Quinsam Coal Corporations Quarterly Report (July 1 - September 30) For Effluent Permit PE: 7008 Environmental Department

Transcription

1 Quinsam Coal Corporations Quarterly Report (July 1 - September 30) 2017 Quinsam Coal Corporations Quarterly Report (July 1 - September 30) For Effluent Permit PE: 7008 Environmental Department 0

2 Quinsam Coal Corporations Quarterly Report (July 1 - September 30) 2017 TABLE OF CONTENTS Table of Contents... 1 Summary of Events for the Second Quarter: Non-Compliance Events Water Management Systems North Water Management Sedimentation Pond 4 (WD) South Water Management - Sedimentation Pond 1 (SPD) South (7SSD) Water Management Receiving Environment Water Quality Lakes Streams and Rivers Groundwater Long Lake Seep Treatment (LLST) System and 2-South Pit: Long Lake Seep Treatment System Methods and Limitations Quality Assurance Quality Control Conclusion Table 1: Summary of Water Quality Guideline Observations at Receiving Environment Monitoring Locations, Initial Zone of Dilution Site and Long Lake Seeps... 5 Table 2: Summary of Water Quality Guideline Observation for Lakes... 6 Table 3: Summary of Guideline Observations for LLE, Rivers and Streams... 7 Table 4: List of Groundwater Wells & Underground Sumps Monitored in Quarter Table 5: Summary of Ex-situ Groundwater Well Observations Compared to CSR-AW Standards... 9 Table 6: Long Lake Seeps Appendix I: Tables

3 Quinsam Coal Corporations Quarterly Report (July 1 - September 30) 2017 SUMMARY OF EVENTS FOR THE SECOND QUARTER: This quarter Quinsam Coal Corporation (QCC), transitioned from operating in a care and maintenance mode to rehabilitation work focusing on 2-North mine belt and infrastructure. Coal production commenced on September 27 th, All environmental monitoring obligations as per the Effluent Permit 7008 (PE-7008) remain unchanged. During the 2nd Quarter (Summer 2017), the receiving environment monitoring program for both lakes and river/stream stations was completed. Quarterly monitoring was performed for groundwater quality, effluent and in-mine releases. The Annual Water Quality Monitoring Report including the sediment and benthic monitoring results was submitted on August 15 th, All other environmental sampling and obligations pertaining to permit PE-7008 was completed. All permitted parameters were below permit limits at all authorized discharge points (Settling Pond #1, Settling Pond #4 and 7SSD). As displayed in Appendix I, Table 1 parameters observed to be above British Columbia Water Quality Guidelines for Protection of Aquatic Life occurring in the receiving environment include: total arsenic, dissolved cadmium, total & dissolved iron, dissolved sulphate, ph, hypolimnetic dissolved oxygen and total zinc Monitoring of groundwater included 13 wells, 1 underground sump (6M2N) and 2 dewatering wells pumped to surface (5 Mains #2 and 1 Mains 2-North). The ex-situ groundwater wells are those wells outside of the mine pool that have the potential to impact aquatic life. These wells are compared to British Columbia Contaminated Sites Regulations Freshwater Aquatic Life Schedule 6 (CSR-AW). Those parameters that exceeded the Guidelines include dissolved arsenic and sulphide as hydrogen sulphide (H 2 S). Exceedances are displayed in Appendix I, Table 2 and all other results are displayed in Tables 54 and 55. In addition to the aforementioned monitoring, the Quinsam Environmental Department conducted routine inspections and completed any required maintenance of the water management structures. A list of acronyms associated with this report is available in Appendix I with Tables 1 and 2 displaying a summary of those parameters that exceeded the guidelines throughout the quarter. Appendix I, Tables 3-72 display all water quality results pertaining to Quarter 2, July 1 st, 2017 through September 30 th,

4 Quinsam Coal Corporations Quarterly Report (July 1 - September 30) NON-COMPLIANCE EVENTS There were no reportable spills this quarter or non-compliance events. 2.0 WATER MANAGEMENT SYSTEMS 2.1 NORTH WATER MANAGEMENT SEDIMENTATION POND 4 (WD) Measured discharge at Settling Pond 4 occurred for 92 days during this quarter; the average flow rate was estimated above the threshold for composite TSS sampling (daily max flow above m 3 /s) throughout the entire quarter. At this time QCC has not been able to collect the discharge data from the flow metre. This data will be submitted with the next quarterly report. This has not resulted in any missing flow data. A daily composite for total suspended solids was collected every day this quarter. Dewatering of the underground 2-North mine continued throughout this quarter; water was pumped from 5 Mains and 1Mains 2-North into Brinco Brook. Brinco Brook mixes with water from the 2-North Portal Sump and flows into Settling Pond 4 where it is released to the environment. Historically this water would be used for coal processing activities. As part of putting the mine into care and maintenance, the 2-North 6 Mains underground pumping system was removed in May, This has aided in reducing discharge from WD. All parameters permitted to discharge at WD remained below permit limits. Sulphate concentrations averaged 643 mg/l; TSS remained low with most samples below detection limits of 4.00 mg/l, averaging 4.11 mg/l and ph remained neutral. A full set of results is displayed in Appendix I, Tables 22, 25 & SOUTH WATER MANAGEMENT - SEDIMENTATION POND 1 (SPD) No discharge occurred during this quarter from SPD. All permitted parameters applied to SPD discharge were sampled from the ponded water and remained below permit limits. Monthly sulphate concentrations averaged 200 mg/l, TSS remained below detection limits in most samples with an average of 5.76 mg/l and ph remained neutral. A full set of results is displayed in Appendix I, Table 3. 3

