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Mountain Coal Company <br />April 23, 2014 <br />Ms. Barbara Sharrow, Field Office Manager <br />Bureau of Land Management <br />Uncompahgre Field Office <br />2465 South Townsend Avenue <br />Montrose, CO 81401 <br />Gunnison Board of County Commissioners <br />Gunnison County Courthouse <br />200 East Virginia, Suite 104 <br />Gunnison, CO 81230 <br />Minnesota Canal & Reservoir Company <br />41103 Lamborn Mesa Rd <br />Paonia, CO 81428 <br />Mountain Coal Company, LLC <br />West Elk Mine <br />P.O. Box 591 <br />Somerset, CO 81434 <br />Jessica A. Loveland, P.E. <br />Environmental Engineer <br />iloveland(a�archcoal.com <br />phone: 970.929.2308 <br />Mr. Levi Broyles, District Ranger <br />USDA Forest Service <br />Paonia Ranger District <br />P.O. Box 1030 <br />Paonia, CO 81428 <br />Ark Land Company <br />c/o Mountain Coal Company, LLC <br />P. O. Box 591 <br />Somerset, CO 81434 <br />Re: Mountain Coal Company, LLC, West Elk Mine; Permit No. C- 1980 -007; Notice of <br />Requests for Phase I Reclamation Bond Release <br />To Whom It May Concern: <br />In compliance with Rule 3.03.2(1) of the of the Regulations of the Colorado Mined Land Reclamation <br />Board for Coal Mining ( "the Regulations "), 1980, as revised, Mountain Coal Company, LCC (MCC) is <br />providing this notice to inform the above mentioned landowners that MCC plans to request from the <br />Colorado Division of Reclamation, Mining and Safety ( CDRMS) a partial release of the reclamation <br />liability held in surety bonds. The bond release requests are planned for several reclaimed methane <br />drainage wells (MDW), exploration sites and associated roads within the West Flatiron and the Dry Fork <br />of Minnesota Creek areas. MCC proposes to request Phase I bond release for up to 60% of the <br />reclamation bond held by the CDRMS for each site. <br />In accordance with the Regulations, Phase I bond release may be requested after backfilling, regrading <br />and drainage control has been successfully completed in accordance with MCC's approved reclamation <br />plan. Backfilling and grading are considered to be complete when the final post -mine topography has <br />been achieved in accordance with the permit, including establishment of the approved permanent <br />stormwater drainage system. <br />MCC holds reclamation surety bonds from Arch Insurance Company and Bond Safeguard Insurance <br />Company (Bond numbers SU1116159 and 5010562, respectively) totaling $15 million. The reclamation <br />cost estimates for the reclaimed sites that will be part of the requests are covered by these bonds. The <br />cost estimates were calculated by the CDRMS before the approval of each project's permit revision <br />application was issued. The reclamation cost estimates include plugging the drill holes, removal of any <br />surface facilities, regrading the area to approximate original contours, replacing topsoil, and revegetating <br />the sites and roads. The estimates also include CDRMS overhead and contingency costs. These estimates <br />have been subsequently updated and increased, if needed, during permit renewal and mid -term reviews, <br />considering the most current materials, fuel and labor costs, etc. <br />Page 1 of 2 <br />