Emigrant Crevice Withdrawal: Minerals Reasonably Foreseeable Development March 2018

Emigrant Crevice Withdrawal Minerals Draft

USDA Forest Service Emigrant Crevice Withdrawal: Minerals Reasonably Foreseeable Development March 2018

Prepared by Mindy Sue Vogel

Emigrant Crevice Withdrawal Minerals Draft

Table of Contents 1 Section 1: Introduction ...... 1 1.1 Purpose ...... 1 1.2 Scope ...... 1 1.3 Study Area ...... 2 2 Section 2: Authorities ...... 2 2.1 Federal Laws ...... 2 2.1.1 1872 Mining Law ...... 2 2.1.2 1892 Organic Act ...... 3 2.1.3 1955 Surface Use Act ...... 3 2.1.4 1955 Mining Claims Rights Restoration Act ...... 4 2.1.5 1970 Mining and Mineral Policy Act ...... 4 2.1.6 1976 Federal Land Policy and Management Act ...... 4 2.2 Federal Regulation ...... 4 2.2.1 36 CFR 228 ...... 4 2.2.2 43 CFR 2310 ...... 5 2.3 Forest Service Policy ...... 5 2.3.1 FSM 2760 ...... 5 2.3.2 FSM 2800 ...... 5 2.3.3 Gallatin Forest Plan ...... 6 3 Section 3: Analysis Considerations ...... 6 3.1 Permitting ...... 6 3.1.1 Stages of Mine Development ...... 6 3.1.2 Plan of Operations ...... 8 3.1.3 Valid Existing Rights ...... 9 3.1.4 NEPA Process ...... 10 3.1.5 Other Agency Requirements ...... 11 3.2 Assumptions and Uncertainties ...... 12 3.2.1 Legislative Changes ...... 12 3.2.2 Technology ...... 13 3.2.3 Commodities of Interest ...... 14 3.2.4 Markets and Trends ...... 14 3.3 Summary of Considerations ...... 14 3.3.1 Permitting and Legislative Changes ...... 14 3.3.2 Commodities and Markets ...... 15 3.3.3 Past Insights for Future Mining ...... 16 4 Section 4: Mineral Activity ...... 17 4.1 Past Mineral Activity ...... 17 4.1.1 Emigrant ...... 17 4.1.2 Crevice ...... 21 4.2 Present Mineral Activity ...... 24 4.2.1 Emigrant ...... 25 4.2.2 Crevice ...... 26 4.3 Future (Potential) Mineral Activity ...... 27 4.3.1 Common to Emigrant and Crevice...... 28 4.3.1.1 No Action ...... 28 4.3.1.2 Proposed Action ...... 29 4.3.2 Emigrant ...... 30 4.3.2.1 No Action ...... 30 4.3.2.2 Proposed Action ...... 34 Emigrant Crevice Withdrawal Minerals Draft

4.3.3 Crevice ...... 36 4.3.3.1 No Action ...... 36 4.3.3.2 Proposed Action ...... 40 5 Section 5: Summary and Conclusions ...... 42 6 Section 6: References ...... 44

Figures 1. Stages of the life of a mine ...... 8

Tables 1. Recorded production from the Emigrant Mining District ...... 18 2. Summary of historic mining within the Emigrant Mining District ...... 18 3. Summary of historic mining within the Crevice / Jardine Mining District ...... 22 4. Active mining claims within the proposed withdrawal area (post-segregation) ...... 23 5. Identified resource calculations for select deposits in the Emigrant Mining District ...... 32 6. Summary of reasonably foreseeable development scenarios ...... 42

Maps 1. Emigrant Crevice proposed withdrawal general location map ...... 47 2. Claim map and targets in the Emigrant proposed withdrawal area ...... 48 3. Claim map and targets in the Crevice proposed withdrawal area ...... 49 4. Absaroka-Beartooth area’s Historic Mining Districts ...... 50

Emigrant Crevice Withdrawal Minerals Draft

1 Introduction The Proposed Action considered in the Emigrant Crevice Mineral Withdrawal’s environmental analysis is the withdrawal of approximately 30,370 acres (ac) of Federal lands from location and entry under the United States mining laws for 20 years, subject to valid existing rights. These lands are administered by the United States Department of Agriculture, Forest Service (FS). The November 22, 2016 Notice of Application for Withdrawal in the Federal Registrar indicated the Bureau of Land Management’s (BLM) receipt of the FS’s application for this proposed withdrawal from locatable mineral entry. The FS’s purpose for the proposed withdrawal is for protecting and preserving the scenic integrity, important wildlife corridors, and high quality recreation values of the Emigrant and Crevice areas located in the Custer Gallatin Nation Forest (CGNF), Park County, Montana. Publication of the Federal Register notice initiated a two-year segregation of the subject lands from location and entry under the mining laws, subject to valid existing rights. This segregation period is intended to allow for an environmental analysis of the withdrawal application along with a decision by the Secretary of the Interior in accordance with the Federal Land Policy and Management Act (FLPMA) Section 204. 1.1 Purpose The purpose of this Reasonably Foreseeable Development (RFD) report is to provide supplemental information regarding potential mineral development within the proposed withdrawal’s analysis area. This report predicts the amount and type of potential future locatable mineral exploration and development that could occur within the boundaries of the proposed withdrawal area. For comparison purposes, predictions are made for both the No Action and Proposed Action alternatives over the proposed 20-year withdrawal period. The predictions address the potential for future mining, will be used to analyze possible impacts to other resources, and will serve as a basis for the National Environmental Policy Act (NEPA) analysis, including the cumulative impacts analysis. This will, in turn, help determine the potential effects of withdrawing or not withdrawing the proposed area from locatable mineral entry. The RFD is, by its nature, speculative in attempting to predict future types and levels of locatable mineral exploration and development. The important feature of the RFD is not its numeric accuracy when it comes to specific features, but rather that it uses consistent assumptions to portray the relative levels of reasonably foreseeable future actions across the alternatives. While it attempts to predict future mining activity, the RFD is intended only to help the agency analyze and disclose the effects of the Proposed Action compared to the No Action Alternative, and cannot be used to assert or refute the validity of a mining claim or for any other purpose. This forecast does not constitute proof that mineable mineral deposits are present or absent. 1.2 Scope The scope of this RFD analysis incorporates only locatable minerals; salable and leasable mineral resources are not considered as they are not subject to the proposed withdrawal as written. The mineral commodities within this proposed area that could be the focus of future exploration, development or mining activity are gold, silver, copper, and molybdenum with minor activity regarding lead, zinc, and tungsten (reference #MPR). The lands discussed in the RFD primarily include National Forest System (NFS) lands with federal public domain minerals that are managed by the BLM. However, activities on non-federal lands as well as private mineral estates within the proposed withdrawal boundary are also discussed where applicable to support the cumulative effects analysis, and because the proposed withdrawal applies to any lands or interest in lands that could be acquired by the U.S. in the future as long as the withdrawal were to remain in effect at that time. Specifically, this includes approximately 1,668 acres of non-federal lands and/or split estate lands with non-federal mineral rights within the proposed withdrawal boundary (reference #lands report). The prediction of future exploration and mining development scenario is initially limited in scope to the proposed area and is provided for the No Action Alternative analysis (i.e. what is reasonably expected to occur in the absence of the withdrawal). Then, the methods and results of that analysis were adjusted based

