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COMPASS LAND <br /> G R O U P <br /> market . As such , it is important for Company and community long- range planning that the term <br /> of the mining and processing permits align with the anticipated life of the aggregate reserve . <br /> The Hendrick Quarry is fully permitted to supply the local market with essential construction <br /> materials . Given the current pace of mining at the nearby Bellino Quarry, the Hendrick Quarry <br /> Permit will expire before the permitted reserves within the approved mining boundaries have <br /> been realized . Extending the term of the Hendrick Quarry Permit will provide the ability to <br /> extract the permitted reserves , which will enable the continued supply of an important source of <br /> local construction materials . <br /> Regional Demand <br /> The Department of Conservation - California Geological Survey ( " CGS " ) monitors and reports on <br /> the availability and production of aggregate materials used for construction purposes and <br /> conducts on - going studies that identify and evaluate permitted reserves , production , and <br /> available resources throughout the State of California . In 2018 , CGS published a report titled <br /> Aggregate Sustainability in California , which analyzed aggregate availability within 30 defined <br /> aggregate " production - consumption " regions across the state ( " Report " ) . The Report provides <br /> reliable information to local agencies on the status of local aggregate reserves, and projects a <br /> demand for those reserves over a 50 -year time horizon . With respect to San Joaquin County, the <br /> Report identified a significant shortage of permitted aggregate reserves that is not projected to <br /> meet anticipated regional demand over the next 50 years . More specifically, the Report found <br /> that the Stockton - Lodi production - consumption region is expected to consume 409 million tons <br /> of aggregate over the next 50 years , while only 203 million tons of aggregate reserves are <br /> currently permitted ( i . e . , less than 50 % of the anticipated demand is permitted , assuming that <br /> the reserves at the Hendrick Quarry are fully mined ) . This indicates a significant future shortfall <br /> in local aggregate reserves . A time extension to the Permit will ensure a permitted local source <br /> of aggregate material is maintained , and that the region does not fall further behind in its ability <br /> to meet future demand . <br /> Remaining Reserves <br /> -------------------- ---------------------------------------- ------------ --------------------------------- -------------------------------- --------------------- ------ ----- ----- ------- -------- <br /> As shown in Table 1 , below, it is estimated that approximately 34 years of remaining reserves <br /> exist at the Bellino and Hendrick Quarries . <br /> Table 1 <br /> Belluno and Hendrick Quarries Permitted Reserves <br /> Yearof <br /> � r <br /> pr <br /> • i , ! II 1 <br /> r ' I <br /> i . e . <br /> -_-- -. ---t1 ��--- — --- --- — 1 — ---- ------------ ------ ----------------------- �— ---- --------------- ---- ---- --- --__- -. ��------------- - <br /> Mining complete in Phase I - - - <br /> i <br /> II ------ ------2---6-------------A1 <br /> 17 <br /> -------1--5- ---- ------------ - ---- - -----2035 <br /> ..... ......... <br /> Bellino <br /> j ----------- <br /> 111 15 07 7 2042 --- � <br /> iL----------- -- ----- ----- -- ----III.......-----...— ....... ------- ------------------ -----s— ------ ------- --- ------- <br /> Final Reclamation 2 ; 2044 <br /> ------.....----.......... ---- ----- ----- ------------------------- ------------------------ ----- ------- -- --- ------ ---- ------------ -- ------------- --- ---- ---- -J <br /> Page 2 <br />