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,_ <br />~- <br />DIVISION OF MINERALS AND GEOLOGY <br />Depanmem of Natural Resources <br />1 } 13 Sherman St., Room ? 15 <br />Denver, Colorado BO?03 <br />Phone: I}037 866-3i6i <br />FAX: 13031 83?-8106 <br />June 22, 1999 <br />Jim Stover, P.E. <br />J. E. Stover & Associates <br />2768 Compass Drive, Suite 101 <br />Grand Junction, Colorado 8]506 <br />RE: Technical Revision No. 28, Reclamation Bond Estimate, Bowie No. 1 Mine, <br />Permit No. C-81-038, Bowie Resources Limited. <br />Deaz Mr. Stover: <br />~~gii <br />DIVISION O ®r <br />MINERALS <br />GEOLOGY <br />RECLAMATION I' <br />MINING•SAF ET7I <br />Bit I Owens <br />Gnvemur <br />Greg E. Walchrr <br />Executive Dveaor <br />ht¢hacl B. Lnng <br />Division Director <br />Attached is the Division's estimate of the reclamation bond liability for the Bowie No. 1 Mine. <br />This estimate is for the reclamation plan modifications contained in Technical Revision No. 28 <br />and carried over to Permit Renewal No. 3. <br />The currently approved reclamation bond liability is $4,217,497. The Division's new estimate is <br />$6,401,926. The initial 1995 Midterm Review reclamation bond liability was estimated to be <br />$4,507,561, which essentially involved only updating the cost data. No change in the reclamation <br />plan had been anticipated at that time. With this new estimate, the reclamation bond has been <br />increased due to a change in the reclamation plan as well as to an updating of the cost data. <br />There are two dramatic cost increases and several smaller cost increases associated with the new <br />bond that contributes to the $2.2 million increase over the original 1995 Midterm estimate. The <br />first of the large cost increases was in the backfilling. The new reclamation plan changed the <br />volume of earth being moved from 372,481 cubic yards to 653. ] 98 cubic yards (an increase of <br />280,717 cubic yards). This increase in volume led to a cost increase from $632,654 to <br />$1,451,234 (an increase of $818,580}. The second large cost increase was in the structural <br />demolition. The cost for demolition increased from $2,243,006 to $3,014,841 (an increase of <br />$771,835). These two cost increases accounted for $1,590,415 of the total increase. <br />The minor cost increases include compaction (an increase of $71,070), nuclear density testing <br />($52,310), water augmentation during backfilling ($70.751), revege[ation ($ ] 6,621), <br />unobilization/demobilization ($13,901) and bulldozer ripping ($18,310). These tasks accounted <br />for a total cost increase of $242,963. <br />III IIIIIIIIIIIIIIII <br />`~ <br />STATE OF COLORADO <br />