2008-01-10_REVISION - M1990057

• Permit No: M1990057
• IBM Index Class Name: Revision
• Doc Date: 1/10/2008
• Doc Name: Re-sent FW increase
• From: DRMS
• To: Capital Gold Corporation
• Type & Sequence: SI3
• Email Name: ECS
• Media Type: D
• Archive: No

STATE OF COLORADO
DIVISION OF RECLAMATION, MINING AND SAFETY •??
Department of Natural Resources n C/'
1313 Sherman St., Room 215 ?/ Jv
Denver, Colorado 80203
Phone: [phone] ?/-
FAX: [phone] f ,
November 27, 200"' a Q`l b n (/10/66
Mr. J. Sco azlit
Leadvi ining & Milling C'uP;-? ( GI d C o ?-
PO x 552 (?(?' (?,v l Jr6
adville, CO 80461 'tGt2/' ctf t
Co UQ 120
Q
RE: Hopemore Shaft; Permit No. M-1990-057A--
Leadville Mining and Milling; Financial Warranty Increase (SI-03)
Dear Mr. Hazlit,
COLORADO
D I V IS I ON OF
RECLAMATION
MINING
SAFETY
Bill Ritter, Jr.
Governor
Harris D. Sherman
Executive Director
Ronald W. Cattany
Division Director
Natural Resource Trustee
On August 8, 2007, the Division of Reclamation, Mining and Safety conducted inspections of the Hopemore Shaft
and Mill Site, Permit No. M-1990-057. The Division is required to hold a financial warranty to ensure the
reclamation plan can be achieved. If Gallenstein & Associates, Inc. does not have the appropriate water rights in
place, the reclamation plan cannot be achieved and an alternate reclamation plan is required. Without such plans,
the Division is required to adjust the financial warranty to backfill the gravel pit two feet above the maximum
ground water elevation.
According to Rule 4.2.1(1) and (2), the Division may review a financial warranty at any time to determine if the
amount is sufficient to perform reclamation. The Division recalculated the bond to factor in 2007 equipment and
labor rates and reclaim the site to achieve the approved postmining land use. The result of the recalculation
indicates that the site is currently under bonded. This letter is to inform you that your financial warranty will need
to be revised from its current amount of $35,550.00 to $81,700.00 within 60 days of receipt of this letter. To break
it down further, the cost to reclaim the Hopemore Shaft site is approximately $30,000.00 and the Mill site is
approximately $51,700.00. A copy of calculations used to determine this cost is attached for your review. The
operator has three options regarding the amount of required bond;
1. submit additional financial warranty in the amount of $46,150.00,
2. perform some reclamation on the site to reduce the reclamation liability, or
3. revise the reclamation plan.
One of the three options, or a combination thereof, must be completed by February 1, 2008. Failure to do so may
be considered a violation of the Hard Rock Rules and Regulations. If you have any questions about this process or
how the bond was calculated, please contact me at [phone].
ncceerrelly,
E60 ?6
rica S. rosby
Environmental Protection Spe alist
cc: Carl Mount; DRMS
Elizabeth Taliaferro; DRMS
Bob Calder; Lockland LLC w/enclosure
Enclosure(s); DRMS Reclamation Cost Estimate
Certified A4ai4 #-780.3-1-689 A408-b429-6053
First Attempt Resturned to Sender on 1/4/08
Second Attempt sent on 1/10/08 via CERTIFIED MAIL NO-7003 1680 0000 64228153
Office of office of
Mined Land Reclamation Denver • Grand [unction • Duran¢n --"- ""°