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(Page 2} MINE ID # OR PROSPECTING ID # M-2001-001 INSPECTION DATE 10/27/03 INSPECTOR'S INITIALS WHE This inspection occurred to evaluate current conditions. The Line Camp Pit is located approximately 9 miles northeast from Dolores, at 21944 Hwy 145, in portions of the SW Ys of the SE ~/a of Section 22, T33N, R22W, NMPM, Montezuma County. The operation is approved for 22.6 acres affected area. Affected lands will be reclaimed to support developed water resources and pastureland post-mining land use. DMG holds $92,000 financial warranty. Permit status is active. Mine identification sign was posted at the entrance to the permit area. Public access to the permit area is controlled with fence and locked gate. Permit boundaries were adequately delineated. Mining and reclamation activities were confined to permitted areas. Construction of the mine access road appeared to have been completed. Mining activities had commenced in the southem end of the permit area, as described in the approved mine plan. Approximately 60%of the permit area had been affected by mining activities and/or construction of the access road. The operator had not commenced dewatering of the pit; water was observed within the southern portions of the pit. Elevation of the exposed groundwater was approximately6 feet below the elevation of the original ground surface. Material stockpiles bordered the active pit area on the west, south and east sides of the pit. The material stockpiles did not form a continuous embankment around the pit. Two gaps in the material stockpiles were located at the southeast comer of the permit area. The gaps were approximately 20 feet wide at the base. Native vegetation and soils, indicating the original ground surface, were evident across the base of the gaps. Evidence of the operator employing weed control methods, both chemical and mechanical, was observed throughout the permit area. Topsoil stockpiles S3, S4 and SS were located as shown on the mine plan maps. The topsoil stockpiles appeared stable, no evidence of significant erosion was observed, however, vegetative cover for the stockpiled topsoil was sparse. Pursuant to Rule 3.1.9(1) and permit conditions, the operator must establish an appropriate vegetative cover to protect and stabilize the stockpiled topsoil. Previous efforts to establish a vegetative cover for the stockpiled topsoil included hydro seeding in August 2001 and broadcast seeding in September 2003. Due to the continuous efforts towards revegetation, the current sparse cover does not constitute a problem at this time. Drought conditions have adversely affected revegetation efforts. However, the operator must establish an appropriate vegetative cover or revise the permit to address stabilization of stockpiled topsoil with alternate methods. DMG will re-evaluate the vegetative cover for the stockpiled topsoil in July 2004. On April 18, 2001, DMG calculated the cost of reclamation at $91,917. The current disturbance appeared to be significantly less than the disturbance anticipated for April 2001 reclamation cost estimation. Therefore, the existing $92,000 financial warranty is sufficient to ensure completion of reclamation. No problems or possible violations were observed. Three photos accompany this report. Responses to this inspection report should be directed to the Division of Minerals and Geology, 701 Camino del Rio, Room 125, Durango, Colorado 81301, Attn: Wally Erickson, phone no. 970-247-5469. I & E Contact Address NAME Arvol Brumley OPERATOR Four States Aggreoates. LLC STREET P.O. Box 1568 CITY/STATE2IP Cortez,C081321-1568 cc: Harry Posey, DMG ^ CE ^ BL ^ FS ^ HW ^ HMWMD (CH) ^ SE ^ WOCD (CH)