Part 2

COAL RESERVE REPORT OF

COC 176,
LINGIG, SURIGAO DEL SUR
COAL PROJECT

Prepared By:

Cresencio A. Sosa
Licensed Geologist
PRC Lic. No.: 989

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 COAL RESERVE REPORT OF COC 176,
LINGIG, SURIGAO DEL SUR

TABLE OF CONTENTS Page

10.0 IN-SITU COAL RESERVES..3

10.1 Parameters Used for Calculation

10.2 Methodology for Calculation

10.3 Areas of Influence for Coal Resource Coal Reserve Calculation

11.0 CONCLUSIONS AND RECOMMENDATIONS.4

TABLES5

Table 6 Coal Resource Reserve COC 176

FIGURES.7

Figure 6a-6f Lay-Out of Area of Influence, By Seam

Figure 7a-7d Block Reserve Calculation for PNOC-CC DDH

Figure 8 Outcrop Block Reserve Calculation

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10.0 IN-SITU COAL RESERVES

10.1 Parameters Used for Calculation

For the purpose of determining the coal reserves of COC 176, a cut-off coal
thickness of 0.50m and above was used. Coal blocks were delineated on a
seam by seam fashion with coal block boundaries defined by faults and seam
outcrop/subcrop line.

The COC 176 coal resources-reserves were calculated on the basis of the
criteria given below:

A. Coal Resources

Relative density, 1.30

Minimum mining (true) thickness, 0.50m
Area of Influence from point of measurement (radius in meters)
o Measured 100m (red color in section)
o Indicated 200m (blue color in section)
o Inferred 250m (green color in section)

For drillholes,
Intercept of coal seam in two adjacent drill holes + surface outcrop,
considered as Measured.
Intercept of coal seam in 1 drill hole + known surface outcrop,
considered as Measured.
Intercept of seam in 1 drill hole without adjacent outcrop,
considered as Indicated.
Outcrop samples are considered measured when a confirmatory
drilling is present adjacent within 200 meters from point of
sampling.
Outcrop samples are considered indicated when no confirmatory
drilling is present adjacent within less than 200 meters from point
of sampling.

B. To convert Coal Resources to Coal Reserves

Measured + 2/3 of Indicated x 0.60% recovery for Underground

Mining = In-Situ/Mineable Reserve.

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 10.2 Methodology for Calculation

The methodology employed for the calculation of coal resources-coal reserves

are volumetric calculation in combination with geo-statistical analysis, seam
modeling and block modeling, all in GEMS environment. Final drawings, figures
and plates were generated using AutoCAD and CorelDraw Technical Suite X7.

Coal Reserves can be classified under two (2) types: (1) reserves calculated
from drillhole intercepts, and (2) reserves calculated from outcrops.

Coal reserves calculated from drillholes representing Seams 4, 3A, 3, 2A, 2 and
1 totals 1.56MMT (million metric tons).

Coal reserves calculated from outcrops mapped from the four (4) coal blocks
representing Seams 4, 3A, 3, 2A, 2 and some unnamed seams totals 0.94MMT.

Total coal reserve of COC 176 at the time of this writing is about 2.5MMT; Table
6 shows the breakdown of coal reserves for each seam.

10.3 Areas of Influence for Coal Resource Coal Reserve Calculation

Calculation of coal resources - coal reserves adheres to PMRC, JORC and DOE
standards for coal reporting. The constraints and parameters set-out in Item
7.1 were strictly observed in all of the modeling and calculation routines.

Figures 6a to 6f show the areas of influence for the coal intercepts from
drillholes for each seam calculated. Figures 7a to 7d show the cross-section
between drillholes and the radius of influence used to constrain the resource
calculation.

The area of influence for the calculation of coal reserves for the coal outcrops
of various seams is shown in Figure 8.

11.0 CONCLUSIONS AND RECOMMENDATIONS

In-situ reserves of 2.5MMT of Mineable Reserves have been delineated based on

a minimum mineable seam thickness of 0.5m.

Seam 4 is persistent in Badiong and Middle Mekoupe area. The seam is generally
well developed except in the southern part where it has deteriorated into dull,
interbanded coal. All the other coal seams, Seams 3, 3A, 2, 2A and 1 are located
in Middle Mekoupe. These coal seams are all amenable to underground mining.
However, for the purpose of this application for conversion, Seam 4 which has an
average true thickness of 1.40m is targeted for development and production by
underground mining method.

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Many areas with coal outcrops can be mined either as underground and open cut
but on a small-scale basis only, or as camote mining style.

