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Volume III, Exhibit 3 <br />• <br />_Hydro Geo, Inc. <br />Surface & Groundwater Hydrology <br />Technical Memo <br />To: Jim Stover, J.E. Stover & Associates, Inc. <br />CC: Ry Stone, Bowie Resources, LLC <br />From: Joe Frank, HydroGeo, Inc. <br />Date: September 2, 2008 <br />Re: B-Seam and Strata Above B-Seam Water Quality Analysis, Bowie Coal Mine <br />Introduction <br />Collin Stewart of Bowie Resources, LLC (Bowie) contacted Joe Frank of HydroGeo, Inc. (HG) on <br />August 15, 2008 about assisting Bowie and Bowie's consultant, Jim Stover of J.E. Stover & <br />Associates, Inc. (Stover), with the preparation of Bowie's up-coming Mine Permit Revision <br />Application to the Colorado Department of Reclamation, Mining, and Safety (CDRMS). The <br />• CDRMS has stated that they may waive the requirement for additional down-gradient monitoring <br />wells if Bowie can demonstrate that the existing baseline and operational groundwater quality <br />data for the B-Seam and strata above the B-Seam does not vary much from south to north within <br />the current permit area and there is no reason to expect the water quality to change further to the <br />north beyond the current permit boundary (Stover, 2008). The demonstration must satisfy <br />baseline collection requirements of the CDRMS Rules 2.04.7(1) and 2.04.7(4) (c) (Stover, <br />2008). <br />The following professional opinion memo summarizes HG's assessment of the groundwater quality <br />characteristics of the B-Seam and the strata above the B-Seam. <br />Groundwater Quality Analysis <br />HydroGeo reviewed the available water quality data from wells installed in the strata above the B- <br />Seam and the B-Seam as provided by Stover in order to assess whether the data are adequate to satisfy <br />the CDRMS requirements. The analysis focused on chemical parameters of concern as specified in <br />the CDRMS permit regulations: pH (lab and field), total dissolved solids (TDS), total iron, and total <br />manganese. <br />It should be noted that the water quality data from these wells is limited to only a few samples; <br />therefore, any detailed statistical analysis of the data or assessment of seasonal trends is not possible. <br />A summary of the available water quality data is shown in Tables 1 and 2 and time-concentration <br />graphs of the water quality data for each well is presented in Appendix A. <br />September 2008 HydroGeo, Inc. <br />0 <br />FP-16 <br />f3 Prp,aU4-b <br />012.1//6 9