1. Hydrogeological Background Study Proposed Gravel Pit SE-35-032-06 W5M Brent Lennox, M.Sc., P.Geol. Waterline Resources Inc. December 10, 2012

2. Sources of Information  Regional geological and hydrogeological mapping (Ozoray and Barnes, 1977; Shetsen, 1987; HCL, 2000; Budney et al., 2004, TGWC, 2012)  Water well records from AESRD water well database (AESRD, 2012)  Approvals search (AESRD, 2012)  Site test pitting  Regional geological and hydrogeological mapping (Ozoray and Barnes, 1977; Shetsen, 1987; HCL, 2000; Budney et al., 2004, TGWC, 2012)  Water well records from AESRD water well database (AESRD, 2012)  Approvals search (AESRD, 2012)  Site test pitting

3. Study Area Proposed Development Extent of Aquifer Bearberry Creek Red Deer River Regional Groundwater Flow Direction Distance from Site to: Red Deer River: 2 km south and 6 km east Bearberry Creek: 2.3 km northeast

4. Regional Geology/Hydrogeology Gravel Sandstone/ Shale 0.9 m Ground Overburden/Bedrock Contact: 5 to 29 m regionally, >4.5 m at site, 29 m at water well record within site quarter Average Depth to Water at Site = ~3.2 m = Vertical Gradient Proposed Depth of Excavation Topsoil/Silt Rates of 11 to 273 L/min within 1.6 km radius

5. Water Wells Proposed Development Quarter Section  61 well records within 1.6 km radius, majority use gravel horizon as water source (AESRD, 2012)  Closest residences are in NE corner of site quarter section, 550 m NW, 725 m NE, 1.2 km E, numerous >80 m S based on aerial photographs  One water well in quarter section installed in bedrock aquifer

6. What’s Next  Still in preliminary stages of application process  Approval to divert water via evaporation from the end pit lake in process with Alberta Environment  Waiting on Alberta Environment to determine if there are additional regulatory requirements  Still in preliminary stages of application process  Approval to divert water via evaporation from the end pit lake in process with Alberta Environment  Waiting on Alberta Environment to determine if there are additional regulatory requirements