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Mr. Ivan Geer May 3, 2013 Gunnison River Gravel Pit Nos. 1 & 5 Substitute Water Supply Plan Page 4 of 7 to meet its replacement obligations under this SWSP. A copy of the contract for Blue Mesa Reservoir water was submitted with the SWSP request and is attached to this letter. A water balance showing the timing of depletions and accretions to the Gunnison River in response to operations at Pit No. 1 and Pit No. 5 is presented in Tables 7 and 8, respectively. As shown, water generated during dewatering will provide replacement to offset, in part, potential out - of- priority depletions to the river during the years each pit is operating. GJPS will annually purchase the additional replacement water required to fully offset potential out -of- priority depletions. A transit loss of 27 percent for Pit No. 1 and Pit No.5 was used to determine the amount of replacement water to be purchased in Blue Mesa Reservoir. For the approval period of this SWSP, the annual water - purchase obligation at Pit No. 1 is 20.90 acre -feet in 2013 and 24.06 acre -feet in 2014 and the annual water - purchase obligation at Pit No. 5 is 7.96 acre -feet in 2013 and 28.21 acre -feet in 2014. The water - purchase obligation for both pits in 2013 is 28.86 acre -feet and for 2014 the water purchase obligation is 52.27 acre -feet. Therefore, GJPS is required to obtain a contract with the U.S. Bureau of Reclamation for a minimum of 28.86 acre -feet for 2013 prior to exposure of any groundwater at Pit No. 1 or Pit No. 5. GJPS is required to obtain a contract with the U.S. Bureau of Reclamation for a minimum of 52.27 acre -feet for 2014 prior to operating Pit Nos. 1 and 5 in 2014. CONDITIONS OF APPROVAL I hereby approve this SWSP in accordance with § 37 -90- 137(11), C.R.S. subject to the following conditions: 1. This SWSP shall be valid from May 1, 2013 through April 30, 2015 unless otherwise revoked or modified. If this SWSP will not be made absolute by a water court action by the plan's expiration date, a renewal request must be submitted to this office with the statutory fee (currently $257) no later than 90 days prior to the expiration date. 2. The Applicant must provide the name, address and phone number of the person who will be responsible for the operation of the SWSP to this office, the Division Engineer, Bob Hurford, and Water Commissioner, Lynne Bixler (both at PO Box 456, Montrose, CO, 81402, telephone 970 - 249 - 6622), within 20 days of the receipt of this approval, and same must be provided on the accounting forms submitted to the division engineer and the water commissioner. 3. Well permit no. 74966 -F, which was issued March 29, 2011, for the operation of Pit Nos. 1 and 5 under the prior approved SWSP, has expired. An application for a new gravel pit well permit for this operation must be submitted to this office and the permit issued before any ground water is exposed under this SWSP. The provisions of § 37 -90- 137(2), C.R.S., prohibit the issuance of a permit for a well to be located within 600 feet of any existing well, unless the state engineer finds that circumstances so warrant after a hearing held in accordance with the procedural rules in 2CCR402 -5. This hearing may be waived if you are able to obtain statements from the owners of all wells within 600 feet, verifying that they have no objection to your use of the proposed well. Should a new well permit be denied for reasons of 600 foot spacing, or any other legitimate reason, approval of this SWSP will be canceled. 4. The total area of exposed groundwater shall not exceed 2.6 acres (2.4 acres at Pit No. 1 and 0.2 acres at Pit No. 5) resulting in 4.33 acre -feet of evaporative loss (3.56