5 Quinsam Coal Corporations Quarterly Report (July 1 - September 30) SOUTH (7SSD) WATER MANAGEMENT Discharge did not occur during Q2 at 7SSD. During spring, fall and winter the sedimentation pond outflow is controlled by pumping water accumulated in the pre-settling pond to the 7-South Portal Sump. This procedure reduces discharge, decreasing the overall parameter loading and the potential for adverse aquatic impact in the receiving environment; as the biological availability for parameters of concern is much lower than under constant discharge conditions. Pumping to the 7-South Portal Sump did not occur during this quarter as there was limited precipitation received. Monthly samples were obtained from the ponded water (7SSD) and the results are available in Appendix I, Table 30. This quarter, the corresponding downstream receiving environmental sites 7S and Lower Wetland Outlet were dry. A quarterly sample was collected from the 7-South Portal Sump and is available in Appendix I, Table 18. The water from this sump is normally pumped to 5-South Mine Pool via borehole QU Pumping from the sump to QU05-13 did not occur this quarter as there was limited precipitation. 3.0 RECEIVING ENVIRONMENT WATER QUALITY Preamble Water Hardness For the purposes of this report, the water quality guideline(s) (WQG) for hardness dependent parameters has been derived using site appropriate background values (i.e. monitoring location WA hardness ~30mg/L). Quinsam Coal has adopted this approach to provide a conservative comparison of receiving environment water quality. Parameters of interest at the Iron River stations whose WQG(s) are hardness dependent are compared to the average hardness from Iron River Site 1 (IR1); which is upstream of any mine influence. The average hardness concentration is calculated for the 5 in 30 sampling event (i.e. summer), resulting in dynamic WQG concentrations. For the summer sampling season an average hardness of 30 mg/l was used to derive the hardness dependent guidelines for simplicity purposes. The table below summarizes the parameters above Provincial water quality guidelines for all sites this quarter. This table is also available in Appendix I, Table 1. 4

6 Quinsam Coal Corporations Quarterly Report (July 1 - September 30) 2017 Table 1: Summary of Water Quality Guideline Observations at Receiving Environment Monitoring Locations, Initial Zone of Dilution Site and Long Lake Seeps SUMMARY OF WATER QUALITY GUIDELINE OBSERVATIONS AT RECEIVING MONITORING LOCATIONS Site Code & Parameter EMS ID & Site Name Guideline Limit Result Date Guideline Sampling Events Exceeding Guideline Depth (mg/l, ph units) E No Name Lake (NNL) NNL metres ph-f Aug. 11 & 29 Min (6/57) Depths profiled during summer E Long Lake Middle (LLM) E Middle Quinsam Lake (MQL) E Lower Quinsam Lake (LQL) LLM metres Hypolimnetic DO 3 mg/l minimum June through August Summer 5 in 30 Min (32/35) Depths profiled below 13 m (hypolimnion zone) MQL 4 m Cd-D Aug. 10 M 1/5 weekly samples LQL ( metres) Hypolimnetic DO 3 mg/l minimum June through August 0.00 to 2.92 Summer 5 in 30 Min (25/34) Depths profiled below 10 m (hypolimnion zone) LQL 1MB Fe-T Sep. 15 M 1/5 weekly samples LQL 1MB Fe-D Summer 5 in 30 M Summer 5 in 30 E Long Lake Entry (LLE) -Last wetland South Water Management flows into prior to entering Long Lake. Considered an initial dilution zone (IDZ) LLE SO4-D* 128 >128 Summer 5 in 30 A Fe-D Jul. 17 M Monthy sample Fe-T Jul. 17 M Monthy sample All results were above 128 flow ceased from month of August. Flow was extremly low inceasing sulphate concentrations. E Quinsam River Upstream of Mining Operations (IR1) E Iron River Upstream of 7SA5 (IR6) E Iron River Upstream of 7SA5 (IR8) IR1 Zn-T Aug. 17 M 1/5 weekly samples IR6 As-T Jul 25 through Sep 27 M Summer 5 in 30 & Sep. monthly IR8 As-T Jul 25, Aug. 4 & 9 Sep. 27 M 2/5 Summer 5 in 30 & 2 Monthly E Quinsam River Downstream Site 1 (QRDS1) QRDS1 Zn-T Aug. 17 M 1/5 Summer 5 in 30 Cd-D Aug. 10 M 1/5 Summer 5 in 30 Cd-D < Aug. 14 M Detection limit set higher than guideline LLS Fe-T & 1.47 Jul. 25 & Aug. 14 M Monthy samples Fe-D , 1.48 & Jul. 25, Aug. 14 & Sep. 12 M Monthy samples (Filtered on site) E Long Lake Seeps As-T Jul. 6 M Monthy sample LLSM Cd-D < Aug. 14 M Detection limit set higher than guideline Fe-T Jul. 6 M Monthy sample Fe-D & Jul. 6 & Aug. 14 M Monthy samples (Filtered on site) For all Middle Quinsam Lake Sub-basin and Iron River results background hardness of 30 mg/l was used to calculate those parameters that are hardness dependent. *SO4 at LLE was calculated using a rolling average. 3.1 LAKES Lake sampling commenced August 10 th following the 5 samples in 30 days approach. This program included No Name Lake (NNL), Long Lake (LLM), Middle Quinsam Lake (MQL) and Lower Quinsam Lake (LQL). Appendix I, Table 27 displays the depth profiling field results with Tables 28 through 43 displaying the water quality results compared to guidelines. 5

