on the Property are economically mineable under reasonable expectations of market prices
for metallurgical coal products, estimated operation costs, and capital expenditures.
22.2 Risk Factors
Risks have been identified for operational, technical and administrative subjects addressed
in the Pre-Feasibility Study. A risk matrix has been constructed to present the risk levels for
all the risk factors identified and quantified in the risk assessment process. The risk matrix
and risk assessment process are modeled to that presented in the Australian and New
Zealand Standard on Risk Management (AS/NZS 4360).
The purpose of the characterization of the project risk components is to inform the project
stakeholders of key aspects of the Coronado projects that can be impacted by events whose
consequences can affect the success of the venture. The significance of an impacted
aspect of the operation is directly related to both the probability of occurrence and the
severity of the consequences. The initial risk for a risk factor is herein defined as the risk
level after the potential impact of the risk factor is addressed by competent and prudent
management utilizing control measures readily available. Residual risk for a risk factor is
herein defined as the risk level following application of special mitigation measures if
management determines that the initial risk level is unacceptable. Initial risk and residual
risk can be quantified numerically, derived by the product of values assigned to probability
and consequence ranging from very low risk to very high risk.
The probability and consequence parameters are subjective numerical estimates made by
practiced mine engineers and managers. Both are assigned values from 1 to 5 for which
the value 1 represents the lowest probability and least consequence, and the value 5
represents the highest probability and greatest consequence. The products, which define
the Risk Level, are classified from very low to very high.
Risk Level Table (R = P x C)
Risk Level (R)
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
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&
A
SSOCIATES
,
I
NC
.
56
Very Low (1 to 2)
Low (3 to 5)
Moderate (6 to 11)
High (12 to 19)
Very High (20 to 25)
Risk aspects identified and evaluated during this assignment total 13. No residual risks are
rated Very High. Four (4) residual risks are rated High. Six (6) of the risk aspects could be
associated with Moderate residual risk. Three (3) of the risk aspects were attributed Low or
Very Low residual risks.
22.2.1 Governing Assumptions
The listing of the aspects is not presumed to be exhaustive. Instead that listing is presented
based on the experiences of the contributors to the TRS.
1. The probability and consequence ratings are subjectively assigned, and it is
assumed that this subjectivity reasonably reflects the condition of the active and
projected mine operations.
2. The Control Measures shown in the matrices presented in this chapter are not
exhaustive. They represent a condensed collection of activities that the author of the
risk assessment section has observed to be effective in coal mining scenarios.
3. Mitigation Measures listed for each risk factor of the operation are not exhaustive.
The measures listed, however, have been observed by the author to be effective.
4. The monetary values used in ranking the consequences are generally-accepted
quantities for the coal mining industry.
22.2.2 Limitations
The risk assessment proposed in this report is subject to the limitations of the information
currently collected, tested, and interpreted at the time of the writing of the report.
22.2.3 Methodology
The numerical quantities (i.e., risk levels) attributable to either “initial” or “residual” risks are
derived by the product of values assigned to probability and consequence ranging from very
low risk to very high risk.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
57
R = P x C
Where:
R = Risk Level
P = Probability of Occurrence
C = Consequence of Occurrence
The Probability (P) and Consequence (C) parameters recited in the formula are subjective
numerical estimates made by practiced mine engineers and managers. Both P and C are
assigned integer values ranging from 1 to 5 for which the value 1 represents the lowest
probability and least consequence, and the value 5 represents the highest probability and
greatest consequence. The products (R = P x C) which define the Risk Level, are thereafter
classified from very low to very high.
Risk Level Table
Risk Level (R)
Very Low (1 to 2)
Low (3 to 5)
Moderate (6 to 11)
High (12 to 19)
Very High (20 to 25)
Very high initial risks are considered to be unacceptable and require corrective action well
in advance of project development. In short, measures must be applied to reduce very high
initial risks to a tolerable level.
As shown and discussed above, after taking into account the operational, technical, and
administrative actions that have been applied or are available for action when required, the
residual risk can be determined. The residual risk provides a basis for the management
team to determine if the residual risk level is acceptable or tolerable. If the risk level is
determined to be unacceptable, further actions should be considered to reduce the residual
risk to acceptable or tolerable levels to provide justification for continuation of the proposed
operation.
22.2.4 Development of the Risk Matrix
Risks have been identified for the technical, operational, and administrative subjects
addressed in the TRS. The risk matrix and risk assessment process are modeled to that
presented in the Australian and New Zealand Standard on Risk Management (AS/NZS
4360).
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
58
22.2.4.1 Probability Level Table
Table 22-1: Probability Level Table
Category
Probability Level (P)
1
Remote
Not likely to occur except in exceptional circumstances.
<10%
2
Unlikely
Not likely to occur; small in degree.
10 - 30%
3
Possible
Capable of occurring.
30 - 60%
4
Likely
High chance of occurring in most circumstances.
60 - 90%
5
Almost Certain
Event is expected under most circumstances; impossible to
avoid.
>90%
The lowest rated probability of occurrence is assigned the value of 1 and described as
remote, with a likelihood of occurrence of less than 2 percent. Increasing values are
assigned to each higher probability of occurrence, culminating with the value of 5 assigned
to incidents considered to be almost certain to occur.
22.2.4.2 Consequence Level Table
Table 22-2
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
59
Table 22-2: Consequence Level Table
Correlation of Events in Key Elements of the Project Program to Event Severity Category
Category
Severity of
the Event
Financial
Impact of the
Event
Unplanned
Loss of
Production
(Impact on
Commercial
Operations)
Events Impacting
on the
Environment
Events Affecting the
Program's Social and
Community Relations
Resultant Regulatory /
Sovereign Risk
Events Affecting Occupational Health &
Safety
1
Insignificant
< USD $0.5
million
≤ 12 hours
Insignificant loss of
habitat; no
irreversible effects
on water, soil and
the environment.
Occasional nuisance impact on
travel.
-
Event recurrence avoided by corrective
action through established procedures
(Engineering, guarding, training).
2
Minor
USD $0.5 million
to $2.0 million
≤ 1 day
No significant
change to species
populations; short-
term reversible
perturbation to
ecosystem function.
Persistent nuisance impact on
travel. Transient adverse media
coverage.
-
First aid – lost time.
avoided by corrective action through
established procedures.
3
Moderate
USD $2.0 million
to $10.0 million
≤ 1 week
Appreciable change
to species
population; medium-
term (≤10 years)
detriment to
ecosystem function.
Measurable impact on travel and
water/air quality. Significant
adverse media coverage /
transient public outrage.
Uncertainty securing or
retaining essential
approval / license.
Medical Treatment –
permanent
incapacitation. Avoiding event recurrence
requires modification to established
corrective action procedures
.
Change to regulations
(tax; bonds; standards).
4
Major
USD $10.0
million to $50.0
million
1 to 2 weeks
Change to species
population
threatening viability;
long-term (>10
years) detriment to
ecosystem function.
Long-term, serious impact on
travel and use of water
resources; degradation of air
quality; sustained and effective
public opposition.
Suspension / long-delay
in securing essential
approval / license.
Fatality.
requires modification to established
corrective action procedures and staff
retraining.
Change to laws (tax;
bonds; standards).
5
Critical
>USD $50.0
million
>1 month
Species extinction;
irreversible damage
to ecosystem
function.
Loss of social license.
Withdraw / failure to
secure essential
approval / license.
Multiple fatalities.
Avoiding event
recurrence requires major overhaul of
policies and procedures.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
60
The lowest rated consequence is assigned the value of 1 and is described as Insignificant
Consequence, parameters of which include non-reportable safety incidents with zero days
lost accidents, no environmental damage, loss of production or systems for less than one
week and cost of less than USD $0.5 million. Increasing values are assigned to each higher
consequence, culminating with the value of 5 assigned to critical consequences, the
parameters of which include multiple-fatality accidents, major environmental damage, and
loss of production or systems for longer than one month and cost of greater than USD $50.0
million.
Composite Risk Matrix R = P x C and Color-Code Convention
The risk level, defined as the product of probability of occurrence and consequence, ranges
in value from 1 (lowest possible risk) to 25 (maximum risk level). The values are color-coded
to facilitate identification of the highest risk aspects.
Table 22-3: Risk Matrix
P x C = R
Consequence (C)
Insignificant
Minor
Moderate
Major
Critical
1
2
3
4
5
Probability Level (P)
Remote
1
1
2
3
4
5
Unlikely
2
2
4
6
8
10
Possible
3
3
6
9
12
15
Likely
4
4
8
12
16
20
Almost
Certain
5
5
10
15
20
25
22.2.5 Categorization of Risk Levels and Color Code Convention
Very high risks are considered to be unacceptable and require corrective action. Risk
reduction measures must be applied to reduce very high risks to a tolerable level.
22.2.6 Description of the Coal Property
The Mon Valley Reserve (including Pangburn, Shaner and Fallowfield Areas) is located in
Allegheny, Washington, and Westmoreland Counties, Pennsylvania. Mon Valley
underground operations are projected to commence in 2031 at the Mon Valley Complex in
the large Upper Freeport seam reserve area. Three mines are planned, and each will utilize
continuous mining methods. The initial operation is designated as the Pangburn Mine;
subsequently, the Shaner Mine is projected for 2037 and followed by the Fallowfield Mine
in 2056. The operations are projected to utilize continuous mining production sections. The
method provides continuity, preserving skilled work groups and enabling effective utilization
of production equipment. The Upper Freeport seam is below drainage and therefore all
mines will be accessed with slopes and shafts.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
61
22.2.7 Summary of Residual Risk Ratings
Each risk factor is numbered, and a risk level for each is determined by multiplying the
assigned probability by the assigned consequence. The risk levels are plotted on a risk
matrix to provide a composite view of the Coronado risk profile. The average risk level is
8.4, which is defined as Moderate.
Table 22-4: Risk Assessment Matrix
Consequence
Critical
>$50 MM
9, 10
Major
$10-50MM
4
1, 2, 3
6
Moderate
$2-10 MM
12
Minor
$0.5-$2 MM
7, 13
5
8
Low
<$0.5 MM
11
<10%
10-30%
30-60%
60-90%
>90%
Remote
Unlikely
Possible
Likely
Almost
Certain
22.2.8 Risk Factors
A high-level approach is utilized to characterize risk factors that are generally similar across
a number of the active and proposed mining operations. Risk factors that are unique to a
specific operation or are particularly noteworthy are addressed individually.
22.2.8.1 Geological and Coal Resource
Coal mining is accompanied by risk that, despite exploration efforts, mining areas will be
encountered where geological conditions render extraction of the resource to be
uneconomic, or that coal quality characteristics disqualify the product for sale into target
markets.
To illustrate these points, the Upper Freeport coal seam deposits at Mon Valley are
examined. The coal is deposited in large, elliptical pods. During deposition, the raised peat
deposits were surrounded by areas void of peat and deposited instead with dirt, clay, and
stream channels. Consequently, the perimeter of the peat, and consequent coal deposits
may contain significantly higher concentration of ash and sulfur, and reduced product yield.
The perimeter deposits may also be affected by immediate roof and floor conditions that
adversely affect mining cost and productivity. Meandering sandstone channels may reduce
coal seam thickness by scouring action at the top of the coal seam and support the migration
of sulfur to the Upper Freeport seam.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
62
Offsetting the geological and coal resource risk are the massive size of the controlled
property which allows large areas to be mined in the three designated mine areas sufficiently
away from areas where coal quality and mineability are less favorable. In addition, the mines
are designed to operate with multiple production sections, which lessens the immediate
impact when one section encounters difficulties. The large reserve areas also provide a
mitigation strategy of developing an additional (spare) section at each mine which can be
activated when adverse conditions are encountered, thereby maintaining consistent
production and quality. The spare section requires additional mine extension cost but
increases flexibility and performance consistency.
Table 22-5: Geological and Coal Resource Risk Assessment (Risks 1 and 2)
Aspect
Impact
Control Measures
Initial Risk Level
Mitigation
Measures
Residual Risk Level
P
C
R
P
C
R
Recoverable coal
tonnes recognized to
be significantly less
than previously
estimated.
Reserve base is
adequate to serve
market commitments
and respond to
opportunities for many
years. Local adverse
conditions may increase
frequency and cost of
production unit
relocations.
Previous and ongoing
exploration and
extensive regional
mining history provide
a high level of
confidence of coal
seam correlation,
continuity of the coal
seams, and coal
resource tonnes.
4
4
16
Optimize mine
plan to increase
resource
recovery;
develop mine
plan to provide
readily available
alternate mining
locations to
sustain expected
production level.