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on the constraints of the Proposed Action. The prediction of future mining is based on a number of assumptions (Section 3.3.3) and is provided solely to establish a maximum level of expected mineral activity to be analyzed as part of the impact assessment of each alternative in the NEPA analysis. These mining activity assumptions, in conjunction with existing conditions, serve as the basis for the evaluation and disclosure of the environmental consequences associated with the two alternatives. An RFD is a prediction based on the known or inferred locatable mineral resource potential of the lands in the proposed withdrawal area using a set of assumed future economic, regulatory, and legal conditions. While historic mine development can give some idea of future development, there are other factors that affect the pace of future development. As such, this prediction is subject to deviations as additional geologic and mineral resource data become available, technology improves, market prices fluctuate, and/or the economic, regulatory, and/or legal circumstances change (Section 3.2 and 3.3). These factors and others could contribute to a different assumed future development pattern than was experienced in the past. 1.3 Study Area A complete legal description of the proposed withdrawal area boundaries can be found in the project record (reference #) of the associated environmental analysis. The proposed withdrawal area consists of two parcels: Emigrant (~15,808 acres of NFS lands) and Crevice (~14,794 acres of NFS lands) all within the Custer Gallatin Nation Forest, Montana (Map 1). Both land parcels have steep mountainous terrain, ranging in elevation from around 5,000 ft. above sea level (asl) to nearly 11,000 ft. asl. Due to the significant winter snow accumulation typical of this high elevation country, access is generally limited to May through October. The Emigrant and Crevice proposed withdrawal area is adjacent to the Absaroka-Beartooth Wilderness (Map 1), which was designated by Congress in 1978 (PL 95-249) (modified in 1983 by PL 98-140 and again in 1984 by PL 98-550). The boundary of the wilderness area appears to intentionally exclude both the Emigrant and Crevice areas, likely due to the higher mineral potential and historic mining activity. However, the congressional decision and legislation for designating the Absaroka-Beartooth Wilderness does not specifically speak to why other lands were not included within the designation. The boundaries of the proposed withdrawal encompass approximately 30,370 acres of federal land and approximately 1,668 acres of non-federal lands. Of the non-federal land, almost all is patented mining claims, on which the majority of historic mining activity has occurred within this area. The patented lands are relatively central within both the Emigrant and Crevice parcels, and the private lands mostly coincide with the areas having the highest known mineral development potential (reference #MPR). Current unpatented mining claims within the proposed withdrawal area tend to surrounded the patented claim blocks, and consist of 226 lode claims (~4,669 ac), 3 placer claims (~159 ac), and 6 mill site claims (30 ac) (Maps 2 and 3; Section 4.2).

2 Authorities When processing a withdrawal for locatable minerals, there are a number of regulatory authorities to review for compliance. Relevant mining laws, regulations, and policy pertaining to this proposed withdrawal are discussed below. 2.1 Federal Laws 2.1.1 1872 Mining Law The General Mining Law of 1872, as amended, gives a U.S. citizen, or a corporation organized under state law, a statutory right to go onto public domain federal lands open to mineral entry to stake or “locate” a mining claim for the purpose of mineral prospecting, exploration, development, and extraction of locatable minerals. Locatable minerals include metallic minerals (gold, silver, lead, zinc, etc.), nonmetallic minerals

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(fluorspar, asbestos, mica, gemstones, etc.), and certain “uncommon variety” minerals having a unique or special quality giving it a higher value. The Mining Law consists of five basic elements including discovery of a valuable mineral deposit, location, recordation, maintenance of mining claims, and patenting1. For more information on these five elements, see https://www.blm.gov/sites/blm.gov/files/MiningClaims.pdf. Under the Mining Law, citizens have the right to locate the following types of mining claims and sites as defined by the BLM (43 CFR 3832; FSM 2811.3): 1. Lode Claim = in-place, hard rock deposit consisting of a zone of veins, veinlets, or disseminations of a valuable mineral; claims may not exceed 1500 ft. by 600 ft. in size. 2. Placer Claim = non-lode deposits, typically unconsolidated material containing concentrations of valuable minerals (i.e. placer gold) or nonmetallic bedded deposits (i.e. gypsum); claims may not exceed 20 acres for an individual claimant or 160 acres for an association of eight locators. 3. Mill Site = located on non-mineralized land as either a (1) dependent mill site whereby mill feed is sourced from associated lode or placer mining claims, or (2) independent mill site whereby the mill is essentially a custom mill taking feed from area mines and not associated with any particular lode or placer claims; mill site may not exceed five acres. 4. Tunnel Site = subsurface right-of-way used for tunnel exploration of potential lode deposits up to a distance of 3,000 ft.; once a mineral discovery is made, locator must file a lode claim. All NFS lands classified as public domain lands that have not been appropriated, withdrawn, or segregated from location and entry, are open to prospecting for locatable minerals (16 U.S.C. 482). If NFS lands are withdrawn or segregated (as is the case with the subject lands), no new mining claims may be located under the 1872 Mining Law. However a segregation or withdrawal is made “subject to valid existing rights”; therefore, an existing mining claimant may continue to hold and develop “valid” mining claims that predate the segregation or withdrawal, subject to all applicable statutes and regulations (Section 3.1.3 for valid existing rights). 2.1.2 1892 Organic Administration Act The Organic Administration Act, as amended, provides the main statutory basis for management of the NFS lands with goals to improve and protect the resources. This Act authorized the FS to regulate surface use and occupancy, such as mineral operations, on NFS lands and to develop mineral regulations. The FS’s locatable mineral regulations were later promulgated in 1974 and can be found in the Code of Federal Regulation (CFR), Chapter 36, Part 228, Subpart A (Section 2.2.1). 2.1.3 1955 Surface Use Act The Surface Use Act amended the General Mining Act of 1872, including the following: (1) removed from mineral entry the common varieties of minerals such as sand, gravel, stone, pumice, pumicite, and cinders and classified these materials as salable minerals requiring either a sales contract or a free-use permit from the appropriate federal land management agency; (2) gave authority to the federal land management agencies to manage surface resources, including surface vegetative material; and (3) placed limitations on claimants’ surface rights stating that mining claimants shall not use claims for any purposes other than mining related activities, including prospecting, mining, processing operations, and/or uses reasonably incident thereto. However, this Act provided claimants an opportunity to file with the BLM to retain surface rights on claims located prior to the Act that had a valid discovery. Upon a timely filing of a claimant’s statement to retain surface rights, a government geologist/mining engineer/mineral examiner had to make the determination

1 In October 1994, Congress passed a moratorium on the expenditure of funds to process patent applications; therefore, no new mining claims can file for patent with the BLM. The moratorium has been renewed annually through the various Interior Appropriations Acts, and the duration of this moratorium is unknown.

