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(Page 2) <br />MINE ID # OR PROSPECTING ID # M-1997-086 <br />INSPECTION DATE 03/24/2008 <br />OBSERVATIONS <br />INSPECTOR'S INITIALS DEZ <br />This inspection of Permit Number M-1997-086 (Bedrock Mine #1) was conducted by Deb E. Zack of the DRMS as a result of a <br />citizen complaint. Matt and Brad Mueller of Siloam Stone, Inc. were present during this inspection. The pit is located <br />approximately 2.75 miles east and 6.5 miles north of Beulah, CO on Siloam Road and currently consists of approximately 329.7 <br />acres where approximately 23.4 acres are being utilized as stoneyard stockpile and processing area. According to the <br />provisions of the approved permit application, the Division considers this area to be excluded from the 20-acre maximum <br />mining disturbance requirement (enclosed). According to the approved application "The stoneyard on this site is used by Siloam <br />Stone as a place where clients can be brought to view available products, and as a place to store the stone after it has been <br />mined. It is not included in the bond calculation or the limited disturbance area because it also accepts stone material we <br />[Siloam Stone] purchased from other mining operations in the area. This stoneyard will remain when mining is complete so it is <br />reclaimed as its intended end use now." <br />The Division does consider the 8.2 acres currently determined to be "actively mined", 3.5 acres of topsoil and clay stockpile, <br />and 8.2 acres of partially reclaimed land (totaling 19.9 acres) to fall into the required 20-acre maximum. <br />Starr Mitchell is the stated owner of approximately 83 acres of the current permit area, submitted a letter to the Division on <br />March 7, 2008 (enclosed in its entirety) with the following concerns, which fall under the Division's jurisdictional authority: <br />"This letter is to request an inspection due to our belief that Siloam Stone is out of compliance on the 160 acre <br />grandfathered mining lease in Pueblo County. As property owners of a portion of the 160 acres, we feel that Siloam <br />Stone is mining more than to 20 acres at any one time than is allowed. We also feel that they are not reclaiming the <br />amount of acreage required in that 20 acre mine." <br />This inspection included a GPS survey of this site and the two other surrounding separate mine operations -one 6.3 acre <br />110(c) (Siloam Stone's Pinon Mine -permit number M-1997-094) and Robinson Brick's 9.9 acre 110(2) clay mine (Siloam <br />Mine, permit number M-1977-326). The findings of this GPS survey are also enclosed and overlay the most recent aerial <br />photograph in the Division's possession. <br />As a result of this inspection the Division will be recalculating the bond required for this site. This bond calculation (probable <br />surety increase) will be sent to the Operator under separate cover. <br />Other than the pending bond recalculation, the Division has no outstanding concerns with this site. All activities and completed <br />work at the time of inspection appeared to follow the guidelines and regulations set forth by the state and the mining and <br />reclamation plans for the pit, and no problems are noted for this site. The site is stable, and no disturbance was observed <br />outside of the approved permit boundaries. <br />Responses to this inspection report should be directed to Deb E. Zack at the Division of Reclamation, Mining and Safety, <br />Denver Office, 1313 Sherman Street, Room 215, Denver, Colorado 80203, phone number 303-866-4179. <br />I & E Contact Address cc: ^ CE <br />NAME Mr. Matt Mueller ^ BL <br />OPERATOR Siloam Stone, Inc. ^ FS <br />STREET 315 N. 7t" Street ^ H~/ <br />CITY/STATE/ZIP Carion City, CO 81212 ^ HMWMD (CH) <br />^ SE <br />^ WOCD (CH) <br />X OTHER <br />cc: Starr Mitchell, 3607 S. Jane Circle, West Valley City, Utah 84120 <br />MR. STEVAN O'BRIAN, ENVIRONMENT, INC., 7985 VANCE DR STE 205A, ARVADA, CO 80003 <br />Tony Waldron, DRMS via a-mail <br />