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Bowie Resources Limited Bowie No. 2 Mine 1999 Annual Hydrology Report Introduction The Bowie No. 2 Mine was built arrd opened by Bowie Resources Limited during the spring and summer months of 1997 with coal production/development beginning on August 15, 1997. This room and pillar operation is developing a main and submain system of underground entries that will provide the ventilation, haulage and coal conveyor support for years to come. These entries are driven carefully on projections, held to minimum widths with larger than normal coal pillars left in place to assure adequate support for the life of the mine. The mine began longwall production during November 1999. The following 1999 Annual Hydrology Report describes the hydrologic monitoring for surface and ground water within the pemtit and adjacent area of the Bowie No. 2 Mine and presents baseline data for a permit expansion. This expansion will be necessary when Bowie Resources Limited acquires the Federal coal immediately north of the currently permitted private coal lands associated with this mine. In [his report, springs, ponds and streams (including ditches, rivers, and canals) are considered surface water. Alluvial wells and drill holes are sampled and analyzed as ground water. Please refer to the permit application for a discussion of the methods employed during [he gathering of • field parameters. Permit Map-09 (attached as an exhibit in [his report) indicates the location of all monitoring points referred to in this report. At the request of the Division, we have included baseline data for all Springs, Streams, Drill Holes and Alluvial Wells on the annual tabulation figures. Table 1 (immediately following this narrative) defines the monitoring points by type and sample frequency, field parameter sampling schedule and laboratory parameter sampling schedule. Table 2 contains a listing of the laboratory parameters for surface and ground water to be tested in accordance with the mining permit application. Laboratory analysis is performed by ACZ Laboratories, Inc., 2773 Downhill Drive, Steamboat Springs, CO 80487. Table 3 contains a listing of the field parameters and their application [o the Springs, Streams, Drill Holes and Ponds within the permit boundary. Flow readings for springs and small streams are reported in gallons per minute. Stream and river flows are reported in cubic feet per second. Table 4 contains a listing of all monitoring points, with descriptions of their locations and a reference [o the Monitoring Point Table that contains this year's monitoring data. All Drill Holes and Wells, with the exception of AW-2, 7-10, have charts which present current and historic monitoring data. DH-13 and DH-346 were eliminated by mining during 1999. No Ponds have charts. Springs and streams with flows in excess of 5 gallons per minute and adequate historical data have charts included. Page 1