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Tailings produced by the underground mill will be transported to the waste piles via truck from <br />the loadout facility shown on Map C -2. The ore sent to the mill will come from a roughly 4.5 <br />foot thick ore vein (quartz hosting the sulfides) and be processed through a flotation system <br />designed to remove >99% of sulfide minerals. The resulting tailings from this process will be - <br />150 to 325 mesh and have a moisture content of between 13% and 16 %. The mill process is <br />designed to remove the sulfide minerals from the ore to the maximum extent possible, and <br />therefore will produce tailings that will not produce acid. <br />In order to accommodate the new mining at the Revenue Mine, two waste piles will be <br />constructed over the life of the mine. The first embankment (Revenue Waste pile) will be a <br />central pile located on top of the existing waste rock embankment. The second embankment <br />(Atlas Waste pile) will be to the west of the current mining area, and will be constructed on <br />ground that was partially disturbed by the Atlas Mine. Map C -4 shows the final maximum extent <br />of the two piles. These two embankments will have a combined capacity of approximately <br />1,144,000 tons. This volume will provide 11.4 years of tailings and waste storage under the <br />assumption that no waste rock is removed from the site. If large amounts of waste rock are <br />removed, the life of the piles could be extended slightly beyond 15 years. At such time, SMO <br />may consider revising the permit to allow paste fill storage of tailings underground. It cannot be <br />done at this time since it is planned to conduct new mining in all areas and there is no room to <br />place the paste fill at this time. <br />Approximately 75,000 tons of fine mill tailings and 20,000 tons of waste rock are planned to be <br />produced on an annual basis. It is planned that some, if not all, of the waste rock will be <br />processed by crusher and either be given to Ouray County or sold to customers, as demand <br />dictates. For the purposes of this plan, it is assumed that no waste rock is removed from the site <br />and must be spread out in lifts and compacted in the 2 tailings /waste rock piles. <br />Waste rock generated by excavation activity is known to be inert andesite, and is sought after by <br />Ouray County and others for use as a construction material. Therefore, during operations, a small <br />Revenue Mine August 2012 D - <br />