2019-11-22_REVISION - C1981019 (2)

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RULE 4 PERFORMANCE STANDARDS 4.23 Auger and Highwall Mining 4.23.1 Scope This Section establishes environmental protection performance standards in addition to those applicable performance standards in Rule 4, to prevent any unnecessary loss of coal reserves and to prevent adverse environmental effects from auger mining incident to surface mining activities. 4.23.3 Performance Standards 4.23.4 Maximize Recoverability of Mineral Reserves Colowyo has currently identified a number of areas that may be suitable for highwall mining that will be accessed from within the West Pit (refer to Map 23, Mine Plan). Highwall mining should allow for the recovery of additional coal resources beyond the currently permitted pit final highwalls and endwalls. These resources were not classified as reserves until the concept of highwall mining was conceived — all coal was previously classified as unmineable due to being uneconomic to mine either by modern surface or underground mining methods. From a strip mining perspective, the previously mined and future permitted limits of the East, West, and Section 16 pits clearly delineate the maximum recoverable coal resources attainable today with modern surface technology and coal market demand and pricing. The proposed highwall mining of many of the same seams around the perimeter and underneath the mined out pits, represents recovery of reserves that would not have been recovered by any other means utilizing either surface or underground mining techniques. The inability to recover these coal reserves by any other mining technique is primarily based on insurmountable geologic factors. The majority of all coal seams experience splitting and thinning to the point of not being economical to mine due to lack of adequate coal quality (unacceptable ash from coal seam splits that cannot be selectively mined from the seam) and/or coal seam thicknesses getting too thin to be mined from either the surface or underground. Additionally, all coal seams proposed to be mined by highwall mining, have experienced natural historic in place burning of the seams which severely limits the extent of mineable coal and also precludes finding intact outcrop locations from which to access these same seams by underground outcrop mining. To the north and east, changing geologic structure gives rise to severe dips and unstable fractured strata that also precludes mining by either surface or underground mining methods. Areas proposed for potential highwall mining activities are shown on Map 23. Colowyo was acquired by Tri-State Generation& Transmission Company in December of 2011. However, when Kennecott Energy Corporation acquired Colowyo in 1994, numerous optimization, exploratory drilling, geologic evaluation, and pre-feasibility studies and programs were undertaken to identify all future mining options. By year-end 2003,Colowyo completed pre- feasibility studies on three separate surface mining options and on underground mining options that evaluated all coal seams and all areas within Colowyo's Logical Mining Unit (LMU) and beyond. This comprehensive body of work definitively and unequivocally shows that all coal reserves proposed to be reeevered by highwa!4 mining methods have already been depleted by the Rule 4 Performance Standards 4-87 Revision Date: 11/18/19 Revision No.: MR-211