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(Page 2) MINE ID # OR PROSPECTING ID # M-1994-108 INSPECTION DATE 8/28/07 INSPECTOR'S INITIALS RCO OBSERVATIONS This inspection was performed by the Division as part of its monitoring of Construction Materials 112c permits and in response to a written citizen complaint. The operator was contacted about the scheduled inspection, and the operator named on page one was present during the inspection. The required permit ID sign was posted at the entrance to the site and permit boundary markers (mainly existing fencelines were observed in place. The site was active on the day of the inspection, with excavation of native material, crushing and screening, washing and stockpiling, plus asphalt batching and hauling offsite. There was a wheeled loader moving material exclusively for reclamation also. Sky Ute Sand and Gravel is carrying out the excavation and processing. Kirkland is carrying out the asphalt batching. Asphalt batching is an approved activity (under technical revision TR-01, in 1997). These activities are occurring presently on an intensive schedule for two local paving contracts which must be completed during a limited window of time. The asphalt equipment is inspected by the Air Pollution Control Division of CDPHE, and is incompliance with the APEN permit. The mapped areas shown on the recent annual reports corresponds closely to the active areas observed. Mining is proceeding to the south, with the wash plant and ponds in the north, and crushing and batching in the central area. There is a scale on the southern end of the operation. All products, including natural and crusher fines and sediment cleaned from the ponds, find a use at the pit. If they are not sold, they are used in the backfill and growth medium for reclamation. The highwall is excavated vertically, and aggregate mined down to the underlying shale layer. Backfill material is placed above the irregular shale layerto level the floor for drainage and post-mining land use. The northern end of the highwall is being backfilled and sloped as excavation moves to the south, but no topsoil has been replaced yet, nor revegetation begun. The plan currently allows a specific amount of disturbance, and if activities have accelerated and more acreage is needed, the operator must submit another technical revision to allow such expansion. The bond will be recalculated after such revision is approved. As mining proceeds, and equipment and product stockpiles occupy more area on the pit floor, stripped topsoil must be stockpiled out of the way of future mining to avoid deterioration. Earlier in 2007, a new topsoil stockpile are has been established upon the unmined ground at the south end of the permit. This new soil surface can be vulnerable to erosion, and especially subject to wind erosion. The pile has begun to "crust over', lessening the likelihood of blowing soil, but the operator in All drainage reports to sediment ponds or berms along the pad. There is no surface discharge from the disturbed areas of the site. All hydrocarbon tanks are kept in impermeably-lined secondary containment structures. There is no evidence of stained soils or spills. The operator is in compliance. The site has a noxious weed control plan, which appears to be functioning adequately against the common noxious weeds, such as Canada thistle, musk thistle and Russian knapweed. However, the sediment/wash ponds, which have existed for many years there, are beginning to show a few tamarisk plants. Since this appears to be a fairly new invader, and since there is a weed control plan for this permit, there is no problem noted, but the operator must update the plan to include monitorino and treatment of this species too. Please contact the county or local weed control officer for the necessary information, and forward a copy of the updated plan to this office. All weed control activities should be reported in detail in the annual reports, as well as the mining and reclamation. This office will check your upcoming reports for description of these activities. No further items were observed during the inspection. Responses to this inspection report should be directed to the Division of Reclamation, Mining and Safety, 701 Camino del Rio, Room 325, Durango, Colorado 81301, Attn: Bob Oswald; phone no. 970- 247-5193. (Please note the new room number, and revise your records as necessary.) Cont.