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IXBOW C <br />January 13, 2913 <br />To All Oxbow Mining, LLC Employees, <br />The intent of this letter is to update you on the current situation at the Elk Creek Mine. It is <br />Oxbow's intent to work with MSHA to solve the current situation in the safest manner and to <br />bring the mine back to full production as soon as possible. <br />On December 2, a bounce occurred in the 2 and 3 entries of 5 North from crosscut 19 to <br />crosscut 26, which interrupted ventilation in 5 North and 5 North B. MSHA issued a 103k order <br />required Oxbow to submit plans on any work to be done in the area. After submitting plans to <br />continue mining and meeting with MSHA officials, it was determined that plans to continue <br />longwall mining in 5 North could not be approved. Oxbow then submitted a plan to advance the <br />longwall to the next intersection and recover the longwall face equipment. MSHA approved this <br />plan as well as a plan to drive a new longwall start room at crosscut 8. <br />A second bounce occurred in 5 North on January 2 from crosscut 18 to 19. MSHA modified the <br />previous 103k order restricting all activity in the longwall section. During the investigation of the <br />bump, a slightly elevated level of carbon monoxide (CO) was detected. Increases in CO are an <br />indicator of spontaneous combustion. MSHA has taken a conservative approach and rejected <br />Oxbow plans to continue the longwall mining to recovery. The plan of action is to seal the mine <br />out -by West Mains and to lower the oxygen in the affective area to a level that will not support <br />combustion. This will be done by constructing temporary seals at Main West and then <br />constructing regular seals adjacent to the temporary ones. After the construction of the 120 psi <br />seals, the plan is to resume development of 1 East and 2 East. Construction of the 3 East area <br />will also start at this time. When Oxbow and MSHA have determined that it is safe to re -enter <br />the longwall area, a plan will be submitted to recover the longwall equipment and move it to 1 <br />East. <br />It is our goal to minimize the production delay while safely addressing the problem in the mine <br />understand the impact that this is having on you and your families. We are striving to resolve <br />this as quickly as possible while maintaining the safety of the people involved in this work. <br />We will keep in contact with you to inform you of the progress of these steps and of the work <br />that will be available_ Please do not hesitate to call for additional information. <br />Bes Regards <br />/Y/; h: <br />Mike Ludlow <br />, i ?? . €3.0. Box 535 • Somerset, Colorado 81 4134 USA <br />li-A. (970) 424 -5122 • FAX (970) 929 -5177 <br />