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August 29, 2012 C- 1981 - 022 /Elk Creek Mine MPB <br />Inspection Topic Summary <br />NOTE: Y= Inspected N =Not Inspected R °Cornments Noted V= Violation Issued NA =Not Applicable <br />N -Air Resource Protection <br />N -Availability of Records <br />N - Backfill & Grading <br />NA - Excess Spoil and Dev. Waste <br />N - Explosives <br />N - Fish & Wildlife <br />R - Hydrologic Balance <br />Y - Gen. Compliance With Mine Plan <br />N - Other <br />Y - Processing Waste <br />R - Roads <br />N - Reclamation Success <br />N - Revegetation <br />N - Subsidence <br />N - Slides and Other Damage <br />R - Support Facilities On -site <br />N - Signs and Markers <br />N - Support Facilities Not On -site <br />NA - Special Categories Of Mining <br />N - Topsoil <br />COMMENTS <br />This was a partial inspection of the Elk Creek Mine conducted by Mike Boulay of the Colorado Division of <br />Reclamation, Mining and Safety on August 29, 2012. Jim Kiger, Environmental Manager for Oxbow Mining, <br />LLC (OMLLC) was present during the entire inspection. Weather conditions were sunny and warin and ground <br />conditions were dry. The main facilities along the Elk Creek drainage were inspected along with several of the <br />support facility areas. <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, 4.05.10; <br />Diversions 4.05.4; Effluent Limits 4.05.2; Ground Water Monitoring 4.05.13; Surface Water Monitoring 4.05.13; <br />Drainage — Acid and Toxic Materials 4.05.8; Impoundments 4.05.6, 4.05.9; Stream Buffer Zones 4.05.18: <br />Sediment Ponds A, B, D, E, East Yard Pond, and Substation 3 Pond were inspected. Ponds B and D were <br />retaining water. The water levels in both of these ponds were a few feet below the principal spillways. Pond A <br />was retaining only a small amount of water. Ponds E, East Yard and Substation 3 were dry. Pond inlets and <br />embankments were stable and discharge structures at all pond locations appeared to be functional and adequately <br />maintained. No problems were noted at any of the sediment pond locations. <br />ROADS — Rule 4.03 <br />Construction 4.03.1(3)/4.03.2(3) <br />Drainage 4.03.1(4)/4.03.2(4) <br />Surfacing and Maintenance4.03.1(5) and (6)/4.03.2(5) and (6) <br />Reclamation 4.03.1(7)/4.03.2(7): <br />Roads were well maintained and stable. The main access road, the office, warehouse, shop, and the employee <br />parking areas were inspected. Ground surface conditions were dry and all areas were well kept and adequately <br />Number of Partial Inspection this Fiscal Year: 2 <br />Number of Complete Inspections this Fiscal Year: 1 <br />Page 2 of 5 <br />