2016-01-04_INSPECTION - M2002020

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PERMIT #: M-2002-020 INSPECTOR’S INITIALS: PSH INSPECTION DATE: December 10, 2015 Page 3 of 10 reclamation at the site, however the parcel can be released from the 25th Ave Site and remain in the Greeley West permit until the reclamation is complete in the parcel. The Division will approve the release request for the southeast parcel from the 25th Ave Site since the parcel will remain in the Greeley West permit. The required reclamation of the topsoil berms, the east pond slope grading, the erosion gullies and the former house and tennis courts will be performed under the Greeley West permit. The Division will deny the release request of the southwest parcel from the Greeley West permit. The permit sign was posted at the entrance gate as required by Rule 3.1.12(1). Photographs taken during the inspection are attached. The Division received comments from the Colorado Division of Water Resources. A copy of the letter is attached for the Operator’s file. 38.25 acre north parcel The northern 38.25 acre parcel included in the release request was observed during the inspection. The parcel is defined by the Poudre River to the south, 35th Ave to the west and fence lines to the north and west. Cottonwood intends to retain the 0.24 acre parcel leased from Flatirons Sand and Gravel Company for access to O Street for the site. The Flatirons parcel was not included in the 25th Ave permit boundary as part of the 2012 amendment. The total future permitted acreage for the parcel would be 38.49 acres. The northern parcel vegetation consisted of native grasses and annual weeds. The parcel did not appear to have been disturbed by mining activities. Cottonwood stated the area was most recently used for agricultural equipment storage by a lessee. An oil and gas facility was observed in the middle of the parcel and residences are located north of the parcel. The City and Cottonwood will be required to transfer the Greeley West permit to Cottonwood through the Succession of Operator process as required by Rule 1.12. Cottonwood will be required to provide a financial warranty as part of the succession process. Cottonwood intends to lease the parcel to a mining company to mine the parcel. An additional Succession of Operator process will be required to transfer the Greeley West permit from Cottonwood to the future leased mining company. A technical revision to redefine the Greeley West permit area, or areas if the southeast parcel remains in the Greeley West permit, and update the mining and reclamation plans, once known, will be required by the Division. The Division will approve the release request for the north parcel from the 25th Ave Site since the parcel will remain in the Greeley West permit. 25th Ave Conclusions The release of the north and southeast parcels owned by Cottonwood from the 25th Ave Site appears appropriate since both parcels will remain in the Greeley West permit. Greeley West Conclusions The release of the majority of the overlapping permit acreage with the 25th Ave Site appears appropriate once it is clarified the southeast parcel will remain in the Greeley West permit. The bike path easement, railroad easement and 35th Ave easement acreage reductions, which have been released or excluded from the 25th Ave Site previously, as requested in the release request appears appropriate to be removed from the Greeley West permit. The Operator must submit a separate acreage reduction request for these areas in the future. The