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(Page 21 MINE ID # OR PROSPECTING ID #: M-1988-021 INSPECTION DATE: 6/25/03 INSPECTOR'S INITIALS JCS OBSERVATIONS This inspection was conducted in order to secure data sufficient to allow the recalculation of the financial warranty following a request for transfer of the permit by the operator, Soward Ranch Partnership. The operator waived the right to a 30-day processing time for the request which was received by the Division on May 29, 2003. Mr. Scott Lamb was present at the beginning of the inspection and at the conclusion, but not during the course of the data gathering. An acceptable ID sign was posted for the operation. Markers for the four corners of the roughly rectangular permit area were identified.The pit was inactive at the time of the inspection. There was a small front end loader on site and a refueling station. The disturbance consists of two principal parts, an excavated pit and a storage and processing area. The storage area has a compacted gravel surface and currently contains several stockpiles of material. Topsoil has been stockpiled primarily in the southeast portion of the permit area. In apparent anticipation of expansion of the pit, a portion of the northwest permit area has been grubbed and stripped. The approved post mining land use is pastureland. The approved reclamation plan requires the side slopes of the pit be reduced to slopes of 3H to 1 V or flatter.Topsoil is to be spread to a depth of 6 inches and the area reseeded with the approved seed mix. Seeding is to be accompanied by fertilization and mulching. The results of the recalculation of the financial warranty are enclosed.The enclosure consists of seven sheets, i.e. a Cost Summary Form and six additional forms which represent calculations of the costs of the six reclamation tasks that are considered necessary to complete the approved reclamation plan. The Division is required to use a third party for any reclamation that the Division may be required to conduct. Consequently, in addition to basic reclamation costs, indirect costs for insurance, bonding, and operator profit as well as division administrative costs must be included in the overall estimate. The total cost of reclaiming current disturbance at the site is estimated at 59035.00 Section 117(4)(bl(I) of 34-32.5-101 et. seq., CRS as amended, requires the financial warranty for an operation be sufficient to assure completion of reclamation. Since the current estimate of the reclamation cost exceeds the amount of presently posted financial warranty, i.e. $8,335.00, this inspection report is also to serve as the Division's notice under Section 1 17(4)(c)(II) of the Act that the operator has 60 days from the date of this notice/inspection report to provide the additional bonding. This may be done by furnishing a replacement financial warranty of 59,035.00 or by means of additional bonding in the amount of 5700.00. Please contact Ms. Suzi Ericksen in the Division's Denver Office @ 303-866-3567 for guidance in providing a replacement or additional financial warranty.