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June 10, 2010 <br />Annual Mining Permit Report for Shipps Farm LLC <br />Pit # M-1978-102 <br />The past year, we have reconfigured the mining area to allow crushing and <br />screening equipment to be on the floor of the mined surface. We created ramps to <br />allow trucks to load on the bottom. <br />We have not exposed any ground water and remain about four feet above <br />the static water level of the pond, east of the working pit. <br />We have excavated some of the existing high wall and enlarged the pit by <br />about eighty feet to the northeast corner of the old hole. (See map) <br />We have processed 3150 cubic yards of pit run and marketed most of the <br />existing stockpiles. <br />Please find the annual fee included and inform us of anything not included <br />in this report that needs to be. <br />Sincerely, <br />Jim Cozad - erator <br />P.O. Box 243 <br />Ault, CO 80610 <br />970-371-0490