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STATE OF COLORADO <br />DIVISION OF RECLAMATION, MINING AND SAFETY <br />Department of Natural Resources <br />1313 Sherman St., Room 215 <br />Denver, Colorado 80203 <br />Phone: (303) 866-3567 <br />FAX: (303) 832-8106 <br />December 13, 2007 <br />COLORADO <br />DIVISION O F <br />RECLAMATION <br />MINING <br />-&- <br />SAFETY <br />Bill Ritter, Jr. <br />Scott Wanstedt Governor <br />Blue Mountain Energy, InC. Harris D. Sherman <br />Executive Director <br />3607 County Road #65 <br />Rangely, CO 81648 Ronald W. Cattany <br />Division Director <br />Natural Resource Trustee <br />RE: Quarterly Report Review, 3~d Quarter 2007 <br />Deserado Mine, #C-81-018 <br />Dear Mr. Wanstedt: <br />The Division of Reclamation, Mining and Safety has completed a review of the recent quarterly reports <br />submitted for sediment ponds, refuse piles, and pond discharges for the Deserado Mine. Please find <br />the results of this review under the respective headings below. <br />Sediment Ponds <br />The reports reviewed demonstrate compliance with the requirements of Rule 4.05.9(17). They also <br />meet the additional requirements of Rules 4.05.9(14)(15). Twenty-one ponds at the site are checked for <br />erosion and structural problems as well as function of appurtenant structures and operational status at <br />the time of the inspection. Other than minor maintenance, no issues were identified. <br />Refuse Piles <br />The reports reviewed demonstrate compliance with the requirements of Rules 4.09.1(11) and 4.10.2(2). <br />Please note that a minimum of quarterly inspection is required and for Deserado, more frequent <br />inspection is required during critical construction periods associated with 1) removal of topsoil, 2) <br />installation of surface drainage systems, 3) placement and compaction of materials, and 4) <br />revegetation. Please ensure that these specific activities are inspected and documented by date in the <br />report if they should occur during the quarter. <br />Discharge Monitoring Reports <br />Self-monitoring for sediment pond and impoundment discharge is done monthly at this site. Discharge <br />occurred only at pond DP-1 (excluding raw water lagoon) which is consistent with field inspections <br />conducted during this period by the Division. <br />Office of Office of <br />Mined Land Reclamation Denver Grand Junction Durango Active and Inactive Mines <br />