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GCC GCC Energy, LLC <br />Telephone: 970.385.4528 6473 County Road 120 <br />Energy "Safety asa Value' Facsimile: 970.385.4638 Hesperus, CO 81326 <br />January 21, 2011 <br />State of Colorado <br />Division of Reclamation, Mining & Safety <br />1313 Sherman Street, Room 215 <br />Denver, Colorado 80203-2273 <br />Attn: Tom Kaldenbach, Reclamation Specialist <br />Re: King II Mine <br />Pond Quarterly Inspection <br />4th Quarter 2010 <br />Dear Mr. Kaldenbach, <br />An inspection of the pond at the King II mine was performed on October 6, 2010 for <br />the 4th quarter of 2010. The pond was dry. The pond embankment, in-slopes and <br />spillway all appeared stable with no evidence of slumping, settling or excessive <br />erosion. All features appeared to be in place and functioning as designed. <br />Please call Tom Bird at (970) 385-4528 x 6503 if you have any questions or comments. <br />Sincerely, <br />i <br />Tom Bird <br />Manager, Coal Services <br />GCC Energy, LLC