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(Page 2) <br />MINE ID # OR PROSPECTING ID # M-2010-004 <br />INSPECTION DATE 04/16/2010 <br />OBSERVATIONS <br />INSPECTOR'S INITIALS PSH <br />This was a pre-operation inspection of the Leone Huerfano Gravel Pit conducted by Peter Hays with the <br />Colorado Division of Reclamation, Mining and Safety (Division). Mr. Joe Gagliano with L J Development, Inc. <br />was present during the inspection. <br />The 112c application package was received by the Division on January 22, 2010 and deemed complete for <br />purposes of filing on February 25, 2010. The current permit application decision date is May 26, 2010. The <br />pit is located approximately 11 miles northwest of Walsenburg, Colorado in Huerfano County. The required <br />notice sign was posted at the entrance gate from County Road 611 and the permit boundary corners were <br />delineated with metal t-posts. <br />The proposed Leone Huerfano Gravel Pit will be 185.67 total acres divided into 9 mining phases of less than <br />23 acres each. Mining activity will commence in the middle of the site, north of County Road 611.1. The site <br />will be excavated as an open pit using standard mining equipment. The expected gravel deposit depth ranges <br />from 12 to 18 feet deep. The gravel deposit was observed along the north terrace outcrop to be 6 to 8 feet <br />deep. The gravel will be processed on-site by crushing and screening. No washing is permitted until the <br />ranch well use is changed with the Office of State Engineer and the required permits are obtained from the <br />Colorado Department of Public Health and Environment. No groundwater is expected to be encountered <br />during mining. No water will be discharge to the Huerfano River. <br />The present land use is rangeland. The current vegetation consists of grazed native grasses and forbs. No <br />noxious weeds were observed during the inspection. The proposed post-mining land use is rangeland. The <br />proposed reclamation plan consists of creating a flat pit floor with 3H:1V slopes, topsoil will be replaced at 6" <br />to 8" and the site will be revegetated with native grasses approved by the NRCS. Grazing will not begin until <br />the grasses are established to a point that the landowner, in conjunction with the Division and the local Soil <br />Conservation District/NRCS, determine is appropriate. <br />The Conditional Use Permit (SUP) for the site has been approved by Huerfano County according to Mr. <br />Gagliano. The application is in the adequacy review and public comment periods with the Division. An <br />adequacy review letter for the permit application will be sent under separate cover at the conclusion of the <br />public comment period. <br />Pre-operation inspection photographs are attached below. <br />I & E Contact Address <br />NAME Joe Gagliano <br />OPERATOR L J Development, Inc. <br />STREET 256 N. Merrill Drive <br />CITY/STATE/ZIP Pueblo West, Colorado 81007 <br />Cc: Steve Shuey; DRMS <br />cc: <br />? CE <br />? BL <br />? FS <br />? HW <br />? HMWMD (CH) <br />? SE <br />Frank Leone Jr.; Leone Sand & Gravel LLC