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<br />INTRODOCTION <br />The Fruita #1 Mine was started by a group called Coal Mining <br />Partners in 1977. The mine was located in the Cameo Seam north of <br />Fruita, Colorado. Due to poor market conditions, the mine was <br />placed in temporary cessation in 1978. Also in 1978, Dorchester <br />Coal Company took over the property and submitted a permit <br />application for a large mining complex on the site. The Fruita #2 <br />Mine, in the lower Anchor Seam, went into operation in mid-1978 <br />and was placed in temporary cessation in 1980. <br />The Fruita #1 Mine was kept idle until 1983 when a fire developed <br />in the mine entries from spontaneous combustion. The portal area <br />was immediately sealed and the portal bench area was partially <br />backfilled, topsoiled and reseeded. This was done in 1984 and <br />1985. The Fruita #2 Mine was kept idle throughout this period. <br />In 1984, Dorchester Coal's parent company, Dorchester Gas <br />Company, was purchased by Damsen Oil Corporation. Damsen <br />converted Dorchester Gas Company into the Dorchester Limited <br />Partnership. DMLP retained control of Dorchester Ccal Company. <br />In 1986, Arabian Shield Development Company purchased the stock <br />of Dorchester Coal Company from DMLP. Shortly thereafter, the <br />name of Dorchester Coal Company was changed to American Shield <br />Coal Company. <br />In the fall of 1988, American Shield quit claimed its interest in <br />all coal and surface leases to Alfred E. Hoyl and Donald E. <br />Wilde. American Shield has no interest in the property other than <br />its reclamation responsibility. <br />A number of permit applications have been submitted on the <br />property since the late 1970's, however, none were completely <br />finalized. <br />In November of 1989, American Shield submitted a reclamation-only <br />permit application for both mines. This plan was approved by the <br />Division but a permit number was never issued by the Division. <br />During the fall and winter of 1990, American Shield performed the <br />reclamation of both sites according to the approved plan. After <br />inspection by the Division, a Phase 1 bond release was granted, <br />thereby reducing the bond from 590,000 to 536,000. <br />_~ <br />