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Mr. Gregg Squire • Page 3 January 2, 2001 [tem 4 -Erosion mitigation, bank/pit slope stability. See Item 3 above. Item 5 -Watershed protection A Watershed Protection Permit application has been submitted to the City of Rifle. A response is being prepared by Balaz & Associates, Inc. Item 6- Avian nesting sites. The operator intends on mining the renewable resource area on an intermittent basis and only during low flow periods in the Colorado River. The low flow period is generally expected to be between October 1 and March 31. However, the low flow period will vary depending on snow pack and weather conditions in the drainage basin. As such the renewable resource area operating schedule may vary from that mentioned above if the water level in the Colorado River is low enough to allow safe mining in the renewable resource area before or after the above mentioned dates. After the initial mining of the renewable resource area, the frequency of mining will be determined by the rate of recharge and is expected to be variable ranging from as frequently as annually to as low as once every five years. The mining of the renewable resource area in the fall and winter of the year is expected to have minimal impact on the heron rookery as the nesting usually takes place in the spring and summer. Mr. Brian Gray, DOW, was contacted by phone concerning the concerns raised in his letter dated November 5, 2000. During our phone conversation, the mining of the renewable resource area during the low flow period was discussed. Mr. Gray felt that the heron usage of the rookery area would be minimal or non existent as the herons migrate from this area in September and October. Item 7 - 100 year floodway. The 100 year floodway did not appear to be defined in the 1982 floodplain study performed by the Army Corps of Engineers for the Colorado Water Conservation Board and Garfield and Mesa Counties. As mentioned in Item 2 above, BAI is modeling a portion of the Colorado River to assess the impacts of the pits on the 100 year flood and vice versa. The base flood cross sections will be modified in alternate scenarios for various phases of activities. Alternative cases include mining in one pit and the balance of the area is undisturbed, mining in a second pit and the first pit is partially filled with water, mining in a third pit with the second pit partially filled with water and the first pit filled with water, and all three pits filled with water. The cross section geometry will include in pit stockpiles and equipment. This analysis will be forwarded when it is completed. Item 8 -Bonding for downstream off-site impacts. The operator has submitted a reclamation bond estimate for the on site impacts as required by Statute. The operator is not aware of any requirements to bond for off site impacts.