2012-11-05_REVISION - C1982056 (5)

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Peabod Dear Mr. Musick: 1111 ENERGY Twentymile Coal, LLC Mr. Jason Musick Colorado Division of Reclamation, Mining, and Safety 1313 Sherman Street — Room 215 Denver, Colorado 80203 303.866.3567 Ext. 8134 RECEIVED Divi��v ; „.clarnation, Mining and Safety 29515 Routt County Road 27 Oak Creek, CO 80467 970 879.3800 Re: Twentymile Coal, LLC — Foidel Creek Mine (C -82 -056), Application for Phase 1 Partial Bond Release The State of Colorado, through the Colorado Department of Natural Resources (DNR), currently holds a reclamation bond in the amount of $10,056,089 as surety for final reclamation of mining disturbance areas associated with Twentymile Coal, LLC's (TC) Foidel Creek Mine (Mine). With this application, TC is requesting Phase 1 partial bond release for the following mine disturbance areas, which are no longer needed to support ongoing or anticipated future mining operations, and which have therefore been reclaimed: • CYCC Office Building • Eastern Mining District (EMD) /9 -Right Ventilation Shaft Installation (2.8 acres, 2009 -2010) • 18 -Right Intake Shaft Installation (Pad only - 1.8 acres, 2009 -2010) • Fish Creek Tipple Facility (9.6 acres, 2011 -2012) • Middle Creek Soil Material Stockpile (0.13 acres, 2011 -2012) October 29, 2012 Phase 1 partial bond release is requested for the CYCC Office Building, which was demolished in 2006, 5.6 acres associated with the EMD and 18 -Right shaft installations, reclaimed during 2009 -2010, and for the 9.7 acres associated with the Fish Creek Tipple Facilities and Middle Creek Soil Stockpile reclaimed during 2011- 2012. Reclamation of the EMD and 18 -Right shaft installations included facility demolition and removal, and plugging and sealing of the shaft openings, in accordance with the approved reclamation plans. Reclamation of the Fish Creek Tipple Facilities includes facility demolition and removal for the remaining coal - handling and loadout facilities, except for the railroad spur, substation, and fences. Completion of reclamation for all of these areas also included final backfilling, grading, establishment of drainage controls, and soil material replacement and re- seeding in compliance with the approved reclamation plans and in accordance with applicable regulatory provisions. The total requested Phase 1 partial bond release amount of $312,891 is based on 60 percent of the estimated total reclamation cost for these areas, as calculated in the most - recent (10/13/10 Mid -Term Review and 10/22/08 Detail) Colorado Division of Reclamation, Mining, and Safety (CDRMS) Bond Reclamation Cost Estimate, broken -out as follows: • CYCC Office Building - $79,278 • Eastern Mining District (EMD) /9 -Right Ventilation Shaft Installation - $53,175 • 18 -Right Intake Shaft Installation - $29,227 • Fish Creek Tipple Facility - $151,211 • Middle Creek Soil Material Stockpile — Included in Fish Creek Tipple Facility Release of the total requested amount will result in a remaining surety balance of $9,743,198, which is more than adequate to meet the calculated remaining reclamation obligations.