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Denison Mines Environmental Protection Plan - Sunday Mine

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Environmental protection plan for the Sunday uranium mine in San Miguel County, Colorado, filed for state review on Jan. 23, 2012.
79
dEN150NO MINES VIA Email AND US MAIL January 20 2012 Mr Bob Oswald Environmental Protection Specialist State of Colorado Division of Reclamation Mining and Safety Department of Natural Resources 1313 Sherman St Room 215 Denver CO 80203 Dear Mr Oswald Re Operator Acceptance of Amendment Requirements Permit Numbers Denison Mines USA Corp Denison received minor email comments from you on November 19 2011 and November 22 2011 Denison has addressed these minor comments and is presenting a final EPP with this letter All previously tracked changes and edits have been accepted and Section 14 0 Construction Schedule has been revised An entirely new up front document is submitted for your review and acceptance M 1977 285 Sunday Mine Amendment AM3 Please feel free to contact me if you have any additional questions or concerns Yours very truly DENISON MINES USA CORP M 1977 416 Carnation Mine Amendment AM 1 M 1978 039 HR St Jude Mine Amendment AM 1 M 1980 055 HR Topaz Mine Amendment AM 1 M1981 021 West Sunday Mine Amendment AM 1 With one minor modification Christy Woodward PE Environmental Coordinator cc Denison Mines USA Corp File CDM Inc File Denison Mines USA Corp 1050 17th Street Suite 950 Denver CO 80265 USA Tel 303 6287798 Fax 303 3894125 www denisonmines com tJ Jki y p Vq a STR v c n o N cC i 1 ti
Transcript
Page 1: Denison Mines Environmental Protection Plan - Sunday Mine

dEN150NOMINES

VIA Email AND US MAIL

January 20 2012

Mr Bob Oswald

Environmental Protection SpecialistState of Colorado

Division of Reclamation Mining and SafetyDepartment of Natural Resources1313 Sherman St Room 215Denver CO 80203

Dear Mr Oswald

Re Operator Acceptance of Amendment Requirements Permit Numbers

Denison Mines USA Corp Denison received minor email comments from you on November 19 2011 andNovember 22 2011 Denison has addressed these minor comments and is presenting a final EPP with thisletter All previously tracked changes and edits have been accepted and Section 140 Construction Schedule hasbeen revised An entirely new up front document is submitted for your review and acceptance

M1977285 Sunday Mine Amendment AM3

Please feel free to contact me if you have any additional questions or concerns

Yours very truly

DENISON MINES USA CORP

M1977416 Carnation Mine Amendment AM1

M1978039 HR St Jude Mine Amendment AM1

M1980055 HR Topaz Mine Amendment AM1

M1981021 West Sunday Mine Amendment AM1

With one minor modification

Christy Woodward PEEnvironmental Coordinator

cc Denison Mines USA Corp FileCDM Inc File

Denison Mines USA Corp1050 17th Street Suite 950

Denver CO 80265USA

Tel 303 6287798

Fax 303 3894125

wwwdenisonminescom

tJ Jki y p Vq a STRvcno NcCi1

ti

Page 2: Denison Mines Environmental Protection Plan - Sunday Mine

ENVIRONMENTAL PROTECTION PLAN

DENISON MINES USA CORP

SUNDAY MINES GROUP

JANUARY 2012

Prepared by

CDM Inc

555 17th Street Suite 1100

Denver CO 80202

and

Denison Mines USA Corp1050 17th Street Ste 950

Denver Colorado 80211Ph 3036287798

Fax 3033894125

Y

P t

SUNDAY MINE PERMIT M1977285CARNATION MINE PERMIT M1977416

ST JUDE MINE PERMIT M1978039HRTOPAZ MINE PERMIT M1980055 HR

WEST SUNDAY MINE PERMIT M1981021

Page 3: Denison Mines Environmental Protection Plan - Sunday Mine

Contents

Table of Contents

Section 1 Introduction 1

11 Site Description 11

12 Purpose 11

13 Regulatory Framework 12

Section 2 Potential for Adverse Impacts 2

21 Description of Specified Mine Facilities 21

211 Development Rock Piles 22

212 Temporary Ore Stockpiles 23

22 Evaluation of Potential for Adverse Impacts at Specified Facilities 23

221 Designated Chemicals 24

222 Acid and Toxic Producing Materials 24

223 Acid Mine Drainage 25

Section 3 Environmental Protection Measures and

Monitoring Required by Other Agencies 3

31 Environmental Protection Measures and Monitoring by StatuteRegulation or Permit 31

32 List of Other Permits and Licenses 32

Section 4 Designated Chemicals Evaluation 4

Section 5 Handling of Designated Chemicals and AcidOr Toxic forming Materials 5

Section 6 Evaluation of Proposed and Existing Environmental ProtectionFacilities 6

61 Proposed Ore Storage Pad with Geomembrane Liner 61

611 Proposed Ore Storage Pad Design 61

612 Evaluation of the Proposed Environmental Protection Facilities 62

Section 7 Groundwater Information 7

71 Local Geologic Framework 71

711 Sunday and Carnation Mines 71

712 St Jude Mine 71

713 West Sunday Mine 72

714 Topaz Mine 72

72 Potential Aquifers in Area of Sunday Mines Group 72

721 Sunday and Carnation Mines 73

722 St Jude Mine 74

723 West Sunday Mine 74

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724 Topaz Mine 74

73 Potentially WaterBearing Fractures Zones 75

74 Direction and Rate of Groundwater Flow 75

741 Area of Underground Workings 75

742 Surface Affected Areas 77

Section 8 Groundwater Quality Data 81

81 Regional Groundwater Quality 81

82 Local Groundwater Quality 81

83 Existing and Future Groundwater Uses 85

Section 9 Surface Water 91

91 Perennial and Intermittent Surface Water 91

92 Design Specifications for Stormwater Management Facilities 91

93 Stormwater Runoff Detention Basins 92

94 Stormwater Management Plan Maintenance and Inspection Program 92

Section 10 Surface Water Quality Data 101

Section 11 Water Quality Monitoring Plan 111

111 Surface Water Monitoring 111

112 Groundwater Monitoring 111

1121 Monitoring Well Locations 112

1122Monitor Well Location and Aquifer Testing 114

1123 Groundwater Sampling 114

1124 Evaluation of Groundwater Monitoring Data 115

Section 12 Climate 121

121 Annual Precipitation 121

122 Direction and Velocity of Prevailing Winds 121

123 Mean Monthly Temperatures and Ranges 122

124 Evaporation Rates 122

Section 13 Geochemical Data Analysis 131

131 Naturally Occurring Geological and Geochemical Conditions 131

132 Mine Rock Geochemistry 132

1321 Assessment of Potential Acid Forming Rock 132

1322Assessment of Potential Toxic Forming Rock 132

Section 14 Construction Schedule 141

Section 15 Construction Quality AssuranceQuality Control Plan 151

Section 16 Plant Growth Media and Revegetation 161

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Section 17

171

172

173

174

Section 18

Section 19

Wildlife Protection 17

Threatened Endangered and Sensitive Species 171

Migratory Birds 172

Wildlife in Contact with Development Rock 172

Protection of Wildlife 173

Disposal of Tailings and Mine Sludge in Mine Workings 18

References 19

iv

Table of Contents

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Exhibits

v

Table of Contents

21 Summary of the Status of Specified Facilities at the Sunday MinesGroup

22 Type Status and Size of Specified Facilities

31 Federal State and Local PermitsApprovals Required

71 Definition of Local Hydrogeologic Units in Vicinity of theSunday Mines Group

72 Estimated Hydraulic Gradient

73 Estimated Linear Groundwater Velocity

81 Wells Located in General Vicinity of Sunday Mines Group

131 Estimated Percolation through Development Rock Areas forAverage Precipitation

132 Estimated Percolation through Development Rock Areas forWettest Year on Record

133 Summary of UNSATH Modeling Results

151 PVC 30 mil Geomembrane Liner Specifications Used in BuriedApplications

171 Threatened and Endangered Species List

Page 7: Denison Mines Environmental Protection Plan - Sunday Mine

Tables

Table of Contents

81 Characteristics of Hydrogeologic Units in Paradox Basin

82 Comparison of West Sunday Mine Well Data February andMarch 2009

121 Monthly Total Precipitation Data from Uravan ColoradoWeather Station

122 Average Monthly Wind Speed and Direction Data GrandJunction Colorado

123 Monthly Average Maximum and Minimum Temperatures atUravan Colorado Weather Station

124 Pan Evaporation Data at Dead Horse Creek near NaturitaColorado

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Figures

Table of Contents

11 Site Location Map

21 Carnation Mine Site Facilities Permit M1977416

22 St Jude Mine Surface Facilities Permit M1978039 HR

23 Sunday Mine Surface Facilities Permit M1977285

24 Topaz Mine Permit M4980055 HR

25 West Sunday Mine Site Facility Permit M1981 021

71 Sunday Mines Group Area Geologic Map

72 SundayCarnation Mine Area Geologic Cross Section A A

73 St Jude Mine Area Geologic Cross Section B B

74 West Sunday Mine Area Geologic Cross Section C C

75 Topaz Mine Area Geologic Cross Section D D

76 SundayCarnation Mine Area Interpretive HydrogeologicFramework

77 St Jude Mine Area Interpretive Hydrogeologic Framework

78 West Sunday Mine Area Interpretive Hydrogeologic Framework

79 Topaz Mine Area Interpretive Hydrogeologic Framework

81 West Sunday Mine Area Cross Section Showing Wells Installed

111 Sunday Mines Group Proposed Monitoring Well Locations

112 Schematic Cross section Showing Monitoring Well Locations

121 Box Plot Showing Monthly Precipitation Summary StatisticsUravan Colorado

122 Total Annual Precipitation Uravan Colorado

123 Wind Rose Chart Grand Junction Colorado

124 Average Monthly Precipitation Versus Pan Evaporation UravanColorado and Naturita Colorado

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131 Comparison of Acid Potential to Neutralization Potential

132 Comparison of NPAP Ratio to Total Sulfur

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Table of Contents

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Attachments

Table of Contents

A Transportation Policy for Shipments of Colorado PlateauUranium Ores to the White Mesa Mill

B Environmental Geochemistry Investigation of Rock and SoilMaterial Sunday Group Mines

C Summary of Monitoring Requirements Required by OtherAgencies

D Colorado Department of Public Health and Environment AirPollution Control Division Construction Permit

E Office of the State Engineer Colorado Division of WaterResources Well Permit

F CDPS General Permit Stormwater Discharge COR040223 andStormwater Management Plan

G Septic System Permit 97024S

H San Miguel County Special Use Permit 199718 updatedresolution 200841

I San Miguel County Road Use Permit for County Road 20 R

J Plan of Operations Decision Record

K Environmental Assessment Finding of No Significant Impact

L National Emissions Standards for Hazardous Air Pollutants

NESHAPs Compliance Plan

M Sunday Mines Spill Prevention Pollution Control andCountermeasure Plan SPCC

N Groundwater Characterization Data Collection Work Plan to

Address Designated Mining Operations Status Sunday MinesGroup San Miguel County Colorado

O Hydrogeological Evaluation of Sunday Mines Group

P Drainage Report for Denison Mines Sunday Mine Group SanMiguel County Colorado

Q Sunday Stormwater Repair and Maintenance 2008 memorandum

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Table of Contents

R Development Rock Ore and Soil Characterization DataCollection Work Plan to Address Designated Mining OperationsStatus Sunday Mines Group and Van 4 Mine San MiguelCounty Colorado

S Ore Storage Pad Drawings and Specifications

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Acronyms

ABA Acid Base Accounting

AMSL Above Mean Sea Level

BCC Birds of Conservation Concern

BLM US Bureau of Land Management

BMP Best Management Practices

Board Colorado Mined Land Reclamation Board

BSGW Basic Standards for Ground Water

CaCO3 eq calcium carbonate equivalent

CDOW Colorado Division of Wildlife

CDPHE Colorado Department of Public Health and theEnvironment

CDPS Colorado Discharge Permit System

CFR Code of Federal Regulations

CMLRA Colorado Mined Land Reclamation Act of 1976

cm sec Centimeters per second

CRS Colorado Revised Statutes

Division Division of Reclamation Mining and Safety

DMO Designated Mining Operation

DOT US Department of Transportation

DRA Development Rock Areas

DRMS Division of Reclamation Mining and Safety

EPA US Environmental Protection Agency

EPF Environmental Protection Facility

EPP Environmental Protection Plan

xi

Table of Contents

Page 13: Denison Mines Environmental Protection Plan - Sunday Mine

F

ET

Fahrenheit

Evapotranspiration

Table of Contents

ft Feet

HB Colorado House Bill

HELP hydrologic evaluation of landfill performance

HRMMR Colorado Hard RockMetal Mining Rule Mineral RulesRegulations of the Colorado Mined Land ReclamationBoard for Hard Rock Metal and Designated MiningOperations

HV Horizontal to Vertical

in inches

MBTA Migratory Bird Treaty Act

mgL Milligrams per liter

MSDS Material Safety Data Sheet

MSHA Mine Safety and Health Administration

MWMP Meteoric Water Mobility Procedure

NESHAP National Emissions Standards for Hazardous AirPollutants

NNP net neutralization potential

NOAA National Oceanic and Atmospheric Administration

NPAP ratio between the neutralization potential and the acidpotential

PIF Colorado Partners in Flight

RSL Regional Screening Levels

RMC Risk Management Criteria

SPCC Spill Prevention and Countermeasure Control

SWCC Soil Water Characteristic Curve

SWMP Stormwater Management Plan

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TDS Total Dissolved Solids

tkt tons per kiloton

TMDL Total Maximum Daily Loads

USFWS United States Fish and Wildlife Service

USGS United States Geological Survey

Table of Contents

Page 15: Denison Mines Environmental Protection Plan - Sunday Mine

10 Introduction

11 Site DescriptionThe Sunday Mines Group is a group of five existing underground uraniumvanadiummines located San Miguel County Colorado as shown in Figure 11 The mines arecurrently permitted under individual state permits however the mines are located invery close proximity and all mines are operated by Denison Mines USA CorpDenison Therefore Denison manages these operations as the Sunday Mines Groupwhich includes

The Sunday Mine

The Carnation Mine

The St Jude Mine

The West Sunday Mine and

The Topaz Mine

The mines are located in southwestern Colorado approximately 17 miles southwest ofNaturita Colorado Specifically the permit boundary of the Sunday Mines Group islocated in Sections 101113through 15 and 22 through 26 Township 44 NorthRange 18 West New Mexico Principal Meridian San Miguel County ColoradoDenisonsclosest local mine office is in Egnar Colorado located approximately 18miles southwest of the mine

12 PurposeThe Colorado Division of Reclamation Mining and Safety Division providedNotices of Determination of Designated Mining Operation DMO to Denison onFebruary 8 2008 for all five of the mines that encompass the Sunday Mines Group Inaddition existing state mine reclamation law was modified by Colorado House BillHB 1161 on May 20 2008 This new law expands the definition of a DMO to includeconventional uranium mines such as the Sunday Group mines However these rulesare being promulgated now but are not currently in place An environmentalprotection plan EPP is required for all DMOs under current state law Therefore anEPP has been prepared in accordance with existing laws and regulations for theSunday Group Mines

The Sunday Mines Group is currently permitted as follows

The Sunday West Sunday and Topaz Mines are 112d permits regular operationswith permit numbers of M1977285 M1981021 and M1980055HR respectively

The Carnation and St Jude mines are 1102dpermits with permit numbers of M1977416 and M1978039HR

C UserscwoodwardOesktopSundaysFINAL Environmental Protection Plan Sunday Mines Revised January 2012 docx

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Page 16: Denison Mines Environmental Protection Plan - Sunday Mine

Toxic or acidic chemicals used in extractive metallurgical processing arepresent on site

Environmental Protection Plan means a plan submitted by a designatedmining operation for approval as part of the Operatorsor Applicantspermitfor such operation pursuant to rules promulgated by the boardfor protectionof human health or property or the environment in conformance with theduties of operators as prescribed by this article

In addition the CMLRA 343211252CRS provides for exemption of a minefrom DMO status if

CUserscwoodwardrDesktopSundaysFINAL Environmental Protection Plan Sunday Mines Revised January 2012 docx

Section 1Introduction

This document provides an EPP for the Sunday Mines Group Although the fivemines are currently permitted with individual state mine permits this documentaddresses environmental protection at all five mines This document is submitted as apermit amendment to each of the five existing permits to most efficiently comply withthe Division designation

13 Regulatory FrameworkThe Colorado Mined Land Reclamation Act CMLRA 3432 Colorado Revised

StatutesCRSwas amended via Colorado HB 1161 as signed into law by theGovernor on May 20 2008 The revised statute changed the definition of a DMO toinclude all uranium mine operations including conventional underground uraniummines such as the Sunday Mines Group

As defined by the CMLRA 343210335aCRSa designated mining operationmeans mining at which

Acid or toxic forming materials will be exposed or disturbed as a result ofmining operations or

Uranium is developed or extracted either by in situ leach mining or byconventional underground or open mining techniques A uranium miningoperation may seek an exemption from designated mining operation status inaccordance with 342311252CRS