Prepared By : Noted By:

Cresencio A. Sosa Juanito A. Manzano, Jr

Licensed Geologist VP for Exploration

PRC Lic.No.: 989 YMRI

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 TABLES

6|Page
7|Page
Table 6
YOLO MINING RESOURCES INCORPORATED
CALCULATION OF COAL RESERVE
COC 176 - COAL BLOCKS 372, 373, 12 & 13

1. DRILLHOLES
COAL RESOURCE COAL RESERVE
SEAM CODE AVE. TRUE THICKNESS MEASURED INDICATED TOTAL INFERRED PROVED PROBABLE TOTAL
SEAM 4 1.4 320,452 750,075 1,070,528 202,471 492,301 150,015 642,317
SEAM 3A 0.7 56,820 148,853 205,672 93,764 93,633 29,771 123,403
SEAM 3 0.5 20,856 47,896 68,752 34,088 31,672 9,579 41,251
SEAM 2A 0.6 114,361 255,645 370,006 114,029 170,875 51,129 222,004
SEAM 2 1.1 134,331 319,691 454,022 187,295 208,475 63,938 272,413
SEAM 1 1.2 115,457 317,998 433,455 191,897 196,473 63,600 260,073
TOTAL 762,277 1,840,158 2,602,434 823,545 1,193,429 368,032 1,561,461

2. OUT CROP
COAL RESOURCE COAL RESERVE
SEAM CODE AVE. TRUE THICKNESS MEASURED INDICATED TOTAL INFERRED PROVED PROBABLE TOTAL
SEAM 4 1.4 726,354 726,354 435,812 435,812
SEAM 3A 0.9 23,007 23,007 13,804 13,804
SEAM 3 1.2 272,303 272,303 163,382 163,382
SEAM 2A 1.2 47,369 47,369 28,421 28,421
SEAM 2 0.7 97,626 97,626 58,576 58,576
SEAM unkown 1.2 404,992 404,992 242,995 242,995
TOTAL 1,571,652 1,571,652 942,991 942,991

GRAND TOTAL 1,193,429 1,311,023 2,504,452

SAY (in Metric Tons) 1,190,000 1,310,000 2,500,000
 FIGURES

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9|Page
Lay-out of Area of Influence
DDH Coal Seam Estimate

MKD-10 4
A
12
3

MKD-08 MKD-09
4
2
3

4
2

MKD-12
MKD-01

4
12
3

MKD-11

MKD-05

MKD-07

MKD-04

MKD-06

MKD-03

MKD-02

Fig. 6a. Seam 4 Drawn By: Cris Sosa

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Lay-out of Area of Influence
DDH Coal Seam Estimate

MKD-10 4
A
12
3

MKD-08 MKD-09
4
2
3

4
2

MKD-12
MKD-01

4
12
3

MKD-11

MKD-05

MKD-07

MKD-04

MKD-06

MKD-03

MKD-02

Fig. 6b. Seam 3 Drawn By: Cris Sosa

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Lay-out of Area of Influence
DDH Coal Seam Estimate

MKD-10 4
A
12
3

MKD-08 MKD-09
4
2
3

4
2

MKD-12
MKD-01

4
12
3

MKD-11

MKD-05

MKD-07

MKD-04

MKD-06

MKD-03

MKD-02

Fig. 6c. Seam 3A Drawn By: Cris Sosa

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Lay-out of Area of Influence
DDH Coal Seam Estimate

MKD-10 4
A
12
3

MKD-08 MKD-09
4
2
3

4
2

MKD-12
MKD-01

4
12
3

MKD-11

MKD-05

MKD-07

MKD-04

MKD-06

MKD-03

MKD-02

Fig. 6d. Seam 2 Drawn By: Cris Sosa

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Lay-out of Area of Influence
DDH Coal Seam Estimate

MKD-10 4
A
12
3

MKD-08 MKD-09
4
2
3

4
2

MKD-12
MKD-01

4
12
3

MKD-11

MKD-05

MKD-07

MKD-04

MKD-06

MKD-03

MKD-02

Fig. 6e. Seam 2A Drawn By: Cris Sosa

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Lay-out of Area of Influence
DDH Coal Seam Estimate

MKD-10 4
A
12
3

MKD-08 MKD-09
4
2
3

4
2

MKD-12
MKD-01

4
12
3

MKD-11

MKD-05

MKD-07

MKD-04

MKD-06

MKD-03

MKD-02

Fig. 6f. Seam 1 Drawn By: Cris Sosa

 900.0

800.0

15 | P a g e
641000.0 E
641500.0 E
642000.0 E
642500.0 E
643000.0 E
700.0

600.0

500.0

400.0

300.0 MKD-10 MKD-08

200.0 1.75 4
Seam 4 0.32 4L
0.80 3A

0.54 3
Seam 4
Seam 2A 1.52 4
100.0 0.12 4L 0.90 2A
0.13 3A
1.65 2 Seam 3A
0.02 1A Seam 3
0.59 2A 0.70 1
Seam 2A
0.0
Seam 2
Seam 1A

lt
lt

-100.0

F au
Fau

io ng
oupe

B ad
-200.0
e Mek
Middl

SECTION ALONG MKD 10 & 08

-300.0

-400.0

-500.0

-600.0

-700.0

-800.0

Figure 7a. Reserve Computation for MKD-10 and MKD-08 Section Drawn By: Cris Sosa
 900.0

