2004-08-16_REVISION - M1988044 (2)

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Southwestern Vegetation Analysis [#-~., EeolOgleal Wetland Ecology Services Lend Rehabilitation Planning Photodocumentation 37 East Colorado Avenue Denver, Colorado 80210-3105 (303) 722-9067 Fax (303) 778-8937 RECEI VE® August 13, 2004 Susan Ericksen or Barbara Chiappone Division of Minerals and Geology Room 215 1313 Sherman Street Denver, CO 80203 RF: Incomplete Financial Warranty Reduction Request; Coal Creek Resources Permit M-1988-044 / Dear Susan or Barbara: ~~-~/ Thank you For your letter of August 11, 2004. You bring up two points that you believe makes the bond reduction request incomplete. Following are responses to those items. Rule 4.14.1(2)(h): None of the land included in the request is bonded. Therefore there does not need to be a recalculation based upon the removal of that land. Under the new system of bonding this operation, only land that has been affected and not released or land that is expected to be affected in the near future is bonded. If more land is needed then a bond increase is requested and that increase is tied to the new cost of bonding that land plus whatever else is still bonded. In March 2004, 31 acres was added to the affected land via Technical Revision and the bond increased to $310,000. Only a small portion (about 3 acres) of that 31 acres has been affected since that increase. Therefore, there is about 28 acres of unaffected land that is fully bonded. In light of the land being requested not being bonded, the operation being effectively overbonded by 28 acres and the bond having been reviewed just a few months ago there does not seem to be much point in recalculating the reclamation costs at this time. Furthermore, within the next few months an amendment is expected to be submitted for this operation that will probably be well over 1,000 acres. If you still feel that a reclamation cost calculation is required please let me know, but it is our position that such a recalculation would generate a value of very near $310,000, the current bond. Rule 4.17.1(3): I am not exactly what you are saying in this item. The request was sent via Certified Mail with a Return Receipt. In fact, the request letter contains the certified mail number. A copy of the certified mail receipt, the receipt from the Post Office, and the Return Receipt, and the request letter are enclosed. If you have any additional questions, please call. Sincerely, Mark A. Heffner AUG 16 '2004 -~ Certified Mail Number 70011940000530648295notMineralsandGeology cc: Scott Davis