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Mr. Joe Carpio - 2 - January 27, 1989 On July 1, 1987, the investing partners filed an action in La Plata County District court seeking appointment of a receiver to take possession of the mine and an injunction preventing La Plata Coal Corporation from operating the mine without regulatory approval. The Durpose of this was to prohibit operations at the site that might be detrimental to the interests of the investing partners. On July 23, 1987, La Plata Coal Corporation filed for bankruptcy. This, in effect, caused the legal proceedings in the District Court to be automatically stayed. Permit C-87-072 was issued to La Plata Coal Corporation by the Division, with the approval of the bankruptcy court on November 20, 1987. Operations began shortly after permit issuance. On January 6, 1988 La Plata's bankruptcy case was dismissed with no action being taken by the court. Following this, the investing partners reinstated their original legal actions in the La Plata District Court. The District Court appointed a receiver for the mine on February 12, 1988 and issued an "Order Establishing Partnership Issues". The Division received notification of temporary cessation from the receiver on February 19, 1988. Notices of Violation C-88-004, 005 and 006 were issued to La Plata Coal Corporation on January 27, 1988. Notice and order to Pay Fixed Penalty for the above NOV's were issued and sent certified mail to La Plata Coal on April 5, 1988. They were returned unclaimed on April 28, 1988. A judicial sale was held on October 6, 1988 at the La Plata County Courthouse. The purpose of the sale was to dispose of all assets of the La Plata Coal Corporation. The mine, including all inventory, equipment, fixtures, leases, mineral interests, real properties, permits, licenses, maps and personal property associated with operation and maintenance of the mine was exposed to sale at public auction. Most of the equipment and structures were sold but the real property, leases, mineral interests and permits were not sold. Since this date all certified mailings to La Plata Coal Corporation have been returned as undeliverable to the Division. In addition, there is no one the Division can contact who has maintenance responsibility for the site. As mentioned above there remain unabated violations at the site and unpaid civil penalties. All indications are that the site has been abandoned, with no indication that the responsible party intends to reclaim the site. As indicated in the enclosed Show Cause Order, this matter will be scheduled fora formal hearing before the Mined Land Reclamation Board. In addition to permit revocation consideration, the Division will pursue forfeiture of the reclamation bond at the formal hearing. It will be scheduled for the March, 1989 Board meeting. We will notify you at least 30 days prior to the hearing of the date, time and location.