The Colorado Mined Land Reclamation Board Board has not yet promulgated therevised administrative rules that address the expanded definition of DMOs to includeall uranium mines as set forth in Colorado HB 1161 Therefore specific directionregarding compliance with Colorado HB 1161 for conventional uranium mines is notyet present in the Mineral Rules and Regulations of the Colorado Mined LandReclamation Board for Hard Rock Metal and Designated Mining OperationsHRMMR

This classification of the Sunday Mines Group as a DMO requires the preparation ofan EPP for the Sunday Mines Group An EPP is defined by the CMLRA 3432103

49CRS

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Page 17: Denison Mines Environmental Protection Plan - Sunday Mine

an operator demonstrates to the board at the time of applyingfor a permit orat a subsequent hearing that toxic or acid chemicals are not stored or used onsite and that acid or toxic producing materials will not be used stored ordisturbed in quantities sufficient to adversely affect any person any propertyor the environment

Section 1

Introduction

Denison has prepared this EPP in accordance with Denisonscorporate commitmentto environmental protection and their obligation for protection of human healthproperty and the environment in conformance with the duties of operators asprescribed by the CMLRA

This document is generally organized in accordance with existing rules at HRMMR6420 However as mentioned previously the rules have not yet been modified toprovide specific direction for conventional uranium mines designated as DMOs byColorado HB 1161 Therefore the organization of this document has been modifiedsomewhat to address site specific issues This document is organized as follows

Section 20 Potential for Adverse Impacts HRMMR 64201and642014

Section 30 Environmental Protection Measures and Monitoring Required by OtherAgencies HRMMR 64203and64204

Section 40 Designated Chemicals Evaluation HRMMR 64205

Section 50 Handling of Designated Chemicals and Acid or Toxic formingMaterials HRMMR 64206

Section 60Evaluation of Proposed and Existing Environmental ProtectionFacilities HRMMR 64207

Section 70 Groundwater Information HRMMR 64208

Section 80 Groundwater Quality HRMMR 64209

Section 90 Surface Water HRMMR 642010

Section 10 Surface Water Quality Data HRMMR 642011

Section 11 Water Quality Monitoring Plan HRMMR 642012

Section 12 Climate HRMMR 642013

Section 13 Geochemical Data and Analysis HRMMR 642014

Section 14 Construction Schedule HRMMR 642015

Section 15 Construction Quality Assurance Quality Control Plan HRMMR642016

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Section 1

Introduction

Section 16 Plant Growth Media and Revegetation HRMMR 642017

Section 17 Wildlife Protection HRMMR 642018

Section 18 Disposal of Tailings and Mine Sludge in Mine Workings HRMMR642019 and

Section 19 References

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Page 19: Denison Mines Environmental Protection Plan - Sunday Mine

Specified Facilities Facility Status

Leach facilities or heap leach pad Not Present

Tailings storage or disposal areas Not Present

Impoundments Not Present

Waste rock piles development rock stockpiles Present

Stock piles temporary or permanent Present

Land application sites Not Present

20 Potential for Adverse ImpactsHRMMR 64201provides for evaluation of potential adverse impacts associatedwith designated chemicals toxic or acid forming materials or acid rock drainage atmine facilities This section identifies facilities present at the Sunday Group Mines inrelation to the requirements of HRMMR 64201and presents general discussionregarding the potential for these facilities to contain designated chemicals toxic oracid forming materials or acid rock drainage

21 Description of Specified Mine FacilitiesHRMMR 64201csets forth various types of mine facilities that require specificevaluation for the presence of designated chemicals and acid or toxic formingmaterials Exhibit 21 describes the types of specified facilities that are present at theSunday Mines Group in relation to HRMMR 64201c

ibit 21 Summary of the Status of Specified Facilities at the Sunday Mines Grou

Only development rock stockpiles are present at the Sunday Mines Group Thesestockpiles are comprised primarily of Top Rim sandstone It is commonly mediumgrained well rounded gray sandstone with calcite cement The grain size of the rockparticles ranges from fine sand to boulders The medium diameter is approximately 2inches based on a general visual evaluation Local zones also contain reddishbrowncalcareous sandstone which was mined from units adjacent to the Top Rimsandstone During mine operations there are also temporary ore stockpiles consistingof similar Top Rim sandstone material However since June 2009 the mine has beenunder temporary cessation status and there are currently no temporary ore stockpilesat the mine

Development rock is rock that must be excavated to facilitate mine development butthat does not contain adequate metals content to constitute ore Development rockpiles are located at each of the individual mines that compose the Sunday MinesGroup Ore is rock that contains sufficient uranium and vanadium to warrantprocessing at the Denison mill near Blanding Utah Temporary ore stockpiles arecurrently located at the Sunday St Jude West Sunday and Topaz mines thetemporary stockpiles are typically transported to the mill on a daily to weekly basis

Exhibit 22 describes the type status and size of specific facilities at each mine withinthe Sunday Mines Group

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Page 20: Denison Mines Environmental Protection Plan - Sunday Mine

Mine Facility Status ApproximateAcreage

Sunday Mine Low Grade Ore

Stockpile TemporaryStockpile

Active preexisting facility 27

Development RockStockpile

Active preexisting facility 78

Temporary OreStockpile

Active preexisting facility 01

Carnation Mine Development RockStockpile

Pre existing facility surface facilities arecurrently inactive

3

Temporary OreStockpile

None currently planned NA

St Jude Mine Development RockStockpile

Active preexisting facility 43

Temporary OreStockpile

Active preexisting facility 01

West SundayMine

Development RockStockpile

Active preexisting facility 35

Temporary OreStockpile

Active preexisting facility 02

Topaz Mine Development RockStockpile

Active preexisting facility 19

Temporary OreStockpile

Active preexisting facility 01

2 Type Status and Size of Specific Facilities

C UserscwoodwardDesktopSundaysFINAL Environmental Protection Plan Sunday Mines Revised January 2012 docx

Section 2

Potential for Adverse Impacts

211 Development Rock Piles

All of the development rock areas are pre existing facilities and many of thesefacilities predate both state and federal mine reclamation regulations Each of the fiveSunday Mines contains a development rock area at the main surface facility as shownon Figures 21 through 25 Mining activity was observed on 1950s era topographicmaps in the area and the Sunday Mine and Carnation Mine appear on topographicmaps as early as 1960 The development rock piles at the Sunday Mines Group comefrom various ages of operations dated generally as follows

Carnation Mine historical shown on 1950 USGS map permit dated 1977

Sunday Mine shown on 1960 USGS map permit dated 1977

West Sunday Mine Permit dated 1981

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St Jude Permit dated 1978

Topaz Permit dated 1979

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Section 2

Potential for Adverse Impacts

The development rock piles were initially constructed during driving of the accesstunnels into the mines and additional rock is placed on the facilities during the minedevelopment process Surface work at the Sunday mine began in 1973 in an areaadjacent to the original old Sunday Mine with a double shift operation driving thefirst 800 feet ft of decline to the known ore intercepts and breaking into the oldSunday Mine Workings Ore production started in February 1974 with ore shipmentsgoing to an offsite mineral processing mill In March 1981 the West Sunday Minewas started by driving a 2400 ft decline to ore body The decline as of May 1984 was600 feet deep No production had come out of the West Sunday as of 1984

212 Temporary Ore StockpilesNo mineral processing is conducted at the Sunday Mines Group and therefore ore isonly present in temporary stockpiles Ore is typically transported from the mine viaend dump haul trucks and dumped directly into temporary ore stockpiles Thesestockpiles are located in close proximity to the portal entrances directly on thedevelopment rock piles Stockpile areas are shown on Figures 21 through 25 Thearea of a typical ore stockpile is approximately 01 to 02 acres The ore is loaded fortransport to the mill when an estimated 1000 to4000 tons of ore are available in theore stockpiles Ore is removed and transported to the DenisonsWhite Mesa Mill inUtah as frequently as daily to weekly

Ore is transported in accordance with US Department of Transportation DOTregulations found in Title 49 Code of Federal Regulations CFR 171 which sets forthDOT requirements for shipping of source material including uranium ores Consistentwith this regulation Denison has in place a current Transportation Policyfor Shipmentsof Colorado Plateau Uranium Ores to the White Mesa Mill dated July 5 2007 included asAttachment A The truck beds are covered with tarps that fit tightly over the top edgeof the truck and are secured approximately one foot below the top edge of the truck toprevent fugitive dust emissions

22 Evaluation of Potential for Adverse Impacts at SpecifiedFacilities

In accordance with HRMMR 64201this section provides evaluation of thepotential for adverse impacts related to designated chemicals acid or toxic formingmaterials or acid mine drainage at the Sunday Mines Group Denison has completedextensive geochemical characterization work on development rock and ore at theSunday Mines Group This section provides a summary of the results of this workAdditional information is presented in Section 13 of this document and inEnvironmental Geochemistry Investigation of Rock and Soil Material Sunday Group MinesCDM 2009 which is included in this document as Attachment B

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221 Designated ChemicalsAs defined in the HRMMR1113

222 Acid and Toxic Producing MaterialsAs defined in the HRMMR 11 1

Section 2

Potential for Adverse Impacts

Designated Chemicals are toxic or acidic chemicals used within the permitarea in extractive metallurgical processing the use ofwhich at certainconcentrations represents a potential threat to human health property or theenvironment

By definition designated chemicals are chemicals used in extractive metallurgicalprocessing and as previously stated extractive metallurgical processing is notconducted at the Sunday Mine Group Therefore no designated chemicals are presenton site

Acid and Toxic Producing Materials means natural or reworked earthmaterials having acid or toxic chemical and physical characteristics thatunder mining or postmining conditions of drainage exposure or otherprocesses produce materials which contain detrimental amounts of chemicalconstituents such as acids bases or metallic compounds

Detailed evaluation of acid base accounting ABA data field observations andmeteoric water mobility procedure MWMP data indicate that the development rockand ore are extremely unlikely to generate acid rock drainage and are not consideredacid forming material

The potential for stockpiled development rock and ore to be classified as toxicforming was evaluated by considering two pathways for potential toxic effects

Direct contact risks and

Potential development of toxic leachate

Preliminary screening of direct contact risks based on comparison of total metalsconcentrations to toxicity screening levels provided by US Bureau of LandManagement BLM and EPA indicate that most metals including uranium andvanadium do not exceed the screening criteria and therefore do not present directcontact risks However this preliminary screening indicated that potential arsenicrisks related to direct contact with arsenic should be investigated further Thereforeadditional evaluation of potential direct contact risks related to arsenic was conductedto evaluate the bioavailability of arsenic in stockpiled ore and development rock Thisassessment included specific invitro assays electron microbe analyses and detailedevaluation of potential direct contact risks This work concludes that available data fordevelopment rock present at the Sunday Mines Group does not suggest significanttoxic forming potential

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The potential for the development rock to generate toxic leachate was evaluated usingMWMP testing and evaluation of the volume of percolation that would be expectedfrom the piles The MWMP testing indicates that the rock could release dissolvedconstituents into pore water within the pile if sufficient water were present at themines However the mines are located within an arid area and detailed analyses ofpercolation from the piles using water balance estimates and unsaturated flowmodeling indicates that generation of significant quantities of leachate from the pilesis unlikely These analyses show that water infiltrating into the piles would beexpected to be removed by evaporation in the arid environment at the Sunday MinesGroup this is validated by the absence of visual drainage from development rockstockpiles that have been in place for decades

Based on the evaluations of potential direct contact risks and risks related todevelopment of leachate from the piles summarized above neither the developmentrock nor the ore are considered Acid or Toxic Producing Materials Additional detailon the evaluation of acid and toxic producing materials is included in Attachment BEnvironmental Geochemistry Investigation of Rock and Soil Material Sunday Group Minesand Section 13 Geochemical Data Analysis

223 Acid Mine DrainageAs defined in the HRMMR 11 2

CUserscwoodwardDesktopSundaysFINAL Environmental Protection Plan Sunday Mines Revised January 2012 docx

Section 2

Potential for Adverse Impacts

Acid Mine Drainage means contamination of water by low pH or heavymetals that occurs from mined or disturbed materials as a result of thechemical and biological oxidation of reactive sulphide minerals when exposedto air and water The possibility ofgenerating Acid Mine Drainage existswhere the pH of any exposed or potentially exposed overburden waste rockmill tailings waste water treatment sludge or other mined placed disposed orstockpiled material has the potential to develop a pH of58 or less

As previously stated development rock and ore are unlikely to generate acid minedrainage

Based on these conclusions no designated chemicals or acid or toxic formingmaterials are present at the Sunday Mines Group Additional details on theseevaluations are included in Attachment B Environmental Geochemistry Investigation ofRock and Soil Material Sunday Group Mines and Section 13 Geochemical Data

Analysis

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30 Environmental Protection Measures and MonitoringRequired by Other AgenciesThe following sections identify the environmental protection measures andmonitoring requirements by other agencies and a list of permits and licenses

31 Environmental Protection Measures and Monitoring byStatute Regulation or PermitThe Sunday Mines comply with federal state and local laws and regulations TheSunday Mines are also consistent with Rangeland Health Standards and Guidelinesand do not affect any tribal lands held in trust for the tribes by the federalgovernment More than three dozen federal environmental laws and regulationsapply to all aspects of mining at the Sunday Mines Group The following are themajor laws governing mining

Surface Resources Act at 43 CFR subpart 3715 regulates residency orseasonal occupancy of mining claims by mining claimants and requiresoccupancy to be authorized by the proper BLM field office through a notice orplan of operations

Federal Mining Law at 43 CFR subpart 3809 Surface Management Programrequires proper permits and authorizations for mineral exploration mining

and reclamation actions on the public lands administered by BLM

National Environmental Policy Act requires interdisciplinary approach toenvironmental decision making

Federal Land Policy and Management Act requires the prevention of undueand unnecessary degradation of federal lands

Clean Air Act sets air quality standards

Federal Water Pollution Control Act Clean Water Act directs standards to

be set for surface water quality and for controlling discharges to surface water

Safe Drinking Water Act directs standards to be set for quality of drinkingwater supplied to the public states are primary authorities and regulatesunderground injection operations

Solid Waste Disposal Act regulates the generation storage and disposal ofhazardous waste and management of solid non hazardous waste

Endangered Species Act mandates protection for plants and animals listedthat are threatened or endangered

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Section 3

Environmental Protection Measures and Monitoring Required by Other Agencies

Migratory Bird Treaty Act prohibits killing of nearly all bird species

Other laws that impact mining include

Colorado Water Rights Law

Rivers and Harbors Act

Mining Law of 1872

National Historic Preservation Act

Law Authorizing TreasurysBureau of Alcohol Tobacco and Firearms toRegulate Sale Transport and Storage of Explosives and

Federal Mine Safety and Health Act

32 List of Other Permits and Licenses

Known federal state and local permits required are identified by type and entitybelow All required permits are issued in Denisonsname Regulatory requirementsfor these permits are associated with the regulations discussed in the previous sectionand lists of environmental protection measures associated with these permits aresummarized in Attachment C

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Permit Approval Entity Attachment Provided

Air Quality Emissions Permit infinal review with CDPHE

Colorado Department of PublicHealth and Environment CDPHEDivision of Air Quality

Attachment D

Well Permit 66209F Office of the State EngineerColorado Division of Water

Resources

Attachment E

National Emissions Standards for

Hazardous Air Pollutants Title VAir Permit

United States Environmental

Protection AgencyAnnual Reporting

No Permit Provided

Colorado Discharge Permit SystemCDPS General PermitStormwater Discharge COR040223

CDPHE Water Quality ControlDivision

Attachment F

Septic System Permit 97024STopaz Mine

San Miguel County Department ofBuilding and Health

Attachment G

San Miguel County Special UsePermit 199718 updated resolution200734

San Miguel County Attachment H

San Miguel County Road UsePermit for County Road 20 R

San Miguel County Attachment I

Plan of Operations DecisionRecord

BLM Attachment J

Environmental Assessment Findingof No Significant Impact

BLM Attachment K

National Emissions Standards forHazardous Air Pollutants

NESHAPs Compliance Plan

EPA Region 8 Attachment L

Section 3

Environmental Protection Measures and Monitoring Required by Other Agencies

Exhibit 31 Federal State and Local PermitsApprovals Required

Plans and additional information associated with these permits include

Sunday Mines Stormwater Management Plan Attachment F with permit

Sunday Mines Spill Prevention Pollution Control and Countermeasure PlanSPCC Attachment M

BLM Plan of Operations provided upon request

BLM Environmental Assessment provided upon request

Five separate Division of Reclamation Mining and Safety DRMS permitsthis document is an amendment to these plans therefore they are notprovided

Significant modeling was completed for the Sunday Mines Air Permit and canbe provided to the Division upon request

San Miguel County Permit Application provided upon request and

Annual NESHAPs reporting for active operations provided upon request

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40 Designated ChemicalsEvaluationAs previously stated designated chemicals are not present at the Sunday MinesGroup Extractive metallurgical processing is not conducted at the Sunday MineGroup The ore produced at the mines is shipped to the Denison mill near BlandingUtah for processing

Small volumes of other chemicals such as petroleum products and additivesantifreeze non chlorinated solvents chemical suppressants or equivalent for dustcontrol and other small volume non designated chemicals are stored onsite Thestorage handling and use of these non designated chemical products are discussedin further detail in the Spill Prevention and Countermeasures Control SPCC Plan Acopy of this plan is included as Attachment M

