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f. The parties acknowledge and understand that there is a pond that is located within <br />the Oil and Gas Operations Area in the NEANWA where the Cinque #4 well is currently located <br />("NE/4NW/4 Location"). ASCI agrees to backfill the area of the pond depicted on Exhibit B <br />with dirt materials, at its sole cost and expense, on the earlier date of either: i) within 120 days <br />from the date that a final application for development is approved for all or any portion of the <br />Property; or ii) within fifteen days from the date it receives notice from a Petroleum Lessee of an <br />intent to drill a well within the NEANWA Location. In the event that ASCI fails or refuses to <br />backfill the pond within the time provided herein, ASCI and/or SSV, as applicable, shall provide <br />the Petroleum Lessees with an additional Oil and Gas Operations Area to be located on the east <br />side of Boulder Creek, and partially within the drilling window in the NEANWA, which Oil and <br />Gas Operations Area shall be comparable in size and configuration to the NEANW/4 Location. <br />Petroleum Lessees shall at the same time identify an access route and pipeline easement to the <br />Oil and Gas Operations Area to be selected by them in consultation with the Surface <br />Owners/Lessees, and the parties shall thereafter enter into an amendment to this Agreement to <br />which they attach a plat that shows the Oil and Gas Operations Area, access route and pipeline <br />easement, and to be recorded in the Office of the Clerk and Recorder for Weld County. <br />2. EXTRACTION OF SAND AND GRAVEL IN VICINITY OF OIL AND <br />GAS OPERATIONS AREAS; SETBACK REQUIREMENTS. <br />ASCI reserves the option to mine the gravel within the Oil and Gas Operations Areas in <br />accordance with the terms of this Agreement. <br />a. In the event that ASCI elects to mine gravel within an Oil and Gas Operations <br />Area, ASCI shall notify Petroleum Lessees in writing 60 days prior to commencing mining <br />operations within the Oil and Gas Operations Area and shall place temporary concrete barriers <br />around the Existing Wells, as directed by Petroleum Lessees, prior to commencement of mining <br />operations. <br />b. In the event that ASCI elects to mine gravel within an Oil and Gas Operations <br />Area with no Existing Well, ASCI shall conduct and complete its mining operations within the <br />Oil and Gas Operations Area as quickly as is reasonably practicable. In the event that Petroleum <br />Lessees intend to drill a Well within the Oil and Gas Operations Area, they shall give written <br />notice to ASCI or the then current surface owners, as applicable, and meet at the site with ASCI, <br />or the then current surface owners, as required by Colorado Oil and Gas Conservation <br />Commission ("COGCC') rules and regulations, and the parties shall coordinate mining <br />operations with oil and gas operations; provided, however, Petroleum Lessees shall have priority <br />to conduct their oil and gas operations within the Oil and Gas Operations Area such that they <br />may require ASCI to temporarily cease mining operations or adjust the timing and location of <br />such operations within the Oil and Gas Operations Area as necessary to conduct their oil and gas <br />operations in a safe and efficient manner. Upon completion of the mining operations, ASCI shall <br />fill and level the mined areas to create an even grade throughout the Oil and Gas Operations <br />Area. <br />C. In the event ASCI elects to mine gravel in an Oil and Gas Operations Area that <br />has an Existing Well or Wells, ASCI shall conduct mining within the Oil and Gas Operations <br />Area by excavating pie shaped wedges of gravel and aggregate and thereafter backfilling and <br />8711\23\1008866.2