7 Quinsam Coal Corporations Quarterly Report (July 1 - September 30) 2017 Table 2: Summary of Water Quality Guideline Observation for Lakes SUMMARY OF WATER QUALITY GUIDELINE OBSERVATIONS AT RECEIVING MONITORING LOCATIONS Site Code & Parameter EMS ID & Site Name Guideline Limit Result Date Guideline Sampling Events Exceeding Guideline Depth (mg/l, ph units) E No Name Lake (NNL) NNL metres ph-f Aug. 11 & 29 Min (6/57) Depths profiled during summer E Long Lake Middle (LLM) E Middle Quinsam Lake (MQL) E Lower Quinsam Lake (LQL) LLM metres Hypolimnetic DO 3 mg/l minimum June through August Summer 5 in 30 Min (32/35) Depths profiled below 13 m (hypolimnion zone) MQL 4 m Cd-D Aug. 10 M 1/5 weekly samples LQL ( metres) Hypolimnetic DO 3 mg/l minimum June through August 0.00 to 2.92 Summer 5 in 30 Min (25/34) Depths profiled below 10 m (hypolimnion zone) LQL 1MB Fe-T Sep. 15 M 1/5 weekly samples LQL 1MB Fe-D Summer 5 in 30 M Summer 5 in 30 Noteworthy observations resulting from the lake monitoring program include: Average sulphate concentrations Measured below the water quality guideline (128 mg/l) on all lakes at all depths. Resulted in mg/l and mg/l at 9 metres and 1 metre from bottom (1mb), respectively on Long Lake during summer sampling. These results were similar to the spring 5 in 30 averages of mg/l and mg/l at 9 metres and 1 metre from bottom (1mb) respectively. This indicates there is limited mixing between the water columns during these seasons at depth and limited groundwater inputs. At surface (1 and 4 metres) on Long Lake increased from 33.8 mg/l in the spring to mg/l at 1 metre and mg/l to mg/l at 4 metres. There was no flow from LLE into Long Lake; however, the Middle Seep (LLSM) flowed up until early August this year. Decreased at depth from 92 mg/l to 58.3 mg/l on Middle Quinsam Lake. Concentrations were low throughout the Lake during all sampling events. Higher at surface than at depth on Lower Quinsam Lake ranging from 26 mg/l to 12 mg/l from 1m to 1mb. ph in NNL Reduced exceedances were observed only 6 values fell below the minimum guideline of 6.5 at depths of 9 to 11.5 metres, resulting in a minimum value of The majority of exceedances (4) were encountered on the first week of sampling. Hypolimnetic Dissolved Oxygen Long Lake at 13 metres to 1mb yet no other exceedances were experienced as a result. Lowered Quinsam Lake at 10 metres to 1mb, exceedances of both total and dissolved iron was observed. Dissolved Cadmium Elevated above guidelines at 4 metres during 1 sampling event on Middle Quinsam Lake. 6

8 Quinsam Coal Corporations Quarterly Report (July 1 - September 30) STREAMS AND RIVERS The 5 samples in 30 days receiving environment program at river and stream sites commenced August 4 th and concluded August 30th, Appendix I, Tables 44 through 53 display water quality results from this program compared to water quality guidelines for the Middle Quinsam Lake Sub-basin and Iron River. Monitoring stations captured within the Middle Quinsam Lake sub-basin include: Middle Quinsam Lake Inlet (WA), Middle Quinsam Lake Outlet (WB), No Name Lake Outlet (NNO), Long Lake Outlet (LLO), Quinsam River Downstream 1 (QRDS1), 7-South Quinsam River (7SQR), Quinsam River downstream of the confluence with Iron River (IRQR). Monitoring stations on the Iron River include: Iron River Upstream of Mining Operations (IR1), Iron River Upstream of future 7-South Area 5 development (IR6), and Iron River above the confluence with Quinsam River (IR8). While monitoring location LLE is considered the initial dilution zone (for water quality evaluation purposes) it is important to note that this location represents the uppermost extent of an initial dilution zone for the South water management system discharge into Long Lake. Table 3: Summary of Guideline Observations for LLE, Rivers and Streams E Long Lake Entry (LLE) -Last wetland South Water Management flows into prior to entering Long Lake. Considered an initial dilution zone (IDZ) E Quinsam River Upstream of Mining Operations (IR1) E Iron River Upstream of 7SA5 (IR6) E Iron River Upstream of 7SA5 (IR8) LLE SO4-D* 128 >128 Summer 5 in 30 A Fe-D Jul. 17 M Monthy sample Fe-T Jul. 17 M Monthy sample IR1 Zn-T Aug. 17 M 1/5 weekly samples All results were above 128 flow ceased from month of August. Flow was extremly low inceasing sulphate concentrations. IR6 As-T Jul 25 through Sep 27 M Summer 5 in 30 samples & 1 monthly sample IR8 As-T Jul 25, Aug. 4 & 9 Sep. 27 M 2/5 Summer 5 in 30 & 2 monthly samples E Quinsam River Downstream Site 1 (QRDS1) QRDS1 Zn-T Aug. 17 M 1/5 Summer 5 in 30 Cd-D Aug. 10 M 1/5 Summer 5 in 30 Noteworthy observations resulting from the river/stream monitoring program include: The water quality at most stations remained below guideline levels during the sampling events; exceedances occurred at LLE, IR1, 1R6, IR8 and QRDS1. 7

9 Quinsam Coal Corporations Quarterly Report (July 1 - September 30) 2017 Rolling average sulphate concentrations at LLE were elevated during all sampling events. Total and dissolved iron was elevated during July when flow was lowest; there was no flow in August. Average concentrations of total arsenic were elevated in the Iron River (IR6 & IR8) above the average guideline of mg/l during summer low flow. Total zinc was elevated (0.05 mg/l) in the Iron River at IR1 during 1 sampling event and on the Quinsam River at QRDS1 during 1 sampling event. Zinc was not elevated downstream on the either river. Dissolved cadmium was elevated during 1 sampling event on the Quinsam River at QRDS1. Cadmium was also elevated at 4 metres on Middle Quinsam Lake. 4.0 GROUNDWATER Groundwater wells are categorized as either in-situ or ex-situ ; the definition for each is as follows: In-situ: groundwater wells located within the mine workings (disturbance footprint) and therefore represent water accumulated within the mining void. In the absence of groundwater well samples, underground sump samples are used for comparison. Ex-situ: groundwater wells located outside the mine workings (disturbance footprint) which reflect water quality flowing from the mine void towards the receiving environment. This also includes baseline and background (up-gradient of workings) groundwater wells. The groundwater wells outside the mine footprint (ex-situ) are compared to the British Columbia Contaminated Site Regulation (CSR) (BC reg.37/96. O.C. 1480/96), including the amendments (343/2008 January 1, 2009) describing water quality standards for fresh water Aquatic Life (AW). The aquatic life standard assumes that a minimum 1:10 dilution is available for groundwater discharged to a freshwater system; together, they are referred to as CSR-AW. Table 4 below lists the groundwater wells and sumps monitored during Q2. Table 4: List of Groundwater Wells & Underground Sumps Monitored in Quarter 2 Area Ex-situ In-situ 7- South QU08-13 A & B QU14-10 River Barrier Pillar QU11-09 S QU11-09 M QU11-05 S & D 2-North QU08-21 GS 1 Mains 2-North (1M2N), 5 Mains #2 (5M#2), QU10-13 D 6 Mains 2 North (6M2N) Sump 2-3 South MW00-4, QU11-11 and MW00-2, 8

