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STATE OF COLORADO DIVISION Of MINERALS AND GEOLOGY Department of Natural Resources 1313 Sherman St., Room 215 Denver, Colorado 60203 Phone: (303) 866-3567 FAX: (303) 832$106 SETTLEMENT AGREEMENT JUSTIFICATION Seneca Coal Company Seneca II-W Mine-Permit Number C-1982-057 Notice of Violation No: CV-2003-015 James B. McArdle, Conference Officer COLORADO DIVISION O F MIN SRALS GEOLOGY RECLAMATION•MINING SAffTY•SOIENCE Bill Owens Governor Greg E. Walther Executive Director Ronald W. Cattany Division DIIPC[01 Natural Resource Trustee The Notice of Violation Number CV-2003-015 was issued on November 21, 2003 for failure to implement all aspects of the approved aspen transplanting field trial study in accordance with the permit schedule. Specifically the operator did not locate, select, dig and store suitable site- native aspen saplings during October 2003 for dormant transplanting into the field trial study plots in May 2004. On January 27, 2004, an Assessment Conference was held at the Division of Minerals and Geology Office located at 101 South 3"', Suite 301, Grand Junction, Colorado 81501. In attendance, in addition to the Conference Officer, was Mr. Dan Mathews and Mrs. Sandra Brown representing the Division and Mr. Roy Karo and Mr. Dennis Brigay representing the operator. Dan presented testimony and photographs of the Aspen grove and the study plan and schedule. An agreement was reached between the surface owners, Division of Wildlife, Operator and the Division that trees would be located and salvaged by October 2003 for storage and transplanting in the spring of 2004. Topsoil has been removed and stockpiled on a portion of the site. It is now understood that there are very few trees of an appropriate size within the aspen grove being removed to achieve the desired result of the transplant plan and schedule. Mr. Roy Karo stated that Dr. Shepard and Dave Buckner are now officially involved with the project. The original schedule, which was to commence in the fall of 2003, was unrealistic; therefore, a technical revision has been submitted to the Division moving the project ahead by one year. Cost of the transplant project and study was also discussed. The Proposed Civil Penalty originally determined by the Assessment Officer for CV-2003-015 was: History Seriousness (Low\Moderate) Fault (Negligence) Number of Days Penalty Assessed Good Faith Total proposed penalty Office of Mined Land Reclamation $100.00 $750.00 $750.00 1 0 $1,600.00 Office of Active and Inactive Mines Colorado Geological Survey