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STATE OF COLORADO <br />DIVISION OF MINERALS AND GEOLOGY <br />Department of Natural Resources <br />1313 Sherman St., Room 215 <br />Denver, Colorado 80203 <br />Phone: (303) 8663567 <br />FAX: (303) 832-8706 <br />March 16, 2006 <br />New Elk Coal Company, LLC <br />C/O Ron Thompson <br />Peak Project Management <br />34115 Co. Rd. 20.8 <br />Trinidad, Colorado 81082 <br />RE: Permit Transfer of the New Elk Mine, #C-81-012 <br />Dear Mr. Thompson: <br />OLORADO <br />( V I S I O N O F <br />IIN SRALS <br />EOLOGY <br />UANATION•NINING <br />SAFETY•SCIENCE <br />Bill Owens <br />Governor <br />Russell George <br />Executive Direttor <br />Ronald W. Canany <br />Division Director <br />Natural Resource Trustee <br />The Division of Minerals and Geology received on February 10, 2006, an application for <br />the transfer of permit #C-81-012 from Picketwire Processing, LLC to New Elk Coal <br />Company, LLC. A transfer of an existing coal permit is allowed under Rule 2.08.6, <br />Transfer, Sale, or Assignment of Permit Rights of the Rules governing Coal Mining. <br />The materials received included a completed application on a form approved by the <br />Board. Noted in the cover letter is the absence of the submittal of a new bond in <br />compliance with Rule 2.08.6(2)(a)(iii). This bond will come under separate cover. The <br />required amount of bond to be submitted is $3,038,059.00. <br />The application identifies Picketwire Processing LLC as the "permittee", who wishes to <br />assign the permit to New Elk Coal Company, LLC as the "successor". Names an <br />addresses of each entity are provided on the form in compliance with Ruie <br />2.08.6(2)(b)(i) and (ii). The names and address of the successor's resident agent is <br />found on revised text page 2.03-4 and identified as Ron Thompson of Peak Project <br />Management. <br />Rule 2.08.6(2)(b)(iii) requires information be submitted for Rules 2.03.4, 2.03.5, 2.03.6, <br />2.03.7(3), 2.03.9, and 2.03.10. <br />Rule 2.03 <br />1. Please modify text page 2.03 to include the telephone numbers and the <br />employer identification number of the applicant, applicant's resident agent, and <br />person who will pay the abandoned mine fee. (2.03.4(2)(a)-(c)) <br />2. Please modify text page 2.03-4 to include the percentage of ownership of each <br />of the officers and directors. (2.03.4(3)(6) <br />3. Please move the text under heading 2.03.6 that identifies property owners to the <br />appropriate location under the heading 2.03.4 Identification of Interests. This <br />Office of OfFce of Colorado <br />Mined Land Reclamation Active and Inactive Mines Geological Survey <br />