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Page 2 of 2 MINE ID M-1981-112 INSPECTION DATE: 10/20/2006 INSPECTOR'S INITIALS; CMR OBSERVATIONS This inspection was in response to a mine conversion permit application submitted by the Builders Aggregate Company, Inc. The permit conversion application is to establish a 80-acre sand and gravel surface mine just north of Fort Morgan. This pre-operational inspection was conducted pursuant to Section 3.2.7 of the Mineral Rules and Regulations. Chris Rowe of the Division of Mining, Reclamation and Safety (Division) carried out the inspection. Jim Miner was present from Builders Aggregate Company, Inc. (Operator). This is a complex mine site that has been active for approximately 50 years. It is not always clear what land disturbing activities happened pre Mined Land Reclamation Act, which ones are related to other commercial operations at the site, and which are related to permitted mining activities. The boundaries for the 9.0 acre mine site are not marked, and do not appear to have ever been marked (Rule 2.1.12(2)). No boundary markers are a problem that will need to be corrected (see next section). Also the boundaries of the proposed 80 acre mine site were not marked; this is a problem that will need to be corrected (see next section). The site is accessed from the southwast by a road that runs across Western Sugar property. To the east is Hwy 52 and associated bridges over the South Platte. Boyd Ponds State Wildlife Area is west of the mine site. The general mine site includes an approximate 2 acre pond, two suction dredges, a couple of pipelines leading to two screener's, some conveyor belts, stockpiles, and a small concrete batch plant. All of these facilities cover about 7 or 8 acres. The equipment is located on land that is a reclaimed dredged area. The primary feature of the 80 acre site is the South Platte River. The River runs from northwest to southeast through the property. The river channel is braided and meandering through the site. According to the Operator the River has left its main channel and flooded the dredge pond at least once. Recent mining does not appear to have been any closer then 200 feet from the River. It looks like that when the River leaves its banks it flows through a low area on the northeast comer of the site, through some wetlands, into the dredge pond and out a trench to the river. The low area looks like it had a five plus foot bank at one point, but that it was taken out by a previous flood. Now the water level would only need to come up a couple of feet to cause inundation of the mine area. The wetlands appear to be in a formerly mined area that has silted in. The approximate 2 acre pond moves as the site is dredged. The trench runs approximately 200 feet from the pond to the River. Because the trench continuously takes groundwater from the mine area to the River, the Division believes that this constitutes a point source discharge to the River. It seems that when mining is occurring sediment would be carried from the pond through the trench and to the River (Rule 3.1.6(1)(b)). This is a problem that requires correction (see next section for corrective actions). Please see the attached undated aerial photo; it appears to have been taken when the River was flowing through the mine area. The Operator has been mining sand in a dry meander channel on the north side of the River. Because there has never been documented mine boundaries at this site, this is not considered mining outside the mine boundaries (Rule 3.3(2)). Once the 110c mine boundaries have been established, and if this area is outside those boundaries, then no further mining should occur there. The upland area on the south end of the property is mostly reclaimed mine lands. This site is used as an industrial area by the Operator. There is at least one large concrete rubble pile. While there has been extensive use of concrete blocks to riprap the River banks, it does not appear that the concrete has been backfilled at the site. If the Operator wishes to backfill with concrete or other imported inert material a certification will need to be provided to the Division per Rule 3.1.5(9). If the Operator wishes to continue to add additional riprap material to the River banks, the Army Corps of Engineers should be contacted about obtaining a permit to carry out flood control work (Rule 3.1.6(1)(c)). The northeast corner of the proposed mine site has the Operator's business office, two warehouse type building, extensive construction equipment, and an equipment bone yard. There is also a series of dirt and concrete piles that according to the operator are used to deflect River floods from the buildings.