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(Page 2) MINE ID # OR PROSPECTING ID #: M-1992-102 INSPECTION DATE: 2/17/05 INSPECTOR'S INITIALS GRM OBSERVATIONS This inspection was conducted as part of the normal monitoring program established by the Colorado Division of Minerals and Geology. The South D 20 Pit is located south of Montrose off of Ranger Road. Mr. Milan Hawxby represented the operator for this inspection. The D-20 Pit is an active 112c permitted site. Approximately 16.5 acres of permitted azea is under mine disturbance. Another approximately 5.5 acres has been reclaimed or not disturbed in the front area along the southwest and west. Operator exploration has noted that the resource in this area has diminished and probably will not be disturbed by excavation. The mine identification sign and affected area boundary mazkers aze in place and in compliance with Rule 3.1.12. The sign is posted at the entrance off ofRanger Road. The boundaries are either fences or the mesa edge which will be daylighted when mining is complete. The reclaimed,azea.is noted as having 3:1 slopes on the eastern aspect down to the pit floor. Slope vegetation includes rabbitbrush, four winged saltbush, some wheatgrass as well as cheat grass. The area is equal to the surrounding area in vegetation diversity and density. An area of lowland wetlands has established inabout a'/< acre which includes willows, canary grass, and cottonwoods. There is some noxious weeds along the fringe, but the plants appear to have been sprayed. The inspector would encourage the operator to consider release of this noted azea to reduce overall reclamation liabilities. Should tamarisk or other noxious weeds appear the operator would be responsible for control of them. An expense that can be avoided by timely release of reclaimed azeas. In the active mine area, there aze several stockpiles of processed and raw materials.. Highwalls appear to be roughly 15 feet and run in a general west to east face. There is an equal highwall along the south, but this material is to be pulled back towazds the pit azea and daylight the pit edge upon completion. Topsoil piles are noted along the western edge of current disturbances. The material has been piled on top of an area noted for future excavation. The inspector notes that at this time no topsoil appears to have been mixed in with mined materials. However, the operator must take measures to ensure that the topsoil is protected from loss do to erosion or excavation. There appears to be some vegetation growth on the piles but mostly volunteer in nature. The protection of topsoil is not being listed as a problem, but is noted for future monitoring. No hazardous materials or waste were noted on site. Stormwater evidence appeazs to show drainage is kept within the pit area and drains out rather quickly. No off site disturbance is noted. A power line pole that sits in the current excavation area has been staked out approximately in a 75 foot radius which is more than the 50 foot requirement. The area is stable and protected. The bond was last reviewed in March of 2001. No maj or issues appear to change the over all configuration, mining or reclamation methods. Therefore, staff will update the bond using accepted tasks from 2001. The operator can expect a review of the bond within the next 30 days. No issues aze noted at this site at this time.