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PQabody C Twentymile Coal Apri13, 2007 Mr. Cazl Johnston Office of Surface Mining Reclamation and Enforcement 1900 Broadway -Suite 3320 Denver, Colorado 80201 (303) 844-1500 29515 Routt County Road 27 Oak Creek, CO 60467 970.879.3800 REC~'' s-~ APK U ~ i:uu1 Division of Recianiauon, Mining and Safety Re: Twentymile Coal Company -Foidel Creek Mine (Permit C-82-056), Technical Revision TR07-59 - Changes in Water Balance and Update of Windy Gap Analysis Dear Mr. Johnston: Twentymile Coal Company (TCC) has applied for approval of applicable permits to construct and operate a new Washplant, in order to maintain and enhance the quality of our coal product, consistent with changes in geologic conditions and market demand. Projected increases in production to 12.0 MM tons per year (clean coal), and the addition of the new Washplant, will result in increases in consumptive use and the addition of surface moisture to the washed coal. Given these anticipated changes, with this submittal, TCC has updated the mine water balance and Windy Gap Analysis accordingly. The original Windy Gap Analysis for the Foidel Creek operations was completed in 1986, and the required one-time mitigation payment was made, based on consumptive use under an 8.0 MM ton per year production scenario. The Analysis was revised and updated in 1997, to reflect changes in consumptive use associated with an increase in annual production to 10.0 MM tons. Currently, the only surface water that TCC uses in its mining and related operations is a limited amount of surface runoff/spoil spring discharge (approximately 163.6 acre-feet per yeaz) from a large on-site reservoir, previously constructed as a combination sedimentation structure and storage reservoir in conjunction with historic surface mining activities in the area. The lazge majority of the water used in ongoing operations comes from ground water sources, predominately mine inflows, with a small amount coming from TCC's existing potable water well. It is not anticipated that these system inputs will change significantly over the remaining life-of--mine. TCC has an active ongoing mine water recycling program, where both mine and process water aze recycled to underground storage reservoirs in sealed and abandoned underground mine workings for reuse. As a result, little or no dischazge to surface drainages occurs, consumptive use is limited to surface moisture shipped with the coal product and evaporative losses, and any variance between system inputs and losses translates into changes (plus or minus) in ground water storage, as indicated by the attached Table E51-25, Simplified Water Balance.