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T <br /> STATE OF COLORADO <br /> DIVISION OF MINERALS AND GEOLOGY p9r, <br /> � <br /> Department of Natural Resources <br /> 1313 Sherman St., Room 215 <br /> Denver,Colorado 80203 <br /> Phone:(303)866-3567 <br /> FAX.(303)832-8106 <br /> DEPARTMENT OF <br /> NATURAL <br /> March 15, 1994 RESOURCES <br /> Roy Romer <br /> Mr. Robert Hagen Governor <br /> Ken Salazar <br /> Office of Surface Mining Executive Director <br /> 505 Marquette Avenue NW Michael B Long <br /> Albuquerque, NM 87102 Division Director <br /> Re: Mid-Continent Resources <br /> Coal Basin Mine (Permit C-81-017) <br /> Dear Mr. Hagen: <br /> The State of Colorado requests that the Mid-Continent Resources Coal Basin Mine be <br /> removed from the Inspectable Units List on file with the Albuquerque Field Office. <br /> Colorado believes that, both in the interest of accomplishing final reclamation of the Coal <br /> Basin Mine and in acknowledgement of the financial constraints placed upon the State, the <br /> Office of Surface Mining and the former permittee, the public interest is best served by <br /> removing this site from the traditional inspection and enforcement format employed at <br /> permitted coal mining operations. <br /> The State of Colorado has placed the Coal Basin Mine into an alternative enforcement. <br /> Actions undertaken by the State to secure the reclamation bond and to secure additional <br /> funding are consistent with previously accepted criteria for the deletion of a mine site from <br /> the Inspectable Units List (IUL). Removal of the mine site from the IUL will help to <br /> accelerate the reclamation process by ensuring that all available funds are directed toward <br /> accomplishing final reclamation at this mine. <br /> In 1988, the Division accepted a real property deed of trust as security for the reclamation <br /> bond. The estimated cost of completing reclamation is about $3 million. In February <br /> 1991, the mine was idled. In February 1992, Mid-Continent Resources filed for <br /> Chapter 11 bankruptcy protection. The State of Colorado filed its appearance with the <br /> court, having a secured claim in the amount of $3 million. The bankruptcy case, which <br /> remains unresolved, has severely hampered the ability of the State to collect adequate <br /> reclamation funding and to liquidate its reclamation bond. Conversion of the bond vehicle <br /> to cash is subject to court approval. <br /> The possibility of a surety or mining company filing for bankruptcy protection has not been <br /> contemplated in the context of the Federal regulations or within the OSM Directives. <br /> Some recognition of the complexity of a bankruptcy and the resultant difficulty in <br /> converting a reclamation bond to expendable cash must be afforded when establishing <br /> alternative enforcement criteria. The pursuit of the alternative enforcement criteria would <br /> provide a sufficient rationale for the OSM to drop a bankrupt site from the Inspectable <br /> Units List. Colorado proposes that the following guidelines be utilized to ensure that a site <br />