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MINE ID # OR PROSPECTING ID #: -M-9008-017 <br />INSPECTION DATE: 07/30.49n0g INSPECTOR=S INITIALS: MAC' <br />OBSERVATIONS <br />The inspection of the Derr Pit was conducted by Michael Cunningham of DRMS, Tony Waldron of DRMS, Eric Scoff <br />of DRMS, and Darwin Derr of Broken Arrow Investments, I.I.C. The Derr Pit is located one mile east of Greeley in <br />Weld County, Colorado. <br />The inspection was a routine preoperational inspection of a 112 permit. The public notice was posted at the <br />mine site entrance. The permit area lies a quarter of a mile north of State Highway 263; Balsam Avenue runs <br />along the west side of the site. There is a permitted mine site on the west side of Balsam Avenue; the property to <br />the north, east, and south of the site is private and used for agriculture. The proposed permit area encompasses <br />39.19 acres and the affected area is approximately 31.85 acres. The deposit at this location consists of sand and <br />gravel that will be used for road base. The pit will be mined to a depth of approximately 85 feet. <br />At present the site is being used as a staging area for Mr. Derr's business, Dust & Dirt Excavating I.I.C. In addition <br />to construction equipment, topsoil stockpiles are also being stored on the site. There were also several shallow <br />depressions on the site that were being used to dry drill mud. The site was sparsely vegetated and consisted <br />primarily of kochia. The reclamation plan calls for reclaiming the area to be used as a developed water <br />resource. The mining plan calls for a phased approach, with a slurry wall installation after the first phase of <br />mining. The first phase will consist of mining the entire affected area to a depth of six feet, after which the slurry <br />wall will be constructed before moving on to the next phase. <br />There are a number of structures that are within 200 feet of the permit boundary. As mentioned above, there is a <br />permitted mine site to the west of the property as well as a county road. In addition, there is an underground <br />water line, an overhead electric line, and a gas line that parallel the western permit boundary. An existing gas <br />well is located at the center of the pit along with a tank battery located near the entrance to the site. The mining <br />plan calls for a minimum 150 foot setback from all existing oil and gas structures. Several residential structures <br />are nearby: there is an uninhabited shack off the northeast corner of the property and a house with a domestic <br />well off the southwest corner of the property. Mr. Derr has installed peizometers around the permit boundary and <br />has begun collecting data on the water table elevations at this location. <br />This concluded the inspection.