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Exploration License No. COC-74911 <br />Site Reclamation: <br />Upon completion of drilling and related activities, all drill holes will be backfilled, sealed and <br />abandoned. During drilling, fluid return will be monitored to identify the depth and extent of any water - <br />producing zones. Upon abandonment, in accordance with Drill Hole Plugging Procedures agreed to by <br />BLM and CDRMS, bentonite chips, bentonite plug gel or similar seal will be established in the bottom of <br />the hole, extending to within ten feet of the surface. A cement plug will be set in the hole ten (10) feet <br />below the ground to within three (3) feet of the surface. Accumulations of drill cuttings and mud will be <br />backfilled into and buried in the mud pit (if any) or otherwise buried. <br />All trash and debris will be removed from drill sites for disposal. Excavations, including mud <br />pits, will be backfilled. Where mud pits are necessary, they may be temporarily fenced and allowed to <br />dry and/or backfilled with drill cuttings and/or previously excavated material. During backfilling, the <br />material will be mixed and compacted as it is replaced, by running the equipment over the backfilled area <br />during placement of successive lifts. Following backfilling, disturbance areas will be graded to their <br />approximate original configuration and surface drainage re- established. Any salvaged topsoil materials <br />will be re- spread onto the regraded surface and reseeding of the areas (pads and roads) will take place <br />using the following seed mixture. A metal post with tag will be placed in the vicinity of the hole as a <br />permanent marker. <br />Table 2, <br />Seed Mix for Oakbrush Zone <br />( source: BLM - UFO ) <br />SPECIES % of Mix PLS # /Acre <br />Western Wheatgrass var Arriba 12 8.0 0.96 <br />Slender Wheatgrass var San Luis 12 5.5 0.66 <br />Mountain Brome var Bromar 12 12.5 1.5 <br />Big Bluegrass var Sherman 12 1.5 0.18 <br />Bottlebrush Squirreltail 12 8.0 0.96 <br />Canada Wild rye 12 7.0 0.94 <br />American Vetch 6 10.0 0.6 <br />Rocky Mountain Penstemon 6 1.5 0.09 <br />Western Yarrow 6 1.0 0.06 <br />Total application rate for incorporated seed 5.95 # /acre <br />Seed application rates will be doubled if aerial broadcast methods are used. <br />Seed mix shown in Table 2 above is a standard mix. This mix may vary on private surface <br />depending upon seed mixes agreed to with each surface landowner. Seeding will take place in the fall or <br />early spring. Periodic monitoring of re- seeding efforts and weed control will occur for a couple of field <br />seasons to determine stand success, or until vegetation sustainability allows for Bond release of each <br />drilling sites disturbance. <br />Estimated amounts of coal to be removed during exploration <br />During the exploration drilling process an estimated 8 tons of coal will be recovered from this <br />area. This coal will occur in the form of coal core that is recovered, so that it can be analyzed to <br />determine its physical, chemical, and energy related properties, this will allow for the determination of <br />whether it is of sufficient quality and quantity to allow Oxbow to apply fora coal lease in this area. <br />Coal tonnages removed were calculated by estimating the volume of coal to be removed from each <br />exploration drillhole, times the typical weight of coal at 80 # /cu. ft. as shown below: <br />Volume of coal removed: V= ir r <br />r = 3 inches, h = 12 ft. ave. per seam assume 2 seams of coal encountered. <br />April 10, 2012 9 <br />