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PERMIT #: M-1977-215 <br />INSPECTOR'S INITIALS: RCO <br />INSPECTION DATE: May 20, 2011 <br />OBSERVATIONS <br />This was a partial inspection performed by the Division as part of its routine monitoring of active Hard <br />Rock/Metals permitted mines. The permit is in "Active" status, as of the 2008 approval of TR-13, but no <br />operations are currently underway. The operator has contacted this office and the Forest Service recently <br />regarding applying for permit changes for re-commencing mining and milling in the future. Specifically, <br />discussions have involved new portal location, groundwater quality and quantity (mine pool), facilities and <br />tailings pond locations, etc. Since the location for a new portal would likely be near the former 9360 portal <br />location, this inspection was aimed at examining that area. The initial set of surface disturbances associated <br />with establishing a new portal could include access road, waste rock disposal area, electrical power supply, <br />dewatering the mine pool, and piezometer development for sampling mine pool. These activities may be <br />located on patented claim land or on USFS-managed land. The operator is aware that no development may <br />occur without the Division's approval. Depending on the scope of any of the changes applied for, these might <br />be technical revisions or amendments to the permit. At some point in the process of updating the permit to <br />allow future mining and milling operations, the operation would fit the definition of a DMO (Designated <br />Mining Operation), and the operator would be required to develop an EPP (Environmental Protection Plan). <br />These are discussed in Hard Rock/Metals Rule 6.4.21 and Rule 7, which the operator is encouraged to become <br />familiar with. <br />The office building is still present, and the operator may build more structures in this area. Presently the <br />operator's prospect drilling supplies are stockpiled near the building, and they are adequately stored. <br />Backfilling and Grading: <br />The surface grading on the site was performed several years ago, and much of it meets the standards of final <br />reclamation. The site is stable, with good drainage control, no observed erosion, no seeps, no debris, and no <br />contamination. <br />Financial Warranty: <br />The financial warranty was recalculated a few years ago for TR-14, and it is still considered adequate. When <br />some form of future activity is approved the bond will be reviewed. <br />Revegetation: <br />The operator is adequately monitoring and treating noxious weeds on the permitted area, under the revised <br />weed control plan, approved under TR-15. The weed control should continue throughout the life of the <br />permit. <br />As future plans for the site are formed, the operator should contact this office regarding any necessary <br />documentation, formal permit revisions, or inspections to be performed. All activities carried out should be <br />included in the annual reports. <br />For questions regarding this report please contact the inspector at the Division's Durango Field Office: <br />DRMS <br />691 CR 233, Room A-2 <br />Durango, CO 81301 <br />Tel: 970-247-5193 <br />Page 2 of 3