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PERMIT #: M- 2012 -013 <br />INSPECTOR'S INITIALS: MAC <br />INSPECTION DATE: October 3, 2013 <br />OBSERVATIONS <br />The inspection was conducted by Michael Cunningham of the Division of Reclamation, Mining and Safety <br />(Division). No one was present on behalf of the Smithburg Family Partnership for the. The Higgins Pit II is <br />located approximately 2.S miles west of Genoa, Colorado. The permit boundary encompasses 86.02 acres and <br />the post- mining land use is pastureland. <br />On August 23, 2013, the Division received a request for an acreage release and associated financial warranty <br />reduction for the Higgins Pit II. The request was sent in accordance with Rule 4.17. The Division sent notice of <br />the release request to the Lincoln County Commissioners, the High Plains Soil Conservation District and the <br />landowner. The Division received comments from the High Plains Soil Conservation District (copy enclosed). <br />The Operator has requested the release of 38.36 acres and a reduction of the financial warranty from <br />$192,000.00 to $106,380.00. The purpose of this inspection was to verify that the area requested for release <br />had not been affected by the mining operation. <br />The permit sign was posted at the site entrance and the boundary of the affected area was clearly delineated <br />as required by Rule 3.1.12. No mining was occurring at the time of the inspection and no personnel were on <br />site. The Higgins Pit II is situated at the top of a natural escarpment with a southerly aspect. Topsoil has been <br />salvaged and stockpiled at the northern end of the site. Silt fences have been placed on the slope below the <br />affected area. The silt fences are in decent shape and are functioning properly. The Operator will need to <br />periodically inspect the silt fences and conduct maintenance to ensure the fences continue to prevent <br />sediment from leaving the affected areas. <br />The 38.36 acres requested for release are situated at the southern end of the site. The Division confirmed that <br />the area requested for release has been unaffected by the permitted mining operation. Therefore, this area is <br />eligible for release. In addition, the Division performed a complete financial warranty calculation and <br />determined that the financial warranty amount may be lowered to $106,380.00, which is an adequate amount <br />to complete reclamation of the remaining 47.66 acres. <br />Notice of the Division's decision regarding the release of 38.36 acres and the reduction of the financial <br />warranty to $106,380.00 will be sent under separate cover. <br />This concluded the inspection. <br />Inspection Contact Address <br />John Higgins <br />Smithburg Family Partnership, LLLP <br />27451 CR 3H <br />Genoa, CO 80818 <br />Enclosure <br />Page 2 of 3 <br />