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OAKRIDGE ENERGY, INC. <br />CARBON JUNCTION MINE (C-1992-080) <br />ANNUAL HYDROLOGIC REPORT <br />WATER YEAR 2008 <br />The Oakridge Energy, Inc. Carbon Junction Mine (CDMG Permit No. C-1992-080) is <br />located approximately 2.5 miles southeast of Durango, Colorado. The mine is located on <br />Ewing Mesa near the junction of Highways 160 and 550. The mine site is located in the <br />upper drainage basin of Carbon Junction Canyon. Carbon Junction Canyon is an <br />intermittent tributary of the Animas River. Much of the Carbon Junction Canyon <br />drainage has a steep grade with a total drainage basin of 0.8 square miles. <br />Hydrologic sampling and data collection was conducted at the Carbon Junction Mine <br />betwen 1982 and 2006. The mine site was originally permitted by the Colorado Division <br />of Reclamation, Mining and Safety (CDRMS), formerly the Colorado Mined Land <br />Reclamation Division, in 1983 and re-permitted in 1993. Coal mining activity was <br />initiated on the site on a minor scale. The extent of coal mining activities at the Carbon <br />Junction Mine included opening both the North and South pits. Ancillary activity <br />included construction of a permanently reclaimed spoils area, sediment control structures, <br />topsoil stockpiles, and a pad for equipment. Permanent reclamation at the mine site was <br />initiated in 1998 and completed in August 2006, with the only outstanding reclamation <br />being the two sediment ponds and topsoil piles. After approval of Technical Revision 15 <br />and Minor Revision 06 (demonstrating achievement of natural sediment generation levels <br />on the reclamation) by CDRMS, reclamation of the sediment ponds and sediment control <br />system commenced, with backfilling and topsoiling completed in December 2008. <br />During discussions concerning Technical Revision 13 during 2005 and 2006, Oakridge <br />energy and CDRMS agreed to terminate groundwater (well) and surface water (spring and <br />seep) monitoring at the mine site, effective in 2006. It was concluded that the limited <br />mining activities at the mine did not negatively impact the hydrologic balance over the <br />course of the operation. The remaining hydrologic monitoring at the mine includes <br />discharge monitoring (required for the CDPS permit) and quarterly sediment pond <br />inspections. <br />This report includes the sediment pond inspection reports and discharge monitoring <br />reports for the 2008 water year (October 2007 through September 2008). <br />SEDIMENT POND INSPECTIONS AND DISCHARGES <br />The Carbon Junction Mine has two sediment ponds, 001 and 002. Michael Savage of <br />Savage and Savage, Inc. prepared inspection reports for both sediment ponds during the <br />first (November 28, 2007), second (March 24, 2008), third (May 6, 2008) and fourth (July <br />Carbon Junction Mine Page 1 <br />Annual Hydrologic Report for Water Year 2008