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-9- OPERATIONS AND RECLAMATION PLAN The proposed permit area is located approximately 2 1/2 miles southeast of Durango, Colorado, with access from U.S. Highway 550-160 on an existing light duty road. The proposed Carbon Junction Mine will be a surface mine, with private mineral and surface ownership. One hundred seventy-four acres are proposed to be permitted. The life of the mine is estimated at 5 years. Disturbed areas include 50.8 acres for the mine pit, 26.7 acres for an overburden fill area, 4.3 acres for a staging area and 26.8 acres for the remaining mine facilities. Surface facilities include an office building and scalehouse; change-room and showers; a wash/processing plant, stacker, coal storage area and reclaim tunnel; employee parking area; equipment storage yard and repair shop; explosives storage van, detonator magazine and dynamite storage magazine; two slurry ponds for the wash plant; a storage pond for wash plant water; a fresh water well; a domestic water storage tank; conveyors; a coal storage area, and a truck loading area. There is also a light vehicle access road and a coal haul road. The mining method is an open pit style surface mining method where three seams dip at an angle of 26 to 30 degrees and outcrop in a northeast/southwest direction across hill and valley arrangements. The planned pit covers an area of 50.8 acres and is bounded on three sides by the economic limits of the planned pit. The pit has a maximum highwall of 470 feet and uses an out-of-pit fill for portions of the overburden until a steady-state pit is developed. Prior to any of the mining events, woody vegetative cover will be bladed into a pile for preparation of soil salvage and storage. Next, all available topsoil will be removed and stored for redistribution. After the topsoil has been removed, an initial pit will be opened to provide sufficient room to create a haulback method of open-pit mining. The initial cut material will be placed in the fill. The mining will proceed by placing the sequential cuts in the mined out area. The final cut will be backfilled and regraded. It is planned that the massive sandstones overlying the Lewis seam will be placed mostly at the bottom of the pit, with the remaining siltstone, sandstone and shale placed on top of it. The suitable soil will be removed and directly redistributed over the regraded area, in sequence with mining, as much as possible. If additional topsoil is needed, it will be taken from the topsoil stockpiles. Soils will be tested just prior to respreading to determine application rates of nitrogen and phosphorus. Small tree seedlings and shrubs will be removed from topsoil stripping areas and mechanically transplanted to reclaimed areas concurrently with the distribution of topsoil during the dormant season.