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July 9, 2012 C -2009- 087 /Peabody Sage Creek Mine JDM <br />inspection. The embankments were stable and well vegetated at the time of the inspection. The primary CMP <br />spillway was in good condition and the emergency spillway was stable with no problems noted. The Pecoco Pond <br />had no problems noted. <br />9 1 <br />Upper Sump <br />Pond 004 was holding water with a trickle discharge at the time of the inspection. The embankments were stable <br />and well vegetated with no problems noted, with the exception of the following: <br />- the pond embankment was damaged on the pond side '40 feet east of the primary spillway. This damage was a <br />small slump area, 5'X10' that appeared to be caused by the failure due to animal burrows. The embankment was <br />stable with signs of failure or the possibility of failure in the short term. This damage should be addressed in order <br />to maintain the integrity of the embanlanent. <br />- The primary spillway was discharging during the inspection. This was a minimal, trickle discharge through the <br />outlet of the spill way pipe. However the inlet was submerged at the time of the inspection, which indicates a <br />small blockage of the pipe. <br />The above mentioned maintenance items should be corrected by August 10, 2012 to ensure regulatory <br />compliance and permit requirements associated with Pond 004. <br />Embankment Damage <br />Number of Partial Inspection this Fiscal Year: 0 <br />Number of Complete Inspections this Fiscal Year: 1 <br />Page 3 of 11 <br />PECOCO Pond with SCM -1 and PM -6 Construction <br />