2023-09-20_BONDING - M1980047 - Laserfiche WebLink

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Colony Reclamation Cost Estimate, Update to Exhibit L Rev. Sept. 2023 Format and Cost Calculation methods, which are based on Means Heavy Construction Cost Data and productivity data from the Caterpillar Performance Handbook. This provides a concise and supportable cost for mine reclamation earthwork using various equipment fleets based on the most recent Caterpillar Handbook productivity. Although this document was developed to establish a uniform pro-forma methodology to calculate reclamation bonds for large Wyoming open pit coal mines, it provides an excellent reference point for similar mining earthwork projects in the Rocky Mountain west. Further, its cost data has been updated annually for many years and incorporates the appropriate costs for related reclamation items based on current Means Cost Data. The most recent update was December 2022. While the procedures and associated costs from the Wyoming Guideline 12 are based on recognized techniques, all of the equipment ownership and operating costs provided in the December 2022 update have been reduced by 30 percent compared to the actual Means Cost Data. As stated in the text of that document, this is based on very favorable conditions, massive quantities of materials moved in Wyoming, and have been compared to actual proprietary cost information from the various large mines. This is simply not the case for this SR-02 estimate. Rather, for this analysis, with more diverse conditions, higher elevations, and more challenging conditions, it is necessary to increase all ownership and operating costs provided in the WDEQ Guideline by a factor of 1.42. Accordingly, all unit costs for earthwork for this reclamation cost estimate have been multiplied by this amount. Note this adjustment only applies to the earthwork portions of the total cost. Unit costs for materials, which in this case consist of seed and mulch materials costs, were obtained from recent quotes from a local seed provider for the seeds specified in Table E-3 of the original permit applications. Current hydro-seeding costs (excluding seed materials) were obtained from a phone conversation with a western Colorado hydroseeding contractor. Seed costs for hydro-seeding were based on the quotes described above, although using a seeding rate double the drill seeding rate, as specified in Exhibit E. An assumed revegetation failure rate and consequent re-work rate of 20% was assumed for all revegetation work. Unit costs or ready-mix concrete delivered to Colony's Mine Bench were obtained via quotes from local suppliers. Slush-grouting on riprap channel bottoms and side slopes is taken as the delivered price of the ready-mix concrete plus a pump truck if needed. Poured concrete in forms is taken as the delivered price of the ready-mix concrete plus the same amount to cover the cost of forming and pumping, including a pump truck where necessary. Indirect Costs Basis and Inflation Escalation The direct reclamation costs have been calculated as described above and summarized on Table L-2. Contingency and estimates of other indirect costs have been added to the direct costs to arrive at a total bond amount as described on Table L-1. The amounts of the indirects as a percentage of direct costs have been selected in accordance with the general guidelines currently applied in Wyoming DEQ Guideline 12 for large coal mines. The Table L-1 value also includes escalation for 5 years at an arbitrary annual inflation rate of 3% to arrive at a bond amount that is expected to be adequate for at least five years. Expected Future Technical Revision, not Considered Herein This reclamation cost estimate was prepared in accordance with the specifications contained in Exhibit E of the permit application from 1980. In a few isolated cases, techniques that were considered standard practice back then have been replaced over the years. Notably, the use of Page 5