_GENERAL DOCUMENTS - C1981017 (254)

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STATE OF COLORADO DIVISION OF MINERALS AND GEOLOGY Department of Natural Resources Pow,J 1313 Sherman St.,Room 215 Denver,Colorado 80203 Phone:(303)866-3567 WN FAX:(303)832-8106 DEPARTMENT OF March 18, 1994 NATURAL RESOURCES Ms . Beverly Keifer Chair Roy Romer Governor Mt. Sopris Group of the Sierra Club Ken Salazar P.O. Box 4648 Executive Director Aspen, Colorado Michael B Long 81612 Division Director RE: Mid-Continent Resources, Coal Basin Mine Dear Ms . Keifer: Thank you for your correspondence of March 9 , 1994 regarding the Mid-Continent Resources Chapter 11 Liquidation Plan. On Tuesday, March 15, 1993 , the Mined Land Reclamation Board voted to accept the amended liquidation plan. The previous liquidation proposals had been found to be unacceptable to the Board because they would have required the State to put its personal liability suit on hold. The personal liability suit was filed by the State of Colorado last September in Pitkin County District Court. The suit requests that the agents of Mid-Continent Resources either immediately complete reclamation of the mine site, or provide the necessary funds for the State to complete the reclamation project through a third party contractor. The State views this lawsuit as a necessary tool in order to secure reclamation of the Coal Basin Mine, particularly if the liquidation plan is not fully funded. The liquidation plan now filed with the bankruptcy court does not require that the personal liability suit be put on hold or be withdrawn. With these constraints removed, the Board felt that it was prudent to approve the potential reclamation funding source described in the liquidation plan. I would like to take this opportunity to clarify a misconception which appears to be widely held. The liquidation plan does not address either the 35 acre parcel issue, or the land exchange idea. The liquidation plan simply states that the properties held by Mid-Continent Resources will be sold, and that the proceeds would be split by the Mined Land Reclamation Board and other secured and unsecured parties to the bankruptcy proceeding. While the land exchange concept has been publicly forwarded by Mid-Continent personnel it is not included in the amended liquidation plan. It is unclear to me where the 35 acre tract idea arose, but it also is not addressed in the plan.