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(Page 2) <br />MINE ID # OR PROSPECTING ID #: M-1977-306 <br />INSPECTION DATE: 5/4/05 <br />INSPECTOR'S INITIALS GRM <br />This inspection was conducted as part of the continuing monitoring program established by the Colorado Division of <br />Minerals and Geology. The JD-6 and associated Mineral Joe Claims, JD-8, JD-9 and the Wright Group / SM-18 <br />Mines have begun mining operations after a lengthy period of minimal activity. The Division of Minerals and <br />Geology is inspecting the referenced sites in conjunction with permit reviews to ensure that permits meet current <br />standards for metal mining activities. Senior Environmental Protection Specialist Carl Mount, Environmental <br />Protection Specialist 11 Steve Shuey and Environmental Protection Specialist 11 Russ Means visited the above <br />referenced sites to familiarize Carl with the sites as the DMO review process continues. <br />The JD-9 MINE is the most complex of the mines noted above. The main entrance is in the Bull Canyon azea of <br />Monogram Mesa. The JD-9 has a shaft at the top of the mesa that is an emergency escape way as well as the point <br />where water from the under ground working is pumped for treatment and de-sedimentation prior to release down the <br />canyon. For clarity, this report will break down the observations into the shaft area and Mine Entrance area. <br />The Main Mine Entrance Area has a permanent building for equipment maintenance and supply storage. Several <br />loaders and mine equipment were noted in use or parked in this azea. During the inspection in Mazch there were no <br />secondary containment issues. On this inspection oil barrels were observed knocked over and oil stains were <br />observed on the ground next to the fuel tank storage structure. Also, major staining from oil was noted along the <br />south side of the shop area. The lack ofroroper secondary containment for barrels and sroillin¢ ofpetroleum products <br />is noted as a problem at the end of this report. (photos 3,4,7,8) <br />Waste from current activities is reported to be being gobbed or backfilled into old workings to reduce haulage <br />expenses and reduce surface impacts. New waste is noted being placed in the northwest corner ofthe dump azea or <br />old materials are being bladed up. Topsoil materials used to cover the 36" drainpipe aze now being covered by <br />waste materials as well as along edges of previously undisturbed ground. It appears that waste is now covering up <br />limited and valuable topsoil materials. The operator has a responsibility to salvage as much of these materials as <br />possible. The failure to rorotect topsoil type materials is listed as a problem at the end of this report. <br />Some ore has been brought to the surface for stockpiling. The operator stockpiles ore until there is enough for <br />several loads. At which point, the stockpile is removed and the process started over. Berms noted in Mazch are now <br />non-existent. Sediment from ore stockpiles can run freely down the entrance road and on into the drainage. <br />Road drainage ditches are noted as not being maintained and render silt fencing ineffective as well. Inadequate <br />sediment control is listed as a problem at the end of this report. (photos 5,6) <br />Discharge water from above now appears to be greater in volume. The discharge water is beginning to contact waste <br />materials along the eastern edge of the drainage and erosion along the western side. The operator must devise <br />control measures to ensure that the discharge water is affectively controlled to eliminate contact with the waste piles <br />and reduce erosion of opposite bank. Inadeauate control of discharge water is beine noted as a problem at the end of <br />this report. (photos 1,2) <br />The Emergencv Shaft /Water Treatment Area has a head frame and 2 small sheds on site. The sheds house the <br />pumps and water treatment tanks. The water from the tank goes into a preliminary settling pond and then down to a <br />secondarypond prior to release. The primarypond was noted as beginning close to being silted up. The liner above <br />the water line is also beginning to show signs of deterioration along the free board of the pond. The secondarypond <br />is in better shape. It should be noted that the operator has already built new ponds just to the west of the current <br />