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OBSERVATIONS <br />PERMIT #: M- 2007 -014 <br />INSPECTOR'S INITIALS: TC1 <br />INSPECTION DATE: March 14, 2013 <br />This inspection was initiated by an application for succession of operator (SO). The focus of this inspection <br />was to assess the operation status and determine what, if any activities might have an impact of the financial <br />warranty liability. Mr. Daniel Tezak represented the new Operator (Byzantine Quarry LLC). <br />The Byzantine Quarry is located in Fremont County, approximately 5 miles northwest of Canon City, CO. The <br />access road is about 2.5 miles north of the intersection of U.S. Hwy 50 and County Road 69. A cable with a <br />lock stretches across the site entrance. The haul road is about 3/4 mile long to the scale house. <br />Inspection: <br />A mine identification sign was prominently displayed at the site entrance (see Photo 1), however no permit <br />number or reference to the Mined Land Reclamation Board (MLRB) is displayed on the sign. This is identified <br />as a potential problem on page 1 of this report. The permit boundary is marked in the form berms, T- posts, and <br />survey markers (see Photos 2 — 4). The marked boundaries appear to be phase 1 only as presented in the <br />original mine plan. The site was not active at the time of the inspection. Mr. Tezak explained this is a dry <br />operation; material is processed without washing (screening only). Mining is currently confined to the phase 1 <br />area of the pit. Highwalls were observed to vary between 15 and 30 feet in height with a single bench. The <br />upper portion of the highwall is roughly at a 1 H:1 V slope with some minor sloughing (see Photo 5). Some <br />material stockpiles were observed (see Photo 6). A small topsoil stock pile was observed on the north end of <br />the pit area. Facilities observed include a small out building, scale house, scale and an above ground petroleum <br />storage tank (see Photos 7 — 8). <br />No exposed groundwater was observed, nor was any stormwater retained onsite. No noxious weeds were <br />observed. <br />File Review: <br />• The previous inspection was a pre- operation inspection for the conversion from a 110c to a 112c permit <br />performed on June 18, 2007. <br />• The total permitted area is 175.31 acres of which 104 acres may be affected area (limited to phase 1). <br />Benches are not to be topsoiled or revegetated. Topsoiling and revege efforts are to be focused on the <br />pit floor and surrounding operations area of about 50 acres. <br />• Annual fees and reports are up to date through 2012. The 2012 annual report indicates mining activity <br />has disturbed a total of 18 acres — all in the phase 1 area. <br />• The current financial warranty is a $216,876 financial warranty (corporate surety) is based on the <br />original permit application. It should be noted that the current reclamation plan assumes 100 percent <br />seeding for all six grass species. This results in a 600 percent seed rate and inflates the reclamation <br />cost. The Operator should submit a technical revision to correct the seed mix in the current reclamation <br />plan. <br />• A revised reclamation cost estimate for the site is enclosed as Attachment A. Unit costs are updated <br />from the original 2007 estimate and include out building demolition and scale removal. <br />Current Stipulations: <br />The following stipulations are compliance requirements pursuant to the original 112c permit approval for the <br />Byzantine Quarry: <br />1. During each year when development and /or production blasting occurs in the quarry, the Operator shall include a <br />geotechnical section into the annual reclamation report providing updated geotechnical observations and measurements and <br />associated recommendations for quarry development to provide a safe highwall during operations and a long term stable <br />Page 2 of 5 <br />