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The raise bore is drilled through the San Juan Formation of tertiary age and the rock penetrated is <br />primarily andesite, which is a volcanic rock consisting of plagioclase feldspar, quartz and biotite mica. <br />Some limestone is also present in the andesite of this area. The grain sizes are extremely small since <br />the molten rock cooled very rapidly. Normally, the rock has a subdued greenish color, but occasionally, <br />a slight iron impurity will color the rock with a reddish color. <br />4. Reasons for Sediment Laden Discharge <br />During the drilling of the pilot hole from the surface, no appreciable water was observed in the hole, so <br />no extra precautions were taken to address water at the bottom of the raise bore. After the 8 feet bit <br />was attached and the raise bore progressed upwards, a zone of rock was encountered that did have <br />more water than anticipated from the pilot hole. By coincidence, this area also had a zone of andesite <br />that had reddish color and some of the plagioclase feldspar had converted to minor amounts of clay <br />over thousands of years. <br />Any water produced from the raise bore would enter the Virginius workings and then the ditch along the <br />main Revenue Tunnel and flow by gravity an additional 7900 feet to the mine portal. At that point, the <br />water entered two 8" diameter HDPE pipes which discharge into Sneffels Creek. Once the mine is in <br />full operation, these discharge pipes will enter the Mine Water Pond and this water will discharge into <br />Sneffels Creek. This is expected to occur in December of 2014. <br />During the early morning hours of October 24, the raise bore encountered this zone of higher water flow <br />and reddish color andesite. This water was later estimated to be approximately 20 -25 gallons per <br />minute. As the water trickled down the raise bore and passed through the finer material from the drilling <br />of the raise bore, sediment laden water was produced. This water combined with the normal clear water <br />flow from the mine of approximately 250 -300 gallons per minute and this water was discharged to <br />Sneffels Creek. <br />Page 6 of 17 <br />