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~1 <br /> <br />CLIMAX MOLYBDENAUMvCOMPANY <br />A DIVISION OF AMAX INC. <br />HENDERSON MINE <br />Box 68 <br />Empire. Colorado 80438 <br />(303) 569-3221 April 4, 1988 <br />~, Iz°7 <br />:. r ~.. <br />Ms. Margaret Winter, Chairman `~~ " <br />Colorado Mined Land Reclamation Board ~i ~,IJVg <br />1313 Sherman Street, Room 423 <br />Denver, Colorado 80203 <br />.. .i:~l. Cl ~`:• <br />Re: Technical Revision to Henderson Mine Permit No. 77-342 ''~` '- <br />rR o5 <br />Dear Ms. Winter: <br />Our initial approach to intermediate range reclamation objectives, conceived <br />and implemented in better economic times, has undergone intensive review <br />recently due to the depressed molybdenum business climate. We have endeavored <br />to re-fashion solutions that allow us to meet our reclamation obligations <br />while giving maximum consideration to the amount and timing of expenditures. <br />The current business climate has dramatically effected the rate of production, <br />the life of the mine, and the resulting timing of reclamation. At the current <br />reduced production rate of 18-million pounds of molybdenum in concentrates per <br />year the life of the mine is extended from previous estimates by 4 years to <br />the year 2020. <br />Due to dramatic changes in the rate of production, the life of i:he mine, the <br />timing of reclamation, and increasing cost of surety bonding we request a <br />~.l,dz,•l~ o~ technical revision; 1) to institute an alternate form of bonding, 2) to <br />1 establish a reclamation trust fund, (3) to revise the soil covE~r on tailing <br />"~ '~0' requirement, and 4) to revise the soil stockpile plan. <br />1. Alternate Form of Bondin <br />~'" We wish to substitute a letter of credit or other surety mechanism for <br />d,~ J current surety bonds. Based on our information, there area alternative <br />~Q. .lower-cost surety mechanisms which are recognized under Colorado law. <br />During the last nine years our annual bond cost has increased 547 percent <br />while the estimated reclamation costs which require bonding h~3ve increased <br />235 percent. <br />2. Reclamation Trust Fund <br />~,,,a We wish to establish a reclamation trust fund (sinking fund) and make <br />~ 11" periodic payments into the fund as allowed by Colorado law. As the fund <br />~;(~ builds in value, the letter of credit or other surety mechanism will be <br />reduced in cost. This fund will build over the remaining 32-year life of <br />the mine (1988-2020) to cover future reclamation costs. <br />