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Ms. Anna Beierle Page 2 September 12, 2002 Approach For a simple and logical approach to conveyor demolition cost estimating, the entire proposed conveyor system was divided into six components: (1) conveyor and housing, (2) drive building, (3} snow shed, (4) structures at Con3 (wetland crossing), (5) structures at Con9 (stream crossing), and (6) elevated trestle at the mill. Each component was analyzed as a sepazate facility by scaling the size from the drawings, deterrnining the steps necessary to demolish the structure(s), and an appropriate demolition cost applied. Results and Discussion The detailed calculations, assumptions, and references are attached for each component of the Henderson conveyor system as sepazate appendices. A summary of the demolition cost estimate for each component of the conveyor system is provided in Table 1, and a brief discussion of the individual demolition cost is provided as follows, Conve~r Appurtenances and Housing The conveyor housing system was analyzed as a typical mine structure; that is, its volume was calculated and a factor of $0.13/cu ft was applied to compute the demolition cost. This unit cost was derived from actual experience at Climax Mine's Storke Area, Horizon Mine in New Mexico and Crystal Hill Mine in Saguache County, Colorado. Conveyor demolition occurred at these sites, as a normal part of the overall structural demolition effort (except at Crystal Hill where there were no conveyors used). [Recent conversations with Jeff Mueller of RAG American Coal Company indicated that at Ayrshire Mine in Indiana and Delta Mine in Illinois, they sold two separate lots of conveyor belting and housing for $45,000 (Ayrshire had 300 feet and Delta had about 2500 feet)]. Included in the $0.13/cu ft demolition cost number was the burial of foundations in-place, and no extra cost was added to tear out above grade piers or walls. Costs were based on actual field experience by ASI-RCC of Buena Vista, Colorado (at the Storke Area) and Wayne Gomez Demolition and Excavating of Denver, Colorado (at Horizon Mine). An estimated cost for demolition of the Henderson conveyor housing and appurtenances was computed to be $109,274 for the entire proposed length of 21,533 feet. See Appendix 1. Drive Building The drive building is a large steel structure having a volume of approximately 254,140 cu ft. Applying the $0.13/cu ft unit cost to the drive building volume yields an estimated total demolition cost of $33,038. See Appendix 2.