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III. COMMENTS -COMPLIANCE Colowyo C-1981-019 26 April 2006 Pg 1/5 Below are comments on the inspection. The comments include discussion of observations made during the inspection. Comments also describe any enforcement actions taken during the inspection and the facts or evidence supporting the enforcement action. This was a partial inspection of the Colowyo Mine conducted by Jim Stark of CDMG. The inspection was conducted on 26 and 27 April 2006. Tony Tennyson of CCC accompanied me on the inspection on both 26 and 27 April 2006. Matt Guptill of CCC accompanied us on the morning of 27 April 2006. Tay Tonoai was present in on the afternoon of 26 April 2006 and the morning of 27 April 2006 to discuss ongoing and future permitting actions. The mine was actively mining coal and hauling coal to the loadout at the time of the inspection. The weather was warm and sunny and the ground was dry. On the afternoon of 26 April 2006 and the morning of 27 April 2006 we discussed the status of Technical Revisions 62, 63, 64 and 65, Minor Revision 81, the proposed South Taylor Permit Revision and Phased Bond Releases. CCC has adequacy letters from the Division for TR-62 and TR-63. The Division has requested that CCC extend both decision dates until 30 May 2006. The Division has called TR-64 incomplete, pending the receipt of a corrected public notice. The Division has also called TR-64 incomplete, pending the receipt of a corrected public notice. We also discussed the South Taylor project. CCC is continuing with permitting and is planning on submitting a Permit Revision to the Division by the beginning of July 2006. Their target is to have an approval and begin construction of ponds by May 2007. There is a meeting scheduled on 2 May 2006 regarding the South Taylor project (on situ. Kurtis Blunt of CCC hand delivered the first quarter 2006 DMR forms at the time of the inspection. Roads: -The access road and haul road to the Gossard Loadout is a paved road. The road was well maintained and in good condition. -The light-use road to the West Pit and East Taylor ponds was dry and slightly rutted at the time of the inspection. The road was still stable and overall in good condition. - The haul roads in the East and West pit areas were all well maintained and stable at the time of the inspection. The roads were dry and were being constantly watered at the time of the inspection. No erosional problems were noted on these roads. - The light-use roads around the Gossard Loadout and to the rail loop were all well maintained and in good condition. -The roads around the Section 16 Pit and pond (many of which are exploration roads) were all stable at the time of the inspection. The roads are not used very much as the Section 16 Pit is inactive. The Section 16 Pit will be used for a haul road for the South Taylor project. CCC will also be creating additional in-pit roads in the Section 16 Pit area for topsoil and overburden removal operations that are underway.