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(Page 2) MINE ID # OR PROSPECTING ID # M-1980-003 INSPECTION DATE10-29-2002. INSPECTOR'S INITIALS SSS OBSERVATIONS This was a routine inspection conducted as part of the Division of Minerals and Geology s ongoing monitoring program for permitted mines in Colorado. The inspection was also conducted to evaluate the Current site conditions for use in updating the reclamation cost estimate to ensure the financial warranty currently held by the state is adequate to reclaim this site. The mine identification sign was observed but was not in compliance. Some affected area boundary markers were in place but not enough to make the permit boundary readily identifiable. Please install a mine identification sign and adequate boundary markers per the requirements of Rule 3.1.12 that state: 1} The operator shall post a sign at the entrance to the mine site which shall be clearly visible from the access road and specify the following: a) The name of the operator; b) indicate that a reclamation permit far the operation has been issued by the Colorado Mined Land Reclamation Board; c) the permit number. 2) The boundaries of the affected area will be marked by monuments or other markers that are clearly visible and adequate to delineate such boundaries. The lack of an identification sign and boundary markers is noted as a problem with the corrective action(s) and correction date specified on the last page of this report. As with past inspections, this inspection raised questions about the permit boundary locations and possibility of off-site disturbance. This situation arises mainly due to the poor maps currently in the permit. The operator indicated that a new survey of the actual permit boundary was done a couple of years ago to clarify the actual boundary locations. Please submit this map, as a technical revision to the permit, so future confusion regarding the boundary can be avoided. Please ensure the map meets the requirements of Rule 6.2.1(2), and 6.3.5 (copy enclosed), showing and labeling all operation features including product stockpiles, waste rock stockpiles, topsoil stockpiles, processing facilities, hazardous materials storage with spill containment, current highwall locations, etc. It would also be very helpful if all adjacent disturbance is shown and labeled including pre-1976 mining features that have not been affected by this operation and storage and equipment salvage areas that support the ranching operation and not the mining operation, Noxious and/or problematic weed infestation was observed within the affected area. The infestation of Canada thistle, if not controlled, will most likely hinder and/or delay successful reclamation of this site and contribute to off-site spreading and establishment of these weeds. A weed control plan developed in consultation with, and approved by, the appropriate local weed control authority must be submitted as a technical revision to this permit. Weed infestation is noted as a problem, with the corrective action(s) and correction date specified on the last page of this report. Significant progress toward control of on- site weeds must be demonstrated within three years to avoid potential Board action. A 55 gallon drum and a couple of 5 gallon buckets reportedly containing hazardous materials were not stored within adequate spill containment. A portable fuel tank was also to be moved onto the site. The operator was instructed to ensure these materials are stored and maintained within adequate spill containment so these materials are confined and easily cleaned up in the event of a spill. The lack of adequate spill containment is noted as a problem with the corrective action(s) and correction date specified on the last page of this report. In an effort to ensure the financial warranty remains adequate to reclaim this site per the requirements of the approved reclamation plan, DMG has updated the reclamation cost estimate (copy enclosed). Clearly, the site is currently under-bonded. Therefore, pursuant to Section 342.5-177(4) of the Colorado Land Reclamation Act for the Extraction of Construction Materials, adequate financial warranty must be submitted to DMG within 60 days of the mailing date of this report. Please review the enclosed figures as soon as possible and contact our office if any calculation errors are noted.