2009-07-15_REPORT - M1988044 (2)

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ANNUAL STATUS REPORT TO COLORADO STATE BORAD OF LAND COMMISSIONERS SAND GRAVEL LEASE: GL-264 (FOURTH AMENDMENT) LOWRY RANGE COAL CREEK (QUINCY AVE. SOUTH TO COUNTY LINE) SCHMIDT CONSTRUCTION COMPANY APPLICABLE YEAR: 2009 DUE DATE: JULY 15, 2009 In accordance with the requirements of Paragraph 6 of the lease and Item '[.A.5 of the Operation Plan, the following information is provided as a status report for the year preceding the due date stated above. This information updates the previous annual status report information. Any updated maps presented in this report contains not only the information for the current year, but information for prior years as well. If no new map is provided then there was no change in the information provided on the previously submitted map. Thus, as conditions change, the maps are kept up to date on an annual basis without a need to refer back to previous maps. Any maps that were not updated are so indicated in this report so the most current map can be located for reference as needed. DATE OF FINAL INSPECTION FOR PREPARATION OF THIS REPORT: June 19, 2009 SUMMARY OF THE CURRENT STATUS REPORT YEAR: The 2008-2009 operation year (July 15, 2008 - July 15, 2009) was an incredibly slow year for the operation. With the economy in recession (depression?), demand for sand was about 30% of the previous year. Often there was not even enough income to cover expenses, even with a reduced staff at the site. Although sand was harder to find that did not matter so much because the demand was so low. Some slight improvement was seen at the end of the year, but it was still very low and far below historical levels of demand. All of the remaining county approvals were completed in early 2009. With everything settled at the county level, a technical revision to the Reclamation Permit was submitted to adjust the affected land areas to be consistent with the various agreements and requirements set before final county approvals were issued. This primarily made the operation consistent with the 300 acre limitation and set the locations were mining could and could not occur. Reclamation of older disturbances proceeded this year with a large amount of backfilling, grading and seeding being done. The entire high area in the uplands was completed and seeded. Climatically, the winter was again mild and fairly dry. But in the spring of 2009 moisture returned in abundance and sometimes an overabundance. Seeded areas in 2008 that germinated later in 2008 after the long, hot and very dry summer of 2008 showed considerable growth weakness but adequate germination until the wet spring arrived. It appears there was sufficient establishment in late 2008 that the 2009 moisture allowed a robust and rich growth of both planted and local invaders to do exceptionally well. Some areas still show some weakness in density and the desirable species are just marginally sufficient. No corrective actions are planned until it is seen how this summer goes. Nothing may need to be done if development and seed Status report for 2009 due July 15, 2009 Page 1 of 10