3
4
12
Coal quality locally
proves to be lower
than initially
projected.
If uncontrolled,
production and sale of
coal that is out of
specification can result in
rejection of deliveries,
cancellation of coal sales
agreements and damage
to reputation.
Exploration and vast
experience and history
in local coal seams
provide confidence in
coal quality; limited
excursions can be
managed with careful
product segregation
and blending.
3
5
15
Develop mine
plan to provide
readily available
alternate mining
locations to
sustain expected
production level;
modify coal
sales
agreements to
reflect coal
quality.
3
4
12
22.2.8.2 Environmental
Water quality and other permit requirements are subject to modification and such changes
could have a material impact on the capability of the operator to meet modified standards or
to receive new permits and modifications to existing permits. Permit protests may result in
delays or denials to permit applications.
Environmental standards and permit requirements have evolved significantly over the past
50 years and to-date, mining operators and regulatory bodies have been able to adapt
successfully to evolving environmental requirements.
The Residual Risk has is projected to be slightly higher for the PA reserves due to the
proximity of the rivers and the residual environmental complaints, in the vicinity, left from
mining in the past.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
M
ARSHALL
M
ILLER
&
A
SSOCIATES
,
I
NC
.
63
Table 22-6: Environmental (Risks 3 and 4)
Aspect
Impact
Control Measures
Initial Risk Level
Mitigation
Measures
Residual Risk
Level
P
C
R
P
C
R
Environmental
performance
standards are
modified in the
future.
Delays in receiving new
permits and modifications
to existing permits; cost
of testing and treatment
of water and soils
Work with regulatory
agencies to
understand and
influence final
standards; implement
testing, treatment and
other actions to
comply with new
standards.
3
4
12
Modify mining
and reclamation
plans to improve
compliance with
new standards
while reducing
cost of
compliance.
3
4
12
New permits and
permit modifications
are increasingly
delayed or denied.
Interruption of production
and delayed
implementation of
replacement production
from new mines.
Comply quickly with
testing, treatment and
other actions required;
continue excellent
compliance
performance within
existing permits.
2
4
8
Establish and
maintain close
and constructive
working
relationships with
regulatory
agencies, local
communities and
community
action groups.
2
4
8
22.2.8.3 Regulatory Requirements
Federal and state health and safety regulatory agencies occasionally amend mine laws and
regulations. The impact is industry-wide. Mining operators and regulatory agencies have
been able to adapt successfully to evolving health and safety requirements.
Table 22-7: Regulatory Requirements (Risk 5)
Aspect
Impact
Control Measures
Initial Risk Level
Mitigation
Measures
Residual Risk
Level
P
C
R
P
C
R
Federal and state
mine safety and
health regulatory
agencies amend
mine laws and
regulations.
Cost of training,
materials, supplies and
equipment; modification
of mine examination and
production procedures;
modification of mining
plans.
Participate in hearings
and workshops when
possible to facilitate
understanding and
implementation; work
cooperatively with
agencies and
employees to facilitate
implementation of new
laws and regulations.
4
3
12
Familiarity and
experience with
new laws and
regulations
results in
reduced impact
to operations and
productivity and
improved
supplies and
equipment
options.
4
2
8
22.2.8.4 Market and Transportation
Most of the current and future production is expected to be directed to domestic and
international metallurgical markets. Historically the metallurgical markets have been cyclical
and highly volatile.
The Mon Valley business plan assumes that 75 percent of production can be sold into the
favorably priced metallurgical market. The mining plan must minimize exposure to the
perimeter reserves where quality may not be suitable for the market plan and be flexible to
manage exposure to areas where coal quality fails to meet metallurgical standards.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
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Table 22-8: Market and Transportation (Risks 6 and 7)
Aspect
Impact
Control Measures
Initial Risk Level
Mitigation
Measures
Residual Risk
Level
P
C
R
P
C
R
Volatile coal prices
drop precipitously.
Loss of revenue
adversely affects
profitability; reduced
cash flow may disrupt
capital expenditures
plan.
Cost control measures
implemented; capital
spending deferred.
4
5
20
High-cost
operations
closed, and
employees
temporarily
furloughed.
4
4
16
Coal quality at Mon
Valley Upper
Freeport mines is
not adequate to
support 100 percent
metallurgical sales.
Reduced revenue from a
percentage of thermal
sales jeopardizes
financial performance
and expectations.
Lower preparation
plant gravities for ash
and sulfur reduction;
segregate lower
quality coal when
possible and manage
shipped quality by
blending.
3
5
15
Adjust mine
plan to keep
minimize
exposure to
perimeter coal
and sandstone
channels;
provide spare
section to
sustain
production and
quality when low
quality areas are
encountered.
3
2
6
Occasional delay or interruption of rail, river and terminals service may be expected. The
operator can possibly minimize the impact of delays by being a preferred customer by
fulfilling shipment obligations promptly and maintaining close working relationships.
Table 22-9: Market and Transportation (Risk 8)
Aspect
Impact
Control Measures
Initial Risk Level
Mitigation
Measures
Residual Risk
Level
P
C
R
P
C
R
Rail or river transport
is delayed; storage
and shipping access
at river and ocean
terminals is not
available.
Fulfillment of coal sales
agreements delayed;
limited coal storage at
mines may increase cost
of rehandling; production
may be temporarily idled.
Provide adequate
storage capacity at
mines; coordinate
continuously with
railroad and shipping
companies to respond
quickly and effectively
to changing
circumstances.
5
3
15
Provide back-up
storage facility
along with
personnel,
equipment and
rehandle plan to
sustain
production and
fulfill sales
obligations
timely.
5
2
10
22.2.8.5 Mining Plan
Occupational health and safety risks are inherent in mining operations. Comprehensive
training and retraining programs, internal safety audits and examinations, regular mine
inspections, safety meetings, along with support of trained fire brigades and mine rescue
teams are among activities that greatly reduce accident risks. Employee health monitoring
programs coupled with dust and noise monitoring and abatement reduce health risks to
miners.
As underground mines are developed and extended, observation of geological,
hydrogeological and geotechnical conditions lead to modification of mine plans and
procedures to enable safe work within the mine environments.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
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Highlighted below are selected examples of safety and external factors relevant to Coronado
operations.
22.2.8.5.1 Methane Management
Coalbed methane is present in coal operations below drainage. Often the methane
concentration is at such low levels that it can be readily managed with frequent testing and
monitoring, vigilance, and routine mine ventilation. Very high methane concentrations may
be present at greater depths. High methane concentrations may require degasification of
the coal seam to assure safe mining.
Table 22-10: Methane Management (Risk 9)
Aspect
Impact
Control Measures
Initial Risk Level
Mitigation
Measures
Residual Risk
Level
P
C
R
P
C
R
Methane hazard is
present in mines
operating below
drainage.
Injury or loss of life;
possible ignition of gas
and mine explosion;
potential loss of mine and
equipment temporarily or
permanently; additional
mine fan, mine power,
ventilation, monitoring
and examination
requirements.
Low to moderate levels
can be managed with
frequent examinations,
testing and monitoring
within the mine
ventilation system.
Excellent rock dust
maintenance
minimizes explosion
propagation risk should
an ignition occur.
1
5
5
Very high-level
methane
concentrations
may require coal
seam
degasification
and gob
degasification if
longwall or pillar
extraction
methods are
employed.
1
5
5
22.2.8.5.2 Mine Fires
Mine fires, once common at mine operations, are rare today. Most active coal miners have
not encountered a mine fire. Vastly improved mine power and equipment electrical systems,
along with safe mine practices reduce mine fire risks. Crew training and fire brigade support
and training improve response for containment and control if a fire occurs. Spontaneous
combustion within coal mines, which is the source of most fires that occur today, is not
expected to commonly occur at the Coronado property. When spontaneous combustion
conditions are present, monitoring systems are employed for early detection and mine plans
are designed to facilitate isolation, containment and rapid extinguishment.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
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Table 22-11 : Mine Fires (Risk 10)
Aspect
Impact
Control Measures
Initial Risk Level
Mitigation
Measures
Residual Risk
Level
P
C
R
P
C
R
Mine fire at
underground or
surface mine
operation.
Injury or loss of life;
potential loss of mine
temporarily or
permanently; damage to
equipment and mine
infrastructure.
Inspection and
maintenance of mine
power, equipment and
mine infrastructure;
good housekeeping;
frequent examination
of conveyor belt
entries; prompt
removal of
accumulations of
combustible materials.
1
5
5
If spontaneous
combustion
conditions are
present,
enhanced
monitoring and
examination
procedures will
be implemented;
mine design will
incorporate
features to
facilitate
isolation,
containment and
extinguishment
of spontaneous
combustion
locations.
1
5
5
22.2.8.5.3 Availability of Supplies and Equipment
The industry has periodically experienced difficulty receiving timely delivery of mine supplies
and equipment. Availability issues often accompanied boom periods for coal demand. Any
future delivery of supplies and equipment delays are expected to be temporary with limited
impact on production.
Table 22-12: Availability of Supplies and Equipment (Risk 11)
Aspect
Impact
Control Measures
Initial Risk Level
Mitigation
Measures
Residual Risk
Level
P
C
R
P
C
R
Disruption of
availability for
supplies and
equipment.
Temporary interruption
of production.
Force majeure
provision in coal sales
agreements to limit
liability for delayed or
lost sales.
3
2
6
Work closely
with customers
to assure
delayed coal
delivery rather
than cancelled
sales; monitor
external
conditions and
increase
inventory of
critical supplies;
accelerate
delivery of
equipment when
possible.
3
1
3
22.2.8.5.4 Labor
Work stoppage due to labor protests are considered to be unlikely and accompanied by
limited impact should it occur. Excellent employee relations and communications limit the
exposure to outside protesters. Loss of supervisors and skilled employees to retirement is
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
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inevitable; the impact can be lessened with succession planning, training, and mentorship
of new employees.
These will be new mines in an historically United Mine Workers of America (
UMWA
)
represented area. Newer mines in the area are not represented so the precedent has been
set. However, the Residual risk is shown as slightly elevated over some other Coronado
properties.
Table 22-13: Labor – Work Stoppage (Risk 12)
Aspect
Impact
Control Measures
Initial Risk Level
Mitigation
Measures
Residual Risk
Level
P
C
R
P
C
R
Work stoppage due
to strikes, slowdowns
or secondary boycott
activity.
Loss of production and
coal sales; damaged
customer and employee
relations; reputation loss.
Maintain excellent
employee relations
and communications;
maintain frequent
customer
communications.
2
3
6
Develop plan for
employee
communications
and legal support
to minimize
impact of
secondary
boycott activities.
2
3
6
Table 22-14: Labor – Retirement (Risk 13)
Aspect
Impact
Control Measures
Initial Risk Level
Mitigation
Measures
Residual Risk
Level
P
C
R
P
C
R
Retirement of
supervisors and
skilled employees.
Loss of leadership and
critical skills to sustain
high levels of safety,
maintenance and
productivity.
Monitor demographics
closely and maintain
communications with
employees who are
approaching
retirement age;
maintain employee
selection and training
programs.
3
3
9
Maintain
selection of
candidates and
implementation
of in-house or
third-party
training for
electricians and
mechanics;
develop
employee
mentoring
program.
3
2
6
23
Recommendations
Coronado is continuing to work both internally and with outside assistance to continue to
further define their Resource Base and to Optimize the LOM Plan.
24
References
Publicly available information from various State and Federal agencies was used where
relevant.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Coronado Global Resources Inc.
Statement of Coal Resources and Reserves for the
Mon Valley Complex Upper Freeport Holdings
in Accordance with the JORC Code and
United States SEC Regulation S-K 1300 as of December 31, 2021
Northern Appalachian Coal Basin
Pennsylvania, USA
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25
Reliance on Information Provided by the
Registrant
For the purpose of this TRS, MM&A utilized the Geological data provided by Coronado. This
information was subjected to verification of its integrity and completeness.
Historical productivity and operating costs were also supplied by Coronado. This
information was combined with the experience and knowledge of the QPs to forecast the
LOM plan.
A summary of the information provided by Coronado relied upon by MM&A for the purposes
of this TRS is provided in
Table 25-1
.
