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PERMIT #: M-2001-033 <br />INSPECTOR'S INITIALS: JLE <br />INSPECTION DATE: March 21, 2011 <br />OBSERVATIONS <br />This was a normal monitoring inspection of the Rough Cut Pit; DRMS File No. M-2001-033 operated by Rough <br />Cut, LLC. This site is located approximately 2.5 miles southwest of Manzanola, Colorado in Otero County. I, <br />Jared Ebert of the Colorado Division of Reclamation, Mining and Safety conducted the inspection. Mr. Keith <br />Tucker of Tucker Custom Services who is conducting the mining operation accompanied me on the inspection. <br />This is a 112c mining operation with a permit area of 467 acres. The permit area is split into 5 phases to be <br />mined. The current operation is located in the Phase 1 area. It appears mining began in the south central <br />portion of Phase 1 and progressed west and north. The current approved mining plan indicated only 35 acres <br />would be disturbed at a time. Based on the Division's GPS survey and a 2009 aerial photograph, the Division <br />estimated approximately 42 acres have been affected by the mining operation which is larger than what is <br />currently approved. This issue is cited as a problem at the beginning of this report and will require <br />corrective action to be taken by the Operator. The Operator will need to submit a Technical Revision to the <br />mining plan to increase the maximum allowed affected land to 42 acres or more. <br />The affected land contains one long highwall bordering the southern and western boundary of the affected <br />land. The highwall is approximately 25 feet in height and is vertical. The length of the highwall was measured <br />with a Trimble GPS unit and found to be 2,980 feet. The current approved mining plan indicated mining would <br />be done to facilitate reclamation by pushing slopes to a 3:1 horizontal to vertical ratio when practical. At this <br />time, mining is not being conducted in this manner. This issue is cited as a problem at the beginning of this <br />report and will require corrective action to be taken by the Operator. The Operator will need to grade the <br />highwall to the required 3:1 slope and provide photographic documentation to the Division that the work has <br />been completed by the corrective action date. Or, the Operator could submit a Technical Revision to the <br />mining plan to update the mining method to account for the vertical highwalls. <br />A large amount of material and waste rock stockpiles are located along the southern boundary of the <br />excavation. Some of this material could be used to reclaim the large highwall. Topsoil is stockpiled in several <br />places at the site. One long pile is located above the highwall along the southern boundary of the affected <br />land. Two additional topsoil stockpiles are located in the north central portion of the affected land. The <br />remaining portion of the affected land contains various processing and mining equipment and a scale. One <br />long haul road enters the site from the east. <br />The mine entrance sign was in place and the affected land was marked with white poles. The Division <br />evaluated the current financial warranty amount and determined it is adequate at this time. A map of the <br />Division's findings is enclosed with this report. <br />In regards to the Technical Revision to update the approved mining plan. The Technical Revision will need to <br />include: <br />1.) A request to increase the maximum allowed affected land to at least the current 42 acres. However, <br />the Operator will need to consider if additional land is needed for future operations at this time. Prior <br />to affecting additional land beyond what is requested, the Operator will need to conduct reclamation <br />on a portion of the affected land no longer needed for the operation and obtain Division approval of <br />the reclamation conducted. <br />Page 3 of 8 <br />