Safety and handling of these chemicals occurs as specified in their respective materialsafety and data sheets MSDS as required by Mine Safety and Health AdministrationMSHA regulations MSDSs for these non designated chemicals will be providedupon request

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50 Handling of Designated Chemicals and Acid orToxic forming MaterialsAs discussed previously designated chemicals are not present at the Sunday MinesGroup Therefore information regarding handling disposal decommissioningdetoxification or stabilization of designated chemicals is not applicable to the SundayMines Group

Furthermore no acid or toxic forming materials or acid mine drainage are present atthe Sunday Mines Group Therefore additional information regarding handling ofthese types of materials is not applicable to the Sunday Mines Group Generalinformation regarding development rock piles and ore stockpiles is present in permitdocuments previously submitted to the Division and is incorporated into thisdocument by reference

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60 Evaluation of Proposed and Existing EnvironmentalProtection Facilities

An environmental protection facility EPF is defined by HRMMR1115 as follows

Environmental Protection Facility means a structure which is identified inthe Environmental Protection Plan as designed constructed and operatedfor control and containment ofdesignated chemicals acid mine drainage ortoxic or acidforming materials that will be exposed or disturbed as a result ofmining and reclamation operations

Although geochemical assessment of ore has indicated that the material is not toxicforming from a risk management criteria RMC perspective as a best managementpractice Denison has designated ore storage pads as EPFs for the Sunday MinesGroup Production and storage of ore is not currently being conducted at the SundayMines Group Prior to resuming these operations Denison will construct ore padsthat are compliant with DRMS General Ore Pad Construction Criteria Denison iscommitted to providing containment of surface water in contact with ore material Asummary of design for the ore storage pads including the use of a geomembraneliner is provided below The complete ore storage pad designeg specifications anddrawings is provided as Attachment S

61 Proposed Ore Storage Pad with Geomembrane LinerThe ore stockpile areas at the Sunday Mines Group are currently located at the StJude Sunday Topaz and West Sunday Mine sites The construction of an ore storagepad is not planned for the Carnation Mine ore is not produced at this mine Ore istemporarily stored at these stockpile locations and is routinely transported by truck tothe White Mesa Mill near Blanding Utah for processing ore is typically stored forrelatively short time periods of one to two weeks less than 180 days Ore storagepads will be constructed at each of these stockpile areas to contain surface waterduring future ore storagestockpiling activities

611 Proposed Ore Storage Pad DesignThe existing ore stockpile areas will each be replaced with an 80ft by 80ft proposedore storage pad at both the Topaz and Sunday Mine and an 60ft by 60ft at both theWest Sunday and StJude Mine On site soils do not meet the minimum requirementsof plasticity plasticity index of 10 percent for use as soil liner material AccordinglyDenison will use a polyvinyl chloride PVC geomembrane liner for ore padconstruction The pad layout is shown in Figures 22 through 25 Soil from thefootprint of each ore storage pad will be used to construct a berm along the perimeterof the pad The berm will be constructed to contain surface water runoff from the padarea and prevent surface water runon The geomembrane liner will be installedconsistent with the manufacturersspecifications and an anchor trench will beconstructed to secure the liner Bedding and cover material typically with grain sizeno larger than 38inch in diameter will be used to prevent puncture damage to themembrane from the use of heavy equipment on the pad

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Additional design information including detail drawings and specifications for theinstallation of the PVC geomembrane ore pad liner systems at the Sunday MinesGroup is provided in Attachment S

612 Evaluation of the Proposed Environmental Protection FacilitiesThe proposed EPFs will incorporate necessary control systems ie berms andgeomembrane liner to contain surface water runoff for the 100year 24hour stormevent Stormwater runon will be diverted around the ore storage pad areas by theperimeter berms

The EPFs will be inspected and maintained as described in Section 5 and 6 of theSWMP included as Attachment F All necessary protective measures will be kept ineffective operating condition Any EPFs that are not adequately maintained inaccordance with good engineering hydrologic and pollution control practices areconsidered to be no longer operating effectively and will be modified or replaced

As outlined in the SWMP if a spill of pollutants threatens stormwater at the site thespill response procedures outlined below will be implemented in a timely manner

The Mine General Superintendent will be notified immediately when a spillor the threat of a spill is observed The superintendent will assess the situationand determine the appropriate response

If spills represent an imminent threat of escaping erosion and sediment controlfacilities and entering the receiving waters facility personnel will respondimmediately to contain the release and notify the superintendent after thesituation has been stabilized

The Mine General Superintendent or hisher designee will be responsible forcompleting the spill reporting form and for reporting the spill to theappropriate state or local agency

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70 Groundwater Information

The local hydrogeologic framework is relatively complex as a result of structuraldisplacements associated with the Gypsum Valley anticline the DisappointmentValley syncline and associated faulting and folding The Mesozoic aquifer and thelower portion of the Tertiary to Upper Cretaceous aquifer are present in the generalvicinity of the Sunday Mines Group The following sections provide additional detailregarding the local hydrogeologic framework The groundwater investigationGroundwater Characterization Data Collection Work Plan to Address Designated MiningOperations DMO Status Sunday Mines Group CDM 2008e is presented inAttachment N Additional information regarding regional and geology is discussedin the Hydrogeological Evaluation of Sunday Mines Group included as Attachment O

71 Local Geologic FrameworkThis section focuses on aspects of the local geologic framework that are pertinent tounderstanding the hydrogeologic framework of the mine areas This discussionincludes descriptions of rock units underlying affected areas of the mines and thelocation of faults that could influence movement of water in the subsurface Details

regarding the hydrogeologic framework of the areas are included in a subsequentsection of this document Section 72

The geologic framework in the affected areas of the Sunday Group mines is depictedon the geologic map included as Figure 71 and on geologic cross sections included asfigures 72 through 75

711 Sunday and Carnation Mines

The affected area of the Sunday and Carnation Mines are shown on Figure 72 Theaffected area of the mine lies on the Brushy Basin Member of the Morrison Formationwhich is composed primarily of bentonitic shale Several faults are present in the minearea One of the faults is present near the northern edge of the affected area whichdisplaces Brushy Basin Member downward towards Big Gypsum Valley A markedvariation in the orientation of the rock units is apparent between the fault blocks withsteep northerly dipping rock units present in the eastern portion of the section Thisstructural orientation exhibits the collapse of clastic sedimentary units into the centralportion of Big Gypsum Valley

712 St Jude Mine

The local geology in the area of the St Jude mine affected area is shown in Figure 73The affected area of the mine also overlies the Brushy Basin Member of the MorrisonFormation Three faults are present on the section with downward displacement ofrocks towards Big Gypsum Valley These faults form several fault bound blocks ofsedimentary rocks in the general vicinity of the mine affected area Folding faultingand collapse of rock units into the central portion of the valley is evident which isalso associated with collapse of clastic sedimentary rocks into the central portion ofBig Gypsum Valley

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713 West Sunday Mine

The local geological framework of the West Sunday Mine affected area is shown onFigure 74 In general this geology of the area is similar to that previously describedat the St Jude Carnation and Sunday mines However the affected area of the mineis located in a different location in relation to the faults bounding the valley and thedisplaced geologic formations The affected area of the West Sunday mine lies on theBrushy Basin Member of the Morrison Formation and the Burro Canyon FormationSeveral faults are present in the general vicinity of the mine affected area howeverthe faults are located upslope from the affected area

714 Topaz MineThe Topaz Mine is located approximately 1 mile west of the other Sunday Groupmines and the local geological framework is somewhat different The affected area ofthe Topaz mine is shown on Figure 75 This affected area directly overlies the SaltWash Member of the Morrison Formation which is the unit that hosts uraniumvanadium mineralization at the mine The Salt Wash Member consists of sandstone

with interbedded red shale and a few local beds of limestone A fault is present inproximity to the Topaz Mine affected area which displaces rock units on the northside downward as observed previously at the other Sunday Group mines This faultjuxtaposes the Brushy Basin shale on the north side of the fault against the Salt Washmember on the south side of the fault

Additional information regarding the geological framework in the area of the Topazmine affected area is shown on the geologic map Figure 71 The relative density offaults in the area west of the Topaz Mine is higher than areas adjacent to the otherSunday Group mines This may be related to increased structural complexityassociated with the intersection of the Big Gypsum Valley anticline with geologicstructures associated with the Dolores River Although the density of faults is higherthe faults show the same general pattern of displacing rock units on the north side ofthe fault downward towards Big Gypsum Valley The surface geology shown inFigure 21 also shows that the Salt Wash Member of the Morrison Formation cropsout west northwest of the Topaz mine adjacent to the Dolores River

72 Potential Aquifers in Area of Sunday Mines GroupIn order to better define the local hydrogeologic framework the hydrogeologic unitsdefined by Weir et al have been subdivided These subdivisions are summarized inExhibit 71

It is likely that groundwater flows laterally within the sandstone aquifers in adirection that is generally towards the Dolores River However local flow directionsin direct vicinity of the mines are likely modified by the complex structural geology ofarea and groundwater in the vicinity of the mines may take a complex route in theprocess of moving generally towards the Dolores River A hydrogeologic divide isinterpreted to be present coincident with the topographic divide between BigGypsum and Disappointment Valleys with groundwater north of the divide staying

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Groundwater Information

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Groundwater Information

within the Big Gypsum Creek watershed and groundwater south of the dividestaying within the Disappointment Creek watershed

The Salt Wash aquifer and the Dakota Aquifer crop out adjacent to the Dolores Riverin the Disappointment Creek watershed and the Salt Wash aquifer crops out adjacentto the river in the Big Gypsum Creek watershed These are likely areas ofgroundwater discharge to the river Groundwater discharge from the Dakota aquiferis also reported from several artesian wells in the Disappointment Creek watershedWeir et al 1983

Groundwater in the vicinity of the mine affected areas is generally unconfinedConfined conditions are reported for aquifers in Disappointment Valley and it islikely that groundwater conditions change from unconfined to confined as the depthof the aquifers increase along the northern limb of the Disappointment Valleysyncline

The following sections provide additional detail regarding the local groundwaterframework in direct vicinity of the various mines within the Sunday Group Theinterpreted depth to groundwater is based on observations of groundwater occurringwithin the Sunday West Sunday and Topaz mine at a depth of approximately 585 feetft and an assumption that the Dolores River is the local base point for thehydrogeologic system

721 Sunday and Carnation MinesAn interpretive hydrogeologic framework for the Sunday and Carnation mines ispresented in Figure 76 This section shows the approximate location of the affectedarea of the mines the underground workings the major hydrogeologic units majorfaults and the interpreted potentiometric surface

The affected area of the mines lies above the shale confining layer of the Brushy BasinMember of the Morrison Formation The potential for significant infiltration throughthis layer and recharge to groundwater is low in this area Groundwater is interpretedto be present within the Salt Wash and Navajo aquifers at depth beneath the confininglayers of the Brushy Basin Member Recharge to these aquifers is likely by lateral flowthrough the aquifer from adjacent areas where the sandstones are exposed at thesurface

An area of submerged mine workings is shown on the south end of the section southof the interpreted groundwater divide between Disappointment Valley to the Southand Big Gypsum Valley to the north This portion of the mine was excavated during aprior phase of mine development and these workings are currently inaccessibleGroundwater in this area likely flows towards the south into Disappointment ValleyCommunication of groundwater between the Salt Wash aquifer and the underlyingNavajo aquifer is unlikely because of the presence of the confining layer formed bythe Summerville Formation shale

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Groundwater Information

722 St Jude Mine

An interpretive section of the St Jude mine is shown in Figure 77 The affected areaof the St Jude mine is also located on shale of the Brushy Basin Member of theMorrison Formation which would restrict potential recharge to groundwater in thisarea Along the trace of the cross section significant direct recharge to groundwater isunlikely in the central and southern portions of the section however recharge mayoccur to the Dakota Aquifer in the Big Gypsum Valley area north of the mine affectedarea

Extensive faulting is present in the St Jude mine area which may lead to localcompartmentalization of groundwater The interpretive potentiometric surface in thisarea assumes that the water table has equilibrated over geologic time Although thepotentiometric surface may have equilibrated over geologic time it is likely that theconfining units restrict groundwater flow between aquifers unless the aquifers aredirectly adjacent as a result of fault displacements

723 West Sunday MineAn interpretive hydrogeologic cross section showing the West Sunday mine isincluded as Figure 78 The West Sunday Mine affected area is located east of theseries of faults on the periphery of the Gypsum Valley anticline and the developmentrock storage area overlies the Burro Canyon Formation Where saturated the BurroCanyon Formation is part of the Dakota aquifer and there is potential forgroundwater recharge to the Dakota aquifer from the mine affected area The SaltWash and Navajo aquifers are overlain by the Brushy Basin Member shale andtherefore significant recharge from the mine affected area to those aquifers is unlikely

The cross section shows the West Sunday mine decline extending to the southtowards Disappointment Valley Groundwater is present in the base of the WestSunday mine which is south of the groundwater divide between DisappointmentValley to the South and Big Gypsum Valley to the north Therefore groundwater inthe underground mining area would be expected to flow southward intoDisappointment Valley

724 Topaz Mine

An interpretive hydrogeological cross section showing the Topaz Mine affected areais included as Figure 79 The Topaz Mine affected area overlies the Salt WashMember of the Morrison Formation Based on the interpretive hydrogeologicalframework this portion of the Salt Wash Member may be saturated and therefore theSalt Wash aquifer could be present in this area The Salt Wash Member in this area istruncated to the north by the Brushy Basin Member of the Morrison Formation whichis a confining layer of low permeability shale There is potential for infiltration fromthe mine affected area to recharge the Salt Wash aquifer Flow of this water towardsthe north into Big Gypsum Valley would be unlikely based on the fault contactjuxtaposing the Salt Wash Member against the Brushy Basin Member However thepotential for westerly flow towards the Dolores River is plausible considering thesurficial geology

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Groundwater Information

The Topaz mine decline is also shown on the section The decline extends toward thesouth to access mining areas located south of the groundwater divide betweenDisappointment Valley to the south and Big Gypsum Valley to the north Thisorientation is similar to that observed at other Sunday Mines Group wheregroundwater flow from areas of underground mining is interpreted to be south intoDisappointment Valley

73 Potentially Water Bearing Fracture ZonesPotentially water bearing fracture zones range in size from very smallscale featuresthat primarily influence only the permeability of the rock to largescale features thatextend for miles and could potentially influence groundwaterflow paths This sectionfocuses on identifying large scale fracture zones associated with the faults mapped byCater 1955 because these features have a potential to influence groundwater flow ata larger scale

The effect of major fracture zones on groundwater flow is dependent on therheological characteristics of the displaced rock units Fault zones within relativelybrittle rocks such as massive sandstone are more likely to include zones of closelyspaced and interconnected fractures forming a fracture zone The fracture zones mayhave a marked influence of hydrogeologic characteristics Fault zones within shaleunits such as the bentoniterich Brushy Basin Member are less likely to influencegroundwater because the shale deforms plastically reducing permeability of the faultzone as compared to the more brittle units Weir et al 1983

The interpretive hydrogeologic framework cross sections presented previouslyFigures 76 to 79 provide information regarding the relative permeability of thefault zones A hatched pattern identifies portions of faults where two shale units arejuxtaposed on either side of the fault These are areas where the fault is less likely tohave a major effect on groundwater flow Fault zones that are not hatched identifyareas where significant fracture zones are more likely to be associated with the faultThese are areas where the fault zone would be more likely to affect groundwater flow

74 Direction and Rate of Groundwater Flow

741 Area of Underground WorkingsAlthough the regional direction of groundwater flow is towards the Dolores Riverthe direction and rate of groundwater flow in the area of the Sunday Mines Group isperturbed by the presence of the underground mine workings and integral activitiesassociated with mining such as dewatering and ventilation Available data regardingthe rate and direction of groundwater flow in the interconnected SundayCarnationSt JudeWest Sunday mine workings the Topaz Mine underground workingssuggests the following

The direction of groundwater flow in the vicinity of the West Sunday Mineunderground workings is into the mine

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Groundwater Information

The direction of groundwater flow in the area of the Sunday mineunderground workings has been into the mine during periods of activedewatering prior to 1991 and during recovery of the water table since 1991 itis unknown if groundwater is still flowing into the Sunday mine and

The direction of groundwater flow in the areas of the Topaz Carnation andSt Jude mines is currently unknown

Mine water pumped from the underground mines is not pumped to the surface anddischarged All of this water is used within the mines for dust control and drillingpurposes It is currently thought that this water evaporates and is exhausted from themine in the ventilation circuit This process can result in removal of large quantities ofwater from underground mines Younger et al 2002 This process causes theunderground mines to act as a local groundwater sink which causes localperturbations in the regional groundwater gradient Mine dewatering ceased in June2008 the mines are currently in temporary cessation status

The most recent phase of mine dewatering at the West Sunday Mine started in early2008 The rate of dewatering is estimated to be 400 gallons per day approximately 03gallons per minute S Davies West Sunday Mine Foreman personnelcommunication 2008 Prior to the most recent phase of mine dewatering the waterlevel in the West Sunday mine was approximately54381ft above mean sea levelamsl Dewatering at a rate of approximately 03 gallons per minute for a periodextending from early 2008 to the present has resulted in lowering of the water table byapproximately 14 feet to the current level of approximately54242ft amsl

