2010-01-19_PERMIT FILE - X201022310 (2)

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Travel will be confined to graded and surfaced roads during periods when excessive damage to vegetation or rutting of the land surface could result. The proposed activities will not require upland diversions, or diversions of ephemeral, intermittent or perennial streams. Drill Site Construction - The nine (9) boreholes proposed in this 2010 exploration program can be summarized by the following information: Coal Site # Surface Status Road Hole Denth Pact ci7e 1 ECM-XX-68 Hotchkiss Lease 500' r -- 2,250' 0.25 acre 2 ECM-XX-69 Hotchkiss Lease 770' 2,300' 0.25 acre 3 ECM-XX-70 Hotchkiss Lease -- 2,350' 0.25 acre 4 ECM-XX-71 Hotchkiss Lease 420' 2,440' 0.25 acre 5 ECM-XX-72 Hotchkiss Lease 370' 2,510' 0.25 acre 6 ECM-XX-73 Hotchkiss Lease 700' 2,460' 0.25 acre 7 ECM-XX-74 Hotchkiss Lease 1,360' 2,600' 0.25 acre 8 ECM-XX-75 Hotchkiss Lease 475' 2.670' 0.25 acre 9 ECM-XX-76 Hotchkiss Lease 225' 2,750' 0.25 acre Total 4,820' 22,430' 2.25 acres Most drilling can be conducted with minimal site preparation, since the drill rig can be set-up and leveled using self-contained hydraulic jacks. Where site preparation is necessary due to the need to utilize drilling fluids, a pad having maximum dimensions of approximately 80 feet in width and 130 feet in length will be established. Pad preparation will involve the use of a tracked dozer or backhoe to establish a level drill site. If topsoil exists, up to 12" will be salvaged and stored in a stockpile(s) located along the side of the pad and marked with a "topsoil" sign. Soil stripping will not occur in areas that have been previously disturbed and little or no soil material remains, typically in areas of 30% or greater slopes. The pad sites will be restored to approximate original contour. Shrubs, trees and other organic matter separately removed during pad preparation may be incorporated onto the regraded surface prior to seeding to enhance reclamation of this disturbed site. Each "mud" pit will typically be sized approximately 20 feet in length, 4 feet in width and 8 feet deep (23.7 cubic yards each). The pits will generally be located in the "cut" portion of the pad for pad stability. The maximum disturbance area for each drill site is expected to be approximately 0.25 acres. No surface blasting is anticipated. Drilling and Related Activities - 6 `/4" drill holes will be drilled using rotary or auger drilling methods to the depth of the desired coring interval, generally the E seam. Because of the depth of the hole, and the often difficulty in holding the hole open, a 4" steel "surface casing" is set in the hole. A coring barrel is then lowered into the 4" casing and the interval to D seam is cored. In order to avoid potential sample contamination, drill holes will be completed to the extent possible with air, air-foam, or water as the circulation medium. If drilling muds are necessary to maintain circulation and drill hole integrity, polymer muds that are free of metallic compounds will be utilized. • Page 4