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STt~TE OF COLOlZADO <br />DIVISION OF RECLAMATION, MINING AND SAFETY <br />Department of Natwal Resources <br />1313 Sherman St., Room 215 <br />Denver, Colorado 80203 <br />Phone: (303) 8663567 <br />FAX: (303) 832-8106 <br />April 20, 2007 <br />Ron Thompson <br />Peak Project Management <br />34115 Co. Road 20.8 <br />Trinidad CO 61082 <br />COLORADO <br />DIVISION O P <br />RECLAMATION <br />MINING <br />- &- <br />SAFETY <br />Bill Ritter, lr. <br />Governor <br />Harris D. Sherman <br />Executive Director <br />Ronald W. Cattany <br />Division Director <br />Natural Resource Trustee <br />RE: 2004-2006 Annual Hydrology Report Review, Lorencito Canyon, #C-96-084 <br />Dear Mr. Thompson: <br />The Division of Minerals and Geology has completed review of the 2004, 2005, and <br />2006 Annual Hydrology Reports (AHR) for the Lorencito Canyon mine. These reports <br />were received June 15, 2006, August 1, 2006, and February 16, 2007, respectively. <br />One issue remains to be resolved from the 2003 AHR review and is repeated below in <br />italics. <br />For future reports, please include the a/evations of the measuring point for each <br />well. Well levels are reported as feet below this measuring point. Data is plotted <br />by elevation above MSL, determined by the elevation of the measuring point. <br />Monitoring Frequency <br />The operator met the approved monitoring frequency in each year. One exception was <br />in 2005 due to the mis-interpretation of when the water monitoring frequency reverted to <br />quarterly rather than semi-annually. However, this isolated excursion from the plan did <br />not result in a significant loss of data, as at least two visits and one water sample were <br />taken at a minimum for each required site. Alluvial wells and surface sites were visited <br />and sampled for water level or flow and field parameters on a quarterly basis once <br />during active operations commenced. Samples were taken for laboratory analysis <br />during the second and fourth quarters as required. Water samples were analyzed for <br />the approved analytical list as required. <br />Water Quantity and Quality <br />March 2001 data, as reported in the 2000 Annual Hydrology Report, is the most <br />representative pre-mine data for the stations currently part of the approved hydrologic <br />monitoring program. Coal bed methane (CBM) development and the associated water <br />Office of Office of <br />Mined Land Reclamation Denver • Grand )unction Durango Active and Inactive Mines <br />