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December 16, 2014 C- 1996 - 084 /Lorencito Canyon Mine LDS <br />Inspection Topic Summary <br />NOTE: Y= Inspected N =Not Inspected R= Comments Noted V= Violation Issued NA Not Applicable <br />NA - Air Resource Protection <br />Y - Roads <br />N - Availability of Records <br />R - Reclamation Success <br />NA - Backfill & Grading <br />Y - Revegetation <br />Y - Excess Spoil and Dev. Waste <br />NA - Subsidence <br />NA - Explosives <br />Y - Slides and Other Damage <br />Y - Fish & Wildlife <br />NA - Support Facilities On -site <br />R -Hydrologic Balance <br />Y -Signs and Markers <br />N - Gen. Compliance With Mine Plan <br />N - Support Facilities Not On -site <br />NA -Other <br />Y - Special Categories Of Mining <br />NA - Processing Waste <br />NA -Topsoil <br />COMMENTS <br />This was a partial inspection by Leigh Simmons of Colorado Division of Reclamation, Mining and Safety, <br />(the Division). The weather was fine and dry. No permitting actions are in progress; TR18 was approved since the <br />last inspection. <br />For a more complete description of the state of New Elk Coal Company refer to the inspection report for <br />the New Elk mine. <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 />No ponds were discharging but all were holding a little water. <br />A culvert had been put in place underneath the road above the shrub plot. This is designated C5 on map <br />2.05.3 -7, although it is slightly mis- located. It should also be noted that the culvert downstream of the new C5 is <br />not a NECC culvert - rather it is the property of the gas company, (that culvert is not shown on map 2.05.3 -7). <br />RECLAMATION SUCCESS - Rule 4.15, Rule 3: <br />The reclamation above pond 6 was inspected closely. Mr Masarotti was disappointed at the damage <br />caused to the recently seeded ground by elk, although the damage did not appear to be extensive. The south side of <br />the drainage will be hydroseeded in the spring. An idea to quantitatively monitor erosion at the site was briefly <br />discussed. <br />Mr Masarotti described his intention to plan for two extended periods to work at Lorencito Canyon every <br />year (in the spring and the autumn). <br />Number of Partial Inspection this Fiscal Year: 4 <br />Number of Complete Inspections this Fiscal Year: 2 <br />Page 2 of 6 <br />