10 Quinsam Coal Corporations Quarterly Report (July 1 - September 30) 2017 Table 5: Summary of Ex-situ Groundwater Well Observations Compared to CSR-AW Standards Contaminted Sites Regulations -Freshwateions -Freshwater Aquatic Life ( CSR-AW ) Exceedances in Ex-Situ Grou n Ex-Situ Groundwater Wells Well ID: QU0821GS QU1105S QU1105S QU1109S QU0813A QU0813A QU0813B Date 26/Sep/17 26/Sep/17 26/Sep/17 22/Sep/17 25/Sep/17 25/Sep/17 25/Sep/17 Sample Class M M M M M Rep M Parameter Units CSR-AW As-D mg/l S2 as H2S mg/l Noteworthy observations resulting from the ex-situ groundwater monitoring program include: Arsenic was elevated above the CSR-AW (0.05 mg/l) in the groundwater from 7-South, 3-North and River Barrier Pillar (RBP). This is due to the geological features and elevated arsenic found in the host rock geology i.e. Dunsmuir Sandstones. Hydrogen sulphide was observed to be elevated above CSR-AW (0.02 mg/l) in 7-South, 3-North and RBP. The RBP, QU11-05 D was observed to have the highest concentrations of 9.74 mg/l indicating the groundwater has low redox conditions. 5.0 LONG LAKE SEEP TREATMENT (LLST) SYSTEM AND 2-SOUTH PIT: All parameters requested in accordance with the authorization to bypass the works have been sampled following the specified frequency and procedures. Each data set was compared to the applicable permit limits for SPD discharge; results are displayed in Appendix I, Tables 9 and 14. For a comprehensive review of the LLST system performance please refer to the Appendix II. The Authorization to Bypass the Works was approved on August 25 th, On May 12 th the effluent from the treatment system pond, Sulphide Polishing Cell (SPC-EFF) was directed into the 2-South PAG-CCR facility in order to maintain a 1.5 metre water cover over the PAG- CCR during times of low precipitation. The 2-South Inflow (2SI) monitoring location was included in this quarter s data for July as this represents the location where (SPC-EFF) enters the pit. The 2-South pit was not discharging to 3-South pit all quarter. All monitoring results are displayed in Appendix I, Tables 4, 5 and 8 through 13 including water quality monitored within 2-South pit. During July and August there was no discharge from the treatment system through SP-Eff and into BDS as a result the weekly sampling requirements from SP-Eff and BDS were not collected. A monthly sample was obtained in September at both sites once the water was redirected back through the treatment system in August. 9

11 Quinsam Coal Corporations Quarterly Report (July 1 - September 30) 2017 Table 6: Long Lake Seeps Cd-D < Aug. 14 M Detection limit set higher than guideline LLS Fe-T & 1.47 Jul. 25 & Aug. 14 M Monthy samples Fe-D , 1.48 & Jul. 25, Aug. 14 & Sep. 12 M Monthy samples (Filtered on site) E Long Lake Seeps As-T Jul. 6 M Monthy sample LLSM Cd-D < Aug. 14 M Detection limit set higher than guideline Fe-T Jul. 6 M Monthy sample Fe-D & Jul. 6 & Aug. 14 M Monthy samples (Filtered on site) The Long Lake Seeps experienced elevated total arsenic and both total and dissolved iron during all sampling events. Since QCC make the change to filtering all samples on site, dissolved iron has displayed an increase at all sites, most noticeable at the Seeps. The cadmium detection limit at the laboratory was set higher than the guideline resulting in a guideline exceedance. This has since been corrected with the analytical laboratory. 6.0 LONG LAKE SEEP TREATMENT SYSTEM In accordance with Mine Permit condition 3(b) (approving the Long Lake Seep Passive Treatment System) and the Ministry of Environment Authorization to Bypass the Works, is a report summarizing the operation of the treatment system, monitoring at the downstream site BDS, and aggregate loading into Long Lake from mine-related discharges for the second quarter (Q2) monitoring year, covering July 1, 2017 through September 30, The Long Lake Seep Passive Treatment System (LLST) consists of a series of treatment cells designed to receive mine-water pumped from the 2-South underground workings to reduce Parameters of Interest (POI) concentrations including dissolved sulphate and iron. This system was initiated as part of a remediation plan to limit localized mine-water seepage on the south-side of Long Lake as a result of subsidence caused by mining within close proximity and establishing an evident hydrologic connection. There are numerous seepage sites along this bank and are collectively identified as the Long Lake Seeps with two distinct collection sites in which samples are obtained and flows are quantified. Dewatering of the 2-South workings reduces head pressure on the south side of Long Lake and ultimately reduces seepage. The effectiveness and integrity of this system is evaluated by Quinsam Coal staff with physical inspections, monitoring flow rates and scheduled sampling of chemical and physical parameters. Analytical results provide the most effective means of evaluation and take place once per month at 6 sites associated with the treatment system. In addition to monthly monitoring for the entire treatment system, SP-Eff and BDS are monitored on a weekly basis during periods of discharge at SPD for Total Suspended Solids (TSS) and dissolved sulphate. With the addition of molasses into the BCR initiated in May 2016, additional sulphate samples are collected weekly at the inflow and BCR-Eff providing supplementary performance information. The loading assessment employs a series of calculations to determine the aggregate loading for POI including: dissolved arsenic, dissolved iron, and dissolved sulphate. This data is generated from routine water quality monitoring and flow monitoring at point source discharge locations including: the LLST, the Long Lake Seeps and Settling Pond #1 (SPD). To ensure accurate quantification, flow rates are recorded and water samples are collected at regular intervals to characterize water quality. 10

