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June 25, 2013 C-1981-018/Deserado Mine <br />Inspection Topic Summary <br />NOTE: Y=Inspected N=Not Inspected R=Comments Noted V=Violation Issued NA Not Applicable <br />N - Air Resource Protection <br />R - Roads <br />R - Availability of Records <br />Y - Reclamation Success <br />N - Backfill & Grading <br />Y - Revegetation <br />N - Excess Spoil and Dev. Waste <br />N - Subsidence <br />N - Explosives <br />N - Slides and Other Damage <br />N - Fish & Wildlife <br />N - Support Facilities On-site <br />R - Hydrologic Balance <br />R - Signs and Markers <br />Y - Gen. Compliance With Mine Plan <br />N - Support Facilities Not On-site <br />R - Other <br />N - Special Categories Of Mining <br />R - Processing Waste <br />Y - Topsoil <br />COMMENTS <br />ZTT <br />This was a complete inspection of the Deserado Mine by Zach Trujillo of Colorado Division of Reclamation, <br />Mining and Safety (DRMS) conducted on June 24, 2015. Scott Wanstedt of Blue Mountain Engergy, Inc. (BME) <br />accompainied the inspection. The weather was clear with the ground dry. No recent precipitation event had <br />occured prior to the inspection. Temperatures for the day were around eighty five degrees fahrenheit. <br />AVAILABILITY OF RECORDS — Rule 5.02.4(1): <br />All records are kept on site at the Deserado Mine's office building with Scott Wanstedt. Please see the Division's <br />Availability of Records checklist at the end of this inspection report for more detailed information. <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 />Pond DP -1 is the primary pond for the entire facility area. The pond's embankments were stable and vegetated. <br />The primary discharge is a riser pipe with the inlet was clear of debris. The emergency spill way was well <br />armored with rip rap and a concrete cutoff wall. The main channel from the intermediate facility bench was <br />stabilized with rip rap. No cutting or instability was observed. The secondary channel for the same facility bench <br />was also stable and showed no signs of cutting. The beginning of the secondary ditch is constructed with a rock <br />check dam as additional sediment control prior to entering Pond DP -1. <br />Ponds PP -1 and PP -2 collect partial runoff from the facility area. PP -1 is an in situ pond located just below the <br />refuse bin and truck loadout. No issues were noted. Pond PP -2 is semi -in situ with its main embankment stable and <br />vegetated. The spillway is a combination primary/emergency riser pipe spillway. It was noted in the previous <br />inspection that the bottom section of the embankment of Pond PP -2 was partially saturated. A follow up inspection <br />to the sit efound no signs of saturation to the embankment. Scott Wanstedt said it was most likely a leak in the <br />Number of Partial Inspection this Fiscal Year: 8 <br />Number of Complete Inspections this Fiscal Year: 4 <br />Page 2 of 6 <br />