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PERMIT #: M- 1987 -072 <br />INSPECTOR'S INITIALS: MAC <br />INSPECTION DATE: August 22, 2013 <br />OBSERVATIONS <br />The inspection was conducted by Michael Cunningham of the Division of Reclamation, Mining and Safety <br />(Division). Thomas Musch, the Operator, was also present for the inspection. The Lee No. 2 Placer is located in <br />Gilpin County, approximately 3 miles southeast of Central City, Colorado. The site is permitted for 1 acre and <br />the post- mining land use is pastureland. The permit area is situated on the lower Russell Gulch, within a 40 <br />acre claim issued by the Bureau of Land Management (BLM). <br />The permit sign was not posted at the site entrance. However, the Operator has had a difficulty in maintaining <br />a permit sign due to repeated vandalism. The Division has required Mr. Musch to replace the permit sign in <br />the past and has authorized him to operate without a permit sign if the sign was stolen or further vandalized. <br />Therefore, the Division will not cite a problem for failure to post a permit sign at the site entrance. The <br />boundary of the affected area was delineated as required by Rule 3.1.12. <br />The site was not active at the time of the inspection; the mine is operated on an intermittent basis. A motor <br />home was located near the site entrance; the Operator resides in the mobile home on a seasonal basis. The <br />approved Mining Plan allows the Operator to remove material from the creek bed. The material is then passed <br />through a trommel and sluice box. The Operator has constructed several check dams across Russell Gulch. The <br />check dams capture and prevent sediment from migrating past areas where placer mining is occurring. The <br />disturbance associated with the mining operation is minimal and is primarily contained within the channel of <br />Russell Gulch. The Division observed additional disturbance outside of the permit boundary. The disturbance <br />consisted of minor excavations into the embankment on the east side of Russell Gulch. The Division estimates <br />that 10 cubic yards of material was removed from this area. According to Mr. Musch, the area of Russell Gulch <br />where the Lee No. 2 Placer is located is frequently accessed by the public for prospecting activities and illegal <br />dumping. <br />The Division currently holds a financial warranty in the amount of $1,200.00. Presently the reclamation tasks <br />include removing the check dams on Russell Gulch and seeding the minor areas of disturbance. The Operator <br />has done an excellent job in minimizing the amount of disturbance at the site and in performing concurrent <br />reclamation. At this time, the financial warranty is adequate to complete reclamation. However, any <br />additional disturbance to the site could result in a financial warranty increase. <br />This concluded the inspection. <br />Page 2 of 4 <br />