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Somerset Mine - 2 - April 24, 1987 In regard to the maintenance of the permit document, several outstanding issues remain. Those issues are discussed further in this letter. To resolve the issues, the permit document needs to be corrected. Our preference would be that U.S. Steel and Kaiser Coal work together to ensure that this is accomplished. A significant aspect of this is that the Division believes that the mine site is substantially underbonded. This is addressed in the next section, Bond. Bond During the midterm review of the permit and the adequacy of the bond, it became apparent to the Division that the maps used to describe the site conditions were in error. These maps are an important component in calculating reclamation costs. The Division inspected the site to identify the conditions that exist which differed from the map. Adjustments in material volume and other details were made to verify the differences and the reclamation cost was recalculated. The Division estimates that the cost of reclamation is $1,853,000.00. We currently hold a Corporate Surety issued to U.S. Steel by Federal Insurance Co. (Bond No. 8098-83-96) in the amount of $575,000.00. The site is underbonded by $1,278,000.00. The reclamation cost estimate is enclosed with this letter. The Division recognizes that modifications to the mine plan or supplying additional information could reduce the required bond amount. However, as previously stated, efforts to have Kaiser Coal modify the mine plan or provide information have failed thus leaving the Division with no alternative but to determine the reclamation liability as we have. It is imperative that this problem be resolved as soon as possible. As such, the Division is requesting that bond in the appropriate form and amount be posted by June 15, ]987. In the event that this is not accomplished, the Division will seek appropriate remedy in accordance with the Colorado Surface Coal Mining Reclamation Act (Act). It is our objective to ensure that the operation is properly bonded, and we will assist the parties in whatever way we can to accomplish that objective. Reclamation Plan Deficiencies Permanent reclamation activities will occur in the Bear Creek, Hubbard Creek and Elk Creek drainages. Serious deficiencies have been identified in the reclamation plan for the respective areas. The major deficiencies are listed below. A. The facilities maps for all disturbed areas were drafted in 1976. They do not reflect current conditions and are not acceptable for reclamation purposes. The Division needs current maps of the Elk Creek yard area, the sewage leach field and access road, pump house, new water pipeline and 200,000 gallon water tank, the upper and lower Hubbard Creek facilities, the Bear Creek fan and portal facilities, all degasification facilities, and all roads within the mine permit boundary.