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i <br />III I IIIIII III <br />STATE OF COLvtctiliU <br />MINED LAND RECLAMATION DIVISION <br />Department of Natural Resources <br />1313 Sherman St., Room 215 <br />Denver, CO 80203 <br />303 866-3567 <br />RAx: 303 832-8106 <br />OF CO[p <br />-~1; g <br />. ~~` <br />Y <br />~ /876 ~ <br />Roy Romer, <br />Govamor <br />Frao R. Banta, <br />Division Director <br />May 30 , 1991 <br />Kathleen G. Welt <br />Env ironmen tal Engineer <br />Mountain Coal Co. -West Elk Mine <br />P.O. Box 591 <br />Somerset, CO 81434 <br />Re: Hawk's Nest Silos and Adjoining Ground Storage <br />Dear Ms. Wel t: <br />This letter is in response to your correspondence of April 29, 1991 regarding <br />future use of the Hawk's Nest Mine Coal Silo Facility situated near the West <br />Elk Mine. I have discussed the questions contained in your letter with the <br />Coal Supervisor and cur Attorney Generals Office representative and forward <br />the following comments for your consideration, <br />Regarding the issue of performance bond liability for reclamation of the silo <br />facility should WECC arrange to utilize the silos, it is the Division's <br />posi tion that only three scenarios are possibl e: <br />1, WECC revises their permit to add the silo facility to their <br />existing mining operation and provides the necessary performance <br />bond to cover reclamation of the silo facility; <br />2. The Denver & Rio Grande Western Railroad obtains a permit from the <br />Division to activate the silos and provide the necessary bond <br />coverage to the Division; <br />3. The Division uses the existing bond money forfeited by the previous <br />operator of the Hawk's Nest Mine to demolish the silos and complete <br />final reclamation of the site as required by the revoked permit. <br />The first scenario appears to be the most plausible means of allowing future <br />use of the silo facility by WECC. Although the railroad could also permit the <br />silos, it is probable that any costs to the railroad for permitting, <br />maintaining, and binding the facility would simply be passed on to WECC as <br />part of the lease fees. The third scenario may create a substantial legal <br />conflict beUveen the railroad and the Division based on the railroad's statLs <br />as neM owner of the facility and their staled plans to make use of the silos, <br />