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February 3,2022 <br /> Karl Nyquist—Prowers Aggregate Operators, LLC <br /> J.Curtis Marvel,Jr.—Brannan Sand and Gravel Company, L.L.C. <br /> Page 2 of 3 <br /> agreement form)that was sent to each structure owner, and a Certified Mail Receipt demonstrating the <br /> letter was delivered. For SO-04, the Prospective Successor has thus far provided only photographs of <br /> letters that appear to have been sent via Certified Mail,but do not include an address for the recipients. <br /> In reviewing the names provided on the envelopes, it would appear all structure owners identified in <br /> AM-02 were included, except Prowers County. For SO-04 approval, the Prospective Successor will <br /> need to provide copies of the notarized structure agreement forms that were mailed to each structure <br /> owner and the Certified Mail Receipts demonstrating the letters were delivered. Additionally, the <br /> structure agreement for Southeast Colorado Power Association must include similar language as the <br /> agreement obtained by the current Permittee, acknowledging the power lines owned by this entity will <br /> be relocated during the mining operation. <br /> 2) The Prospective Successor states in SO-04 "all structure agreements in place on November 18, 2022, <br /> were assigned by the Permittee to Brannan as Brannan simultaneously assumed these contracts" and <br /> that `Brannan's initial SO-04 submittal contained the transactional documents demonstrating this <br /> transfer of responsibilities to the Prospective Operator". While the Division does accept the <br /> "transactional documents" provided with SO-04 as sufficient demonstration of the Prospective <br /> Successor's legal right to enter the affected lands to conduct mining and reclamation,these documents <br /> do not fulfill the requirements of Rule 6.4.19. Please see Item No. 1 above for a description of what is <br /> required for SO-04 approval with regard to structures. <br /> 3) The Prospective Successor states in SO-04 "the statute on succession of operators specifies that, when <br /> one operator succeeds another at an uncompleted operation, the board shall release the first operator <br /> from all liability as to that operation and shall release all applicable performance and financial warranties <br /> as to such operation if the successor operator assumes all liability for the reclamation of the affected <br /> land and such obligation is covered by appropriate performance and financial warranties". Please be <br /> advised,the warranties held by the current Permittee will not be released until the Prospective Successor <br /> has fulfilled all applicable requirements of the Succession of Operators process (including posting the <br /> required financial warranty)and SO-04 is approved. <br /> 4) The Prospective Successor states in SO-04 "the determination of a Financial Warranty of a greater or <br /> lesser amount than the existing Financial Warranty is part of the succession of operator process", that <br /> "construction of the new slurry wall was underway for Phases 2, 3, and 8 on November 18,2021" and <br /> "based on the then-anticipated completion of work by the end of 2021, we deemed it relevant that a <br /> likely reduction in the actual site reclamation obligation is pending". Please be advised, the financial <br /> warranty amount cannot be reduced through the Succession of Operators process. This can only be <br /> done through the Division's review and approval of a Surety Reduction request (which cannot be <br /> reviewed at the same time a Succession of Operators application is under review). Through the <br /> Succession of Operators process,the financial warranty amount can remain the same or be increased.In <br /> this case, the required financial warranty amount was recently assessed through AM-02, issued on <br /> December 29,2021.Therefore,the Division does not expect the required financial warranty amount for <br /> this operation to increase for SO-04 approval.This is why the Division recommended in its January 4, <br /> 2022 letter that Option 2 be selected to help expedite the review process for SO-04. Since Option 1 was <br /> again selected in the revised application,the Division will inspect the site within 60 days in accordance <br /> with internal policy. However, the Prospective Successor should be aware, the existing financial <br /> warranty amount of$8,310,769.00 must be posted by the Prospective Successor in order for SO-04 to <br /> be approved. Once the permit transfer process has been finalized through SO-04 approval, the new <br />