Table 25-1: Information from Registrant Relied Upon by MM&A
Information Provided by Coronado
Report
Section
Legal
Mineral control and surface control rights as shown on maps
3.2, 3.3
Geological
Geologic data including digital databases and original source data
including geologist logs, driller’s logs, geophysical logs
9.1
Coal Quality
Database of coal quality information supplemented with original
source laboratory sheets where available
10.1
Mining
Historical productivities and manpower from operating and future
Coronado mines
13.2, 13.4
Coal Preparation
Flow sheet and other information representing current and future
methods of coal processing
14.1
Marketing
Long-term price forecast and market placement by seam or mine
used in financial projections
16.2
Waste Disposal
Engineering data and estimates representing remaining capacities
for coarse and fine coal waste disposal
17.2
Environmental
Permit and bonding information
17.3
Costs
Historical and budgetary operating cost information used to derive
cost drivers for reserve financial modeling
18.2
Economic
WACC and inflation rate used in discounted cash flow analysis
19.1, 19.2,
19.3
![ex964p78i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p78i0.jpg)
APPENDIX
A
BIOGRAPHIES
![ex964p79i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p79i0.jpg)
![ex964p80i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p80i0.jpg)
![ex964p81i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p81i0.jpg)
APPENDIX
B
MAPS
![ex964p82i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p82i0.jpg)
![ex964p83i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p83i0.jpg)
![ex964p84i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p84i0.jpg)
![ex964p85i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p85i0.jpg)
APPENDIX
C
GLOSSARY OF TERMS
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Glossary of Abbreviations and Definitions
Abbreviation
Definition
AIPG
American Institute of Professional Geologists
ARMPS
Analysis of Retreat Mining Pillar Stability
ASTM
American Society for Testing and Materials
AVS
Applicant Violator System
bcm
Bank cubic meters
Btu/lb.
British Thermal Unit per pound
CAT
®
Caterpillar Inc.
C.P.G .
Certified Professional Geologist
Carlson
Carlson Mining – formerly SurvCADD
®
used for modeling in the Appalachian region
CFR
Code of Federal Regulations
Coronado
Coronado Global Resources Inc.
CSR
Codes of State Rules
CSX
CSX Corporation, a rail-based freight transportation company
CTR
Contour mining
Demonstrated
reserves
Demonstrated reserves are the sum of proven and probable reserves.
DEP
Department of Environmental Protection
EBITDA
Earnings before Interest, Taxes, Depreciation, and Amortization
EOM
End-of-mine reclamation
EPA
United States Environmental Protection Agency
ESA
Limited Phase I Environmental Site Assessment
EVR
Estimated Visual Recovery
Feasibility Study
“…comprehensive technical and economic study of the selected
development option for a mineral project, which includes detailed
assessments of all applicable modifying factors together with any other
relevant operational factors, and detailed financial analysis that are
necessary to demonstrate, at the time of reporting, that extraction is
economically viable. According to the proposed definition, the results of
the study may serve as the basis for a final decision by a proponent or
financial institution to proceed with, or finance, the development of the
project. Thus, a feasibility study is more comprehensive, with a higher
degree of accuracy, and yielding results with a higher level of
confidence, than a pre-feasibility study.”
Hitachi
Hitachi Construction Machinery Co., Ltd.
HWM
Highwall mining
In situ
Its natural position; said specific of a rock, soil, or fossil when in the
situation in which was originally formed or deposited
Indicated
Resources
Indicated resources are those lying between 0.4-kilometer and 1.2-
kilometer radius from such an observation point and reported herein as
in-situ mineral resources.
Inferred
Resources
Inferred resources lie more than a 1.2-kilometer radius from a valid point
of measurement but less than 4.8 kilometers from one and reported
herein as in-situ mineral resources.
JORC Code
Australasian Code for Reporting of Exploration Results, Mineral
Resources and Ore Reserves
lb. SO
2
Pounds per sulfur dioxide per million British thermal units
LJ Hughes
LJ Hughes & Sons, Inc. - drilling Company
LOM
Life-of-mine
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Abbreviation
Definition
M&R
Maintenance and repair
M.B.A.
Master of Business Administration
Measured
Resources
Measured resources are those lying within 0.4-kilometer radius from a
valid point of measurement and reported herein as in-situ mineral
resources.
MINER Act
Mine Improvement and New Emergency Response Act of 2006
Mineral Reserve
“…the economically mineable part of a Measured and/or Indicated
Mineral Resource. It includes dilution materials and allowances for
losses, which occur when the material is mined or extracted and is
defined by studies at Preliminary Feasibility or Feasibility level as
appropriate that include Modifying Factors. Such studies demonstrate
that, at the time of reporting, extraction of the mineral reserve is
economically viable under reasonable investment and marketing
assumptions.”
Mineral Resource
“…a concentration or occurrence of solid material of economic interest
or on the Earth’s crust in such form, grade or quality that there are
reasonable prospects for eventual economic extraction. The location,
quantity, grade, continuity and other geological characteristics and
continuity of a Mineral Resource are known, estimated or interpreted
from specific geological evidence and knowledge, including sampling.”
MM&A
Marshall Miller & Associates, Inc.
Modifying Factors
“…considerations used to convert Mineral Resources to Mineral
Reserves. These include, but are not restricted to, mining, processing,
metallurgical, infrastructure, economic, marketing, legal, environmental
compliance, plans, negotiations, or agreements with local individuals or
groups and governmental factors.”
MRMR
Mineral Resources to Mineral Reserves
MSHA
United States Department of Labor Mine Safety and Health
Administration
MSL
Mean sea level
Mt
Million metric tonnes
NAIP
National Agricultural Imagery Program
NIOSH
National Institute for Occupational Safety and Health
NS
Norfolk Southern Corporation, a rail-based freight transportation
company
O&M
Operating and maintenance
OSD
Out-of-seam dilution
OSM
U.S. Office of Surface Mining Reclamation and Enforcement
P&L
Profit and loss before tax
P.E.
Professional Engineer
Preliminary
Feasibility Study
“…as a comprehensive study of a range of options for the technical and
economic viability of a mineral project that has advanced to a stage
where a qualified person has determined (in the case of underground
mining) a preferred mining method, or in the case of surface mining) a
pit configuration, and in all cases has determined an effective method of
mineral processing and an effective plan to sell the product. The study’s
financial analysis must have the level of detail necessary to
demonstrate, at the time of reporting, that extraction is economically
viable. In addition, as noted in the proposed definition of a pre-feasibility
study, while a pre-feasibility study is less comprehensive and results in
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Abbreviation
Definition
a lower confidence level than a feasibility study, a pre- feasibility study
is more comprehensive and results in a higher confidence level than an
initial assessment.”
Property(ies)
Bituminous coal deposits located in southwestern Pennsylvania. The
Pennsylvania properties include the combined Pangburg, Shaner, and
Fallowfield underground mines in the Upper Freeport seam.
QP
Qualified Person
Qualified Person
“…a person who is a mineral industry professional with at least five
years of relevant experience in the type of mineralization and type of
deposit under consideration and in the specific type of activity that
person is undertaking on behalf of the registrant. In addition, the
proposed definition requires a qualified person to be an eligible member
or licensee in good standing of a recognized professional organization
at the
time the technical report is prepared.”
Rec.
Recovery
RECs
Recognized Environmental Conditions
Resource
Database
The Resource Database is established by the collection, validation,
recording, storing and processing of data and forms the foundation
necessary for the estimation of Mineral Resource and Mineral Reserve.
A quality assurance and quality control program is essential and must
be established to govern the collection of all data. In reporting, a
Mineral Resource must meet the minimum requirement of “reasonable
prospects for economic extraction”. This will require the concurrent
collection and storage of preliminary economic, mining, metallurgical,
environmental, legal and social data and other information for use in the
estimation of MRMR.
The Resource Database will include both “primary” (observation and
measurement) and “interpreted” data. It is recommended that data be
stored digitally, using a documented, standard format and a reliable
storage medium that allows for easy and complete retrieval of the data.
ROM
Run-of-mine
RPO
Recognized Professional Organizations
S-K 1300
United States Securities and Exchange Commission Regulation S-K
1300 Modernization of Property Disclosures
SEC
U.S. Securities and Exchange Commission
SME
Society for Mining Engineers
SMCRA
Surface Mining Control and Reclamation Act of 1977 is the primary
federal law that regulates the environmental effects of coal mining in the
United States.
Strip Ratio
Represented by bcm of overburden to recoverable coal tonnes
tph
tonnes per hour
TRS
Technical Report Summary
USA
United States of America
USGS
United States Geologic Survey
VALMIN Code
Australasian Code for Public Reporting of Technical Assessments and
Valuations of Mineral Assets
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Abbreviation
Definition
Vulcan™
Vulcan™ software is a product of Maptek™, a provider of software for
the global mining industry.
![ex964p90i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p90i0.jpg)
APPENDIX
D
JORC TABLE 1
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Statement of Coal Resources and Reserves
in Accordance with SEC and the JORC Code as of December 31, 2021
Northern and Central Appalachian Coal Basins –
Virginia, West Virginia and Pennsylvania, USA
Appendix D: JORC Table 1
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Section 1 Sampling Techniques and Data
Criteria
JORC Code explanation
Commentary
Sampling
techniques
>
Nature and quality of sampling (e.g. cut channels, random chips, or specific
specialised industry standard measurement tools appropriate to the minerals
under investigation, such as downhole gamma sondes, or handheld XRF
instruments, etc.). These examples should not be taken as limiting the broad
meaning of sampling.
>
Include reference to measures taken to ensure sample representivity and the
appropriate calibration of any measurement tools or systems used.
>
Aspects of the determination of mineralisation that are Material to the Public
Report. In cases where ‘industry standard’ work has been done this would be
relatively simple (e.g. ‘reverse circulation drilling was used to obtain 1 m
samples from which 3 kg was pulverised to produce a 30 g charge for fire
assay’). In other cases, more explanation may be required, such as where
there is coarse gold that has inherent sampling problems. Unusual
commodities or mineralisation types (e.g. submarine nodules) may warrant
disclosure of detailed information.
> Most of the coal samples have been obtained from the Properties by subsurface
exploration using core drilling techniques. The protocol for preparing and testing
the samples has varied over time and is not well documented for the older holes
drilled on the Properties.
> Typical USA core drilling sampling technique is for the coal core sample, once
recovered from the core barrel, to be described then wrapped in a sealed plastic
sleeve and placed into a covered core box, which is the length of the sample so
that the core can be delivered to a laboratory in relatively intact condition and with
original moisture content.
> It is reasonable to assume, given the sophistication level of the previous operators,
that these samples were generally collected and processed under industry best-
practices. This assumption is based on MM&A’s familiarity with the operating
companies and the companies used to perform the analysis.
> Some of the drill holes were air rotary bored and no coal core samples were
collected. Seam thickness for rotary-drilled bore holes is verified by calibrated
downhole gamma-density logs.
> Coal samples that were deemed by MM&A geologists to be unrepresentative were
not used for statistical analysis of coal quality, as documented in the tabulations. A
representative group of drill hole samples from the Properties were then checked
against the original drill laboratory reports to verify accuracy and correctness.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Statement of Coal Resources and Reserves
in Accordance with SEC and the JORC Code as of December 31, 2021
Northern and Central Appalachian Coal Basins –
Virginia, West Virginia and Pennsylvania, USA
Appendix D: JORC Table 1
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Criteria
JORC Code explanation
Commentary
Drilling
techniques
>
Drill type (e.g. core, reverse circulation, open-hole hammer, rotary air blast,
auger, Bangka, sonic, etc.) and details (e.g. core diameter, triple or standard
tube, depth of diamond tails, face-sampling bit or other type, whether core is
oriented and if so, by what method, etc.).
> The Properties have been extensively explored by subsurface drilling efforts carried
out by numerous entities, most of which were completed prior to acquisition by
Coronado. The majority of the drilling was accomplished using vertical continuous
(diamond) coring or air rotary methods.
> Core drilling methods utilize NX-size (5.4 centimeter) or similar-sized core cylinders
to recover core samples, which can be used to delineate geologic characteristics,
and for coal quality testing and geotechnical logging.
> Data for the rotary drilled holes is mainly derived from downhole geophysical logs,
which are used to interpret coal and rock thickness and depth since logging of the
drill cuttings is not reliable.
> Geophysical logging was performed on many of the holes, either by Geological
Logging Systems (a division of MM&A), other geophysical logging contractors, and
on those properties acquired from CONSOL geophysical logging was often
performed by CONSOL’s in-house logging services.
Drill sample
recovery
> Method of recording and assessing core and chip sample recoveries and
results assessed.
> Measures taken to maximise sample recovery and ensure representative
nature of the samples.
> Whether a relationship exists between sample recovery and grade and
whether sample bias may have occurred due to preferential loss/gain of
fine/coarse material.
> Where available, core recovery thickness of coal samples was reconciled with the
thickness interpreted from geophysical logs.
> Core recovery of the older coal samples lacking geophysical logs is sometimes not
well-documented: however, when the laboratory results for such holes had
anomalous values, the data was disqualified and not used.
