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floors. An alluvial valley floor may exist south of the application area in Hay Gulch, It is not anticipated that mining in the azea will affect the possible alluvial valley floor at Hay Gulch. GEOLOGY AND MINERAL RESOURCES The only known mineral resource contained in the project area is coal. The coal deposits occur within the Menefee Formation of the Cretaceous Mesa Verde Gmup and is within the Durango Known Recoverable Coal Resource Area (KRCRA). National King Coal is the only operating mine in the area at this time. There are no known oi] and gas deposits (NKOGD) in the proposed project area. However, oil and gas is known to occur in the Point Lookout, Gallup, Dakota Sandstone and the Paradox Formations in other Southwestern Colorado locations.. The proposed project area is characterized by hilly plateau tops cut by two ephemeral drainages. The elevation ranges from about 7,300 to 8,200 feet. The geologic formations outcropping in the area are the Cliff House Formation of the Cretaceous Mesa Verde Group and the overlying Quaternary alluvial deposits. The coal proposed for mining is coal bed 1 in the Menefee Formation which outcrops along the northwest boundary of the proposed lease area in the East Alkali Gulch drainage and also to the southeast along an un-named gulch ("No Name Gulch"). No quantitative data exists for subsidence on the proposed project azea; however, the surface effects of subsidence have been recorded on Federal leases P-058300, C-29125, and COC 49465 • approximately one mile south of the proposed project azea. The overburden thickness consistently ranges fi om 300 to 400 feet above coal bed 1 throughout the area of the existing leases as well as in the proposed lease azea. Subsidence is directly affected by the thickness of the coal seam mined (4.5 to 7 feet), the overburden thiclosess, and overburden composition. Subsidence will show as stress cracks up to a couple of inches wide. A condition of approval of National King Coal's mine permit revision for Lease C-29125 and subsequent permit revisions by Colorado Division of Minerals and Geology was that subsidence would be monitored on a quarterly basis. The purpose of the monitoring was to determine if any new subsidence was occurring and if the Huntington Ditch was being affected in any way. According to National King Coal records (Second Quarter Monitoring,1999),there aze nonew subsistence cracks in the areas requiring monitoring to date. All azeas, which lie above underground support pillars that have been removed, continue to be monitored on a quarterly basis for evidence of material damage . to the surface. Colorado Division of Minerals and Geology rules 2.05.6 and 4.20 require that "underground mining acrivities shaii be planned and conducted so as to prevent subsidence itom causing material damage to the surface" Material damage is defined in Rnle 2.05.6 with rwrecY to subsidence as changes which prevent restoration of affected structures and with respect to renewable resource lands; changes which disrupt an aquifer, or a recharge azea to an aquifer, which serves as a beneficial use Cf li'ate^ ^r Cn°~nges ' :.~C:: pr........ r"`.St.^."'..^..^.n "2 prC.^.:::, .t`i i..~ ay;'.lll.:.`a::an.^.S. ., .. There are no active faults adjacent to or on the prof ecY area (Zapp, 1949). No other geologic hazards 8