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Mr. William Berg, P.G. December 19, 2017 Page 2 of 5 Under Scenario B, there will be no mining on this site during the approval period and evaporation will occur from exposure of a total of 5.77 acres of water in four settling and wash ponds and in the mined cell for the entirety of the approval period. No operational losses will occur under Scenario B. In accordance with the letter dated April 30, 2010 (copy attached) from the Colorado Division of Reclamation, Mining, and Safety (“DRMS”), all sand and gravel mining operators must comply with the requirements of the Colorado Reclamation Act and the Mineral Rules and Regulations for the protection of water resources. The April 30, 2010 letter from DRMS requires that you provide information to DRMS to demonstrate you can replace long term injurious stream depletions that result from mining related exposure of ground water. In accordance with approach nos. 1 and 3, you have indicated that a bond has been obtained for $410,693 through the Division of Reclamation, Mining, and Safety (“DRMS”) to assure that depletions from groundwater evaporation do not occur in the unforeseen event, or events, which would lead to the abandonment of the Pit. DEPLETIONS Under Scenario A, mining will occur from March through November and will result in evaporation from a maximum of 4.57 acres of water in the five settling and wash ponds and a dewatering trench. Total estimated annual aggregate production is 684,000 tons per year (270,000 tons of sand mined below the ground water table and 414,000 tons of rock, chip, and waste mined above the ground water table). The water lost with 270,000 tons of sand mined below the ground water table is 7.92 acre-feet (4% by weight) for both 2017 and 2018. The total annual water consumption for dust suppression is estimated at 2.52 acre-feet for both 2017 and 2018. Your attached Table 1A shows the site net evaporation calculations (16.46 acre-feet) and water consumed by site operations (10.44 acre-feet). Effective precipitation credit was applied to this plan. Under Scenario B, evaporation will occur from exposure of a total of 5.77 acres of water in four settling and wash ponds and in the mined cell. Your attached Table 1B shows the site net evaporation calculations (20.27 acre-feet) and water consumed by site operations (0.0 acre-feet). Effective precipitation credit was applied to this plan. You have provided a monthly breakdown of lagged depletions at this site for each of the aforementioned scenarios in your attached Table 2. The Glover stream depletion analytical model was used to determine the lagged effects of the evaporation and operational losses from the mine. The model was developed for depletions to the Arkansas River under the following assumptions: ● X = 2,030 feet (the distance from the centroid of the exposed surface area to the river); ● W = 7,875 feet (the distance from the aquifer boundary through the exposed surface area to the river channel); ● T = 100,000 gal/day/ft (transmissivity of the alluvial aquifer between the well and the river); ● S = 0.2 (specific yield). Table 2 shows that under Scenario A, the lagged stream depletions during the period January 2017 through December 2017 are estimated to be 25.87 acre-feet and the lagged stream depletions during the period January 2018 through December 2018 are estimated to be 26.72 acre-feet. These estimates are based upon evaporative losses from the settling and washing ponds, mined cell, and dewatering trench, water removed in the mined product, and water used for dust suppression (see attached Table 1A). Depletions associated with refilling Pond 5 after the dewatering stops in July were accounted for in this request as shown in Table 2 under Scenario A. It was estimated that the mined cell (Pond 5) would return to its approximate current level (approximately 300 feet by 200 feet by 2 feet deep) within one month in November following mining. The volume of water refilled in the cell (2.75 acre- feet) was added to the total evaporation and operational losses in December 2017 and December 2018,