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Mr. Allen Sorenson - August 6, 2010 <br />Page Five <br />Please be advised that AGC will (given that DRMS has stated that the spray evaporation <br />program is an allowed action component of the existing permit) commence moving forward on <br />that aspect of the program (subject to any limitations or prohibitions put forth by DWR due to the <br />consumptive use issue and/or any stipulations imposed by DRMS subsequent to receipt of this <br />request) limited to spray evaporation within the confines of the tailing impoundment. If DRMS is <br />of the opinion that AGC does not possess the ability to proceed, or DRMS requires significant <br />modification to the proposed plan, please so advise immediately. <br />AGC will not activate the Cash Mine discharge termination/dewatering program (neither through <br />capture and use in drilling activities nor direct pumping of the Cash Mine well with transfer to the <br />tailing impoundment) until such time that we have received authorization to do so from both <br />DWR and DRMS. <br />If you have any questions or require additional clarification on any aspect of the proposed <br />environmental mitigation plan, please contact me directly at (303) 985-1521. <br />Sincerely, <br />J. M. BECK & ASSOCIATES (Consultant to AGC Resources, LLC) <br />James M. Beck, P.E. <br />Principal/Mine Engineer <br />Attachments: Figure 1 <br />June 14, 2010 Analytical Results Sheets (5 Total: 3 Mine Pool; 2 Tailing Pond) <br />cc: Jeff C. Deatherage, P.E. - DWR <br />Paul C. Jones - Sovereign Management Group, Ltd. <br />Mick Montgomery - AGC <br />Mark T. Nesbitt, Esq. - AGC <br />Robert F. T. Krassa, Esq. - Krassa and Miller, LLC