12 Quinsam Coal Corporations Quarterly Report (July 1 - September 30) 2017 This report is designed to inform governing bodies on the effectiveness of the LLST and to support Quinsam Coal s long term mitigation strategy on managing the Long Lake Seeps. Appendix I, Tables 8 through 13 display results from the treatment system. A summary of observations for Q2 includes: System flow rate was increased to 6.0 L/s on June 26, 2017 and remained there until September 13th AL and SP were bypassed on May 12 and were not evaluated until September 14th sampling event Sulphide Polishing Cell Effluent (SPC-EFF) was directed into 2-South Pit potentially acid generating coarse coal refuse (PAG-CCR) facility in order to maintain a water cover over the PAG-CCR Analytical results obtained from sampling at BDS indicate compliance with all permit limits in Q2 Sampling was not required after May 18th until September 14th as discharge from the treatment system into BDS ceased on May 12th The Long Lake Middle Seep discharged until late August 15 th A 96-hour no dilutions Rainbow Trout bioassay was performed on the seep discharge on June 20 th with 100 percent survival of all fish A full loading assessment will be assessed next quarter when the system has been discharging through the entire treatment system and loading can be accurately quantified 7.0 METHODS AND LIMITATIONS Inspections of the LLST are completed multiple times per week to ensure the system is operating as designed. Any unusual observations are noted and maintenance is conducted as needed. Once per month, physical and chemical parameters are measured and analyzed throughout 6 locations including: Water pumped into the system from the 2-South mine-pool ( inflow or INF) In the biochemical reactor (BCR) where sulphate is biochemically reduced to sulphide The sulphide polish cell (SPC) in which sulphide is sequestered by sacrificial iron The aerobic lagoon (AL) where dissolved oxygen is diffused into the water removing excess nutrients and precipitating metals The system settling pond (SP) in which suspended materials settle out A location 100m downstream of the confluence from settling pond #1 (SPD) and SP effluent mixing known as Biocell downstream (BDS) A multiparameter sonde is used by on-site personnel to obtain ph, conductivity, dissolved oxygen (DO) and oxidation reduction potential (ORP) to compliment water chemistry results analyzed by the contracted laboratory Maxxam Analytics. As complete results are obtained only once per month, it is possible that system performance is not represented completely as small biochemical and operational changes may be missed between sampling events. However, a complete dataset using monthly sampling events throughout operations since 2012 have indicated predictable trends that describe system operations and overall effectiveness. The LLST design is open to the atmosphere where it is conceivable that precipitation may dilute water within the system affecting monitoring results. Adversely, low precipitation during the summer and increased temperatures may evaporate water from the system prior to discharge resulting in higher 11

13 Quinsam Coal Corporations Quarterly Report (July 1 - September 30) 2017 observed POI concentrations and ultimately, calculated reduction efficiency. Flow rate is only captured at the pumping station into the first portion of the system and losses or gains encountered through the system aren t necessarily realized. On May 12, 2017, the two final treatment cells (AL & SP) within the LLST were bypassed and system effluents from SPC were diverted into the 2-South PAG-CCR storage facility via the inlet channel. For the purpose of this report and for simplicity in graphs, all treatment system discharges have been called SPeff. Upon diligent review of past laboratory analyses from SPC effluents, it was determined that water quality was consistently within permit limits for the South Water Management System. Three significant benefits were realized with bypass of the treatment cells including: addition of water into the 2-South PAG-CCR storage facility; reduced oxidation of sulphur compounds into sulphides; and reduced efforts in sampling and maintenance. During the warm, dry periods during the summer, water levels in the 2- South PAG-CCR storage facility decline and risk falling below the required levels needed for subaqueous PAG storage. The additional water ported from the treatment system provides additional cover into this facility. As described later in this document, sulphur bearing materials discharged into the AL typically oxidize into sulphate thus decreasing system performance. By eliminating that portion of the treatment system and sampling at the SPC effluent pipe, system performance appears to improve while providing a more representative sampling location than used before. In addition to the operational benefits realized, elimination of two treatment cells minimizes efforts in both system maintenance and sampling efforts. It is unclear whether the bypassing of these treatment cells will be a permanent change to the water management system as introduction of treatment system water into 2-South will have an effect on water balance and water quality predictions. Potential expansion of the current treatment system and future permitting of discharges from the 2 & 3 South PAG-CCR storage facilities into the No Name Lake connector stream may necessitate restarting the two treatment cells. Loading assessment results are generated using monthly averages for both flow measurements and POI concentrations. Water quality sampling is performed on weekly and monthly intervals with dissolved metals sampled monthly and sulphate sampled weekly. To ensure consistency, average monthly sulphate values are calculated using weekly results to synchronize with metal sampling. Together, flow rate (L/s) and POI concentrations (mg/l) are used to calculate overall load in kilograms (kg) for the desired parameter and time period at each point source. The equation used to quantify load is expressed as: Load (kg) = Q x T x C / 1000 Q represents the average monthly flow in L/s T represents the total time (in seconds) for the month C represents the average monthly concentration in mg/l for the parameter of interest The concentrations used for calculation may not fully represent monthly discharges as dynamic changes can occur within the system between sampling events. Concentrations are input using the instantaneous results obtained from grab samples and it is impractical to increase sampling frequency. Additionally, short-term hydrologic changes within the system may not necessarily be observed due to flow rates input as monthly averages (derived from continuous or weekly readings). The collection of dissolved metals samples throughout monitoring of the treatment system and loading calculations from July, 2013 to May 2017 was completed without the usage of on-site filtering and preservation. Upon review of water quality data at various sites, it was suspected that the usual practice of submitting raw water for the laboratory to process may not yield representative results for the dissolved 12