800.0

641000.0 E
642500.0 E

641500.0 E
642000.0 E

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700.0

600.0

500.0

400.0

Mi
dd
MKD-11

le
Me
300.0
MKD-08

ko
up
eF
200.0 1.75 4

au
0.32 4L

lt
0.80 3A
lt

1.46 4
Seam 4 0.28 4L
au

0.57 3A 0.54 3
F

100.0 Seam 3A 0.13 3

Seam 2 0.90 2A
pe

1.65 2

0.70 2A
kou

0.02 1A
Seam 2A 0.88 2 0.70 1
Me

0.0 Seam 2 0.50 1A

1.85 1
le

Seam 1A
dd

Seam 1
Mi

-100.0

SECTION ALONG MKD 11 & 08

-200.0

-300.0

-400.0

-500.0

-600.0

-700.0

-800.0

-900.0

Figure 7b. Reserve Computation for MKD-08 and MKD-11 Section Drawn By: Cris Sosa
 900.0

800.0

640500.0 E
641000.0 E
641500.0 E
642000.0 E
642500.0 E

17 | P a g e
700.0

600.0

500.0

400.0

MKD-12 MKD-10
300.0

200.0

1.52 4
100.0 0.12 4L
0.13 3A
1.26 4
Seam 4 0.05 4L
0.05 3A
0.59 2A
Seam 2A
0.03 3
0.0
0.48 2A
0.12 2

ult
-100.0

Fa
ng
dio
Ba
-200.0

-300.0

SECTION ALONG MKD 12 & 10

-400.0

-500.0

-600.0

-700.0

-800.0

-900.0

Figure 7c. Reserve Computation for MKD-12 and MKD-10 Section Drawn By: Cris Sosa
 900.0

18 | P a g e
800.0

640500.0 E
641000.0 E
641500.0 E
642000.0 E
642500.0 E

700.0

600.0

500.0

400.0
MKD-11
MKD-12
300.0

200.0
Seam 4
1.46 4
0.28 4L
0.57 3A

100.0 0.13 3

1.26 4 Seam 4
0.05 4L 0.70 2A Seam 3A
0.05 3A 0.88 2

0.50 1A
0.0 0.03 3 1.85 1 Seam 2A
ult

ult
0.48 2A Seam 2
0.12 2
Seam 1A
e Fa

Seam 1
p

ng Fa
-100.0
kou e

Ba dio
-200.0
le M
d
Mid

-300.0

-400.0 SECTION ALONG MKD 12 & 11

-500.0

-600.0

-700.0

-800.0

Figure 7d. Reserve Computation for MKD-12 and MKD-11 Section Drawn By: Cris Sosa
 MOC-23
888500.0Y 888500.0Y

639500.0 X
640000.0 X
640500.0 X
641000.0 X
641500.0 X
642000.0 X
642500.0 X
643000.0 X
643500.0 X
644000.0 X
644500.0 X
645000.0 X
645500.0 X
646000.0 X

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MOC
-22

888000.0Y MOC-21 888000.0Y

Block1A- Seam4

MOC
-19

MO
C-20

Block 1- Seam2

MOC-42

MOC-18 MOC-39 MKO-26

887500.0Y Block1 -Seam4 887500.0Y

MOC-38
MKO-17
MKO1
-3

MOC
-37
Block2- Seam2

MOC-24

MOC-17 MOC-40
4 MOC-25
am
-Se
3A
Block
MOC-16 MOC-14

MOC-15
Block4A -Seam3
MKO-11
MOC-41 MOC-13
887000.0Y MKO1
-2 887000.0Y
Block 3A -Seam2 Block4A - Seam4

MOC
-31

MOC-01

886500.0Y 886500.0Y
MKO-09
MKO-10
MOC-11 Block5A- Seam2A MOC-02
MOC1
-0 MKO-08
MOC-12 MKO-07
MOC-03
Block5A- Seam4
Block5A- Seam4
Block 5A-Seam3

MOC
-08 MKO0
-5 MKO-06
MKO0
-1
MKO-04
MOC0
-7
MOC-09 MKO-03
Block6 -Seam4
Block6 -Seam3A MKO-02

MO
C-06

886000.0Y 886000.0Y
Block7- UnnamedSeam
MOC-04
MOC-05

Bblock8- UnnamedSeam

885500.0Y 885500.0Y

885000.0Y MOC-30 MOC-29

885000.0Y

Block9 -Unnamed Seam

MO
C-26

MOC-28 MOC-27

Block12A - Unnamed Seam

884500.0Y 884500.0Y

MOC-32

MOC-36
MOC-33
MOC-34

MOC3
-5

639500.0 X
640000.0 X
640500.0 X
641000.0 X
641500.0 X
642000.0 X
642500.0 X
643000.0 X
643500.0 X
644000.0 X
644500.0 X
645000.0 X
645500.0 X
646000.0 X

884000.0Y 884000.0Y
Block 12- Seam4

Figure 8. Outcrop Block Reserve Computation Drawn By: Cris Sosa

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