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October 4, 2011 X-2011-2-'11-02/Peabody Sage Creek 2011 Exploration Project SLB <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 />R - Backfill & Grading <br />N - Fish & Wildlife <br />R - Hydrologic Balance <br />N - Gen. Compliance With Mine Plan <br />NA -Other <br />N -Roads <br />N - Reclamation Success <br />R - Revegetation <br />NA - Slides and Other Damage <br />R -Signs and Markers <br />R - Topsoil <br />COMMENTS <br />This was a partial inspection of the Peabody Sage Creek Mining Company's 2011 exploration drilling sites, limited <br />to the three holes located along the Yoast Mine Haul Road A corridor (Hole IDs CCU072, CCU073, and CCU074). <br />No representative of Peabody Sage Creek was present during the inspection. Drilling operations at these holes <br />were observed by this inspector on July 18 and 19, 2011. <br />BACKFILL and GRADING — Rules 2.02(g) and 4.21.4(4): <br />The CCU072, CCU073, and CCU074 drill pads and associated pits had been regraded to blend with the <br />surrounding topography. <br />HYDROLOGIC BALANCE - Rules 2.02(f), 4.21.4(7), and 4.21.4(10): <br />Straw wattles were in place on the downgradient sides of the drill pads. <br />REVEGETATION — Rules 2.02(g) and 4.21.4(6): <br />Each of the three sites appeared to have been seeded; grasses were germinating at each site. <br />SIGNS AND MARKERS — Rules 4.21.1 and 4.02: <br />Ground level brass cap type hole markers with the company name, hole number, and year drilled were in <br />place along with a 4' fence post type marker at all three inspected sites. <br />TOPSOIL — Rules 2.02(f) and 4.21.4(5): <br />Topsoil had been redistributed at each site. <br />Number of Partial Inspection this Fiscal Year: 0 <br />Number of Complete Inspections this Fiscal Year: 0 <br />Page 2 of 4 <br />