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whether or not a claim had a valid discovery, therefore allowing for retention of surface rights. Surface rights included the possession and removal of timber as reasonably necessary in conducting mining operations. There are three existing lode claims within the proposed withdrawal area that filed for and obtained surface rights (Section 4.2). 2.1.4 1955 Mining Claims Rights Restoration Act The purpose of the Mining Claims Rights Restoration Act of 1955 (PL 359) was to reopen to mineral entry and claim location lands that had been withdrawn or reserved for power development and other purposes. However, there are a couple exceptions for lands that were under license, permit or preliminary permit under the Federal Power Act or other Act of Congress. There are two power site withdrawals within the proposed withdrawal area that are subject to this Act. 2.1.5 1970 Mining and Mineral Policy Act The Mining and Mineral Policy Act states that the continuing policy of the Federal Government is to foster and encourage private enterprise in the development of economically sound and stable domestic mining and minerals industries and the orderly economic development of domestic mineral resources. This Act must be considered when making federal decisions regarding mineral and mining actions, such is the situation with this proposed action. 2.1.6 1976 Federal Land Policy and Management Act (FLPMA) Similar to the establishment of Organic Act for the FS, the FLPMA established and governs the way in which the BLM manages public land for multiple-use to serve present and future generations. Section 204 of FLPMA gives the Secretary of Interior general authority to make, modify, extend, or revoke most mineral withdrawals. Furthermore, this Act affects the recordation and maintenance of mining claims. The FS must apply to the Secretary of Interior for mineral withdrawal actions on NFS lands in accordance with 43 CFR 2310.1-2 (Section 2.2.2). 2.2 Federal Regulations The FS and the BLM have promulgated management regulations governing locatable mining operations conducted under the Mining Law. Operators on NFS lands must comply with the regulations at 36 CFR 228 Subpart A, while operators on BLM lands must comply with the regulations at 43 CFR 3809, as well as the use and occupancy regulations at 43 CFR 3715. The federal lands in this proposed withdrawal are all managed by the FS and therefore subject to 36 CFR 228 Subpart A; however, BLM’s regulation 43 CFR 2310 would still be applicable, as described below. In addition, operators must comply with all other federal, state, and local laws and regulations. 2.2.1 36 CFR 228 Subpart A These regulations apply to locatable mineral operations conducted under the US mining laws as they affect surface resources on NFS lands under the jurisdiction of the Secretary of Agriculture. It is the purpose of these regulations to set forth rules and procedures through which surface use of NFS lands in connection with operations authorized by the US mining laws (30 U.S.C. 21–54) shall be conducted so as to minimize adverse environmental impacts on NFS surface resources. Mining operations are defined as all functions, work, and activities in conjunction with prospecting, exploring, developing, mining, or processing of mineral resources, and all uses reasonably incident thereto, including roads and other means of access on lands subject to the regulation in this part, regardless of whether said operations take place on or off mining claims. The 36 CFR 228 Subpart A regulations outline the process and requirements for FS notification and processing of proposed mining operations. It describes the two levels of mining activity (Notice of Intent (NOI) and Plan of Operations (Plan)) and outlines what is required for notification, including a detailed description of the operations, a reclamation plan, and bond requirements. For additional information on the mine Plan permitting process, see Section 3.1.2.

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2.2.2 43 CFR 2310 Although the proposed withdrawal is on NFS lands, the administration of the US mining laws is primarily the responsibility of the Department of the Interior through the BLM. The Secretary of Interior ultimately decides whether or not to make, modify, or revoke a withdrawal. For a withdrawal of more than 5,000 acres from mineral entry, as has been proposed for this project, a mineral resource assessment must also be completed to identify mineral resources within the proposed area of withdrawal (43 CFR 2310.3-2). The analysis must provide information on the general geology, known mineral deposits, past, and present mineral production, mining claims, mineral leases, evaluation of mineral potential, and review of mineral economics. Therefore, as part of this proposed withdrawal process, the FS worked collaboratively with the BLM to complete a mineral potential report (MPR) to meet the intent of 43 CFR 2310 (see reference #MPR). 2.3 Forest Service Policy 2.3.1 FSM 2760 Forest Service Manual (FSM) 2760 addresses withdrawal policy, including authorities and responsibilities. A withdrawal is a management tool for withholding an area of federal land from settlement, sale, location, or entry under some or all of the general land laws, including the US mining and mineral leasing laws. Withdrawals are often used for the purposes of limiting activities under those laws in order to maintain other public values in the area, or reserving the area for a particular public purpose or program. FSM 2760 directs the agency to only include the minimum amount of lands in any proposed withdrawal that are necessary for the intended use or resource concern. As stated in FSM 2761.02, the FS objectives when evaluating the need for a withdrawal are to: 1. Protect US improvements and other unique values that are subject to disposition or destruction under the public land laws; 2. Provide a consistent and efficient withdrawal program that meets land and resource management objectives; 3. Ensure cooperation and coordination with the Secretary of the Interior and the BLM; and 4. Encourage mineral activity where mineral extraction is the best use of the site. 2.3.2 FSM 2800 The FSM 2800 states that the mission of FS minerals management is to encourage, facilitate, and administer the orderly exploration, development, and production of mineral and energy resources on NFS lands to help meet the present and future needs of the Nation. In managing the use of surface resources, the FS should attempt to minimize or prevent, mitigate, and repair adverse environmental impacts on resources by imposition of reasonable conditions that do not materially interfere with such operations. FSM 2800 reiterates that the authority to manage the exploration and development of mineral and energy resources on NFS lands is jointly shared between the Secretary of Agriculture and the Secretary of the Interior. Therefore, the FS has entered into interagency agreements with the Department of the Interior agencies to cooperate and coordinate in managing federally owned minerals within NFS lands (FSM 2801.3). In particular, FSM 2810 describes the administration of the laws and regulations relative to locatable minerals on public domain lands managed by the FS. This section covers the authorities, types of mining claims, claimant rights and obligations, withdrawals, in addition to surface management procedures in accordance with 36 CFR 228 Subpart A. For additional information on the surface management procedures including the administration and processing of mineral proposals, see Section 3.1.2. Additionally, FSM 2830 describes the agencies authority and policy related to reserved and outstanding mineral rights, which directly applies to certain lands within the proposed withdrawal boundary.

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2.3.3 Gallatin Forest Plan The lands contained within this proposed withdrawal also fall under the direction of the 1987 Gallatin Forest Plan, as amended. As stated in the 1987 Forest Plan under the Forest-Wide Standards, “Future withdrawals from mineral entry will be evaluated based on the criteria contained in 43 CFR 2310 and section III of Appendix D” of the 1987 Forest Plan. Additionally, the 1987 Plan provides brief guidance on the processing and review of withdrawals, in addition to the following evaluation criteria for proposed withdrawals: 1. Are there other ways available to protect the resource values (for instances, existing statutes and regulations, rights-of-way, cooperative agreements)? If no, then: 2. Are the values at risk of such a nature that a significant financial, social, or cultural loss could occur? 3. What is the monetary value of the physical improvements at risk? (a) What is the current and projected use demand? (b) If the withdrawal is for a proposed development, have funds been allocated for this project? (c) Is the resource unique and/or irreplaceable? If yes, then: 4. Does the withdrawal area have a high mineral potential or are there nearby mining claims or mining activities? If yes, then: 5. Initiation of withdrawal action recommended. The Forest Plan, as amended, also contains locatable minerals management standards specific to geographically defined Management Areas (MA). The Emigrant portion of the proposed withdrawal area contains acreages of MA 3, 13, 15, 17. The Crevice portion of the proposed withdrawal area contains acreages of MA 13, 14, 15, 26. Both Emigrant and Crevice areas contain unmapped acreages of MA 7. Forest Plan MA standards related to locatable minerals management include: MA 7 (unmapped riparian management areas): Require Plans of Operation for suction dredging and placer mining. MA 13 (forested habitat within the grizzly bear Recovery Zone or Primary Conservation Area): Limit mineral activities to specific area or periods to reduce mortality risk and reduction in habitat effectiveness. MA 14 (big game winter ranges located in either open grasslands or a mosaic of grasslands and forested habitats and located within the grizzly bear Recovery Zone or Primary Conservation Area): Limit mineral activities to specific areas or periods to reduce grizzly bear mortality risk and maintain elk habitat quality. MA 15 (open grasslands or a mosaic of grasslands or steep rocky slopes interspersed with timber which are located in the grizzly bear Recovery Zone or Primary Conservation Area and provide for dispersed recreation and livestock use): Limit mineral activities to specific areas or periods to reduce grizzly bear mortality risk and maintain elk habitat quality.

