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-' <br />(Page 2) <br />M1NE ID # OR PROSPECTING ID #: nn-1977-~~7 <br />INSPECTION DATE: a-n-nt <br />INSPECTOR'S INITIALS: ~_ <br />OBSERVATIONS <br />Completed a partial inspection of this site in order to meet with the operator to discuss various tasks and types of machinery <br />necessary to complete final reclamation and to determine an adequate bond to finance final reclamation. <br />The operator was presented with a financial warranty requirement for final reclamation cost estimates in March, 2001. The <br />estimated cost of reclamation was determined to be $566,974.00. The operator disagreed with the Division's estimate and <br />submitted its own estimate prepared by Monadnock Mineral Services (MMS). MMS estimated it would cost about <br />$229,000.00 to reclaim the site. <br />The Division re-evaluated the financial warranty in May, 2001 using the same tasks and equipment that MMS used; except <br />that equipment costs and labor costs were derived from the Cat and Means handbooks (MMS used local contractors' <br />equipment and labor costs). The re-evaluated financial warranty requirement was determined to be $482,419.00. This was <br />still considerably higher than the operator's estimate. <br />The operator asked if the Division would meet at the site to discuss the various tasks and machine efficiencies based on site <br />specific conditions. The Division agreed, so this inspection was scheduled. <br />Based on site specific conditions, the Division agreed to change, modify, eliminate or omit certain tasks and other <br />parameters. For instance, the weight of the soil used in the Division's evaluation was 2,650 fbs when, in fact, volcanic scoria <br />only weighs about 2, 000 lbs. If mixed with fines, the material may weigh up to 2,300 Ibs, but not 2,650 lbs. Cat push <br />distances were revised after reviewing material source areas. Also, push gradients were revised to reflect actual slopes. Aker <br />revising all the various tasks and parameters, the financial warranty requirement was, once again, re-evaluated. The DMG <br />feels the financial warranty requirement should amount to $397,142.00. <br />The operator has been notified of the latest estimate. In addition, the operator has been notified that an agreement between <br />the Division and the Permittee, on the cost of reclamation of the Mesita Hill mine site, shall be finalized on or before <br />August 20, 2001 or the Division will send the operator a Reason to Believe letter (that a possible violation exists). If the <br />parties agree to an acceptable financial warranty amount, the operator is required to post an acceptable bond with the <br />Division by September 17, 2001. <br />This is not noted as a problem since it is being handled with other bonding correspondence. <br />I & E Contact Address <br />NAME: Patrick Maestas James Stevens <br />OPERATOR: Colorado Aeereeate Co cc: ^ <br />STREET: 2255 Lava Lane ^ <br />CITY/STATE/ZIP: _ Alamosa. Co 81101 ^ <br /> <br />CE <br />BL <br />FS <br />HW <br />HMWMD (CH) <br />SE <br />WQCD (CH) <br />OTHER <br />