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(Page 2) MINE ID w OR PROSPECTING ID N M-1977.378 INSPECTION DATE 1 iP4! INSPECTOR'S INITIALS WHE OBSERVATIONS This inspection occurred in response to the operator's request for release of 76.31 acres and S750.000 reduction in financial warranty (AR-02). The areas for release under AR-02 include approximately 2.5 acres area immediately northeast of the Mayflower Mill buildings and approximately 73.81 acres for Tailings Pond 1, 2 and 3. The Sunnyside permit is approved for 236.21 acres affected area. DMG holds 51,250.000 linancial warranty. Affected lands will be reclaimed to support a combination of wildlife habitat and rangeland post-mining land use. This inspection concentrated on the lands addressed under AR-02 and did not focus on other permitted lands not addressed under AR-02. The areas addressed under AR-02 appeared consistent with the descriptions provided by the permit holder in the release request. This report is accompanied by 7 photos taken during the inspection. Backlilling & Greding Tailings had been removed from drainage channels. Drainage channels had been riprap lined as necessary to control erosion. The tops of the tailings ponds had been graded for positive drainage. Upland diversions for surface and groundwater had been installed for the tailings ponds, to divert upland waters around the tailings and minimize tailings contact with water. All surfaces of the graded tailings ponds had been capped with earthen materials. Affected lands had been backlilled and graded to stable slopes, not steeper than 2.5H: t V. Backlilled and graded areas appeared stable, no evidence of settling, slumping or significant erosion was observed. Observations made during the inspection and recorded in this report indicate that the operator has completed backfitling and grading for all 76.31 acres addressed under AR•02 in accordance with the approved reclamation plan and the Act and Rules. Revegetation Vegetative cover was well established, diverse, and appeared at least equal in extent of cover to surrounding undisturbed lands. Revegetation efforts, completed over a decade ago, included distribution of available topsoil, application of the approved seed mix, application of fertilizer, and transplanting numerous shrub and tree species. W illow clumps appeared to have been transplanted in riparian areas. Aspen, spruce, fir and pine trees appeared to have been transplanted to upland areas. Subsequent to the original planting, the operator has reseeded isolated areas, amended the topsoil with composted manure, and employed weed control efforts as necessary. Transplanted trees and shrubs appeared to have enjoyed a high survival rate. Various species of grasses, lorbs and legumes were observed. The region has suffered drought conditions over the past several years. Fortunately, vegetative cover for affected lands was well established prior to the drought. During this inspection vegetative cover appeared more than adequate to stabilize affected lands and satisfy revegetation requirements of the approved reclamation plan and Act and Rules. Stall Recommendation Observation made during the inspection and recorded in this report indicate that the operator has completed reclamation for the entire 76.31 acres addressed under AR-02 in accordance with the approved reclamation plan and Act and Rules. On November 24, 2003. DMG approved AR-02. Financial Warranty DMG has reviewed the cost of reclamation and has determined that the 5500.000 financial warranty, requested under AR•02, is sufficient to ensure reclamation. Therefore. DMG approves the operator's request for S750.000 reduction from the existing St,250,000 financial warranty. I & E Contact Address cc: Harry Posey. DMG CE NAME Larry Perino „~ BL OPERATOR Sunnvside Gold C.OfDOfallOn ~ FS STREET P.O. Box 777 ;~ HW CITYiSTATElZIP Silverton. C0 81433 ^ HMWMD (CH) C SE C WOCD (CH) r OTHER