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SETTLEMENT AGREEMENT JUSTIFICATION <br />Energy Fuels Coal, Inc. <br />Southfield Mine, Permit No. C-1981-014 <br />Notice of Violation No. CV -2017-003 <br />Cessation Order No. CO -2017-003 <br />Wallace H. Erickson, Conference Officer <br />According to the public records of the Division of Reclamation, Mining and Safety (Division), the <br />original permit for the Southfield Mine was issued on July 30, 1984, for approximately 2,735 <br />acres affected lands for the life of mine. Of the original 2,735 acres, Energy Fuels Coal, Inc. <br />(Permittee and/or Operator) has achieved complete reclamation and has attained the Division's <br />approval for release of approximately 2,733.55 acres. The current permit is reduced to 1.45 <br />acres affected lands. The Division holds $10,000 financial warranty to ensure the completion of <br />reclamation, in the event of permit revocation and forfeiture of the financial warranty, for the <br />remaining 1.45 acres affected lands. <br />Notice of Violation No. CV -2017-003 was issued by the Division on May 23, 2017. The violation <br />was issued for failure to maintain mine and permit identification signs, as required under C.R.S. <br />34-33-122(5) and Rule 4.02.2. The single abatement step identified by the Division required the <br />Operator to reinstall the mine and permit identification signs, in accordance with Rule 4.02.2. <br />The Division set the abatement deadline at June 30, 2017. <br />On June 30, 2017, the Assessment Officer assessed a civil penalty for CV -2017-003 as follows: <br />• History— appeal period for violations had not yet expired $0.00 <br />• Seriousness — Moderate $500 <br />• Fault — Intentional $1,500 <br />• Number of Days Penalty Assessed <br />one day <br />• Good Faith $0.00 <br />Total proposed penalty $2,000 <br />The Operator did not pay the civil penalty and failed to abate the violation, resulting in <br />Cessation Order No. CO -2017-003. Cessation Order No. CO -2017-003 was issued July 12, 2017. <br />On August 8, 2017, the Assessment Officer assessed a civil penalty for CO -2017-003 as follows: <br />• History— appeal period for violations had not yet expired $0.00 <br />• Seriousness — Significant $1,000 <br />• Fault — Intentional $1,500 <br />• Number of Days Penalty Assessed 16 days <br />• Good Faith 0.00 <br />Total proposed penalty $40,000 <br />