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Exhibit A <br />Scope of Work <br />WATER ACTIVITY NAME -Sand Wash Basin Coalbed Methane Production Depletive Effects on Water <br />Resources Study <br />GRANT RECIPIENT -Moffat County <br />FUNDING SOURCE -Statewide Account ($98,835) and YampaNVhite Basin Account ($20,000) <br />Introduction <br />This document outlines a scope of work for carrying out analyses relating to current and potential future <br />levels of stream depletion generated by removal of water by coalbed methane ("CBM") production wells in <br />the Sand Wash Basin of Colorado (see attached map). This study is an effort led by the Colorado <br />Geological Survey ("CGS") in collaboration with the Colorado Oil and Gas Conservation Commission <br />("OGCC") and the State Engineer's Office Division of Water Resources ("DWR"). These agencies are <br />part of the Colorado Department of Natural Resources ("DNR"). <br />Note that while most of the tasks described below are in narrative format, there are a few items that are <br />assumed to be self-explanatory in nature and not requiring narrative discussion. These items are simply <br />listed by heading and enumerated in accord with the overall structure of this scope. <br />Purpose and Goals <br />The purpose of this study is to develop a quantitative assessment of the levels of stream depletion or <br />reduction in formation outflows (spring flows or flowing stream systems gaining from contact with <br />formations) that may be occurring as a result of the removal of water by CBM wells, or that may occur if <br />CBM development expands in the basin. It is recognized that CBM production in the Sand Wash Basin is <br />in the early stages of development and that there currently may be little impact; accordingly, this study will <br />characterize the target CBM formations with respect to water resources in anticipation of future CBM <br />production. In other basins CBM production water has historically has been disposed by one or more <br />methods, including re-injection into deep formations, discharge to the surface stream system, and <br />ponding/evaporation. The concern has been raised that the removal of significant volumes of water from <br />aquifers that may be tributary to the surface stream system could be resulting in stream depletions or a <br />reduction in spring flows and/or formation outflows (accretions) that are of a magnitude sufficient to cause <br />injury to senior water rights holders on over-appropriated stream systems throughout Colorado. An <br />additional concern has also been raised that removal of this water may negatively impact local ground <br />water users tapping the same stratigraphic intervals as targeted for CBM production. This study seeks to <br />develop a reliable assessment as to the levels of depletion, definition of the areas where CBM is ongoing <br />that might be classified as nontributary, definition of any potential correlations of water quality, geology, <br />aquifer geometry, or formation/well depth that could lead to general guidelines about the potential for <br />stream depletion. These results will be useful in either prompting or avoiding more detailed studies, and <br />the development of recommendations for further data collection or investigations. <br />Scope/Focus Area <br />The analysis carried out under this scope of work will focus in the Sand Wash Basin of Colorado (see <br />attached map). The overall analysis tasks to be included in this study are outlined below. The work <br />product will be a comprehensive report presenting all analyses carried out, methods applied, <br />assumptions, results, conclusions, and recommendations. <br />Sources of data that will be useful in carrying out the tasks involved in this study include, but are not <br />1 <br />