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Introduction According to Stipulation No. 29, Permit No. C-1981-038, the operator submits the following Annual Mine Inflow Report for the period of July 1, 2005 through June 30, 2006. Mining Locations and Projections Mining operations at Bowie No. 1 Mine have ceased due to market conditions and coal quality issues. It is highly unlikely mining operations will resume. Mine Inflow The underground Mine Inflow Study at the Bowie No. 1 Mine was not conducted during 2006, as the mine was inactive and inaccessible. No water was discharged from the mine to the surface during the 2005-2006 reporting period. The operator has no plans to discharge water from within the mine to the surface during the 2006-2007 reporting period. No water has been discharged from the mine to date. Water Importation and Balance There was no production of coal from the Bowie No. 1 Mine from July 1, 2005 through June 30, 2006. Production estimates for the following twelve month period remain at zero. Historically, mine water importation is estimated from recorded flows and the number on tons mined. With no coal production to base water usage upon, the operator submits only evaporative loss from ponds for the consumptive use during the water year. Evaporative loss is based upon the assumption that all of the ponds have full dead pool storage during the entire reporting period. These water quantities are listed as: Acre Feet Dust Suppression on Bowie No. 1 Roadway' ............................................................................0.00 Bathhouse Consumptionz ...........................................................................................................0.00 Evaporative Loss from Ponds .....................................................................................................4.60 Silo Usaae ...................................................................................................................................0.00 Total water usage 4.60 Hydrologic Impacts Historically, there was virtually no water inflow into the mine, Therefore, the hydrologic impact caused by fhe mining operation is either non-existent or not measurable. Conclusions No mine discharge and minimal importation of water is anticipated during the 2006-2007 reporting period. Therefore, the quality and quantity of surface water adjacent to the mine will not be affected. The operator will continue to submit the Annual Subsidence and Hydrology Report which will summarize all subsidence and hydrology data. 'No or minimal consumption ~, zBathhouse has been dismantled.