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May 24, 2011 C-1981-019/Colowyo Coal Mine JHB Inspection Topic Summary NOTE: Y=Inspected N=Not Inspected R=Comments Noted V=Violation Issued NA=Not Applicable Y -Air Resource Protection R -Roads R -Availability of Records N -Reclamation Success Y -Backfill&Grading R -Revegetation Y -Excess Spoil and Dev. Waste NA - Subsidence R -Explosives R - Slides and Other Damage Y -Fish&Wildlife R - Support Facilities On-site R -Hydrologic Balance Y - Signs and Markers Y -Gen. Compliance With Mine Plan NA - Support Facilities Not On-site R -Other NA - Special Categories Of Mining NA -Processing Waste R -Topsoil COMMENTS This was a complete inspection conducted by Janet Binns of CDRMS. The first portion of the inspection was conducted as a Special Focus inspection with inspectors from the Office of Surface Mining(OSM)Denver Field Division. OSM personnel included;Howard Strand,Elizabeth Schaeffer, and Bobbi Martinez Hernandez. Tony Tennyson of Colowyo Coal Company accompanied the inspection and represented the operator. Special focus topics included Topsoil Storage and protection,and Blasting notifications. OSM personnel accompanied the inspection on Tuesday, leaving at 2pm Tuesday afternoon. The Division continued with the rest of the inspection Tuesday, Wednesday and finishing up on Thursday morning,5/26/2011. The mine is an active surface mine,with two active pits;West Pit and South Taylor Pit. A third pit,East pit, is currently idle. The East Pit has reached its southern limit and the remaining highwall remains to be reduced and graded to approved post-mining contours. The weather was warm and varied between cloudy and rainy on the first day of the inspection to sunny and warm the second day of the inspection. Temperatures were mild. Area rivers and creek are bank full or overtopping their natural drainage channels. Snowpack has melted off the mine site. AVAILABILITY OF RECORDS—Rule 5.02.4(l): Records were checked in the mine office. Availability of records form accompanies this report. CCC provided DRMS copies of approved page distribution letters to BLM and OSM for MRI07&TR90. EXPLOSIVES— The OSM Special Focus Inspection included evaluation of Rule 4.08.3: Public Notice of Blasting Schedule. Records are stored in the environmental office. Colowyo conducts blasts regularly and often daily depending on the mining progress. Annual written notifications are sent to nearby residents, owners of dwellings, and other pertinent parties in January each year with the annual blasting information, and information on how to contact the operator. Annual blasting plan is also published in the Craig Daily Press and Meeker Herald in January each year. This is in accordance with Rule 4.08.3(l)and(2). Number of Partial Inspection this Fiscal Year: 8 Number of Complete Inspections this Fiscal Year: 4 Page 2 of 12