Water within the Sunday Mine has not been pumped since approximately 1991 JFisher personal communication 2009 During the period of 1991 to the present thevolume of water that has flowed into the mine is approximately 554 million gallonsThis equates to an average inflow rate of approximately 58 gallons per minute overthe past 18 years The rate of inflow into an underground mine after cessation ofpumping is fastest immediately after pumping stops and slows as the mine watertable approaches the elevation of the surrounding water table Wolkersdorfer 2006 Itis currently unknown if groundwater is continuing to flow into the Sunday mineAlthough water has not been pumped from the Sunday mine since 1991 it is likelythat evaporative losses of water from the Sunday mine have continued to occurduring intermittent periods of active mining and associated ventilation during theperiod of 1991 to the present

A small zone of groundwater inflow is also present in the lower portion of theCarnation Mine and water is not reported in the St Jude mine Groundwater isreported to be flowing into the Carnation mine in this area but the rate of inflow iscurrently unknown

Observed groundwater elevations in the base of the Topaz mine are approximately140 feet higher than groundwater elevations in the area of the interconnected WestSundaySt Jude CarnationSunday underground workings The Topaz mine is not

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interconnected with the West SundaySt JudeCarnationSunday undergroundworkings Dewatering and ventilation of the Topaz mine has occurred on anintermittent basis since development of the mine It is currently unknown ifgroundwater in the area of the Topaz mine is contiguous with groundwater in thearea of the interconnected West SundaySt JudeCarnationSunday undergroundworkings It is possible that the 140 ft difference in the water table is a result ofdewatering and consumptive groundwater use resulting from mining in theinterconnected West SundayCarnationSt Jude Sunday mine workings It is alsopossible that the water observed in the Topaz mine is associated with a local perchedzone of groundwater within the Salt Wash Member

742 Surface Affected Areas

This section addresses the direction and rate of groundwater flow in the vicinity ofthe affected areas of the Sunday Mines Group In these areas the rate of groundwaterflow cannot be estimated empirically and therefore this section presents estimatesbased on analytical evaluations of available data The rate of groundwater flow isdiscussed here in terms of the average linear groundwater velocity The averagelinear groundwater velocity is a function of the hydraulic gradient the effectiveporosity and the hydraulic conductivity Dominico and Schwartz 1980 Datapresented in Exhibit 72 for estimated hydraulic conductivity is based on the intrinsicpermeability analyses of Jobim 1962 This section presents estimates of the rate ofgroundwater flow using the estimates of Jobim 1962 estimates of hydraulic gradientbased on relative observed water elevations in exploration drill holes and the DoloresRiver and values for effective porosity that are estimated using empiricalrelationships described by Chilinger 1963

Groundwater generally flows westerly from the areas of surface disturbance towardsthe Dolores River Therefore the gradient can be estimated by comparing theelevation of groundwater observed in exploration drill holes at the Carnation Sundayand Topaz Mines with the elevation of the Dolores River at potential groundwaterdischarge points in Big Gypsum Valley Exhibit 72 shows the observed groundwaterelevations at the CarnationSunday Mine and Topaz Mine affected areas and thepotential discharge point at the Dolores River the distance from the mines to thepotential discharge points and the estimated hydraulic gradients The distance usedin this estimate is the direct line of site distance between the mine affected areas and

the Salt Wash Member outcrops along the Dolores River in Big Gypsum Valley Thisprovides a conservative estimate of the hydraulic gradient because the actualgroundwater flow paths are likely longer than assumed In addition groundwatermay be compartmentalized within relatively isolated fault blocks in some areaswhich would affect the actual groundwater flow rate

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Mine Estimated

HydraulicGradient

Estimated

PorosityEstimated

HydraulicConductivitycmsec

Estimated

Average LinearGroundwater

Velocityfeetyear

Topaz 0004 011 11 x 104 41

Topaz 0004 014 11 x 104 33

West Sunday 0006 011 11 x 104 62

West Sunday 0006 014 11 x 104 49

Mine Observed

Groundwater

Elevation

feet

Elevation of

Potential

Discharge Pointfeet

Distance from

Mine to Potential

Discharge Pointfeet

Estimated

HydraulicGradient

feetCarnationWest

Sunday5490 5360 20431 0006

Topaz 5403 5360 10582 0004

Exhibit 72 Estimated Hydraulic Gradient

Section 7

Groundwater Information

The porosity of the sandstone is unknown however Freeze and Cherry 1979describe an empirical relationship developed by Chilinger 1963 which allowsestimation of sandstone porosity based on the textural classification and the intrinsicpermeability Craig et al 1955 describe the texture of Salt Wash Member sandstoneas ranging from fine grained to medium grained which is supported by visualobservations collected during the course of this investigation Based on the empiricalrelationship developed by Chilinger 1963 and the intrinsic permeability dataprovided by Jobim 1962 the porosity of the Salt Wash member sandstones isestimated to range from approximately 11 to 14 percent In this estimation of averagelinear groundwater velocity this estimated porosity is assumed to be equivalent tothe estimated effective porosity of the Salt Wash member sandstones

Groundwater observed in the West Sunday and Topaz Mines occurs within the SaltWash member of the Morrison Formation A hydraulic conductivity of 11 x 10centimeters per second cmsec is estimated for this unit based on intrinsicpermeability values provided by Jobim 1962

Exhibit 73 presents a range of estimated linear groundwater velocity for the SaltWash Member of the Morrison Formation in the vicinity of the mines based on thehydraulic conductivity effective porosity and hydraulic gradient informationdescribed above

Exhibit 73 Estimated Linear Groundwater Velocit

Based on the evaluation presented above the rate of groundwater flow is estimatedto range from approximately 33 to 62 feet per year This suggests that if pathwaysare present for groundwater to travel towards the Dolores River the travel time forgroundwater in the vicinity of the mine affected areas to reach the Dolores River maybe on the order of 2600 to 3300 years However the complex structural displacementof the Salt Wash aquifer and other hydrogeologic units likely increases the complexityof groundwater pathways which may affect the travel time towards the DoloresRiver

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Groundwater Quality

80 Groundwater Quality81 Regional Groundwater QualityGroundwater quality data for hydrogeological units within the Alluvial Dakota SaltWash and Navajo aquifers is summarized in Table 84 based on regional dataprovided by Weir et al 1983 Water quality characteristics vary between thehydrogeological units General groundwater quality characteristics include thefollowing

Groundwater from alluvial aquifers has moderate to high concentrations oftotal dissolved solids TDS chloride and sulfate with neutral pH

Groundwater from the Dakota aquifer has high concentrations of TDSchloride and sulfate with neutral pH

Groundwater from the Salt Wash aquifer has moderate concentrations of TDSchloride and sulfate with neutral pH and

Groundwater from the Navajo Aquifer varies with depth and hydrogeologicalunit Groundwater from depths of less than 500 ft has moderate to highconcentrations of TDS chloride and sulfate with moderate to slightly alkalinepH Groundwater from depths of greater than 500 ft has very highconcentrations of TDS sulfate and chloride and slightly alkaline pH

82 Local Groundwater QualityThe Sunday Mines Group is located in the Uravan mineral belt an area hosting one ofthe strongest natural concentrations of uranium and vanadium in the United StatesThe ore deposits that are mined at the Sunday Mines Group are some of the highestgrade rocks in the Uravan mineral belt Other naturally occurring elements such asarsenic molybdenum and selenium are also elevated in these areas

These ore deposits are located within the upper portion of the Salt Wash Member ofthe Morrison Formation which in some places is saturated with groundwater Theestimated flow rate of groundwater within these units is relatively slow 3362 feetper year and therefore groundwater flow through these naturally metalliferouszones takes thousands of years Therefore it is likely that groundwater hasequilibrated with the naturally enriched rock which contains elevated concentrationsof uranium vanadium and other naturally occurring elements Therefore anomalousconcentrations of these elements in groundwater are expected Mining processes suchas tunneling excavating rock and ventilating the underground workings may alsoaffect the concentration of metals in groundwater These activities are inherent partsof the mining process and although they have the potential to affect equilibriumconditions in close vicinity to the underground workings these affects areunavoidable

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Groundwater Quality

Investigation of Groundwater Quality Near the Underground WorkingsGroundwater quality near the underground workings was monitored to evaluate theambient groundwater quality The investigation also attempted to evaluate thepersistence of any miningrelated effects to groundwater downgradient from theunderground mine workings However this information was not obtained in theinvestigation as a result of the proximity of the underground monitoring wells inrelation to the mine dewatering system

Groundwater quality standards in Colorado are set forth by the Colorado Departmentof Public Health and Environment CDPHE Regulation 41 The Basic Standards forGround Water BSGW 5 CCR 100241 Regulatory jurisdiction for implementationof the BSGW at active metal mines in Colorado is delegated to DRMS as set forth byMemorandum ofAgreement For the Implementation of SB181 Amendments to the ColoradoWater Quality Control Act Pertaining to the Regulation ofMetal Mines CDPHE 2010 TheBSGW define ambient groundwater quality as the quality that was present on January31 1994 The BSGW also provide the following

In applying this interim narrative standard the Commission intends thatagencies with authority to implement this standard will exercise their bestprofessional judgment as to what constitutes adequate information todetermine or estimate existing ambient qualityData generated subsequentto January 31 1994 shall be presumed to be representative of existingquality as ofJanuary 31 1994 if there have been no new or increased sourcesofgroundwater contamination initiated in the area in question subsequent tothat date415C6biii

Ambient groundwater quality is defined similarly in HRMMR115

Ambient Groundwater Quality for mining operations permitted prior toJanuary 31 1994 Ambient Groundwater quality shall mean the quality of thegroundwater at the mine site as of 1994 For mining operations permitted onor after January 31 1994 ambient groundwater shall mean the quality ofgroundwater at the time of submittal of the permit operation In establishingambient groundwater quality an Operator or Applicant shall use available orcollected groundwater data sufficient to characterize the sites ambientgroundwater quality and submit such information in a form suitable to theOffice

The Sunday Mines Group has been in existence since the mid 1950s and the vastmajority of underground mine development occurred prior to 1994 Although someadditional mining has been done at the Sunday Mines Group since 1994 neither thetype of mining activities conducted nor the geochemical characteristics of the ore anddevelopment rock has changed appreciably It is unlikely that current groundwaterquality is significantly different than conditions on January 31 1994 Therefore thegroundwater quality measured in this investigation is thought to best representambient conditions at the Sunday Mines Group

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Monitoring well installation within the West Sunday Mine was initially scheduled forSeptember 2008 but was delayed because of the need for additional minedevelopment activities which improved the ventilation system to address radonconcentrations in air within the area of planned well installation Denison worked toimprove ventilation in this area of the underground workings to address this issueFollowing successful radon gas mitigation four monitoring wells were installed in theWest Sunday underground workings during the week of December 15 2008

Section 8

Groundwater Quality

These monitoring wells were installed in sub horizontal underground boreholes Theboreholes were drilled using an underground drilling rig and were installed at anangle of minus 20 degrees from horizontal Figure 81 shows the location of theunderground well nest in the West Sunday Mine The wells were installed to facilitatecollection of groundwater from a discrete interval in each bore hole A packerassembly inflated with nitrogen gas is located at the top of the screened interval tofacilitate sampling groundwater from the aquifer at the specified interval One wellwas installed north of the underground workings with a screened interval extendingfrom 43 to 63 ft Three wells were installed south of the underground workings withscreened intervals of 13 to 23 ft 18 to 28 ft and 33 to 43 ft respectively Dedicatedtubing was installed in the wells to facilitate sampling with a peristaltic pump

Minor field modifications of initial designs were necessary to facilitate wellinstallation The primary modifications included the following

Reduced Well Completion Depths A reduction in the well completion depthswas necessary because of repeated borehole collapse during installation Thetendency for the borehole to collapse was a result of the borehole orientationbeing close to the dip of the rock units and the corresponding bedding planediscontinuities

Installation of Well Heads above the Water Table Well heads were installed

at an elevation that is several feet above the groundwater table because ofaccess restrictions within the underground workings Although the well headsare located in an unsaturated portion of the mine using the 20 degreeinstallation technique the well screens for wells WS2 WS3and WS4 werecompleted in saturated portions of the subsurface It appears that the screenedinterval for well WS1 is only partially saturated which adversely affectedperformance of the well

Installation of One Well North of Underground Workings The hydrogeologicwork plan identified two wells to be installed to assess water qualityconditions north of the underground workings However during wellinstallation activities the second well could not be installed because that

portion of the mine is nolonger saturated as a result of ongoing minedewatering activities

Groundwater samples were initially scheduled to be collected immediately followingpurging of the newly installed wells in the underground workings eg December

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2008 However the recharge rate of the newly installed wells was relatively lowwhich resulted in a short delay in the scheduled sampling The low recharge rate isindicative of relatively low permeability of the aquifer During the week of December22 2008 Denison was scheduling to reenter the underground workings to purge thewells and collect groundwater samples At that time concentrations of radon gas inair exceeding permissible levels were again present in the underground workings andsampling activities could not be completed Again during the week of January 52009 groundwater sampling activities were planned but were delayed due to highconcentrations of radon gas in the subsurface Following modifications to the mineventilation system Denison successfully completed well purging and samplingactivities during the week of February 23 2009 A second round of samples wascollected during the week of March 17 2009

The groundwater quality data show that the ambient groundwater is relatively salinewith TDS content ranging from1300 to6990 mgL The ambient groundwater alsocontains uranium and vanadium which are the primary ore metals in the mine andseveral other elements that are naturally elevated in rocks at the Sunday Mines Groupincluding arsenic molybdenum and selenium The presence of these elements ingroundwater in close proximity to the underground workings is thought to be relatedto naturally occurring concentrations of metals and development of equilibriumconditions between the ore minerals and the local groundwater As discussedpreviously underground mine development activities such as tunneling excavatingrock and ventilating the underground workings may also affect the concentration ofthe naturally elevated elements in ambient groundwater The extent of effects togroundwater quality attributable to naturally occurring geochemical conditionsversus anthropogenic effects related to underground mine development is unknown

The location and orientation of the monitoring wells were initially designed to alsoevaluate the persistence of any miningrelated effects to groundwater quality in thedown gradient direction This was based on an interpretation that the hydraulicgradient in the area was coincident with topography ie a generally southwardgradient However a mine dewatering pump was located approximately 200 feetwest of the well nest within the lower portion of the West Sunday mine workingsTherefore it is unlikely that any of the wells measured direct effects of theunderground workings because a local cone of depression is likely present with aninward gradient surrounding the dewatered mine workings Therefore the directionof groundwater flow in this area is into the underground workings on both the northside where monitoring well WS4 is located and the south side of the workings wheremonitoring wells WS1 WS2 and WS3are located

The groundwater quality data show a marked difference in samples from monitoringwell WS4 as compared to WS1 WS2 and WS3 The locations of the undergroundmonitoring wells are shown in Figure 81 The collars of the wells are located veryclose to the base of the Top Rim sandstone and the rock units dip gently towards thesouth The collar location and the downward angle of monitoring well WS4causesthe screened interval to be located in an intermediate siltstone and shale unit of the

Salt Wash member rather than the Top Rim Sandstone The screened interval of

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monitoring wells located on the south side of the underground mine workings arelocated in the Top Rim Sandstone which hosts the uranium vanadium ore as well aselevated concentrations of associated natural occurring elements such as arsenicmolybdenum and selenium

Groundwater quality data shown in Table 82 display a marked difference betweenwells screened in the Top Rim Sandstone WS1 WS2 and WS3 and the wellscreened in the underlying intermediate siltstones and shales WS4 Water qualityfrom WS4 is saline with TDS of6990 mgL and contains high concentrations ofchloride sodium and sulfate This water also contains relatively lower concentrationsof the ore metals uranium and vanadium and associated elements such as arsenic

molybdenum and selenium The wells screened in the Top Rim sandstone showrelatively higher concentrations of the ore metals and associated elements This wateris also relatively saline with TDS ranging from1300 to 1710 mgL but the watercontains much lower concentrations of sodium chloride and sulfate This markedcontrast in uranium and vanadium concentrations in groundwater within theunderlying intermediate siltstones and shale indicates that potential anthropogeniceffects to groundwater in direct proximity to the underground workings has notaffected groundwater located only 63 feet from the underground workings

The groundwater data collected to date supports the hydrogeological framework forthe area developed by Weir et al 1983 which describes groundwater flow movinglaterally within the sandstone unit Vertical flow is restricted by interbedded lowpermeability units such as the intermediate siltstones and shales of the Salt WashMember which limits potential vertical migration of groundwater The groundwaterquality data described above show a marked difference in groundwater qualitybetween the units Groundwater quality in the Top Rim Sandstone displays asignature associated with the naturally elevated concentrations of uranium vanadiumand other elements that are present in the ore bodies Water quality from theunderlying unit displays a different chemistry with high salinity This suggests thatthe intermediate siltstones and shales of the Salt Wash Member may contain naturalenrichments of sodium chloride and sulfate

