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• III IIIIIIIIIIIIIIII • ,: sss AZURITE, INC. 10001 CR 1 2 P.O. Box 338 COTOPAXI, CO 8 1223 (7 19) 942-41 78 FAX: (7 t 9) 942-4 1 78 Aucusr 23, 1995 MR. JOHN CARD DOMTAR GYPSUM 337 ARGYLE STREET NORTH CALEDONIA, ONTARIO CANADA RE: REVIEW OF COALDALE CLOSURE COSTS IN REGARDS l'O EQUIPMENT AND STRUCTURAL DEMOLITON, AS DISCUSSED, NO VALUES PLUS OR MINUS WILL BE INCLUDED IN THIS CLOSURE COST REVIEW. SHOULD THE SALE OF THE PROPERTY PROCEED, IT WILL UNDOUBTEDLY BE WITH BUILDINGS AND CRUSHER IN PLACE. COST AREA ONE-GOLD HILL HIGH WAIL THE ORIGINAL MINE PLAN CALLS FOR THE REMOVAL OF ALL LOOSE VENEER GYPSUM FROM THE FOOTNALL CONTACT, A BLACK LIMESTONE BED DIPPING AT APP. SS DEGREES. IF THIS CONTACT PORTRAYS ADEQUATE STABILITY, THE CLEANED HIGHWALL SHOULD BE ADEQUATE FOR FINAL RECLAMATION. THIS WILL ENTAIL THE DEPLOYMENT OF A CRANE/DRAGLINE TO SCRAPE THE CONTACT CLEAN OF ALL LOOSE MATERIALS. BULLDOZER WORK TO GRADE OUT HIGHWALL BENCHES TO ORIGINAL SHAPE AS MUCH AS POSSILE ALONG THE EASTERN END OF GOLD HILL WILL BE NECESSARY. LIMITED GRASS AND SCHRUB ESTABLISHMENT CAN BE ACHIEVED ON THE RECONTOURED LOWER EASTERN SHOULDER OF GOLD HILL. ONE IMPORTANT FACTOR AT THIS LOCATION IS THE CONDITON OF THE LOWER LIMESTONE BED. IF PROVEN TO BE UNSTABLE, BULLDOZER AND POSSIBLY BLASTNG MAY BE NECESSARY TO RECONFIGURE THE GOLD HILL HIGHWALL CONTACT. THE AREA IS APPROXIMATE FIVE ACRE5. FINAL RECLAMATION COST MAY RUN BETVEEN $30K- I OOK. COST AREA TWO-GOLD HILL AND SENATORE HILL ORE BENCHES THIS AREA WOULD BE MINED OUT ENTRELY IF THE ORIGINAL MINE PLAN WAS EXECUTED. ACCORDING 'IO THE ORIGINAL PLAN, THE PIT AREA WOULD BE BACKFILLED VIA BULLDOZER PUSH OF WASTE MATERIALS FROM THE NEARBY SENATORE DUMP, DUE NORTH OF THE PIT. THE SENATORE DUMP WOULD ENCROACH ON THE THE PIT NEAR THE END OF LIFE OF MINE. IN THIS CASE, THE RECLAMATON COST WOULD APPROACH $3OK FOR THE EIGHT ACRE AREA, HOWEVER, THE STATE WILL APPROACH THIS AREA BASED ON CLOSURE COST/TODAYS DISTURBANCE AND WILL NOT NECESSARILY ASSUME THAT MINING OF THE GYPSUM WILL BE COMPLETED PRIOR TO CLOSURE. IF THIS IS T}1E CASE, A CLOSURE COST ESTIMATE WOULD BE MUCH GREATER. FROM THE STANDPOINT OF THE IMPACT ON PURCHASE PRICE, THIS INCREASE CAN NOT BE INCLUDED IN THE PURCHASE PRICE SINCE THE WORK WOULD NOT PERFORMED UNTIL FINAL CLOSURE. STATE DIVISION OF MINERALS AND GEOLOGY WILL HAVE THE FINAL SAY ON THE ESTIMATE OF CLOSURE COST FOR THIS AREA OF CONCERN.