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,000 <br />I'? <br />OXBOW MINING, LLC <br />3737 Hwy 133 P.O. Box 535 Somerset, Colorado 81434 USA Tel (970)929-5122 Fax <br />(970)929-5177 RECEIVED <br />APR 15 2011 <br />April 14, 2011 Division ul ku-ciarnation, <br />Mr. Mike Boulay Mining and Safes <br />Environmental Protection Specialist <br />Colorado Division of Reclamation, Mining and Safety <br />101 South 3`d, Suite 301 <br />Grand Junction, CO. 81501 <br />Re: Oxbow Mining LLC, Permit No. C-1981-022 <br />TR-70 - Vessels Coal Gas Inc. Borehole Proposal - Sanborn Creek Fansite. <br />Dear Mr. Boulay, <br />This letter is to request Technical Revision No. 70 to the Oxbow Mining LLC (OMLLC) Permit <br />No. C-1981-022. <br />The purpose of the TR-70 is to provide information to the Division about a Vessels Coal Gas Inc. <br />methane gas borehole proposal to be located at the former Sanborn Creek fansite pad area. The <br />borehole will be used to recover methane from the abandoned and sealed Sanborn Creek Mine <br />workings. <br />Recall that Vessels Coal Gas Inc. (Vessels) retains a 50% ownership position of the private gas <br />lease associated with the old Sanborn Creek Mine fansite facility. Oxbow Mining, LLC owns the <br />other 50%. We have talked on numerous occasions about Vessels' desire to develop the gas <br />resource from the abandoned Sanborn Creek Mine for beneficial use. <br />For the Division's information, located north of the fansite is Federal surface and Federal <br />minerals. Vessels has a contractual relationship with our sister company Gunnison Energy <br />Corporation (GEC) who owns that federal gas lease. Now that coal mining has ceased, the gas in <br />the mine workings belongs to the owners of the gas leases. Vessels and GEC are working <br />together to hold and develop the GEC federal gas lease along with the fee gas. To do this, <br />Vessels is permitting with COGCC for a new gas borehole to be located near the present Sanborn <br />Creek fansite utility borehole. A copy of the COGCC Application for Permit is attached. Note <br />that the Application refers to a plugging Bond Surety #8792641 which currently is required to be <br />$60,000 in Colorado. <br />Importantly, a quirk of the Federal gas leasing timing regulations dictate that a rig must be <br />located on the borehole on May3l, 2011. Vessels will be using the existing fansite pad as the <br />0 Page 1