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PERMIT#:P-2012-011 <br /> INSPECTOR'S INITIALS:MAC <br /> INSPECTION DATE: December 8,2015 <br /> OBSERVATIONS <br /> The inspection was conducted by Michael Cunningham of the Division of Reclamation, Mining and Safety <br /> (Division). The Operator was not present for the inspection. The Smuggler Gold Mine prospect site is located <br /> approximately 2 miles southwest of Rollinsville, Colorado in Gilpin County. There was between 6 to 12 inches <br /> of snow cover on the ground at the time of the inspection. <br /> The operation was not active at the time of the inspection and the Division did not observe any signs of recent <br /> activity at the site. The Operator was authorized to conduct portal rehabilitation and underground sampling at <br /> the Smuggler Gold Mine. The former portal structure was removed and replaced with a timbered portal which <br /> was built out approximately 10 feet from the hillside. The hillside surrounding the portal was terraced and <br /> graded so that it sloped down to the sides of the portal.The hillside above the portal was stable and did not <br /> show any signs of erosion. The portal was securely locked and warning signs were posted on the doors. The <br /> area immediately in front on of the portal contained two small waste-rock piles, with approximately 30 cubic <br /> yards of material. A fuel tank was observed in the vicinity of the portal; the tank was empty. <br /> The Division observed a 4 inch stainless steel pipe extending from the portal entrance approximately 80 ft. The <br /> piping appears to be related to the underground ventilation system. A trailer mounted Ingersoll-Rand air <br /> compressor was located near the end of the stainless steel pipe. A modified shipping container was located <br /> immediately south of the portal. The Operator constructed a three-sided wooden shed on the side of the <br /> shipping container. These facilities housed the office, parts room and safety room. A small stand-alone shed <br /> was constructed on the south side of the shipping container, it appears this shed previously housed a <br /> generator or heating unit. Finally, the Division observed a partially enclosed wood structure with a corrugated <br /> metal roof located south of the shipping container. This structure was used for the portable saw mill; no <br /> equipment was present. <br /> The Division has not received Annual Reports or Annual Fees for 2014 or 2015 and the Division has been <br /> unable to reach the Operator in regard to the outstanding Annual Reports and Fees. The Division has reason to <br /> believe the Operator is in violation of C.R.S. 34-32-116(4) and Rule 5.6, and have scheduled this matter to <br /> appear before the Mined Land Reclamation Board at the December 16, 2015 Board meeting. Notice of the <br /> Board Hearing was sent under separate cover. <br /> The Division currently holds a financial warranty in the amount of$17,200.00. The Division has determined <br /> that the financial warranty is adequate to complete reclamation. <br /> This concluded the inspection. <br /> Page 2 of 5 <br />