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PERMIT#: M-2010-008 <br /> INSPECTOR'S INITIALS:TCW <br /> INSPECTION DATE:October 18,2016 <br /> OBSERVATIONS <br /> This was a routine monitoring inspection conducted by TC Wait of DRMS; Mr. Ray Sikes (land owner) was <br /> present representing the operator. The site is located about 18 miles southwest of Pritchett on the north side <br /> of Carizzo Mesa. The site was last inspected in May 2010 at permitting. At the time of this inspection, the site <br /> was dry and mining operations were occurring along the northeastern side of the site, moving to the east. Mr. <br /> Sikes stated that the plan was to move east to daylight at the haul road. The entrance road was marked with <br /> the permit sign and the permit boundaries were marked with t-posts. The permit area is 67 acres with an <br /> additional 2 acres of access road. Based on aerial photography estimates (GoogleEarth, 6/22/2015), the <br /> disturbed area is approximately 12.2 acres. <br /> Native topsoil on the basalt cap is minimal, but Mr. Sikes confirmed that topsoil has been preserved along the <br /> edges of the excavation. A stockpile of about 10,000 tons of crushed material is located in the southwest part <br /> of the disturbed area. The pit highwall was about 40-50 ft high toward the north of the site. Some tension <br /> cracks were noted along the perimeter of the highwall adjacent to the slope face. At the time of the <br /> inspection, drilling for the next blast was occurring on the east side of the pit. A crusher and conveyors were <br /> on site as well as a water truck for dust control. No reclamation work has been done at this point. <br /> Minimal erosion was noted on the site. The haul road was bermed to prevent water runoff down the slope <br /> face. No evidence of standing water was observed in the pit. Weeds were not observed in the disturbed area. <br /> The site is generally stable and in good condition. <br /> RECOMMENDATIONS: <br /> 1. As mining progresses, the Operator should work to establish the final stable grades. <br /> 2. The Operator should verify with the blasting contractor that the pertinent blast plan and records <br /> are being kept in accordance with the DRMS permit. <br /> 3. Bond evaluation should be done at the time of the next DRMS inspection. <br /> Page 2 of 6 <br />