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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 />August 24, 2010 <br />Glenn Williams <br />Cotter Corporation <br />P.O. Box 700 <br />Nucla, CO 81424 <br />6R41 <br />' MED <br />AUG 3 G 2010 <br />DIVision UI ? <br />???tdrnation, <br />Mining and Safty <br />Re: JD-6 Mine, Permit No. M-1977-310, Notice of Financial Warranty Increase, SL-01. <br />Dear Mr. Williams, <br />COLORADO <br />D I V I S I ON OF <br />RECLAMATION <br />MINING <br />SA ETY <br />Bill Ritter, Jr. <br />Governor <br />James B. Martin <br />Executive Director <br />Loretta E. Pineda <br />Director <br />In an effort to ensure the financial warranty remains adequate to reclaim this site per the requirements of the <br />approved reclamation plan, DRMS has updated the reclamation cost estimate (copy enclosed). The estimated <br />reclamation liability is now $37,900.00. This is an increase of $20,000.00 from the 2002 bond review. The site is <br />clearly is under-bonded. Per Rule 4.2.1(8) for operations having a reclamation bond with a federal land <br />management agency DRMS holds a $100.00 cursory bond for this site. Cotter must submit documentation that the <br />Department of Energy (DOE) holds sufficient bond to cover the estimated reclamation liability for this site or <br />submit the difference to DRMS by the noted date. Therefore, pursuant to Section 34-32-117(4) (C) (II) of the <br />Colorado Land Reclamation Act, proof of or adequate financial warranty must be submitted to DRMS within 60 <br />days, (October 25, 2010) of the mailing date of this notice. <br />Several tasks were not taken into account with the previous estimate that are required now. These tasks included <br />monitor well decommissioning and excavation and disposal of ore stockpile base materials which is now <br />considered a potential toxic waste. These tasks, with inflation of other factors, have facilitated a major increase of <br />the required bond. This estimate includes some costs that will be adjusted when Cotter submits the required <br />Environmental Protection Plan (EPP). However, without data that will be part of the EPP plan DRMS must assume <br />a conservative position. <br />If you need additional information, please contact me at the Division of Reclamation, Mining, and Safety, Grand <br />Junction Field Office, 101 S. 3rd St., Suite 301, Grand Junction, Colorado 81501, telephone no. 970.241.1117. <br />Sincerely, <br />G. Russell Means <br />Environmental Protection Specialist <br />Office of Office of <br />Mined Land Reclamation Denver • Grand Junction • Durango Active and Inactive Mines