14 Quinsam Coal Corporations Quarterly Report (July 1 - September 30) 2017 portion of metals analysis. Numerous experiments were conducted that measured differences between laboratory filtering and on-site filtering in side by side sampling. Results indicated that many dissolved metals samples results were biased low (especially iron) when filtering was not performed immediately on site. As dissolved iron is a redox sensitive parameter, it is conceivable that dissolved iron present at the time of collection oxidizes and converts to particulate that cannot pass through the filter at the laboratory. The differences in reported iron concentrations were often significant with on-site preservation yielding values that were often hundreds of times higher than the laboratory prepared samples. This finding poses a significant concern with respect to metals loading into Long Lake from point sources used in this document and reduction within the treatment system. From May, 2017 onward, all dissolved metals samples obtained on-site are filtered using laboratory grade, disposable equipment and preserved immediately. The aforementioned limitations need to be considered when evaluating loading from a quantitative (and qualitative) standpoint. Quinsam Coal is committed to ensuring that the most reliable and accurate data is collected and continuously evaluates and improves monitoring procedures to best supplement this assessment. Examples include: strict quality control; consistent, representative sampling techniques; flow calibration and verification at measurement sites; frequent inspections at discharge locations; and removing accumulated sediment at weir devices to ensure laminar flow across monitoring structures. 8.0 QUALITY ASSURANCE QUALITY CONTROL All replicate sampling was performed in compliance with the British Columbia Field Sampling Manual for Continuous Monitoring and the Collection of Air, Air Emission, Water, Wastewater, Soil, Sediment, and Biological Samples, 2013 Edition. As per these guidelines and in accordance with the Quinsam Coal Quality Assurance/Quality Control (QA/QC) program, one field replicate sample was collected per sampling event. Relative Percent Difference, RPD values were calculated in accordance with the B.C. field sampling manual. The flow data for Settling Pond # 4 and the weather station will be submitted next quarter. Quinsam Environmental Department was not able to download the data due to technical difficulties. This has not resulted in any loss of information. Sampling location 7-South Quinsam River (7SQR) is missing dissolved metals from September 27 th as the results were not received from the laboratory during October. Quinsam is waiting for the results and will report them next quarter. CONCLUSION Quinsam Coal is dedicated to reducing the environmental impacts as a result of mining on the environment. Overall, there were few provincial water quality guideline exceedances on site and in the receiving environment this quarter. This exemplifies that the environmental management practices employed by Quinsam Coal are effective in reducing environmental impacts to the surrounding environment. In closing, we trust the information presented in this report satisfies the conditions under Effluent Permit PE Please contact the Quinsam Coal Environmental Department if you have any questions or comments. 13

15 List of Tables Table 1 Q2 Summary Table For Permit Limits and Water Quality Guidelines Table 2 Contaminted Sites Regulations -Freshwater Aquatic Life ( CSR-AW ) Table 3 Settling Pond # 1 Table 4 2 South Inflow Table 5 2 South Standpipe in 2S Pit and and 2 South Pit CCR Water Cover Table 6 2 South Culvert Table 7 3 South Pit CCR Cover Table 8 Influent for Bio-cell Table 9 Bio-cell Reactor Effluent Table 10 Sulphide Polishing Cell Effluent Table 11 Aerobic Lagoon Effluent Table 12 Settling Pond Effluent Table 13 Biocell Downstream Table Bulk Sample Pit Table 15 LLE- South End Initial Dilution Zone Table 16 Seep into Long Lake Table 17 Long Lake Middle Seep Table 18 7 South Portal Sump Table 19 Settling Pond at 7S Table 20 2-N-Portal Sump Table 21 2 North Pit Sump - CCR Water Cover Table 22 Settling Pond #4 Table 23 North Pit Culvert Table 24 Middle Point Terminal Table 25 Daily Total Suspended Solid Samples from Settling Pond # 4 Table 26 Weekly Sulphate Results & Rolling Averages Table 27 Depth Profiling - Lakes Table 28 No Name Lake 1 metre depth Table 29 No Name Lake 4 metre depth Table 30 No Name Lake 9 metre depth Table 31 No Name Lake 1 metre from bottom Table 32 Long Lake 1 metre depth Table 33 Long Lake 4 metre depth Table 34 Long Lake 9 metre depth Table 35 Long Lake 1 metre from bottom Table 36 Middle Quinsam Lake 1 metre depth Table 37 Middle Quinsam Lake 4 metre depth Table 38 Middle Quinsam Lake 9 metre depth Table 39 Middle Quinsam Lake 1 metre from bottom Table 40 Lower Quinsam Lake 1 metre depth Table 41 Lower Quinsam Lake 4 metre depth Table 42 Lower Quinsam Lake 9 metre depth Table 43 Lower Quinsam Lake 1 metre from bottom Table 44 Middle Quinsam Lake Inlet Table 45 Middle Quinsam Lake Outlet Table 46 No Name Lake Outlet Table 47 Long Lake Outlet Table 48 Quinsam River Downstream Site 1 Table 49 Iron River Upstream Site 1 Table 50 Iron River Site 6 Table 51 Iron River Site 8 Table 52 7-South Quinsam River Table 53 Iron River & Quinsam River Table 54 Groundwater Wells Table 55 Groundwater Wells Table 56 to 72 ph-cond

16 List of Acronyms P WQG Max Green Detection Limit greater than Max- WQG QA/QC CSR-AW In-Situ Ex-Situ 1mb m ND NF Permit Limits Water Quality Guidelines for Protection of Aquatic Life Exceedances Highlighted Blue Exceedances Highlighted Green Exceedances Highlighted Blue and Shaded Gray Quality Assurance / Quality Control Contaminated Sites Regulations For Protection of Freshwater Aquatic Life Within the mine pool Outside of the Mine Pool 1 metre off bottom metre No Discharge No Flow Station Type P SW MW EFF SP R Permitted Discharge Location Surface water Mine water Effluent Settling Pond Replicate Sample Notes for Calculating Averages in Tables: Calculations for averages did not include monthly samples or replicates

