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Memo to Berhan Keffelew 2 October 10, 2008 <br />Third Mine Pit Review Permit No. M-1980-244, AM-09 <br />Schist Island Pits. Even if CC&V were to commit to limiting themselves to no more than one unreclaimed <br />production lift per pit as discussed above, this represents potentially 759,500 square feet of production face that <br />would have to be specially blasted and scaled, with blast and scaling rubble removed to overburden storage areas, if <br />the bond were to forfeit in 2015. The cost for this amount of reclamation work would be substantial. In that same <br />year the ore heap and waste dumps will be approaching their maximum footprints and all mining and processing <br />facilities will be in operation. Under these circumstances and at this point in life of the mine, there does not appear <br />to be much if any excess bond available to complete the necessary and under the current cost estimate unbonded pit <br />wall work. CC&V must either provide a demonstration of which line item reclamation tasks in the current cost <br />estimate will not be required at this and other critical points in the execution of the mine plan, and a demonstration <br />that the sum of those savings will cover pit wall reclamation at each of those time points, or must provide sufficient <br />additional bond for the pit wall work. DRMS recognizes that CC&V will be doing concurrent reclamation during <br />execution of the mine plan. However, the completion of concurrent reclamation cannot be used as a credit against <br />future reclamation costs in the bonding to be required through AM-09 permitting as the only way to credit against a <br />bond for reclamation completed by the process described in Rule 4.14 of the Mineral Rules and Regulations for <br />Hard Rock, Metal, and Designated Mining Operations. <br />cAacs files\My Documents 4-19-06 thru\cresson am9 mine slope review 3.doc