2012-06-20_PERMIT FILE - C2010089A (10)

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result of the oxidation of the hydrocarbons, pyrite, (FeS2), and marcasite in the coal. High sulfur (greater than 1%) in the coal is typically due to visible pyrite (nodules) and or marcasite in the core. Peabody coal core analysis is presented in Appendix 2.04.6 -4. Western Fuels drilled three coal cores concurrently with the overburden drilling at holes NHN11 -1, NHN11 -2, and NHN11- 3. The complete analysis of these locations as well as sulfur forms can be found in Appendix 2.04.6 -5. New Horizon North Overburden Assessment The NHN permit area incorporates the area of the old Nucla Mine (see Map 2.04.6 -1) and overburden information pertaining to it is contained in "Western Fuels- Colorado's New Horizon Mine Reclamation Plan for New Horizon 1 Mine Area, Coal Mining Permit C -81 -008, 1993 ". The proposed permit area is also adjacent to the New Horizon Mine and overburden information is located in WFC's "Mining and Reclamation Plan for New Horizon 2 Mine Area, Colorado Mining Permit C -81- 008 ". Five (5) overburden sample holes (1C, 3C, 695E, 697E and 775E) for which data are contained in the New Horizon 1 Mine Area are located in the proposed permit area. The locations of these five holes are shown on Map 2.04.6 -1. CDRMS, Guidelines for the Collection of Baseline Water Quality and Overburden Geochemistry Data (1982) recommends that overburden sample hole spacing should be approximately one hole per square mile, with a minimum of three holes per site. WFC collected overburden samples from three holes (NHN11 -1, NHN11 -2, and NHN11 -3) drilled in March of 2011. These 3 hole locations are also shown on Map 2.04.6 -1. Holes were located in areas of the highest overburden (60 -80 feet). Each of the three locations were core drilled from 15 feet to total depth. Due to mechanical constraints, the upper 15 feet were rotary drilled and the drill chips were sampled in four -foot intervals. The holes were drilled on air with water injection and a "lithium based" joint compound was used. The samples were collected in plastic bags with the sample number and footage written on the bag for each sample. The samples were then sent to Wyoming Analytical (WAL) Laboratories, Inc. in Laramie, Wyoming for analyses. The analyses were completed and reported on 5/10/11. All analysis followed DRMS's "Guidelines for the Collection of Baseline Water Quality and Overburden Geochemistry Data." The WAL analyses were added with other specific hole information, (lithology, depth, etc.) and the information compiled by hole by sample by parameter to provide the Sample Description which is also contained in the Appendix as Appendix Table 2.04.6 -2. Copies of the WAL lab reports are contained in Appendix 2.04.6 -3 of this permit application. The purpose of the chemical analyses of overburden, interburden and underburden samples is to identify any acid - forming, toxic - forming, alkalinity producing, or other inhibitory materials present within the proposed mine boundary. Physical properties of the overburden were determined to define compaction, stability, permeability, erodibility, and water holding characteristics. Chemical and physical analyses also reveal the most desirable overburden strata to be placed at the spoil surface and in the pit base. This baseline information is required to effectively prepare a mine plan that restores landscape productivity and which also minimizes environmental degradation. Table 2.04.6 -2 is a comparison of the results from the analysis from the holes drilled in 2011 with the other five holes that were drilled and sampled in the permit area. This comparison shows that the results are similar with the exception of the trace element Section 2.04.6 Page 8 April 2011