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STATE OF COLORADO <br />DIVISION OF RECLAMATION, MINING AND SAFETY <br />Department of Natural Resources <br />1313 Sherman St., Room 215 <br />Denver, Colorado 80203 <br />Phone: (303) 866-3567 <br />FAX: (303) 832-8106 <br />July 31, 2009 <br />Scott Wanstedt <br />Blue Mountain Energy, Inc. <br />3607 County Road #65 <br />Rangely, CO 81648 <br />RE: Deserado Mine, Permit C-81-018 <br />Second Quarter 2009 Coal Processing Waste Banks Report <br />Dear Mr. Wanstedt, <br />The Colorado Division of Reclamation, Mining, and Safety (CDRMS) have found the above <br />referenced report to be in compliance with CDRMS Regulations: 4.09.1(11) and 4.10.2(2). <br />COLORADO <br />D I V I S I O N OF <br />RECLAMATION <br />MINING <br />SAFETY <br />Bill Ritter, Jr. <br />Governor <br />Harris D. Sherman <br />Executive Director <br />Ronald W. Cattany <br />Division Director <br />Natural Resource Trustee <br />Please note that a minimum of quarterly inspection is required and for Deserado, more frequent <br />inspection is required during critical construction periods associated with 1) removal of topsoil, 2) <br />installation of surface drainage systems, 3) placement and compaction of materials, and 4) <br />revegetation. Please ensure that these specific activities are inspected and documented by date in the <br />report if they should occur during the quarter. <br />It is noted that refuse was spread and compacted during the second quarter. Ten compaction tests were <br />conducted and all areas tested exceeded the required proctor level of 90%. <br />The Division acknowledges that County Road 65 was subsided during the quarter with only superficial <br />signs of subsidence noted and no corrective actions were necessary. <br />If you have any questions feel free to contact me. (303) 866-3567 ext 8134 <br />Sincerely, <br />Jason Musick <br />Environmental Protection Specialist <br />Office of Office of <br />Mined Land Reclamation Denver • Grand Junction • Durango Active and Inactive Mines