Logging
> Whether core and chip samples have been geologically and geotechnically
logged to a level of detail to support appropriate Mineral Resource estimation,
mining studies and metallurgical studies.
> Whether logging is qualitative or quantitative in nature. Core (or costean,
channel, etc.) photography.
> The total length and percentage of the relevant intersections logged.
> A wide variety of core-logging techniques exist for the properties. For many of the
core holes, the primary data source is a generalized lithology description by the
driller, in some cases supplemented by a more detailed core log completed by a
geologist.
> The logging of core thickness and depth is quantitative. With the exception of the
coal seams, logging of rock strata type is more subjective and best considered as
qualitative.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Statement of Coal Resources and Reserves
in Accordance with SEC and the JORC Code as of December 31, 2021
Northern and Central Appalachian Coal Basins –
Virginia, West Virginia and Pennsylvania, USA
Appendix D: JORC Table 1
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Criteria
JORC Code explanation
Commentary
Sub-sampling
techniques and
sample
preparation
> If core, whether cut or sawn and whether quarter, half or all core taken.
> If non-core, whether riffled, tube sampled, rotary split, etc. and whether
sampled wet or dry.
> For all sample types, the nature, quality and appropriateness of the sample
preparation technique.
> Quality control procedures adopted for all sub-sampling stages to maximise
representivity of samples.
> Measures taken to ensure that the sampling is representative of the in situ
material collected, including for instance results for field duplicate/second-half
sampling.
> Whether sample sizes are appropriate to the grain size of the material being
sampled.
> Typical US practice in the Appalachian Basin is that core samples for deep
mineable core samples are not sawn or subsampled (since seams are not of great
thickness and the entire seam is mined and co-mingled).
> Oftentimes, core for surface-mineable coal seams are bench sampled separately
by the various coal and rock layers (plies).
> MM&A has exercised diligence to use only those analyses that are representative
of the coal quality parameters for the appropriate mining type for each sample.
Quality of assay
data and
laboratory tests
> The nature, quality and appropriateness of the assaying and laboratory
procedures used and whether the technique is considered partial or total.
> For geophysical tools, spectrometers, handheld XRF instruments, etc., the
parameters used in determining the analysis including instrument make and
model, reading times, calibrations factors applied and their derivation, etc.
> Nature of quality control procedures adopted (e.g. standards, blanks,
duplicates, external laboratory checks) and whether acceptable levels of
accuracy (i.e. lack of bias) and precision have been established.
> Sample analysis was typically carried out by accredited US laboratories.
> Standard procedure upon receipt of core samples by the testing laboratory is to log
the depth and thickness of the sample, then perform testing as specified by a
representative of the operating company. Each sample is then analyzed in
accordance with procedures defined under
American Society for Testing and
Materials (
ASTM
)
D4371); ash (ASTM D3174); sulfur (ASTM D4239); Btu/lb. (ASTM D5865); volatile
matter (ASTM D3175); Free Swell Index (
FSI
) (ASTM D720).
> Geophysical tools are calibrated by the logging company and where possible,
validated using a calibration hole.
Verification of
sampling and
assaying
> The verification of significant intersections by either independent or alternative
company personnel.
> The use of twinned holes.
> Documentation of primary data, data entry procedures, data verification, data
storage (physical and electronic) protocols.
> Discuss any adjustment to assay data.
> All coal intersection data used to generate the geologic model has been cross
referenced with the lithological and geophysical logs by MM&A.
> Laboratory quality was adjusted from dry basis to reflect the anticipated marketable
product moisture.
> Coal quality results were verified by spot-check with laboratory analysis sheets by
MM&A before inclusion into the geologic model and use in the resource estimate.
Location of data
points
> Accuracy and quality of surveys used to locate drill holes (collar and down-
hole surveys), trenches, mine workings and other locations used in Mineral
Resource estimation.
> Specification of the grid system used.
> Quality and adequacy of topographic control.
> Due to the long history of exploration by various parties on the Properties, a wide
variety of survey techniques exist for documentation of data point locations. Many
of the older exploration drill holes appear to have been located by ground survey;
more recently completed drill holes are often located by high-resolution Global
Positioning System (
GPS
) units.
> Grid systems used are typically the State Plane Coordinate System pertinent to
each property.
> Topography is based on either the USGS topographic 7.5-minute quadrangle maps
or on recent aerial photogrammetry as necessary (subject to availability).
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Statement of Coal Resources and Reserves
in Accordance with SEC and the JORC Code as of December 31, 2021
Northern and Central Appalachian Coal Basins –
Virginia, West Virginia and Pennsylvania, USA
Appendix D: JORC Table 1
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Criteria
JORC Code explanation
Commentary
Data spacing and
distribution
> Data spacing for reporting of Exploration Results.
>
Whether the data spacing and distribution is sufficient to establish the
degree of geological and grade continuity appropriate for the Mineral
Resource and Ore Reserve estimation procedure(s) and classifications
applied.
> Whether sample compositing has been applied.
> Spacing and distribution of data point information may vary from seam to seam
within each mining area. The areas estimated for coal resource and coal reserve
tonnes have been limited so that the data spacing and distribution is sufficient to
establish the degree of geological continuity appropriate for the estimation and
classification of the coal tonnes.
> All of the coal resource tonnes are in the measured, indicated, and inferred
categories, and all of the coal reserve tonnes are in the proved and probable
categories in accordance with the JORC Code and SEC standards.
Orientation of
data in relation to
geological
structure
> Whether the orientation of sampling achieves unbiased sampling of possible
structures and the extent to which this is known, considering the deposit type.
> If the relationship between the drilling orientation and the orientation of key
mineralised structures is considered to have introduced a sampling bias, this
should be assessed and reported if material.
> Drill holes have been vertically drilled. No downhole deviation logs have been
collected and it is therefore not known if the drill holes have deviated away from
vertical. Based on the relatively shallow seam depths, any deviation is expected to
be insignificant and immaterial to the geologic characterization of the property.
> The dip of the coal seams is relatively minor and not a material issue for
representation of seam thickness or quality.
Sample security
The measures taken to ensure sample security.
> Sample handling procedures employed by explorationists follow typical US protocol
and should be adequate to insure sample security.
Audits or reviews
The results of any audits or reviews of sampling techniques and data.
> MM&A has reviewed all available geological information for the Properties in
developing the geologic model. Only that data deemed suitable has been used for
the purpose of generating the resource and reserve estimates.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Statement of Coal Resources and Reserves
in Accordance with SEC and the JORC Code as of December 31, 2021
Northern and Central Appalachian Coal Basins –
Virginia, West Virginia and Pennsylvania, USA
Appendix D: JORC Table 1
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Section 2 Reporting of Exploration Results
Criteria
JORC Code explanation
Commentary
Mineral tenement
and land tenure
status
> Type, reference name/number, location and ownership including agreements
or material issues with third parties such as joint ventures, partnerships,
overriding royalties, native title interests, historical sites, wilderness or national
park and environmental settings.
> The security of the tenure held at the time of reporting along with any known
impediments to obtaining a licence to operate in the area.
> The Coronado coal resources are located within three of the United State of
America: Virginia; West Virginia; and Pennsylvania. Control of these Properties is
governed by many hundreds of agreements.
> MM&A has not carried out separate title verification for the coal properties and has
not verified leases, deeds, surveys or other property control instruments pertinent
to the subject resources.
> Coronado has represented to MM&A that it controls the mining rights to the coal
deposits as shown on its property maps, and MM&A has accepted these as being
a true and accurate depiction of the mineral rights controlled by Coronado. The
TRS assumes the properties are developed under responsible and experienced
management.
> There are no known legal or environmental encumbrances that would impede
development of the subject coal reserves.
Exploration done
by other parties
> Acknowledgment and appraisal of exploration by other parties.
> The Properties have been extensively explored by subsurface drilling efforts
carried out by numerous entities, most of which were completed prior to acquisition
by Coronado.
> This exploration work was generally performed to prevailing US best practice
standards and deemed adequate for the purposes of this TRS.
Geology
> Deposit type, geological setting and style of mineralisation.
> The Coronado coal resources are located within the Northern and Central
Appalachian Coal Basins.
> The coal deposits are Carboniferous in age, being of the Pennsylvanian system.
> Seam of economic significance typically range between 0.3 meters and 1.8 meters
in thickness, with relatively little structural deformation.
> Regional structure is typically characterized by gently dipping strata to the
northwest at less than one percent.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Statement of Coal Resources and Reserves
in Accordance with SEC and the JORC Code as of December 31, 2021
Northern and Central Appalachian Coal Basins –
Virginia, West Virginia and Pennsylvania, USA
Appendix D: JORC Table 1
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Criteria
JORC Code explanation
Commentary
Drill hole
Information
> A summary of all information material to the understanding of the exploration
results including a tabulation of the following information for all Material drill
holes:
● easting and northing of the drill hole collar
● elevation or RL (Reduced Level – elevation above sea level in metres) of
the drill hole collar
● dip and azimuth of the hole
● down hole length and interception depth
● hole length.
> If the exclusion of this information is justified on the basis that the information
is not Material and this exclusion does not detract from the understanding of
the report, the Competent Person should clearly explain why this is the case.
> MM&A reviewed and entered all pertinent data into a digital geologic database for
each Coronado property. The database consists of thousands of data records,
which include drill hole and supplemental coal seam thickness measurements from
outcrop and mine exposures.
> All drill holes in the database are provided with a collar elevation and the State
Plane Coordinate System easting and northing coordinate.
> After MM&A confirmed proper coal seam thickness and correlation, the seam data
was modelled and compiled into coal resource maps.
> The maps are provided in the TRS; however, a tabulation of the thousands of
individual data records is not practical to include.
Data aggregation
methods
> In reporting Exploration Results, weighting averaging techniques, maximum
and/or minimum grade truncations (e.g. cutting of high grades) and cut-off
grades are usually Material and should be stated.
> Where aggregate intercepts incorporate short lengths of high grade results
and longer lengths of low grade results, the procedure used for such
aggregation should be stated and some typical examples of such
aggregations should be shown in detail.
> The assumptions used for any reporting of metal equivalent values should be
clearly stated.
> Where a coal seam has been bench sampled (typically for surface mining) the
individual analyses for the coal plies are normally weight-averaged to represent the
total of recoverable coal.
> Coal quality summary results have been documented in the TRS. Average coal
quality on a per-seam basis is used to represent the coal resources within a given
mining area.
> Average coal quality for each Coronado complex is provided in Tables 1-1, 1-2 and
1-3 of this TRS.
> No other data aggregations methods are used.
Relationship
between
mineralisation
widths and
intercept lengths
> These relationships are particularly important in the reporting of Exploration
Results.
> If the geometry of the mineralisation with respect to the drill hole angle is
known, its nature should be reported.
> If it is not known and only the down hole lengths are reported, there should be
a clear statement to this effect (e.g. ‘down hole length, true width not known’).
> Coal thickness values from all coal intersections and down hole geophysical logs
are considered to be vertical thicknesses. Seam dip of approximately 2.0 to 3.0
degrees has little effect on the vertical thickness of the seam.
Diagrams
> Appropriate maps and sections (with scales) and tabulations of intercepts
should be included for any significant discovery being reported These should
include, but not be limited to a plan view of drill hole collar locations and
appropriate sectional views.
> Diagrams and maps showing the coal seam intercepts are presented in the TRS.
Balanced
reporting
> Where comprehensive reporting of all Exploration Results is not practicable,
representative reporting of both low and high grades and/or widths should be
practiced to avoid misleading reporting of Exploration Results.
> All of the available, qualified exploration data has been included within the
tabulations, maps, and diagrams for this TRS.
> Both coal thickness and quality data are deemed by MM&A to be reasonably
sufficient within the resource areas. Therefore, there is a reasonable level of
confidence in the geologic interpretations required for coal resource determination
based on the available data and the techniques applied to the data.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Statement of Coal Resources and Reserves
in Accordance with SEC and the JORC Code as of December 31, 2021
Northern and Central Appalachian Coal Basins –
Virginia, West Virginia and Pennsylvania, USA
Appendix D: JORC Table 1
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Criteria
JORC Code explanation
Commentary
Other substantive
exploration data
> Other exploration data, if meaningful and material, should be reported
including (but not limited to): geological observations; geophysical survey
results; geochemical survey results; bulk samples – size and method of
treatment; metallurgical test results; bulk density, groundwater, geotechnical
and rock characteristics; potential deleterious or contaminating substances.
> Informational material available from the U.S. Geological Survey and the respective
State Surveys was used to assist in the Resource estimate.
