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OBSERVATIONS <br />PERMIT #: M- 2006 -017 <br />INSPECTOR'S INITIALS: BMK <br />INSPECTION DATE: February 7, 2013 <br />1) The Division conducted an inspection of the site to verify the fact that the operator had conducted the <br />required reclamation of all the affected areas disturbed during the mining phase. The operator has <br />submitted a properly executed succession of operation application and wants to lower the required <br />reclamation warranty for the site. <br />2) The site is a 112 sand and gravel operation located approximately 8 miles NE of Hanover Colorado. The <br />operation has been in temporary session since 7/1/2010. <br />3) Present during the inspection was Mr. James Burns of Premier Silica. The entire 9 acres affected has <br />been reclaimed. The operator wants a reduction in financial warranty by changing the total affected <br />acres throughout the life of mine at any given time from the current 34 acres to 10 acres. The access <br />road to the property will remain in place to allow access to the 299 acres of permit area post mining <br />and reclamation. <br />4) The Division will reduce the warranty from the current $243,500.00 to $64,439.00 for 10 maximum <br />affected acres at any given time. In order to execute a reduction in the financial warranty, the operator <br />must first post the $243,500.00 already in place in Primer Silica's name. This will finalize the transfer of <br />the permit. Once this process is completed, Primer Silica will submit a Technical revision reducing the <br />maximum affected acres from the current 34 acres to 10 by providing a new mining and reclamation <br />plan map. The maximum affected acres through the life of mine will still be 34 acres. Once the technical <br />revision reducing the maximum affected acres is approved, the operator will submit a surety reduction <br />request in accordance with Rule 4.17 of The Construction Materials Rules and Regulations and the <br />warranty will be reduced to $64,439.00. This will be a reduction in maximum affected acres of 24 acres <br />at any given time and a reduction in financial warranty of $179,061.00. <br />5) The operation is in compliance with the approved reclamation permit. <br />Page 2 of 4 <br />