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With regard to any legal requirements about permitting the wells, you would have to ask the Division of Water <br />Resources(DWR). <br />As far as our process goes, once the wells are permitted with DWR, they can be transferred under our Rule 4.05.14 and <br />assuming that the other drill site locations have been reclaimed, which is apparently the case based on previous BLM <br />and DRMS inspections, Peabody can get their bond released in its entirety for the NOI. <br />From: Maiolo, Jennifer A [mailto:jmaiolo@ blm.govl <br />Sent: Tuesday, May 29, 2012 10:35 AM <br />To: Gorham, Kent <br />Subject: Hart Syncline Wells <br />Kent — can you explain to me the legal repercussions of permitting the monitoring wells? The company, Reserve Coal <br />Prop. Is interested in permitting the wells, but want to know what that means for the future. Does that mean the State <br />will come in sometime in the future and tell them to plug? <br />Thanks <br />Jennifer Maiolo <br />Mining Engineer <br />BLM <br />Little Snake Field Office <br />455 Emerson St. <br />Craig, CO 81625 -1129 <br />970 - 826 -5077 <br />imaiolo(cr�blm.00v <br />2 <br />