Further work
> The nature and scale of planned further work (e.g. tests for lateral extensions
or depth extensions or large-scale step-out drilling).
> Diagrams clearly highlighting the areas of possible extensions, including the
main geological interpretations and future drilling areas, provided this
information is not commercially sensitive.
> Further work is expected to include additional exploration, geotechnical testing,
coal quality analyses, and coal property acquisition.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Statement of Coal Resources and Reserves
in Accordance with SEC and the JORC Code as of December 31, 2021
Northern and Central Appalachian Coal Basins –
Virginia, West Virginia and Pennsylvania, USA
Appendix D: JORC Table 1
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Section 3 Estimation and Reporting of Mineral Resources
(Criteria listed in the preceding section also apply to this section.)
Criteria
JORC Code explanation
Commentary
Database
integrity
> Measures taken to ensure that data has not been corrupted by, for example,
transcription or keying errors, between its initial collection and its use for
Mineral Resource estimation purposes.
> Data validation procedures used.
> MM&A confirmed coal seam thickness and correlations in databases used for coal
deposit modelling. Representative records were spot-checked for data entry
validation.
> Geophysical logs were used wherever available to assist in confirming the seam
correlation and to verify proper seam thickness measurements and recovery of coal
samples.
Site
visits
> Comment on any site visits undertaken by the Competent Person and the
outcome of those visits.
> If no site visits have been undertaken indicate why this is the case.
> MM&A is very familiar with the Properties and has conducted multiple site visits
throughout the years.
Geological
interpretation
> Confidence in (or conversely, the uncertainty of) the geological interpretation of
the mineral deposit.
> Nature of the data used and of any assumptions made.
> The effect, if any, of alternative interpretations on Mineral Resource estimation.
> The use of geology in guiding and controlling Mineral Resource estimation.
> The factors affecting continuity both of grade and geology.
> Due to the relative structural simplicity of the deposits and the reasonable continuity
of the tabular coal beds, the principal geological interpretation necessary to define the
geometry of the coal deposits is the proper modeling of their thickness and elevation.
> Both coal thickness and quality data are deemed by MM&A to be reasonable within
the resource areas.
> Therefore, there is a reasonable level of confidence in the geologic interpretations
required for coal resource determination based on the available data and the
techniques applied to the data.
Dimensions
> The extent and variability of the Mineral Resource expressed as length (along
strike or otherwise), plan width, and depth below surface to the upper and lower
limits of the Mineral Resource.
> The subject coal resource areas mostly exist in discreet, individual deposits of highly
variable dimensions, shapes and depth below the ground surface.
> Such factors are best depicted in the maps contained in the TRS.
> Details of the parameters are cited within the TRS and included in the table of Cut-off
Parameters listed in Section 11.1 of the TRS.
Estimation
and
modelling
techniques
> The nature and appropriateness of the estimation technique(s) applied and key
assumptions, including treatment of extreme grade values, domaining,
interpolation parameters and maximum distance of extrapolation from data
points. If a computer assisted estimation method was chosen include a
description of computer software and parameters used.
> The availability of check estimates, previous estimates and/or mine production
records and whether the Mineral Resource estimate takes appropriate account
of such data.
> The assumptions made regarding recovery of by-products.
> Estimation of deleterious elements or other non-grade variables of economic
significance (e.g. sulphur for acid mine drainage characterisation).
> Geological data was imported into Carlson Mining
®
®
) geological
modelling software in the form of Microsoft
®
seam and thickness picks, bottom seam elevations and raw and washed coal quality.
These data files were validated prior to importing into the software.
> Once imported, a geologic model was created.
> The geological model was verified and reviewed.
> Resources were estimated by defining seam thickness at each point of observation
and by defining resource confidence arcs around the points of observation.
> Points of observation for Measured and Indicated confidence arcs were defined for all
drill holes that intersected the seam.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Statement of Coal Resources and Reserves
in Accordance with SEC and the JORC Code as of December 31, 2021
Northern and Central Appalachian Coal Basins –
Virginia, West Virginia and Pennsylvania, USA
Appendix D: JORC Table 1
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Criteria
JORC Code explanation
Commentary
> In the case of block model interpolation, the block size in relation to the
average sample spacing and the search employed.
> Any assumptions behind modelling of selective mining units.
> Any assumptions about correlation between variables.
> Description of how the geological interpretation was used to control the
resource estimates.
> Discussion of basis for using or not using grade cutting or capping.
> The process of validation, the checking process used, the comparison of model
data to drill hole data, and use of reconciliation data if available.
> As prescribed by the common United States classification system the following
distances from points of observation were used to define the corresponding Resource
category arcs:
-
feet (4.8 kilometers)
-
-
> The use of the standards commonly used in the United States are appropriate and
customary for this resource jurisdiction and deposition type.
> MM&A performed a geostatistical analysis test of the Coronado data sets using the
Drill Hole Spacing Analysis (
DHSA
) method.
> Based on MM&A’s analysis, it would be possible to extend the measured, indicated
and inferred arcs slightly beyond historically accepted practices due to consistent
geological settings. The QP’s have elected not to extend arc distances, introducing a
level of conservatism in the coal classification.
Moisture
> Whether the tonnages are estimated on a dry basis or with natural moisture,
and the method of determination of the moisture content.
> Coal resource tonnes are presented on a dry, in-situ basis.
> Reserve tonnes are presented on a moist basis at anticipated product moisture
ranging from 4.0 to 6.0 percent. Moisture content based on historic analyses of
shipped coal.
Cut-off
Parameters
> The basis of the adopted cut-off grade(s) or quality parameters applied.
> The cut-off parameters were tailored for each of the Coronado properties to be in
accordance with mining/ processing capabilities and market conditions prevalent at
each operation.
> Examples include minimum recoverable coal thickness, acceptable ash content and
wash recovery, and manageable overburden to coal ratio for surface mineable coal.
> Details of the parameters are cited within the TRS and included in the table of Cut-off
Parameters listed in Section 11.1 of this TRS.
> These cut-off parameters have been developed by MM&A based on its experience
with the Coronado properties and other mining operations of the Central Appalachian
coal basin. This experience includes technical and economic evaluations of
numerous properties in the region for the purposes of determining the economic
viability of the subject coal reserves.
Mining factors or
assumptions
> Assumptions made regarding possible mining methods, minimum mining
dimensions and internal (or, if applicable, external) mining dilution. It is always
necessary as part of the process of determining reasonable prospects for
eventual economic extraction to consider potential mining methods, but the
assumptions made regarding mining methods and parameters when estimating
Mineral Resources may not always be rigorous. Where this is the case, this
> Mining factors such as dilution, mining and washing recovery are variable and have
been applied at the coal deposits at each operation based on site-specific
characteristics.
> Details of the factors are cited within the TRS.
> Factors that would typically preclude conversion of a coal resource to coal reserve
include the following: inferred resource classification; absence of coal quality; poor
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Statement of Coal Resources and Reserves
in Accordance with SEC and the JORC Code as of December 31, 2021
Northern and Central Appalachian Coal Basins –
Virginia, West Virginia and Pennsylvania, USA
Appendix D: JORC Table 1
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Criteria
JORC Code explanation
Commentary
should be reported with an explanation of the basis of the mining assumptions
made.
mine recovery; lack of access; insufficient exploration; or uncontrolled surface
property for areas of proposed for surface mining.
> While such factors were used to preclude the conversion of a very limited number of
coal resources to coal reserves in this report, the extensive history of mining on the
Properties would suggest that there are reasonable prospects for eventual economic
extractions of all coal resources under favorable market conditions.
Metallurgical
factors or
assumptions
> The basis for assumptions or predictions regarding metallurgical amenability. It
is always necessary as part of the process of determining reasonable prospects
for eventual economic extraction to consider potential metallurgical methods,
but the assumptions regarding metallurgical treatment processes and
parameters made when reporting Mineral Resources may not always be
rigorous. Where this is the case, this should be reported with an explanation of
the basis of the metallurgical assumptions made.
> The products mined from coal resources controlled by Coronado can be sold into
high-, mid-, and low-volatile metallurgical coal markets because of their inherent
quality characteristics.
> Run-of-mine production is washed at the coal preparation plants as needed for quality
control.
> Coronado may blend production from multiple sources to manage ash and sulfur
content along with the rheological and petrographic characteristics of the shipped
products.
Environmental
factors or
assumptions
> Assumptions made regarding possible waste and process residue disposal
options. It is always necessary as part of the process of determining reasonable
prospects for eventual economic extraction to consider the potential
environmental impacts of the mining and processing operation. While at this
stage the determination of potential environmental impacts, particularly for a
greenfields project, may not always be well advanced, the status of early
consideration of these potential environmental impacts should be reported.
Where these aspects have not been considered this should be reported with an
explanation of the environmental assumptions made.
> MM&A completed a Limited Phase I Environmental Site Assessment (ESA) on the
Buchanan property in April 2016, and on the Logan County and Greenbrier Properties
in May 2017 on behalf of Coronado. Coronado reports not having conducted such a
study since the MM&A studies.
> The ESAs completed by MM&A included a site inspection, review of historical
records, a database search of State and Federal regulatory records and interviews to
identify potential recognized environmental conditions (RECs) that may create
environmental liability for the sites.
> MM&A identified one REC at Greenbrier associated with stained soil and gravel near
a fueling and maintenance area. Coronado reported to MM&A that satisfactory clean-
up efforts were completed at Greenbrier.
> Based on these former ESAs completed by MM&A, it is MM&A’s opinion that
Coronado has a generally typical coal industry record of compliance with applicable
mining, water quality, and environmental laws. Estimated costs for mine closure,
including water quality monitoring during site reclamation, are included in the TRS
financial models.
Bulk density
> Whether assumed or determined. If assumed, the basis for the assumptions. If
determined, the method used, whether wet or dry, the frequency of the
measurements, the nature, size and representativeness of the samples.
> The bulk density for bulk material must have been measured by methods that
adequately account for void spaces (vugs, porosity, etc), moisture and
differences between rock and alteration zones within the deposit.
> Discuss assumptions for bulk density estimates used in the evaluation process
of the different materials.
> Laboratory derived seam densities measured in specific gravity were used where
available. As needed, these data were supplemented by estimated seam density
values based on the relative proportion of coal and non-coal material within the seam
(typically at 1.30 and 2.25 specific gravity, respectively).
> Average seam density was determined for each coal deposit and used to convert coal
volumes into coal tonnage estimates.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Statement of Coal Resources and Reserves
in Accordance with SEC and the JORC Code as of December 31, 2021
Northern and Central Appalachian Coal Basins –
Virginia, West Virginia and Pennsylvania, USA
Appendix D: JORC Table 1
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Criteria
JORC Code explanation
Commentary
Classification
> The basis for the classification of the Mineral Resources into varying confidence
categories.
> Whether appropriate account has been taken of all relevant factors (i.e. relative
confidence in tonnage/grade estimations, reliability of input data, confidence in
continuity of geology and metal values, quality, quantity and distribution of the
data).
> Whether the result appropriately reflects the Competent
> Person’s view of the deposit.
> The Resource has been classified based on suitable distances from points of
observations prescribed in the common United States classification system.
> The use of the United States standards is appropriate and customary for this resource
jurisdiction and deposition type.3
> MM&A performed a geostatistical analysis test of the Coronado data sets using the
Drill Hole Spacing Analysis (
DHSA
) method.
> Based on MM&A’s analysis, it would be possible to extend the measured, indicated
and inferred arcs slightly beyond historically accepted practices due to consistent
geological settings. The QP’s have elected not to extend arc distances, introducing a
level of conservatism in the coal classification.
> All relevant factors have been accounted for and reflect the Competent Person’s view
of the deposit.
Audits or reviews
> The results of any audits or reviews of Mineral Resource estimates.
> MM&A completed prepared a statement of coal resources and reserves for the
Properties in accordance with the JORC Code as of December 31, 2017. MM&A also
subsequently updated the estimate of resources and reserves for depletion as of
December 31, 2018, December 31, 2019, and December 31, 2020.
> MM&A performed a previous audit of the Properties in year 2017 for Coronado based
on U.S. Securities and Exchange Commission (SEC) Industry Guide 7 and USGS
Circular 891 standards.
> Earlier audits were performed by various independent consultants for predecessors-
in-title to Coronado and at various levels of detail depending on the clients concerns
and the allotted time for completion. Previous audits and reviews defined the primary
coal resource areas and estimated the recoverable tonnes for each seam based on
the expected mining methods.
> Additionally, MM&A has performed proprietary evaluations for predecessors-in-title to
Coronado, which encompass portions of the Properties included in this TRS.
