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Mr. Jack Peryatel, President <br />January 23, 1989 <br />Page 2 <br />• 12) Raton Gas Company could determine the total <br />tons of coal that are contained within the 500 <br />foot boundary by drilling or other means <br />acceptable to both parties, then pay Rimrock Coal <br />a lump sum for its lost profits. <br />(3) Implement the provisions set forth by Lewicki <br />and Associates to mine within 500 feet of the gas <br />pipeline. <br />If these procedures are implemented, Mr. Davis will not <br />be liable for any of the costs or will he conduct the <br />seismic surveys requested. Mr. Davis will only furnish the <br />drill holes, explosives, fuses, delays, and other blasting <br />supplies necessary for each blast within 500 feet zone of <br />the pipeline. The actual blasting must be conducted by <br />personnel employed by or representing Raton Gas Company. <br />In addition, before mining commences within the 500 <br />foot restricted zone, Raton Natural Gas must determine the <br />maximum damage that could be incurred by an explosion in the <br />gas pipeline, caused or related to the coal mining activity, <br />the worst scenario. Raton Natural Gas will be required to <br />• obtain liability insurance at one and one half times this <br />amount to cover this possible event. <br />In the event that the proc~ <br />subparagraph (3) above is implemented, <br />coal that can not be recovered by Mr. <br />All of the coal lying under the zone <br />either side of the pipeline. Mr. Davis <br />compensation for this coal. <br />:dure outlined in <br />there will be some <br />Davis' operations. <br />within 50 feet on <br />is also entitled to <br />This gas pipeline problem is causing an unacceptable <br />delay in filing the mine permit application with the Mined <br />Land Reclamation Division. If a satisfactory answer to this <br />problem can not be arrived at immediately, then Mr Davis <br />will be forced to rely on the provisions set forth in <br />Article 9 of the License Agreement signed between Raton <br />Natural Gas Company and Colorado Fuel and Iron Corporation, <br />dated September 13, 1963. This provision clearly states that <br />the Mr. Davis, as the successor to CF&I, has the right to <br />terminate the agreement, as it is obvious that the gas <br />pipeline interferes with Mr. Davis' proposed use of the <br />premises. Under the termination clause the pipeline must be <br />removed from the property within ninety (90) days at the <br />expense of Raton Natural Gas. <br />• We would appreciate your response to this request at <br />your earliest convenience. Hopefully we can resolve this <br />