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(Page 21 <br />MINE ID # OR PROSPECTING ID # M-86-165 <br />INSPECTION DATE 11/23/98 INS ECTOR'S INITIALS WHE <br />OBSERVATIONS <br />This inspection occurred as part of DMG routine monitoring plan for permitte operations. John <br />Dillon accompanied the DMG inspector throughout the inspection. The illow Bend Pit is <br />approved for 6 acres affected area, for the excavation of alluvial materials from the Animas River. <br />Material stockpile and truck loading area exists along the west bank of the Anlmas River channel. <br />Operations were dormant during the time of this inspection. DMG holds 52,500financial warranty. <br />The Willow Bend Pit is accessed from Highway 550, via approximately 1,500'I of gravel surfaced <br />private road. Permit documentation indicates that although the access road is ncluded within the <br />6 acre permit area, the road pre-existed the mining permit. Access road was well maintained. <br />Livestock grazing was observed in the areas surrounding the permit area. Im ediately south and <br />west of the permit area, approximately 5 acres were being utilized to stockpil and process logs <br />for log home construction. ~ <br />Mining equipment was not observed at the mine site. Sand bar excavation are had been recently <br />worked with equipment, sediment containment berms had been construct d. Mining related <br />activities appeared to be contained within approved areas. Evidence of hannel instability, <br />resulting from mining activities, was not observed. <br />Records - DMG records indicate that the operator has submitted the an~ual fee for 1998. <br />However, the annual report form was returned to DMG without being com leted. Please find <br />enclosed, copy of the blank annual report form, as received by DMG. Sub ittal of an annual <br />report is required by Rule 1.15. Please complete the enclosed annual report for~and return to the <br />DMG Durango Office, 484 Turner Drive, Building F, Suite 101, Durango, CO 81 01, by December <br />31, 1998. <br />COE Permit - During December 1996, the US Army Corps of Engineers Issued Permit No. <br />199475349 to Sandco, for the Willow Bend Pit, under the authority of Section 04 and 401 of the <br />Clean Water Act. i <br />Financial Warranty - DMG has reviewed the cost of reclamation for the Willo``TT'' Bend Pit and has <br />determined that the current financial warranty, in the amount of 52,500, is siufficient to ensure <br />reclamation. II <br />I & E Contact Address <br />NAME John Dillon <br />OPERATOR Sandco. Inc. <br />STREET P.O. Box 4440 <br />CITY/STATE/ZIP Durango. CO 81302 <br />cc: Tom Gillis, DMG <br />x COE, Nick Mezei <br />^ BL <br />^ FS <br />^ HW <br />^ HMWMD ICHI <br />^ SE <br />^ WOCD ICHI <br />^ Other <br />