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i Peabody Twentymile Coal Company September 22, 2005 Mr. Byron Walker, Environmental Protection Specialist Division of Minerals and Geology 1313 Sherman Street, Room 215 Denver, Colorado 80203 (303)866-4941 29515 Routt County Road k27 Oak Creek, CO 80467 970.879.3800 FiEDE~!!ED 5Ei' 2 8 2005 Diuision ~f Minerals and Geology RE: Foidel Creek Mine (Permit No. C-82-056) -Technical Revision (TROS-49), Coal Refuse Storage and Handling Procedures for Existing Refuse Pile, Bond Calculation Comments Dear Mr. Walker: As we discussed, Twentymile Coal Company (TCC) reviewed the bonding calculations for TROS-49 provided on June 24, 2005. Based on this review, I have concerns that the calculated reclamation costs do not accurately reflect the actual costs for the incremental reclamation activities required to address temporary refuse placement requirements and, in fact, significantly over-estimate the costs. The following summarize these concems and provide supporting rationale, with duect references to the CDMG bonding calculations. Costs Associated with Haulage of 1.OMM Cv of Refuse from Temporary Stockpile Area to Central and Northern Portions of the Refuse Pile - $943.450 The pemut text reflects temporary stockpiling of up to 1.OMM cy of refuse in the southern portion of the refuse pile (Area 3). In reality, the actual maximum volume that has ever been stockpiled in this area is closer to 400,000 cy. This volume includes; 1) Refuse material from initial processing of low-quality coal recovered from the coal mine waste disposal pit (Pit Area 1) and placed during initial construction of the pile in 1997; and 2) Unconsolidated refuse materials placed during contractor operation of the wash-plant during the late 70's and eazly 80's. TCC has been actively working to incorporate this material into the active refuse disposal azea since 2003 and, to date, has dozed approximately 320,000 cy of refuse material from Area 3 of the refuse pile (temporary storage area) to Area 2.5, where the material has been placed, spread, and compacted, consistent with design specifications. A total of approximately 80,000 cy of unconsolidated refuse material remains in temporary stockpile in Area 3. TCC does not anticipate any future need to temporarily stockpile refuse material in Area 3, and anticipates using this area for future final refuse placement once the underlying clay cover materials can be recovered and refuse fill levels in fill Area 2 reach the southern limit of Area 3. Accompanying this transmittal is a revised text discussion, clarifying past, present, and anticipated future temporary stockpiling volumes and plans. TCC has and continues to operate the refuse pile as a segmented disposal area. Other than the material referenced above, which was recovered from the coal mine waste disposal pit and placed in the temporary stockpile area, initial refuse placement began at the low point of the pile in Area 1 (north end of refuse pile, as shown on the accompanying copy of Map 24). Area 1 of the refuse pile is neazly full, with the top elevation of the refuse fill in this area approaching maximum design elevation. TCC has reclaimed the northeast slope of Area 1, anticipates completing final refuse placement in Area 1 early next year, and plans to complete final reclamation of this portion of the refuse azea during 2006. As refuse placement in Area 1 proceeded to the point where fill levels reached the northern limit of Area 2, TCC initiated simultaneous refuse placement in Area 2. TCC has proceeded with concurrent refuse placement in Areas 1 and 2, bringing these two azeas up to maximum design Bade simultaneously. Area 2 is the current primary refuse fill area.