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REASON FOR INSPECTION: <br />Normal I &E Program <br />BOND CALCULATION TYPE: <br />None <br />BOND AMOUNT: <br />$47,243.00 <br />DATE OF COMPLAINT: <br />NA <br />POST INSP. CONTACTS: <br />None <br />JOINT INSP. AGENCY: <br />Boulder County <br />WEATHER: <br />Clear <br />INTO 'S SIG ATURE: <br />%(p <br />SIGNATURE DATE: <br />September 16, 2011 <br />MINE NAME: <br />Gold Hill Mill <br />MINE/PROSPECTING ID #: <br />M- 1994 -117 <br />MINERAL: <br />Gold and silver <br />COUNTY: <br />Boulder <br />INSPECTION TYPE: <br />Monitoring <br />INSPECTOR(S): <br />Michael A. Cunningham <br />INSP. DATE: <br />August 24, 2011 <br />INSP. TIME: <br />09:30 <br />OPERATOR: <br />AGC Resources LLC <br />OPERATOR REPRESENTATIVE: <br />NA <br />TYPE OF OPERATION: <br />110(2) - Hard Rock Limited Impact <br />COLORADO DIVISION OF RECLAMATION, MINING AND SAFETY <br />MINERALS PROGRAM INSPECTION REPORT <br />PHONE: (303) 866 -3567 <br />The Division of Reclamation, Mining and Safety has conducted an inspection of the mining operation <br />noted below. This report documents observations concerning compliance with the terms of the permit <br />and applicable rules and regulations of the Mined Land Reclamation Board. <br />The following inspection topics were identified as having Problems or Possible Violations. OPERATORS <br />SHOULD READ THE FOLLOWING PAGES CAREFULLY IN ORDER TO ASSURE COMPLIANCE <br />WITH THE TERMS OF THE PERMIT AND APPLICABLE RULES AND REGULATIONS. If a <br />Possible Violation is indicated, you will be notified under separate cover as to when the Mined Land <br />Reclamation Board will consider possible enforcement action. <br />INSPECTION TOPIC: Acid And Toxic Materials <br />PROBLEM /POSSIBLE VIOLATION: Probable Violation: Tailings have been deposited outside of the tailings <br />storage facility. This is a possible violation at this time pursuant to C.R.S. 34- 32- 116(7)(c) for failure to handle <br />acid - forming or toxic - producing material in a manner that will protect the drainage system from pollution. <br />CORRECTIVE ACTIONS: This possible violation will require a hearing before the Mined Land Reclamation Board. <br />The schedule and other details for the MLRB hearing will be provided under a separate document to be sent via <br />certified mail to the operator. <br />CORRECTIVE ACTION DUE DATE: 10/11/11 <br />Mc c 1/47 <br />Page 1 of 6 <br />