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(Page 3) <br />MINE ID # OR PROSPECTING ID # M-1979-181 <br />INSPECTION DATE 5/27/10 <br />INSPECTOR'S INITIALS RCO <br />A piece of diesel-powered mining equipment parked near the upper portal was observed to be leaking oil, and had been <br />leaking for some time. The two oil pans underneath and the absorbent blanket had all collected their capacity of oil. A <br />small amount of soil under the blanket was also stained by oil. This was indicated to the operator, who was also advised <br />to remove the equipment: from the site, repair it or place it where all leaks would be captured. The contaminated materials <br />must all be removed and properly disposed of. Due to the limited scope of the leak, this is not a problem at this time. If <br />this same issue is observed at a future inspection, indicating that the repair or removal did not occur, or that the clean-up <br />did not occur, this will become a problem. <br />The site receives surface water runoff from several upland sources, most of which is captured or conveyed across the site <br />adequately. However, due to numerous snow-plowing events during the past winter that may have eliminated or <br />compromised water bars, ditches or catchments, the operator should check and ensure that all stormwater structures are <br />in place and fully functional. Offsite sediment transport must be avoided. <br />The bond will be reviewed and recalculated later as part of finalizing this amendment. For now it is considered adequate. <br />No further items were observed during the inspection. Responses to this inspection report should be directed to this <br />inspector at the Division of Reclamation, Mining and Safety, 691 County Road 233, Suite A-2, Durango, Colorado 81301. <br />(Please note: As of 7/1/08 the Durango Field Office moved to the new address, shown above. Please revise your <br />records as necessary.) <br />I & E Contact Address cc: Steve Shuey, DRMS <br /> ? CE <br />NAME Keith Emmett ? BL <br />OPERATOR _Mount Sneffels Mining Company LLC ? FS <br />STREET .318 South Scenic Hwy. Suite 104 ? HW <br />CITY/STATE/ZIP Lake Wales. FL 33853 ? HMWMD (CH) <br /> ? SE <br /> ? WQCD (CH) <br /> ? OTHER <br />Cc: Karmen King, Grayling LLC,18050 Rd G, Cortez, CO 81321