3 Analysis Considerations 3.1 Permitting 3.1.1 Stages of Mine Development The logical development of a mineral resource from beginning to end can be divided into five stages: prospecting, exploration, development, production, and reclamation (USFS, 1995). The stages are not necessarily sequential, but can cycle back and forth between stages as seen in Figure 1. Additionally, each progressive stage requires the application of more discriminating (and generally more expensive) techniques over a successively smaller land area to identify and develop an economic mineral deposit.

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1. Prospecting: This initial stage includes a range of activities from reconnaissance with literature searches for publications, maps, and photos, to field work collecting stream sediment, soil, or rock samples for analysis (USFS, 1995). Prospecting could also include other types of geochemical and/or geophysical studies along with remote sensing with aerial photography or satellite imagery on a broader scale. Common types of surface-disturbing activity associated with prospecting include sampling using mostly hand tools, metal detecting, panning, and placement and maintenance of mining claim monuments. Most of this work can be conducted under a FS Notice of Intent per 36 CFR 228.4. 2. Exploration: The next logical stage in mineral development is exploration (USFS, 1995). This typically occurs upon location of sufficiently anomalous mineral occurrence or favorable occurrence indicators. Activities that take place during exploration include those utilized during prospecting, but at a more intense level in a more focused area. In addition, activities such as road building, trenching, and drilling are often conducted at this stage. An exploratory adit or shaft may be driven to collect data and obtain further information should early exploration prove promising. If the prospect already has underground workings, they may be sampled, drilled, or even extended during this stage. Exploration activities can use mechanized earth moving equipment (excavators, backhoes, drill rigs, etc.) and may involve the use of explosives. If initial results are encouraging, the exploration program would expand to determine the limits of the deposit. Most surface disturbance associated with exploration projects on NFS lands is less than 15 acres and often would require an approved Plan of Operations per 36 CFR 228.4 (Section 3.1.2).

3. Development: If exploration results show that an economically viable mineral deposit may be present, activity would intensify to obtain detailed knowledge sufficient to delineate possible reserves, mining methods, and mineral processing requirements (USFS, 1995). This would involve applying all the previously used exploration tools in a more focused effort. Once enough information is acquired, a feasibility study would be made to decide whether to proceed with mine development and what mining and ore processing methods would be used. Typical development activities can include infill drilling; sampling for metallurgical, geotechnical, and/or environmental needs; construction of the processing facilities, offices, and a laboratory; driving of development workings if the property is to be mined underground, or pre-stripping if it is to be mined through open pit methods; drilling of water supply wells; construction of roads; development and installation of environmental monitoring sites/stations; and placement of utilities like power and water lines (USFS, 1995). This stage would require an approved Plan of Operations from the FS. 4. Production: The fourth stage commences once the mine begins actual mineral production (USFS, 1995). Activities that occur during mine production can include mining (surface and underground) and processing of ore, tailings disposal, waste rock placement, solution extraction, metal refining, construction and use of support facilities, use of heavy earthmoving equipment, explosives, and general construction activities. The size of mines varies greatly, therefore not all mines would require all of these facilities and equipment. Concurrent with the production stage there can be continued exploration efforts occurring in an effort to expand the mine’s resources/reserves. The total acreage involved in mine production can range from a dozen acres for a compact underground mine with offsite milling to several thousand acres for an open pit surface mine with onsite processing facilities. This stage would also require a FS approved Plan of Operations. 5. Reclamation: Throughout the various mine stages, different types of reclamation can occur including concurrent with operations (prospecting, exploration, development, and production) along with interim and final closures (USFS, 1995). Common reclamation activities include regrading disturbed areas, removal of equipment and facilities, surface water management, revegetation, noxious weed management, monitoring, and ensuring the site is left in a safe and

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stable condition. Project specific reclamation plans and bonds are required as part of the approved Plan of Operations. Figure 1: Stages in the life of a mine with example tasks

3.1.2 Plan of Operations As stated in 36 CFR 228 Subpart A, the distinction between whether or not a Notice of Intent (NOI) and/or a Plan of Operations (Plan) is required is at the discretion of the District Ranger. Under FS regulations, a NOI is submitted to the District Ranger who determines whether the proposed operations would cause significant disturbance of surface resources. The FS then notifies the operator (within 15 days) whether a Plan is required before the proposed activity can be undertaken. If the District Ranger determines that any operation is causing or will likely cause significant disturbance of surface resources, the operator must submit a proposed Plan to the District Ranger for review and approval. The Plan permitting process begins once a proponent submits a minerals proposal to the FS. However, if the proposed Plan is located on an active claim within segregated lands, the District Ranger has the discretion on whether or not to require a valid existing rights (VER) determination. If the proposed Plan is located on withdrawn lands, the Plan processing would first be subject to a valid existing rights (VER) determination as stated in FSM 2803.5. There are only certain allowable activities that can be conducted prior to a VER determination in accordance with 43 CFR 3809.100(b) (note: the FS does not have specific regulations and/or policy regarding what activities are allowed; therefore the FS strives to be consistent with the BLM regulations). For more information on VER, see Section 3.1.3. Upon FS receipt of a proposed Plan, it is reviewed for completeness by the agency. The review should identify any additional data that the operator must provide to allow for assessment of impacts, to ensure compliance with applicable laws and regulations, or for any commitments that must be made by the operator to minimize adverse environmental impacts on NFS surface resources. The deficiencies identified during

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a completeness review are provided to the proponent, who then revises the Plan as appropriate and resubmits it to the FS. Once the Plan is declared “complete” by the FS responsible official, it is ready for the environmental analysis to be prepared in accordance with the NEPA (Section 3.1.4). The NEPA requires the agency to analyze and disclose project impacts and also allows for public involvement. After the public comments have been considered and the environmental disclosure is complete, the agency issues its NEPA decision including any required mitigation or monitoring measures deemed necessary by the agency. The NEPA decision is not authorization to operate, only a decision indicating the FS’s intent to approve the final mineral Plan once the following criteria has been met: 1. The operator submits a signed, revised Plan that incorporates all of the requirements, design features, mitigations, and monitoring items outlined in the NEPA decision document that were determined necessary to minimize adverse impacts on surface resources and ensure compliance with applicable surface resource laws, regulation, and policy. 2. The operator provides a reclamation bond, which is a guarantee of faithful performance with the terms and conditions outlined in the final Plan, including the requirements of the NEPA decision document. The bond amount is the FS’s estimated cost for the government to complete site reclamation in the event that the operator cannot or will not perform the required reclamation described in the associated reclamation plan. 3. If the appropriate Clean Water Act (CWA) regulatory agency (i.e. EPA and/or State) determines that CWA Section 401 certification is necessary, the operator must provide a copy to the FS (per FSM 2817.23a) prior to final Plan approval. A waiver to this requirement from the designated regulatory agency may also satisfy this requirement in certain situations. Once these three criteria have been met, the FS can approve the mineral Plan. However, prior to the commencement of operations, the operator must obtain all other necessary permits. The FS permitting processes does not negate or supersede other state or federal permitting processes and/or requirements. Operators must obtain other permits and comply with all other federal, state, and local laws and regulations as part of prospecting, exploration, development, mining, and/or reclamation activities of any mineral resource. The additional permits are described below in Section 3.1.5. The timeframe to process a Plan depends on a number of factors including the proponent’s response time for submitting a complete Plan and the NEPA timeframe. Overall, this process can range from one to seven (or more) years depending on the complexity and numerous other variables. A significant amount of the Plan permitting timeframe is a result of the NEPA process (Section 3.1.4) 3.1.3 Valid Existing Rights FS approval of a mineral Plan does not constitute recognition or certification of the validity of any mining claim to which it may relate or to the mineral character of the land on which it lies. A validity determination is a separate process when the FS conducts a mineral examination in accordance with direction provided in BLM Manuals 3060 and 3891 and BLM Handbooks H-3890-1 and H-3890-3. The FS does not have regulation and/or policy regarding VER determinations on segregated lands. Therefore, the agency practice is to be consistent with BLM regulations at 43 C.F.R. 3809.100, which state that agency decision makers have discretion to require a validity determination before approving a Plan on segregated lands. However, as stated in the FSM 2803.5 and BLM Manual 3809-1, the FS must ensure that VER’s have been established prior to allowing mineral or energy activities in congressionally designated or other withdrawn areas. To constitute a “valid existing right” on a claim that would allow for mining activities in an area despite a segregation or withdrawal from the Mining Law, a mining claim must be valid as of the date of the segregation or withdrawal, whichever is earlier (in this case, November 22, 2016), and must continue to be valid from that date forward without substantial interruption until validity is determined (US v. Almgren,

