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September 10, 2014 C- 1981- 012/New Elk Mine LDS <br />Inspection Topic Summary <br />NOTE: Y= Inspected N =Not Inspected R= Comments Noted V= Violation Issued NA Not Applicable <br />Y - Air Resource Protection <br />N - Availability of Records <br />N - Backfill & Grading <br />R - Excess Spoil and Dev. Waste <br />NA - Explosives <br />Y - Fish & Wildlife <br />R - Hydrologic Balance <br />R - Gen. Compliance With Mine Plan <br />NA -Other <br />R - Processing Waste <br />R - Roads <br />Y - Reclamation Success <br />R - Revegetation <br />NA - Subsidence <br />N - Slides and Other Damage <br />N - Support Facilities On -site <br />Y -Signs and Markers <br />N - Support Facilities Not On -site <br />NA - Special Categories Of Mining <br />N -Topsoil <br />COMMENTS <br />This was a partial inspection by Leigh Simmons and Marcia Talvitie of Colorado Division for <br />Reclamation, Mining and Safety, (the Division). The inspection was accompanied by John Terry of New Elk Coal <br />Company, (NECC). The weather was fine. Several permitting actions are in progress, these are detailed under the <br />heading GENERAL MINE PLAN COMPLIANCE. <br />The status of the New Elk Mine is Active. At the time of the inspection the mine was producing coal, but <br />no coal was being shipped. Raw coal was being stockpiled. A small amount of clean coal was stockpiled, but coal <br />was not being washed at the time of the inspection. NECC is in the process of negotiating a sales contract with a <br />local customer (who had previously taken delivery of a shipment of coal for a test burn); at the time of the <br />inspection no contract was in place. <br />There had been no changes in personnel since the previous inspection. <br />EXCESS SPOIL and DEVELOPMENT WASTE — Rule 4.09 <br />Placement; Drainage Control; Surface Stabilization: <br />The temporary development waste pile that has been accumulating on the clean coal stockpile area has <br />grown to a substantial size. It is intended that it will be transported to the RDA by truck pending approval of <br />TR70; this is estimated to be 3 week's - I month's worth of work. No changes were observed at any of the other <br />three development waste piles. <br />HYDROLOGIC BALANCE - Rule 4.05 <br />Drainage Control 4.05.1, 4.05.2, 4.05.3; Siltation Structures 4.05.5, 4.05.6; Discharge Structures 4.05.7, 4.05.10; <br />Diversions 4.05.4; Effluent Limits 4.05.2; Ground Water Monitoring 4.05.13; Surface Water Monitoring 4.05.13; <br />Drainage — Acid and Toxic Materials 4.05.8; Impoundments 4.05.6, 4.05.9; Stream Buffer Zones 4.05.18: <br />Ponds 1, 4, 6, 7, and 8 were inspected. No ponds were discharging. <br />Vegetation had been cleared from the embankment of pond 4 to allow access to the emergency and <br />primary spillways. <br />Pond 6 had not been lined. Mr Terry said that NECC were considering more cost - effective alternatives to <br />Number of Partial Inspection this Fiscal Year: 2 <br />Number of Complete Inspections this Fiscal Year: 1 <br />Page 2 of 10 <br />