East kazakhstan territorial administration of geology and earth interior development (ta “Vostokkaznedra”)

070004 Ust-Kamenogorsk XX, XXXXXXXXX Str.

(8-3232) XX-XX-XX, XX-XX-XX

fax (8-3232) XX-XX-XX

e-mail: vknedra_common@ukg.kz

6. №16-10-728

Information on Kenderlykskiy coal – shale field

Producing sediments form a syncline of north-west spread (11x24km) with the angles of dip of 15- 25° (in the south-west part) to 50-75°. Coals are defined as middle-upper bedding carboxylic (Kenderlykskiy series), upper bedding-Permian (akkolkanskiy series) and upper bedding Triassic (talagoiskiy series) sediment. Kenderlykskit field coals are thermal coals, and coals of kenderlykskiy and talagoiskiy series can be used as raw materials in semi carbonization and gasification.

Attributes of GD type coals: ash percentage – 26,7%, total sulfur – 0,12 – 0,32%, moisture – 9,8 – 24,6%, volatile matter – 38,2 %, combustion value - 5-6 thous. Large calories per kilogram, density - 1,7 gr/m³.

Field resources on January 1, 2005 were: categories A+B – 1660 thous. ton, A+B+C1 – 17590, 3thous. ton, C2 – 8534,4 thous. ton.

The field is composed of Karaungur, Saikan and Akkoin coal sites, shale oil sites 1 and 2, and brown coal.

Expected resources of black coal of category R1 within 300 m. depth are 100 mln. tons, brown coals of categories R1 + R2 - 800 mln. tons.

Karaungur site

Coal layers are tracked 300 m. deep and are not contoured. There are 5 layers of mean depth (top-down): 14,6m., 6,1m., 1,2m., 4,0m., 0,9m. The layers are disconnected. Layers’ angle of dip is 30-65°, the bedding is monoclinal.

By Competent Authority decision (Protocol ЭК МЭМР №6 of 26.09.2002) the right for earth interior development is assigned to LLC “Karaungur” (Ust-Kamenogorsk, General Manager Surov Yevgeniy Georgiyevich). A corresponding Addendum № 1017 is made.

By Competent Authority decision (Protocol ЭК МЭМР №9 of 07.05.2003), the exploration period was extended to 31.12.2003. A corresponding Addendum № 1209 of 25.08.2003 with a work program for extended exploration period was made.

Exploration is completed; the reserves are accounted for and proved by the Land Tenure State Committee of the Republic of Kazakhstan. Coal stocks are accounted by the state balance in the following amounts: category C1 – 4,9 mln. tons, category C2 –7,1 mln. tons, off-balance – 2,2 mln.tons, expected reserves of category R2 - 3,5 mln. tons. The Competent Authority made a decision to start the stage of production. (Protocol ЭК МЭМР №6 of 08.04.2004) In 2004 and the first quarter of 2005 there were no field works carried out. Production Contract was prepared, and the production technical design is being developed.

Saikan site

There are 7 layers on this site, the mean depth of the layers is (top-down): 4,9m., 2,0m., 10,32m., 1,8m., 1,1m., 0,3m., 1,5m. The layers are disconnected.

On January 1, 2005 the balance reserves were: categories A+B+C1 – 12663,0 thous. tons, C2 – 1400 thous. tons.

RK government assigned the right for Saikan site and Kenderlykskiy coal shale field development for 20 year period to ZDP “Kwarz” (Almaty, President Ayupova Aynure Khusainovna, Zaisan representative Dudnik Anatoliy Vassilyevich) – License MG № 41 of December 9, 1995. The allotment is 1, 70 km².

In effect, the 2005 coal production was 46 thous. tons of 50 thousand tons concerted.