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Interoffice Memorandum <br />To: Janet Binns <br />From: Zach Trujillo <br />Subject: New Elk Mine — Review of New Elk Waste Bank Inspection Reports <br />Date: 8/27/2012 <br />Janet— <br />Three disposal areas were inspected by New Elk Coal Company, LLC and included in their report, the Development <br />Waste Disposal Area (DWDA) south of State Highway 12 and west of the main facility Access Road, the Development <br />Waste Disposal Area #2 located south of State Highway 12 and east of the main facility Access Road, and the Refuse <br />Disposal Area (RDA) located north of State Highway 12 and the Middle Fork of the Purgatoire River. Construction has <br />been completed on the DWDA as well as reclamation of the surface. <br />After my review of New Elks Fourth Quarter Waste Bank Inspection Reports for the year 2011, 1 find the report in <br />compliance with the following rules: <br />1. 4.09.1(11)(a) —The fills were inspected quarterly for stability by a registered engineer during the (4) placement <br />and compaction of fill materials and (5) revegetation period. <br />2. 4.09.1(11)(c) — Rule 4.09(11)(c) is no longer applicable during this stage of construction. <br />3. 4.10.2(2)(a) —The fills were inspected by a registered engineer experienced in construction of similar earth and <br />waste structures. <br />4. 4.10.2(2)(b) —The inspections included the necessary test to evaluate potential hazards to human life and <br />property. None were observed. <br />5. 4.10.2(2)(c) — Steepness of slopes, seepage and other visible factors which could indicate potential failure were <br />considered within the inspections. No signs of instability, erosion or seeps were observed. <br />After my review of New Elks Fourth Quarter Waste Bank Inspection Reports for the year 2011, 1 find the report not in <br />compliance with the following rules: <br />1. 4.09.1(11)(b) —New Elk Mine's DWDA and RDA were inspected on December 29, 2011 and received by the <br />Division on July 30, 2012. A qualified registered engineer should provide to the Division a certified report within <br />two weeks after the inspection that the waste banks are being constructed as specified in the design approved <br />by the Division. <br />Additionally, New Elk did not submit the compaction test results with the Fourth Quarter Waste Bank Inspection Report. <br />The rules do not require these tests to be submitted with the report, but to ensure that the New Elk Coal Company is <br />meeting the minimum compaction requirements, compaction test results would be necessary. It is recommended that <br />future reports include these tests. <br />After my review of New Elk Mine's response to DRMS' letter of July 13, 2012, 1 find the report has clarified all issues <br />addressed. Compaction tests for each of the waste banks inspected were included with this document and meet all <br />minimum requirements. <br />