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~ ~ Cheryl Signs, P.E. Page 2 Durham Pit, M-1978-056 May 24, 2004 The proposed source of replacement for this pit is 98.1 acre-feet of historic stream delivery from the dry-up of 33.7 acres of land historically irrigated with five shares of Greeley lrrigation Company's interests in Greeley Canal No. 3 and Fossil Creek Reservoir diverted from the Cache la Poudre River and previously used for irrigation of the mined property. The values for the historical use credits of the five shares of Greeley Canal No. 3 and Fossil Creek Reservoir were prorated from the historical use analysis values decreed for the Greeley Irrigation Company in Case No. 96CW658. Based on the 2002 mining production and the proposed expansion of use of the mining area, there will be a total demand of 245.08 acre-feet per year if dewatering ceased. This includes the return flow obligations of 2 acre-feet per year from Fossil Creek Reservoir and 44.6 acre-feet per year from the Greeley Canal No. 3. Applying the 98.1 acre-feet of historical irrigation credits during the irrigation season, there will be 146.98 acre-feet of uncompensated depletions if dewatering on the site ceased. Replacement for depletions during the non-irrigation season and during months with insufficient credits will be made by releases of irrigation season credits (265.5 acre-feet) from four shares in the Rural Ditch Company. The four Rural Ditch Company shares were historically used to irrigate 158.9 acres on the 112-parcel site. Varra is proposing a storage program in a lined pit using the Rural Ditch irrigation season credits. An application for a storage water right in the 112-lined pond was filed with the Water Court in Case No. 2001CW274. An application for a change of water right (to allow the applicant's Rural Ditch shares to be used in addition to irrigation for augmentation, replacement, exchange, commercial, industrial, recreational, piscatorial, wildlife propagation and storage) and approval of a plan for augmentation was filed with the Water Court in Case No. 2003CW306. The return flow obligation of the Rural Ditch shares (101.51 acre-feet) will be met by a portion of the Hayseed Ditch controlled by the applicant. The historical use analysis of the Hayseed Ditch was presented in the proposed decree in Case No. 90CW174. The consumptive use credit used in this plan is based on the information provided in case no. 90CW174. If the Hayseed Ditch credits are not sufficient, releases from the 112-lines pond will be made to meet the required return flow obligations. In addition, releases from the 112-lined pond will be made to meet Varra's other obligations to the stream system. These obligations are in the net evaporation from the Del Camino facility (M-74-052), the non-irrigation season from the Kurtz Ranch Resource Recovery (M-99-006), and Hayseed Ditch non-irrigation season return flow obligations (7.4 acre-feet). The monthly depletions and replacement requirements are found on the attached Table II. As required by Section 8 of Senate Bill 89-120, this substitute water supply plan has been provided to an outside consultant for review. The consultant has recommended approval of the plan byway of a draft of this letter. Based upon statutory requirements and the recommendations of the consultant, I hereby approve the proposed substitute water supply plan in accordance with Section §37-90-137(11), C.R.S., subject to the following conditions: Unless otherwise revoked or modified, this plan shall be valid through December 31, 2005. If this plan will not be made absolute by a water court action by the plan's expiration date, a renewal request must be submitted to this office with the statutory fee (currently $217) no later than November 16, 2005.