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(Page 4) <br />MINE ID # OR PROSPECTING ID # <br />INSPECTION DATE 7 /20/99 <br />INSPECTOR'S INITIALS WHE <br />4. Potential for adverse impact to the hydrologic balance may exist due to the pyritic content of the low <br />grade ore and waste rock material, which has been placed in contact with surface waters. Please review <br />Rules 3.1.5(5), 3.1.5(10) and 3.1.6(1). DMG identified the issue of waste rock materials being placed in direct <br />contact with surface drainage, as a Problem in its 8/28/97 inspection report. Evidence of compliance with <br />the corrective actions of DMG's 8/27/97 inspection report was not observed. <br />CORRECTIVE ACTION: Within 30 days, by August 26, 1999, complete one of the following two options: <br />(a) remove waste rock and /or low grade ore material from direct contact with surface drainage; OR <br />(b) demonstrate that the waste rock /low grade ore material does not contain acid- forming or toxic producing <br />materials, does not have potential for unauthorized release of pollutants to the surface and groundwater <br />systems, and that the operator has minimized disturbances to the prevailing hydrologic balance. Such <br />demonstration will include an appropriate laboratory analysis of the stockpiled material to determine the acid <br />and metals generating potential. 8/26/99 <br />PV or PB PB <br />TOPICS MP, RS, HB, ES, BG, AT. OD, FW <br />Enclosure: DMG 7/21/99 reclamation cost estimation <br />CERTIFIED MAIL NO. Z 443 190 278 <br />Return Receipt Requested <br />