17 Q2 SUMMARY OF PERMIT LIMIT EXCEEDANCES & PERMIT NON-COMPLIANCES (July - September Table 2017) 1 There were no permit limit exceedances or (PLE) or Permit Non-Compliances (PNC) experienced this quarter. SUMMARY OF WATER QUALITY GUIDELINE OBSERVATIONS AT RECEIVING MONITORING LOCATIONS Parameter (mg/l, EMS ID & Site Name Site Code & Depth Guideline Limit Result Date Guideline Sampling Events Exceeding Guideline ph units) E No Name Lake (NNL) NNL metres ph-f Aug. 11 & 29 Min (6/57) Depths profiled during summer E Long Lake Middle (LLM) LLM metres Hypolimnetic DO 3 mg/l minimum June through August Summer 5 in 30 Min (32/35) Depths profiled below 13 m (hypolimnion zone) E Middle Quinsam Lake (MQL) E Lower Quinsam Lake (LQL) MQL 4 m Cd-D Aug. 10 M 1/5 weekly samples LQL ( metres) Hypolimnetic DO 3 mg/l minimum June through August 0.00 to 2.92 Summer 5 in 30 Min (25/34) Depths profiled below 10 m (hypolimnion zone) LQL 1MB Fe-T Sep. 15 M 1/5 weekly samples LQL 1MB Fe-D Summer 5 in 30 M Summer 5 in 30 E Long Lake Entry (LLE) - Last wetland South Water Management flows into prior to entering Long Lake. Considered an initial dilution zone (IDZ) E Quinsam River Upstream of Mining Operations (IR1) E Iron River Upstream of 7SA5 (IR6) E Iron River Upstream of 7SA5 (IR8) LLE SO4-D* 128 >128 Summer 5 in 30 A Fe-D Jul. 17 M Monthy sample Fe-T Jul. 17 M Monthy sample IR1 Zn-T Aug. 17 M 1/5 weekly samples All results were above 128 flow ceased from month of August. Flow was extremly low inceasing sulphate concentrations. IR6 As-T Jul 25 through Sep 27 M Summer 5 in 30 samples & 1 monthly sample IR8 As-T Jul 25, Aug. 4 & 9 Sep. 27 M 2/5 Summer 5 in 30 & 2 monthly samples E Quinsam River Downstream Site 1 (QRDS1) QRDS1 Zn-T Aug. 17 M 1/5 Summer 5 in 30 Cd-D Aug. 10 M 1/5 Summer 5 in 30 Cd-D < Aug. 14 M Detection limit set higher than guideline LLS Fe-T & 1.47 Jul. 25 & Aug. 14 M Monthy samples Fe-D , 1.48 & Jul. 25, Aug. 14 & Sep. 12 M Monthy samples (Filtered on site) E Long Lake Seeps As-T Jul. 6 M Monthy sample LLSM Cd-D < Aug. 14 M Detection limit set higher than guideline Fe-T Jul. 6 M Monthy sample Fe-D & Jul. 6 & Aug. 14 M Monthy samples (Filtered on site) For all Middle Quinsam Lake Sub-basin and Iron River results background hardness of 30 mg/l was used to calculate those parameters that are hardness dependent. *SO4 at LLE was calculated using a rolling average.

18 TABLE 2 Contaminted Sites Regulations -Freshwatetions -Freshwater Aquatic Life ( CSR-AW ) Exceedances in Ex-Situ Grounin Ex-Situ Groundwater Wells Well ID: QU0821GS QU1105S QU1105S QU1109S QU0813A QU0813A QU0813B Date 26-Sep Sep Sep Sep Sep Sep Sep-17 Sample Class M M M M M Rep M Parameter Units CSR-AW As-D mg/l S2 as H2S mg/l

19 TABLE 3 EMS ID Permit Limit- E Stn.Name South (P) Settling Pond # 1 Stn.Code SPD No discharge occurred all quarter Date Units 11-Jul Aug Sep-17 TSS mg/l 25 < <4.0 Alk-T mg/l Acidity83 mg/l 2.33 <1.0 <1.0 Hard-T mg/l Ag-D mg/l < < Ag-T mg/l < < Al-D mg/l Al-T mg/l As-D mg/l As-T mg/l Ba-D mg/l Ba-T mg/l B-D mg/l Be-D mg/l < < Be-T mg/l < < Bi-D mg/l < < Bi-T mg/l < < B-T mg/l Ca-D mg/l Ca-T mg/l Cd-D mg/l < < Cd-T mg/l < Co-D mg/l Co-T mg/l Cr-D mg/l < < Cr-T mg/l < < Cu-D mg/l Cu-T mg/l Fe-D mg/l Fe-T mg/l Hard-D mg/l Hg-D mg/l < < Hg-T mg/l < < K-D mg/l K-T mg/l Li-D mg/l Li-T mg/l Mg-D mg/l Mg-T mg/l Mn-D mg/l Mn-T mg/l Mo-D mg/l < < Mo-T mg/l < < Na-D mg/l Na-T mg/l Ni-D mg/l Ni-T mg/l Pb-D mg/l 0.05 < < Pb-T mg/l < < Sb-D mg/l < < Sb-T mg/l < < S-D mg/l Se-D mg/l < < Se-T mg/l < < Si-D mg/l Si-T mg/l Sn-D mg/l < < Sn-T mg/l < < SO4-D mg/l Sr-D mg/l Sr-T mg/l S-T mg/l Ti-D mg/l < < Ti-T mg/l < < Tl-D mg/l < < Tl-T mg/l < < Zn-D mg/l 0.2 < < Zn-T mg/l < <0.0050

20 TABLE 4 EMS ID Stn.Name 2 South Inflow Stn.Code 2SI Date Units 12-Jul-17 TSS mg/l <4.0 Alk-T mg/l 413 Acidity83 mg/l 8.54 Hard-T mg/l 511 Ag-D mg/l < Ag-T mg/l < Al-D mg/l Al-T mg/l As-D mg/l As-T mg/l Ba-D mg/l Ba-T mg/l B-D mg/l Be-D mg/l < Be-T mg/l < Bi-D mg/l < Bi-T mg/l < B-T mg/l Ca-D mg/l 171 Ca-T mg/l 181 Cd-D mg/l Cd-T mg/l < Co-D mg/l Co-T mg/l Cr-D mg/l < Cr-T mg/l < Cu-D mg/l Cu-T mg/l Fe-D mg/l Fe-T mg/l Hard-D mg/l 486 Hg-D mg/l Hg-T mg/l K-D mg/l 3.76 K-T mg/l 3.84 Li-D mg/l Li-T mg/l Mg-D mg/l 14.1 Mg-T mg/l 14.3 Mn-D mg/l Mn-T mg/l Mo-D mg/l < Mo-T mg/l < Na-D mg/l 102 Na-T mg/l 107 Ni-D mg/l < Ni-T mg/l Pb-D mg/l < Pb-T mg/l < Sb-D mg/l < Sb-T mg/l < S-D mg/l 74.5 Se-D mg/l < Se-T mg/l < Si-D mg/l 6.28 Si-T mg/l 6.44 Sn-D mg/l < Sn-T mg/l < SO4-D mg/l 198 Sr-D mg/l 1.52 Sr-T mg/l 1.59 S-T mg/l 81.2 Ti-D mg/l < Ti-T mg/l < Tl-D mg/l < Tl-T mg/l < Zn-D mg/l < Zn-T mg/l

