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2801Youngfield Street, Suite 171 <br />Golden, CO 80401-2266 <br />303-456-5638 <br /> Toll Free 888-456-5638 <br />Fax 303-456-5639 <br />www.mathesonmining.com <br />December 22, 2011 <br />Mr. Timm Comer <br />Manager, Environmental Resources <br />Cripple Creek & Victor Gold Mining Company <br />P. O. Box 191 <br />Victor, CO 80860 <br />Re: Ground Motion Attenuation Studies: Cresson Project Mine Life Extension 2 <br />Dear Mr. Comer, <br />Matheson Mining Consultants, Inc. (MMC) has completed a technical evaluation of the proposed mining areas <br />as part of Cripple Creek & Victor Gold Mining Company’s (CC&V) Cresson Project Mine Life Extension 2 <br />(MLE2) Project as it relates to current blasting and monitoring programs at the Cresson Project. The current <br />production blast monitoring program and conclusions presented and approved from previous evaluations <br />conducted at the Cresson Project are sufficient for the proposed mining areas presented within the MLE2 <br />Project at the Cresson Project. <br />MMC has conducted seven separate Ground Motion Attenuation Studies for CC&V at the Cresson Project. <br />CC&V had two similar studies completed by Vibra-Tech Engineers prior to 1997. Those studies were <br />conducted to develop site-specific scaled distance criteria for each mining area. Those site-specific scaled <br />distances criteria remain valid for the proposed mining areas associated with the proposed MLE2 Project. <br />Summaries of those studies are attached to this evaluation. The various studies show a high degree of <br />consistency and the ground vibrations created by the production blasting at the Cresson Project have never <br />exceeded the peak particle velocities predicted by the studies. Slight variations in ground motion attenuation <br />have been noted in varying directions and varying production blasting locations. All of the principle directions <br />from production blasting areas toward residential structures have been studied and ongoing production blast <br />vibration monitoring has confirmed the conclusions of the studies. Further ground motion attenuation studies <br />are not warranted for development of the proposed mining areas associated with the MLE 2 Project. <br />CC&V has had an on-going monitoring program in place where five or more seismographs are set out and <br />monitor every production blast at various points of concern surrounding the Cresson Project. Peak particle <br />velocities measured at the closest occupied non-mine owned structure have never exceeded 33% of the current <br />permit level and typically are less than 20% of the permit level of 0.5 inches per second (IPS) of ground <br />vibration. All blast vibrations data that have been measured at the closest off-site structure during production <br />blasting at the Cresson Project have been in compliance with United States Bureau of Mines Report of <br />Investigations 8507, Colorado Department of Natural Resources Division of Reclamation, Mining and Safety <br />and all mining permits. Compliance with the blast vibration regulations precludes any probability of damage to <br />even the most sensitive structural elements in homes including historically significant structures. <br />MMC has conducted periodic reviews of the blast vibration and air overpressure monitoring program, and all <br />subsequent data obtained from those programs. The instrumentation used for production blast monitoring has <br />been annually calibrated and meets or exceeds industry standards. Field procedures are consistent and <br />thorough and meet or exceed the guidelines outlined by the International Society of Explosives Engineers and <br />the United States Bureau of Mines. Complaints that may be received from production blasts at the Cresson <br />Project are investigated and seismographs are deployed at complainant structures to quantify potential <br />production blast effects at those individual structures.