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<br />Gypsum ore reserves in the existing mining operation are now estimated at <br />approximately 5 years. This estimate assumes that market conditions and the demand for <br />gypsum wallboard will allow for full production capacity at the wallboard plant. <br />Anything less than full market demand will prolong existing reserves but additional <br />gypsum reserves must be ready for full production, prior the exhaustion of reserves at the <br />existing mine site. <br />The amended site is located entirely within BLM land and on mining claims held <br />in accordance with the Mining Law of 1872. The process for amending the company's <br />BLM Plan of Operations for the operational transition has been completed. BLM <br />procedure required conformance with the National Environmental Policy Act (NEPA) <br />and all other associated BLM statutes and regulations. In particular, the NEPA process <br />required preparation and approval of an Environmental Assessment (EA). The EA <br />documented all environmental impacts related to the amended site, as well as all <br />mitigation measures that will be implemented. A copy of the EA is attached for <br />appropriate referral party reference and is also available at the Eagle County Planning <br />Department. A Copy of BLM permit approval (FONSUDecision of Record) is included <br />as Exhibit A.. <br />Another phase of approval for operational relocation involved amendment of <br />American Gypsum's permitting and performance bonding with DMG as prescribed by <br />Colorado statutes. The DMG process included review of the mine and reclamation plan <br />and also addressed issues such as stability of mine/reclamation slopes, storm water <br />management, dust abatement, road and drainage design and overall erosion control. DMG <br />specifically reviewed the proposed mine reclamation plan under it's authority with the <br />Colorado Mined Land Reclamation Act (CMLRA). DMG found the plan to be in <br />accordance with the standazds of state law. <br />A copy of DMG Permit Amendment Approval Letter (Exhibit A-1) is attached. <br />Under state law the Colorado Mined Land Reclamation Board (MI;RB) exercises <br />authority over reclamation bonding requirements for mining operations. In accordance <br />with the MLRB (2-2-02) Board Order, bonding must be in place before any development <br />activity begins in the amended area. American Gypsum Company will post bonding prior <br />to any development. A copy of the Board Order describing this requirement is attached as <br />Exhibit A-2. <br />SchedulinE <br />. Planning and permitting amendments have been initiated well in advance of the <br />required period to accommodate long-range business planning. American Gypsum <br />anticipates construction of the 1.2-mile haul road to the amended site may require at least <br />3 years to complete. This is due to the fact that the road will be constructed from fill <br />material (non-gypsum rock), as it becomes available from the ongoing mining operation, <br />Fill material will be used as much as possible to minimize road cuts and escarpments. <br />3 <br />