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DEPARTMENT OF NATURAL RESOURCES <br />DIVISION OF WATER RESOURCES <br />Mr. Wayne I. Schieldt <br />Water Resources Solutions, LLC <br />67769 Osprey Lane <br />Montrose, CO 81401 <br />June 21, 2012 <br />John W. Hickenlooper <br />Governor <br />Mike King <br />Executive Director <br />Dick Wolfe, P.E. <br />Director /State Engineer <br />Re: Substitute Water Supply Plan for Western Fuels- Colorado, LLC <br />Division 4 Water Court Case No. 2010CW208 <br />Section 6, T 46 N, R 15 W, N.M. P.M. and Section 31, T 47 N, R 15 W, N.M. P.M. <br />Water Division 4, Water District 60, Montrose County <br />Approval Period: June 1, 2012 through May 31, 2013 <br />Contact Phone Number for Mr. Wayne 1. Schieldt: 970 - 596 -6644 <br />Dear Mr. Schieldt: <br />We have reviewed your submittal of February 15, 2012 in which you request approval of a <br />substitute water supply plan ( "SWSP ") pursuant to § 37 -92- 308(4), C.R.S., for Western Fuels - <br />Colorado, LLC ( "Western Fuels" or "Applicant "). Western Fuels has filed an application for approval of <br />change of water rights, and a plan for augmentation in the Division 4 Water Court under case no. <br />2010CW208. The SWSP references the 2010CW208 augmentation plan and Western Fuels has <br />provided notice of the requested SWSP to all counsel of record for 2010CW208. That notice was <br />mailed on February 17, 2012. The State Engineer's Office ( "SEO ") received comments from Michael <br />Morgan and JoEllen Turner ( "The Morgan Family ") during the statutory 30 -day comment period. The <br />statutory $300 filing fee (receipt no. 3654077) was submitted with this request. <br />SWSP Operation <br />The purpose of this SWSP is to replace the out -of- priority depletions associated with the <br />Applicant's coal mining operation located near Nucla, in the San Miguel River Basin, while case no. <br />201 OCW208 is pending in water court. Western Fuels' coal mining supplies are used as fuel for <br />electricity generation at the Nucla Station Power Plant, which is owned and operated by the Tri -State <br />Generation and Transmission Association, Inc. Currently the Applicant conducts its mining operation <br />in the New Horizon 2 Mine ( "NH21VI") area located in Section 1, Township 46 North, Range 16 West, <br />Section 36, Township 47 North, Range 16 West, Section 31, Township 47 North, Range 15 West and <br />Section 6, Township 46 North, Range 16 West all in the N.M. P.M. (Exhibit A). Once mining is <br />complete at the NH2M (scheduled through 2013), the Applicant plans to move its mining operation to <br />the New Horizon North Mine (`NHNM ") area and subsequently to the Cyprus Mine area. For the <br />purpose of this SWSP, the NH2M, the NHNM and the Cyprus Mine area are referred as the New <br />Horizon Mine. <br />Depletions <br />The New Horizon Mine ( "NHM ") is an open pit mine in which Western Fuels removes <br />approximately 60 to 120 feet of overburden material, mines the coal from the seam, replaces the <br />overburden material and restores and reclaims the surface profile. The mined area is reclaimed <br />Office of the State Engineer <br />1313 Sherman Street, Suite 818 • Denver, CO 80203 • Phone: 303 - 866 -3581 • Fax: 303 - 866 -3589 �? d <br />www.watenstate.co.us t7 U 1 <br />4p0tvV4 <br />/0 gp1- X/--3 <br />