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III. COMMENTS - COMPLIANCE <br />Below are comments on the inspection. The comments include discussion of observations made <br />during the inspection. Comments also describe any enforcement actions taken during the <br />inspection and the facts or evidence supporting the enforcement action. <br />This was a complete inspection conducted by Kent Gorham of the Colorado Division of <br />Minerals and Geology. Ron Thompson represented Basin Resources during the inspection. <br />This former underground mine is now reclaimed. Activities consist mainly of monitoring <br />and maintenance. The weather was cool and patchy snow covered the ground. <br />Availability of Records <br />The public copy of the mine records is kept at the Tri-State Railyard office located on <br />the west side of Trinidad on Highway 12. All required records were easily located with <br />one exception. The insurance certificate showed an expired date of September 1, 2000. <br />Division records indicate coverage from Great Northern Insurance Company in the amount <br />of $2 million in effect till March 1, 2001. The operator will place a copy of this <br />certificate with the public copy of the mine records immediately. Details of the record <br />inspection are noted on the attached record checklist. <br />Revegetation <br />Reclaimed areas show no sign of significant erosion. Hydrologic cover is good to <br />excellent in most reclaimed areas. Interseeding and mulching has been completed in the <br />areas roto-tilled previously (see inspection of October 9). Efforts 'to revegetate the <br />upper Apache fan cut slope appear marginally successful at this time. <br />Soil Methane Monitoring <br />The two gas wells on the Toupal property east of the reclaimed area have been regraded <br />and reseeded. Regraded areas blend in well to the surrounding pasture. Additional <br />monitoring for soil methane will continue to the extent necessary to determine whether <br />gas well abandonment has had any affect on the methane levels in the soil. <br />Overall, the site is in good condition going into the winter season. <br />Page 3 <br />