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Richard Raines Page 4 <br />January 6, 2009 <br />The mining operation has continuously dewatered directly back to the Big Thompson River since <br />2000. The estimated dewatering rate at the Wagner/Kauffman Pit #3 site is approximately 1000 gallons <br />per minute. As long as the pit is continuously dewatered, the water returned to the stream system should <br />be adequate to offset the depletions. Once dewatering at the site ceases the delayed depletions must be <br />addressed. As required by condition of approval no. 13, a plan must be submitted that specifies how the <br />post pumping dewatering depletions (including refilling of the pit) will be replaced, in time, place and <br />amount, at least three years prior to completion of dewatering. <br />Replacements <br />Replacement water for this pit will continue to be made available throughout the year from an <br />existing lease of 20 acre-feet of fully consumable water from the City of Loveland ("Loveland"). A copy of <br />the lease associated with the mining operation was provided to the State Engineer's Office with the plan <br />requested on November 10, 2006 and a copy of the lease is attached to this letter. The duration of the <br />lease is from January 1, 2007 through December 31, 2009. A 4 percent transit loss from Green Ridge <br />Glade Reservoir to Wagner/Kauffman Pit No. 3 has been applied to the delivery of the replacement water. <br />In the event that Loveland plans to use Colorado-Big Thompson ("CBT") Project water as a replacement <br />source, Loveland needs to comply with the Interim Rule issued by the Northern Colorado Water <br />Conservancy District ("District") in May 2005 regarding the use of CBT Project water in substitute water <br />supply plans. Prior to the use of C-BT Project water, Loveland is required to notify this office, the division <br />engineer and the water commissioner of the amount of C-BT Project water dedicated to this plan and <br />provide a copy of the District's approval letter as required by paragraph 1(g) of the District's May, 2005 <br />Interim Rule. <br />The monthly depletion and replacement requirements are indicated on the attached Table 3. <br />Conditions of Approval <br />I hereby approve the proposed substitute water supply plan in accordance with §37-90-137(11), <br />C.R.S., subject to the following conditions: <br />1. This plan is approved with the effective date of January 1, 2009 and shall be valid through <br />December 31, 2009 unless otherwise revoked or modified. This plan will be extended until <br />December 31, 2010, if the applicant provides a copy of the City of Loveland lease to this office by <br />November 15, 2009 to cover the 2010 gravel pit depletions (January 1, 2010 through December <br />31, 2010). <br />2. If this plan will not be made absolute by a water court action by the plan's expiration date, a <br />renewal request must be submitted to this office with the statutory fee (currently $257) no later <br />than November 15, 2009 or November 15, 2010, subject to the requirements of condition 1 above. <br />3. Well permit no. 65258-F was obtained for the current use and exposed pond surface area of the <br />gravel pit in accordance with §37-90-137(2) and (11), C.R.S. <br />4. The total surface area of the groundwater exposed at the Wagner/Kauffman Pit No. 3 must not <br />exceed 2.6 acres resulting in 6 acre-feet per year of evaporative loss. <br />5. The total amount of product mined at the Wagner/Kauffman Pit No. 3 during 2009 and 2010 shall <br />not exceed 350,000 tons per year, which results in 10.3 acre-feet of water lost with the mined <br />product.