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<br />~~,gNi Op~ <br />w~ _ eF~ <br />O • a <br />~~ ,~ <br />~~~~ <br />Mr. Tom Gillis <br />FE8 1 7 1998 <br />RECEIVED <br /> <br />Colorado Department of Natural Resources <br />Division of Minerals and Geology <br />484 Turner Drive <br />Etuilding F, Suite 101 <br />Durango, CO 81301 <br />I~~r~ <br /> <br />Division of Minerals & Geology <br />GD <br />DEN~/E~ pFFICE <br />PUBLIC FILE COPY <br />FILE: M-~~-~.S~g ~-- <br />S1TE: C-JD--' S""' <br />Received <br />~~ <br />FEB ? , ;~?S <br />Duranno t-i~-!d G'iice <br />Division of P.~.ira~rala a Gro!ogy <br />Subject: New Leaseholder for DOE Lease Tracts C-JD=S, C-SR-13, and C-SR-15 <br />Dear Mr. Gillis: <br />'This is in response to your letters to Ms. Dorothy $lake and Mr. Joe $aldwin, dated <br />February 5, 1998, concerning Colorado Division of Minerals and Geology (DMG) Permits <br />No. M-77-248 (C-JD-S Mine) and M-78-342 (Ellison Mine, C-SR-13), respectively. <br />Please be advised that all rights, title, and interest in the subject lease tracts, on which the two <br />referenced permits are located, have been recently assigned from Telluride Mining Company, <br />Ina, to Gold Eagle Mining, Inc. (GEMI). This assignment was approved by the U.S. Department <br />of Energy (DOE) on February 6, 1998. These assignments also transferred all reclamation <br />liabilities associated with the three lease tracts to GEMI. GEMI, as part of the assigmnent, <br />provided DOE with an irrevocable letter of credit for $80,000 (aggregate sum) to cover the <br />reclamation liabilities that exist on the three lease tracts ($47,000 for C-JD-S, $22,000 for <br />C-SR-13, and $11,000 for C-SR-15). <br />DOE requires a single surety (performance bond, letter of credit, etc.) per lease tract. This surety <br />is all encompassing and covers the reclamation of all environmental disturbances existing on the <br />lease tract as a result of the leaseholder's (or prior leaseholders) mining and exploration <br />activities. Each ]ease agreement specifies the amount of surety required for that particular lease <br />tract. This amount can increase to cover new or expanded operations, or decrease as operations <br />cease and sites are reclaimed. Each lease agreement also requires the leaseholder to comply with <br />all applicable statutes and regulations, including those required by Colorado DMG. <br />The irrevocable letter of credit provided by GEMI will be held by DOE until it is either replaced <br />with another surety of equal value, or the reclamation activities covered by the surety are <br />performed to the satisfaction of all applicable federal and state agencies. <br /> <br />U.S. Department of Energy <br />Grand Junction Office <br />2597 B 3/4 Road <br />Grand Junction, CO 81503 <br />On the basis of the aforementioned lease assigmnents and DOE's receipt of GEMI's irrevocable <br />letter of credit; DOE is in the process of releasing all previous leaseholders and other entities <br />