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OXBOW MINING, LLC <br />3737 Hwy 133 P.O. Box 535 Somerset, Colorado 81434 USA Tel (970)929 -5122 Fax <br />(970)929 -5177 <br />January 19, 2012 <br />Mr. Brock Bowles <br />Environmental Protection Specialist <br />Colorado Division of Reclamation, Mining and Safety <br />1313 Sherman Street, Room 215 <br />Denver, Colorado, 80203 <br />Re: Oxbow Mining LLC, Permit No. C- 1981 -022, Response to Midterm Review (MT -06) and <br />Request for MR -98 — Ownership and Control and Bonding Issues. <br />Dear Mr. Bowles, <br />Oxbow Mining, LLC received a Mid -Term Review MT -06 from the Division on July 7, 2011 and <br />this letter and the accompanying MR -98 is intended to address the issues raised by the review. <br />Question #1 — Ownership & Control. <br />Page 6, Section IV — Midterm Adequacy Question #1 requests an update to the OMLLC Ownership <br />and Control (O &C) information. The modified Oxbow Corporate structure has been completed. <br />Submittal of the revised OMLLC information had also been delayed until similar 0 & C issues <br />were concluded for the Terror Creek, LLC operation. To facilitate the modification of the <br />OMLLC, O &C information, we are requesting the attached a Minor Revision No. 98 to Permit C- <br />1981 -022. The MR consists of revised PAP pages 2.03 -6, 7, 8 and 9. <br />To aid in the Division's review, we are also providing additional supporting information in the form <br />of Corporate Certificates and a Certification regarding the non -role that Crestview -Oxbow <br />Acquisition, LLC. plays in the affairs of Oxbow Mining, LLC. <br />Question #2 — Bonding Information. <br />/ <br />The Division has recalculated the reclamation cost estimate for the Sanborn Creek and Elk Creek <br />Mines. The new reclamation liability is reduced by $513,587.00 due mainly to changes in the <br />OMLLC borehole sealing plans approved in TR -66 on March 12, 2010. <br />OMLLC has reviewed the issue and has determined, for the time being, to not apply for a bond <br />reduction. Rather, we propose to maintain the larger contingency available for future mine projects, <br />permit revisions, renewals, etc. <br />