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July 19, 2012 C- 1981 - 018 /Deserado Mine ZTT <br />Inspection Topic Summary <br />NOTE: Y= Inspected N =Not Inspected R= Comments Noted V =Violation Issued NA Applicable <br />R - Air Resource Protection R - Roads <br />N - Availability of Records N - Reclamation Success <br />N - Backfill & Grading N - Revegetation <br />N - Excess Spoil and Dev. Waste N - Subsidence <br />N - Explosives N - Slides and Other Damage <br />N - Fish & Wildlife N - Support Facilities On -site <br />R - Hydrologic Balance R - Signs and Markers <br />R - Gen. Compliance With Mine Plan N - Support Facilities Not On -site <br />N - Other N - Special Categories Of Mining <br />R - Processing Waste Y - Topsoil <br />COMMENTS <br />AIR RESOURCE PROTECTION — Rule 4.17: <br />No fugitive dust was observed during the time of the inspection. <br />HYDROLOGIC BALANCE - Rule 4.05 <br />Drainage Control 4.05.1, 4.05.2, 4.053; Siltation Structures 4.05.5, 4.05.6; Discharge Structures 4.05.7, <br />4.05.10; Diversions 4.05.4; Effluent Limits 4.05.2; Ground Water Monitoring 4.05.13; Surface Water Monitoring <br />4.05.13; Drainage — Acid and Toxic Materials 4.05.8; Impoundments 4.05.6, 4.05.9; Stream Buffer Zones 4.05.18 <br />Sedimentation Pond DP -1 receives surface runoff from all facility benches. Rip rap lined ditches north of the pond <br />direct the runoff from the benches down to the pond. Channels were stable with no signs of instability were <br />observed. Wash down water from the conveyor belt transporting raw coal from the portal was the only visible sign <br />of water recharging the pond. Pond DP -1 held water at the time of the inspection with no discharge. Embankments <br />were well vegetated. <br />Sedimentation Ponds PP -1 and PP -2 held water with no discharge. All the ponds embankments were stable with <br />no signs of instability observed. <br />The sump located north of the Raw Coal Silos held minimal water with no discharge. <br />The B -Seam Dewatering Pond has been partially filled with water up to the Last Chance Pond since the last <br />inspection. No discharge has yet to occur from the pond system. The dewatering pump was not operating during <br />the time of the inspection. All embankments were stable and vegetation is starting to grow from the recent seeding <br />on top of the topsoil piles between ponds. <br />Sedimentation Ponds RP -2/3, RP -4, RP -5a, RR -1, RRS -1, SS -1 and SS -2 held no water. All embankments were <br />Number of Partial Inspection this Fiscal Year: 1 <br />Number of Complete Inspections this Fiscal Year: 0 <br />Page 2 of 4 <br />