21 TABLE 5 EMS ID E E E Stn.Name 2 South Standpipe 2 South Pit CCR Water Cover Stn.Code 2SS 2S 2S Date Units 11-Jul Aug Sep-17 TSS mg/l <4.0 <4.0 <4.0 Alk-T mg/l Acidity83 mg/l 1.39 <1.0 <1.0 Hard-T mg/l Ag-D mg/l < < < Ag-T mg/l < < < Al-D mg/l Al-T mg/l As-D mg/l As-T mg/l Ba-D mg/l Ba-T mg/l B-D mg/l Be-D mg/l < < < Be-T mg/l < < < Bi-D mg/l < < < Bi-T mg/l < < < B-T mg/l Ca-D mg/l Ca-T mg/l Cd-D mg/l < < < Cd-T mg/l < < < Co-D mg/l < < < Co-T mg/l < < < Cr-D mg/l < < < Cr-T mg/l < < < Cu-D mg/l Cu-T mg/l Fe-D mg/l Fe-T mg/l Hard-D mg/l Hg-D mg/l < < < Hg-T mg/l < < < K-D mg/l K-T mg/l Li-D mg/l Li-T mg/l Mg-D mg/l Mg-T mg/l Mn-D mg/l Mn-T mg/l Mo-D mg/l < < < Mo-T mg/l < < < Na-D mg/l Na-T mg/l Ni-D mg/l < < < Ni-T mg/l < < < Pb-D mg/l < < < Pb-T mg/l < < < Sb-D mg/l < < < Sb-T mg/l < < < S-D mg/l Se-D mg/l < < < Se-T mg/l < < < Si-D mg/l Si-T mg/l Sn-D mg/l < < < Sn-T mg/l < < < SO4-D mg/l Sr-D mg/l Sr-T mg/l S-T mg/l Ti-D mg/l < < < Ti-T mg/l < < < Tl-D mg/l < < Tl-T mg/l < < < Zn-D mg/l < < < Zn-T mg/l < < <0.0050

22 TABLE 6 EMS ID Stn.Name 2South Culvert Stn.Code 2SC Date Units 11-Jul Aug Sep-17 TSS mg/l <4.0 Alk-T mg/l Acidity83 mg/l <1.0 Hard-T mg/l Ag-D mg/l < < < Ag-T mg/l < < < Al-D mg/l <0.015 <0.015 Al-T mg/l <0.015 As-D mg/l < < As-T mg/l < Ba-D mg/l Ba-T mg/l B-D mg/l Be-D mg/l < < < Be-T mg/l < < < Bi-D mg/l < < < Bi-T mg/l < < < B-T mg/l Ca-D mg/l Ca-T mg/l Cd-D mg/l < < Cd-T mg/l < < Co-D mg/l < < < Co-T mg/l < < < Cr-D mg/l < < < Cr-T mg/l < < < Cu-D mg/l < < < Cu-T mg/l < < < Fe-D mg/l <0.025 <0.025 Fe-T mg/l <0.050 Hard-D mg/l Hg-D mg/l < < Hg-T mg/l < < K-D mg/l K-T mg/l Li-D mg/l Li-T mg/l Mg-D mg/l Mg-T mg/l Mn-D mg/l Mn-T mg/l Mo-D mg/l < < < Mo-T mg/l < < < Na-D mg/l Na-T mg/l Ni-D mg/l < < < Ni-T mg/l < < < Pb-D mg/l < < < Pb-T mg/l < < < Sb-D mg/l < < < Sb-T mg/l < < < S-D mg/l Se-D mg/l < < Se-T mg/l < < Si-D mg/l Si-T mg/l Sn-D mg/l < <0.025 <0.025 Sn-T mg/l < < <0.025 SO4-D mg/l Sr-D mg/l Sr-T mg/l S-T mg/l Ti-D mg/l < <0.025 <0.025 Ti-T mg/l < < <0.025 Tl-D mg/l < < < Tl-T mg/l < < < Zn-D mg/l < <0.025 <0.025 Zn-T mg/l < <0.025

23 TABLE 7 EMS ID E E E Stn.Name 3 South Pit Stn.Code 3S 3S 3S Date Units 11-Jul Aug Sep-17 TSS mg/l <4.0 Alk-T mg/l Acidity83 mg/l < <1.0 Hard-T mg/l Ag-D mg/l < < < Ag-T mg/l < < < Al-D mg/l <0.015 <0.015 Al-T mg/l <0.015 As-D mg/l < < As-T mg/l < Ba-D mg/l Ba-T mg/l B-D mg/l Be-D mg/l < < < Be-T mg/l < < < Bi-D mg/l < < < Bi-T mg/l < < < B-T mg/l Ca-D mg/l Ca-T mg/l Cd-D mg/l < < < Cd-T mg/l < < Co-D mg/l < < < Co-T mg/l < < < Cr-D mg/l < < < Cr-T mg/l < < < Cu-D mg/l < < Cu-T mg/l < < Fe-D mg/l < Fe-T mg/l <0.050 Hard-D mg/l Hg-D mg/l < < Hg-T mg/l < < K-D mg/l K-T mg/l Li-D mg/l Li-T mg/l Mg-D mg/l Mg-T mg/l Mn-D mg/l < Mn-T mg/l < Mo-D mg/l < < < Mo-T mg/l < < < Na-D mg/l Na-T mg/l Ni-D mg/l < < < Ni-T mg/l < < < Pb-D mg/l < < < Pb-T mg/l < < < Sb-D mg/l < < < Sb-T mg/l < < < S-D mg/l Se-D mg/l < < < Se-T mg/l < < < Si-D mg/l <0.50 Si-T mg/l <0.50 Sn-D mg/l < <0.025 <0.025 Sn-T mg/l < < <0.025 SO4-D mg/l Sr-D mg/l Sr-T mg/l S-T mg/l Ti-D mg/l < <0.025 <0.025 Ti-T mg/l < < <0.025 Tl-D mg/l < < < Tl-T mg/l < < < Zn-D mg/l < <0.025 <0.025 Zn-T mg/l < < <0.025