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(Page 2) <br />MINE ID # OR PROSPECTING ID # M-1992-049 <br />INSPECTION DATE 4/9/04 INSPECTOR'S INITIALS WHE <br />OBSERVATIONS <br />This inspection occurred as part of DMG's routine monitoring of permitted operations. The Peck Pit is <br />approved for 8 acres affected area. DMG holds $3,000 financial warranty. Approved activities are <br />limited to extraction of alluvial materials from gravel bars within the Uncompahgre River channel and <br />stockpiling of excavated materials. <br />Evidence of commencement of mining activities was not observed. A minor excavation, approximately <br />40 feet x 50 feet, was observed in the floodplain area of the channel. Several minor stockpiles of sorted <br />materials were located above the floodplain areas. Mr. Zimmerman indicated that the excavated material <br />had been extracted by the landowner, for use on the same parcel and would not be exported. Mr. <br />Zimmerman indicated that the excavated material was being utilized to support construction of a new <br />residence on the property. DMG observed the new construction, well under way, near the stockpiled <br />material. Anew entrance road to the residence has been constructed from Hwy 550. <br />The existing $3000 financial warranty covers the cost of reclamation for 2 acres affected area. Since <br />mining activities have not commenced the existing financial warranty appears sufficient to ensure <br />reclamation for the first year of operations. <br />No problems or possible violations were observed. <br />Responses to this inspection report should be directed to the Division of Minerals and Geology, 701 <br />Camino del Rio, Room 125, Durango, Colorado 81301, Attn: Wally Erickson, phone no. 970-247-5469. <br />I & E Contact Address <br />NAME Keith Zimmerman <br />OPERATOR Vista Verde Village. LLC <br />STREET 17449 Hwv550 <br />CITY/STATE2IP Ridawav. CO 81432 <br />cc: Harry Posey, DMG <br />^ CE <br />^ BL <br />^ FS <br />^ HW <br />^ HMWMD (CH) <br />^ SE <br />^ WQCD (CH) <br />