2009-01-20_PERMIT FILE - X200923100

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5) Describe Exploration Activities Proposed Exploration Activities: The primary methods of exploration and geologic and chemical data collection proposed in this application include exploration drilling, geophysical logging, and sampling, followed by reclamation of all exploration disturbances, as more specifically described in the following sections. The 2009 exploration program involves 15 exploration drillholes to further delineate and characterize geologic conditions, coal seam occurrence and quality, and overburden physical and chemical characteristics. The drillholes are designated as ccu034 through ccu048, with an additional numeric descriptor to be added to designate the year in which each drillhole is completed (e.g., 2009ccu040). This identification sequence is a continuation from the 2007 and 2008 exploration work permitted by Colorado Coal Resources, LLC (an affiliated company) for the Sage Creek project area. Each of the proposed 2009 drill-sites are shown on Map 1, and listed in Table 1. Depending on drilling conditions, core recovery, and data requirements, the potential exists that it may be necessary to off- set from an initial drillhole location (no more than 20 feet and within the same drill pad disturbance area) and "twin" the original drillhole for the purpose of further sampling or geologic/hydrologic testing. However, "twinning" of any hole will not occur prior to necessary approvals by CDRMS, and if necessary, BLM. Sage Creek plans to initiate exploration activities immediately upon receipt of required approvals, and continue as weather and ground conditions allow. Sage Creek Holdings anticipates drilling ccu038 and ccu043 during the winter months. Exploration sites ccu034, 035, 036, 037, 039 and 040 can be drilled at any time of the year (including the May 1 - July 1 grouse breeding and nesting season). Exploration activities at the remaining seven sites will occur after July 1, and in the case of ccu041, 042, 045 and 046 after September 1". It is anticipated that drilling activities will be completed by the end of 2009, although weather or other unanticipated delays may result in extension of the activities through fall of 2010. Sage Creek plans to schedule drilling operations on a 12-hour per day basis (approximately 7:00am to 7:00pm); however, Sage Creek requests permission to conduct operations on a 24-hour per day basis if unforeseen delays cause the project to fall behind schedule. In the event of winter drilling activities, Sage Creek will coordinate with the CDOW to keep specific gates locked to preclude public access, and to avoid areas of critical winter range. Sage Creek will also coordinate with the CDOW to minimize potential impacts during the Columbian sharp-tailed grouse hunting season (September 1 to September 21). Site Development - Exploration Access: Primary access to the proposed exploration area will be via existing Routt County Road 27, southeast of Hayden, Colorado. As shown on Map 1, existing Routt County Roads 27, 27A, 51C and 51D, as well as, existing graveled coal mine haul roads and unimproved ranch roads and jeep trails will be utilized to access exploration drill-sites within the exploration area. Sage Creek has specifically sited proposed drill-sites adjacent to existing roads and in areas of previous disturbance in order to minimize any new disturbance associated with the proposed exploration activities. There may be limited instances where direct access to a proposed drill-site is not possible using the existing road network. In these circumstances, drilling equipment will be moved overland the short distance between the existing roadway and proposed exploration pad without constructing a new road. In accordance with Rules 2.02.2(2)(f) and 4.21.4(3)(a), vehicular travel on other than established graded and surfaced roads will be limited to that absolutely necessary to conduct the exploration. Travel will be confined to graded and surfaced roads during periods when excessive damage to vegetation or rutting of the land surface could result from such travel. SW rn,k Pro/eU-1009 NOI p 0fi0&09 8