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May 24, 2012 C- 1981- 012/New Elk Mine JHB <br />Inspection Topic Summary <br />NOTE: Y= Inspected N =Not Inspected R= Comments Noted V= Violation Issued NA =Not Applicable <br />Y - Air Resource Protection <br />N - Availability of Records <br />N - Backfill & Grading <br />R - Excess Spoil and Dev. Waste <br />N - Explosives <br />Y - Fish & Wildlife <br />R - Hydrologic Balance <br />Y - Gen. Compliance With Mine Plan <br />R - Other <br />R - Processing Waste <br />R - Roads <br />Y - Reclamation Success <br />Y - Revegetation <br />N - Subsidence <br />N - Slides and Other Damage <br />Y - Support Facilities On -site <br />Y - Signs and Markers <br />R - Support Facilities Not On -site <br />NA - Special Categories Of Mining <br />R - Topsoil <br />COMMENTS <br />This was a partial inspection conducted by Janet Bums of CDRMS. New Elk Coal Company representatives that <br />accompanied the inspection included Vince Massarotti and Bobby Steele. Highway 12 CDOT construction had <br />closed down the highway the evening of May 23rd. Mine personnel met the inspector in the town of Weston and <br />escorted the inspector to through the previously bond released Golden Eagle mine area via the old rail road grade. <br />CDOT was working on emergency bridge repairs to reopen Highway 12. Closure of the highway affected the <br />mine's ability to run trucks to the load out. <br />The mine site was dry and warm with the wind picking up in the afternoon <br />EXCESS SPOIL and DEVELOPMENT WASTE — Rule 4.09 <br />Placement; Drainage Control; Surface Stabilization: <br />DRMS approved MR117 on 5/22/2012, which provided approval for temporary storage of development waste <br />material immediately north of the approved topsoil stockpile. Approval of MR117 allowed NECC to comply with <br />a citation they had previously received from MSHA. NECC had not begun storage of development waste at this <br />location during the inspection. NECC has prepared this area for storage of the development waste and has <br />removed any previously placed topsoil. NECC will assure there is adequate separation of the development waste <br />material from the topsoil and subsoil stockpiles stored in this same area. <br />NECC has submitted a revision (TR65) to permit another development waste stockpile at the West portal. This <br />revision is still under review. <br />NECC continues to shape and configure the DWDA 42 pile. An excavator was working the SE portion of the <br />DWDA #2 to adjust the grade of the slopes. Ditch 12 on the north side of the DWDA needs to be maintained to <br />assure drainage off the pile is routed appropriately to the sediment control system. <br />Number of Partial Inspection this Fiscal Year: I I <br />Number of Complete Inspections this Fiscal Year: 3 <br />Page 2 of 10 <br />