2008-03-03_PERMIT FILE - C2006085 (2)

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• southwest to northeast trending reserve bounded by thin coal to the west, old mine works to the east and seam splits to the northwest and southeast. Encasing stratum of the Ocean Wave seam, both above and below the coal, is sandstone and mudstone (Exhibit N). Overburden stratum at NF-01 in ascending order is alternating sandstone and mudstone for approximately 34 feet, at which point a layer of interbedded siltstone and mudstcne appears for 9 feet. Below the coal .seam is approximately 2 feet of mudstone and over 16 feet of sandstone. Overburden stratum in ascending order at NF-02 is approximately 10 feet of mudstone, 43 feet of interbedded sandstone and siltstone, then alternating siltstone and sandstone for approximately 100 feet. At NF- 03, overburden stratum in ascending order alternating- sandstone and mudstone for approximately 40 feet, 13 feet of interbedded mudstone and sandstone, alternating sandstone and mudstone for 87 feet, then layers of siltstone, sandstone and mudstone for approximately 20 feet. Below the coal seam at NF-03 is alternating layers of sandstone and mudstone for approximately 12 feet and finally 14 feet of interbedded sandstone ~~nd mudstone. Location of Subsurface Water The circulation medium for the exploration coreholes within the mine permit are~~ was compressed air. The return air provided a rapid and reliable indiication of the existence of subsurface water. Minimal perched groundwater reservoirs were encountered during exploration. According to Bishop-Brogden Associates (Exhibit K), water reserves both surface and subsurface, are very minimal in the permit area. The interbedded] siltstone and mudstone act as aquicludes and restrict vertical movement of water. The already arid surface and typically dry stream beds experience surface flow only during local storms and converges with the Arkansas River without allowing significant percolation and recharge. Surface Operations Surface facilities will be located in the SW ~/a of the NW ~/a of Section. 13, between the Chandler Creek dry stream bed and the toe of the Raton mesa in the Vermejo formation with boulder alluvium. Constructic-n of the facility will impact the surface as building construction. Coal seams will not be exposed to the surface except those seams penetrated by the mine portal and shaft which include the Chandler and Royal Gorge coal seams. Drillhole La~ s Drill logs and test boring data are provided in Exhibit N and located on 2.04-13 Revised 6/20/07