The Applicant provided copies of the Water Court Decree No. 85CW117. In the decree, and from comments provided by the Division of Water Resources, the Applicant is entitled to divert a minimum of 10.4 acre-feet a year from Left Hand Creek and store the water underground for use at the mill site. The Applicant will measure the amount of water divert using a continuous recording measuring device. Water will only be removed from creek between April 1 and October 31 as water is available. The decree contained a dry covenant, the Applicant has stated that irrigation activities ceased when the water right was established. If irrigation of the land is taking place using creek water, it is being done illegally and not within the control of the Applicant. The Division finds the Applicant has complied the applicable Rules 3.1.6(1)(a) and 6.3.3, and C.R.S. § 34-32-112.5.

The Gold Hill Mill will contain all water used during the milling process and will not discharge any water to Left Hand Creek. Water contained within the tailings material will evaporate from the Tailings Storage Facility (TSF). The TSF will be recertified prior to any milling taking place at the site. The pipeline leading from the creek to mill will be constructed with equipment to prevent any backflow from occurring to creek.

The Applicant will be collecting quarterly surface water samples from Left Hand Creek as part of the Groundwater and Surface Water Sampling and Analysis Plan for the site. The monitoring plan includes quarterly samples collected from five (5) groundwater monitoring wells, the Times- Wynona shaft, and TSF. The Applicant has provided a plan protective of Left Hand Creek and a monitoring plan that will allow the Applicant and the Division to verify the effectiveness of the plan. The Division finds the Applicant has complied the applicable Rules 3.1.6, 3.1.7, 6.3.3 and 6.4.21(10) and C.R.S. § 34-32-112.5.

The Applicant proposes to remove the relic pipeline materials during construction of the new pipeline. The conversion application states that at the end of milling operations all pipeline and pumphouse materials will be removed in accordance with the Reclamation Plan. The pumphouse and fuel tanks are proposed to be located outside of the 500-year floodplain. The location of the proposed pipeline from pumphouse will be located on land owned by the U.S. Forest Service (USFS). Prior to any construction occurring on USFS land, the Applicant would first need to obtain a Plan of Operations and approval from the USFS. The Division finds the Applicant has complied the applicable Rules 6.3.3 and 6.3.4.

The EPP has been designed to minimize the impacts to the hydrologic balance of the groundwater system. A thorough groundwater monitoring plan has been designed to verify the effectiveness of the EPP. In the application, the Applicant has committed to sampling five (5) groundwater monitoring wells at the site, which includes one point-of-compliance well. These wells along with

the TSF, Times-Wynona Shaft, and Left Hand Creek will be sampled on quarterly basis. Sampling reports containing the results of the collected samples will be submitted a month following the end of the previous quarter. The Groundwater and Surface Water Sampling and Analysis Plan (SAP) has an expanded number of locations to be sampled along with an expanded analyte suite to aid in comparison of data. Groundwater samples will be compared to the standards contained in WQCD Regulation 41 – The Basic Standards for Ground Water. The plan will allow for a comparison of the existing mine pool water quality to the surrounding wells. The SAP includes a quality control and quality assurance protocol according to current industry standards. The SAP is an improvement over the currently approved monitoring plan contained in the 110(2) Permit. If data gaps are identified during the monitoring process, the Division would require that the SAP be updated to adequately address any gaps. The Division finds the Applicant has complied the applicable Rules 3.1.7, 6.3.3 and 6.4.21 C.R.S. § 34-32-116.

The Mill site is located on Boulder Creek Granodiorite which is characterized to be massive to gneissic. Groundwater flow within the granodiorite is controlled by localized fracturing, joints and voids. In general, these flow paths decreases with depth. Between the mill and the Town of Gold Hill is the Hoosier Reef. The Reef is a mapped structure that is 10 to 80 feet wide and extends over 1,000 feet deep and is composed of silicified breccia that is barrier to groundwater flow. The Reef runs southeast to northwest. Fractures around the site also trend southeast to northwest but meet the Hoosier Reef towards the Town of Gold Hill thus preventing groundwater flow from the site reaching the town. A comparison of groundwater elevations at the site to available groundwater level data in the town indicates there is a significant difference in overall water elevations indicating the mill site and town are separated and the water levels are reflective of localized fractured flow. An additional indication of the relative impermeability of the granodiorite is the difference in the Times-Wynona Shaft water level relative to the surround groundwater monitoring wells. The mine pool water elevation is typically higher than the surrounding monitoring wells, an indication of the lack of interconnectedness within the granodiorite. The Division finds the Applicant has complied the applicable Rules 3.1.7, 6.3.3 and 6.4.21 and C.R.S. § 34-32-116.

