2010-01-25_PERMIT FILE - C1981044A (5)

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INTRODUCTION BTU Empire Company, LLC, or a predecessor company (EC), submitted a permit revision to Permit No. C -81 -044. • The permit revision allowed mining of the "E" Coal Seam located directly under the "F" Coal Seam, previously mined at this location. With that application, EC prepared a detailed Mining and Reclamation Plan to effect compliance with the Coal Regulations of the Colorado Mine Land Reclamation Board, and in addition, has reorganized and updated all applicable information in its presently approved permit. EC plans to utilize longwall mining as its primary mining method. However, the standard room - and - pillar mining method will be utilized for development of the longwall panels, and if needed, to supplement coal production. The name of the EC operation will be "Williams Fork Mines ". Background of Williams Fork Mines Ownership The Williams Fork Mines are owned by BTU Empire Company, LLC, a Delaware Corporation with Articles of Incorporation on file with the Secretary of State of Delaware. The principal shareholder of BTU Empire Company, LLC is the Peabody Investments Corporation, located in St. Louis, Missouri. The Williams Fork Mines were previously known as the Eagle Mines, and were acquired from RAG American Coal Holding on April 16, 2004. The operator name was changed to BTU Empire Company, LLC, from the previous name of BTU Empire Corporation in late 2010. A brief summary of the history of ownership shows that CEC (Cyprus Empire Corporation) operated the Empire Eagle Mines beginning in 1972 as a subsidiary of Zigler Coal Co. Cyprus Coal Company later acquired the Empire Eagle Mines from Zigler Coal Company in 1982, and began operating under an approved Colorado Mine Land Reclamation Board permit from August 1983 through August 1995. RAG American Coal Holding then acquired the mine (RAG EC) from Cyprus in 1999. . Geographical Settin The EC site lies approximately seven miles south of Craig, Colorado on State Highway 13. The mine site, and adjacent area lie at the foot of the prominent Williams Fork Mountains, which trend east to west immediately to the South. The general geographical location of the EC operation is shown on Figure 1, General Location Map. The elevation of the permit area ranges from a low of approximately 6,130 feet in the Big Bottom area, to a high of about 7,400 feet in the Williams Fork Mountains. The entire operation is located in Moffat County, Colorado. Two major northwestern Colorado rivers intersect the permit area, these Yampa River and the Williams Fork River. The Yampa River runs from north to south through the permit area, while the Williams Fork River runs from south to north, and intersects the Yampa River just north of the mine facilities area. The northern portion of the permit area is dominated by the Big Bottom alluvium, while the southern and eastern portions of the permit area are dominated by the Williams Fork Mountains and the river beds of the Yampa and Williams Fork Rivers. Brief History of Area The EC Mine Site is located in an area which has been previously mined by surface and underground mining. The earliest records of mining show that underground mining began in the area in the late 1920's and early 1930's. Surface strip mining began on this site and adjacent areas around 1975. The major historic mines which have operated in this area include the Wise Hill Mines (1, 2, 3, and 4); the Williams Fork Strip Mines (1, 2, and 3), and the Trapper Strip Mine. The Trapper Strip Mine began operations in 1976 and operations have continued through the present. • EC began mining in the Eagle No. 5 Mine in 1972 and continued through 1995, when operations went into temporary cessation. The No. 5 Mine ( "F" Coal Seam) utilized room - and - pillar methods until 1985, when economics dictated a change to longwall mining methods. MR09 -48 -1- 10/26/09