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(Page 2) MINE ID # OR PROSPECTING ID # M-1977-424 INSPECTION DATE 8-29-2005 OBSERVATIONS INSPECTOR'S INITIALS SSS This inspection was conducted to observe the ongoing reclamation efforts on the waste rock dumps, to observe the remedial actions taken to fix the damage from erosion incurred during a large precipitation event that occurred in 2004. Reclamation of the facilities area around the portals and mine dumps continues. The sealed portals show no sign of seepage and appear to be stable. Shrubs planted on the dump faces in 2003-2004 appear to be surviving, thanks in part to a relatively moist, cool summer. Stormwater drainage features have been constructed per Technical Revision No. 5. The permittee will need to submit engineer certified as-built diagrams for these structures demonstrating that they meet or exceed the design criteria and highlighting any revisions to the designs that were made due to field conditions. Installation of the research mine drain system is underway with the new vault, valves and emergency bypass complete and the pipeline to dry gulch being about one-third complete. The trenching for this reach of pipe hit bedrock just under the surface along the toe of the road cut. To remediate this, the pipeline will be moved further out into the fill slope to accommodate the requirement for 4 feet of cover material. This adjustment is to be covered in certified as-built drawings upon completion of this project. To minimize potential stability problems, the consultant to the permittee was cautioned not to move the pipeline out into the fill any farther than necessary to achieve the required depth. Topsoil from the recently permitted borrow area is being hauled to reclamation sites at the toe of the lower waste rock dump including the heater treater /meteorological station (area 22), the location of the pilot passive water treatment system and to cover some of the wasterock deposition from the large storm event of early summer 2004. Topsoil placement on this area is nearly complete. Trucks will begin hauling topsoil to the upper mine bench later in the day. The remainder of the inspection was dedicated to verifying completion of reclamation on the sites where fnancial warranty release was requested by the permittee through submittal of Surety Release Request No. 1 (SL-01). Areas 5, 6, 7, 8, 9, 14, 15, 16, 17, 19, 20, 21 have had all structures removed, final grading was performed and available topsoil was replaced. All are well vegetated with beneficial perennial species most of which are producing seed. Most areas have a nicely balanced mix of grasses, fortis and shrubs with very few noxious weeds. These areas appeared to be stabilized and eligible for release. Through approval of Technical Revision No. 1 in 1986, Area 12, the meteorological tower, had the end land use changed to a radio station facility. The radio tower facility is currently in place and all access roads around the facility are well vegetated and stabilized. This area meets the specifications of the reclamation plan and appears to be eligible for release. Through approval of Succession of Operator No. 1 in the early 1980s, Area 11, the guard gate area (8.3 acres), was removed from the permit. In area 13, approximately 9.5 acres of access roads have been adequately reclaimed (including section 612) leaving approximately 6 acres of access roads remaining to be reclaimed. Area 18, the public road (Logan Wash Road), was realigned in the early 1980s to straighten some curves. This resulted in a requirement for reclamation of areas 61-610 wfiich were the cut-off sections of curved road. Surety Reduction No. 1 in 1986 released all of these except B2, B3, 67, B8. Fencing to protect these areas from grazing has been removed and these sites are very well vegetated. Upon removal of some piled up fencing materials from the B3 area (or possibly BS), these areas will be eligible for release. Area 10 was recently had a stock pond excavated into the north end for the landowner. The landowner is responsible to ensure the stock pond banks are stabilized. The south end of this area has been used for equipment staging, parking, etc. by many entities. The permittee will need to fence off this location and perform reclamation as specified in the reclamation plan, or revise the post mining land use to leave this as a parking area. This will require a signed, notarized authorization from the landowner. Area 10 is not currently eligible for release.