The groundwater quality data collected to date shows that groundwater locatedwithin approximately 40 feet of the underground workings shows a characteristicsignature associated with the naturally elevated concentrations of uranium vanadiumand other elements that comprise the ore bodies This signature does not extend evenlocally into the underlying intermediate siltstones and shales of the Salt Washmember The lateral extent of groundwater with this characteristic chemical signaturein the Top Rim Sandstone unit is currently unknown Additional monitoring wellswill be installed in accordance with this EPP as discussed later in Section 11 Water

Quality Monitoring Plan

83 Existing and Future Uses of GroundwaterExisting or potential future uses of groundwater within 2 miles of the Sunday MinesGroup are limited because the land is primarily public land administered by the BLM

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The only current groundwater use in the area is an industrial use to support DenisonMining operations which is permitted by a Colorado Well Permit

Groundwater use in conjunction with mining activities is limited to small quantities ofwater used for drilling and dust suppression purposes within the undergroundmines During previous mining activities approximately 400 gallons per day ofgroundwater was pumped from the base of the West Sunday Mine to several areaswithin the Sunday Mines Group Complex Stanley Davies West Sunday MineSuperintendant personal communication 2008 Although the available groundwatervolume is low approximately 03 gallons per minute it was sufficient to supplyneeds for the underground mining operations Mine dewatering activities ceased inJune 2009 since that time the mine has been in temporary cessation status

Although the rate of groundwater use in the West Sunday mine is relatively modestit has lowered the water table in the vicinity of the underground workings byapproximately 4060 feet based on available information This reduces the hydraulicgradient between the West Sunday Mine and the Dolores River and lowers thelikelihood that mine water is currently flowing from the underground workings intosurrounding groundwater

Groundwater use is also limited in a wider area surrounding the Sunday MinesGroup based on a search of the Colorado Division of Water and Natural Resourceswell permit database Several wells are currently permitted in an area near theDolores River southwest of the Sunday Mines Group These wells are listed in Exhibit81 along with aliquot part legal descriptions of the well locations and theapproximate distance of the wells from the Sunday Mines Group

The closest well to the Sunday Mines Group is a BLM stock well reported to be in theDakota aquifer The well is located south of the Sunday Mines Group in the centralportion of Disappointment Valley The Dakota aquifer is located stratigraphicallyabove the Salt Wash aquifer which contains the underground mine workings Thesetwo aquifers are separated by a confining layer composed of bentonic shale of theBrushy Basin member Therefore it is unlikely that water from the underground mineareas would communicate with the Dakota Aquifer in this area The developmentrock area of the West Sunday mine overlies the Dakota aquifer in the Big GypsumValley area on Figure 82 However the Dakota aquifer in the Big Gypsum Valleyarea is a fault bound block of Brushy Basin Formation and Dakota Sandstone whichis not contiguous with the Dakota Aquifer in Disappointment Valley The other wellsin the general area of the Sunday Mines Group are located at extensive distances iegreater than four miles andor are upgradient from the mine areas Informationregarding the depth of the wells is not available

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Well Location Permitted

Uses

Distance from

Sunday MinesGroup

Comments

SE t4 SW 14 Sec 25T44N R18W NMPM1

Stock 24 miles Well is potentially downgradient frommine workings However the well islocated in the Dakota aquifer whichoverlies Salt Wash Aquifer and isisolated from Sunday Group Mineworkings by Brushy Basin ConfiningUnit

NE to SW 4 Sec 25T44N R19W NMPM

IndustrialDomestic

Approximately 5miles

Located southwest of mine area

gradient to mine area unknownNE Y4 SE 14 Sec 31T44N R18W NMPM

DomesticStock

Approximately 4miles

Located southwest of mine area

gradient to mine area unknownNW 4NW Sec 33T45N R18W NMPM

Domestic Approximately 4miles

Located northeast of mine area

upgradient from mine areas

1 Wells Located in General Vicinity of Sunday Mines Grou

Notes I New Mexico Principal Meridian

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Potential future uses of groundwater in the area of the Sunday Mines Group arelimited by the land ownership and the BLM Management Plan for the area Theaffected areas of the Sunday Mines Group are included within Management Area 3MA 3 Natural Landscape with Limited Management Management activities for areaswith this designation are defined as follows BLM 2008

Management activities are allowed but limited on MA 3s They occur mostlyfor restoration purposes needed because ofnatural disturbance events or pastmanagement actions Management activities may include restoration ofecological conditions or habitat components prescribed burns wildland fireuse salvage logging followingfire insect epidemics andor wind eventshazardous fuels reduction and invasive species reduction Temporary roadconstruction and motorized equipment may be used in order to achieve desiredconditions however most roads would be closed upon project completionMost MA 3s emphasize non motorized recreation opportunities butmotorized travel occurs in some areas on existing roads and some trailsLivestock grazing occurs on many of these lands

As described in the BLM Management Plan designation BLM intends to manage thisarea with very limited disturbance Future development that would be expected iscontinued mining in the area of the Sunday Mines Group In addition oil and gasexploration andor additional uranium exploration may occur It is unlikely thateither the land ownership or the land uses in this area will change markedly in thefuture As a result groundwater uses are not expected to change markedly in theforeseeable future

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90 Surface Water

Neither perennial nor intermittent surface water bodies are present in the directvicinity of the Sunday Mines Group Surface water in the affected areas of the mines islimited to stormwater which is managed in accordance with an existing stormwaterdischarge permit This section provides general information regarding perennial andintermittent surface water in the vicinity of the Sunday Mines Group and detailedinformation regarding management of stormwater at the mines

91 Perennial and Intermittent Surface Water

The affected areas of the mines are located on the south side of Big Gypsum Valleyapproximately lh mile from an ephemeral drainage called Big Gypsum Creek whichdrains into the Dolores River several miles downstream of the affected areas Surface

water is generally not present at the Sunday Mines Group except during periods ofsnow melt or in response to episodic precipitation events Storm water retentionponds are present at the mines which are designed to retain all storm watergenerated by a 100 year precipitation event at the mines

The Dolores River is the major surface water feature in the area of the Sunday MinesGroup The river extends for 183 miles from an area northeast of Rico Colorado tothe Colorado River at the town of Cisco Colorado The Dolores River Basin is

approximately 96 miles long and 34 miles wide encompassing an area of6222 squaremiles Most of the flow in the river originates on the western slopes of the La Plataand Rico mountains with additional contributions from snowmelt and springs ofhigher mesas and mountains The Dolores River also receives inflows fromgroundwater which are estimated to be approximately 3 liters per second perkilometer in the portion of the river extending from the town of Dolores to CiscoWeir et al 1983

Big Gypsum Valley is located within the central portion of the Dolores River Basin inan area that is among the most arid portions of the basin based on analyses presentedby Weir et al 1983 An ephemeral drainage is present within Big Gypsum Valleyapproximately 1 mile north of the Sunday Mines Group Surface water was notobserved in this drainage during site visits in June August and December 2008 butthe geomorphology of the drainage suggests that ephemeral flows do occuroccasionally in response to snow melt or large precipitation events Intermittent flowsmay also be present in the lower portion of the drainage

92 Design Specifications for Stormwater ManagementFacilities

A stormwater drainage report for Topaz Mine was developed by Tetra Tech EM Incin 2007 Tetra Tech 2007 CDM reviewed the Tetra Tech drainage report andprovided recommendations to improve the Topaz Mine drainage facilities designs

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Section 9

Surface Water

CDM also addressed comments provided by the BLM on the Tetra Tech drainagereport For the other mine areas egSunday West Sunday St Jude and CarnationMines the following procedure was used to design the drainage facilitiescomponents

The peak discharge was estimated for a selected storm return interval usingdrainage basin and climatic characteristics

Drainage channels berms and catchment basins were designed to convey orcontain water for the selected return interval based on available AutoCAD

data

Channel bank and bed protection was designed for the estimated flowcondition

Document review drainage facility design and recommendations for the TopazMine in addition to the designs of storm water collection conveyance and detentionfacilities components for the West Sunday St Jude Carnation and Sunday Mines areprovided in the Drainage Report for Denison Mines Sunday Mines Group San MiguelCounty Colorado This report is included as Attachment P

93 Stormwater Runoff Detention Basins

The surface facilities at the Sunday Mines Group sit on top of the development rockstockpiles Off site stormwater runoff from the Sunday Mines is routed around thesurface facilities so that no offsite runoff encounters the ore stockpiles ordevelopment rock Stormwater that falls directly onto the facilities is routed aroundthe facilities in a series of berms and detained in stormwater detention basins at the

base of each development rock pile In May 2008 a Colorado Board Registeredprofessional engineer visited the Sunday Mines and completed a stormwaterevaluation of the Mines to ensure that all water from a 100year 24hour storm wasdetained in the detention basins Because the Sunday Mines are existing facilitiesDenison surveyed each of the Mine Sites and followed up to ensure that the facilitiesare adequately sized In many cases the stormwater diversion structures anddetention basins are larger than the required size to detain the 100year 24hourstorm The drainage report calculations mapping and follow up memorandum areall provided in Attachment P and Q

94 Stormwater Management Plan Maintenance andInspection ProgramIn accordance with the CDPS General Permit Stormwater Discharges Associated withMetal Mining Industry the Sunday Mines Group has developed a stormwatermanagement plan that discuss Best Management Practices BMPs that were selectedinstalled implemented and maintained with good engineering practices A copy ofboth the CDPS general stormwater permit and the Stormwater Management PlanSWMP are included in Attachment F Specific permit requirements for the SundayMines Group is described in the SWMP

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100 Surface Water Quality DataAs mentioned in Section 9 surface water bodies are not present in the direct vicinityof the Sunday Mines Group

The affected areas of the mines are located on the south side of Big Gypsum Valleyapproximately 12 mile from an ephemeral drainage called Big Gypsum Creek whichdrains into the Dolores River several miles downstream of the affected areas Surface

water is generally not present at the Sunday Mines Group except during periods ofsnow melt or in response to episodic precipitation events In addition the SundayMines Group is located within an arid environment The retained water is generallynot discharged from the mine site because the water evaporates rapidly in the aridenvironment present within Big Gypsum Valley

According to the Denison Mines USA Corp Sunday Mines Environmental AssessmentCO800 2007104EA water quality protection is currently and would continue to beprovided through the engineered stormwater drainage facilities and implementationof the SWMP as required under the DenisonsCDPS stormwater discharge permitCOR040223 A copy of the environmental assessment can be available from BLM orprovided upon request

Based on the distances from the nearest surface water body the implementation ofstormwater BMPs and the high evaporative potential no surface water samples havebeen collected at the Sunday Mines Group

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110 Water Quality Monitoring Plan

Water quality monitoring requirements at the Sunday Mines Group currently includethe monitoring requirements set forth in the existing CDPS General StormwaterPermit Denison proposes to increase the existing water quality monitoring programto include groundwater monitoring in accordance with requirements of HRMMR andthe BSGW

111 Surface Water MonitoringThe existing surface water monitoring program is adequate and appropriate for theSunday Mines Group because perennial or intermittent surface water bodies are notpresent in the affected areas of the mines existing stormwater BMPs are present andDenison is in compliance with an existing CDPS General Stormwater Permit CDPHEhas primary jurisdiction to regulate compliance with the CDPS General StormwaterPermit Accordingly Denison proposes to continue maintaining compliance with theexisting CDPS General Stormwater Permit and to report the performance monitoringdata to CDPHE as specified in the existing permit If requested Denison will alsoprovide a copy of this information to DRMS

112 Groundwater MonitoringA groundwater quality monitoring program has not previously been in place at theSunday Mines Group Regulatory jurisdiction for groundwater at active metal minesin Colorado is delegated to DRMS This EPP establishes a groundwater monitoringprogram at the Sunday Mines Group in accordance with requirements of theHRMMR and BSGW As described below the groundwater monitoring program willutilize upgradient intermediate and compliance wells to monitor potential effects ofthe mining operation on groundwater quality Compliance limits will be establishedin two phases and will apply at the compliance wells

Denison will install six new monitoring wells to evaluate potential effects of themining operation on groundwater The locations for these wells were developed inconsultation with DRMS and the BLM and are shown on Figure 111 Five wells willbe installed to assess potential effects of underground mining on groundwater Thesewells will include an upgradient monitoring well two compliance wells located at thepermit boundary and two intermediate monitoring wells located between the currentmining areas and the compliance wells

In addition one well will be installed at the Topaz Mine DRA The purpose of thiswell is to assess potential leachate generation from DRAs at the Sunday Mines GroupThis issue has been previously assessed through site specific development rocksampling and unsaturated flow modeling which is discussed in Section 13 Workconducted to date indicates that it is unlikely that the DRAs generate significantleachate The proposed monitoring well at the Topaz DRA was developed inconsultation with the Bureau of Land Management BLM to further assess thepotential for leachate generation from DRAs at the Sunday Mines Group

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1121Monitoring Well Locations

The regional groundwater gradient is assumed to be towards the south based on thetopography of the area and available groundwater level data Therefore theupgradient monitoring wells will be located north of the underground mine workingsand the intermediate and compliance wells will be south of the underground mineworkings Monitoring wells will be screened in the Top Rim sandstone unit of theSaltwash aquifer This rock unit hosts the uranium ore bodies that have been and willbe mined at the Sunday Mines Group The following provides additional detailregarding the proposed groundwater monitoring wells

Upgradient Monitoring WellThe location for the upgradient groundwater monitoring well was determined inconsultation with DRMS based on evaluation of hydrogeology ore deposit geologyand the location of active and expected future mining areas Groundwater qualitydata collected from the upgradient well will be used to support assessment ofgroundwater conditions in the Top Rim sandstone of the Salt Wash aquifer Waterlevel data collected from the upgradient well will support further assessment ofgroundwater flow directions and velocity Criteria considered by DRMS and Denisonin selection of the upgradient monitoring well location included the following

The well should be located in an area of naturally elevated concentrations ofuranium and vanadium to provide a representative measurement of naturalbackground conditions in mineralized areas

The well should not be located in direct proximity of the undergroundworkings to avoid potential anthropogenic effects to groundwater quality

The well should be located within the Top Rim Sandstone Unit of the SaltwashMember the rock unit that hosts uranium mineralization and

The well should not be located down gradient from the mine workings

The structural geology of the area essentially truncates the aquifer of interest in thenortherly direction as shown on Figure 112 The Top Rim sandstone unit is present inthis area but it occurs at a higher elevation and is not saturated Rock unitsstratigraphically below the Top Rim sandstone may be saturated north of theproposed location but the target aquifer for groundwater quality monitoring is notsaturated Therefore the structural geology and hydrogeology of the area precludesplacement of the upgradient monitoring well further north from the selected location

The upgradient monitoring well will also be located within an area of naturallymineralized rock to provide valid data to assist with both the evaluation of ambientconditions and potential effects of the mining operation on groundwater quality Thislimitation precludes placement of the upgradient monitoring well further to the westof the selected location or in a location distal to areas of uranium and vanadium

mineralization Areas of previously mined underground workings are present east ofthe proposed location The location for the upgradient monitoring well was selected

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to avoid potential anthropogenic effects to groundwater quality which could becaused by blasting mine ventilation or other factors

Intermediate Monitoring WellsThe Sunday Mines Group may potentially affect groundwater quality in closeproximity to underground workings because oxidation caused by mine ventilationcould influence the solubility of uranium and other trace constituents Howeverbased on the data discussed in Section 8 any increase in oxidation of groundwaternear the underground mine workings is expected to be local in extent As thisgroundwater migrates away from the underground mine workings it is expected tobe reduced to background redox conditions through interaction with trace organicmatter present in the Top Rim sandstone Reduction of groundwater along the flowpath reduces the solubility of uranium and vanadium and results in precipitation ofthose elements into insoluble mineral forms This geochemical process of uraniumprecipitation caused by reduction of groundwater is a wellunderstood mechanismfor formation of uranium ore deposits Guilbert and Park 1986 These ore formingprocesses can be used as a natural analog to understand the fate of uranium andassociated naturally occurring elements such as arsenic molybdenum and seleniumin the groundwater system Langmuir 1999

Two intermediate monitoring wells recommended by DRMS will be installed asshown on Figure 111 These wells will evaluate water quality at an intermediatelocation between the existing mine workings and the compliance wells The purposeof these monitoring wells is to provide early indications of any potential groundwaterquality issues prior to effects at the compliance wells

The intermediate monitoring wells are located in areas expected to be mined duringthe life of the Sunday Mines Group mining is planned to progress from currentmining areas towards the south Therefore these wells will be abandoned whenactive mining approaches the monitoring well locations However these wells willprovide for additional environmental protection at the Sunday Mines Group duringthe period when they are operational and early warning of potential groundwaterissues prior to effects at the compliance wells The intermediate monitoring wells willnot themselves be compliance wells

Compliance WellsTwo groundwater compliance wells are proposed to be located south of the existingmine area at the mine permit boundary The permit boundary encompasses all areasthat are planned to be mined in the future The purpose of the compliance wells is tomeasure compliance of the mining operation with respect to applicable groundwaterquality standards

Topaz Mine DRA Monitoring WellOne monitoring well will be installed at the Topaz Mine DRA This well wasrequested by BLM to further assess the potential for leachate generation from theSunday Mines Group DRAs This well will be a shallow monitoring well installedwithin colluvial sediments located near the base of the Topaz Mine DRA

