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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 />Vhone: (303) 866-3567 <br />FAX: (303) 832-8106 <br />DIVISION OF <br />MINERALS <br />GEOLOGY <br />RECLAMATION <br />MINING•SAFETY <br />Bill Owens <br />Governor <br />Greg E. Walther <br />SETTLEMENT AGREEMENT JUSTIFICATION Executive oirector <br />Blue Mountain Ener ,Inc. ftona(d W. Cattany <br />9y Acting Division Director <br />Deserado Mine-Permit No: C-1891-018 <br />Notice of Violation No: CV-2002-017 ~ <br />James B. McArdle, Conference Officer <br />The Notice of Violation CV-2002-017 was issued on July 11, 2002 for improper ditch <br />construction or maintenance, which resulted in erosion of two sediment pond collection ditches. <br />Improper ditch maintenance which exposed a buried pipe segment which could have resulted in <br />disturbed area drainage being routed around the sediment pond and into Scullion Gulch without <br />treatment. <br />On September 24, 2002, an Assessment Conference was held at 1313 Sherman Street, Room <br />814, Denver, Colorado. In attendance, in addition to the Conference Officer, was Mr. Dan <br />Mathews, Mr. Jim Stark and Mrs. Sandra Brown representing the Division and Mr. Scott <br />Wanstedt and Mr. Jeff Dubbert representing Blue Mountain Energy. Dan presented testimony <br />and evidence in the form of photographs outlining the details of the violation. Ditch maintenance <br />severed a segment of 6 inch PVC pipe. The inlet end of the pipe segment extended at an angle <br />approximately 8-10 inches above the bottom of the ditch. High flows in the ditch could have <br />caused untreated water to discharge outside of the sediment pond. Erosion had occurred on <br />the lower segment of the prep plant.ditch and on a portion of the South Silo Ditch. <br />Mr. Scott Wanstedt stated that the erosion had stabilized and was allowing water to enter the <br />sediment pond. Since the erosion was routing the water to the pond and no problems were <br />noted, no action was taken to modify the erosion. Scott also pointed out that according to peak <br />flow measurements, water would not have entered the severed pipe. <br />The Proposed Civil Penalty originally determined by the Assessment Officer for NOV CV-2002- <br />017was: <br />History $0.00 <br />Seriousness $500.00 <br />Fault $750.00 <br />Number of Days Penalty Assessed 1 <br />Good Faith 0 <br />Total proposed penalty $1250.00 <br />