Discussion of
relative accuracy/
confidence
> Where appropriate a statement of the relative accuracy and confidence level in
the Mineral Resource estimate using an approach or procedure deemed
appropriate by the Competent Person. For example, the application of statistical
or geostatistical procedures to quantify the relative accuracy of the resource
within stated confidence limits, or, if such an approach is not deemed
appropriate, a qualitative discussion of the factors that could affect the relative
accuracy and confidence of the estimate.
> The statement should specify whether it relates to global or local estimates,
and, if local, state the relevant tonnages, which should be relevant to technical
and economic evaluation. Documentation should include assumptions made
and the procedures used.
> These statements of relative accuracy and confidence of the estimate should be
compared with production data, where available.
> The relative accuracy of and confidence in the coal tonnage and quality estimates
provided herein are judged to be in conformance with current industry best-practices.
> The representation of average coal quality characteristics should be understood to
represent a reasonably representative sampling that is generally indicative of coal
quality and does not represent a statistically rigorous approach to coal quality
modeling.
> Resource estimation has been completed using standard coal estimation methods
which are deemed appropriate for this deposit.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Statement of Coal Resources and Reserves
in Accordance with SEC and the JORC Code as of December 31, 2021
Northern and Central Appalachian Coal Basins –
Virginia, West Virginia and Pennsylvania, USA
Appendix D: JORC Table 1
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Section 4 Estimation and Reporting of Ore Reserves
(Criteria listed in the preceding section also apply to this section.)
Criteria
JORC Code explanation
Commentary
Mineral Resource
estimate for
conversion to Ore
Reserves
> Description of the Mineral Resource estimate used as a basis for the
conversion to an Ore Reserve.
> The coal resource estimate was prepared as part of the report Coronado Global
Resources Inc. Statement of Coal Resources and Reserves in Accordance with
JORC Code and United States SEC Standards as of December 31, 2021 –
Northern and Central Appalachian Coal Basins – Virginia, West Virginia and
Pennsylvania, USA – February 2022 prepared by MM&A.
> The resource estimation criteria were developed by MM&A based on the capabilities
of the mining equipment used within the production model and on industry-accepted
standards to assure that the basic geologic characteristics of the coal resources are
in reasonable conformity with those to be mined and marketed by Coronado.
> Clear statement as to whether the Mineral Resources are reported additional
to, or inclusive of, the Ore Reserves.
> Coal resources generally are reported inclusive of the coal reserves. In some
cases, resources are reported in addition to coal reserves. Tables 1-1 and 11 -3 of
the TRS clearly identify resources “inclusive of mine plan” from which coal reserves
were estimated along with those resources “exclusive of mine plan” from which no
reserves were estimated.
Site visits
> Comment on any site visits undertaken by the Competent Person and the
outcome of those visits.
> MM&A is very familiar with the Properties and has conducted multiple site visits
throughout the years.
Study status
> The type and level of study undertaken to enable Mineral Resources to be
converted to Ore Reserves.
> A preliminary feasibility LOM plan was prepared by MM&A for active and proposed
mines.
> The Code requires that a study to at least Pre-Feasibility Study level has been
undertaken to convert Mineral Resources to Ore Reserves. Such studies will
have been carried out and will have determined a mine plan that is technically
achievable and economically viable, and that material Modifying Factors have
been considered.
> This geologic evaluation conducted in accordance with JORC and SEC standards
and in conjunction with the preliminary feasibility study is sufficient to conclude that
the surface, highwall miner and underground coal reserves identified on the
Properties are economically mineable under reasonable expectations of market
prices for thermal and metallurgical coal products, estimated operation costs, and
capital expenditures.
> The pre-feasibility financial models, prepared by MM&A for this TRS, was developed
to test the economic viability of each coal resource area.
> Proved and probable coal reserve were derived from the defined in-situ coal
resource considering relevant processing, economic (including independent
estimates of capital, revenue and cost, marketing, legal, environmental,
socioeconomic, and regulatory factors).
Cut-off parameters
> The basis of the adopted cut-off grade(s) or quality parameters applied.
> The cut-off parameters were tailored for each of the Coronado properties to be in
accordance with mining/ processing capabilities and market conditions prevalent at
each operation.
> Examples include minimum recoverable coal thickness, acceptable ash content and
wash recovery, and manageable overburden to coal ratio for surface mineable coal.
> Details of the parameters are cited within the TRS and included in the table of Cut-
off Parameters listed in Section 11.1 of this TRS.
> These cut-off parameters have been developed by MM&A based on its experience
with the Coronado properties and are typical of mining operations in the Central
Appalachian coal basin. This experience includes technical and economic
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Statement of Coal Resources and Reserves
in Accordance with SEC and the JORC Code as of December 31, 2021
Northern and Central Appalachian Coal Basins –
Virginia, West Virginia and Pennsylvania, USA
Appendix D: JORC Table 1
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Criteria
JORC Code explanation
Commentary
evaluations of numerous properties in the region for the purposes of determining the
economic viability of the subject coal reserves.
Mining factors or
assumptions
> The method and assumptions used as reported in the Pre-Feasibility or
Feasibility Study to convert the Mineral Resource to an Ore Reserve (i.e. either
by application of appropriate factors by optimisation or by preliminary or
detailed design).
> After validating coal seam data and establishing correlations, the thickness and
elevation for seams of economic interest were used to generate a geologic model.
> A pre-feasibility LOM plan was prepared by MM&A for active and proposed mines.
MM&A prepared mine projections and production timing forecasts based on coal
seam characteristics. Production timing was carried out from 2022 to depletion
(exhaustion) of the coal reserve areas.
> The choice, nature and appropriateness of the selected mining method(s) and
other mining parameters including associated design issues such as pre-strip,
access, etc.
> The room-and-pillar mining method was selected to model the underground mining
resources, utilizing continuous miners for coal extraction, shuttle cars for production
section haulage and roof bolters for roof control, with the exception that the
Buchanan Mine also uses longwall shearers, armored face conveyors, and
hydraulic self-advancing roof support. The resource areas located above drainage
are relatively small and often have irregular boundaries.
The Buchanan Mine in
Buchanan County, Virginia is the only active longwall mine currently being operated
by Coronado.
> The Coronado underground mining resource areas which are located above-
drainage require an access road and mine access development along the outcrop,
whereas below-drainage mines are accessed via shaft or slope based on other
proposed surface infrastructure locations and/or surface property control.
> The surface mining method selected utilizes highly productive hydraulic shovels,
front-end loaders, large tractors and rock trucks for overburden removal. The
mobile equipment spreads adapt readily to winding coal outcrops for contour
surface mining and are effective for point-removal and area mining applications.
> Application of highwall and auger mining units is an effective method to recover coal
resources not suitable for underground mining and under excessive cover for
surface mining.
> The assumptions made regarding geotechnical parameters (e.g. pit slopes,
stope sizes, etc.), grade control and pre-production drilling.
> Mining plans for potential underground mines were developed by MM&A. Pillar
stability was tested by MM&A using the
Analysis of Coal Pillar Stability (ACPS
)
program that was developed by the
National Institute for Occupational Safety
and Health (
NIOSH
)
.
> Coronado must obtain approved mining plans from
United States Department of
Labor Mine Safety and Health Administration (
MSHA
)
that define safety
parameters for the highwalls developed during contour and area mining. MM&A’s
planning model does not require input of specific highwall design parameters, but
provides for timing of mining within mine plan polygons that is representative of the
operation performance attained at Central Appalachia surface mines.
> Highwall and auger mining is conducted under highwalls designed and constructed
to meet MSHA permit requirements. To better assure highwall stability and safety
during highwall coal extraction, MSHA requires that coal fenders, or stumps, be left
in place between successive cuts. Periodic barrier pillars must be left in place as an
additional safeguard. MM&A has adjusted the expected mining recovery for
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Statement of Coal Resources and Reserves
in Accordance with SEC and the JORC Code as of December 31, 2021
Northern and Central Appalachian Coal Basins –
Virginia, West Virginia and Pennsylvania, USA
Appendix D: JORC Table 1
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Criteria
JORC Code explanation
Commentary
highwall and auger mining resources to reflect highwall stability and safety
requirements.
> The major assumptions made and Mineral Resource model used for pit and
stope optimisation (if appropriate).
> Underground Mining Resources: For metallurgical resources, minimum coal seam
thickness extends down to between 0.6 and 1.2 meters and a minimum overburden
(depth of cover) of 30.5 meters. A 61-meter horizontal distance is maintained from
abandoned mines and sealed or pillared areas, and a 30-meter horizontal distance
is maintained from planned highwall miner panels. Mine recovery is reduced when
a rider coal seam is present within a 1.5- to 3.0-meter interval above the coal seam.
No mining is projected when the interval between overlying and underlying reserves
is less than 12 meters.
> Surface Mining Resources: For classification as a surface-mineable resource, a
seam must be at least 0.3 meters in thickness as a stand-alone (principle) seam
and 0.15 meters in thickness when less than 0.8 meters from a principle seam. The
maximum cumulative area mining strip ratio is generally 20:1 for thermal coal and
30:1 for metallurgical coal. Some areas were assessed for their economic viability
at higher ratios, and were included as reserves if deemed economic. For contour
surface mining, a minimum of 38-meter bench is provided to support HWM.
> HWM and Auger Mining Resources: HWM cut depth (penetration) is established at
a maximum of 244 meters. The minimum mineable coal thickness is limited at 0.6
meters. For coal seams less than 0.8 meters thick, roof and/or floor characteristics
must allow OSD cutting to maintain a 0.8-meter minimum cutting height.
Auger
mining cut depth is established at an average of 91 meters. The minimum mineable
coal thickness is limited at 0.5 meters.
> The mining dilution factors used.
> Underground Mining Reserves: The planning model assigns minimum mining
heights of 1.4 to 1.8 meters for mains and panel development. At the Buchanan
Mine, a minimum mining height of 1.8 meters was used due to the longwall mining
method being employed. For coal seams thinner than the assigned mining height,
the difference between the coal seam height and assigned mining height consists of
OSD. In all cases a minimum of 0.05 meters of OSD was assumed, with the
exception of the Mon Valley mines, where a minimum 0.15 meters of OSD was
assumed due to weaker floor strata.
> Surface Mining Reserves: Area mining is generally limited to a cumulative
overburden ratio of 30:1 and a 15:1 ratio for contour mining. Exceptions were
considered for mining of metallurgical grade coal where deemed economical. It is
assumed that careful cleaning of exposed coal pits will result in minimal OSD.
> HWM and Auger Mining Reserves: The mining plan assumes that the HWM cutting
height is a minimum of 76 to 99 centimeters for clearance purposes. When the coal
seam is less than 76 to 99 centimeters thick, OSD assumed and included in the
ROM product.
Because the auger has very limited OSD cutting ability, it is assumed
that an appropriate auger diameter will be chosen based on the coal seam
thickness and that OSD will be minimal.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Statement of Coal Resources and Reserves
in Accordance with SEC and the JORC Code as of December 31, 2021
Northern and Central Appalachian Coal Basins –
Virginia, West Virginia and Pennsylvania, USA
Appendix D: JORC Table 1
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Criteria
JORC Code explanation
Commentary
> The mining recovery factors used.
> Underground Mining Reserves: Mine recovery generally varies between 40 and 60
percent for continuous mining panels, and 100 percent for longwall.
> Surface Mining Reserves: Mining recovery is 90 percent for virgin areas. Mining
recovery is reduced where second mining is projected in previously underground
and auger mined areas.
> HWM and Auger Mining Reserves: A mine recovery of 40 percent has been applied
for HWM.
A mine recovery of 35 percent has been applied for auger mining.
> Any minimum mining widths used.
> Underground Mining Reserves: Typical entry width is 5.8 to 6.1 meters.
> The manner in which Inferred Mineral Resources are utilised in mining studies
and the sensitivity of the outcome to their inclusion.
> Proved and probable coal reserve were derived from the defined in-situ coal
resource considering relevant processing, economic (including independent
estimates of capital, revenue and cost, marketing, legal, environmental,
socioeconomic, and regulatory factors).
> Mine plan LOM tonnage includes inferred coal and those areas that do not meet the
minimum coal thickness requirement for classification as reserve. Inferred coal
represents approximately 0.6% of the LOM production for Mon Valley and 0.04% of
the total LOM production for Logan. None of this coal was included in the estimate
of reserves
> The infrastructure requirements of the selected mining methods.
