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' STEEPEN ROBEP TSON 8 KIR$TEN <br />' Mr. Gary Dodson <br />Battle Mountain Gold Company <br />November 23, 1988 <br />Page Three <br />' Determine the slakability of the materials and identify whether the <br />cause is due to overcoming negative pore water pressures and/or due <br />' to the clay mineralogy of the material. This allows an evaluation <br />of the rate of slope deterioration due to slaking; and <br />' Determine the shear strength characteristics fora saturated sample. <br />This will enable design curves to be established for the south wall <br />of the west pit assuming that the Santa Fe Formation will be <br />' saturated. <br />For cost estimating purposed we have assumed that the laboratory program <br />will include four permeability tests, ten dry density/moisture content tests, <br />' two slake tests and two sets cf three shear strength tests. <br />SRK proposes to prepare a report describing the completed program for <br />' submittal to BMG. The report will be submitted initially in draft form far review <br />by BMG. Following review the report will be finalized and then resubmitted. <br />Included in the report will be all lithologic logs and laboratory test results. <br />' Cost Estimate <br />We estimate that SRK's proposed field exploration and laboratory testing <br />' programs can be completed for 514,615 to 516,575, representing the range for <br />three to six coreholes. These figures assume that a geotechnical corehole can <br />be completed in one day and that a geotechnical/hydrogeologic corehole can be <br />' ~ completed in a day and a half. The cost figures do not include any drilling <br />contractor charges as we understand that BMG will handle these directly. Charges <br />associated with the hydrogeologic testing and piezometer installation are also <br />not included as we understand that Halepaska will submit a cost estimate for <br />' these separately. SRK's total charges include 510,490 to 512,110 for professional <br />fees, 52,265 to 52,565 for reimiursable expenses and 51,900 for laboratory <br />testing. <br />' Schedule and Personnel <br />We understand that BMG is prepared to mobilize the drilling contractor and <br />' start coring immediately following the weekend after Thanksgiviwg. SRK is <br />prepared to mobilize all appropriate personnel at that time. We anticipate <br />mobilizing a field geologist to observe the coring, collect the cores and <br />' classify them. The field geologist will be onsite for the duration of the <br />program. We also anticipate mobilizing a pit wall/rock mechanics specialist to <br />the site for two days at the start of the program. <br />' SRK anticipates that the field exploration program can be compl?ted in one <br />to two weeks and that the laboratory testing program can be completed in another <br />two weeks. Preparation of a draft report will require approximately one week and <br />1 <br />1 <br />