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COTTER CORPORATION (N.S.L.) <br />RESPONSE TO DRMS LETTER DATED SEPTEMBER 9, 2011 <br />Additional information requested by DRMS: <br />1) Request: A detailed justification as to why another extension is needed. <br />Response: On July 22, 2011 Cotter representatives John Hamrick and Randy Whicker met <br />with David Bird and Tony Waldron of DRMS to discuss a proposal to divide construction of <br />the pipeline diversion project into two phases in order to allow construction of the upper <br />cutoff wall to begin in 2011, and to also allow a temporary, 8 cfs HDPE pipeline to be <br />constructed at the same time in order to begin isolating the creek from the alluvial fill as soon <br />as possible (Phase 1). The rationale for the proposal is that permitting evaluations and <br />approvals from multiple agencies for the 100 cfs steel pipeline cannot be realistically <br />completed such that construction of the steel pipeline and lower cutoff wall (Phase 2) could <br />begin prior to the fall of 2012. Cotter informed DRMS that the U.S. Army Corps of <br />Engineers (USACE) and U.S. Fish and Wildlife Service (USFWS) had indicated a favorable <br />view of this proposal and Mr. Bird and Mr. Waldron subsequently expressed a favorable <br />view as well. <br />Also at the July 22, 2011 meeting, Mr. Bird and Mr. Waldron indicated to Cotter that DRMS <br />could conditionally approve a phased approach for TR -18, with the stipulations that: <br />a) Disturbances associated with Phase 1 pipeline construction and infrastructure will <br />occur only within areas of the site that are currently permitted under the mine <br />reclamation permit. <br />While responses to all Adequacy Review comments had been developed by the August 6, <br />2011 deadline, a number of technical responses related to final engineering designs were <br />incomplete (only conceptual in nature) at that time because the necessary geotechnical <br />1 <br />9/16/11 <br />b) Appropriate reclamation bonding is in place prior to any construction. <br />c) An amendment to the mine reclamation permit that extends the permitted area to <br />accommodate all disturbances associated with Phase 2 pipeline construction and <br />infrastructure be submitted and approved prior to implementation of Phase 2 of the <br />creek diversion project. <br />Cotter is aggressively proceeding with development of permit submittals to DRMS and other <br />agencies, geotechnical studies, and engineering designs in accordance with the above <br />stipulations for conditional DRMS approval of TR -18. One of the permitting submittals <br />includes responses to the Revised Adequacy Review of TR -18 issued by DRMS on July 6, <br />2011 (Adequacy Review). Although the Adequacy Review was issued prior to the July 22 <br />meeting between Cotter and DRMS, and prior to the subsequent plan to include a phased <br />approach for pipeline implementation, Cotter proceeded to develop responses to Adequacy <br />Review comments in accordance with the indicated August 6, 2011 deadline for submittal. <br />