2013-12-23_INSPECTION - M2013064

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PERMIT #: M- 2013 -064 INSPECTOR'S II`IITLUS: PSH INSPECTION DATE: December 12, 2013 OBSERVATIONS This was a pre- operation inspection of the Varra - Coulson Resource Project site conducted by Peter Hays with the Colorado Division of Reclamation, Mining and Safety (Division /DRMS). Mr. Brad Janes with Varra Companies, Inc. (Varra) was present during the inspection. The 112c application package was received by the Division on September 18, 2013 and deemed complete for purposes of filing on October 4, 2013. The current permit application decision date is February 2, 2014 following a 30 -day extension request from Varra to allow for time to respond to the Division adequacy letter dated December 16, 2013. The site is located approximately 3 miles east of Greeley, Colorado in Weld County and adjacent to the Durham site operated by Varra. The required notice sign was observed during the inspection at the future entrance location. The permit boundary corners were well defined by fences on the south, east and west sides of the site. A survey stake indicating the northeast corner of the site was observed along Fern Ave. The proposed Varra - Coulson Resource Project site will be 100.63 total acres divided into 3 mining fields. A total of 65.88 acres of land will be disturbed south of the Poudre River resulting in a 59.30 acre clay lined reservoir. All mining activities will occur on land owned by Varra and Coulson Excavating Company, Inc. Mining activity will commence in the northeast corner of the middle field and proceed in a counterclockwise direction toward the west. The processing plant will be located in the southwest corner of the south field outside of the 100 year floodplain. The middle and south fields will be mined concurrently. The north field is not expected to be disturbed during the life of the mine. The site consists of three to five feet of topsoil and the depth to bedrock varies from 33 to 37 feet deep with an average of 40 feet. The site will be mined as a dewatered open pit using standard mining equipment and methods. The groundwater level is approximately 5 to 10 feet below the natural ground level. The mining highwall will be excavated at a 1.25H:1V slope. The highwalls will be backfilled to a 3H:1V slope prior to the construction of the clay liner. The present land use is general agriculture. The current vegetation consisted of native grasses and trees. Two oil and gas wells and the associated infrastructure are located on the site, one in the southeast corner of the south field and one in south side of the north field. All man -made structures and utilities appear to have been identified by the Applicant in the permit application; however the text on the Exhibit C maps is difficult to read. The Division mailed an adequacy letter for the site on December 16, 2013. Pre - operation inspection photographs are attached below. Inspection Contact Address Mr. Brad Janes Varra Companies, Inc. 8120 Gage Street Frederick, CO 80516 Cc: Tom Kaldenbach, DRMS Page 2 of 5