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Pond Information September 23, 1999 Page 2 of 3 Pages By February 18, 1999 [as noted in a Colorado Division of Minerals and Geology (Division) an inspection report of that date], the Pond was in an automatic dewatering mode versus the gate operation of previous times. As of the March 8 and 9, 1999 Division inspection, a treatment cell had been constructed above East Taylor Creek Pond for pit water from the West Pit, but no discharges had been made into the Pond. There is no additional information concerning the Pond in this March inspection report. An extract of the Division inspection report for April 21, 1999 with regard to the Pond follows: "East Taylor Pond was not discharging, but the water level was up over the weep holes. Residue on the outlet downchute of the primary spillway indicated a muddy dischazge. The pond needs maintenance to restore the design storage capacity. The sediment in the pond appears to be a gray, fluffy material. The source of this sediment appears to be from runoff from the West Pit Haul Road. Pictures were taken. At the time of the inspection, a small flow (est 1 gallon/minute) was flowing down the haul road ditch, past the treatment cell flocculation building, and over the embankment to East Taylor pond. This surface drainage was very muddy -the sediment of very fine material" At the time of the May 5/6, 1999 Division inspection, cleaning of the Pond had not been accomplished. An extract of the May 5/6, 1999 inspection report, with regard to the Pond is: "There was a trickle discharge from the East Taylor Pond on May 5. Water was cleaz." "The trickle discharge from the East Taylor Pond was overflow of the crest of the primary riser. The weep hole is still plugged, The sediment level is high. Since the last inspection, Colowyo has sent out a request for proposals to dredge this and other ponds. The solicitation was dated April 30, 1999, Re: Request for Proposal -Sediment Pond Dredging. A pre-bid conference is scheduled for May 10, 1999 and proposals are due May 14. Flocculation of sediment in East Taylor Pond has been accomplished by a circulating pump and injection. A picture of this operation set-up was taken. Colowyo has vigorously pursued maintenance of this pond." The report goes on to describe the breach of the West Pit treatment cell reported to you and me on May 4 by Cotowyo. This Colowyo report included that there were recent rains and snows. An extract of a drawing and two photographs have been enclosed in response to our telephone conversation of September 23, 1999. Enclosure 1 is an extract of Exhibit 10 from the Colowyo Coal Company L.P. 1998 Annual Report (Reclamation and Hydrology). The East Taylor Pond is in the vicinity of coordinates E 134850 N346300. The West Pit is being developed in the area east of E 1349000 and north on N345000 (just south of the Section 4 designation number). Overburden spoil from the West Pit is located just north and north east of the Section 4 symbol. The treatment cell is located in the vicinity of coordinates E1349500 N346200. The area is better visualized from the photograph at Enclosure 2. This picture was taken on 1-19-99. The view is slightly west of north. East Taylor Pond is located at the intersection of tick marks A and B. The treatment cell was constructed in the vicinity of the intersection of tick marks C and D. At the time of the. inspection, water was flowing in the north ditch of the haul road (tick marks A and F, G and H), over the embankment in the vicinity of tick mazks E and F, and into the East Taylor Pond. This flow was of runoff from the haul road, and fill roads and areas to the immediate north. This ditch flow crossed the road up to the treatment cell (the cell at a higher elevation than the crossing) in