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o..co?o COLORADO DIVISION OF RECLAMATION, MINING AND SAFETY <br />MINERALS PROGRAM INSPECTION REPORT <br />PHONE: (303) 866-3567 <br />1876 * <br />The Division of Reclamation, Mining and Safety conducted an inspection of the mining operation noted <br />below. This report documents observations concerning compliance with the terms of the permit and <br />applicable rules and regulations of the Mined Land Reclamation Board. <br />MINE NAME: MINE/PROSPECTING ID#: MINERAL: COUNTY: <br />Varra Resources Project 110 M-1984-036 Sand and Gravel Weld <br />(formerly Dakolios Pit No. 1) <br />INSPECTION TYPE: INSPECTOR(S): INSP. DATE: INSP. TIME: <br />Pre-Operation Inspection Peter S. Hays May 20, 2011 09:00 <br />OPERATOR: OPERATOR REPRESENTATIVE: TYPE OF OPERATION: <br />Varra Companies Inc Chris Varra, Garrett Varra and Brad Janes 112c - Construction Regular Operation <br />REASON FOR INSPECTION: BOND CALCULATION TYPE: BOND AMOUNT: <br />Normal I&E Program Complete Bond $87,200.00 <br />DATE OF COMPLAINT: POST INSP. CONTACTS: JOINT INSP. AGENCY: <br />N/A None None <br />WEATHER: IN GNATURE: SIGNATURE DATE: <br />Clear May 24, 2011 <br />GENERAL INSPECTION TOPICS <br />This list identifies the environmental and permit parameters inspected and gives a categorical evaluation of each. No problems <br />or possible violations were noted during the inspection. The mine operation was found to be in full compliance with Mineral <br />Rules and Regulations of the Colorado Mined Land Reclamation Board for the Extraction of Construction Materials and/or <br />for Hard Rock, Metal and Designated Mining Operations. Any person engaged in any mining operation shall notify the office <br />of any failure or imminent failure, as soon as reasonably practicable after such person has knowledge of such condition or of <br />any impoundment, embankment, or slope that poses a reasonable potential for danger to any persons or property or to the <br />environment; or any environmental protection facility designed to contain or control chemicals or waste which are acid or <br />toxic-forming, as identified in the permit. <br />RECORDS----------------------------------- Y (FN) FINANCIAL WARRANTY-------- Y (RD) ROADS----=------------- Y <br />HYDROLOGIC BALANCE------------- Y (BG) BACKFILL & GRADING---------- Y (EX) EXPLOSIVES--------- NA <br />PROCESSING WASTE/TAILING---- Y (SF) PROCESSING FACILITIES------- Y (TS) TOPSOIL---------------- Y <br />GENL MINE PLAN COMPLIANCE- Y (FW) FISH & WILDLIFE----------------- Y (RV) REVEGETATION---- Y <br />SIGNS AND MARKERS----------------- Y (SP) STORM WATER MGT PLAN---- Y (SB) COMPLETE INSP---- Y <br />OVERBURDEN/DEV. WASTE--------- NA (SC) EROSION/SEDIMENTATION--- Y (RS) RECL PLAN/COMP-- Y <br />T) ACID OR TOXIC MATERIALS------- NA (OD) OFF-SITE DAMAGE ---------------- Y (ST) STIPULATIONS------- Y <br />Y = Inspected and found in compliance / N = Not inspected / NA = Not applicable to this operation / PB = Problem cited / PV = Possible violation cited <br />Page 1 of 4