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RULE 3 PERFORMANCE BOND REQUIREMENTS
<br />At the time of the TR-43 submittal, Colowyo did not submit a rider to the bonds noted above to reduce
<br />the $20,000,000 bond amount held by the Division. Colowyo subsequently provided the Division with a
<br />reduced performance bond reflecting the revised calculated liability plus an appropriate contingency for
<br />future liability increases. With modification of Bond #14-95-65, total bond liability was the $15,670,521,
<br />noted above, and total bond liability coverage was $16,000,000, resulting in a contingency amount of
<br />$329,479.
<br />In 1999, Colowyo submitted TR-49, which allowed for a modification to the West Pit disturbance area.
<br />The TR-49 modifications added $31,876 to the previously calculated bond liability of $15,670,521, for a
<br />total calculated liability of $15,702,397, leaving a remaining contingency of $297,603.
<br />In 2001, Colowyo submitted TR-50, which transferred the bond surety for exploration activities from the
<br />mine bond to an exploration bond. The TR-50 revision reduced the mine reclamation liability by
<br />$30,823, resulting in a total calculated mine reclamation liability of $15,671,574 and a remaining
<br />contingency of $328,426, based on bond liability coverage of $16,000,000.
<br />In 2001, Colowyo also submitted TR-53, which extended mining into Section 17. In conjunction with
<br />review and revision of the bonding calculations for TR-53, an error was found in the topsoil replacement
<br />costs in the previous bond calculations. With the appropriate correction of the bond calculations to
<br />address this error, the TR-53 revision reduced the calculated mine reclamation liability by $1,568,751 to
<br />$14,102,823. Given bond liability coverage of $16,000,000, the remaining contingency amount increased
<br />to $1,897,177.
<br />The TR-56 submittal in 2002-2004, addressed changes in the postmining topography and drainages to
<br />reflect material balance and excess spoil considerations. The topographic changes, as well as updates
<br />relative to mine pit and reclamation location and status, necessitated some minor changes in the bond
<br />reclamation material movement volumes and distances. Revision of the bonding calculations to reflect
<br />these changes and updated labor and equipment costs resulted in a total calculated bond reclamation
<br />liability of $19,171,621 (an increase of $5,068,798). Based on the revised calculated bond reclamation
<br />costs and the current bond liability coverage of $16,000,000, Colowyo is in the process of obtaining an
<br />additional $3,500,000 of bond liability coverage, resulting in a bond contingency of $328,379.
<br />Calculations of the reclamation bond amount, all associated plans and designs, cost documentation, and
<br />summary table are included in Exhibit 13, Bonding Information.
<br />3.03 Release of Performance Bonds
<br />On September 25, 1987 Colowyo obtained Phase I and Phase II bond release for those areas delineated on
<br />Map 36, Bond Calculation Map - Regraded Topography South
<br />Details regarding this bond release can be found in Exhibit 13, Bonding Information, Appendix E.
<br />Rule 3 Performance Bond Requirements 3-2 Revision Date: 6/23/08
<br />Revision No.: MR-91
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