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(Page 2) <br />MINE ID # OR PROSPECTING ID # M-1983-030 <br />INSPECTION DATE 2/12/04 <br />INSPECTOR'S INITIALS WHE <br />OBSERVATIONS <br />This inspection of the Twin Canyon Mine occurred in accordance with DMG's routine monitoring policy <br />for permitted operations. Mr. Westley Potts accompanied the DMG inspectors throughout the inspection. <br />The Twin Canyon Mine is approved for 0.75 acres affected area, for the extraction of precious metal ore <br />from the historic Charlene Tunnel, and processing of the ore at a mill site located behind the residence of <br />Mr. Potts. Permit status is active. DMG holds $1,500 financial warranty. <br />The operator indicated that recent mining activities at the Charlene Tunnel were limited to site <br />maintenance. This inspection was limited to activities conducted at the mill site and did not include <br />activities conducted at the Charlene Tunnel. <br />Snow cover, approximately 6-inch depth, covered the 0.27 acre mill site. Mine identification sign was <br />posted. Milling equipment appeared to have been dormant for an extended period of time but intact. <br />Milling equipment included an electrical panel, ore bin, jaw crusher, ball mill, vibrating table, and <br />sediment pond. Quantity of stockpiled ore and tailings sand appeared minimal. <br />Financial Warranty: Pursuant to Section 34-32-110(1)(d) C.R.S., the maximum financial warranty for <br />110(1) type operations is $1,500. Therefore, the existing $1,500 financial warranty is sufficient under the <br />Act and Rules. <br />Site appeared stable. No problems or possible violations were observed. <br />Responses to this inspection report should be directed to the Division of Minerals and Geology, 701 <br />Camino del Rio, Room 125, Durango, Colorado 81301, Attn: Wally Erickson, phone no. 970-247-5469. <br />I & E Contact Address <br />NAME Westlev Potts <br />OPERATOR Potco Milling & Mining <br />STREET 8115 County Road 41 <br />CITY/STATE/ZIP Mancos, CO 81328 <br />cc: Harry Posey, DMG <br />^ CE <br />^ BL <br />^ FS <br />^ HW <br />^ HMWMD (CH) <br />^ SE <br />^ WOCD (CH) <br />^ OTHER <br />