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STATE OF COLORADO <br />DIVISION OF RECLAMATION, MINING AND SAFETY <br />Department of Natural Resources <br />1313 Sherman St., Room 215 <br />Denver, Colorado 80203 <br />Phone: (303) 866-3567 <br />FAX: (303) 832-8106 <br />May 2, 2008 <br />First Southern National Bank <br />99 Lancaster Street <br />P.O. Box 328 <br />Stanford, KY 40484 <br />Re: Lorencito Canyon Mine (Permit No. C-1996-084) <br />Bond Release Application No. 2 (SL-2) <br />Bond No. 11 <br />Dear Sir or Madam: <br />COLORADO <br />DIVISION O F <br />RECLAMATION <br />MINING <br />- &- <br />SAF ETY <br />Bill Ritter, Jr. <br />Governor <br />Harris D. Sherman <br />Executive Director <br />Ronald W. Cattany <br />Division Director <br />Natural Resource Trustee <br />This letter, as required by Rule 3.03.2(5)(a) of the Rules and Regulations, is to inform you that the <br />Division of Reclamation, Mining and Safety has issued a proposed decision to Approve Bond Release <br />Application No. 2 for the Lorencito Canyon Mine. This decision will be published in the The <br />Chronicle -News as soon as possible. Publication of the notice initiates a thirty (30) day public <br />comment period. If, within thirty days, there are no requests for an adjudicatory hearing, the decision <br />will become final. <br />The bond for the operation is a Letter Of Credit issued by your company (Bond No. 11), in the amount <br />of $975,000.00. The proposed release amount is $50,952.00. <br />Please be aware that this notification is not a request to initiate any action by First Southern <br />National Bank concerning Bond No. 11, and is for your information only. Should Lorencito Coal <br />Company, LLC chose to take action with regard to this bond release, they will contact you. <br />If you have questions or need additional information, please contact me. <br />Sincerely, <br />Kent A. Gorham <br />Environmental Protection Specialist <br />cc: Johanna R. Cramer, CDMG <br />C-SL-17 01996084 KAG 0502200809495? doc <br />Office of <br />Office of <br />Mined Land Reclamation Denver Grand Junction Durango AftiVe and Inartiva Minr c <br />