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quantities of useable subsurface water. To date, there have been no •I wells developed within the permit area. The stratigraphy of the permit area is highly lenticular, with lenses of sandstone, siltstone, and shales. The coal seams appear to be the most continuous units found within the permit area, although the seams sometimes split and thin or thicken which indicates general inconsistency and lenticular nature of the stratigraphy. Peerless Resources, Inc. believes that some small portion of the surface water that does not runoff probably percolates into the underlying strata and is discharged into the abandoned workings of the old mining operations found in the area. As evidenced over the past several years, water is discharged from the old workings during spring runoff, but the water discharge stops or is reduced greatly during late summer and fall. This fact would indicate that only relatively minor amounts of subsurface water are found within the permit area and this amount is influenced by seasonal fluctuations. In addition, given the lenticular stratigraphy of the permit area, Peerless Resources, Inc. would expect that small perched water zones could also be found within the permit area. As stated above, the majority of wells found within the vicinity of the Coal Gulch Mine are located along Lightner Creek north of the permit area. Lightner Creek colluvium and underlying saturated strata are well beneath the coal to be mined by Peerless Resources, Inc. as shown on Figure IA, Typical Cross Section of the General Area. In addition, the colluvium found in Lightner Creek is well up-dip from the planned mining. Mining will have no effect on the wells in Lightner Creek. 5. The drill logs in Exhibit 7 indicate coal present other than the coal in the C' and A' seams. Rider seams and other major seams 'B seam shou be ad resse No water evels were shown with -14-