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SUMMARY
<br />Current Operational Status
<br />McClane Canyon Mine is currently an inactive underground coal mining operation. On February
<br />15, 2011 the Division received notification from McClane Canyon Mining, LLC that the
<br />McClane Canyon Mine is in temporary cessation and will likely remain in that status for a year
<br />or more. The mine went into temporary cessation because its only customer, the Cameo Power
<br />Plant closed at the end of December, 2010. McClane Canyon Mining, LLC has submitted the
<br />appropriate information required by Rule 4.30 and has modified the mine identification sign to
<br />include the Division office contact information where the mining and reclamation permit is filed.
<br />When the mine is operating coal it is mined underground using room and pillar techniques.
<br />Maximum annual coal production is 500,000 tons, with a projected production of 300,000 to
<br />500,000 tons per year. The mine area encompasses 2,560.5 acres, of which 1,901.3 acres are
<br />projected to be affected by mining. Permitted surface disturbance is 17.65 acres.
<br />Permitting History
<br />Initial site development work at the McClane Canyon Mine was conducted under a USGS
<br />approved exploration plan effective December, 1976. The Colorado Mined Land Reclamation
<br />Division (now the Colorado Division of Reclamation, Mining and Safety) issued a three year
<br />permanent regulatory program permit on April 6, 1982, for a 248 acre permit area. The existing
<br />access/haul road and the portal bench face-up developments were in place prior to issuance of
<br />the 1982 permit, and no topsoil had been salvaged from these areas. This permit was renewed on
<br />July 5, 1985, for an additional three year permit term. The mine was in temporary cessation
<br />from January 17, 1984 to November 17, 1988, when coal production was resumed. On January
<br />27, 1992, the permit was renewed for a five year term.
<br />The 1992 renewal incorporated a permit revision which added 2,312 acres to the permit area, and
<br />proposed construction of a haul road which would connect the McClane Canyon permit area to
<br />the adjacent Munger Canyon permit area, (both mines are operated by the same permittee). There
<br />were relatively brief periods of coal production between 1992 and 1999, but for much of this
<br />time the operation was in temporary cessation. On March 3, 1993, the Division approved a
<br />permit transfer from Salt Creek Mining Company to Grand Valley Coal Company (GVCC). On
<br />December 31, 1996, the Division approved a permit renewal (RN-04) for a new five year term,
<br />expiring July 6, 2001.
<br />On August 17, 1999, the Division approved a permit transfer from GVCC to Lodestar Energy, Inc.
<br />(LEI). On December 1, 1999, operational status was officially changed from temporary cessation
<br />to active. LEI initiated coal extraction operations at the mine the week of February 21, 2000, and
<br />active operations have continued to the present time (November 2006) under LEI and CAM
<br />Mining LLC, the current permittee. To date, coal produced at the mine since operations resumed
<br />in 2000 has been trucked to the Xcel Energy Cameo Power Plant near Palisade, Colorado.
<br />LEI filed for bankruptcy on March 30, 2001, and operated the mine for a period of time as a debtor
<br />in possession. In May 2003, certain LEI assets including the McClane Canyon operation were
<br />acquired via bankruptcy auction by Central Appalachia Mining, LLC (now CAM Mining Inc.)
<br />(CAM). On June 26, 2003 the Division received an application for Succession of Operators (SO-
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