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• DIRECT SHEAR TESTING Where there is potential for off -site impacts due to failure of any geologic structure or constructed earthen facility...the Applicant shall demonstrate through appropriate geotechnical and stability analyses that off -site areas will be protected with appropriate factors of safety incorporated into the analysis. o Our factors of safety are based upon conservative estimates of the onsite soil and rock strength as described in SLOPE STABILITY, and indicate the planned embankment will be stable. SITE GEOLOGY AND GEOLOGIC HAZARDS Geologic mapping by the United States Geological Survey (USGS) indicates that the property is underlain by alluvium. Our subsurface investigation encountered material consistent with this interpretation. The surface and near surface soils are vulnerable to erosion especially from concentrated flows. The Civil Engineer should address control of surface drainage. Faults are mapped in the Leadville area. A map published by the Colorado Office of Emergency Management in 1999 shows the most recent movement of the faults occurred in the late to middle Quaternary (130 thousand to 750 thousand years ago) The area is considered by the 1997 Uniform Building Code (UBC) as Zone I, its least active zone designation. The soil is not expected to respond unusually to seismic activity. We did not identify any geologic hazards at the site that would preclude the proposed tailings pond and embankment. As part of our investigation, we performed direct shear testing. The testing was conducted on samples from the mill tailings you provided as well as on samples from the stockpile. The results of this testing are given in Appendix B and summarized in Table A. The material that will be placed adjacent to the embankment within the pond will be cycloned tailings. We were given a typical sample considered to be consistent with future mill tailings. A gradation analysis was performed on this sample and contained a minus 200 fraction of about 50 percent. Based upon information in Vick', single -stage cycloning reduces the minus 200 fraction of the tailings by about 30-40% We attempted to duplicate this reduction on the sample used in the direct shear test. The gradations for the tailings sample are shown in Appendix A on Figure A-4. Our attempt to match the cycloning reduction for the minus 200 fraction achieved a 12 % reduction. Additional tests are in process with a higher reduction. The results of the direct shear testing are shown in Table A. We performed testing on the stockpile material to provide an indication of the strength of the native soils and proposed embankment. The tests were done at natural moisture (6 %) and relatively low density (105 pcf) and near optimum moisture content and 95 1 "Planning, Design, and Analysis of Tailings Dams" by Steven G. Vick, 2 Printing, 1990 THE UNION MILLING COMPANY TAILINGS POND EMBANKMENT AND FUTURE TAILINGS SLOPE UNION MILL CTL 1 T PROJECT NO. DN45,584 -130 S:I PROJECTS 1465001DN45584.000113013. Letters1L11DN45 584- 1 30- L1.doc 6