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June 27, 2012 C- 1980- 007/West Elk Mine <br />Inspection Topic Summary <br />NOTE: Y= Inspected N =Not Inspected R= Comments Noted V= Violation Issued NA =Not Applicable <br />N - Air Resource Protection <br />N - Roads <br />N - Availability of Records <br />R - Reclamation Success <br />R - Backfill & Grading <br />N - Revegetation <br />N - Excess Spoil and Dev. Waste <br />N - Subsidence <br />N - Explosives <br />N - Slides and Other Damage <br />N - Fish & Wildlife <br />R - Support Facilities On -site <br />R - Hydrologic Balance <br />N - Signs and Markers <br />N - Gen. Compliance With Mine Plan <br />N - Support Facilities Not On -site <br />R - Other <br />N - Special Categories Of Mining <br />N - Processing Waste <br />N - Topsoil <br />COMMENTS <br />JRS <br />This was an aerial inspection of the West Elk Mine conducted by Jim Stark of the Colorado Division of <br />reclamation, Mining and Safety. The aerial photographs were taken on 27 June 2012 by Harry Ranney, also with <br />the Division. The main purpose of the aerial inspection was to document all of the reclaimed MDW drill pads and <br />roads included in the West Elk Partial Phase II Bond Release SL -04. In all, 70 photographs of the West Elk MDW <br />pads and roads were taken during this inspection. The weather was clear and the ground was dry. <br />BACKFILL and GRADING — Rule 4.14 Contemporaneous Reclamation 4.14.1; Approximate Original Contour <br />4.14.2; Highwall Elimination 4.14.1(2)(f); Steep Slopes 4.14.2, 4.27; Handling of Acid and Toxic Materials <br />4.143; Stabilization of Rills and Gullies 4.14.6: <br />- All of the reclaimed drill pads and drill roads in the aerial photographs appeared to be well graded and stable. <br />There were no problems with slumping, sliding or settling seen. There were no erosional problems noted on any <br />of the drill pads in the photographs. <br />HYDROLOGIC BALANCE - Rule 4.05 Drainage Control 4.05.1, 4.05.2, 4.053; Siltation Structures 4.05.5, <br />4.05.6, Discharge Structures 4.05.7, 4.05.10; Diversions 4.05.4; Effluent Limits 4.05.2; Ground Water <br />Monitoring 4.05.13; Surface Water Monitoring 4.05.13; Drainage — Acid and Toxic Materials 4.05.8; <br />Impoundments 4.05.6, 4.05.9; Stream Buffer Zones 4.05.18: <br />- The mine water discharge ponds in Sylvester Gulch both contained water well below the tops of their respective <br />embankments and were not discharging at the time of the inspection. Both pond embankments were well <br />vegetated and stable and no erosional problems were noted. <br />- Both fresh water ponds at the main facilities area contained water. FW -1 was approximately 5 feet below the <br />high -water level and FW -2 appeared to be full. The pond embankments were well vegetated and appeared to be <br />stable and no erosional problems were noted on either embankment. <br />Number of Partial Inspection this Fiscal Year: 14 <br />Number of Complete Inspections this Fiscal Year: 4 <br />Page 2 of 8 <br />