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Specifications for this well were stipulated by BLM to address issues related toenvironmental analysis of the Sunday Mines Group as required by the NationalEnvironmental Policy Act of 1969 NEPA This well is also proposed as a componentof this Environmental Protection Plan and monitoring data from the well will beprovided to both BLM and DRMS

1122Monitoring Well Installation and Aquifer TestingAll monitoring wells will be installed by qualified persons licensed in the state ofColorado A critical aspect of well installation is identification of the properstratigraphic location for the screened interval of the well The wells are planned to bescreened within the Top Rim sandstone of the Salt Wash Member of the MorrisonFormation at a depth of approximately 800 to 1000 feet Both lithological logging ofdrill cuttings and downhole geophysical methods will be used to identify the properstratigraphic location for the screened interval of the monitoring wells

Pumping tests will also be completed at each monitoring well to measure aquifercharacteristics including transmissivity and hydraulic conductivity These data willsupplement existing USGS data and better define the local groundwater system Thesite specific hydraulic conductivity data will be utilized along with water level data tobetter understand groundwater flow directions and velocity in the area of theunderground mine workings

1123Groundwater Sampling

Groundwater sampling will be conducted on a quarterly basis at each wellGroundwater sampling will be conducted throughout the life of the Sunday MinesGroup until reclamation liability is released by DRMS Groundwater sampling willinclude measuring the static water table with a well probe or other suitableinstrument purging the well in accordance with best practices measurement of fieldparameters including specific conductance pH and oxidation reduction potentialand collection of samples for laboratory analyses Laboratory analyses will beconducted on samples filtered to 045 microns and will include the following

All parameters listed in Table 1 through 4 of the BSGW for a period of oneyear with the exception of total coliforms asbestos free cyanide chlorophenolcolor corrositivity foaming agents odor and phenol and

Radium 226 and 228 which are designated in statewide standards set forth inBSGW415C2

Major cations and anions

Groundwater samples will be submitted for laboratory analyses and analyticalmethod reporting limits will be below criteria presented in Table 1 through 4 of theBSGW After completion of five quarters of monitoring the sampling frequencyandor analyte list may be reduced with DRMS approval The groundwatermonitoring data will be submitted within 30 days of receiving the laboratory datareports and an annual report would be provided to DRMS that compiles the

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groundwater quality data evaluates groundwater quality trends and once permitlimits are established compares the compliance well data to the permit limits

1124Evaluation of Groundwater Monitoring Data

Groundwater monitoring data collected in accordance with this EPP will be used fortwo primary purposes

With respect to the two compliance wells evaluation of compliance withpermit limits and

With respect to the other wells general monitoring of any effects of theunderground mine on groundwater quality

Groundwater Quality Permit LimitsGroundwater quality permit limits for the Sunday Mines Group are under thejurisdiction of DRMS as set forth by the BSGW and the stipulations of theMemorandum ofAgreement for the Implementation of SB181 Amendments to the ColoradoWater Quality Control Act Pertaining to the Regulation ofMetal Mines CDPHE 2010Permit limits established in accordance with this EPP are defined in two phases

Interim permit limits and

Final permit limits

The interim permit limits will be established after collection of five quarterlygroundwater samples and will be used until ambient groundwater quality isadequately characterized through collection of 8 to 10 quarterly samples Onceambient groundwater quality is adequately characterized the final permit limits willbe established

Regulatory ConsiderationsGroundwater at the Sunday Mines Group is unclassified and therefore the narrativestandard is applicable as set forth by BSGW415C6aThis standard requiresgroundwater to meet either the existing ambient quality as of January 31 1994 orthat quality which meets the most stringent criteria set forth in Tables 1 through 4 ofthe Basic Standards for Groundwater whichever is less stringent Although similarthe definitions of background water quality and ambient groundwater quality aredistinct within the regulatory framework established by the BSGW and the HRMMR

Background water quality is the quality of groundwater unaffected by theactivity BSGW4133and

Ambient water quality is the quality of groundwater on January 31 1994 formines permitted prior to January 31 1994 and the water quality at the time ofsubmittal of the permit application for mines permitted after January 31 1994HRMMR115

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All of the mines within the Sunday Mines Group were permitted prior to January 311994 Therefore the ambient groundwater quality is defined as the quality present onJanuary 31 1994 As discussed in Section 82 the BSGW clarify that data generatedsubsequent to January 31 1994 shall be presumed to be representative of existingquality as of January 31 1994 if there have been no new or increased sources ofgroundwater contamination initiated in the area in question Although a limitedamount of mining has occurred briefly on two occasions at the Sunday MinesComplex since January 31 1994 the mining activities were essentially the same asconducted prior to January 31 1994 although with little impact to areas below thewater table and the water quality measured in the underground well nest seeSection 8 is representative of ambient conditions in close proximity to theunderground workings

However the ambient groundwater quality at the underground well nest may not berepresentative of ambient groundwater quality at the compliance wells Spatialvariability in groundwater quality is expected to be significant based on the followingconsiderations

Groundwater is in geochemical equilibrium with the rocks hosting the aquiferand these rocks contain highly variable concentrations of uranium vanadiumand other trace metals and metalloids associated with the natural uranium and

vanadium concentrations Sedimentary rocks hosting the aquifer also containvariable concentrations of evaporate minerals such as gypsum and halitewhich lead to elevated TDS concentrations in groundwater These evaporatemineral concentrations vary laterally and vertically in relation to naturalstratigraphic facies changes

Groundwater moves very slowly estimated groundwater velocity is only 3362 feet per year which makes it likely that groundwater will equilibrate withthe rock along its flow path leading to variations in concentrations of uraniumvanadium and other trace constituents in groundwater

Activities inherent to the underground mining process such as mineventilation may lead to local changes in groundwater quality in closeproximity to the underground workings

As a result of this spatial variability in groundwater quality the ambient groundwaterquality measured in close proximity to the undergound mine may not berepresentative of the ambient groundwater quality at the intermediate andcompliance wells Further upgradient wells are not likely to be representative ofdowngradient conditions given the expected spatial variability of groundwaterquality

The hydrogeologic and geochemical conditions present at the Sunday Mines Groupare therefore wellsuited to use of an intrawell statistical approach based on EPAguidance for statistical analysis of groundwater monitoring data EPA 2009Important considerations in selecting an intrawell statistical approach include

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Spatial Variability If background concentrations are expected to changesubstantially from one well to the next due to naturalhydrogeologicgeochemical conditions an intrawell approach provides themost accurate baseline for use in statistical comparisons

Definable Hydraulic Gradient Where the groundwater flow is not in adefinable pathway from upgradient to downgradient wells an interwellapproach may not be valid and an intrawell approach is appropriate toconsider

Flow Velocity Interwell approaches egupgradient to downgradient wellcomparisons assume that groundwater flows at a sufficient velocitydowngradient from the site so that the same groundwater observed atupgradient well locations is subsequently monitored at downgradient wellsduring the course of an evaluation period eg six months to a year Ifgroundwater flow is much slower measurements from upgradient anddowngradient wells may be more akin to samples from two separate aquifersand an intrawell approach is appropriate

Based on the slow groundwater velocity the likely inward gradient of groundwatertowards the underground mine caused by historic mine activity and the negligiblerecharge rate it is unlikely that groundwater at the compliance wells has beenaffected by past mining activities Accordingly background and ambientgroundwater quality as defined by the BSGW and the HRMMR at the location of thecompliance wells are essentially the same because it is unlikely that groundwater atthe compliance wells has been affected by mining activities Further in the unlikelyevent that the compliance wells have been impacted by historic mine activities it iseven more unlikely given the slow rate of groundwater flow and the distance fromthe underground mine workings to the compliance well locations that any suchimpacts could be caused by mining activities after January 31 1994

Based on the site specific conditions permit limits applicable at the compliancemonitoring wells will therefore be based on intrawell statistical analysis of datacollected from the groundwater compliance wells The intrawell approach is notaffected by spatial variations in groundwater quality Permit limits based on theintrawell approach at the compliance monitoring wells will be the best indication ofbackground groundwater quality at these locations

Interim Permit Limits

Groundwater at the Sunday Mines Group is not classified Therefore the narrativestandard of BSGW415C6aapplies which requires that groundwater meeteither the existing ambient quality as of January 31 1994 or that quality which meetsthe most stringent criteria set forth in Tables 1 through 4 of the BSGW whichever isless stringent After five quarters of data have been collected from the compliancewells constituents that are present in the groundwater at concentrations lower thanthe most stringent criteria of Tables 1 through 4 of the BSGW will be identified Themost stringent criteria set forth in Tables 1 through 4 of the BSGW will be used todefine permit limits for those constituents Permit limits for constituents that occur at

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concentrations that exceed the table values will be calculated based on statistical

analysis of ambient groundwater quality at the compliance wells

Neither the BSGW nor the HRMMR define a statistical approach for calculation ofpermit limits based on ambient groundwater quality data A tolerance intervalapproach as recommend by EPA 2009 is planned to be used to define the interimpermit limits The tolerance interval is a concentration range designed to contain aspecified proportion of the underlying population from which the groundwaterquality samples are drawn The interim permit limits applicable at the compliancewells for these constituents will be calculated as follows

IPL x zn9595s

Where IPL is the interim permit limit x is the mean of the water quality samples fromeach compliance well T is the tolerance limit based on sample size with 95 percentconfidence that 95 percent of the underlying population is contained within thetolerance interval and s is the sample standard deviation Because this is an intrawellapproach different permit limits will be calculated for each compliance well Thesepermit limits will apply to the dissolved portion of the sample as defined by filtrationat 045 microns and will be applicable at the compliance wells until final permit limitsare established in accordance with this EPP The statistical analyses will be conductedby Denison in consultation with DRMS and will be provided to DRMS for review andapproval If actual results indicate that the foregoing statistical analysis would not beappropriate then a comparable statistical approach will be used consistent with EPAguidance EPA 2009 Although permit limits will not be set at the upgradient andintermediate wells the same statistical intrawell approach will be used to determinebaseline conditions at those wells

Final Permit Limits

Groundwater quality data collected from the compliance wells will be used todevelop final permit limits after sufficient samples have been collected to adequatelycharacterize backgroundambient water quality for each well on an intrawell basisThe BSGW do not specify the number of samples necessary to characterizebackground ambient groundwater quality EPA guidance recommends that at least810 independent samples be collected to adequately characterizebackground ambient groundwater quality EPA 2009 Based on the quarterlysampling frequency set forth in Section 1122additional statistical analysis ofbackground ambient groundwater quality data will be completed to establish finalpermit limits approximately 2 years after approval of this EPP and installation of themonitoring wells

Although more frequent sampling of the monitoring wells could theoreticallyexpedite this process it is critical that independent samples are collected to supportvalid statistical analysis EPA 2009 Given the relatively low hydraulic conductivityof the Salt Wash Member the slow estimated groundwater velocity of 33 to 62 feetper year and the negligible recharge rate to the Salt Wash aquifer caused by the

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overlying Brushy Basin shale of the Morrison Formation more frequent sampling ofbackground groundwater quality is not recommended

Final permit limits will be developed once 810 samples have been collected from themonitoring well network Intrawell statistical methods will be applied andor otherbest practices consistent with EPA guidance EPA 2009 Final permit limits applicableat the compliance wells will be developed on an intrawell basis based on thesestatistical evaluations This statistical analysis will be conducted by Denison inconsultation with DRMS and will be provided to DRMS in a report for review andapproval Although permit limits will not be applicable to the upgradient andintermediate wells statistical analysis based on 8 to 10 quarterly samples will also beperformed on those wells on an intrawell basis to determine baseline conditionsThese statistical analyses will also be presented in the final report

Assessment of Potential Mining Impacts Using Upgradient and Intermediate WellsAs discussed in Section 8 the ambient water quality in close proximity to theunderground workings shows elevated levels of uranium vanadium and otherelements that are naturally associated with the uranium and vanadiumconcentrations This is likely attributable to a combination of natural andanthropogenic factors The Statement of Basis for the BSGW addresses this issue asfollows

The Commission intends to allow forflexibility in locating the point or pointsof compliance within the specified area After the point or points of complianceare determined applicable ground water quality standards are to be met atthese locations Mining activities are recognized to occur within ground waterbodies and that water quality within the disturbed area will obviously changeThe pointsof compliance established outside the area anticipated to bedisturbed may protect the water body while allowing the mining activity

Accordingly the permit limits will not apply to monitoring wells located within themine permit boundary The upgradient and intermediate monitoring wells will beused to better understand spatial variability in groundwater quality to understandthe effect of the Sunday Mines Complex on groundwater quality over the life of themine and to facilitate evaluation of any additional environmental managementactivities that may be necessary to protect groundwater resources in the future

The intermediate wells will be located within areas planned to be mined in the futurewhich will require that the wells be abandoned prior to cessation of mining Datacollected from the intermediate monitoring wells will be assessed and summarized inthe annual groundwater monitoring report Similarly results from the Topazmonitoring well stipulated by BLM will be assessed and summarized in the annualgroundwater monitoring report

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120 Climate

The Sunday Mines Group is located within an arid environment Climatic conditionsin this area generally include moderate to cold winter night time temperatures withhot summer daytime temperatures large daily temperature fluctuations typical ofarid climates and a large excess of evaporation over precipitation

121 Annual PrecipitationWeir et al 1983 investigated climatic fluctuations within the Dolores River Basin andobserved that precipitation is correlated with elevation with highest precipitationamounts occurring within mountain areas surrounding the basin and markedlylower precipitation occurring within the central lower elevation basins Weir et al1983 provides contour maps of precipitation within the Dolores River Basin whichshow the area of the Sunday Mines Group to be among the driest portions of thebasin

Site specific climatic data are not available for the Sunday Mines Group Thereforetemperature and precipitation data were collected from the Uravan ColoradoNational Oceanic Atmospheric Administration NOAA weather station Precipitationat Uravan is estimated to be similar to the mine area based on an isohyetal mapprovided by Weir et al 1983 The period of record for this weather station extendsfrom 1961 through 2007

Table 121 shows the monthly total precipitation data for the period of record andFigure 121 is a box plot showing monthly total precipitation summary statisticsOctober August and September are the wettest months of the year with medianmonthly precipitation totals of 136 inches in125 in and 104 in respectively JuneFebruary December and January are the driest months of year with median monthlyprecipitation totals of 034 in 061 in 064 in and 070 in respectively The wettestmonth on record is October 1972 when 589 in of precipitation were recorded at theUravan station

Figure 122 compares the annual precipitation to the average annual precipitationover the period of record which shows extended periods of particularly high or lowprecipitation This data is shown in terms of water year totals from October throughSeptember The average annual precipitation for water years 1962 through 2007 is 126in Note a yearly total for water year 1961 could not be computed becauseprecipitation data from October through December of 1960 are not availableMaximum annual precipitation was recorded in 1997 at 1987 in while the minimumprecipitation was recorded in 1974 at 766 in

122 Direction and Velocity of Prevailing WindsData regarding wind speed and direction are presented in Table 122 and Figure 123

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Section 12

Climate

123 Mean Monthly Temperatures and RangesTable 123 shows the monthly average maximum and minimum temperatures for theperiod of record Large daily temperature fluctuations are typical for this semiarid toarid region with upwards of 30 Fahrenheit F to 40 F fluctuations between nightand day during most of the year Summer high temperatures can reach 100F orgreater and winter low temperatures can reach below 0 F however daytime highs inthe winter are normally above freezing 32 F

124 Evaporation RatesPan evaporation data are not available at the Uravan station Therefore panevaporation data were collected from a monitoring station at Dead Horse Creek nearNaturita Colorado The period of record for these data extends from 1971 to 1980Table 124 shows the pan evaporation data from the monitoring station at Dead HorseCreek near Naturita Colorado Figure 124 illustrates the relationship betweenaverage monthly precipitation measured in Uravan and average monthly panevaporation from the Dead Horse Creek monitoring station data This figure showsthat monthly pan evaporation is greater than monthly precipitation from Aprilthrough October During the late fall to early spring months November throughMarch pan evaporation is not measured due to regular freezing temperatures atnight and daily thaw Actual evaporation is likely to be less than pan evaporation dueto affects such as available soil moisture infiltration into the subsurface variations in

surface topography and differences related to the effect of the evaporation pan onmeasured evaporation rates Pan evaporation exceeds precipitation by approximately4 times based on the available data

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Section 13

Geochemical Data and Analysis

130 Geochemical Data and AnalysisDenison has completed extensive geochemical evaluations of ore and developmentrock during preparation of this EPP The work plan is presented in the DevelopmentRock Ore and Soil Characterization Data Collection Work Plan to Address DesignatedMining Operations DMO Status Sunday Mines Group and Van 4 CDM 20080 which isincluded as Attachment R The results of these investigations are presented in theEnvironmental Geochemistry Investigation of Rock and Soil Material Sunday Group MinesCDM 2009 which is included in this report as Attachment B This section provides asummary of the results of the geochemical investigations

131 Naturally Occurring Geological and GeochemicalConditions

There are two major categories of naturally occurring geochemical conditions that areimportant in relation to the Sunday Mines Group

1 Naturally occurring high salinity that results from outcrops of the ParadoxMember of the Hermosa Formation and

2 Natural enrichments of uranium vanadium and other metals which are

associated with the uraniumvanadium ore deposits in the Salt Wash Memberof the Morrison Formation

