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OBSERVATIONS <br />PERMIT #: M -1985 -003 <br />INSPECTOR'S INITIALS: BMK <br />INSPECTION DATE: March 28, 2012 <br />1) The Division conducted a monitoring inspection of the site on 2/28/12. Present during the inspection was Mr. <br />Joe Freund, the operator. The site was not active at the time of the inspection. <br />2) The site is a 30 acres 112 operation located approximately 18 miles North West of Kiowa .Post mining land use is <br />27 acres water storage. The operator had submitted a letter from their attorney stating that their ranch had <br />more than adequate water to account for the evaporative loss and be in compliance with the letter sent by the <br />Division addressing such issue. <br />3) The entire permit area is within the Running Creek Ranch property and according to Mr. Freund, all the material <br />is used within the vast holdings of the ranch property. The pond was holding partially frozen water. The bank <br />slopes were stable and no major sign of erosion noted. There was a small amount of processed asphalt stockpile <br />noted along the west side of the permit area. This material is also used within the ranch property. No problems <br />were identified during the 2007 inspection with the exception of adjusting the warranty to $11,920.00.Since <br />very little additional activity was conducted since then, the current warranty is deemed adequate. Permit sign <br />and boundary markers properly posted. <br />4) Since the product from the mining activity is used within the ranch property, the operator should consider <br />requesting a declaratory order before the Mined Land Reclamation Board to terminate the permit. If material is <br />used within the property and not sold to others, it could qualify for termination of the permit. Mr. Freund said <br />he will entertain the idea of terminating the permit via a Declaratory Order. <br />5) The permit is in compliance with the approved reclamation plan. <br />Page 2 of 4 <br />