2010-12-15_GENERAL DOCUMENTS - M1990049

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Colorado Inactive Mine Reclamation Program CLOSEOUT REPORT ACTIVE MINE BOND FORFEITURE PROJECTS Permit Information Permit Number Operator Name Mine Name M-1990-049 Solution Gold, Ltd. Druid Project(Kokomo Mine) Type of Mine—Surface Commodity Mined- Gold PRE-RECLAMATION SITE CONDITIONS The Druid Mine is within the Central City/Clear Creek Superfund Site located approximately 30 miles west of Denver, Colorado. The Druid Mine consisted of three (3) previously permitted mine sites, each of which has had the operating permit revoked and the reclamation bonds forfeited by the Colorado Mined Land Reclamation Board in 1994. Each site was subsequently reclaimed using the forfeited funds (Permit No M-1990-049, M-1991-049 and M-1992-090). In 1983, the U.S. Environmental Protection Agency (EPA) listed the Druid Mine on the National Priorities List(NPL). Colorado Department of Public Health and Environment(CDPHE) and EPA have worked together on the site with CDPHE acting as the lead agency since 1988. An approximately 35-acre parcel of the Church Placer claim was chosen by the EPA and CDPHE as the on-site repository to be constructed within the Central City/Clear Creek Superfund Area. This property was acquired by the State of Colorado on October 30, 2008. The repository will provide a location for the consolidation of waste rock and tailings piles, water treatment solids, and metals contaminated sediment under Operable Unit 3 (OU 3 ROD) and Operable Unit 4 (OU 4 ROD). The Druid Mine/Church Placer waste falls within the OU 4 ROD Operable Unit. The Kokomo Mine and waste rock pile is on the Church Placer repository parcel owned by the State of Colorado. On May 1, 2009, the DRMS and CDPHE entered into an Interagency Agreement to reclaim the Kokomo portion of the Druid Mine/Church Placer. The DRMS assisted in reclamation of the site by funding the relocation of the metals-contaminated waste rock material from the Kokomo Area to the CDPHE mine Waste Consolidation Area. The Kokomo dump is approximately one acre in size and at one time was estimated to contain approximately 15,000 tons of material. A majority of the dump was removed by Solution Gold under the approved mining permit. Only the remnants of the dump remain, but no vegetation has established due to the acidic soils. The remaining Kokomo dump consists of intensely weathered gangue material composed of resistant quartz, with the feldspars and other minerals broken down to clay minerals. Metallic minerals are predominantly pyrite and minor amounts of galena and sphalerite. Test holes dug on the Kokomo dump in November, 2008 reveal that the depth of material ranges from 8 inches along the western edge to 48 inches near the middle of the dump. BIDDING/CONSTRUCTION INFORMATION Type of Bid Documented Quote Purchase Order (circle one) Formal Interagency Agreement Contractor Name&Address: Construction Severance Tax-$33,282.00 Contract: Dates: #09 PKA 00049 Interagency Agreement with CDPHE. McCollum's Start: 7/13/2009 Excavating was the general contractor Date: May 1, 2009 End: 6/8/2010 Project Cost: $33,282.00 Construction Work Description Construction began on July 13, 2009 with equipment and materials being mobilized to the project site and silt fence installed around the disturbed area. Approximately 4,000 cubic yards of Kokomo waste rock was excavated to the underlying native soils and placed in the CDPHE on-site repository located approximately 500 feet to the west. Placement of the material in the repository fell under the CDPHE guidelines and requirements for placement, compaction and final reclamation. The remaining sub-soil material beneath the Kokomo dump footprint was graded so the surface blended in with the surrounding area. In the Spring of 2010 the remaining soils were amended with 10 tons of limestone and 25 cubic yards of organic material and were ripped into the soil. Mulch was then applied to the ground surface at a rate of 2 tons per acre and the area was scarified to create large gouges to minimize surface erosion and improve growth medium potential. The 1-acre area was then broadcast seeded with the Ponderosa Pine/Spruce/Fir seed mixture in the Spring of 2010.