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3737 Hwy 133 P.O. Box 535 Somerset, Colorado S 1434 USA "tel (970)929-5122 Fax (970)929-5177 ~~C~~V ~ R n 4 September 3, 2004 SEP 4 8" 2~~ Mr. Allyn Davis, District Manager Olvi:ion of fainorals and Ge~lp4p Mine Safety and Health Administratio~ivision d Minerals and Gao 0 PO Box 25367 Denver, CO 80225-0367 Re: Elk Creek Mine ID #OS-04674 Dear Mr. Davis, Oxbow Mining, LLC and the Elk Creek Mine plan on discharging process water into the C-Seam of the abandoned Somerset Mine. This letter and attached drawings shall serve as a Waste Water Disposal Plan. In order to discharge water into an underground mine, an operator must comply with certain state and federal regulations. The Colorado Division of Minerals and Geology (CDMG) is the state agency with regulatory authority over the Elk Creek Mine. CDMG Rule 4.05.16(6) states that any discharge of water into an underground mine will "meet with the approval of MSHA." The Office of Surface Mining Reclamation and Enforcement (OSM) has a similar requirement listed under 30 CFR 817.41(h)(I)(iv) which states that discharges into an underground mine will "Meet with the approval of MSI-IA." Procedure Instruction Letter No. I03-V-4 extends the responsibility for approval of plans to discharge water into abandoned mine workings to the Coal Mine Safety and Health District Managers. Program Information Bulletin No. P03-16 also gives authority to MSHA for approval of plans. However, PIB No. P03-16, 30 CFR 784.25(a), and 30 CFR 817.81(f) seemingly do not strictly apply to the discharge of water into underground mines. These regulations seem to be more concerned with slurry discharge and backfill operations. Oxbow Mining, LLC intends to pump water directly out of the Elk Creek Mine sump into the Somerset Mine. This is not a slurry product, nor is it intended as a backfill that needs to support a surface area. The total volume of the Elk Creek Mine sump is slightly over 5 million gallons. The amount of water that will be pumped into the Somerset Mine will be up to 3 million gallons. The water will be pumped into the 8 West Section of the Somerset Mine, at an elevation of approximately 6,000 feet. This section may hold up to 16 million gallons. The exact volume available is unknown because the coal was extracted utilizing a room and pillar system. The pillars were then robbed on retreat. Subsequent subsidence may have decreased the amount of space available. The Elk Creek Mine sump will not need [o be pumped again for approximately one year. This cycle will continue, pumping up to 3 million gallons once per year into the Somerset Mine. Each pumping cycle may last up to 10 days. Monitoring of water levels will be done in compliance with CDMG regulations. As shown on the attached drawings, the borehole that will be drilled into the Somerset Mine does not pass through [he Elk Creek Mine workings. The borehole will be cased and cemented so that water cannot flow into the surrounding strata.