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Ouray Silver Mines, Inc. <br />1900 Main St. Unit 1 <br />PO Box 564 <br />Ouray, CO 8I427 <br /> <br />To: Travis Marshall <br />Colorado Division of Reclamation, Mining, and Safety <br />1313 Sherman Street. Room 215 <br />Denver, Colorado 80203 <br />From: Brian K. Briggs, CEO <br />Date: January 18, 2018 <br />Subject: Exceedance in GW -3A and Replacement of GW -3A <br />DURAY SILVER <br />RECEIVED <br />JAN 2 3 201 <br />DIVISION Of RECLAMATION <br />MINING AND SAFETY <br />Ouray Silver Mines Inc. (OSMI) owns and operates the Revenue-Virginius approximately 6 miles south <br />west of Ouray Colorado under the Colorado Division of Reclamation, Mining, and Safety (DRMS) permit <br />number M2012-032 (Permit). OSMI performs quarterly sampling at monitoring wells and in surface <br />water according to Technical Revision number 9 of the Permit. Recently, OSMI notified DRMS of the <br />need to replace well GW -3A because of a damaged well casing or failed annulus. During Q4 sampling, <br />GW -3A water quality exceeded the Pb groundwater standard (0.044 mg.'L) with a detection of 0.0644 <br />mg?L. The Ag concentration in GW -3A, 0.0007 mg.'L, also exceeded the groundwater standard (0.0001 <br />mg!L). All other constituents and locations were with permit requirements. Because of the known <br />problems with the well, the fact that the exceedance is within round i ng.'reporti ng. error, and the planned <br />replacement, OSMI has not resampled the well as required by the permit. If DRMS would like OSMI to <br />resample the well for Pb and Ag, please contact us. <br />The replacement well, GW -3R, was installed on November 28, 2017. GW -3R is located immediately <br />downgradient of the infiltrating water, and is screened from 17 to 27 feet below ground surface (between <br />the infiltration gallery elevation and above the surface water elevation). Water was encountered at 17.5 <br />feet below ground surface. The well was installed on November 28, 2017_ Sampling will occur during Q 1 <br />2018. <br />Additionally, sampling at the MWPInlet was discontinued for safety reasons. OSMI intends to continue <br />sampling the water entering the Mine Water Pond at station UG -5, just before the water enters the pipe to <br />the Mine Water Pond, rather than were it exits (MWPinlet). Unfortunately, voluntary monitoring at <br />MWPlnlet/UG-5 did not occur during Q4 2017. UG -5 will be sampled during Q 1 2018, and updates will <br />be included in an upcoming Technical Revision. <br />Please do not hesitate to call me with concerns or questions at 970-325-9830. <br />S.i elry, - <br />Bria K. riggs, PE <br />CEO, Ouray Silver Mines Inc. <br />Phone: (970) 325-9830 ♦ Fax: (970) 325-9824 <br />