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8 miles to the west. Coal will then be washed in the prep plant and loaded onto unit trains for transportation to market." The original plan was for underground operations to begin in the P3 portal in Cow Canyon. This coal mined by underground methods would require washing in the preparation plant at the New Elk site. Therefore, at some point after DMG began review of the initial application in mid January 1997 and the initial approval of the Lorencito mining operation in November 1997, the New Elk mine site became part of the overall mining plan related to operations at Lorencito Canyon. In this case, the Lorencito operation did not begin operations immediately upon approval for reasons unknown. Once an operation is approved and an appropriate reclamation performance bond is accepted by DMG, there is no requirement that it begin operations immediately. The mine may begin approved operations at any time after approval. However, Rule 2.01.5(2)(a) requires a permit "terminate if the permittee has not commenced the surface coal mining and reclamation operations covered by the permit within three years of the date of the issuance of the permit." The DMG inspection reports document that operations continued in temporary cessation at the New Elk mine awaiting coal production from the Lorencito operation. During temporary cessation, the mine continues to be bound by the mining permit issued by the DMG, as well as any other requirements of State water discharge permits (CDPS), air permits, etc. The New Elk site remained in temporary cessation until a letter was received on October 18, 2001 notifying the DMG that operations would resume. This resumption of operations was anticipated based on a permit revision (PR- 01)filed by Lorencito Coal Company and received by the DMG on May 4, 2001. The DMG is authorized to extend the three-year period if circumstances exist beyond the control of the applicant. Based on information reviewed by the DMG, the period was extended for six months (till May 7, 2001) for the applicant to file a revised mine plan under PR-01. Sections 2.04 and 2.05 of the approved New Elk permit application contain information related to water quality, quantity, and planned uses. I have enclosed portions of section 2.05 for your review related to the operations plan. The operator is required to keep a complete copy of the permit application on file in the vicinity of the mine for public review. If you would like to review the New Elk permit application in more detail, please contact Ron Thompson of Peak Project Management at (719) 846-4975 or call me at the DMG. If you need more information or have any questions, please call me. Since Kent A. Gorham Environmental Protection Specialist II Enclosures (13 pages)