2009-10-05_GENERAL DOCUMENTS - C1996083

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BOWIE NO.2 MINE Permit No. C-1996-083 Midterm Review This is the 2009 midterm review findings document for the Bowie No. 2 Mine. The midterm review is required under Rule 2.08.3 to be performed not later than the middle of each five year permit term. Through this review, the Division can require reasonable modifications to the permit in order that the permit application complies with the regulations. Rule 3.02.2(4) requires that the amount of the reclamation liability bond be reviewed during the midterm and adjusted, if necessary. This findings document is divided into four sections. Section I describes the history of the mine. An account of the permitting and enforcement actions, including permit revisions, stipulations and enforcement actions, is contained in Section 11. The reclamation liability bond information is in Section 111. The final section contains specific questions or comments that arose in the review of the permit application. Section I - Mine History The Bowie No. 2 Mine is an underground coal mine located about five (5) miles northeast of Paonia, Colorado, adjacent to old State Highway 133 and near the old Bowie townsite. The permittee is Bowie Resources LLC (BRL). As of the date of this midterm review, the permit area includes 5,864.8 acres, of which 2,612.3 surface acres are privately owned and 3,252.5 surface acres are federally owned. The coal to be mined is federal and private. The mineral ownership is 3,907.5 acres of federal and 1,957.3 acres of private. The disturbed acreage amounts to 309.9 acres while the affected area is 3976.1 acres. The mine permit area is located on federal and private lands within Delta County, Colorado. The Bowie No. 2 Mine is designated as a federal mine for the purposes of permit and inspection regulation. The original permit was issued on April 4, 1997 and construction of the mine site began in mid 1997. The normal production rate is about 5 million tons per year, although the mine has approval for a maximum annual production of 6 million tons per year. Recently, however, coal production has been reduced due to methane issues in the mine. The original permittee of the Bowie No. 2 Mine was Bowie Resources Limited. However, through Succession of Operator No. 2 in 2004, the permit was transferred to Bowie Resources LLC. In Succession of Operator No. 3 (SO-3), the owners of Bowie Resources LLC were changed. However, SO-3 has not been issued yet due to a recommendation by the Applicant Violator System (AVS) to deny the transfer request. The denial was based on the fact that Bowie Resources LLC was delinquent in paying the second quarter 2009 abandoned mined lands fee. The issue is in the process of being resolved.