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Memorandum in Response to Notice of Determination of Designated Mining <br />Operation (DMO); DRMS File Numbers M-1977-416, M-1978-039 HR, M-1977-285, <br />M-1980-055 HR, M-1981-021 and M-1977-032. <br />On February 8, 2008, Denison Mines (USA) Corp. ("Denison") received Notices of <br />Determination of Designation Mining Operation (DMO) from the State of Colorado <br />Division of Reclamation, Mining and Safety ("the Division") for the following six <br />Colorado Mines: ,{ <br />~~~t~~ <br />• Carnation Mine (M-1977-416) <br />St. Jude Mine (M-1978-039 HR) rv1^.;'~'`t~~; ~~' <br />• Sunday Mine (M-1977-285) ~"~~ =r` ~ 0 1 20Q~ <br />~,-~ <br />• Topaz Mine (M-1980-055 HR) `~~ ~ `=~ C"i~~a,~s:s ---- <br />• West Sunday Mine (M-1981-021) `~-~ ~ ~11iniR~a~tt~~~raf,~~,e <br />• Van 4 Shaft M - 19 9 "~- ~ ~:3j ~ ~~;-, ~ ;,~' <br />_ - ~-~:~- <br />_r. _ ,.T <br />By letters dated March 7, 2008, Denison notifed~the Division under Rule 7;=2~~3,(=1) of the <br />Colorado Mineral Rules and Regulations for HardRock, Metal and Designated Mining <br />,~r~ <br />Operations, that it was not challenging these deterniriations, but that it would proceed to <br />prepare Environmental Protection Plans (EPPs) for each~of.these mines in accordance <br />_..,~~~ <br />with Rule 7.2.3(2). In those letters, Denison also advised~~the;~;~Division that it believed <br />that in the course of preparing such EPPs it may be able to demonstrate that some or all <br />of the mines should be considered to be exempt~f~rom~the EPP requirements under Rule <br />1.1(14)(e) or Rule 7.2.6(1)% -- - ~a~=~' <br />FL ~ r~~Er~ L " .~ ~ y f., ~. <br />Three of these mines,~the Carnation, St Jude and Van 4, are currently permitted as <br />limited impact operat ns (110 permits), while the;remaining three, the Sunday, Topaz <br />~-::= <br />and West Sunday, are currently~permrtted as Regular Operations (112 permits). As the <br />Division has indicated that~the DMOFRuIes could be applied differently to 110 permits <br />relative to~~112 permits~~we address each type of permit separately. <br />i~~- ;~~ ~~ ~ ~~ <br />110,-PE12MITS ~~;~° <br />~.., <br />Under Rule=la 1(14)(e), metaloperations, permitted under Section 34-32-110, C.R.S. <br />1984, as amended;which do~not use or store designated chemicals, are exempt from the <br />requirements applcable;sto-~DMOs unless they have a potential to produce acid mine <br />drainage in quantitieszsifficient to adversely affect any person, property or the <br />environment. Ifthe-operator can demonstrate to the satisfaction of the Division that the <br />requirements of Rule 1.1(14)(e) are satisfied, then it will not be necessary to prepare an <br />EPP for the mine. <br />Denison believes it will be able to make this demonstration with respect to the Carnation, <br />St. Jude and Van 4 mines, and proposes, as the first step in preparing the EPPs for those <br />mines, to conduct sampling and tests aimed at making that demonstration. If after review <br />of the results of these tests Denison has not demonstrated to the Division that the <br />exemption in Rule 1.1(14)(e) is applicable to any of these mines, Denison will continue <br />with the preparation of an EPP for each of the mines. <br />