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September 28, 2011 <br />X- 2007 - 228 -00 /Ark Land Grand Valley Book Cliffs KAG <br />Inspection Topic Summary <br />NOTE: Y= Inspected N =Not Inspected R= Comments Noted V= Violation Issued NA =Not Applicable <br />N - Air Resource Protection <br />N - Backfill & Grading <br />N - Fish & Wildlife <br />N - Hydrologic Balance <br />N - Gen. Compliance With Mine Plan <br />N - Other <br />N - Roads <br />R - Reclamation Success <br />N - Revegetation <br />N - Slides and Other Damage <br />N - Signs and Markers <br />N - Topsoil <br />COMMENTS <br />RECLAMATION SUCCESS - Rule 2.02(8) and 4.21.2(2): <br />This was a coal exploration bond release inspection conducted by Kent Gorham of the Colorado Division of <br />Reclamation, Mining, and Safety. Wendell Koontz, Senior Mine Geologist at Ark Land Company represented the <br />operator during the second day of the inspection. A previous inspection on October 7, 2008 and partial bond <br />release effective November 7, 2008 reduced the required bond amount for this project from $123,340.00 to <br />$24,302.00. The partial release was necessary to allow vegetation to become established on the reclaimed areas. <br />The applicant requested a full release of the remaining bond for this project on September 21, 2011. Surface lands <br />affected and reclaimed for this project are entirely owned by the Bureau of Land Management. A memo and report <br />dated September 21, 2011 documents the BLM decision to terminate the Federal exploration period of liability for <br />this project based on the success of the reclamation work performed. <br />The inspection began unaccompanied on September 28, 2011 to preview the access and terrain. The exploration <br />area is located on BLM lands in the general area of Big Salt Wash, Buniger Canyon, Post Canyon, Lapham <br />Canyon, and Garvey Canyon (US R10 1W of the 6th P.M.) The terrain is extremely rugged and heavily vegetated, <br />especially in higher elevation areas. Wildfire has previously affected some areas. Oil and gas production was <br />evident although not numerous in tenns of actual site locations. <br />Site BSW0702 was located nearly the mouth of Post Canyon. It was found very well vegetated mostly with <br />grasses. Large rocks had been placed along the Big Salt Wash road to prevent vehicle access to the site. <br />The reclaimed road above site BSW0703 was viewed from a distance. This reclaimed road was constructed to <br />allow access to sites BSW0805, BSW0804, and BSW0803, all remote sites located on the ridge to the east of Big <br />Salt Wash. The road appeared well vegetated and slopes had been pulled back to conform to the contour. <br />The following morning, I was accompanied by Mr. Wendell Koontz. We began our inspection at Site BSW0701 <br />along the main county road in Big Salt Wash. The site was found well vegetated with a diverse mix of grasses, <br />forbs, and shrubs. Evidence of excessive erosion was not noted. <br />We then proceeded to site BSW0703, located upstream in Big Salt Wash near the mouth of Lapham Canyon. Both <br />the site and the reclaimed road leading to other locations high on the ridge were found well vegetated and in <br />Number of Partial Inspection this Fiscal Year: 0 <br />Number of Complete Inspections this Fiscal Year: 0 <br />Page 2 of 10 <br />