> Underground Mining Resources: The continuous mining method provides for the
extraction of coal from the production faces using continuous miners (and longwall
shearing machine at Buchanan) and haulage using shuttle cars or battery haulers to
a feeder-breaker located at the tail of the section conveyor belt. The feeder-breaker
crushes large pieces of coal and rock and regulates coal feed onto the mine
conveyor. A chain conveyor is used to remove coal from the longwall face at the
Buchanan Mine for placement onto the conveyor belt which is ultimately delivered to
an underground storage bunker. Roof-bolting machines are used to install roof
bolts, and battery scoops are available to clean the mine entries and assist in
delivery of mine supplies to work areas. Surface ventilation fans are installed as
needed to provide a sufficient volume of air to ventilate production sections, coal
haulage and transport entries, battery charging stations, and transformers in
accordance with approved plans.
> Coronado currently operates three coal preparation plants, one each at the
Buchanan, Logan County and Greenbrier Divisions. The Buchanan Plant operates
at a feed rate of approximately 907 raw tonnes per hour (
tph
), whereas the
Saunders Plant (Logan County Division) has a nominal feed rate of 816 tph, and the
Mountaineer Plant (Greenbrier Division) operates at 544 tph.
MM&A has included
capital estimates for construction of additional coal preparation plants at the Russell
County and Mon Valley Complex for the purposes of this TRS.
> Surface Mining Resources: The surface mining mobile equipment spreads advance
the contour and area mining pits while systematically reclaiming the trailing side of
pits where coal has been removed. The coal haul roads are extended and
maintained as the pits advance. Support facilities are maintained nearby but away
from the active mining, and include storage areas for blasting agents, fuel and
lubricants, and mine supplies along with maintenance facilities and offices. Most of
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Statement of Coal Resources and Reserves
in Accordance with SEC and the JORC Code as of December 31, 2021
Northern and Central Appalachian Coal Basins –
Virginia, West Virginia and Pennsylvania, USA
Appendix D: JORC Table 1
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Criteria
JORC Code explanation
Commentary
the surface mine production is transported to a loading point for crushing, blending
and direct-shipment to customers.
> HWM and Auger Resources: The HWM equipment advances along with the contour
mining pits. The rate of advance of the contour mining is governed by the
advancement rate of the HWM. A diesel-powered generator trails the highwall
miner and powers the continuous mining unit. Other support facilities are provided
along with the contour mining support facilities. HWM production is all transported
by truck to the coal preparation plant for washing.
Metallurgical
factors or
assumptions
> The metallurgical process proposed and the appropriateness of that process to
the style of mineralisation.
> Coarse material is washed in a heavy medium vessel. Intermediate-size material is
washed in heavy medium cyclones. Fine material is washed using conventional
froth flotation cells.
> Whether the metallurgical process is well-tested technology or novel in nature.
> Processes are typical of those used in the coal industry and are in use at adjacent
coal processing plants.
> The nature, amount and representativeness of metallurgical test work
undertaken, the nature of the metallurgical domaining applied and the
corresponding metallurgical recovery factors applied.
> The quality characteristics for the subject coal resources and coal reserves have
been reviewed in detail by MM&A. The drill hole data were utilized to develop
average coal quality characteristics mining site. These average coal quality
characteristics were then utilized as the basis for determining the various markets
into which the saleable coal will likely be placed.
> Any assumptions or allowances made for deleterious elements.
> No significant effects on product quality are anticipated from dilution material; float
product quality was used to model final product quality.
> The existence of any bulk sample or pilot scale test work and the degree to
which such samples are considered representative of the orebody as a whole
> No bulk sample or pilot scale work has been completed.
> For minerals that are defined by a specification, has the ore reserve estimation
been based on the appropriate mineralogy to meet specifications?
> Notwithstanding the complexity of the coal quality data set, the seams of the central
and northern Appalachian coalfields have a long history of providing both high-Btu
thermal coals and high-, mid- and low-volatile coking coals with favorable
metallurgical properties.
Environmental
> The status of studies of potential environmental impacts of the mining and
processing operation. Details of waste rock characterisation and the
consideration of potential sites, status of design options considered and, where
applicable, the status of approvals for process residue storage and waste
dumps should be reported.
> MM&A completed a Limited Phase I Environmental Site Assessment (
ESA
) on the
Buchanan property in April 2016, and on the Logan County and Greenbrier
Properties in May 2017 on behalf of Coronado.
> MM&A identified one REC at Greenbrier associated with stained soil and gravel
near a fueling and maintenance area. Coronado reported to MM&A that satisfactory
clean-up efforts were completed at Greenbrier.
> Based on these former ESAs completed by MM&A, it is MM&A’s opinion that
Coronado has a generally typical coal industry record of compliance with applicable
mining, water quality, and environmental laws. Estimated costs for mine closure,
including water quality monitoring during site reclamation, are included in the TRS
financial models.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Statement of Coal Resources and Reserves
in Accordance with SEC and the JORC Code as of December 31, 2021
Northern and Central Appalachian Coal Basins –
Virginia, West Virginia and Pennsylvania, USA
Appendix D: JORC Table 1
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Criteria
JORC Code explanation
Commentary
Infrastructure
> The existence of appropriate infrastructure: availability of land for plant
development, power, water, transportation (particularly for bulk commodities),
labour, accommodation; or the ease with which the infrastructure can be
provided or accessed.
> Coronado currently operates one surface mine (Toney Fork Mine at the Logan Mine
Complex); Coronado also controls the idle Midland Surface Mine at the Greenbrier
Mine Complex.
> Coronado operates five underground mines as follows: Buchanan Mine at the
Buchanan Mine Complex; Powellton #1, Eagle No. 1, Muddy Bridge and Lower War
Eagle Mines in the Logan Mine Complex; the Mountaineer #1 Mine at the
Greenbrier Mine Complex is currently idle.
> All ROM production is currently planned for either truck transportation from the
mines to the processing or shipping facilities, or in some cases there is either a
current or planned mine mouth preparation plant and barge/rail loading facility.
> There is a network of public highways that provide serviceable coal haul routes and
private, internal roads on the Properties would be developed as may be needed.
Rail service to the Properties is most readily provided by NS and CSX
with
connections to both domestic consumers and international trans-shipment points.
NS track is located across the Monongahela River from the proposed Pangburn
Hollow load-out facility. Coal would be shipped to customers via barge and rail and
sold as both metallurgical and thermal products.
Costs
> The derivation of, or assumptions made, regarding projected capital costs in
the study.
> The methodology used to estimate operating costs.
> Coronado provided historical and 5-year budget operating costs for its active mines
for MM&A’s review. MM&A used the historical and/or budget cost information as a
reference and developed personnel schedules for each mine. Hourly labor rates
and salaries were based upon information contained in Coronado’s financial
summaries. Fringe benefit costs were developed for vacation and holidays, federal
and state unemployment insurance, retirement, workers’ compensation and
pneumoconiosis, casualty and life insurance, healthcare and bonuses. A cost factor
for mine supplies was developed that relates expenditures to mine advance rates for
roof control costs and other mine supply costs at underground mines. Other factors
were developed for maintenance and repair costs, rentals, mine power, outside
services and other direct mining costs
> Surface mine direct operating costs were developed as a function of overburden
ratio for repair and maintenance supplies, diesel fuel, explosives and blasting, and
miscellaneous supplies and services. Operating costs for highwall mines are based
on costs per ROM tonne estimates. Other cost factors were developed for coal
preparation plant processing, refuse handling, coal loading, trucking, property taxes,
and insurance and bonding. Appropriate royalty rates were assigned for production
from leased coal lands and sales taxes were calculated for state severance taxes,
the federal black lung excise tax, and federal and state reclamation fees.
> Capital schedules were developed by MM&A for mine development, infrastructure,
and on-going capital requirements for the life of each projected mine.
> Staffing levels were prepared and operating costs estimated by MM&A for each
projected mine. MM&A utilized historical cost data provided by Coronado and its
own knowledge and experience to estimate direct and indirect operating costs.
> Allowances made for the content of deleterious elements.
> No allowances have been made for deleterious elements; no impact to quality from
deleterious elements is anticipated.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Statement of Coal Resources and Reserves
in Accordance with SEC and the JORC Code as of December 31, 2021
Northern and Central Appalachian Coal Basins –
Virginia, West Virginia and Pennsylvania, USA
Appendix D: JORC Table 1
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Criteria
JORC Code explanation
Commentary
> The derivation of assumptions made of metal or commodity price(s), for the
principal minerals and co- products.
> Coronado provided MM&A with price forecasts for all Properties. Customer coal
pricing is derived from market observed forward estimates based on global
economic supply and demand analysis which is applied to mine plan sales volumes
and product mix and is supplemented with Coronado’s in-house knowledge of
applicable rail transportation charges, ocean freight charges and port charges. Coal
price forecasts for the various products were provided by Coronado for various coal
markets in terms of US nominal dollars per metric tonne. MM&A utilized this data
for price forecasting in financial modeling.
> Derivation of transportation charges.
> Coronado provided MM&A with price forecasts for all Properties. Customer coal
pricing is derived from market observed forward estimates based on global
economic supply and demand analysis which is applied to mine plan sales volumes
and product mix and is supplemented with Coronado’s in-house knowledge of
applicable rail transportation charges, ocean freight charges and port charges. Coal
price forecasts for the various products were provided by Coronado for various coal
markets in terms of US nominal dollars per metric tonne. MM&A utilized this data
for price forecasting in financial modeling.
> The basis for forecasting or source of treatment and refining charges, penalties
for failure to meet specification, etc.
> MM&A utilized historical cost data provided by Coronado and its own knowledge
and experience to estimate direct and indirect operating costs. All ROM production
is currently planned for either truck transportation from the mines to the processing
or shipping facilities, or in some cases there is either a current or planned mine
mouth preparation plant and barge/rail loading facility.
> The allowances made for royalties payable, both Government and private.
> Appropriate royalty rates were assigned for production from leased coal lands and
sales taxes were calculated for state severance taxes, the federal black lung excise
tax, and federal and state reclamation fees.
Revenue factors
> The derivation of, or assumptions made regarding revenue factors including
head grade, metal or commodity price(s) exchange rates, transportation and
treatment charges, penalties, net smelter returns, etc.
> Coronado provided MM&A with price forecasts for all Properties. Customer coal
pricing is derived from market observed forward estimates based on global
economic supply and demand analysis which is applied to mine plan sales volumes
and product mix and is supplemented with Coronado’s in-house knowledge of
applicable rail transportation charges, ocean freight charges and port charges. Coal
price forecasts for the various products were provided by Coronado for various coal
markets in terms of US nominal dollars per metric tonne. MM&A utilized this data
for price forecasting in financial modeling.
> The derivation of assumptions made of metal or commodity price(s), for the
principal metals, minerals and co-products.
> Coal sales prices as defined above. All reported reserves are on a marketable
basis.
Market assessment
> The demand, supply and stock situation for the particular commodity,
consumption trends and factors likely to affect supply and demand into the
future.
> Coronado provided MM&A with price forecasts for all Properties. Customer coal
pricing is derived from market observed forward estimates based on global
economic supply and demand analysis which is applied to mine plan sales volumes
and product mix and is supplemented with Coronado’s in-house knowledge of
applicable rail transportation charges, ocean freight charges and port charges. Coal
price forecasts for the various products were provided by Coronado for various coal
markets in terms of US nominal dollars per metric tonne. MM&A utilized this data
for price forecasting in financial modeling.
![ex964p47i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p47i0.jpg)
Statement of Coal Resources and Reserves
in Accordance with SEC and the JORC Code as of December 31, 2021
Northern and Central Appalachian Coal Basins –
Virginia, West Virginia and Pennsylvania, USA
Appendix D: JORC Table 1
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Criteria
JORC Code explanation
Commentary
> A customer and competitor analysis along with the identification of likely market
windows for the product.
> All of the mine production serves metallurgical and thermal markets. The
metallurgical coal is marketed as high-volatile (typically 28 percent or greater volatile
matter content); mid-volatile (typically 23- to 27-percent volatile matter content) and
low-volatile (typically less than 23 percent volatile matter content) products.
> Raw ROM production that requires washing is currently processed through
Coronado owned and operated coal preparation plants.
> ROM coal that does not require further processing is delivered directly to the loading
points for sizing and delivery to customers. Coronado has access to two rail-loading
points serviced by the
Norfolk Southern Corporation (
NS
)
points serviced by
CSX Corporation (
CSX
)
.
> Price and volume forecasts and the basis for these forecasts.
> Carlson Mining 2020
®
and surface-mineable coal seams. Underground mine plans were sequenced
based on productivity schedules provided by Coronado, which were based on
historically achieved productivity levels. Surface mine plans were generated under
productivity assumptions (bank cubic yard per shift) as provided by Coronado and
reviewed by MM&A, again based heavily on productivity levels achieved by
Coronado. All production forecasting ties assumed production rates to geological
models as constructed independently by MM&A’s team of geologists and mining
engineers.
