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Bowie Resources Limited Bowie No. 2 Mine _ 1998 Annual Hydrology Report • Run-off from the topsoil and coverfill stockpile is directed to ditch D-F2. The sample point for these SAE areas is ditch D-F2 beyond and to the east of the coverfill stockpile. Run-off from the entrance to the mine property is directed through roadside ditches to culverts crossing under Oki Highway 133. The sample point for this SAE is the outlets ofthese culverts. No samples were obtained from any of the SAE's during the yeaz. Coal Member of Mesaverde Nine drill holes were monitored during the 1998 sampling season. These holes were monitored quarterly for field parameters and semi-annually for full suite laboratory analysis. Data collected and evaluated is consistent with the baseline information provided in the permit application. The mine construction work during 1997 required the elimination of four monitored drill holes. These holes are DH 42, DH 52, DH 54 and DH 55 and were located neaz the mine portals. Drill Holes DH4-57 and DH4-57A were added in conjunction with the Terror Creek Coal Exploration Plan, with monitoring beginning in September, 1998 but inaccessable in December. Although field parameters have been recorded, they aze not reported in anticpation of specific survey data for these holes. . Conclusion The resuhs of the hydrologic monitoring conducted during the 1998 season indicate consistent chemical and physical properties when compazed with the baseline values provided in the permit application. Mining at the Bowie No. 2 mine is in the early stages with minimal extraction ratios employed to insure the longevity ofthe underground coal production systems. These mining methods have protected the local hydrology during the current yeaz. Underground development issues will again be the focus of 1999 mining and aze not expected to adversely impact the local hydrology. Water quality at all monitored sites remains good overall and no chemical or physical impacts have been noted. None of the field or laboratory parameter results indicate or suggest an adverse impact associated with the mining operations of the Bowie No. 2 Mine on the local hydrology. Pape 4