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• I Panel. Advancement of `I' Panel began in June of 1996 and extended for a distance of approximately 2,650 feet. No retreat mining was done in `I' Panel. Roof seeps and floor seeps were encountered in the panel however, these seeps were similar to previous inflows and only flowed for short durations. Mining_Projsctions: Mining projections for 1997 will primarily be located in the lower leaf of the `D' seam in the Central Pod. This will include the advance mining of Panel's, III West, `I' Extension, 1 North, 2 North, 1 South, 2 South, and II West Alternate. Mine Inn°w: The mine inflow study at the Bowie No. 1 Mine was conducted during July, 1996. Panels 2 '/z and `I' were being advanced during the time of the study. Minor inflows were encountered during advancement of each section and would essentially cease within one to four weeks after interception by mine workings. Seeps • continued to exhibit the same characteristic patterns expected when mine workings intercepted perched aquifers. Seeps encountered during the past year failed to produce even moderate flow (>1 gpm) for any significant periods of time. No water was discharged from the mine to the surface during the 1995 - 1996 reporting period. The operator has no plans to discharge water from within the mine to the surface during the 1996 - 1997 reporting period. No water has been discharged from the mine to date. The northern end of the South III Submains remains available to hold excess water which may be encountered although this is not anticipated based upon the patterns of inflow established thus far. Water ImRrtation and Balance: Approximately 548,009 tons of coal was produced from the Bowie No. 1 Mine from July 1, 1995 through June 30, 1996. Production estimates for the following twelve month period call for approximately 750,000 tons of coal to be mined. Page -3-