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17 IBLA 295, 299-301 (1974)). A valid lode or placer claim must meet both the Prudent Person Rule and the Marketability Test. The Prudent Person Rule was first defined in Castle v. Womble, 19 LD 455 (1894), where the Secretary of the Interior held that: "Where minerals have been found and the evidence is of such a character that a person of ordinary prudence would be justified in the further expenditure of his labor and means, with a reasonable prospect of success, in developing a valuable mine, the requirements of the statute have been met." The Marketability Test was first defined by the Secretary of the Interior in Solicitor's Opinion, 54 ID 294 (1933): " ... a mineral locator or applicant, to justify his possession must show by reason of accessibility, bona fides in development, proximity to market, existence of present demand, and other factors, the deposit is of such value that it can be mined, removed, and disposed of at a profit.”. Should both of these conditions be met and the claim has been appropriately located and maintained and met all other legal and regulatory requirements, a claim can be determined to have VER. A mining claim with VER gives the claimant the right to possess and develop the mineral deposit; however, this right has to be exercised in compliance with all applicable federal and state laws, regulations, and rules. A valid lode mining claim (patented or unpatented) with parallel endlines that contains a well-defined vein or lode may have extra-lateral rights so long as it has continuous mineralized material that apexes within the claim and extends downward beyond the claim's vertical limits without major truncation. In the event of a withdrawal, extra-lateral rights (if they exist) may extend the future subsurface mining activity beyond the boundaries of patented or valid unpatented lode claims; however, surface rights do not extend beyond the vertical limits of the actual claim (30 USC 26). Therefore, surface disturbance would most likely be confined to the actual claim boundary. Mill site claims on segregated and/or withdrawn lands are also subject to valid existing rights prior to approved use. Mill sites (dependent and independent) located prior to a withdrawal must be valid both at the date of the withdrawal and must continue to be valid without substantial interruption from that date forward until validity is determined (US v. Almgren, 17 IBLA 295, 299-301 (1974)). As stated in US v. Herron, A-27414 (March, 1957), the mere intention to use land for mining or milling purposes sometime in the future is not sufficient to validate a location. Therefore, the six mill site claims within the proposed withdrawal area would need to be determined to have VER prior to authorized surface disturbance. The process for determining VER must be conducted by a certified mineral examiner (CME). The findings in the mineral examiners report would either (1) recognize that the claim(s) has VER and that the Notice or Plan should be processed, or (2) recommend initiating contest charges against the claim through the Bureau of Land Management, subject to their technical approval of the report. Assuming a CME is available (whether FS, BLM, or contracted), the VER process typically takes between two to four years (or longer) to complete depending on many factors including number, size, and types of mining claims involved, the mineral commodities in review, the topography, and competing workload (US BLM, 2016). Consequently, the cost to the agency to complete a mineral examination report typically is a minimum of $125,000 and can be much higher given a variability of factors (US BLM, 2016). 3.1.4 NEPA Process After a complete mineral Plan of Operations is received, the environmental analysis is prepared in accordance with the National Environmental Policy Act (NEPA) requirements. The purpose of NEPA is to ensure that public input and environmental factors are assessed, considered, and disclosed in the decision making process. Depending on the anticipated impacts of the proposal, this analysis could be documented in either a categorical exclusion (CE), an environmental assessment (EA), or an environmental impact statement (EIS). NEPA regulations provide for public involvement and comment throughout the process. The time period for each public process is dependent on the issues and public interest in the operation along with the level of analysis required; however, the time period for each public involvement process (scoping, comment, and objection) is typically 30-45 calendar days. Public meetings for scoping and/or comment are conducted as

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deemed appropriate by the FS responsible official. The FS considers the public comments when conducting the analysis, determining mitigation requirements, and disclosing impacts. Overall, the typical duration for completing the NEPA on a proposed mineral Plan can take up to a year for CE’s or can expand into multiple years for more complex proposals (often one to two years for EA’s, and two to seven (or more) years for EIS’s). This NEPA process is a significant factor in the overall timeframe for permitting a mineral Plan. The FS has limited budgets and an inability to require cost-recovery for NEPA analysis; however, a project proponent has options to voluntarily contribute funding towards the analysis, which can assist in a more timely completion of the NEPA analysis. 3.1.5 Other Agency Requirements In addition to the FS permitting requirements discussed above, mining activities are subject to comply with other applicable Federal, State, or local authorities and requirements. Potential Plans within the proposed withdrawal area would be subject to a number of Montana State laws that regulate and require permits for mining activities including, but not limited to, the Montana Metal Mine Mining Reclamation Act (MMRA), Montana Water Use Act, Montana Dam Safety Act, Montana Environmental Policy Act (MEPA), and more. These other permitting processes typically occur on a separate, yet concurrent track from the FS process to approve a mineral Plan. The Montana Department of Environmental Quality (MDEQ) is the state permitting authority for locatable (hardrock and open-cut) mining in Montana. MDEQ’s responsibilities originate from several acts and their implementing regulations include the Administrative Rules of Montana (ARM) 17.24.102. MDEQ is responsible for issuing exploration licenses and approving mining Plans and amendments under the MMRA, with the purpose to prevent land and surface water degradation by requiring lands disturbed by mining to be stabilized and reclaimed. MDEQ is also responsible for protecting water quality and quantity under the Montana Water Quality Act and other statutes. MDEQ administers several sections of the Federal Clean Water Act pursuant to an agreement between the State of Montana and the U.S. Environmental Protection Agency (EPA). The State of Montana, through MDEQ, has been delegated authority for administering nonpoint source pollution prevention programs, the National Pollutant Discharge Elimination System program, and the Water Quality Standards. Furthermore, MDEQ is also responsible for protecting air quality under the Clean Air Act of Montana. Additional permits and approvals may be required for mining operations within the proposed withdrawal area, including the following (note: this is not an all-inclusive list): • Endangered Species Act (ESA) consultation with U.S. Fish and Wildlife Service • National Historic Preservation Act consultation with Montana State Historic Preservation Office • Clean Water Act (CWA) Section 404 permit from U.S. Army Corps of Engineers • CWA Section 401 certification and 402 permit from MDEQ • Safe Drinking Water Act approval for Underground Injection Control Wells from EPA • Storm Water Pollution Prevention Plan from MDEQ • Stream Protection Act 124 Permit from Montana Department of Fish, Wildlife, and Parks • Beneficial Water Use permits from Montana Department of Natural Resources and Conservation (MDNRC), including permit requirements for groundwater use in the Yellowstone controlled groundwater area near the Crevice area. • Air Quality Permit from the MDEQ In 1998, the State of Montana passed a statue (MCA 82-4-390) that prohibited cyanide heap and vat leach open-pit gold and silver mining at any new facilities not currently operating under permit. However, MCA 82-4-390 allows for pre-1998 permitted facilities to continue to utilize cyanide solution processing of ores both from the associated mine and from contracted sources. One example where this occurs is at the Golden

