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(Page 2) <br />MINE ID # OR PROSPECTING ID # M-1938-031 <br />INSPECTION DATE 7/19/06 <br />INSPECTOR'S INITIALS ESC <br />This was an inspection of the Phil Sheridan Lode conducted by Erica Crosby of the Division <br />of Minerals and Geology. The Division was unable to establish contact with the operator <br />using the phone numbers listed in the permit and annual reports. However, Harry Covey <br />(the land owner) and Ben Jordan were present during the inspection. <br />The site was identified with the mine name and permit number, and the fence line <br />delineated the permit boundary area. Explosive storage units were labeled and securely <br />locked. The portal and shaft areas were temporary sealed. No water discharge was noted <br />from the portal area or the small draw adjacent to the portal location. A few structures <br />remain on site consisting of the hoist house, ateelhead frame, and an office area. <br />Harry Covey expressed concern that Rocky Conner no longer has legal right to enter the <br />property to conduct mining or reclamation operations. A review of the file notes that the <br />Division had previously requested that the operator provide documentation of Comstock•s <br />legal right to enter and mine the permitted area. The Office of the Attorney General sent <br />Rocky Connor a letter on March 15, 2000 requesting that the information be provided by <br />March 31, 2000. However, no such documentation was supplied by the operator. See <br />attached letter for further detail. The operator will need to provide documentation of <br />Comstock•s legal right to enter the permitted area, including any agreement reached with <br />the landowners by September 1, 2006. Failure to do so will result in a notice of possible <br />violation of Rule 6.3,7 for failure to provide a description of the basis for legal right <br />of entry to the site to conduct mining and reclamation. See page 3 for further detail. <br />The Division accessed the Secretary of State's Office database to determine if Comstock <br />Mining and Refining is a legal entity to do business in the State of Colorado. A search <br />of the Colorado Secretary of State's corporate database revealed that Comstock Mining and <br />Refining is not listed as being authorized to conduct business in Colorado. Failure to be <br />registered with the Secretary of State's Office is a possible violation of C.R.S. 34-32- <br />118(1)(d) and Rule 4.19(1)(d) for failure to carry out their obligation under the article. <br />The operator will need to provide documentation that they are registered to do business in <br />the State of Colorado by September 1, 2006. See page 3 for further detail. <br />The Division holds a bond in the amount of $1,718.41. This amount does not appear to be <br />adequate to reclaim the site according to the reclamation plan. The Division will <br />reevaluate the amount of bond and inform the operator of any increase under separate <br />cover. <br />2 & 8 Contact Address <br />NAME Mr. Raymond (Rocky) Conner ~ <br />OPERATOR Comstock Mining ~ Refining ~ <br />STREET P.O. Box 841 <br />CITY/STATE/ZIP Silver Springs, NV 89429 <br /> <br />CE <br />BL <br />FS <br />HW <br />HMWMD (CH) <br />SE <br />WQCD (CH) <br />Cc: Carl Mount; DMG <br />Harry Covey <br />