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May 15, 2012 C- 1981 - 014 /Southfield Mine JHB <br />The depth counter was initialized once the camera was in place, before the inspector began lowering the camera <br />down the hole. The surface casing is a steel casing 8 inches in diameter. The casing reduced in size to a 6" steel <br />casing at 28 feet below the surface (BS). No problems or failures were observed in the casing down to 336.2 feet <br />BS. At 336.2 BS the camera encountered a tangle of steel cable. George reported that he had previously lost a <br />water monitoring probe down the hole and the 1/16" steel cable had broken at the surface and fallen into the <br />borehole. The Division was concerned that proceeding with the camera below the steel cable tangle may result in <br />snagging the camera and potentially losing the borehole camera down the MW -NW borehole. The Division <br />decided to cease exploration of the borehole at this point and safely brought the borehole camera back to the <br />surface. <br />Energy Fuels needs to extract the cable from the well to assure that MW -NW is performing as designed and to <br />allow for the Division to complete its assessment of the borehole. The cable and probe needs to be removed <br />within 30 days following this inspection. Or establish a new well that will accurately measure the ground water <br />elevation and quality in the same strata (Red Arrow Seam) within the same time frame. <br />The DVD recording of the downward track of the camera failed to record. Only 30 seconds of the camera's data <br />recorded. <br />Surface water: Newlin Creek was flowing upstream of the Thompson Ranch driveway culvert and flowing <br />through the culvert. The reconstructed Newlin Creek drainage was observed SW from the Thompson driveway to <br />the area of previously identified subsidence holes. Surface flow in the reconstructed drainage had pooled in areas <br />within the rocks, but continued through the constructed drainage to the Thompson culvert. No surface expression <br />of subsidence features was evident within the Newlin Creek channel. <br />SUBSIDENCE — Rule 4.20: <br />The Subsidence holes previously identified during the December 14, 2011 inspection were re- evaluated <br />and observed. The Division located 6 holes that had previously identified. Hole naming designations have been <br />kept consistent with the name identification given as a result of the 12/14/2011 inspection. Photos and GPS <br />coordinate locations did not indicate that these holes had enlarged in size, nor did it appear that the depth of the <br />holes had increased. No moisture or pooled water was observed in the bottom of the holes. No visible openings <br />were observed into underground workings. <br />The area from SW of the Reclaimed pit (GEC), south of Newlin Creek, to the powerline was traversed to see if <br />any additional holes had formed that had not previously been observed. No new holes were identified. A track <br />was observed under the power line. This track appears to be used by light vehicles or ATVs, and does not appear <br />to be used frequently. This track is well south of the subsidence holes. <br />Estimated dimensions of the holes are as follows: <br />Hole 6: furthest south hole, Approximately 20ft. diameter, close to round, and 15 foot deep <br />Hole 5: Approximately 40 feet north of Hole 6: 15 foot diameter, 10 foot deep <br />Number of Partial Inspection this Fiscal Year: 8 <br />Number of Complete Inspections this Fiscal Year: 3 <br />Page 3 of 15 <br />