> Coronado provided MM&A with price forecasts for all Properties. Customer coal
pricing is derived from market observed forward estimates based on global
economic supply and demand analysis which is applied to mine plan sales volumes
and product mix and is supplemented with Coronado’s in-house knowledge of
applicable rail transportation charges, ocean freight charges and port charges. Coal
price forecasts for the various products were provided by Coronado for various coal
markets in terms of US nominal dollars per metric tonne. MM&A utilized this data
for price forecasting in financial modeling.
Economic
> The inputs to the economic analysis to produce the net present value (NPV) in
the study, the source and confidence of these economic inputs including
estimated inflation, discount rate, etc.
> On an unlevered basis, the NPV of the project cash flows after taxes was estimated
for the purpose of classifying coal reserves. The project cash flows, excluding debt
service, are calculated by subtracting direct and indirect operating expenses and
capital expenditures from revenue. Direct costs include labor, drilling and blasting,
operating supplies, maintenance and repairs, facilities costs for materials handling,
coal preparation, refuse disposal, coal loading, sampling and analysis services,
reclamation and general and administrative costs. Indirect costs include statutory
and legally agreed upon fees related to direct extraction of the mineral. The indirect
costs are the Federal black lung tax, Federal and State reclamation taxes, property
taxes, local transportation prior to delivery at rail or barge loading sites, coal
production royalties, sales and use taxes, income taxes and State severance taxes.
Coronado’s historical costs provided a useful reference for MM&A’s cost estimates.
> Coronado provided MM&A with price forecasts for all Properties. Customer coal
pricing is derived from market observed forward estimates based on global
economic supply and demand analysis which is applied to mine plan sales volumes
and product mix and is supplemented with Coronado’s in-house knowledge of
applicable rail transportation charges, ocean freight charges and port charges. Coal
price forecasts for the various products were provided by Coronado for various coal
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Statement of Coal Resources and Reserves
in Accordance with SEC and the JORC Code as of December 31, 2021
Northern and Central Appalachian Coal Basins –
Virginia, West Virginia and Pennsylvania, USA
Appendix D: JORC Table 1
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markets in terms of US nominal dollars per metric tonne. MM&A utilized this data
for price forecasting in financial modeling.
> All costs and prices are based on 2021 nominal United States dollars.
> A pre-feasibility LOM plan was prepared by MM&A for active and proposed mines.
MM&A prepared mine projections and production timing forecasts based on coal
seam characteristics. Production timing was carried out from 2022 to depletion
(exhaustion) of the coal reserve areas, which is projected for the year 2099.
> The all-mines average cash cost ranges between approximately $56 and $311 per
tonne for most of the operating period.
> NPV ranges and sensitivity to variations in the significant assumptions and
inputs.
> An estimate of NPV at a base discount rate of 10.0% was included in Section 19 of
the TRS.
> NPV of the Buchanan, Russell, Mon Valley, Logan and Greenbrier Properties was
estimated to be $1.580 billion, $89.7 million, $287.3 million, $611.3 million and
$66.0 million, respectively.
> The sensitivity study shows the NPV at the 10.0% discount rate when Base Case
sales prices, operating costs, and capital costs are increased and decreased in
increments of 5% within a +/- 15% range.
Social
> The status of agreements with key stakeholders and matters leading to social
license to operate.
> Portions of the properties are located near local communities. Regulations prohibit
mining activities within 91 meters of a residential dwelling, school, church, or similar
structure unless written consent is first obtained from the owner of the structure.
Where required, such consents have been obtained where mining is proposed
beyond the regulatory limits.
Other
To the extent relevant, the impact of the following on the project and/or on the
estimation and classification of the Ore Reserves:
> Any identified material naturally occurring risks.
> No material naturally occurring risks have been identified.
> The status of material legal agreements and marketing arrangements.
> The Coronado coal resources are located in Buchanan, Russell and Tazewell
Counties, Virginia; Greenbrier, Logan, Boone, Wyoming and Greenbrier Counties,
West Virginia; Allegheny, Washington and Westmoreland Counties, Pennsylvania.
> MM&A has not carried out separate title verification for the coal properties and has
not verified leases, deeds, surveys or other property control instruments pertinent to
the subject resources.
> Coronado has represented to MM&A that it controls the mining rights to the reserves
as shown on its property maps, and MM&A has accepted these as being a true and
accurate depiction of the mineral rights controlled by Coronado. The TRS assumes
the properties are developed under responsible and experienced management.
> The status of government agreements and approvals critical to the viability of
the project, such as mineral tenement status and government and statutory
approvals. There must be reasonable grounds to expect that all necessary
Government approvals will be received within the timeframes anticipated in the
> Coronado has obtained all mining and discharge permits to operate 34 underground
mines, 13 surface mines, and 18 processing, loadout or related facilities. MM&A is
unaware of any obvious or current Coronado permitting issues that are expected to
prevent the issuance of future permits. Coronado, along with all Central and
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Statement of Coal Resources and Reserves
in Accordance with SEC and the JORC Code as of December 31, 2021
Northern and Central Appalachian Coal Basins –
Virginia, West Virginia and Pennsylvania, USA
Appendix D: JORC Table 1
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Pre-Feasibility or Feasibility study. Highlight and discuss the materiality of any
unresolved matter that is dependent on a third part on which extraction of the
reserve is contingent.
Northern Appalachian basin coal producers, is subject to a level of uncertainty
regarding future clean water permits due to
United States Environmental
Protection Agency
(
EPA
)
Classification
> The basis for the classification of the Ore Reserves into varying confidence
categories. Whether the result appropriately reflects the Competent Person’s
view of the deposit. The proportion of Probable Ore Reserves that have been
derived from Measured Mineral Resources (if any).
> Measured and indicated resources have been converted to proved and probable
reserves, respectively.
> None of the probable coal reserves have been derived from measured resources.
> In a limited number of cases where there was only very limited data available to
demonstrate the metallurgical suitability of a given coal deposit, that deposit was
classified as a probable reserve instead of a proved reserve.
> The results of this TRS define an estimated total initial ROM recoverable ore (coal)
reserve estimate of 556 million tonnes for Coronado as follows:
a) Buchanan = 160 Mt
b) Logan = 137 Mt
c) Greenbrier= 12 Mt
d) Russell = 50 Mt
e) Mon Valley = 197 Mt
> Coronado controls a total of 342 Mt (moist basis) of marketable coal reserves for
Coronado as of December 31, 2021. Of that total, 72 percent are proved, and 28
percent are probable. Total reserves by complex are as follows:
a) Buchanan = 98 Mt
b) Logan = 73 Mt
c) Greenbrier= 7 Mt
d) Russell = 30 Mt
e) Mon Valley = 134 Mt
Audits or reviews
> The results of any audits or reviews of Ore Reserve estimates.
> MM&A completed prepared a statement of coal resources and reserves for the
Properties in accordance with the JORC Code as of December 31, 2017. MM&A
also subsequently updated the estimate of resources and reserves for depletion as
of December 31, 2018, December 31, 2019, and December 31, 2020.
> MM&A performed a previous audit of the Properties in year 2017 for Coronado
based on
U.S. Securities and Exchange Commission (
SEC
)
standards. Earlier audits were performed by various independent consultants for
predecessors-in-title to Coronado and at various levels of detail depending on the
clients concerns and the allotted time for completion. Previous audits and reviews
defined the primary coal resource areas and estimated the recoverable tonnes for
each seam based on the expected mining methods.
> Additionally, MM&A has performed proprietary evaluations for predecessors-in-title
to Coronado, which encompass portions of the Properties included in this TRS.
Discussion of
relative accuracy/
confidence
> Where appropriate a statement of the relative accuracy and confidence level in
the Ore Reserve estimate using an approach or procedure deemed appropriate
by the Competent Person. For example, the application of statistical or
geostatistical procedures to quantify the relative accuracy of the reserve within
stated confidence limits, or, if such an approach is not deemed appropriate, a
> Operations on the Properties by Coronado and its predecessors have been on-
going for many years.
> MM&A is confident that the mine plans and financial models are reasonably
representative to provide an accurate estimation of coal reserves.
> Mine development and operation have not been optimized within the TRS.
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Statement of Coal Resources and Reserves
in Accordance with SEC and the JORC Code as of December 31, 2021
Northern and Central Appalachian Coal Basins –
Virginia, West Virginia and Pennsylvania, USA
Appendix D: JORC Table 1
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qualitative discussion of the factors which could affect the relative accuracy
and confidence of the estimate.
> The statement should specify whether it relates to global or local estimates,
and, if local, state the relevant tonnages, which should be relevant to technical
and economic evaluation. Documentation should include assumptions made
and the procedures used.
> Proved and probable coal reserve were derived from the defined in-situ coal
resource considering relevant processing, economic (including independent
estimates of capital, revenue and cost), marketing, legal, environmental,
socioeconomic, and regulatory factors on a global scale as current local data
reflects the global assumptions.
> Accuracy and confidence discussions should extend to specific discussions of
any applied Modifying Factors that may have a material impact on Ore Reserve
viability, or for which there are remaining areas of uncertainty at the current
study stage.
The major risk factors for the active Coronado mines and future resource development
are summarized below:
> Mine Accidents
> Highwall Failure. Highwall failures are likely to result in a temporary mine closure
and should not have a material impact on the mine sustainability. The risk is
considered to be probable.
> Adverse Geological Conditions. Adverse geological conditions include such
conditions as faults and sandstone washes. The risk is considered to be probable.
The impact is expected to be temporary with little material impact on mine
sustainability.
> Environmental Risk. Numerous federal and state permits are required to operate
coal mines and mine surface facilities. Permitting rules are complex and may
change over time, making compliance difficult or impossible.
> Water Quality. Permit requirements to fulfill Clean Water Act obligations are subject
to modification. The probability of water quality changes having a material impact
on mine operations is possible. As a contemporary example, the selenium
discharge issue that affects western Canadian and Central Appalachian Basin
operators has only recently emerged as a concern and its ultimate impact has not
been determined.
> New Permits. Permit protests by environmental groups and individuals can
contribute to permit delays or denial and increase the cost of permitting and delay
development. Surface mining activities, coal refuse disposal and construction of
access roads in mountainous terrain often require storage of material in valley fills.
Authority to dispose of fill material into waters of the United States must be granted
by the
United States Army Corps of Engineers (
COE
)
. COE permits are
increasingly difficult to obtain.
> Regulatory Requirements. Adverse impact from regulatory changes is considered
to be probable. The impact will likely affect the broader industry and is not expected
to result in mine closure.
> Market Risk. Metallurgical and thermal coal markets ultimately depend upon the
global steel and thermal coal demand and are considered to be volatile. Currently,
the US coal market has seen a decline in demand for thermal coal due to thermal
plant closures, as a result of new air and water pollution regulations, and
competition from other commodities used for power generation such as natural gas.
This has resulted in an overall decline in CAPP coal production. Continued
![ex964p2i0.jpg](https://capedge.com/proxy/10-K/0001562762-22-000043/ex964p2i0.jpg)
Statement of Coal Resources and Reserves
in Accordance with SEC and the JORC Code as of December 31, 2021
Northern and Central Appalachian Coal Basins –
Virginia, West Virginia and Pennsylvania, USA
Appendix D: JORC Table 1
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regulatory changes and declining demand could result in material changes in
domestic and global coal markets. The impact cannot be predicted at this time;
however, while MM&A expects the coal reserve within this TRS to remain
economically viable throughout the life of the projected mines, the LOM financial
model is very sensitive to changes in coal sales price and therefore market risk is
not insignificant.
> Labor Risk. Work stoppage due to organized labor protests is considered to be
unlikely and not likely to lead to permanent mine closure. The mines are likely to
suffer the loss of key supervisors and skilled employees due to retirement as the
workforce ages. The problem is industry-wide and the impact is expected to be
temporary and have no sustained impact on coal production.
> Availability of Equipment and Supplies. Risk of equipment and supply availability is
likely to be temporary and should not have a sustained adverse impact on the
production of coal.
> Transportation Delay. Interruption of coal transport services by river or rail is
considered to be probable but unlikely to have a sustained impact on coal
production.
> It is recognised that this may not be possible or appropriate in all
circumstances. These statements of relative accuracy and confidence of the
estimate should be compared with production data, where available.
> Mine plans, productivity expectations and cost estimates generally reflect historical
performance and efforts have been made to adjust plans and costs to reflect future
conditions.