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PERMIT #: P-2010-026 <br />INSPECTOR'S INITIALS: THM <br />INSPECTION DATE: January 26, 2011 <br />OBSERVATIONS <br />This inspection was a pre-operational inspection conducted by the Colorado Division of Reclamation, Mining <br />and Safety to assess the proposed Multi-Mineral RDD Lease oil shale research pilot project. The proposed <br />project is located approximately 37 miles northwest of Rifle, Colorado off of Rio Blanco County Road 24. <br />Harry Posey and John Woods with Shell Exploration and Production accompanied the inspector during the <br />inspection. <br />The proposed exploration project is located on the northeastern portion of the Colorado State University <br />research revegetative plots. The project is to only affect a small portion of the research plot and the majority <br />will be left intact according to the proposed plan. <br />The site was entirely covered with snow so existing vegetation was not observed during the inspection. The <br />NOI submitted clearly documents the vegetation that inhabit the proposed project area which consist primarily <br />of pinion and juniper woodlands and sagebrush shrubland, the most dominant species being Wyoming big <br />sagebrush. <br />Two hydrology monitoring pads were observed during the inspection. The pads are permitted under NOI No. <br />P-2009-024 but will also be used to support the Multi-Mineral RDD. <br />Photos that show the conditions observed during the inspection are included at the end of this report. <br />Responses to this inspection report should be directed to Travis Marshall at the Division of Reclamation, <br />Mining and Safety, Grand Junction Field Office, 101 South 3rd Street, Room 301, Grand Junction, Colorado <br />81501, phone no. (970) 241-2042. <br />Page 2 of 4