The affected areas of the Sunday Mines Group are located in Big Gypsum Valleywhich is formed from a collapsed salt intrusion The Paradox Member of the HermosaFormation is dominantly composed of rock salt halite NaCl and sylvite KC1 aswell as gypsumCaSO42H20 This unit crops out in several areas of lower BigGypsum Valley and salt originally present in the rock unit has dissolved and beendispersed in the environment Enrichments of sodium potassium and sulfate areexpected in this area as a result of dissolution and geochemical dispersion of rock saltand gypsum Natural enrichments of other elements such as selenium which isgeochemically associated with sulfate enrichment are also likely in the area Naturalevaporative concentration of sulfate and selenate salts would also be expected in thearid environment of Big Gypsum Valley

The Sunday Mines Group is located within the larger Uravan Mineral District andnatural enrichments of uranium vanadium and other metals are present in the areaAlthough the Sunday Group deposits are largely sub surface outcropping uraniumvanadium mineralization is present in numerous locations within the Big GypsumCreek watershed eg Cater 1955 Other elements that are associated with naturallyoccurring uraniumvanadium enrichment include arsenic molybdenum seleniumlead and copper Rose et al 1979

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Section 13

Geochemical Data and Analysis

132 Mine Rock Geochemistry1321Assessment of Potential Acid Forming RockThe section presents an assessment of the Sunday Mines Group development rockand ore regarding its potential to be acid forming Evaluation of the potential for acidmine drainage is based on evaluation of ABA data observational data regardingmineralogy of the mine rock and effluent pH data from MWMP column tests ABAdata for development rock and stockpiled ore show an overall low sulfur content andexcess of neutralization potential over acid potential in all samples ABA data arecompared to the empirical thresholds to evaluate the potential for the rock to generateacid in the future The first threshold is based on the NNP The NNP of developmentrock and ore samples collected at the Sunday Mines Group range from 325 to 2707tkt CaCO3 eq with a median value of 567 tkt CaCO3 eq These NNP values aregreater than the 20 tkt CaCO3 eq threshold which indicates that the developmentrock and ore has a low potential to generate acid ABA data are compared to thesecond empirical threshold in Figures 131 and 132 This threshold is based on theNPAP ratio All samples exceed the NPAP ratio threshold of 4 which indicates thatthe samples are unlikely to generate acid

The ABA data support field observations that visible sulfide minerals are not presentand that ubiquitous calcite is present in the development rock and ore Traceconcentrations of nitric acid soluble sulfur are present in several samples These traceconcentrations may be a result of trace barite BaSO4 within the samples rather thansulfide minerals

The effluent pH values from the MWMP analyses provide additional data to evaluatethe potential for the rock to be acid forming These data range from762 standardunits su to 898 su with a median of 816 su These development rock and ore sampledata indicate pH values well above the pH criteria of 58 su set forth in HRMMR112and support that the Sunday Mines Group development rock and ore areunlikely to generate acid rock drainage and are not considered acid forming material

1322Assessment of Potential Toxic Forming RockThis section presents evaluation of the potential for development rock and ore to betoxic forming as defined by HRMMR111

This evaluation considers mining conditions related to drainage and exposure andexamines

The potential for development rock and ore to contain detrimental amounts ofchemical constituents which could lead to direct contact risks to humans as a

result of incidental ingestion or inhalation and

The potential for development rock and ore to form leachate that containsdetrimental amounts of chemical constituents

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Section 13

Geochemical Data and Analysis

Potential for Direct Contact RisksA number of inorganic constituents of development rock were measured fromsamples collected from waste piles at the Sunday Mines Group Generallyconcentrations observed in these samples were higher than backgroundconcentrations measured in surrounding soils indicating that development rock doesreflect the mineralization that justified development of the mine These concentrationswere compared to screening criteria developed by BLM for metals in soils in RiskBased Criteria for Metals at BLM Mining Sites BLM 2004 With the exception of arsenicmaximum concentrations of 11 metals metalloids addressed by BLM were below riskmanagement criteria RMCs for direct contact with soils Further evaluation ofarsenic using site specific exposure considerations and measured bioavailability ofarsenic in development rock indicate that an appropriate site specific RMC is greaterthan maximum arsenic concentrations

Additional evaluation of metals other than the 11 constituents for which BLM RMCs

are available was performed using conservative regional screening levels RSLs fromEPA This evaluation did not identify any constituents in development rock atconcentrations exceeding their respective RSLs Notably concentrations of uraniumand vanadium target metals for mining operations were less than appropriatescreening criteria

Media besides soil are either not present within the affected areas of the SundayMines Group sediment surface water or are not accessible groundwater ThusRMCs based on direct contact with soils are appropriate for evaluating possible toxicforming materials In addition the most restrictiveie lowest RMC for arsenic isbased on a worker that might visit the site to perform such activities as control ofinvasive species and abatement of fire hazards If this worker is protected othervisitors to the site campers ATV riders surveyors will also be protected Based onthe BLM land management plan for this area future land use for the site is assumedto be non motorized recreation and thus future residents were not evaluated Basedon the above results the following conclusions are justified

A worker scenario is the most restrictive of applicable exposure scenarios forthe Sunday Mines Group and conclusions concerning toxic forming potentialare appropriately based on this receptor

Groundwater at the site is present only at a depth that precludes contact forvisitors to the site including campers ATV riders surveyors and workersThus RMCs based on direct contact with soil are appropriate for evaluatingtoxic forming potential

Metals concentrations in development rock are higher than regionalbackground and screening against health protective criteria is appropriate forevaluation of toxic forming potential

Screening using BLM RMCs and USEPA RSLs indicates that no constituentsare present at concentrations that suggest toxic forming potential arsenic isaddressed separately below

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Section 13

Geochemical Data and Analysis

A site specific RMC for arsenic using site specific exposure considerationsand measured arsenic bioavailability indicate that arsenic concentrations alsodo not suggest toxic forming potential

Overall available data for development rock present at the Sunday Mines Group doesnot suggest significant toxic forming potential No restrictions to currently assumedland use appear necessary for protection of human health for future range workers orother future site visitors to the site

It should be noted that risks to miners were not evaluated as part of this assessmentbecause mine safety including exposure to mine rock and minerals is regulated bythe Mine Safety and Health Administration MSHA in accordance with the federalMine Safety and Health Act of 1977 as amended and other federal laws andregulations Denisonsmining operations comply with these regulations

Potential Leachate Migration RiskThe potential for development rock or ore to form leachate containing metals isdependent on several factors including the following

The propensity for the rock to release metals to infiltrating water leaching Toevaluate this factor meteoric water mobility procedure MWMP analyses wereconducted on development rock and ore samples The MWMP analysis providesdata that can be used for a screeninglevel evaluation to assess if the rock pileshave the potential to generate leachate containing metals concentrations such thatthe rock could be considered a toxic forming material and

The volume of percolation through the rock piles Percolation was estimated usingtwo methods 1 a water balance approach that considers precipitationevaporation and available water holding capacity and 2 computer modelingusing a software program called UNSATH which provides a more rigorousevaluation through simulation of the processes of precipitation infiltrationevaporation and percolation Estimation of the volume of percolation through therock piles addresses uncertainties associated with the rock to soil ratio used in theMWMP tests as compared to actual field conditions and

A comparison of MWMP leachate data to the Colorado groundwater standardsindicates that a number of constituents were detected at concentrations that are

greater than the Colorado groundwater standards Below is a list of constituentsdetected in MWMP leachate that were detected at concentrations greater than thescreening criteria for each of the development rock and ore stockpiles

Topaz Mine Development Rock arsenic chloride molybdenum nitrate nitrite pHselenium sulfate uranium vanadium

Sunday Mine Development Rock antimony arsenic molybdenum nitrate nitriteselenium sulfate and vanadium

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Section 13

Geochemical Data and Analysis

St Jude Mine Development Rock arsenic fluoride molybdenum nitrate pHselenium sulfate uranium and vanadium

West Sunday Mine Development Rock arsenic cadmium chloride molybdenumnitrate nitrite pH selenium sulfate uranium and vanadium

Composite Ore Stockpiles antimony arsenic copper lead molybdenum nitrateselenium sulfate uranium and vanadium

Sunday Mine Low Grade Ore antimony arsenic molybdenum selenium sulfateand vanadium

Overall ore sample leachate metals concentrations are greater than the developmentrock leachate metals concentrations which is expected given that the ore hasincreased ore mineral content It should be noted that groundwater in the vicinity ofthe Sunday Mines Group is not classified with respect to designated uses CDPHERegulation 42 and therefore the human health drinking water and agriculturalcriteria are not formal standards for groundwater at the Sunday Mines Group Inaddition current groundwater uses in the vicinity of Sunday Mines Group do notinclude Human Health Drinking Water and Agricultural uses CDM 2009cAdditional information regarding current and future uses of groundwater in the areais included in Hydrogeologic Evaluation of the Sunday Mines Group San Miguel ColoradoCDM 2009b which is included in this document as Attachment 0 and also inSection 83 Existing and Future Groundwater Uses

The MWMP test is a screening tool and other factors must be considered to fullyevaluate the potential for development rock to produce leachate These additionalevaluations are presented in the following paragraphs Although groundwaterstandards are used to assist in the screening process there are no regulatorystandards that apply to MWMP test results

To further evaluate if the development rock should be considered as a toxic formingmaterial this section evaluates the potential for the rock piles to generate leachate insignificant volumes This is a factor of the climate of the area and the physicalcharacteristics of the piles Two methods were used in this analysis

A water balance approach and

Unsaturated flow modeling

Water Balance Estimation of Percolation This calculation estimates percolation throughthe Sunday Mine Group development rock areas using a water balance approachadapted from Guymon 1994 To clarify water balance terms percolation is thevolume of water that discharges from the base of the rock pile measured as cubicinches percolation per square inches of rock pile footprintie inches Infiltration isthe volume of water that infiltrates the surface of the rock pile measured as cubicinches percolation per square inches of rock pile footprintie inches Water that

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Month Potential

ET inPrecipitation

in

Actual

ET in

Runoff

in

Infiltration

in

Percolation

in

October 336 151 136 015 136 000

November 219 105 095 011 095 000

December 048 085 048 009 077 000

January 047 088 047 009 079 000

February 194 076 130 008 069 000

March 293 104 094 010 094 000

April 370 101 091 010 091 000

May 493 094 084 009 084 000

June 572 047 043 005 043 000

July 634 118 106 012 106 000

August 574 135 122 014 122 000

September 443 150 135 015 135 000

Annual Total 4233 1255 1129 125 1129 000

Section 13

Geochemical Data and Analysis

infiltrates into the pile may be subsequently removed from the pile by evaporation ortranspiration or the water may move downward in the pile and become percolation

Empirical information such as temperature and precipitation data and developmentrock characteristics are used for the water balance evaluation The procedure includedthe following activities

Compile temperature and precipitation data from a location as close as possible tothe site

Estimate runoff and evapotranspiration ET for the rock pile

Estimate moisture holding capacity of development rock based on site specificcapillary moisture data obtained from soil water characteristic curve SWCCtesting and

Estimate percolation through the development rock pile using a water balanceapproach

Details of the estimation method are included in Attachment 0 of this reportDevelopment rock samples were collected for physical property analyses includingsoil water characteristic curve SWCC testing Geotechnical laboratory data for thedevelopment rock samples including SWCC testing data are also provided inAttachment 0 Exhibit 131 presents the results of monthly percolation estimates foran average precipitation year

Exhibit 131 Estimated percolation through development rock areas for average precipitation

The estimate summarized in Exhibit 131 indicates that potential ET at the SundayMines Group exceeds average precipitation by a ratio of approximately 34 to 1Under average conditions available ET is adequate to evaporate water infiltrating thesurface of the rock piles A temporary increase in stored soil moisture would occurduring the months of January and February but this water would be removed from

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Month Potential

ET inPrecipitation

in

Actual

ET in

Runoff

in

Infiltration

in

Percolation

in

October 336 236 212 024 212 000

November 219 216 194 022 194 000

December 048 180 048 018 162 000

January 047 109 047 011 098 000

February 194 048 194 005 043 000

March 293 017 030 002 015 000

April 370 241 217 024 217 000

May 493 178 160 018 160 000

June 572 062 056 006 056 000

July 634 120 108 012 108 000

August 574 110 099 011 099 000

September 443 470 423 047 423 000

Annual Total 4223 1987 1788 199 1788 000

Section 13

Geochemical Data and Analysis

the pile by ET in later months Monthly estimated ET exceeds monthly precipitationduring all months of the year

Exhibit 132 presents a similar estimate using precipitation conditions the occurredduring the wettest year on record 1997

Exhibit 132 Estimated percolation through development rock areas or wettest year on record

The estimate summarized in Exhibit 132 for the wettest year on record indicates thatpotential ET exceeds precipitation by a ratio of approximately211and suggests thatwater infiltrating the pile also evaporates during the year During the months ofDecember and January the monthly precipitation exceeds the estimated monthly ETTherefore stored moisture within the rock pile would be expected to increase duringDecember and January However excess ET occurring in latter months is estimated tobe adequate to remove this moisture through evapotranspiration preventingpercolation through the pile The primary ET mechanism contributing to this waterbalance assessment is evaporation

Unsaturated Flow Modeling Unsaturated flow modeling was used to estimatepercolation through the rock piles in a more rigorous manner UNSATH Fayer 2000is a Fortranbased model that is used to simulate the one dimensional flow of water

vapor and heat in soils The code addresses the processes of precipitationevaporation plant transpiration storage and deep drainage The procedure for thisestimation included

Estimate physical and hydrological characteristics of development rock using sitespecific sampling and laboratory analyses

Compile climate data from locations as close as possible to the site

Estimate percolation through development rock areas using UNSATH

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Section 13

Geochemical Data and Analysis

The UNSATH model was chosen for this evaluation because it simulates both

downward movement of water into the development rock piles during infiltrationand upward movement of water from the rock piles caused by evaporationConsideration of upward unsaturated flow is critical for accurate simulation ofpercolation through mine rock piles in semiarid and arid environments Swanson etal 2000 Application of rigorous unsaturated flow models based on Richardsequation is becoming a widely used approach to simulate unsaturated flow throughmine waste piles eg Ford et al 2000 Swanson et al 2000 Fala et al 2005 Benson etal 2006 provides basic requirements for unsaturated flow models including

The model must simulate unsaturated flow in a rigorous manner ie must solveRichardsequation

The model must include a surface boundary simulating soil atmosphereinteractions precipitation infiltration evaporation runoff and

The model must integrate climatic data into the solution

UNSATH meets these requirements Although the EPA Hydrological Evaluation ofLandfill Performance model HELP has been used in the past for these types ofestimates HELP does not meet the criterion of rigorously simulating upwardmovement of water through the vadose zone through application of Richardsequation Benson et al 2006

Additional details of the calculation methods and procedure applied by UNSATHare presented in Fayer 2000 and are not discussed further in this document Acalculation brief model input files input data tables and model output files areincluded Attachment 0 The calculation brief provides a summary of the modelingapproach including description of model nodes and boundary conditions descriptionof climate data sources and definition of soil characteristics

Exhibit 133 summarizes the results of the modeling effort for the West Sunday andTopaz Mines on an annual basis Additional detail including daily percolationestimates are included in Attachment 0 The estimate was completed for the WestSunday and Topaz Mines and for average annual precipitation and the wettest yearon record

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Model Run Annual

Potential

ET in

Annual

Precipitationin

Annual

Actual

Evapin

Annual

Runoff

in

Annual

Infiltration

in

Annual

Percolation

in

West

Sunday

AveragePrecipitation

670 128 127 00527 127 00103

West

SundayWettest yearon Record

670 199 1807 0190 197 00106

Topaz

Average

Precipitation

670 128 127 00185 127 000822

Topaz

Wettest yearon Record

670 199 181 00619 198 000849

Exhibit 133 Summary of UNSATH modeling results

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Section 13

Geochemical Data and Analysis

Based on the UNSATH simulations the estimated percolation through the rock pilesis estimated to range from0008 to0011 inches per year The simulations show theimportance of evaluating upward movement of water from the rock piles caused byevaporation because the majority of water that infiltrates the surface of thedevelopment rock piles evaporates in the semiarid environment present at theSunday Mines Group

The UNSATH simulations suggest that significant percolation from the base of thedevelopment rock piles is unlikely However a small amount of percolation isestimated for all simulations The simulations further suggest that infiltration ofprecipitation followed by upward evaporative flux of water stored within thedevelopment rock areas are dominant mechanisms controlling the volume ofpercolation through the development rock areas Minor differences in the physicalcharacteristics of the development rock from West Sunday and Topaz mines as wellas the magnitude of annual precipitation are less important controls on the expectedvolume of percolation Additional sensitivity analyses were also conducted andindicate that the model is not particularly sensitive to modifications in convergenceparameters node spacing or initial moisture conditions Detailed sensitivity analysisinformation is presented in Attachment 0

Summary of Findings The water balance estimates and the UNSATH simulationsindicate that significant percolation from the base of the development rock piles isunlikely These evaluations further indicate that infiltration of precipitation followedby upward evaporative flux of water stored within the development rock areas are