The Applicant has committed to a recertification schedule to determine the condition of the Tailings Storage Facility (TSF). If the TSF can be recertified, a schedule for the completion of the recertification activities will be submitted through a Technical Revision pursuant to Rule 6.4.21(15). If it is determined the TSF cannot be recertified, a schedule for reclamation will be submitted through a Technical Revision according to the approved reclamation plan. Recertification of the TSF is a requirement of Rule 7.3.2. The recertification process provides a framework to insure the TSF has suitable capacity to prevent a release of materials from a design storm event plus operational material volumes during worst case conditions. Additionally, the recertification process will verify stability of the TSF embankments meet the minimum requirements for stability in accordance with Mined Land Reclamation Board Policy 30 for Factors of Safety for Slope Stability/Geotechnical Analyses and Rule 6.5. At a minimum, no milling activities may take place until the TSF is recertified. If

the TSF is reclaimed, no milling activities may take place until an alternative tailings disposal method is approved by the Division. In order to gain Division approval of the recertification of the TSF, the Applicant must comply with Rules 6.3, 6.4.21, 6.5 and 7.4.

At this time there are designated chemicals awaiting EPA approval for proper disposal at a certified disposal facility. The chemicals were identified during the pre-operation inspection in October 2023. The chemicals are being stored inside the mill building, protected from the weather and within secondary containment, until the EPA provides the proper documentation allowing for proper disposal of the chemicals. Following proper disposal, and prior to any designated chemicals being handled or stored at the site, the Applicant must submit and get Division approval, through individual Technical Revisions, for the following Environmental Protection Facilities (EPF); Mill Facility, Reagent Storage Facility, Tailings Delivery Line, Tailings Storage Facility (mentioned above) and the Surface Ore Stockpile Facility. Each Technical Revision for the individual EPFs will be reviewed by the Division and must meet the applicable requirement of Rules 6.4.21, 6.5, 7.3, and 7.4. The EPF’s will not be considered certified for operations until all applicable QA/QC documentation and certified as-builts have been submitted and accepted by the Division. No milling may take place until all EPFs are accepted by the Division.

The application conversion includes a Materials Containment Plan and a Spill Prevention, Control and Countermeasure (SPCC) Plan for the site. The SPCC Plan will provide measures for properly storing and handling petroleum products and responding to, and reporting, spills. Normally, the SPCC Plan covers only petroleum-based chemicals but the SPCC Plan contained within the conversion application for this site includes inspection and reporting requirements for the chemicals stored at the processing facility. The Material Containment Plan will provide guidance for the storage, use, cleanup, training, and reporting associated with the use of mill chemicals on site. The SPCC Plan also addresses response actions in the event of a site emergency. Additionally, the Applicant provided an Emergency Response Plan (ERP) as required by Rules 6.4.21 and 8.3. The ERP describes procedures that are intended to be followed during an emergency situation at the Gold Hill Mill. These plans will be reviewed and updated as needed once all the EPF’s have been accepted by the Division.

All chemicals used at the site will be stored according to manufactures specifications and MSDS guidance. Transportation of chemicals to and from the mill will be completed by a licensed supplier following, at a minimum, the appropriate regulations set by the Department of Transportation, OSHA, and Boulder County.

No milling activities may occur at the site until all the EPF’s have been accepted and approved by DRMS. Upon Division approval the Applicant will have complied with Rules 6.4.21, 6.5, 7.3, 7.4 and 8.3.

Concerns the TSF would be used by birds. During the comment period the Division received a comment letter from the Colorado Parks and Wildlife (CPW). In the letter, CPW did not express any concerns the site will have a significant effect to local wildlife. The Applicant followed up again with CPW to verify this statement in April 2023 and CPW reiterated there were minimal biological concerns. Currently there is fence around the TSF that prevents large wildlife from coming into contact with tailings material. Recertification of the TSF will also evaluate the need for additional or improved measures to prevent wildlife exposure to tailings. The Division finds the Applicant has complied with required by Rules 6.3.2(d) and 6.4.21(18).

In these proceedings, the Division’s jurisdiction is limited to enforcement of the specific requirements of the Act and Rules. While other issues are recognized as important, the Division does not have the authority to address them. The Division considers all timely submitted objections and comments in its review but can address only the issues that directly relate to the specific requirements of an application as stated in the Act and Rules.

The Act and Rules do not specifically address impacts to visually appealing landscapes, aesthetics, hours and/or days of operation, noise pollution and impacts to the viewshed, and quality of life. Such issues are typically addressed at the local government level and not at the State government level. These issues should be addressed through Boulder County.

The Act and Rules do not specifically address air quality issues. Such issues are under the jurisdiction of Boulder County and the Air Pollution Control Division (APCD) of the Colorado Department of Public Health and Environment (CDPHE). The Applicant has affirmatively stated in Exhibit F of the CN1 application that an Air Pollution Permit will be obtained prior to operations.