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(Page 2) <br />MINE ID # OR PROSPECTING ID # M-2002-118 <br />INSPECTION DATE 1/25/2010 INSPECTOR'S INITIALS PSH <br />OBSERVATIONS <br />The Velarde Pit, File No. M-2002-118, was inspected by Peter Hays with the Division of Reclamation, Mining <br />and Safety (Division) as part of the Division's monitoring inspection program. Mr. Jim MacDonald with APC <br />Southern Construction Co., LLC was present during the inspection. <br />The Velarde Pit is located in Huerfano County approximately 13 miles north of Walsenburg, CO. The site was <br />previously inspected by the Division on June 15, 2005 in response to a Succession of Operator and Transfer of <br />Permit Application (SO-01). The Division approved the transfer of the Pino Pit permit from DG Huskin <br />Construction Co. to APC Southern Construction Co., LLC on August 8, 2005. <br />The site is permit for 300 total acres with 149 acres of disturbance divided into three phases with 20 acres of <br />maximum disturbance at one time. The 2009 annual report submitted by APC indicated mining and <br />reclamation occurred at the site during the year. The report indicated activity within Phase 3, but should <br />have indicated activity in Phase 1. The required 25 foot power line offset was confirmed during the <br />inspection. No processing facilities were observed during the inspection. Stockpiles of reject material, <br />recycled asphalt and processed material were observed southwest of the pit excavation. <br />All current mining activity is contained within Phase 1 of the site. The pit excavation was approximately 45 <br />feet deep, which is greatest extent of mining allowed by the Mining Plan. No ground water was observed <br />during the inspection. The north portion of Phase 1 is mostly mined out. Mining activities will proceed to the <br />south where the current processing and stockpiling areas are located. <br />The approved post mining land use is rangeland. Topsoil and overburden stockpiles were observed along the <br />south, north and west boundary of the pit. The stockpiles were vegetated and appeared stable. Reclamation <br />activities have started in the northeast corner of the pit by regrading the north slope to 3H:1V. Mr. <br />MacDonald stated the east slope in the northeast corner will be regraded this year. No topsoil had been <br />replaced at the time of this inspection. <br />The Division currently holds a financial warranty of $67,800, which is adequate to complete the reclamation <br />of the site based on the observations from this inspection. An entrance sign was posted and permit boundary <br />markers were observed as required by Rule 3.1.12. No problems were noted during the inspection. <br />I & E Contact Address cc: <br /> ? CE <br />NAME Mr. Jim MacDonald ? BL <br />OPERATOR APC Southern Construction Co., LLC ? FS <br />STREET 11802 W. 44th Ave ? HW <br />CITY/STATE/ZIP Golden, Colorado 80403 ? HMWMD (CH) <br /> ? SE <br /> ? WQCD (CH) <br /> ? OTHER