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RULE 3 PERFORMANCE BOND REQUIREMENTS <br /> Rule 3.01- Introduction <br /> This Rule sets forth minimum requirements and responsibilities for filing and maintaining performance <br /> • bonds for surface coal mining and reclamation operations, and coal exploration, in accordance with the Act. The <br /> Rule includes minimum requirements for determining the amounts and periods of liability for performance bonds; it <br /> establishes minimum standards for the form, conditions, and terms of performance bonds; it sets forth minimum <br /> provisions for criteria, schedule, and procedures for release of performance bonds; it establishes provisions to be <br /> applicable whenever a proceeding for the forfeiture of all or any part of a performance bond, as a result of a failure <br /> to meet the conditions upon the bond, is initiated; and it sets forth special requirements for construction of certain <br /> min drainage control facilities. <br /> Twentymile Coal Company (TCC) is currently bonded for the surface disturbance and reclamation of the Foidel <br /> Creek Mine under several bonds, the primary one of which is a Travelers Casualty and Surety Company of America <br /> Bond (Bond Number 104294144) in the amount of $7,643,701.00. The total bond held by the CDRMS is <br /> $8,083,089. <br /> TCC's bond reclamation cost estimate for the CRDA Expansion (TR09 -67) takes into account the consideration <br /> that bond monies have already been posted for the existing Refuse Pile, which includes the entire eastern side that <br /> will be redisturbed by the proposed CRDA Expansion. This existing bond, along with the calculated bond coverage <br /> for an initial bonded disturbance area of approximately 50 acres, addresses bonding for the initial area of <br /> disturbance. This initial bonded area includes redisturbance of the eastern side of the existing RDA, the initial <br /> CRDA bonded disturbance area, haulroad disturbance, stockpile and ditch disturbance, stockpile access corridors, <br /> and a bonded buffer to address any minor unplanned disturbances. With a total facility life of approximately 14 to <br /> 20 years, it is anticipated that the remaining 50 acres of the total CRDA expansion area of 140 acres will be bonded <br /> in two future bond increments of approximately 20 -30 acres each. It is anticipated that Bond Increment I will occur <br /> 3 -5 years in the future, and that Bond Increment II will occur 7 -10 years in the future. Consistent with the <br /> constraints inherent in a cumulative bonding approach, TCC will clearly delineate bonded areas, will limit <br /> disturbance to those areas, and will work with the CDRMS to determine and maintain adequate bond coverage for <br /> all activities. <br /> Additional security required due to any new mining activities planned under permit revisions will be obtained and <br /> submitted to the CDRMS in accordance with Rule 3.02. Calculations of bond reclamation liabilities are provided in <br /> Appendix A to the PAP. <br /> • <br /> • <br /> TR09 -67 3.01 -1 11/13/09 <br />