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Sunlight Mine (Whitehall, MT) as they have processed material for several other mining operations. Cyanide solution is the most commonly used hydrometallurgical process for the extraction of gold and silver, and depending on the mineralogy of the deposit, may also be the most economically viable option for processing. The FS works cooperatively with the MDEQ, as outlined in a 1989 Memorandum of Understanding (MOU) between the State of Montana and the FS. This MOU provides for preparation of joint environmental analyses and sharing of information, personnel, and funds for all Plans required by the FS that are reviewed and approved in coordination with the MDEQ. Once an operator submits a Plan/application, the FS and MDEQ would coordinate staffing needs and agency roles for the review and approval. Both the FS and MDEQ are responsible for establishing reclamation bonds on NFS lands in Montana as required by 36 CFR 228 Subpart A and the MMRA. Reclamation bonds are set by the agencies, are held jointly, and can be used by either agency per their regulations. The bond is jointly determined by computing costs to the FS and MDEQ for reclaiming a site should the operator default. The FS may require additional bond if it decides the joint bond is insufficient. 3.2 Assumptions and Uncertainties In preparing the RFD, there are a number of variables and uncertainties considered in the formulation of the baseline condition and parameters for analysis. The combination of these variables make developing the reasonable foreseeable development scenarios a challenge. Therefore, this report relies upon several assumptions detailed below. 3.2.1 Legislative Changes There are several areas of legislative change that may affect how the locatable mineral resources on NFS lands in the proposed withdrawal area are developed in the future. The first and most relevant to this proposed administrative withdrawal is a proposed bill (S.941 - Yellowstone Gateway Protection Act) that was introduced to the US Senate on April, 2017 by Senator Tester from Montana. This bill proposes to permanently withdraw from mining and mineral leasing laws, subject to VER, the ~30,000 acres of subject lands in the CGNF. If this bill were to be passed, it would have a very similar effects as the Proposed Action, but in perpetuity barring future Congressional action. In addition, under S.941 the subject lands would be withdrawn from appropriation under the U.S. leasing laws, which were not included in the proposed administrative withdrawal because the agency has discretion in whether to permit leasable minerals. A second possible legislative change is the ongoing effort over the past 20+ years to amend, repeal, or reform the Mining Law of 1872. Currently, there is no proposal in front of congress for consideration; however, if the effort is successful during the 20 year term of the proposed withdrawal, it could result in a range of possibilities from remaining similar to it currently is to the other extreme of a complete restructuring into a royalty system similar to what is currently used for coal, oil, and gas. The effect of major changes in the Mining Law on mineral activity in the proposed withdrawal area, while uncertain, would likely be a decrease in the amount of exploration activity and mine development, at least in the short term, as operators adjust to the new requirements. A more extensive effect of potential legislative change would be a decrease in the number and size of mines that could be developed if a royalty on mineral production created a corresponding increase in operating costs, consequently raising the cut-off ore grade. For purposes of this analysis, it is assumed that the Mining Laws would not be significantly changed, the right of self-initiation would be maintained, and there would be no federal royalty system imposed. In addition to proposed changed in the General Mining Law, federal and state agency regulations can change over time. However, for purposes of this report it is assumed that any regulation and/or policy changes would be minimal and not significantly affect the development of potential mineral resources.

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A third possible change could be in regards to taxes on mining property and production revenue. If taxes are increased either by the federal and/or state governments, this could also have an effect on the viability of individual operations, similar to those described above. In this analysis, it is assumed that there would be no significant deviations to the current tax levels. Changes in environmental permitting is a fourth possible legislative change could also have a substantial effect on the viability of individual operations. Politics and changes in administration (executive and legislative branches) will likely result in emphasis shifts between increasing environmental protections to promotion of mineral and energy development and streamlining of the permitting process. These changes could occur through modifications to federal laws like the Clean Air Act (CAA), the CWA, the ESA, and/or any other regulatory agency’s regulations and policy (i.e. MDEQ, MDNRC). However, these political shifts are expected to balance out over the next 20 year term of the proposed withdrawal period and not significantly affect this forecast. Independent of the political shifts described, there has been an increasing level of public awareness and opinion regarding environmental matters and mining, which is expected to continue into the future. Therefore, prevailing public attitude may result in stricter mine permitting requirements for state and federal agencies in the future. Consequently, the effect of more stringent requirements could be increased costs of mine permitting and operations. This potential increase could cause some marginal operations to become uneconomic with less exploration and development occurring. For this development scenario, no major changes to the present regulatory framework are assumed or anticipated. Overall, for purposes of this RFD, it is assumed that none of these potential legislative changes would have an appreciable effect on the level or amount of mineral activities within the proposed withdrawal area. Anything contrary to this would be speculative at this time. 3.2.2 Technology With the easily accessible, higher grade deposits already extracted, mining companies are turning to innovation and new technology. Over the years, technological developments have made it possible to mine deposits with lower grades and more complex mineralogy without increasing costs (ICMM, 2012). Continued advances in technology are expected to have a substantial effect on future mineral exploration and development success. Improvements in technology, coupled with additional mining experience, can decrease costs, partially offsetting declines in commodity markets, and/or allow for lower cutoff grades when identifying potential ore deposits. With respect to mineral exploration activities, advances in geophysical and geochemical survey methods, tools, and procedures will continue as more and better equipment is made available. The effect of these technological advances will be a more accurate and rapid evaluation of regional and local areas, with better discrimination of target areas and a more accurate assessment of a deposit’s potential. Along with the exploration and data collection, analysis and geologic modeling methods will become more sophisticated and available to the average user. This will also advance accuracy and speed when assessing a mineral deposits potential. Mining efficiency, mineral processing, waste disposal, and water management and treatment will also continue to improve in the future as general technology advances. More knowledge from these advancements will continue to be gained through experience and research by industry and government agencies. Furthermore, advancements in environmental science, including alternative mining and processing methods, could open up greater potential for development. Similarly, reclamation science has been steadily advancing and will continue to do so into the future. More detailed design efforts will continue to be placed on reclamation of mined lands, resulting in an overall increase in reclamation costs. However, these costs should pay dividends in the long term with increased reclamation success. Eventually, as the rate of reclamation success further improves by decreasing environmental impacts of mining, the potential for development should increase.

