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STATE OF COLORADO <br />DIVISION OF RECLAMATION, MINING AND SAFETY <br />Department of Natural Resources <br />1313 Sherman St., Room 215 <br />Denver, Colorado 80203 <br />Phone: (303) 866-3567 <br />FAX: (303) 832-8106 <br /> <br />August 20, 2010 <br />Karmen King <br />Grayling LLC <br />18050 Rd. G <br />Cortez, CO 81321 <br /> COLORADO <br /> D I V IS I ON OF <br /> RECLAMATION <br /> MINING <br /> <br /> SAFETY <br />RECEIVED <br /> Bill Ritter, Jr. <br />AUG 2 3 20110 Governor <br /> James B. Martin <br />Division of Kutac:u,sation Executive Director <br />, <br />Unin9 and Safety Loretta E. Pineda <br /> Director <br />Re: Ruby Trust Mine, Permit No. M-1979-181, Amendment AM-1, Second Adequacy Review Letter. <br />Dear Ms. King, <br />On August 11, 2010, the Division of Reclamation, Mining and Safety received the adequacy responses that addressed the <br />Division's adequacy review letter, dated June 28, 2010, for the permit amendment named above. The decision date for <br />the amendment application was extended to August 23, 2010. Technical review of the amendment adequacy responses <br />has revealed a few items that must still be addressed before it can be considered adequate for approval. All issues that <br />still remain to be addressed are included in the list below. Please respond to each of the following items. <br />Exhibit C - Mining Plan (Rule 6.3.3) <br />There will be a significant amount of waste rock generated during mine development, and you have provided a map and <br />description of the temporary stockpile locations. Due to the limited storage capacity on the permit area, however, only <br />about 30-days' worth of waste rock can be stored there. You provided a copy of a new agreement with Ouray County <br />Road and Bridge, to provide them with clean waste rock on a regular basis. That agreement does not obligate the county <br />to take or receive the waste rock, so if the waste rock storage capacity is reached, the operation could conceivably have to <br />cease temporarily. All waste rock to be removed from the site will tested and found inert, according to your plan. The <br />waste rock is not approved to be removed from the site under any conditions other than for county use, or stockpiled in <br />county-designated and approved stockpile locations. Please state that you acknowledge these facts. <br />The proposed snow shed structure drawings appear adequate, though the Division did not perform an engineering <br />analysis. The snow shed appears to require a county building permit, however, and a part of that requires an engineering <br />certification. Please forward a copy of the permit to the Division when it is obtained, so that we can document the local <br />government approval for it. If at all possible, please provide documentation of any local government approval to allow <br />the snow shed to remain as a permanent structure. This will ultimately affect the reclamation bond amount. (Providing <br />these items does not impact the adequacy or the decision date.) <br />The underground repository of the milled, sub-grade ore (hereinafter called "tailings") is described as a fairly dry, non- <br />mineralized crosscut, driven on a slight incline. The tailings will be slurried to the far end of the crosscut, and filled from <br />back to front. As they passively dewater, the water will flow to the impermeable bulkhead liner, otherwise considered to <br />be a coffer dam, where it will be collected and pumped back to the mill. Such collection requires that the geotextile liner <br />be flexible enough to conform to the ribs and floor of the crosscut and that those surfaces are conducive to obtaining an <br />adequate seal. Additionally, as water collects, its weight will increasingly press upon the liner. It is imperative that the <br />wooden bracing be structurally adequate to withstand the pressure, that the liner be adequately anchored to the bracing, in <br />the event that the volume is not monitored or pumped down. Please describe the method(s) of anchoring and sealing the <br />liner and bulkhead bracing. If possible, please provide the name(s) and specs of the proposed liner material(s). <br />Office of Office of <br />Mined Land Reclamation Denver • Grand Junction • Durango Active and Inactive Mines