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Cotter respectfully disagrees with DRMS. Cotter's positions are set forth in detail in a letter <br />from Charlotte Neitzel, on behalf of Cotter, to Cheryl Linden, dated June 21, 2010, which is a <br />response to a letter dated May 21, 2010, from Loretta Pineda, Division Director, DRMS, to <br />Randy Whicker of Cotter regarding the Schwartzwalder Mine, and a Rationale for Not <br />Conducting Mine Dewatering and Mine Water Treatment at the Schwartzwalder Mine, by Susan <br />A. Wyman, P.E., P.G., Whetstone Associates, which was submitted to DRMS on June 25, 2010 <br />under cover of a letter from Charlotte Neitzel, on behalf of Cotter, to Cheryl Linden. Both of <br />these submissions on behalf of Cotter are incorporated herein by reference. <br />The operator proposes to analyze representative samples of source term material from the <br />alluvial fill to evaluate the acid or toxic-forming potential if disposed of in the Minnesota <br />adit underground disposal area. Substantially greater detail for this plan is required and <br />should be submitted as a separate Technical Revision to facilitate field work this year, or in <br />the Amendment that is due 01 August 2010, if remedial activities will not be undertaken <br />during this field season. Additional required details shall include, but are not necessarily <br />limited to, material toxicity, areas of removal, disposal plans including proper assessment <br />of options, final ground reclamation details, stream protection during ground work, <br />hydrologic barriers to prevent contamination water resources, and bonding. Material <br />toxicity and disposal location relative to hydrological interaction must also be assessed. <br />Cotter will assess any proposed source-term removal and disposal as indicated in a separate <br />Technical Revision request. <br />Item 3 <br />The proposed financial warranty unit costs are satisfactory but the total amount is <br />inadequate. In accordance with §34-32-117(4)(a) and (b) C.R.S. and Rule 4.2.1(1),(2),(3) <br />and (4), the operator must provide financial warranty sufficient to account for the cost of <br />water treatment plus the pumping required to achieve the objective stated previously in <br />Item 2 for the mine pool, for the duration of treatment. <br />Bonding <br />Personnel from the Radiation Program of Colorado Department of Public Health and <br />Environment (CDPHE) are requiring that Cotter submit a Radioactive Materials License (RML) <br />application and associated bond for water treatment activities and structures at the <br />Schwartzwalder mine. A separate and duplicative DRMS bond is not required because there will <br />be a bond in place for RML activities. <br />The activities and structures that will be bonded under the RML include reclamation of the water <br />treatment building, water treatment equipment that will be exposed to radioactive contaminants <br />during treatment (pipes, pumps and IX columns) and Ion Exchange (IX) resin media. <br />Accordingly, in the listing of assumptions and calculations below, Cotter will identify areas or <br />cost items that will be bonded under the RML. <br />2