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COLORADO <br />Division of Reclamation, <br />Mining and Safety <br />Department of Natural Resources <br />1313 Sherman Street, Room 215 <br />Denver, CO 80203 <br />February 17, 2016 <br />Scott Wanstedt <br />Blue Mountain Energy <br />3607 County Rd. 65 <br />Rangely, CO 81648 <br />RE: Deserado Mine, Permit No. C-1981-018 <br />2015 Annual Hydrology Report <br />Dear Mr. Wanstedt, <br />The Division received the 2015 Annual Hydrology Report (AHR) on January 28, 2016. Thank you for your <br />timely submittal. The Division finds the 2015 AHR is in compliance with the following Rules: <br />Rule 4.05.13(4)(a) - The data collected for the 2015 AHR is kept and maintained at the Deserado Mine <br />Office. <br />Rule 4.05.13(4)(b) - The 2015 AHR is compiled from the analysis of hydrologic data collected from the <br />monitoring period of October 1, 2014 to September 30, 2015. <br />Rule 4.05.13(c)(i), (ii), (iii) - The 2015 AHR was submitted to the Division by the determined date on <br />which the permitee and the Division agreed to. The report included an interpretation of the collected <br />data and identified mining related impacts to the hydrologic balance. <br />The 2015 data supports the predictions of the Probable Hydrologic Consequences (PHC) of the Deserado <br />Mine permit. The following is a review of the 2015 data as per the PHC: <br />The impact on the quantity of water to the White River was minimal, only 93,106,254 gallons or <br />286 acre-feet was withdrawn from the White River in the 2015 water year. This is less than the <br />projected 552 acre-feet per year. Groundwater inflow is usually 20 to 40 gallons per minute <br />(gpm), occasional increased inflows occur when a localized perched water table is encountered. <br />Other inflows to the mine are the result of water from leaks and water line brakes. The total <br />incidental inflow of water into the mine was 9.00 gpm in the 2015 water year. The value is in <br />the predicted range of 5 to 10 gpm. In May of 2012 a dewatering pump system was installed to <br />pump excess water captured in the underground mine to the surface. Water pumped to the <br />surface from the B Seam was 14,449,464 gallons or 27.49 gpm. Water pumped from the D Seam <br />was reinitiated at the SDH -3/5 Pond, pumping began in July of 2015. A total of 21,306,225 <br />gallons or 40.54 gpm was pumped to the surface through the SDH -3/5 system. <br />1313 Sherman Street, Room 215, Denver, CO 80203 P 303.866.3567 F 303.832.8106 http://mining. state. co. us <br />John W. Hickenlooper, Governor I Mike King, Executive Director I Virginia Brannon, Director <br />