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(Page 3) <br />MINE ID # OR PROSPECTING ID #: M-1978-279 <br />INSPECTION DATE: 1-25-05 INSPECTOR'S INITIALS GRM <br />The bond was recalculated in March of 2003. Current conditions have not changed significantly to warrant a <br />recalculation. <br />No other problems or issues are noted at this time. <br />Responses to this inspection report should be directed to Russ Means at the Division of Minerals and Geology, Grand Junction <br />Field Office, 101 South 3rtl Street, Room 301, Grand Junction, Colorado 81501, phone no. 970-241-1117. <br />I & E Contact Address cc: <br />^ CE <br />NAME:. Fred Frei ^ BL <br />OPERATOR: Flag Resources ^ FS <br />STREET: 1412 Countv Road 311 ^ HW <br />CITY/STATE/ZIP: New Castle. Co 81642 ^ HMWMD (CH) <br />^ WOCD (CH) <br />^ OTHER <br />