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 To put it another way: how much coal can we dig up; and what does it taste like?

 Hunter Valley regional overview

 Aerial view of the Integra complex. Todays presentation will focus on the Northern Open Cut in particular, although the geological features discussed are present throughout the entire lease area. The Integra Open Cut is situated 10km North West of Singleton, New South Wales in the Hunter Valley region. A thin seam mining operation, the mine is managed and operated by Integra Coal Operations Pty Ltd on behalf of the joint venture parties. Vale Australia holds a 61.2% equity stake in the asset. Two coal types are produced; comprising a semi-soft and a thermal product. Vale Australia has been using Vulcan software at the Integra Open Cut coal mine since 2009, for detailed geological modelling, survey and mine planning.

 Photo of the final wall of the South Open Cut during the early stage overburden removal of the Western Extension This photo illustrates the degree of seam splitting over short distances Geologically, this is not a simple deposit

 Close up view of the North Open Cut end wall, close to the Base of Weathering This slide illustrates the challenges in accurate geological modelling and prediction

 Structural generation includes roof, floor and thickness for seam and ply. Coal quality parameters are modelled by ply. Building the HARP model from the resource grids allows mine planning assumptions to be applied to the resource grids, without changing them. The ROM HARP model contains the aggregated ply qualities, along with volume / tonnage estimates based on mining horizons (working sections). This model includes dilution, loss and moisture. Version 8.1.4 improvements allow for Run of Mine calculations to be performed on a HARP model, with no requirement for the generation of ROM grids.

 This is rotated view of the North Open Cut at Vale Australias Integra mine The triangulated surface is generated using pick ups by the site surveyors, which is then cut into data derived from a LIDAR scan This surface is verified and used for monthly volume calculations and mine designs

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 This slide shows a cross section through the resource grids and borehole database

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 This slide shows a HARP block model generated for the North Open cut mine area The inputs to the HARP model were from the latest site resource statement Issues with using the resource grids for detailed mine planning include: thin seams coalesce and split over a short area, causing mining, mine planning and reconciliation problems Seam dip is consistent at resource scale, however can change locally due to presence of faulting or overlying channel conglomerates Resource grids do not make allowances for loss or dilution, thus making it difficult to make accurate short term mining decisions Resource grids were clipped to a combined base of weathering and topography surface including an active pit. This caused local distortions where grid thickness and dips are either over or under estimated. This can have an effect on the generation of the HARP model. The local distortions have prompted a change in workflow, where unclipped grids are used to generate the HARP model. All material above the base of weathering can then be assigned to overburden.

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 Following on from the last slide, the thin seams coalesce and split over the deposit Two end of month surfaces (green and blue) are shown to illustrate the complexities of mining multiple thin seams This diagram shows a section view along strike of the north open cut, the thickest ply (red) is approximately 1.8m Section width is ~500m

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 Diagrammatic representation of the local seam splitting and coalescing found at Integra Although exploration boreholes are sufficient to allow most plies to be classified as either Measured or Indicated, there is significant variation observed once the coal is uncovered This can be seen in the initial photo of the South Open Cut high wall

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 While this method is effective, in the previous method you have to apply the same aggregation rules across the entire model. In the new version, the rules can be restricted allowing different parameters to be applied to each pit or even each strip as required. A large number of grids are generated through this process, effectively creating a new ROM grid for every quality that is required (i.e. a minimum of Relative Density, Raw Ash, Inherent Moisture, Total Sulphur, Specific Energy, Product Ash, Product Yield etc). This means that at least 7 quality grids are generated for every ply (7x70=490!). Additional grids are also created for the ratio and burden calculations for each ply. Unless a strict filing system and file nomenclature is followed, there are often unintended consequences that occur when a completely new series of grids are generated, thus the perennial question to the site geo Im confused, so which grids should actually I be using?

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 The new ROM modelling tools available in 8.1.4 allow for mining assumptions to be applied to the block model, thus there is no requirement for a new set of grids to be produced. A new HARP model is generated during the process, simplifying the number of models generated and allowing for a clear audit trail. The speed at which the HARP models may be generated allow for scenario testing (such as re-running the ROM model after the monthly reconciliation process has been completed, thus checking the quality and mining parameters used).

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 The new process available in 8.1.4 The following two slides are cross sections through the HARP ROM model for Integra North Open Cut (same location as per slides 12 and 13)

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 Integra North Open Cut section 1 down dip This section illustrates the working sections derived by applying the quality and mining parameters. The thinner seams have been combined into working sections or set to zero thickness as per the mine planning assumptions. An end of year surface has been include for reference, the resource grids were clipped to a combined weathering and topography at the time of modelling (nb a better outcome is generally achieved by using resource grids that are not clipped to a surface).

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Integra North Open Cut section 1 along strike

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 The ease of interrogation of the model allows for better informed mine planning decisions Examples of where this can be used at the Integra Open Cut include: Improved coal product allocation at the short term planning scale Improved understanding of working section volumes and qualities Assist with reconciliation processes Scenario modelling may be completed to test the sensitivity of mining parameters

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 One suggested improvement on this process is to add a Block Selection option to enable ROM modelling over specific pit areas (such as by pit, strip or fault block).

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