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3.2.3 Commodities of Interest A mineral deposit is a mass of naturally occurring mineral material of sufficient size and quality that it might, under the most favorable of circumstances, be considered to have potential for economic development (Bates and Jackson, 1984; Day et al., 2016). With consideration to the geologic setting and past mineral development within the proposed withdrawal area, this RFD addresses the most likely major locatable mineral deposits of interest including gold (placer and lode), copper, molybdenum, and silver (Section 4; reference #MPR). Other mineral commodities that may be of interest in the future in this area include lead, zinc, tungsten, and arsenic. 3.2.4 Markets and Trends The economics of mining are driven by the relationship between commodity production costs and market price. Specific to this project area, the relatively high unit value of gold and other metal commodities will be critical in establishing the economic viability of mining. While production costs can be controlled or anticipated through management and technology, the significant unknown factor will be the market commodity price. The overall profitability of an operation, and hence the level of activity at the mineral prospecting, exploration, and development phases of an ore body will be closely related to the commodity price. Therefore, the commodity prices largely drive mineral exploration and mine development. The supply and demand for various commodities, and ultimately the price, is determined by several factors. On the supply side, production costs must be lower than commodity price for companies to earn a profit. To date, many of the readily accessible high-grade deposits have been mined. However, relatively lower- grade deposits that were once uneconomical to mine, have become profitable resources to develop due to the emergence of new production techniques and increases in market prices as described above. This trend has occurred for both open-pit mines and underground mines. Thus, the supply of the listed commodities of interest is steady to increasing while the efficiencies and relative cost of production has generally declined (USGS, 2017). Factors influencing the demand for precious and base metals, both nationally and internationally, include the growth of disposable income, inflationary expectations, international stock market activity, the value of the US dollar relative to other currencies, and political events. At this time, there continues to be a demand for the commodities of interest listed above, with the exception of arsenic as it has had a decrease in demand over the past few decades due to changes in environmental regulations (USGS, 2017). 3.3 Summary of Considerations To help assess the reasonably foreseeable environmental impacts of the proposed withdrawal and the alternatives, this RFD makes predictions about mineral potential and future mineral development. The RFD was prepared as an estimation based on past events, currently available data, and a series of assumptions including future regulatory, legal, economic, and technological conditions as listed throughout Section 3. Following is a summary of the assumptions used in this RFD: 3.3.1 Permitting and Legislative Changes - This RFD looks out 20 years, which is the duration of the proposed withdrawal. Estimating further into the future would be even more speculative and would only make the projections less reliable. - Proposed mining operations would be scrutinized more thoroughly by the public through the permitting process. While the mineral Plan review and approval process would continue to receive greater public scrutiny and legal challenge, operators would still be able to obtain the necessary approvals subject to compliance with applicable laws and regulations. However, the timeframe for obtaining a permit could increase beyond what was stated and assumed in this report, in part, due to the extra level of effort by the FS in responding to public comments and concerns.

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- Compliance requirements would likely be subjected to higher standards in this proposed area due to its proximity to Yellowstone National Park (YNP) and the Absaroka-Beartooth Wilderness Area (designated by Congress in 1978). One example of a higher standard related to the proximity to YNP is Montana’s designated Yellowstone Controlled Groundwater Area, which could affect water availability to support mining activities in the project area. (http://dnrc.mt.gov/divisions/ water/water- rights/controlled-ground-water-areas/usnps-montana-compact-yellowstone). - The estimated timeframe for a typical mineral Plan approval is approximately one to seven years, depending on the type of operation and the level of NEPA required. However, this does not incorporate any part of the administrative process to determine VER as is required before authorizing surface disturbing activities on withdrawn NFS lands. The VER process (two to four years) could significantly lengthen the planning/permitting time frame for mining operations under the proposed action, and represents a factor of uncertainty in the mine life cycle used for this RFD analysis. - The information in this RFD does not presume or supersede any determination of VER through the normal administrative process, which occurs independent of the analysis. - Any lode claims with asserted extra-lateral rights or determined to have extra-lateral rights would not significantly extend surface mining activity beyond the boundaries of patented claims or any unpatented claims with VER. - In regards to the FS permitting process, this RFD assumes that the proponent would have obtained legal access across roads and private property to their proposed activities on NFS lands prior to submitting their mining Plan. - This RFD assumes that the proponent would have obtained necessary permits for beneficial water use and/or water disposal and discharge prior to or concurrent with the FS permitting process. - With the exception of the proposed Yellowstone Gateway Protection Act, no other major changes to the mining laws, environmental laws, regulations or policy are being considered. If the proposed Act were to pass, this proposed action for the administrative withdrawal would not be necessary as the congressional withdrawal would be in place. - No major changes in royalty or tax systems are being considered. - The Montana statute for the ban on cyanide in mineral processing could impact the feasibility along with the mine design for processing of future mineral deposits containing low concentrations of gold and/or silver. However, this ban is specific to open-pit mines and the scenarios used in this RFD are all underground mine models (see Sections 3.3.3 and 4.3). Therefore, the RFD assumes that this Montana statute would not significantly affect the permitting of any proposal. 3.3.2 Commodities and Markets - How and when minerals were mined and exploration projects were completed in the past was based in large part on the price of the target commodity being mined. Past economic conditions included significant swings in commodity prices, which created swings in the development of exploration projects and mines. These variations suggests that it would not be useful to base an analysis on a fixed estimate of future commodity prices. - This RFD considers past events as a prediction of future development under the assumption that future swings in commodity prices would be similar to past swings over a similar timeframe. Therefore, fluctuations in commodity prices would generate the same net effect to mineral development over the future 20 year timeframe as they did over the past 20 year timeframe. - Long-term domestic production of minerals and the proportion coming from Federal lands would remain stable and consistent with the trends over the past 20 years.

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- Prices for energy (i.e. fuel, electricity) and labor resources are assumed to remain on the same general trend as they have for the past 20 years. This analysis is not anticipating any significant increases or decreases to these markets. 3.3.3 Past Insights for Future Mining - Mineral activity, including mine development and exploration projects, that occurred over the past 20 years were used as the primary basis for estimating the baseline number and size of mineral development projects that could potentially occur in the proposed 20 year withdrawal period. - The location of past mineral activity is fundamentally based on the existence of mineral deposits and the likelihood of those lands to yield minerals in economically viable quantities. This remains true for the future, so the general geographic location of future projects was estimated using mapped mineral potential in conjunction with past project locations. Therefore, the geographic distribution of mineral activity would remain similar along with the general size of the operation. For example, gold would continue to be mined in the same regions where gold development occurred in the past. - Mineral exploration is based on the premise that an eventual discovery would result in a mine that makes the effort worthwhile. In general, out of several hundred favorable sites that have mineralization, only one would eventually lead to development and production of ore. If indications are strong enough for detailed surface investigation, the odds are 1 in 100; if a site is attractive enough to drill, the odds are 1 in 50; after ore mineralization has been verified, the odds are 1 in 10 of finding an orebody (Peters, 1987). These statistics are taken into account in this report to illustrate the relative probabilities for the future mineral activity that could occur within the study area. - This RFD does not take into account new discoveries in areas previously thought to contain little or no mineral potential. Predicting these new discoveries is too speculative and not attempted here. - Relating deposit types to commodities adds complexity to the analysis as one deposit type may contain many commodities. “Most mineral commodities occur in a variety of different types of mineral deposits. Gold, for example, occurs in surficial concentrations as placer deposits, in some volcanic environments as epithermal vein deposits, in metamorphic terrains as orogenic gold deposits, and as a coproduct in porphyry copper deposits that form in shallowly emplaced igneous intrusions” (Day et al., 2016). Conversely, a polymetallic vein may contain silver, gold, lead, copper, zinc, antimony, molybdenum, and/or barium in varying quantities. An individual tract may contain more or less of these elements and the probability of mining the deposit would depend on the commodity prices, ore grades, and other project-specific factors. As a result, commodities are the focus of this report as opposed to mineral deposit models. - Underground mining methods are considered to be the only feasible type of mining method that would occur in the project area due to the nature of the known mineral deposits, the steepness of the terrain (in particular, in Emigrant), Montana’s cyanide ban with open-pit mines, potential complications with meeting final reclamation objectives, and the likely extended timeframes with permitting an open-pit mine as they tend to have larger surface disturbance footprints. To conclude the assumptions summary, this RFD analysis was prepared to support the assessment of the reasonably foreseeable environmental, economic, and social impacts of the No Action as well as the Proposed Action (proposed withdrawal). The assumptions developed were necessary and broad due to the diversity of locatable minerals on subject lands, variety of mining and exploration methods, geographic scope, inherent uncertainty of the commodities markets, and the principle of self-initiation under the Mining Law. The importance of this RFD is not the exact estimated number of future mines but, rather, the relative levels of estimated future mining-related activity across the alternatives. It is acknowledged that changes in geologic ideas, technology, market conditions, and geopolitical climate may, in reality, create very different future outcomes; however, at this time, those changes cannot be predicted sufficiently to utilize them to generate quantitative analyses.

