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Project Summary

Hunnu Coal has identified and consolidated a portfolio of exploration and mining licences it considers to be prospective for high quality coking and thermal coals able to be developed for both the domestic and export markets.

A summary of Hunnu Coal's licences is below:

 

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Project Location Interest Type Description Exploration
Area
Altai Nuurs Gobi Altai 70% Coking

6 Exploration Licences and 4 mining licences
Major drilling programmes planned for 2011
Granted Mining Licences with a Fast Track development scenario
Preliminary open cut modelling potentially indicates a low strip ratio of 3.5:1
Close proximity to sale points at either mine gate or trucked approximately 250km by road to the Burgastai border crossing into China

46,212 ha
Unst Khudag Middle Gobi 80% Thermal 2 Exploration Licences and 1 Mining Licence
Initial Coal Resource of approximately 324Mt based on less than 30% of the available data, with 226Mt in the Measured and Indicated JORC categories (18.85Mt Measured, 207.4Mt Indicated).
Government authorities have approved mining of 98.7Mt of coal
Offtake agreements currently being discussed with Mongolian and Chinese coal users
Coal is located at less than 4m from surface with a low strip ratio of less than 1:1 from start-up
Acquisition of 20,000m2 of land at the Choir rail head
Commenced construction of a rail spur at Choir depot to the Trans-Mongolian Railway
The prxoject is located 180km from the Mongolian railway grid and a feasibility study has commenced into a Choir to Unst Khudag rail line
59,000 ha
Tsant Uul South Gobi 80% - 90% Coking Located within close proximity to surrounding infrastructure including 6km from existing haulage road to China and a proposed rail line to China peripheral to the project
Initial Coal Resource of approximately 90Mt, with 61Mt in the Measured and Indicated JORC categories (34Mt Measured, 27Mt Indicated)
Permitting process for the granting of a mining licence nearing completion
Located close to other key development projects including the Tavan Tolgoi Coking Coal Field, Oyu Tolgoi Copper Gold and UHG Coking Coal Mine
Aggressive exploration program planned for 2011 and first coal production is anticipated to commence in the latter half of 2011
69,000 ha
Buyan South Gobi 60% Coking Located within the giant Tavan Tolgoi Coking Coal Field, within 10km of existing exporting mines
Expected to benefit from existing infrastructure in place and advanced construction of a rail line
Expect to commence a detailed exploration program in 2Q 2011
76 ha
Tenuun-2 South Gobi 60% Thermal Two main areas of interest exist; the southern and northwest areas
Extensive drilling, Geological mapping and geophysical survey studies have been undertaken
30,360 ha
Tsokhio South Gobi 60% Coking Highly prospective project for both coking and thermal coals
Discovery of coal seam outcrop ~3km in strike length, has been intersected with single trench with thickness ~5m
Exploration drilling currently underway
38,600 ha
Khuree-2 South Gobi 60% Thermal / Coking Exploration has consisted of 14 trenches and 230m of drilling in 2 cored boreholes
Geological mapping and geophysical survey studies have been undertaken
Further exploration drilling currently underway
28,823 ha
Tsagaan Delger Middle Gobi 85% Thermal Early stage project with minimal exploration to date 10,454 ha
Delgereh Middle Gobi 85% Thermal Early stage project with minimal exploration to date 10,943 ha
Ar Zuun Gol/ Zuun Gol Gobi Altai 70% Coking Consists of two contiguous Exploration Licences (7854X and 10306X)
Drilling is currently underway with analysis and modelling to be completed to define JORC resources by end of 2011
25,640 ha
Sukhbaatar Other 60% Thermal Includes 3 Exploration licences – Munh Haan, Nariin and Khavtsal 36,233 ha