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Reclamation Cost Assessment
<br />The operator has included documentation in the amended bond release application in support of a
<br />requested release of $3,772,952.00 (3/10/09 "Response to Comments"). As a component of the bond
<br />release evaluation, the Division has reviewed the operator's estimate and justification, and has
<br />performed an independent cost estimate reflecting the degree of difficulty and estimated cost to
<br />complete remaining reclamation. The Division's SL-3 cost estimate reflects substantial liability
<br />reduction based on the extent of topsoil replacement properly completed, and successful
<br />establishment of vegetation cover, within the 1213.1 acre area for which the Division proposes to
<br />grant Phase II bond release (includes all of BRB-2 and all but 36 acres of BRB-3, but entirely
<br />excludes BRB-4). The SL-3 estimate reflects retention of sufficient bond to cover revegetation costs
<br />within the proposed release area, until final Phase III bond release is approved, in accordance with
<br />Rule 3.03.1(3)(a). Please see the Division's SL-3 Reclamation Cost Estimate Summary
<br />memorandum, Attachment 2 to this document.
<br />Rule 3.03.1(2)(b), limits combined Phase I/Phase 11 release amounts to "up to 85% of the bond
<br />amount applicable to an increment or a permit area". The original "applicable bond amount" for the
<br />entire permanent program disturbance was $9,507,953.00. This "applicable bond amount" was
<br />determined with the approval of TR 41. At the time of Phase I release, a maximum of 60% of the
<br />original bond amount, or $5,704,771.80, could have been released. Since not all of the area met the
<br />Phase I release standards, a portion of the permit area was not Phase I bond released (as documented
<br />in the Findings of Compliance document for SL-1). Estimated costs to reclaim remaining areas of
<br />liability following the proposed Phase I release were higher than what would have remained had a full
<br />release of up to 60% been granted, so the Division released $3,481,593.00 for Phase I, retaining the
<br />estimated $6,026,360.00 necessary to complete reclamation work at the site. For Phase II bond
<br />release, an additional 25% of the original reclamation cost on the permanent program areas is
<br />$2,376,988.25. Since not all areas of disturbance have undergone Phase I release, and not all
<br />disturbed areas meet the Phase II release requirements, the Division is proposing a liability release of
<br />$1,975,695.00 for this Phase II request.
<br />The liability amount calculated by the Division for SL-3 is $4,336,149.00; $4,050,665.00 for interim
<br />and permanent program disturbance and $285,484.00 for the pre-law areas. This amount reflects the
<br />Division's estimate of costs to reclaim remaining disturbance and/or reclamation for which the
<br />operator is liable, assuming the work were to be completed by a third party.
<br />SENECA II BOND RELEASE AMOUNTS
<br />Interim and Permanent Program Areas
<br /> Original
<br />Liability Phase I
<br />Release Phase II
<br />Release Phase III
<br />Release
<br />SL-1 and SL-
<br />2 $9,507,953.00 3,481,593.00
<br />SL-3 6,026,360.00 1,975,695.00
<br />Current 4,050,665.00
<br />Pre-Law Areas
<br />SL-1 and SL-
<br />2 $1,355,000.00 $1,069,516.00
<br />Current 285,484.00
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