2020-09-17_APPLICATION CORRESPONDENCE - X202023203

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Lorencito Canyon Notice of Intent No holes are being planned to be developed as water wells; however, if water is detected during drilling and the water production is great enough that it can be used by either the property owner or New Elk, the hole will be converted to water well and the appropriate permit will be filed through Colorado Division of Water Resources. 6. Attach a statement with appropriate references from the relevant State or Federal agencies or published sources, which determines that the exploration and reclamation described will not jeopardize the continued existence of an endangered or threatened species listed pursuant to Section 4 of the Endangered Species Act of 1973 (16 U.S.C. 1533) or the Nongame, Endangered or Threatened Species Conservation Act (Section 33-8-101 et seq. C.R.S. 1973) or result in the destruction or adverse modification of critical habitat of those species. (Rule 2.02.2(2)(h)) An Environmental Assessment (number DOI-BLM-CO-200-2009-0018 EA) was conducted by the US Department of Interior for federal parcels located in T33S R67W sections 18, 19, 6, and 17 and in T33S R68Wsections 1, 12, and 13. These federal parcels are roughly 45,000 feet northwest from the center of the Lorencito Tract. These federal parcels are the closest federal parcels to the Lorencito Tract. The finding on the threatened, endangered, and sensitive species indicates that there are no records for any threatened, endangered or BLM sensitive species in this area. The study notes that mining activities will not impact TES species. The close proximity and similar general topography and hydrology make this Environmental Assessment the best reference. 9. Have reclamation costs been included with this Notice to assist in determining the amount of Performance Bond Required. Table 4 Estimated Direct Cost Bonding Requirements shows the calculation of the Direct Cost for the Performance Bond. The direct reclamation cost for the entire project is estimated to be about $45,000. Table 5 Estimated Total Bonding Requirements shows the calculation of the Performance Bond including mobilization, job superintendent, profit, engineering, and management. The total reclamation cost for the entire project is estimated to be about$78,000. The following assumptions were used for the bonding requirements below: Reclamation of each mud pit is $200.00 Regrading each pad is $288.00 Reseeding each pad is $22.00 Regrading New Roads is $0.16 per foot of linear disturbance Reseeding New Roads is $0.09 per foot of linear disturbance Sealing and Plugging Holes is$3.62 per foot of hole depth Mobilization to each location is $500.00 13 2020 Exploration Program 9/9/2020