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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 />August 31, 2009 <br />John McCulloch <br />New Elk Coal Company, LLC <br />122 West First Street <br />Trinidad, CO 81082 <br />RE: 2008 Annual Hydrology Report Review, Lorencito Canyon, #C-96-084 <br />Dear Mr. McCullogh: <br />COLORADO <br />D IV IS I ON 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 />The Division of Reclamation, Mining, and Safety has completed review of the 2008 <br />Annual Hydrology Report (AHR) for the Lorencito Canyon mine. <br />Monitoring Frequency <br />The operator met the approved monitoring frequency in 2008. Alluvial wells and <br />surface sites were visited and sampled for water level or flow and field parameters on a <br />semi-annual basis and required water samples were taken for laboratory analysis <br />during the fourth quarter. Water samples were analyzed for the approved analytical list <br />as required. <br />Water Quantity and Quality <br />March 2001 data, as reported in the 2000 Annual Hydrology Report, is the most <br />representative pre-mine data for the stations currently part of the approved hydrologic <br />monitoring program. Coal bed methane (CBM) development and the associated water <br />discharge influence the surface and ground water systems. Water quantity is not <br />affected by mining activities. <br />An increase in total dissolved solids (TDS) has been documented and continues to be <br />supported by the sampling data reported in 2008. This increase coincides with the <br />development of the coal bed methane and the resulting water discharge associated <br />with that activity. Perennial CBM water discharge down Jeff Canyon and Puerticito <br />Canyon appear to cause the increase in TDS at LC-1 and in alluvial well MWLC-1 in <br />lower Lorencito Canyon. <br />Office of Office of <br />Mined Land Reclamation Denver • Grand Junction • Durango Active and Inactive Mines