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Regional Geology <br />The Hamilton Mine is located near the axis of the Nucla Syncline (San Miguel Syncline) a <br />shallow, broad synclinal fold running northwesterly for 65 miles. No evidence of faults has <br />been observed in drill holes at the Hamilton Mine area. The Nucla Syncline is 10-15 miles <br />southwest of the major regional geologic feature of the area, the Uncompahgre Uplift. The <br />region lies in the Dolores River Basin. The mine is located one and one half miles south of the <br />San Miguel River. <br />The mine is located in the Nucla-Naturita Coal Field. The coal is found in Late Cretaceous <br />sediments. The youngest Cretaceous rocks in the area consist of Mancos Shale, a dark gray <br />marine shale, present only on isolated hilltops south of the town of Nucla. Two hundred feet <br />of Dakota sandstone outcrops extensively along the axis of the Nucla Syncline. This formation <br />consists of a yellowish-gray, fissile sandstone and conglomeratic sandstone interbedded with dark <br />gray shale and coal. There are nine coal seams within 100 feet of the base of the Dakota. The <br />Lower Cretaceous unit in the area, the Burro Canyon Formation, is separated from the Dakota <br />by an unconformity. The Burro Canyon is comprised of white, gray and light brown sandstones <br />and conglomerates interbedded with green and purplish shales, siltstones, mudstones and thin <br />beds of limestone. This formation has a maximum thickness of 200 feet and outcrops on rims <br />of canyons northwest of the mine. This formation is difficult to differentiate from the Dakota <br />in this area, and is commonly considered hydrogeologically similar. <br />Five coal seams have been identified in the horizon to be mined in the permit area. They are <br />identified, in descending order, as the Upper Dakota-1, (UD-1), Lower Dakota-1, (LD-1), <br />Lower Dakota-2, (LD-2), Lower Dakota-3 (LD-3), and Lower Dakota~3, (LD-4). The LD-2 <br />and LD-3 seams are of a minable thickness throughout the permit area. In the southern portion <br />of the permit area the LD-4 seam is of a minable thickness. The thickness of the LD-2 seam <br />ranges from 1.6 to 3.5 feet thick with an average thickness throughout the permit area of 2.5 <br />feet with depths form the surface to the top of the seam ranging from 7.2 to 28.7 feet. The <br />LD-3 seam averages 1.6 feet thick and ranges from 0.8 to 2.9 feet thick. The LD-4 seam <br />ranges from 1.2 to 3.1 feet in thickness with an average of 2.1 feet. <br />The splits between coal consist primarily of thin, lenticular, dark, carbonaceous shales. The <br />split between the LD-2 and LD-3 seam ranges in thickness from 0.3 to 1.0 feet with an average <br />of 0.6 feet thick throughout the permit area. The split between the LD-3 and LD-4 seam <br />averages a thickness of 1.1 feet and ranges from 0.7 to 1.7 feet in thickness. Any splits within <br />the seams of thickness less than 0.3 feet will be taken with the coal during the mining operation. <br />There are two rider coal seams identified in the permit area, referred to as the UD-1 and LD-1 <br />seams. Neither rider seam is consistent in extent within the permit area and therefore not <br />considered minable. Where identifiable, the UD-1 and LD-1 rider seams are as much as 1.2 <br />and 2.0 feet in thickness, respectfully. Rider seam LD-1 overlies an average .08 feet thick dark <br />shale layer. The stratum which overlies the LD-1 rider seam and underlies the UD-1 rider seam <br />consists of an average 7.0 feet thick gray shale. The stratum overlying the UD-I rider seam <br />consists of a soft, yellowish, fine-grained sandstone that varies in thickness from 2.8 to 19.0 feet <br />thick from the top of UD-1 to the ground surface. <br />4 <br />