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cotter Via Email March 23, 2015 RECEIVED �iAR 2 5 2015 DMSION OF RECt.AMATO MINING AND SAFETY Michael Cunningham . p`r Division of Reclamation, Mining & Safety Department of Natural Resources 1313 Sherman Street, Room 215 �,) _ / 07 �� Denver, CO 80203 Subject: Technical Revision 22 ( "TR -22 "); Grouting program at the Schwartzwalder Mine site in the vicinity of Sump 10 Dear Mr. Cunningham: In September, 2013 a major flood occurred in the area surrounding the Schwartzwalder Mine (the "Mine ") resulting in an increase in the mine pool elevation in the Mine to approximately 6680 feet elevation. Subsequent to this event, Cotter Corporation (N.S.L.) ( "Cotter ") has observed an increase in the water recovered at the Sump 10 area. At present, the rate is estimated to be 30 -40 gallons per minute. This water is being captured in Sump 10 and is subsequently pumped through the Water Treatment Plant ( "WTP ") which removes the uranium from the water prior to its discharge, under Colorado Discharge Permit System, Permit Number CO- 0001244, into Ralston Creek. In early 2011, Cotter proposed, via Technical Revision 16 ( "TR -16 "), to grout a core -hole that appeared to be a conduit for mine water to the outside environment. Approval was granted and the work accomplished within a few days. Cotter is proposing a similar effort to slow the rate of water being released into the Sump 10 area. A major portion of this water is from core -holes that were drilled in 2012. This work was terminated before the core -holes were grouted and, as a result, mine water has been leaking into the Sump 10 area. The objective of this proposed grouting program is to grout so as to seal the core -holes drilled in 2012 and reduce the potential for further seepage from the fractured rock strata within the Sump 10 area. Completion of this proposed grouting program is expected to take approximately three weeks. The water being collected in the Sump 10 area contains dissolved constituents, particularly manganese, that, upon interaction with oxygen, result in a precipitate buildup in the WTP IX- columns which prevents the uniform flow of water through the contained resin. This amorphous precipitate restricts flow through the IX- columns resulting in back - pressure building up that is potentially damaging to the internals of the IX- columns. Further, the water pumped from the Sump 10 area also contains levels of sulfate that reduce the metallurgical efficiency of the IX- columns in the WTP. d AF & Report Cotter Corporation(N.S.L.) v' Violations Telephone(720)554 -6200 7800 E. Dorado Place, Ste. 210 M V201 001 8 Fax (720) 554 -6201 Greenwood village, CO 80111 MV2010030 11/18/2010 MV2012027 9/12/2012