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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 />September 29, 2009 <br />Mr. Stephen Hilgers <br />Cats-International ?/ <br />6499 Plateau Drive <br />Englewood, CO 80111 <br />ac", " <br />1000 C®NFCDRTAL <br />v <br />RE. Santiago Mine, Second Review of Notice of Intent, File No. P-2009-005 <br />Dear Mr. Hilgers: <br />COLORADO <br />D I V I S I O N OF <br />RECLAMATION <br />MINING <br />SAFETY <br />Bill Ritter, Jr. <br />Governor <br />Harris D. Sherman <br />Executive Director <br />Ronald W. Cattany <br />Division Director <br />Natural Resource Trustee <br />The Colorado Division of Reclamation, Mining, and Safety (DRMS) has reviewed the supplementary <br />information provided on August 31, 2009 in support of the above referenced Notice of Intent to Conduct <br />Prospecting (NOI). Based on that review, DRMS has determined that the NOI remains incomplete. Please <br />address the following items at your earliest convenience bearing in mind that if you have not addressed these <br />items within sixty days of the date of this letter the DRMS may terminate this NOI (rule 5.1.3 of the Mineral <br />Rules and Regulations of the Mined Land Reclamation Board). <br />1. The August 31, 2009 submittal states that milling might commence in 2011. DRMS understands that this <br />is a projected schedule, not a request for approval to conduct milling, and hereby notifies you that no milling <br />is allowed under this NOI. <br />2. The August 31, 2009 submittal requests approval to make mill building and equipment repairs during <br />2010. You may make the repairs with or without an NOI, with the following limitations: <br />a. No substantial milling equipment may be brought onto the site. <br />b. No additions to or enlargements of the buildings may occur. <br />The activities listed in a and b above may be considered "development" of the mining and milling facilities <br />as that term is used in rule 1.1(31), and may require a mined land reclamation permit to proceed. <br />3. The August 31, 2009 submittal requests approval to start construction on the footing for proposed <br />impoundment D during 2010. The DRMS has determined that this would constitute development work, and <br />cannot be done under an NOI. Therefore, the request to commence construction of impoundment D is <br />denied. <br />4. For the purposes of this NOI, and based on the information provided in the August 31, 2009 submittal, <br />DRMS has determined that reclamation bond for removal of the access gate will be required. DRMS is <br />deferring the cost estimating to determine the total amount of required bond for this NOI until after responses <br />to this letter have been provided. <br />Office of Office of <br />Mined I and Rarlamatinn Dp.nvPr . Grand Iunctinn . I7uran¢n Artiva and Inartiva MinP,.