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(Page 2) <br />MINE ID # OR PROSPECTING ID #: nn-gn(A-na7 <br />INSPECTION DATE: 9/14/1-9 INSPECTOR=S INITIALS: MAC' <br />OBSERVATIONS <br />The inspection was conducted by Michael Cunningham of the Colorado Division of Reclamation, Mining and <br />Safety (Division). Jon File of Farfrumwurkin, LLLP was also present for the inspection. The File Pit 112 is <br />located approximately 2 miles north of Erie, Colorado. The site is permitted for 314.14 acres and the approved <br />post mining land use is developed water resource. <br />The mine site is divided into east and west halves by Weld County Road 3 1/4. The portion of the mine site that <br />lies on the east of Weld County Road 3 1/4 has not been mined; currently the field is being used for agriculture <br />purposes. The actively mined portion of the mine site will result in a north and south reservoir, which will be <br />mined in 11 cells. Dewatering trenches have been established in the active mining areas to facilitate dry mining. <br />Active mining is taking place in the southwest corner of the permit area or the southern reservoir. Extraction is <br />occurring in Cell E and Cell F. The northern half of Cell E is being used to stockpile product. Approximately <br />3.5 acres of Cells E and F have yet to be mined. Clay is being stored on the pit floor in both of these Cells and <br />will be used to line the pit walls. Once the pit walls have been reclaimed in Cells E and F, mining will progress <br />into Cells G, K, and J where the overburden has been stripped in preparation. <br />Reclamation is currently being carried out in Cells A, B, and C. Phase A has been mined out and the slopes have <br />been graded to 3H:1 V. A stockpile of clay is being stored on the west side of Cell A and will be used to line the <br />pit walls. Cells B and C have been mined out; the pit walls are scheduled to be graded in 2009. Several <br />stockpiles of sand are located on the pit floor in Cells B and C; the sand will be used during reclamation to <br />establish beaches on the reservoir. During the inspection it was noted that Tamarisk (salt cedar) was growing <br />along the east pit wall in Cells B and C. Tamarisk is listed on Colorado's Noxious Weed list; its presence has <br />been cited as a problem and will require corrective action by the Operator. Please see Page 3 of this report for <br />the required corrective actions. <br />The topsoil has been segregated and stockpiled on top of the west pit wall in Cell B; the stockpile has been <br />vegetated and is stable. Another topsoil stockpile is located to the west of the scalehouse in Cell H. The <br />stockpile has not been vegetated. If the topsoil stockpile is to remain in place longer than one growing season, it <br />must be stabilized with vegetation to prevent erosion. At the time of the inspection the stockpile was stable and <br />did not show any signs of erosion. <br />A review of the permit file found that the Division does not have a current copy of the Operator's Substitute <br />Water Supply Plan and Well Permit. This has been cited as a problem and will require corrective action by the <br />Operator. Please see Page 3 of this report for the required corrective action. <br />The Division currently holds a financial warranty in the amount of $476,500.00. Based on the observations of <br />this inspection, this amount was determined to be sufficient to complete reclamation. <br />This concluded the inspection. <br />I & E Contact Address <br />NAME: Jon File <br />OPERATOR: Farfrumwurkin. LLLP <br />STREET: I I A3 Oakhurst Dr_ <br />CC: E State Engineer <br />CITY/STATE/ZIP: RrnomfiPld (-0 80038