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2011 and 2012 Phase III Bond Release Evaluation <br />Year 1 and Year 2 <br />Snowcap Coal Company <br />1.0 INTRODUCTION <br />1.1 General <br />Cedar Creek Associates, Inc. (Cedar Creek) was contracted in 2011 and 2012 by Snowcap Coal <br />Company (Snowcap) to evaluate revegetated units for Phase III bond release at Snowcap Mine (a.k.a. <br />Powderhorn Coal Co. — Roadside Mine). Sampling efforts were conducted in 2011 and 2012 in the <br />interest of ascertaining progress toward revegetation success of on- the - ground revegetation in general <br />accordance with Rule 3.03, Release of Performance Bonds and the approved Technical Revision 60 (TR- <br />60). This report includes evaluation of the Greasewood Comparison Revegetation Areas, the Shadscale <br />Comparison Revegetation Areas, and their corresponding reference areas, the Greasewood Reference <br />Area and Shadscale Reference Area. <br />Sampling in 2011 and 2012 was conducted on 16 individual reclamation units at Snowcap ranging in <br />size from less than an acre to 20.2 acres. In addition to the reclaimed units on the mine permit area, <br />there are 22 smaller sites associated with drilling and exploration that are included in this Phase III <br />evaluation. The revegetated areas evaluated in 2011 and 2012 were separated into two sampling units <br />based on the reference area used for comparison, as per TR -60. All areas to be compared to the <br />Greasewood Reference Area (6 units) were treated as a single combined unit (Greasewood Comparison <br />Revegetation Areas) and systematically sampled. The same procedure was utilized for all areas to be <br />compared with the Shadscale Reference Area (33 units) and treated as a single combined unit ( Shadscale <br />Comparison Revegetation Areas). Accordingly, the Greasewood and Shadscale Reference Areas were <br />evaluated to provide comparison values for the revegetation units. At the time of sampling, revegetation <br />within evaluated units had experienced at least nine growing seasons since the completion of seeding or <br />reseeding. The locations of all sampled areas are shown on Map 1 and sampling points within each unit <br />are indicated on Maps 2 — 13 in Appendix A. <br />Field sampling for the directly measurable variables of ground cover, production, and woody plant <br />density were systematically conducted within the reclaimed areas as well as within the two reference <br />CEDAR CREEK ASSOCIATES, Inc. Page 1 Snowcap - Phase III Bond Release <br />Evaluation - 2012 <br />