2011-08-08_INSPECTION - P2011015

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OBSERVATIONS Altercation with Mr. Jepson PERMIT #: P- 2011 -015 INSPECTOR'S INITIALS: WHE INSPECTION DATE: July 27, 2011 This inspection occurred as part of the Division's review process for a modification (MD -01) to the approved NOI and in response to a citizen's complaint against the existing operation. MD -01 was filed with the Division on July 25, 2011, and addresses an expansion of the drilling operation to add four holes to the original 10, totaling 14 drill holes. On July 28, 2011, the Division received a written complaint against the existing operation, submitted by Joe Jepson. The complaint from Mr. Jepson was dated July 27, 2011, and alleges the drilling of test holes outside the scope of the approved NOI and potential backfilling of the test holes with tailings and concrete slurry, possibly resulting in adverse impact to water quality. Copy of the complaint, six photos and a sketch map accompany this report. During the inspection a drill crew from Trautner Geotech was drilling hole KMGT -5. The drill crew from Trautner Geotech included Jon Butler, Tom Harrison and Ross Barrett. The Operator was represented by Steve Fearn, John Ferguson and Ray Ferguson. Drill holes KMGT -3, 6, 8, 9 and 11 had been drilled and closed. The Operator stated all drill holes had been backfilled with % inch clean gravel to within 10 feet of surface, and Portland cement grout from 10 feet to surface. As shown in the photos, gravel had been stockpiled nearby and immediately available for backfill. The method of closure is appropriate and protective of the hydrologic balance of the affected lands and surrounding areas. Drill cuttings and fluids had been retained in shallow pits immediately adjacent to the drill hole, evidence of cuttings and fluids entering the drainageway were not observed. Drill holes KMGT -1, 2, 4, 7 and 10 had not yet been drilled. The intent of the drilling operation is to collect geotechnical data to determine the feasibility of the site as a tailings storage facility. As shown in the photos, the property contains tailings from historic and pre -law milling operations. The historic tailings are loose and uncontained. As noted by Mr. Jepson, the Operator deviated from the original drill pattern. The Operator stated the data from the initial holes indicated more favorable subsurface conditions along the east side of the property. Therefore, the Operator relocated drill holes KMGT -1 and KMGT -10 approximately 180 feet north of KMGT -2 and KMGT -3. The new location for KMGT -10 was renamed KMGT -11. The drilling operation was still limited to 10 holes, as approved by the Division. The approved NOI identified the approximate locations of the proposed drill holes. The drilling pattern was conceptual, intended to gather sufficient data to characterize subsurface conditions of the property. Conceptual plans are appropriate for exploration activities and the Division does not have reason to believe the Operator violated the conditions of the NOI by relocating two of the drill holes. Under MD -01, the Operator has requested to expand the drilling operation to include four additional holes. As shown on the sketch map, the four new holes are located on the same land parcel and south of the original 10 holes. As shown in one of the photos, the four new holes appear to be located in an avalanche run -out zone. The drill crew and representatives of the Operator verified a previous report of an altercation with Mr. Jepson, occurring July 21, 2011, at approximately 1800 hours. According to the individuals present on July 21, the crew was backing the drill rig into position for KMGT -1 when Mr. Jepson appeared and demanded to know who was in charge. Mr. Jepson demanded to see copy of the approved permit. Mr. Jepson argued no permit had been issued for the drilling activity. Mr. Jepson claimed to have discussed the issue with Wally Erickson Page 2 of 3