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MINE ID # OR PROSPECTING ID #: M-1988-052 INSPECTION DATE: 3/23/2006 (Page 2) OBSERVATIONS INSPECTOR'S INITIALS: CMR HHP This was a normal monitoring inspection of the Big R Pit conducted by Chris Rowe and Harry Posey of the Colorado Division of Minerals and Geology. Rick Hunt the Representative and Owner of the pit joined us at the end of the inspection. The pit is located 16 northwest of Kiowa, approximately a quarter mile east of Running Creek. The Big R Pit is located on something of a sandy knoll. It is a 110c permit with 9.9 acres permitted, and 9.9 acres potentially affected. The pit is just south of an office and equipment storage yard. The current disturbance area is approximately 3.2 acres. The phased Operation Plan indicates that no more then 3 acres will be disturbed before reclamation beginning. Mining is currently progressing to the south and west side of the pit. The pit is open to the northeast corner, with any stormwater runoff progressing offsite in that direction. The bottom of the pit is flat and currently contains a number of pieces of mobile equipment, many of which do not appear to be used in the mining operation. This includes a fuel semi-trailer and two other tanks. It is not known if fuel is stored in the trailer and tanks. Storage of oil and fuel products on the mine site requires surface and ground water protection efforts (C.R.S. 34-32.5-116(4)(h). If the tanks on the mine site contain stored fuels or other hazardous materials a Spill Prevention Control and Counter Measure plan (SPCC) may be required, along with a Technical Revision to the Operation Plan. Please notify this office if fuels are being stored on site, and if so will they be removed, or will the Operator be implementing the required spill prevention processes. There is a 20 to 30 foot high moderately steep highwall area along the active face and what appears to be a road above the high wall. There are two topsoil stockpiles, both appear to have been recently worked. Neither topsoil stockpile is properly vegetated or sloped in order to reduce wind and water erosion per the Mineral Rules and Regulations section 3.1.9. It is recommended that the stockpiles be stabilized through proper grading and revegetation as soon as practical. The current financial warranty is set at $5,100 and as long as the phased approach toward reclamation is followed this warranty is considered adequate. Enforcement and Inspection Contact Address NAME: Rick Hunt OPERATOR: Big R Construction Comoanv STREET: 88 Inverness Cir. E. Unit 8101 CITY/STATE/ZIP: Englewood. CO 80112 cc: U.S. Army Corps of Engineers U.S. Bureau of Land Management U.S. Forest Service CO Department of Transportation CO Hazardous Materials and Waste Division CO State Engineers Office CO Water Quality Control Division OTHER: