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PERMIT #: M-1980-055-HR <br />INSPECTOR'S INITIALS: RCO <br />INSPECTION DATE: April 20, 2011 <br />OBSERVATIONS <br />This was a routine inspection performed by the Division as part of its monitoring of 112d permits, and also to <br />inspect the proposed location of an Environmental Protection Facility: the lined ore pad. The site was not <br />active on the date of the inspection. The entrance gate was locked, the building was secured, the portal was <br />backfilled and secured with a locked grate, fluids and ore were removed from the surface, and all equipment <br />was gone. <br />Backfilling and Grading: <br />The portal was backfilled to prevent unauthorized entry. The waste rock pad was graded smooth and <br />contained a berm around the crest to contain stormwater. The waste rock slope is stable for the present time, <br />but has not been graded to its approved final gradient. <br />Financial Warranty: <br />The permit is currently being amended (AM-1) and the bond will be recalculated when the amendment is <br />finalized. At this time the bond is considered adequate. <br />Hydrologic Balance: <br />There was no impounded stormwater on the pad, which is composed of sandstone. There was no evidence of <br />seeps along the toe of the waste dump or in the gulches below the dump. <br />The present amendment requires a monitoring well to be installed downgradient from the portion of the <br />present underground workings where groundwater is known to have existed. Recent discussions have <br />included the possible re-location of the proposed location of required well. A likely new location of the <br />proposed well was inspected on the south side of the ridge, along the southern edge of the permitted area. It <br />would appear appropriate since it is within the permit boundary, easily accessible from the existing county <br />road, and above the proximity of the estimated mine pool. There was no present surface disturbance in that <br />area. <br />Gen. Compliance With Mine Plan: <br />The site was cleaned up and stabilized as part preparing for the current period of inactivity. Debris and other <br />various items on the pad were removed. There were still several mining-related items stored on the pad, <br />including steel support framing and sections of fiberglass ventilation ductwork. Overhead electrical service is <br />still present to the building and portal. A hypalon-membrane lined containment structure (probably for fuel <br />tanks) was noted near the building. The liner appeared to be intact since it has impounded precipitation <br />recently. There was no tank on the liner presently. <br />The northern portion of the existing waste rock pad is where the proposed lined ore pad will be located. It is <br />level and allows equipment maneuvering room around it. <br />The affected area acreage was expanded recently, mainly to allow the waste rock dump to grow toward the <br />north. It has not been expanded yet. The new boundary markers were observed down on the juniper flats <br />below the dump, showing that there is significant area to expand the dump. Note: the operator must carefully <br />salvage and protect as much topsoil from the expansion area as possible. <br />Page 2 of 4