I noticed several searches for chimney repair in my logs to my gallery, so here is a how too.

First off you will need some tools / materials.

1. Morter Mix (I used 2 x 40 pound bags)
2. Portland Cement (I used 1 90 pound bag)
3. Large Bucket
4. Cement Glue - used to prep the cinder block so the cement will stick
5. Masonry Brush
6. Trowel - the type depends on the finished surface you want. I used a hard spongelike trowel for a stucco like texture
7. Ladder / Hammer / Scraper
8. Plastic or cloth to cover the entire chimney

Once you have all the supplies you are ready to begin whether permitting. For cement to cure well the longer the drying time the better. If it is cloudy cool and damp you can possibly do without the plastic or cloth to cover the cement as it cures. If it is hot and sunny you will want to cover the cement with plastic or a damp cloth. The longer the curing time the stronger the cement will be.

1. First you need to prep the cinder block. Scrape off as much paint as you can and chip away any loose sections. My chimney was so water damaged that the cinder block was pitted and had big sections breaking of. This is the only part you need the hammer for. Just lightly tap on any loose sections and scrape away all the loose stuff.
2. Next, brush off any loose dust with the masonry brush and brush on the masonry glue. This will help the cement bond with the cinder block. Basically it looks like a thick elmers glue.
3. Now you are ready to apply the cement. I used approx 3/4ths morter mix and 1/4 portland cement.
   I found it much easier to get the surface I wanted by mixing a thick - like peanut butter consitancy mixture of morter mix and cement to first fill in large gaps and the morter gaps in the cinder block. To fill in the gaps I used my scraper. I found I could press the cement into the cracks and smooth the thick mixture much easier with a metal scraper than with my rubber texturising trowel.
4. After I had all of the holes and gaps relatively smooth I applied a thinner coat over the whole thing and textured it. If you want a really smooth texture use a flat metal trowel. For a light texture you can create a normall stucko texture with a spongelike texturizing trowel and then brush it out with the masonry brush. I went with a pretty rough texture because I was hiding lots of damage and I figured it would help hide places that might not be perfectly smooth. A thin coat of cement still goes on pretty thick. you want at least a centimeter coating unless the cinderblock is well intact where all you need is some texture.
5. Let the cement cure for as long as possible by lightly wetting it and covering it. I live in WA state and the weather was cooperating cloudy and misty so I didn't have to cover anything.
6. I did my Chimney in sections over a period of several days, but I imagine the more you can do at once the stronger the overal bond will be.
7. Once everything has cured seal it well with 2 coats of  Dry-Lock or a similar masonry sealant and paint.

I haven't gotten around to the painting yet, but here are some pictures of the project.