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Section 13

Geochemical Data and Analysis

dominant mechanisms controlling the volume of percolation through thedevelopment rock areas Minor differences in the physical characteristics and themagnitude of annual precipitation are less important controls on the expected volumeof percolation

The results of these estimates correspond to the input parameters including thedevelopment rock physical and hydrologic parameters and the available climatedata Site specific climate data are not available for the West Sunday and Topazmines and differences between actual climate conditions at the site and the datacompiled from the Uravan and Montrose weather stations could result in variations inpercolation through the piles There are other site specific variations that are notdirectly accounted for in the model For example a rind of highly compacted tightsoil rock was encountered at the surface of the rock piles This rind likely reducesinfiltration by allowing for increase runoff and increased surface evaporation viaponding versus infiltration This site specific condition which could further reducemodeled percolation rates was not accounted for in the model

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140 Construction ScheduleThe Environmental Protection Plan EPP and related EnvironmentalProtection Facilities EPF includes three systems specifically 1 theStormwater Management Plan SWMP 2 a groundwater monitoring wellnetwork and 3 the installation of impervious liners under ore pads at each ofthe mine sites prior to reactivation of mining operationsDenison has an approved SWMP and is currently implementing ongoing siteinspections records documentation and reporting programs under theSWMP SWMP inspections have also been conducted by the ColoradoDepartment of Public Health and Environment and Denison has respondedpromptly to any requests for additional informationIncluded in Section 11 of this EPP are the proposed locations and constructiondetails for groundwater monitoring and compliance wells for the SundayComplex Denison commits to install these wells as soon as the designs andplans are approved including BLM approval dependent on site accessibilityduring spring weather In any case these EPF groundwater monitoring wellswill be installed during 2012 so that background sampling can commence assoon as practicalAll mines in the Sunday Complex are currently on Temporary Cessationstatus No ore stockpiles are present on any of the sites so no uncontrolledrunoff and related discharge of potentially radioactive solids is occurringPrior to reactivating any of these mines Denison must notify DRMS of theintentions to resume operations In conjunction with submitting formalnotification of the intentions to resume mining operations at a mine siteDenison will provide a detailed schedule for installation of the ore pad liner atthat site The schedule for reactivation of a given mine will provide at least 90days notification prior to the start of liner installation work Denison willcoordinate directly with DRMS to schedule preconstruction site inspections aswell as postconstruction inspections and approvals if required Uponcompletion of installation of each of the ore pad liners Denison will provideDRMS with certification by a Registered Professional Engineer or otherappropriately qualified person affirming that the facilities have beenconstructed in accordance with the approved designs Denison agrees andaccepts that no ore will be placed on the surface at any of the reactivatedSunday Mines sites until such time as the ore pad liner at each of thereactivated sites have been installed and the construction thereof approved byDRMS

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Certified Properties ASTM Standard Value

Thickness D5199 30 15 mil

Tensile PropertiesStrength at BreakElongationModulus at 100

D 882 Min73 lbsin

380

32 lbsin

Tear Strength D1004 Min 8 lbs

Dimensional Stability D1204 Max Chg 3

Low Temperature Impact D1790 Pass 20 deg F

Index Properties ASTM Standard Value

Specific Gravity D792 Typical 12 gcc

Water Extraction Percent LossMax

D1239 Max Loss 015

Volatile Loss Percent Loss Max D1203 Max Loss 07

Soil Burial

Break StrengthElongationModulus at 100

G160 Max Chg5

20

20

Hydrostatic Resistance D 751 Min 100 psi

Shear Properties ASTM Standard Value

Shear Strength D882 Min 584 lbsin

Peel Strength D882 Min 15 lbsin

150 Construction Quality AssuranceQuality ControlPlan

Adequate Quality Assurance Quality Control QAQC will be conducted inaccordance with manufacturersinstructions Exhibit 151 provides the standardspecifications for 30mil non reinforced PVC geomembrane liner used in buriedapplications in accordance with ASTM D 7176

Exhibit 151 PVC 30 mil Geomembrane Liner Specifications Used in Buried Applications

Prior to installation of the liner a QC inspector will verify that the surface bedding ofthe liner has been smoothened and freed of all sharp rocks all rock and stone greaterthan 1 inch diameter objects vegetation and other miscellaneous debris

Immediately prior to the placement of backfill the geomembrane seams and nonseam areas will be visually inspected by a QC inspector for defects holes or damagedue to weather conditions or construction activities At the QC inspectorsdiscretionthe surface of the geomembrane liner will be brushed blown or washed as necessaryif the amount of dust mud or foreign material inhibits inspection or functioning ofthe overlying material All damage to the geomembrane liner will be repaired prior tothe placement of backfill Detailed QAQC requirements are provided in the technicalspecifications provided in the design for DRMS review and approval Technicalspecifications are included as Attachment S

Denison will provide a certification by a professional engineer or other appropriatelyqualified professional that will confirm that the facilities were constructed inaccordance with the approved design plan

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160 Plant Growth Media and RevegetationThe Sunday Mines are existing facilities with new improvements consisting mainly ofapproved expansions of development rock piles as mining progresses ventilationsystems and exploration drilling for mine development Soils information is providedin Exhibit I of each of the individual permits for the Sunday Mines and is included inthis document by reference

Following mining development rock will be contoured to the hillside and coveredwith as much topsoil and inert material as available as outlined in Denisonsexisting110 and 112 permits to which this addendum will be an amendment Slopes of 25horizontal H1vertical V or less steep will be ripped on the contour of thereestablished postmine topography to a depth of 12 to 18 inches using a trackeddozer All lowgrade and flat terrain will be ripped to aid in water infiltration andretention of natural precipitation rain and snow accumulation and to deter soil lossdue to wind erosion The recontoured and graded surface facilities developmentrock area portal face roads and vent hole pads will be ripped in preparation forrevegetation

Following replacement of topsoil where available the surface of the soil will beroughened by ripping the soil A roughened soil surface exhibits lower soil losspotential increased moisture retention cooler surface soil temperatures and greaterseed germination The development rock will be graded along the contour andreseeded with approved seed mixes then monitored until natural vegetation is reestablished to an extent acceptable to the Division and the BLM

All ore stored on the surface is temporary and is moved to the White Mesa Mill on adaily to weekly basis At the time of reclamation all ore will either be shipped to theMill or placed in inert dry areas underground No low or high grade ore bearingmaterial will remain on the surface following reclamation

The surface water diversion ditches to the south and upgradient of the surface facilityareas will remain in place following reclamation These permanent diversion channelswill be left to minimize the amount of runoff flowing down the slopes of thereclaimed development rock areas to minimize erosion and sediment runoff Inaddition to sediment control BMPs the development rock area will also be ripped andseeded for revegetation Denison will monitor the sites semi annually to verify thatreclamation efforts are effective and will maintain the site for sediment and erosion

protection for the life of the operation

Additional information regarding reclamation is included in the existing minepermits which were approved previously by the Board This information isincorporated into this document by reference

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Federal or Colorado Listed as Threatened or Endangered or Candidate for ListingBald eagleMexican spotted owl

BonytailColorado pikeminnow

Humpback chubRazorback sucker

BLM Sensitive

Ferruginous hawkGunnison sage grouseTownsendsbigeared batSpotted batAllens bigeared bat

Fringed myotisYuma myotisBig free tailed batMidget faded rattlesnakeCanyon treefrog

Northern leopard frogNaturita milkvetch

Jones Blue star

Aromatic Indian Breadrood

San Rafael Milkvetch

170 Wildlife Protection

Section 17

Wildlife Protection

The following information on Wildlife Protection comes from the EnvironmentalAssessment of the Sunday Mines which was approved by the BLM in February of 2009

171 Threatened Endangered and Sensitive SpeciesA literature search was conducted to identify federally listed threatened endangeredor candidate plant and wildlife species as well as sensitive species and state sensitivespecies that could potentially be present in the mine affected area The literaturesearch included the Colorado BLM State DirectorsSensitive Species List Animalsand Plants BLM 2000 the US Fish and Wildlife ServicesUSFWS threatened andendangered species list for San Miguel County USFWS 2007 and the ColoradoDivision of WildlifesCDOW Threatened and Endangered List CDOW 2007 Thefollowing summarizes the results of the literature survey

Exhibit 171 Threatened and Endangered Species List

Field surveys of wildlife and plants identified in the literature search were conductedin May 2007 All proposed areas of disturbance were surveyed for the presence offederally listed threatened endangered or candidate plant species as well as forsensitive species state sensitive species and state rare plants as identified above Nofederally listed or BLM special status plant species were observed in the mine affectedareas No evidence of any federal or Colorado State threatened endangered orcandidate wildlife species was observed in the project area Additionally no BLMsensitive species were observed

A raptor survey was conducted during the May 2007 and April 2009 wildlife surveyand no occupied raptor nests were located within the survey area The surveys didnot attempt to identify individual bat species or occupied roost locations in anyinactive mine workings of the Topaz Mine because of safety issues related to theinactive mine workings Although mine workings that have remained inactive for along period of time may become habitat for bats no evidence of bats ie guano hasbeen found nor have any bats been encountered to date since mine rehabilitationbegan in areas of the underground mine workings in 2007

As an operational measure the Operator would provide information regarding thelocations of any proposed and future disturbances such as from exploration drillingwhen locations are determined to the BLM for additional surveys and identificationof possible threatened endangered sensitive or rare plants The Operatorspolicy onbats is addressed in an April 9 2007 letter to BLM

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Section 17

Wildlife Protection

Based on the literature search findings of the site surveys and the Operatorsoperational measures the environmental assessment has determined that no effect onthreatened endangered and sensitive species is present

172 Migratory BirdsBased upon habitat classifications for Colorado Partners in Flight PIF the SundayMines Group lies within Physiographic Region 87 the Colorado Plateau Areas withinthat Region that contain both pinonjuniper and semidesert shrubland habitat thatsupport a diversity of avian species including migratory birds in uplandcommunities in the western US Consequently the mine area could supportmigratory bird species that are protected under the Migratory Bird Treaty ActMBTA Colorado PIF priority species potentially occurring within these two habitattypes include black chinned hummingbird Archilochus alexandri black throated graywarbler Dendroica nigrescens Cassiri s kingbird Tyrannus vociferans gray flycatcherEmpidonax wrightii gray vireo Vireo vicinior horned lark Eremophila alpestrisjuniper titmouse Baeolophus ridgwayi pinyon jay Gymnorhinus cyanocephalus andScottsoriole Icterus parisorum PIF website updated 2008

USFWS maintains a Birds of Conservation Concern BCC list These are nongame

migratory avian species that the USFWS has targeted as conservation priorities butare not currently federally listed as threatened or endangered BCC species withpotential to occur in the proposed project area are golden eagle blackthroated graywarbler American peregrine falcon gray vireo pinyon jay and VirginiaswarblersVermivora virginiae One other BCC species associated with pinon juniperwoodlands yet unlikely to be located within the proposed project area is Lewiswoodpecker Melanerpes lewis Lewiswoodpeckers utilize pinon juniper habitats onlywhen they border riparian areas or when they are interspersed with taller ponderosapines that are more suitable as nest trees None of the PIF or BCC species wereidentified in the Sunday Mines Group BIOLogic 2007a and BIOLogic 2007b

None of the PIF or BCC species were identified in the project area BIOLogic 2007aand BIOLogic 2007b The Proposed Action therefore would not adversely affectmigratory birds

173 Wildlife in Contact with Development RockThe screeninglevel evaluation described further in Attachment B EnvironmentalGeochemistry Investigation of Rock and Soil Material Sunday Group Mines CDM 2009shows that most metals in development rock occur at concentrations that are lowerthan their respective screening criteria However cadmium concentrations exceed thescreening levels at some locations These include the Sunday Mine development rockarea and one location at the Topaz Mine development rock area Although local areasare present where cadmium concentrations exceed the BLM screening levels potentialtoxicity to wildlife are not further evaluated for several reasons

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Section 17

Wildlife Protection

The development rock areas where cadmium locally exceeds the wildlife screeningcriteria are very small relative to home andor foraging ranges for most ecologicalreceptors of interest which reduces the potential exposure levels

Threatened or endangered species or suitable habitat for those species are notpresent in the Sunday Mines Group Development Rock Areas Therefore completemitigation of potential risks to all individual wildlife organisms is not warranted

It is unlikely that potential adverse effects to wildlife related to direct contact riskswould cause a significant impact to overall populations and community of thereferenced species

174 Protection of Wildlife

No specific wildlife protection measures are proposed for the Sunday Mines Groupbecause threatened or endangered species are not present no designated chemicalsare used or stored on the mine sites and acid or toxic forming materials are notpresent

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180 Disposal of Tailings and Mine Sludge in Mine Workings

Currently no extractive metallurgical processing occurs at the mine sites As a resultno tailings or mine sludge exists at the Sunday Mines Group

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Section 19

References

190 References

BIOLogic Environmental 2007a Evaluation of Threatened Endangered Sensitive Speciesraptors and Noxious Weeds Proposed Exploration Drill Holes August

BIOLogic Environmental 2007a Evaluation of Threatened Endangered Sensitive Speciesraptors and Noxious Weeds Proposed Ventilation Holes and Waste Rock PileExpansion August

Bureau of Land Management BLM 2000 Colorado BLM State DirectorsSensitiveSpecies List Animals and Plants June Available onlinehttp wwwblmorgcostenBLMProgramsbotanySensitiveSpeciesListhtm1

BLM 2008 Draft San Juan Land Management Plan and Draft Environmental ImpactAssessment US Bureau of Land Management

CaterFW Jr 1955 Geology of the Hamm Canyon Quadrangle Colorado USGeological Survey Geologic Quadrangle Map GQ69

CDM Inc CDM 2008a Drainage Report Sunday Mine San Miguel County ColoradoMay

CDM 2008b Drainage Report St Jude Mine Mine San Miguel County Colorado May

CDM 2008c Drainage Report West Sunday Mine San Miguel County Colorado May

CDM 2008d Drainage Report Topaz Mine San Miguel County Colorado May

CDM 2008e Groundwater Characterization Data Collection Work Plan to Address

Designated Mining Operations DMO Status Sunday Mines Group San MiguelCounty Colorado CDM Project No 6498603 September

CDM 2008f Development Rock Ore and Soil Characterization Data Collection WorkPlan to Address Designated Mining Operations DMO Status Sunday Mines Groupand Van 4 Mine San Miguel County Colorado CDM Project No 6498603September

Chafin DT 2002 Effect of Pardox Unit on the Dissolved Solid Load of the Dolores Rivernear Bedrock Colorado 19882001 US Geological Survey Water Resources InvestigationReport WRIR024275

Chilingar GV 1963 Relationship between porosity permeability and Grain SizeDistribution of Sands and Sandstones Proceedings of International SedimentologicalCongress Amsterdam Antwerp

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Colorado Department of Public Health and the Environment CDPHE 2010Memorandum ofAgreementfor the Implementation of SB181 Amendments to theColorado Water Quality Control Act Pertaining to the Regulation ofMetal Mines

Colorado Division of Wildlife CDOW 2007 Threatened and Endangered ListAvailable online httpwildlifestatecousWildlifeSpecies SpeciesOfConcern ThreatenedEndangeredList ListOfThreatenedAndEndangeredSpecieshtm

CraigLC Holmes CN Cadigan RA Freeman VLMullensTE WeirGW1955 Stratigraphy of the Morrison and Related Formations Colorado Plateau Region APreliminary Report US Geological Survey Bulletin 1009EDominico PA andSchwartz FW 1990 Physical and Chemical Hydrogeology John Wiley and Sons NewYork

Freeze RA CherryJA 1979 Groundwater Prentice Hall Inc Englewood CliffsNew Jersey

GuilbertJM Park CF 1986 The Geology of Ore Deposits WH Freeman andCompany New York

Jobim DA 1962 Relation of the Transmissive Character of the Sedimentary Rocks of theColorado Plateau to the Distribution of Uranium Deposits US Geological Survey Bulletin1124

Langmuir D Aqueous Environmental Geochemistry Prentice Hall Upper SaddleRiver New Jersey

RoseAW Hawkes HEWebbJW 1979 Geochemistry in Mineral ExplorationAcademic Press London

Section 19

References

Showalter J 2008 Jon Showalter Denison Mines USA Corp Project GeologistPersonal Communication to Mark Nelson CDM

Tetra Tech 2007 Drainage Report for Topaz Mine San Miguel County Colorado April

US Environmental Protection Agency EPA 2009 Statistical Analysis of GroundwaterMonitoring Data at RCRA Facilities Unified Guidance EPA 530R09007 March

US Fish and Wildlife Service USFWS 2007 List of Threatened Endangered andCandidate Species for San Miguel County Colorado Available onlinehttpmountainprairiefwsgovendspp

Weir James E Maxfield E Blair Zimmerman Everett A 1983 Regional Hydrology ofthe Dolores River Basin Eastern Paradox Basin Colorado and Utah USGS Water

Resources Investigations Report 834217

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Wolkersdorfer Ch 2006 Water Management at Abandoned Underground MinesFundamentals Tracer Tests Modelling Water Treatment Springer Berlin

Younger PL BanwartSA Hedin RS Mine Water Hydrology PollutionRemediation Kluwer Academic Publishers Dordrecht

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Section 19References

193


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