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INTEROFFICE MEMORANDUM <br />TO: <br />LEIGH SII\LNIONS <br />FROM: <br />JANET BINS <br />SUBJECT: <br />NEW ELK MINE, C1981 -012, TR68, SECTION 3.0 REVIEW <br />DATE: <br />1/16/2014 <br />CC: <br />I have reviewed New Elk Coal Company's (NECC) TR68, Section 3.0 portion or the application. Section 3.0 <br />provides additional information regarding assumptions used and justifications for calculation of the Reclamation <br />Cost Estimate (RCE). <br />The Division has the following concerns or questions regarding the proposed assumptions: <br />On Section 3.0, page 2, NECC proposes that the Operator skill level for reclamation tasks be considered <br />above average and use a 0.9 adjustment. However, there is no explanation of why this value should be <br />utilized. Generally, the Division uses "average operator" for operator skill as a component of the <br />correction factor. Please remember that this value represents the quality of workers that a contractor <br />awarded a state contract would be expected to be able to hire. This value should in no way be confused <br />with the quality of equipment operator that NECC may currently have on staff. <br />If NECC requests a higher skill level that "average" for equipment operator for reclamation tasks, <br />NECC will need to provide justification for "above- average" equipment operator. <br />• On Section 3.0, page 2, under "Material Consistency" NECC incorrectly states that the "correction <br />factor for material constituency is less than 1.0..." <br />The Division believes this statement needs to be corrected to "material consistency" <br />The Division understands NECC's argument that tasks that use a ripper to loosen the material should <br />not have a material consistency correction as well. The ripping task already loosens the material, <br />resulting in more efficiency. The Division concurs with using a material consistency of at least 1.0 when <br />the ripping portion of the task (i.e. dozing or grading) is 50% or higher. This correction would not be <br />applicable to "ripper" tasks. The Division will revise the appropriate tasks in the Division's RCE using <br />this assumption. <br />• NECC provided material weights for onsite conditions at the New Elk Mine. NECC used two different <br />methods for determining material weights. Both are valid methods. NECC proposes to use the results <br />from the method two. The Division accepts the material weights provided in calculation method two <br />(page 4) and will use these material weights in the RCE. <br />