2011-04-06_PERMIT FILE - X201123102

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limited to, a water truck, pipe truck and/or pipe trailer, rig-up truck, air compressor, core trailer, and two or three 4 x 4 pickups for the drill-crew and company representatives. For each drillhole, a short section (typically 40-60 feet) of threaded surface casing will be set to stabilize unconsolidated surface materials. Drillholes will be a nominal 6.25 inches in diameter and will vary in depth from approximately 400 to 1,900 feet. The anticipated total depth for each drillhole is identified in Table 2, 2011 Drillhole Specifications. It is anticipated that the Wadge coal seam and associated roof and floor units will be cored in each drillhole. If other coal seams of interest are penetrated (e.g., Lennox or Sage Creek) they may be cored, as well. Cores will be recovered, examined and logged by a qualified geologist, and core samples may be sent-off for analysis of coal and roof/floor chemistry and characteristics and rock-strength parameters. It is anticipated that the majority of drillholes will extend approximately 70 feet below the Wadge coal seam; most likely they will not extend into the Wolf Creek coal or underlying Trout Creek Sandstone. The primary circulation medium will be water and drilling mud. In the event that subsurface conditions are favorable, air or an air/foam medium may be utilized, as an alternative to mud. Water for drilling will be obtained from stock ponds located on surface controlled by Peabody/PSCM. Drilling contracts will specify that only non-toxic, bio-degradable compounds and additives may be used for drilling muds. At this time PSCM does not anticipate "twinning" any of the drillholes. However, if "twinning" of any drillhole becomes necessary, PSCM will not "twin" any drillhole until an application for an amendment to the NOI for "twinning" is submitted to and approved by the CDRMS in accordance with Rules 2.02.2(2)(g) and 3.05.2. Geophysical Logging: On completion of drilling and core recovery, geophysical logging will be.completed for each drillhole to obtain additional geologic information. A truck- mounted geophysical logging unit will be used to obtain, correlate, and store logging information which may include density, gamma, caliper, neutron, focused electric, sonic, verticality, temperature, and conductivity. PSCM will retain in its files all drill and geophysical logs for at least one year, and will make them available for inspection by an authorized Division representative. Exploration Maintenance Activities: Other than initial road maintenance to establish good access, it is anticipated that access road maintenance requirements will be minimal, since the majority of the exploration efforts will occur during the dry summer months. Other maintenance requirements will include general housekeeping in active exploration areas and regular inspection and maintenance (as necessary) of drainage structures. Monitoring or Water-Supply Well Completion- At this time PSCM does not anticipate converting any exploration holes to monitor wells. If it is decided to convert an exploration hole to a monitor well authorization will be obtained from the appropriate regulatory authority(s) in compliance with applicable provisions of 43CFR 3484.1(a) and 37-92-602, C.R.S. In addition, the Colorado Division of Water Resources will be notified in accordance with Rule 5.2.31 (2 CCR 402-2) prior to converting the drill hole to a monitor well. Proposed Reclamation Methods: The proposed exploration program is designed to minimize new surface disturbance by utilizing existing roads and trails to the extent possible, placing drill pads adjacent to existing roads, utilizing previously disturbed areas for drill pads, and limiting pad size. Surface disturbance, and reclamation requirements and costs PSCM 2011 NOI 16 April 2010