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MCATEE CONSTRUCTION COMPANY <br />P.O. Box 1908 <br />STERLING, COLORADO 80751 <br />December 3, 2007 <br />Mr. Carl Mount <br />Division of Minerals and Geology <br />Minerals Section <br />1313 Sherman Street Suite 215 <br />Denver, Colorado 80203-2273 <br />Mr. Mount: <br />Re: Annual Report (112) <br />MLR No. M-1986-147, Harley Pit #1 <br />Anniversary Date: 12/02/07 <br />This pit HAS NOT been granted a Temporary Cessation, and it <br />HAS operated more than 180 days this year. The Financial Warranty <br />for this operation is $71,755.00, the permitted area is in Logan <br />County, covers 89.53 ac. ± and the pit is not phased. The bond <br />was reevaluated in May 2007 when 16.02 acres was released from <br />the permit area . As required in Rule 1 . 6 the MINE PERMIT SIGN is at <br />the entrance to the pit and the boundary has been outlined with <br />posts to delineate the Permit Boundary. <br />The annual report requirements in the MLRB Rules and Regula- <br />tions are addressed in the following report. Please refer to the <br />2007 ANNUAL REPORT MAP submitted with this report for areas dis- <br />cussed in this report. <br />(1) We continued to remove material stockpiled last year. An <br />additional 0.86 acres was mined on the southwest side this <br />year (tan). The working face is left as a highwall as <br />allowed in the permit. This face will continue to be worked <br />to the south this year if additional materials are needed. <br />The working floor area where material is stockpiled and <br />processes covers approximately 17.23 acres (~~~ hatch pat- <br />tern) and remains unchanged from last year. <br />(2) Reclamation was completed on 16.02 acres ± in the northern <br />part of the site in 2003 and this area was released from the <br />permit in May 2007. Approximately 1.56 acres +/- has been <br />sloped, resoiled, and seeded in the area (green). Grass has <br />germinated on the seeded area. The seeding has been suc- <br />cessful so we are only monitoring the success at this time. <br />(3) We will continue to removed stockpiled material and mine <br />into the working face on the south side of the mine floor. <br />Stripping will continue on the area south of the mine face. <br />