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COLORADO DEPARTMENT OF PUBLIC HEALTH AND ENVII20NMENT <br />DIVISION OF ADMINISTRATION <br />WATER QUALITY CONTROL DIVISION <br />NOTICE OF VIOLATION !CEASE AND DESIST ORDER NUMBER: IO-040423-1 <br />IN THE MATTER OF: GOLD IffNG MINES CORPORATION <br />CDPS PERMIT NO. CO-0027529 <br />SAN JUAN COUNTY, COLORADO <br />Pursuant to the authority vested in the Colorado Department of Public Health and Environment's (the <br />"Department") Division of Adtninishation by §§25-1-109 and 25-8-302, C.R.S., which authority has been <br />delegated to the Director of the Department's Water Quality Control Division (the "Division"), and pursuant <br />to §§25-8-602 and 25-8-605 C.R:S., the Division herebymakes the following Findings ofFact and issues the <br />following Notice of Violation /Cease and Desist Order: <br />FINDINGS OF FACT <br />At all times relevant to the alleged violations identified herein, the Gold King.Mines Corporation <br />("Gold. King") was a Colorado corporation in good standing and registered to conduct business in the <br />State of Colorado. <br />2. Gold King is a "person" as defined under the Water Quality Control Act, §25-8-103(13), C.R.S. and its <br />implementing pewit regulation, 5 CCR 1002-61, §61.2(73). <br />Gold King owns and/or operates the American Tunnel wastewater treatment facility (the "Facilit}~'), <br />located in the Northeast I/< of Section 21, Township 42 North, Range 7 West (Latitude 37°.53' 29" <br />North, Longitude 107° 38' 46" West), near the town of Silverton, San Juan County, Colorado. The <br />Facility treats mine related wastewater through a series of four unlined ponds utilizing pH adjustment <br />and flocculation settling treatment processes. <br />4. The Facility is the subject of the Colorado Discharge Pernt System, Permit No. CO-0027529 (the <br />"Permit"). The current Permit became effective on July 1, 2001 and is due to expire May 31, 2006. <br />On December 30, 2002 Sunnyside Gold Corporation ("Sunnyside") and Gold King submitted an <br />"Application for Transfer of Ownership" to the Division, requesting the transfer of the Pernt from <br />Sunnyside to Gold King. The application was approved by the Division, and effective January 13, <br />2003, Gold King accepted the responsibilities, coverages, and liabilities of the Permit. <br />Gold King Mines Corporation <br />Notice of Violation/Cease and Desist Order <br />Page 1 of I ] <br />