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STATE OF COLORADO <br />DIVISION OF RECLAMATION, MINING AND SAFETY <br />Department of Natural Resources <br />1313 Sherman 5t., Room 215 <br />Denver, Colorado 80203 <br />Phone. (303) 866 -3567 <br />FAX: (303) 832 -8106 <br />COLORADO <br />DIVISION OF <br />RECLAMATION <br />MINING <br />SAFETY <br />John W. Hickenlooper <br />Governor <br />May 2 2011 Mike King <br />� Executive Director <br />Loretta E. Pinede <br />James A. Kiger Director <br />Environmental Manager <br />Oxbow Mining, LLC <br />P.O. Box 535 <br />Somerset, CO 81434 <br />Re. Elk Creek Mine, Permit No. C -1981 -022, Oxbow Mining LLC ( OMLLC) <br />Technical Revision No. 70 (TR -70) - Adequacy Review <br />Vessels Coal Gas Inc. Borehole Proposal - Sanborn Creek Fansite <br />Dear Mr. Kiger: <br />The Division of Reclamation Mining, and Safety (Division) has reviewed the above referenced <br />technical revision application materials submitted for a Vessels Coal Gas Inc. methane gas <br />borehole proposal. The methane gas borehole would be located at the former Sanborn Creek <br />fansite pad within OMLLC's permit area. The borehole would be used to recover methane from <br />the abandoned and sealed Sanborn Creek Mine workings. Vessels would be using the existing <br />fansite pad as the drilling pad and no additional disturbance is proposed. The associated <br />disturbances (drill pad area and access road) are already part of the approved and bonded Elk <br />Creek Mine disturbance area. OMLLC has provided a copy of a Colorado Oil & Gas <br />Conservation Commission (COGCC) Application for Permit to Drill and has indicated that <br />COGCC is requiring a bond in the amount of $60,000.00 for plugging and abandoning the hole. <br />This would be more than sufficient to cover the cost for plugging and abandoning and the Division <br />will not require additional bond for that purpose but will require documentation of the permit to <br />drill and bond instrument. The Division has the following adequacy review comments regarding <br />the proposed plan. <br />1. Please provide a well completion diagram for the proposed methane gas borehole. <br />2. The Division will need documentation that Vessels has been issued a pen to drill from <br />the COGCC. Drilling cannot commence until the permit has been issued. Please forward <br />a copy of the permit once it has been retained. <br />3. Please provide documentation of the bond for this borehole. The Division will need to be <br />informed of OMLLC's plans for any additional boreholes to be drilled within the Elk <br />Office of Office of <br />Mined Land Reclamation Denver • Grand Junction • Durango Active and Inactive Mines <br />