2011-02-15_REVISION - C1980004 (2)

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Corey Heaps McClave Canyon Mining, LLC February 15, 2011 Page 2 2. MCM provided a two page update in Appendix A for the legal owner of record and the purchaser of record, but no other information was provided. Please update the ownership and control section of the permit application package (PAP) since it has not been updated since 2007. An AVS evaluation shows one violation which is linked to Rhino Energy, LLC. The violation is a Kentucky state cessation order for Deane Mining, LLC. Rule 2.03.6 Right of Enqy and Operation Information 3. MCM indicates in the cover letter to PR -2 that documentation of right -of -entry for the lease modification area will be provided at a later date and that documents in Appendix C demonstrate right of entry. On December 2, 2010 we received a letter from the Bureau of Land Management (BLM) stating that Rhino Energy LLC submitted a complete proposed action to expand coal mining operations at the McClane Canyon Mine on four previously issued Federal Coal Leases, COC- 66514, C- 0125439, C- 01225515, and C- 0125516. BLM also states that they have not given an approval for the proposed mine expansion and are currently working on an Environmental Assessment analyzing the impacts that would result from the project. BLM is now preparing the EA and could issue a Decision Record sometime in July, 2011 (see enclosed letter from BLM provided in Attachment 1.) The Division cannot issue a proposed decision on PR -2 until the pending Iease modification and right-of-way are secured from the BLM and the PAP has been updated accordingly. Rule 2.04.4 Cultural and Historic Resource Information 4. Consultation under Section 106 of the National Historic Preservation Act for this project has not been completed by the Federal agencies that are involved. Please refer to the enclosed comment letter from the Colorado Historic Society /State Historic Preservation Officer dated December 10, 2010 provided in Attachment 2. The letter is from the State Historic Preservation Officer to Ms. Aline LaForge, Archeologist with BLM and requests clarification on several items. This letter is provided for your information and MCM may be able to assist in clarification of the items identified by SHPO. Rule 2.04.6 Geology Descri tion 5. There is a typographical error on page 2.04 -11. In the first paragraph the reference to 30 CR 783 should be changed to read 30 CFR 783. 6. On page 2.04 -13 there is a typographical error. In the second sentence of the first paragraph "dept of the coal scam" should be changed to "depth of the coal seam ". 7. Many of the important geologic maps were not updated to reflect the lease modification and expansion of the permit area proposed with PR -2. Please revise and update figures 2.1 -5, 2.1 -6, 2.1 -7, 2.1 -8, and 2.1 -9 with the additional required information for the permit expansion area. Also, on Figure 2.1 -8 of the PR -02 submittal, please add the topographic contours and the mine plan sequence for comparison purposes so that the overburden thickness relative to proposed underground workings can be accurately determined.