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Dr. W.D. Corley, Jr. -2- March 9, 1994
<br />The Corley Company
<br />There does appear to be an inclusion of Weckerling liability in a GEC permit. When the
<br />Board issued Conversion/Amendment Permit No. 77-48 to GEC Minerals on August 26,
<br />1977, the following language was included in the permit: "GEC Minerals desires to
<br />consolidate and convert all previously held permits to include all lands previously mined
<br />since July 1, 1969, and all lands presently permitted which have not yet been mined, and
<br />to amend the existing permit by an addition of acreage." The permit also stated, "previous
<br />bonds supplied by GEC Minerals, Inc. will be released by the Board upon submission of a
<br />new comprehensive bond which specifically includes coverage of lands previously mined
<br />but not reclaimed by GEC and its predecessors under previous permit bonds." The permit
<br />then listed the legal description for the lands covered under this permit, which is shown in
<br />Exhibit K7.
<br />3. /s there any record of the release of the bonds?
<br />With regard as to whether records exist documenting the release of bonds submitted by
<br />Canon Coal Corporation, there appears to be one indirect record of such a release, as
<br />discussed in Summary Items 26-28. Bond No. 400 BB 3347, issued to The Corley
<br />Company on December 12, 1972 for 515,000.00 for lands in Sections 7 and 18, T20S,
<br />R69W, and Sections 1 and 12, T20S, R70W, was apparently supposed to have been
<br />replaced by The Corley Company by a different 515,000.00 bond. This second bond,
<br />however, whose number was apparently 400 DP 5818, does not appear to have been
<br />submitted.
<br />On June 26, 1973, Canon Coal filed their application for the Corley S and A Mine in
<br />Section 1, T20S, R70W. On August 8, 1973, a Name Change Rider from the St. Paul
<br />Companies was submitted to the Division, requesting tfie name on Bond No. 400 DP 5818
<br />be changed from The Corley Company to Canon Coal Corporation. Because Bond
<br />No. 400 DP 5818 had apparently not been submitted, this form served no real purpose,
<br />and Bond No. 400 BB 3347, submitted by The Corley Company to the Division on
<br />December 18, 1972 for 515,000.00, remained the bond covering Canon Coal's
<br />operations.
<br />On June 28, 1978, the Board released The Corley Company from reclamation liability in
<br />"Sections 1, 7, 8 and 12 of T19S, R70W." However, the actual legal description should
<br />have been Sections 7 and 18, T20S, R69W, and Sections 1 and 12, T20S, R70W. When
<br />this release occurred, Canon Coal no longer had a bond covering its operations in Section 7
<br />and 18, T20S, R69W, and Sections 1 and 12, T20S, R70W.
<br />Records documenting the release of Canon Coal's Financial Indemnity Bond No. 235623E
<br />for Section 24, T20S, R70W, or Canon Coal's Insurance Company of North America Bond
<br />No. M908225 were not found; however, GEC's responsibility for reclamation of mining-
<br />related disturbances in Sections 19, 30, and 31 of T20S, R69W, and Section 24, T20S,
<br />R70W, was specifically identified in GEC's Conversion/Amendment Permit No. 77-48, and
<br />the Associated Hartford Accident and Indemnity Bond No. 4312804 in the amount of
<br />566,440.00.
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