2014-02-04_REPORT - M1983194 (2)

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Natural Soda, Inc. 2013 Project Status Report & Annual Plan of Development 1.0 Introduction and Project Summary 1 Natural Soda, Inc. (NSI) 2013 Project Status Report and Annual Plan of Development is submitted to fulfill the requirements of BLM sodium leases, C- 018326, C- 0118327, C- 0119986, and C -37474 as stated in Federal Regulations 43 CFR, Subpart 3591 and ' 3592 and project Record of Decision dated January 20, 1987. This report is also submitted to the Colorado Division of Reclamation Mining and Safety (DBMS) to meet requirements for Annual Report per State permit number M- 1983 -194, and in part to the EPA to meet requirements set by UIC Class III Area Permits C030358 -00000 and C032169- 00000. ' This report summarizes NSI's 2013 process operations, production activities, reclamation status, geotechnical and environmental monitoring results, as well as, the status of all surface facilities and wells. Proposed operations for 2014 will be described in this report, including drilling the 8H production pair, 14H production pair, DS -7 ground water monitoring well, and two plant production supply water wells (WSW -3 & WSW -4). In 2014 NSI will also begin a multi -year resource definition exploration program, Phase I of the drilling program will include up to thirteen core holes (A -M) located in closer proximity to the NSI plant and current mining operations. These core holes will help define the nahcolite /halite transition boundary in the Boies Bed. Phase II of the exploration project will not occur until 2015/2016 with wells farther away from the NSI plant area. Potential plugging and abandonment (P &A) plans, and other potential 2014 activities will also be covered in latter sections of this annual report. Significant technical considerations and /or proposed changes in operations will also be discussed in the following sections as well. 2.0 Description of Project Area ' 2.1 Location and Regional Setting The four NSI sodium leases are located in the Piceance Creek Basin within Rio Blanco County in northwestern Colorado (Figures 1 and 2). The sodium leases are located ' primarily between Yellow Creek and Ryan Gulch, approximately 41 miles from Meeker, Colorado and 53 miles from Rifle, Colorado. The climate is semi -arid with annual precipitation averaging 12 -14 inches. Precipitation generally occurs as snow from November to March and as rain during the remainder of the year. The vegetation is predominantly Pinyon pine, sagebrush, Utah juniper, western wheatgrass, and needle thread grass. The total area contained within the four sodium leases is 8,222.6 acres ' more or less. The principle operation is primarily confined to T1 S, R98W and Section 26. Figure 1 shows the NSI leases and regional map setting. Figure 2 shows sodium leases within the Piceance Creek Basin. Figure 3 and Figure 4 show the NSI well ' locations, and proposed well locations. DAUB �+ &apA-,S�SSOCIATES, INC. ,gyp 1 January 2014