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(Page 3) <br />MINE ID # OR PROSPECTING ID # M-2006-069 & M-2010-003 <br />INSPECTION DATE 6/3/10 INSPECTOR'S INITIALS WHE <br />concentrate road drainage and convey that drainage to the slope of the unstable fill material. The Office <br />understands that the Operator may have constructed the water bar as an attempt to minimize saturation of the <br />unstable fill material. However, as shown in photos one through seven, the Operator has not provided a safe <br />means of conveying road drainage down the unstable slope. The Operator has not repaired and/or replaced the <br />failing sediment control structures. The Office had previously directed the Operator to repair/replace the storm <br />water controls prior to the geotechnical reconnaissance work. Observations made during the inspection and <br />recorded in this report indicate that this was not done. <br />Discharge from Idaho Mine Permit Area - See photos ten and 11. The application identifies a seep or spring <br />associated with the collapsed Idaho portal. The spring is located immediately down slope from the collapsed <br />portal and appears to be mine drainage from the historic portal. Flow was visually estimated at eight feet wide <br />and two inches deep. Speed of flow was estimated at one foot per second. Visual estimate of flow was <br />approximately one cubic foot per second. <br />Application Denied for Idaho Mine (M-2010-003)-As noted above, the Cease and Desist Order for Violation MV- <br />2009-033 reiterates that the illegal road cannot be utilized to support mining activities until the Operator <br />incorporates the road into an approved reclamation permit. The Board ordered the Operator to secure such <br />permit within 180 days, due June 8, 2010. The Board later extended this deadline one day, to June 9, 2010. <br />On May 7, 2010, the Operator filed a 110(2) application for the Idaho Mine, M-2010-003. Through the permit <br />application the Operator attempted to address the corrective actions of Violations MV-2009-007 and MV-2009- <br />033. The Office set a June 7, 2010 decision date for the application. The decision date was extended one day, to <br />June 8, 2010, by request from the Operator. On the decision day, on June 8, 2010, the application failed to <br />demonstrate compliance with the minimum requirements of the Act, Rules and Regulations. Accordingly, on June <br />8, 2010, the Office denied the application. <br />The Operator has submitted a petition for appeal of the Office's decision to deny the application. The hearing <br />date for the appeal has not yet been determined. Notice of the hearing date will be forwarded to all individuals <br />who submitted timely comment or objection to the application and to the public by newspaper publication, in <br />accordance with the public notice requirements of the Act, Rules and Regulations. <br />Forfeiture of Financial Warranty for Idaho Mill (M-2006-069) - Due to the Operator's failure to comply with the <br />corrective actions of Violations MV-2009-007 and MV-2009-033, during the June 9, 2010 Board hearing, the Board <br />ordered the Office to commence forfeiture proceedings forthe $56,233 financial warranty held forthe Idaho Mill, <br />M-2006-069. The forfeiture hearing is scheduled for July 12, 2010. <br />Response to this inspection report should be directed to the Division's office in Durango at 691 County Road 233, <br />Suite A-2, Durango, CO 81301, to the attention of Wally Erickson, phone (970) 247-5469. <br />I & E Contact Address <br />NAME Mike Clements <br />OPERATOR Wildcat Mining Corporation <br />STREET 108 Linda Court <br />CITY/STATE/ZIP Durango. CO 81301 <br />cc: Steve Shuey, DRMS <br />? CE <br />? 131 <br />? FS <br />X David Linden, complainant <br />X Lisa Giovanniello, citizen <br />X Marianna Spishock, La Plata County