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(Page 2) MINE ID# OR PROSPECTING ID# M-1981-088 INSPECTION DATE 04/12/04 INSPECTOR'S INITIALS GRS This was a Pre-operational inspection in response to an Amendment application for the McCoy Pit, conducted by Gregg Squire of the Division of Minerals and Geology. John Rozelle and Rod Johnson of Lafarge West, Inc., were also present. The pit is located about 4 miles north of McCoy, Colorado. It was noted during the Divisions inspection report of June 10, 2003 that the reclamation plan at that time assumed that the cinder deposit would be completely mined out leaving a final grade that would be approximately flat. During that inspection it was noted that based on the large quantity of overburden waste rock and fines the reclamation plan for a flat surface could not be achieved. Therefore, the Division asked the operator to submit a revised mining and reclamation plan to address the excessive waste rock and fines generated from the site. Specifically, the operator would need to quantify the amount of waste rock and fines generated during the life of the operation, how the material will be stored and reclaimed to achieve the approved post-mining land use of rangeland, and further describe the nature and location of topsoil material to be used for reclamation. The operator submitted the requested Amendment and on February 9, 2004 the Division found the Amendment #2 Application adequate for review. At the time of the current inspection the site was actively being mined. A general inspection of the area was conducted, including the active pit, overburden and fines piles, product stockpiles, processing area and permit boundaries. The proposed amended reclamation plan was also reviewed, including the proposed availability of seed bed material and a description of how 3H:1V elopes would be achieved on the slopes. It was noted that the problem noted in the June 10, 2003 inspection report, concerning a lack of permit boundary markers, had been resolved. The boundary markers are now in place. In response to a question about the rail loop, it was stated that the majority of the loop is still in place, including the connection to the Union Pacific track on the south side of the pit, but that some of it had been buried to make it easier to cross over the loop with mining equipment. It was also noted that the operator has included a bond to remove the rail loop. If the State Land Board decides at a later date that it wants the loop to remain in place, that portion of the bond could be removed. A Permit ID sign was posted at the site and as noted earlier the permit boundary markers have been posted. No problems were noted during the inspection. I & S Contact Address NAME Mr. John Rozelle OPERATOR Lafarge West,Inc. r CE STREET 1400 W. 64C° Avenue r BL CITY/STATE/ZIP Denver, CO 80221 r HW r FS r HMWMD (CH) r SE r WQCD (CH) Cc: Mark Davis, State Land Board Carl Mount; DMG Via a-mail