2013-04-18_REVISION - C2009087 ‎(2)‎

• Permit No: C2009087
• IBM Index Class Name: Revision
• Doc Date: 4/18/2013
• Doc Name: Midterm Review Performance Bond Reduction Amount Letter
• From: DRMS
• To: Peabody Sage Creek Mining, LLC
• Type & Sequence: MT1
• Email Name: JDM
• Email Name: DIH
• Media Type: D
• Archive: No

STATE OF COLORADO
DIVISION OF RECLAMATION, MINING AND SAFETY
Department of Natural Resources
1313 Sherman St., Room 215
Denver, Colorado 80203
Phone: [phone]
FAX: [phone]
April 18, 2013
B. Scott Cowman
Peabody Sage Creek Mining LLC
P.O. BOX 250
36600 Routt County Road 27
Hayden, CO 81639 -0250
Re: Peabody Sage Creek Mine (Permit No. C- 2009 -087)
Midterm Review Performance Bond Reduction
Dear Mr. Cowman:
COLORADO
ID I V I S I O N O F
RECLAMATION
MINING
SAFETY
John W. Hickenlooper
Governor
Mike King
Executive Director
Loretta E. Pineda
Director
A summary of costs and the addition to any revision adjustments was compiled for the 2013 Midterm Review of
the Peabody Sage Creek Mine. As of February 20, 2013, the Division estimated liability at the Peabody Sage
Creek Mine is $4,954,779.34. This amount is sufficient to assure completion of the remaining reclamation work
at the site if the work had to be performed by the Division, including the cost of re- establishing vegetation on
any revegetated areas, should those areas fail. The permittee currently has on deposit with the Division one cash
bond in the amount of $6,160,431.65.
Based on the updated costs of associated revisions the direct costs for all reclamation tasks is $3,949,764.10.
This is less that the direct costs of $4,735,596, calculated for the Peabody Sage Creek Mine upon approval.
Indirect costs consist of the Overhead and Profit costs and the Legal, Engineering, and Project Management
costs. Overhead and Profit costs consist of Liability Insurance (% of direct cost), Performance Bond (% of direct
cost), Job Superintendent (hourly), and Profit (% of direct cost) which make up the Contract Amount (direct cost
+ Overhead and Profit). The Legal, Engineering, and Project Management Costs consist of Engineering Work
(% of contract amount), and Reclamation Management (% of contract amount) for a Total Indirect Cost of
$1,005,015.24.
Per Rule 3.02.2(4), before any adjustment to the performance bond, the Division is required to provide the
permittee with an opportunity for an informal conference on the adjustment. This letter serves as the notice to
permittee. If the Division does not receive an informal conference request from Peabody Sage Creek Mining,
LLC concerning this bond reduction by April 30, 2013. The Division will issue a written proposed decision on
the bond reduction amount per Rule 3.02.2(4)(b).
If you have any questions or concerns, please contact me.
Sincerely,
Jason D. Musick
En- 6ronmental Protection Specialist
Office of Office of
Mined Land Reclamation Denver • Grand Junction • Durango Active and Inactive Mines