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RULE 2 PERMITS <br />Colowyo has previously auger mined at the Colowyo Mine with a limited auger application on the east <br />side of the East Pit under Section 11. This mining targeted the C and E seams, and was successful <br />although the depth of penetration was rather limited (100 —400 feet). See Mine Plan Map (Map No. 23). <br />Description of the Highwall Mining Method <br />Modern highwall mining machines incorporating advanced technologies, should allow Colowyo to <br />obtain greater penetration depths on each hole than conventional augering methods (approximately <br />1,400 feet plus with optimal conditions) with increased horizontal and vertical guidance ability built <br />into the system. Greater penetration depth is a function of a more robust launch vehicle platform that <br />sits outside controlling all functions of the system, rigid conveyor cars each fitted with its own belt <br />conveyor (cars act similar to drill steels on drilling rigs), and a full sized conventional, remote <br />controlled underground continuous miner performing the mining of each hole. The exact horizontal <br />and vertical controls of the system are a result of video cameras placed on the miner giving real time <br />visuals to the outside operator, a proprietary HORTA Guidance System that gives continuous three <br />dimensional locations, and Gamma Sensors in the miner's cutting head that give the miner the ability <br />to sense roof and floor rock hence keep the miner in the coal seam and avoid out of seam dilution and <br />maintain optimum hole conditions. <br />Depth of penetration, hence coal recovery, for any given hole will vary depending upon multiple <br />considerations, namely coal seam splitting, thinning /pinching of the coal seams, acceptable coal <br />quality parameters, roof and floor integrity, and machine physical limitations. <br />The highwall miner application has proved to be very successful at Colowyo. Colowyo has mined <br />multiple pits and seams successfully in areas surrounding both the East and West Pits (see Map 23, <br />Mine Plan) and South Taylor Pit (see Map 23A, Mine Plan). <br />In the East Pit, all surface mining activities were completed by year -end 2003. Colowyo finished the <br />last highwall mining panel in 2006 and the East Pit is currently in final reclamation per the approved <br />reclamation plan. Highwall mining occurred in the B, C, D, and E coal seams. Mining activities <br />commenced on the bottom E seam, and then progress sequentially upward through the remaining <br />seams. As the seams were mined out, the pit was backfilled up to the floor of the next higher seam, <br />with spoil placed by a dragline or from the truck shovel operation. The backfilling of the pit was <br />required to attain conformance with Colowyo's permitted reclamation plan /post- mining topography, <br />and the partially backfilled pit also served as a temporary level pit floor to work from to mine the <br />next higher seam. <br />Historically, in the West Pit, highwall mining successfully occurred in the X seam that underlied the <br />West Pit Parking Lot Area and the E seam on the southwestern end of the pit underlying part of the <br />Section 16 Pit. Currently, Colowyo is proposing to highwall mine the F, E, D2, and C seams in the <br />final highwall of the West Pit (see Map 23). After the F seam is mined out the pit will be backfilled <br />up to the E seam and highwall mining will commence again. This same sequence will occur from the <br />E, D2, and C seam. This sequence of backfilling and highwall mining will ensure the final pit will be <br />backfilled in a contemporaneous manner in accordance with the approval spoil grading plan. <br />For highwall mining description in the South Taylor Pit, please see Volume 12, Rule 2.06.9. <br />Rule 2 Permits 2.06 -9 Revision Date: 10/18/13 <br />Revision No.: TR -100 <br />