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November 3, 1994 <br />Page 2 <br />The residents along Highway 12 have recently observed a <br />white foaming substance in a sediment pond on the New Elk <br />mine property. Basin is presently under a Cease and Desist <br />Order at the Golden Eagle Mine for polluting violations. We <br />have determined that the "white foamy substance" was dumped <br />into a sediment pond with the following designation: Outfall <br />number 004, CO 0000906 located at the New Elk mine. Please <br />advise if this sediment pond is lined, and the composition <br />of the strata surrounding the pond. <br />We have contacted Pat Nelson with the Colorado Water <br />Control Division to test the water in this sediment pond, <br />discharge poi~it and various points downstream from this <br />location to determine if the Purgatorie River is being <br />polluted. <br />In a November 1, 1994, letter to our Houston office <br />from Holland & Hart, Basin's attorneys, Basin denies that <br />they are polluting the Purgatorie River. They further <br />state, "We are adare of no other incident creating any <br />adverse effect on aquatic life or the environment from the <br />Basin Resources mine." They naturally do not acknowledge <br />the Cease and Desist Order signed on August 29, 1994, which <br />is still pending further action. <br />The emission permits issued to the Basin mines do not <br />contain enough enforceable language to force the mines to be <br />responsible to the residents. Such language "as necessary" <br />which refers to the self monitoring aspect of the permit is <br />vague at best. <br />Basin refuses to be honest, to comply with the permits <br />issued by the State with regard to emissions, and discharge <br />permits. I have been advised that Basin was issued a permit <br />from Colorado Air Enforcement, I would like a copy of that <br />permit. <br />It appears that the State is expecting the mining <br />industry to be self monitored. It is obvious that this does <br />not work. I ]cave been advised that there is a move on in <br />Washington to force the Federal government to withdraw from <br />monitoring the State. I have not seen evidence which would <br />lead me to believ> that the State is capable of controling <br />or monitoring Basin Resources, Inc. <br />Basin, once served with a complaint, a violation if you <br />will, with reg~~rd to an infraction, has 10, 15, 30 days to <br />respond to said violation, at which time they can appeal to <br />Washington, and days then turn into weeks, and months while <br />the infraction or violation is discussed and fines, if <br />deemed <br />