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2 <br /> As mentioned in the January 5, 1998 memo, Mid Continent Resources (MCR) petitioned in <br /> bankruptcy in February 1992. The bankruptcy court confirmed a liquidation plan in April 1994. <br /> That plan provides that the Division is to receive $3 million in cash and services for reclamation <br /> of the site. The plan is funded by liquidation of MCR's assets, which continues to be an on-going <br /> process. So far, the funds distributed from the liquidation plan have been sufficient to perform <br /> reclamation. <br /> Also as mentioned in the January memo, Pitkin County filed a lawsuit against MCR claiming that <br /> MCR owed the county back taxes and interest for sales of real and personal property. The <br /> Division was impleaded into the case based on the allegation that MCR could not account to the <br /> county without receiving an accounting from the Division of the amount of reclamation funds <br /> expended and the amount of reclamation funds the Division still needs to complete reclamation. <br /> On January 23, 1998,the Division provided the parties and the court with such an accounting. <br /> The accounting provides the Division's best estimate at this time of the cost to complete <br /> reclamation given current conditions. However, until bids are accepted and the work is done, <br /> actual costs cannot be determined. <br /> In addition to the accounting, MCR has asked the Pitkin County court to determine how much it <br /> still owes to the Division under its liquidation plan. This request may entail determining the <br /> amount of credit to be taken against the reclamation funds for reclamation work done by <br /> entities other than the Division. Currently,the trial on this matter is set for August 7 through <br /> August 14, 1998. <br /> It should be noted that in 1993 the Division brought a personal liability suit against the agents of <br /> MCR. This suit was dismissed by the District Court based, among other things, on the court's <br /> finding that at that time the Division had access to funds for reclamation through MCR's <br /> liquidation plan. The Division appealed that part of the trial court's order which stated that the <br /> Division was estopped from seeking more than $3 million for reclamation. The Court of <br /> Appeals' ruling left open the possibility of the Division pursuing funds against the agents of MCR <br /> should funds through the liquidation plan prove insufficient to conduct necessary reclamation. <br /> In summary, the Division is in the process of completing necessary reclamation to the extent <br /> forfeited bond funds permit. The Division is actively involved in both the MCR bankruptcy <br /> liquidation and in the case filed by Pitkin County. Furthermore, the Colorado Court of Appeals <br /> ruling of December 26, 1996 (which is copied in the citizen's complaint received by OSM) left <br /> open the possibility for the Division to pursue reclamation funds, should these funds be required <br /> to complete necessary reclamation. Therefore, the Division is implementing the provisions of <br /> Rule 3.04.2(6). We respectfully submit that the reclamation work and civil proceedings taken by <br /> the Division constitute good cause for not taking corrective action in response to this Ten Day <br /> Notice. <br />