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(Page 5) <br />MINE ID # OR PROSPECTING ID # M- 1981 -185 <br />INSPECTION DATE 11/24/09 <br />INSPECTOR'S INITIALS WHE <br />The following problems (PB) and /or possible violations (PV) (and suggested corrective actions) were identified during this <br />inspection. The problems should be corrected by the dates given, or they will become possible violations. The possible <br />violations should be corrected by the dates given to reduce their severity when considered by the Mined Land Reclamation <br />Board. The inspector noted on the previous page should be notified of all corrective actions taken. <br />PROBLEMS /POSSIBLE VIOLATIONS <br />AND <br />CORRECTIVE ACTIONS <br />CORRECTION <br />DATE <br />1 The Operator has constructed a mill facility at Level 1 area, not addressed by the permit and <br />has thereby failed to comply with permit conditions. 2 /15/10 <br />PB or PV: PV <br />CORRECTIVE ACTION: Within 60 days of the signature date of this report, by TOPIC(S): MP <br />February 15, 2010, file a modification to the permit, through the Amendment process, per i3a — — <br />Rules 1.10(2), (3), (4) and (5), to fully describe all major components of the operation <br />including, but not limited to, the newly constructed mill facility. <br />The Division believes that by failing to amend the permit, to incorporate the mill facility prior to <br />constructing the mill facility, the Operator has violated the conditions of his own permit. <br />Pursuant to C.R.S. 34 -32- 124(1), the Division has scheduled the possible violation for <br />consideration by the Board, to occur during the February 10 -11, 2010 Board meeting. <br />2 • The Division has reviewed the current cost of reclamation totaling $148,329. Therefore, the <br />existing $38,209 financial warranty appears insufficient to ensure reclamation. 2 /15 <br />PB or PV: PB <br />CORRECTIVE ACTION: Within 60 days of the signature date of this report, by TOPIC(S): FN <br />February 15, 2010, increase the amount of financial warranty to an amount not less than _ <br />$148,329, or complete portions of the reclamation plan to ensure the sufficiency of the <br />existing $38,209 financial warranty. <br />