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August 22, 2012 C -2009- 087 /Peabody Sage Creek Mine JDM <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 />R -Roads <br />N - Availability of Records <br />R - Reclamation Success <br />N - Backfill & Grading <br />N - Revegetation <br />NA - Excess Spoil and Dev. Waste <br />NA - Subsidence <br />NA - Explosives <br />NA - Slides and Other Damage <br />N - Fish & Wildlife <br />Y - Support Facilities On -site <br />R - Hydrologic Balance <br />N -Signs and Markers <br />R - Gen. Compliance With Mine Plan <br />N - Support Facilities Not On -site <br />R - Other <br />N - Special Categories Of Mining <br />NA - Processing Waste <br />R - Topsoil <br />COMMENTS <br />HYDROLOGIC BALANCE - Rule 4.05 <br />Drainage Control 4.05.1. 4.05.2, 4.05.3; 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 />The upper sump, the lower sump, Pond 004, Pecoco Pond, Pond 003, and Pond 002 (Wadge) were identified in the <br />aerial photographs. All Ponds were holding water at the time of the inspection. Pond embankments appeared <br />stable with good vegetation and no evidence of erosional features or problems noted, with the exception of the <br />following. <br />- Little to no vegetation was observed on the embankments of the upper and lower sumps. The constructions of <br />these sumps have recently- been completed and have yet to go through a full growing season. <br />The following established drainages were observed: PM- 6(lower end), PM- 4(lower), SIIPM -5, and PM- <br />4(overflow) <br />No problems were identified in the aerial photographs. <br />Construction appeared to be ongoing at ditches: SCM -1, SCM -IA, CH -2, and FA -D4 <br />GENERAL MINE PLAN COMPLANCE: <br />Coal was observed at the temporary coal handling facility at the conveyor of the portal. Construction equipment <br />was observed in the areas of the FA -D4 ditch and in and around the area of the PM -4 drainage. <br />OTHER (SPECIFY): <br />This was an aerial inspection flown by Harry Ranney of the Colorado Division of Reclamation, Mining and Safety <br />(Division). Oblique aerial photographs were taken on August 22, 2012 and reviewed in the Denver office by <br />Jason Musick of the Division on August 28, 2012. The weather was clear and the site appeared dry at the time of <br />the inspection. The photographs displayed evidence of construction of facilities in and around the area of the <br />approved southern facilities area and areas of reclamation throughout the site. <br />Number of Partial Inspection this Fiscal Year: 2 <br />Number of Complete Inspections this Fiscal Year: 1 <br />Page 2 of 7 <br />