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Battle Mountain Resources, Ina <br />San Luis Project <br />P.O. Box 310 <br />San Luis, Colorado 81152 -0310 <br />(719) 379 -0798 <br />August 28, 2013 <br />Mr. Wally Erickson <br />Colorado Department of Reclamation, Mining, & Safety <br />1313 Sherman, Room 215 <br />Denver, CO 80203 <br />Re: Battle Mountain Resources, Inc. <br />San Luis Project — Permit No.M -88 -112 <br />TR -32 Response Plan - Monitoring Well M -14 TDS <br />Dear Mr. Erickson: <br />RECEIVED <br />SEP 0 3 2013 <br />DIVISION OF RECLAMATION <br />MINING AND SAFETY <br />This letter constitutes the response plan proposed by Battle Mountain Resources, Inc (BMRI) in regard to <br />the observed exceedance in the TDS concentration at the groundwater monitoring point of compliance M- <br />14 at the San Luis Project. This plan is submitted in accordance with the requirements outlined in <br />Technical Revision 32 (TR -32). <br />BMRI received the final analytical report from SVL Laboratories on August 2, 2013 for the second <br />verification sample (collected July 1, 2013) for Total Dissolved Solids (TDS) at monitoring well M -14. <br />In the second verification sample, the TDS reported concentration of 595 milligrams per liter (mg/1) <br />exceeded the 500 mg/1 TDS Permit Condition Value assigned to this well. This result was lower than the <br />initial sample collected on April 23, 2013, which had a reported concentration of 633 mg/1. The first <br />verification sample collected on May 23, 2013, had a reported TDS concentration of 587 mg/l. <br />BMRI and Advanced Environmental Sciences, Inc. (AESI) performed a preliminary review of the TDS <br />exceedance in monitoring well M -14. This review included the verification of the laboratory analyses <br />performed, review of the current and historical water quality parameters (including TDS), and a review of <br />sampling or other field operations which potentially impact the TDS results. <br />A verification of the laboratory analytical data found that the laboratory was utilizing their standard <br />operating procedure for the analysis of TDS and this procedure is based upon the Standard Methods for <br />the Examination of Water and Wastewater Method A2540 C. Laboratory quality control (QC) samples <br />were analyzed with each analytical batch and included laboratory duplicate samples. Laboratory <br />duplicate QC samples were found to have acceptable duplicate sample precision. Based upon the <br />analytical method utilized and the review of the quality control samples performed with these samples, <br />there was no indication that the laboratory sample preparation or analysis is contributing significantly to <br />the TDS variability observed. <br />At monitoring well M -14, iron, manganese, sulfate TDS, pH and WAD cyanide are the established permit <br />parameters for this point of compliance. Recent historic data have not shown iron or WAD cyanide <br />