2000-09-13_REVISION - M1977493 (3)

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Petition for Partial Relec Financial Warranty Climax Molybdenum CoffVany Permit #M-77 493 September 1, 1999 would be a permanent solution to the wind erosion problems and to on-going water erosion of the fine-grained tailings on the dam face. Following engineering planning and design, field construction was initiated in June 1997. Approximately 3 months later, on September 12, 1997, the capping project was completed. During construction, approximately 364,000 cu. yds. of cap material was excavated from two borrow areas, one on each side of the base of the dam, and placed on the face. The average depth of material as verified by ASI engineers is 2 feet, a thickness that meets the criteria as approved in the 1989 Amendment - . The cap was constructed with 8 benches across the face and 200' slope distances. The average final slope is 3.5:1, well within permitted reclamation requirements. Figure 11 shows the final grading and reclamation plan and cross- sections of the cap. In addition to grading and capping No. 3 Dam, the borrow areas near the base of the dam were graded and reclaimed as were areas C 19 and C20 from the 1989 permit amendment. During its annual inspection of Climax on September 4, 1997, DMG noted the completion of the capping project and found it to be in compliance with the permit. Figure 1 locates the completed No. 3 Dam capping project as well as the regraded borrow and ancillary sites from the 1989 permit amendment. Figures 12 and 13 are photographs of the area prior to, during, and following reclamation work. Figures 14 and 15 show the area as of July 1999. Grading work on the No. 3 Dam area is 100 percent complete. Therefore, Climax seeks a reduction in warranty for this area of. ,$735,691, the total amount for grading listed in Section 4.7, page 65 of the present warranty document. 3.4 Mayflower Tailings Area The Mayflower tailings impoundment, located just downstream of No. 3 Dam, was designed and constructed in the early to mid-1970s when it became evident to Climax that additional tailings storage capacity was required. The impoundment is 346 acres and the dam, No. 5 Dam, is 20 acres. Only the tailings area is the subject of this petition. The impoundment accepted mill tailings into the early 1980s when the world market for molybdenum declined and operations at Climax were severely curtailed. At this time, Climax implemented operational decisions that designated the Ten Mile tailings impoundment as the active tailings area. The Mayflower impoundment became the primary water treatment facility for the Climax property. The existing water pool became, in essence, a large alkaline-precipitation holding and treatment system allowing Climax to meet its permitted water quality discharge limitations in Ten Mile Creek below the impoundment. As with the No. 3 Dam (Section 3.3) and the Robinson tailings area (Section 3.5), blowing tailings dust from the dried beach areas was a growing concern and became a regulatory issue in the mid-1980s. At that time, Climax determined that capping the beach areas and dam with 100419/Climax/Report.doc 7