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(Page 3) MINE ID # OR PROSPECTING ID # M-1990-070 INSPECTION DATE 4/8/04 INSPECTOR'S INITIALS WHE The following problems (PB) and/or possible violations (PV) (and suggested corrective actions) were identified during this inspection. The problems should be corrected by the dates given, or they will become possible violations. The possible violations should be corrected by the dates given to reduce their severity when considered by the Mined Land Reclamation Board. The inspector noted on the previous page should be notified of all corrective actions taken. PROBLEMS/POSSIBLE VIOLATIONS AND CORRECTIVE ACTIONS Mining activities do not appear to be occurring in accordance with the approved plan. Permit documents indicate that excavation activity would maintain a 3H:1 V and/or 4H:1 V slope but observations made during the inspection and recorded in this report indicate that excavation from the toe of slope has resulted in 1 H:1 V and steeper slopes. The chosen post-mining land use, rangeland, requires slopes no steeper than 3H:1 V. Therefore, the steep slopes created by the excavation activity may prohibit the operator from accomplishing the requirements of the approved reclamation plan. The operator has indicated that the 4H:1 V slopes described in the original permit application were in error. The operator's June 23, 2001 correspondence states that 1 H:4V (75 degree) slopes were intended. CORRECTIVE ACTION: Within 60 days of the signature date of this report, by June 21.2004, submit an Amendment to the pennit to correct the slope errors of the original permit application and revising the post-mining land use from rangeland to something compatible with steep slope conditions. Options for post-mining land use are identified in Rule 3.1.1. The Amendment to the permit shall be submitted in accordance with Rule 1.10 and shall contain a geotechnical stability exhibit, which satisfies the applicable requirements of Rule 6.5. The geotechnical stability exhibit shall specifically address potential for damage to County Road 25 resulting from mining activities. 2. Mining activities appear to have over-excavated the toe of slope resulting in steep and unstable slopes. Active slumping of slope material was observed during the time of the inspection. The slump scarp was visually estimated as being 200 feet above the toe of slope (pit floor). The slump scarp approaches County Road 25, located approximately 300 feet above the toe of slope. Existing maps in the permit lack sufficient detail to determine the exact location of the permit boundary, as necessary to verify that the slump scarp remains within the permit boundary and no off-site damage has occurred. CORRECTIVE ACTION: Within 30 days of the signature date of this report, by Mav 22, 2004, submit updated maps of the permit area, which satisfy the basic map requirements of Rules 6.2.1(2), 6.3.3, 6.3.4, and 6.3.5. The updated maps must show the current location of the slump scarp in relation to the permit boundary. The permit boundary must enclose all lands affected by the mining activity. CORRECTION DATE June 21.2004 PB or PV: PB TOPIC(S): MP RS,_, Mav 22, 2004 PB or PV: PB TOPIC(S): AR OD , BG , Enclosure: Photo taken during the inspection; Certificate of Service.