2015-02-27_REPORT - M1982020 (3)

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Based on the knowledge of the geology of the area and the hydrologic conditions imposed by those geologic features, the information that has been assembled indicates that the mine and mill site can both be effectively monitored by using the Lucky Strike Mill Spring. The geologic structure as it crosses the bottom of the gulch below the permit area acts as an aquatard, damming and blocking underground water flows coming towards it from the east. Thus, the water produced by the spring is sourced from the area where the mine and mill are located and shows the condition of the groundwater sourced from within the permitted area. Since the Lucky Strike Mill Spring discharges to surface, the regulatory requirement for water quality is the State of Colorado surface water standards. Two water samples will be collected quarterly beginning with the fourth quarter of 2014, and continuing during production. The two samples will include one collected from within the Lucky Strike Mine and one from the Lucky Strike Mill Spring. The sample parameters will consist of those shown in Section 12 which is the same as those used for the third quarter 2014 sample set. The parameters might be modified based on future results and an increased knowledge of the site. In the implementation of groundwater sampling, two groundwater samples were collected on August 4, 2014. Sample 1 was collected from the Lucky Strike Mine at a depth of 150 feet below the collar, and Sample 2 was collected from the Lucky Strike Mill Spring. Review of those third quarter results show that the water collected from both locations meet State of Colorado Surface Water Supply Standards as defined in Regulation 31, (5 CCR 1002 -31) and also meet Colorado drinking water standards. The target concentrations for water quality at the Lucky Strike Spring discharge point will be the Colorado Surface Water Supply Standards. It will be required that all laboratory reporting Method Detection Limits (MDLs,) either meet or exceed the concentrations contained within the State of Colorado Standard. The Colorado State Standards are shown below, and the laboratory results from the third quarter 2014 water sampling event follow.