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NEW ELK COAL COMPANY LLC <br />122 WEST FIRST STREET <br />TRINIDAD, CO 81082 <br />(719) 845 -0090 <br />New Elk Mine Ron Thompson <br />Lorencito Canyon Mine Mine Manager <br />October 1, 2011 <br />Mr. Kent Gorham <br />Colorado Division Reclamation, Mining and Safety <br />1313 Sherman Street, Room 215 <br />Denver, Colorado 80203 <br />Re: New Elk Mine: Permit No. C -81 -012 <br />Quarterly Sediment Pond Inspections <br />Dear Mr. Gorham: <br />Enclosed are copies of the Third Quarter 2011 Quarterly Sediment Pond Inspection <br />Reports conducted to comply with CDMR Rule 4.05.9(17). All embankments were <br />found stable and vegetated. <br />No Mine water has been pumped to Pond 1 during the quarter Lining of Pond 1 is being <br />prepped for lining to prevent seepage. No discharge occurred from any ponds during the <br />quarter. <br />Please contact me if you have any questions. <br />Regards, <br />kA, <br />MSHA Certified - Impoundment Inspections <br />