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Following are Nuvemco's responses to Memo from "DRMS Engineer Allen <br />Sorensen" dated March 9, 2010. <br />Paragraph 1 requests changes in abandonment of dry exploration drill holes. Nuvemco <br />anticipates drilling a few boreholes through the Summerville Formation (or the Wanakah Fm and <br />Tidwell Mbr of the Morrison Fm) into the upper Entrada for stratigraphic control. Nuvemco will <br />be drilling with air rotary methods and not be able to put a slurry into the boreholes. Nuvemco <br />agrees to backfill the penetrated Entrada portion of boreholes with bentonite chips which will <br />swell and seal the formation in the unlikely event that any groundwater penetrates the borehole <br />assuring the Summerville maintains its integrity as a confining unit. Nuvemco further agrees to <br />plug the upper five to eight feet of each hole with neat cement grout and has amended Exhibit E <br />— Reclamation Plan, 3. Exploration Drilling, paragraph two as follows: <br />"After geophysical and geological sample logging, the holes will be plugged and abandoned. <br />Boreholes which fully penetrate the Summerville Formation into the Entrada will have bentonite <br />chips inserted into the borehole to at least five feet above the Entrada to maintain the integrity of <br />the Summerville Formation as a confming unit. Above that zone, or in shallower boreholes, <br />plugging will be by backfilling with cuttings, pouring in bentonite chips from about ten to eight <br />feet below ground surface, and a neat cement grout to the surface (or a similar technique <br />approved by both BLM and DRMS). Any excess drill cuttings or sample piles will be raked into <br />the surrounding ground and if necessary and soil exists, the ground will be scarified and re- <br />seeded. All activities will be conducted by carefully accessing the site with minimal disturbance. <br />The exploration boreholes will be reclaimed continuously, as each borehole is completed and the <br />drilling rig moves to the next location." <br />Numerical paragraphs 1 and 2. Subsequent to review by Sorenson, Nuvemco submitted a Storm <br />Water Management Plan engineered by Energy Environmental Consulting, LLC, and reviewed, <br />stamped and signed by a Colorado Registered Professional Engineer, Thomas R. Hollingsworth. <br />We believe that report meets the requirements for Section 10 Surface Water Control and <br />Containment, and the report is to be included in Exhibit T. <br />Although the ditches adjacent to Montrose County Road DD 16 are well maintained and <br />certainly would help in the event of a major storm event, the natural topographic contours and <br />berms to be constructed by Nuvemco to divert storm water away from the waste rock dump are <br />designed to divert the peak flow around the mining area. <br />Paragraph No. 3 . Nuvemco believes the indurated, caprock of the Morrison Sandstone which <br />outcrops south of the waste rock dump is appropriate for the riprap proposed below the sediment <br />ponds. These rock ridges (and trees) will be removed prior to the expansion of the waste rock <br />dump to the south and are planned for the riprap. A DRMS determination of the durability and <br />non - slaking aspects of this native material is requested at the on -site visit scheduled for April 28, <br />2010. <br />Paragraph No. 4 . The above described Storm Water Management Plan addresses volume and <br />peak flow of runoff from the ore stockpile confirming adequacy of design. <br />18 <br />