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III IIIIIIIIIIIII III r~~~ 999 COAL FUELS CORPORATION LOS LAGOS RANCH, P.O. BO\ IJO ROLLINSVILL E, COLORADO BOa73 PHONE: 703-629-OJJI December 15, 1989 Mr. J. A. Crichton Chairman and Chief Executive Officer American Shield Coal Company 10830 North Central Expressway, Suite 175 Dallas, Texas 75231 Re: Anchor Tresner Coal Unit Dear Mr. Crichton: [t15R ~° ~~a~~® DEC 181989 MINED LANV RECLAMATIQN DI'JlglOhf One of our points of disagreement is the failure of American Shield Coal Company and Arabian Shield Development Corporat>_on to permit the Anchor Tresner Coal Unit and to "conduct a modern, efficient coal mining operation on the Anchor Tresner Unit and to obtain all permits and approvals necessary to comply with federal, state and county statutes and regulations." (Paragraph 9-C, D, & F, December 31, 1976 Agreement as amended). A reclamation permit that does not permit production of coal from the unit does not fit the permitting and production clauses of the agreement. We must oppose the reclamation permit you are seeking from the Colorado Mined Land Reclamation Division as you will be spending some $50,000 to cover up and alter what little development of the unit presently remains. We then will have to spend in excess of the $50,000 to restore the presently existing development. A possible solution to this dilemma would be for American Shield Coal Company to assign the reclamation permit, when and if it is granted, to Alfred G. Hoyl together with the $50,000 cash bond or whatever sum is decided upon. This would require obtaining approval of the arrangement by the Colorado Mined Land Reclamation Division and their granting Alfred G. Hoyl adequate time in which to amend the permit and to get the unit into development production, a minimum of eighteen months. Certainly going forward instead of backward is to everyone's advantage. If the above is arranged, we would concur in the return to your group by the Mined Land Reclamation Division of the balance of $91,000 from the $141,000 which we understand the division holds.