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AIL <br />R7 <br />��._CcIVW- F <br />201 ?S' -5 f`H 10:3 <br />APPLICATION FOR FEDERAL COAL LEASE SUSPENSION <br />Lessee: Sage Creek Holdings, LLC <br />701 Market Street, Suite 718 <br />St. Louis, MO 63101 <br />C-1) <br />Officer: G. R. Wagner —+ C-- <br />Vice President --J s <br />701 Market Street, Suite 718 -v r <br />St. Louis, MO 63101 <br />Suspension Requested: Suspension of Operations and Production in the interest <br />of Conservation of the Resources under Section 39 of the <br />Mineral Leasing Act of 1920, and amended and implemented by <br />regulations at 43 CFR §3483.3 <br />Federal Coal Leases: COC -30656 <br />COD- 056298 <br />COC- 0126480 <br />Sage Creek Holdings, LLC ( "SCH ") is the lessee under the above referenced federal coal leases and owns <br />or controls other lands that are generally referred to as the Williams Fork Mine (formerly called the <br />Empire Mine, and other names previously), located in Moffat County, Colorado, generally in Townships <br />5 and 6 North, Ranges 91 and 92 West. <br />SCH's predecessors in interest, beginning in the mid 1990's, Cyprus Amax Minerals Company and RAG <br />American Coal Holding, Inc., have sought a cessation of mining operations on the leases due to poor <br />market conditions and requested, under the regulations at 43 CFR §3483.4 the right to make advance <br />royalty payments in lieu of fulfilling its lease obligations with respect to continuous operation of the <br />subject leases. The BLM reviewed the original requests and notified MMS (now ONRR) that it was <br />approving the requests. SCH and its predecessors in interest have been requesting the right to make <br />those payments and have made them annually ever since. The last such requests were made in <br />September and November of 2012. Requests were approved and payments have been timely made to <br />ONRR. <br />Market conditions for the coal at Williams Fork have not materially changed since 2000 and may have <br />become worse due to the intervening implementation of state and local government regulations and <br />energy policies. There is clearly no local market for the coal at present. Compounding the condition of <br />this specific Colorado coal market is the general decline in the domestic coal market. <br />SCH and its affiliates have an approved mine plan which will maximize economic coal recovery over the <br />entire mine area and there has been substantial investment in the form of mine development, surface <br />facilities, lands, permitting and equipment in connection with this mine. The suspension of the <br />