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. Bowie Resources Limited May 12, 2003 <br />Bowie No. 2 Mine <br />Annual Hydrology Report <br />Coal Member of Mesaverde <br />Fifteen drill holes were monitored during the 2001 sampling season. These holes were monitored <br />quarterly for field parameters and semi-annually for full suite laboratory analysis. Data collected <br />and evaluated is consistent with the baseline information provided in the permit application. The <br />mine construction work during 1997 required the elimination of four monitored drill holes. These <br />holes are DH 42, DH 52, DH 54 and DH 55 and were located neaz the mine portals. Drill Holes <br />DH-13 and DH-34b were eliminated by mining. Drill Holes DH-57, 57a and DH-58, 58a were <br />added in conjunction with the Terror Creek Coal Exploration Plan, with monitoring beginning in <br />the fall of 1999. Drill holes DH-57 and DH57a were destroyed by longwall mining during 2001. <br />Drill holes DH-65, DH-66, DH-67D, DH-67b1w and DH-67abv were added in conjunction with <br />the Ironpoint Federal coal lease, with some monitoring beginning during the fall of 2000, but <br />interrupted during 2001 by the denial of access by the USDA-Forest Service. <br />Conclusion <br />The results of the hydrologic monitoring conducted during the 2002 season indicate consistent <br />chemical and physical properties when compared with the baseline values provided in the permit <br />application. Mining methods at the Bowie No. 2 mine have made a transition from room and <br />pillar entry development (with minimal extraction ratios employed to insure the longevity of the <br />• underground coal production systems) to longwall mining methods. This mining method has <br />• <br />protected the local hydrology during the current yeaz. Longwall mining is now the focus of all <br />mining operations at Bowie No. 2 Mine. Water quality at all monitored sites remains good overall <br />and no chemical or physical impacts have been noted. None of the field or laboratory pazameter <br />results indicate an adverse impact associated with the mining operations of the Bowie No. 2 Mine <br />on the local hydrology. <br />