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4 Mineral Activity Most of the mineral resources of the Custer Gallatin National Forest are found within the Absaroka- Beartooth Study Area (ABSA), which is approximately two-thirds designated wilderness area. The ABSA is a tract of approximately 1.4 million acres of primarily NFS land in south central Montana adjacent to the northern part of Yellowstone National Park (Hammarstrom et al., 1993). This area was defined by the USGS in numerous reports that have been generated since the 1970’s in conjunction with wilderness studies and mineral assessments in this region. The ABSA encompasses 16 historic mining districts (Map 4) with mines that have operated since the 1860's. The ABSA mines have produced gold, silver, copper, molybdenum, lead, arsenic, and zinc resources in addition to essentially all of the identified resources of platinum-group elements (platinum, palladium, rhodium, ruthenium, osmium, and iridium) and 75 percent of the identified chromium resources in the U.S. (Hammarstrom et al., 1993). Encompassed within the ABSA is the Emigrant Crevice proposed withdrawal area, which contains five of the 16 historic mining districts - Emigrant, Mill Creek, Six Mile, Crevice, and Jardine. The proposed withdrawal area has a long history of mineral prospecting, exploration, development, and production as discussed below. There are hundreds to thousands of abandoned mine land features (adits, shafts, mill sites, dumps, etc.) scattered throughout this area, indicating a long history of mining in these historic mineral districts. This section discusses the mining activity (past, present, and possible future) within the proposed withdrawal area. This information is presented for each parcel: Emigrant to the north (~15,808 acres of NFS lands), and Crevice to the south (~14,794 acres of NFS lands) for each alternative. 4.1 Past Mineral Activity For purposes of this RFD, past mineral activity includes any mining activity older than 20 years (pre-1997), including the historic mining. Activity within the past 20 years is disclosed under Current Mineral Activity in Section 4.2. The past information is provided as background information to give perspective into the forecast of potential future activities in Section 4.3. 4.1.1 Emigrant The Emigrant proposed withdrawal area (Maps 1 and 4) is located 26 miles south of Livingston MT adjacent to the Absaroka-Beartooth Wilderness and includes the Emigrant Creek drainage and parts of the Mill Creek and Sixmile Creek drainages. Numerous reports on the geology and mineral resources for this area have been published since the mid-1900’s. These reports often refer to deposits and resources within the Emigrant Mining District, also known as the Chico, Curry, and/or Shorthill, in addition to resources and historic mineral operations in portions of the Mill Creek and Six Mile Mining Districts. The USGS includes the Emigrant District in a database compilation of “the world's largest and most important porphyry-related deposits” (USGS, 1999). The Emigrant Mining District is centered on one of multiple intrusive centers located on the Cooke City Structural Zone at its intersection with the Mill Creek Fault. This intersection is the locus for the emplacement of the Emigrant Stock and a number of satellite bodies. Overall, the large stock intrusion tends to have a zoned mineral distribution with a core of molybdenum with minor copper, a zone of copper- gold, and an outer zone of copper-silver-base metals (USGS, 1983). The mineralization within the district occurs as sulfide disseminations, breccia pipes, stockworks, and veins containing the following minerals: gold, silver, copper, molybdenum, lead, zinc, arsenic, and tungsten. Bog iron deposits containing manganese also occur in the Emigrant and Mill Creek Districts; however, the deposits appear to be too low grade and too small to support a conventional large-scale mining operation so will not be discussed further in this RFD (USGS, 1983).

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Placer gold was first discovered in Emigrant Creek in 1863. Since then, this area has become known for containing the largest discovery of placer gold within the ABSA, with production in excess of four million metric tons of auriferous gravels (Hammarstrom et al., 1993). Most of the recorded mineral production in the Emigrant area occurred in the early 1900’s as gold and silver from placer deposits (Table 1). At 2017 gold prices, the ~40,000 ounces of placer gold recovered from the Emigrant area would be worth over $50 million. Early placer mining methods included ground sluicing, hydraulicking, drift mining, in addition to the largest bucket-line dredge ever operated in Montana. Table 1: Recorded production from the Emigrant Mining District (modified from Johnson et al., 1993). Emigrant Mining District Recorded Production Mineral Commodity Placer Quantity Lode Quantity Gold 39,594 oz 438 oz Silver 2,292 oz 942 oz Copper - 318 lb Lead - 954 lb Zinc - 318 lb

Since the early 1900’s, there have been several episodes of mineral exploration on public lands in the proposed Emigrant withdrawal area (i.e. the historic Emigrant, Mill Creek, and Six Mile Mining Districts), resulting in 21 patented claims. This area contains over 50 named small mines (i.e. prospects) and numerous other mineralized occurrences. Some of the past mineral activities in this area included surface and underground mapping, sampling, geophysical surveys, drilling (83 drill holes totaling ~42,237 ft. from 1971 through 1992), along with some mineral production. The exploration results have led to several mineral assessments over the years, which have indicated many potential deposits and also produced numerous mineral resource calculations. Currently, most of the mining properties previously explored (patented and unpatented) in the Emigrant area are held by (owned and/or leased) Lucky Minerals, Inc. Table 2 summarizes the chronology of mining activity in the Emigrant Mining District from initial discovery through present. Please note that this table attempts to capture the general history and may not include all mineral exploration and/or mining events. Also, this table includes activities both on private claims (i.e. St. Julian, Great Eastern) in addition to unpatented claim blocks on NFS lands (Map 2). Table 2: Summary of historic mineral activity within the Emigrant Mining District. (References include: Grosvenor, 2017; Hammarstrom et al., 1993; Johnson et al., 1993; Lucky Minerals, 2015; NewEdge, 2008; USGS, 1983, Whithorn, 2002) Emigrant District - Mining History Year Activity 1863 Placer gold discovered in Emigrant Creek. 1868 Emigrant Creek lands included in Crow Indian Reservation and closed to mineral exploration. 1869 ~5 years placer mining processed ~250,000 cubic yards material producing ~24,000 oz. of gold. 1870 - 1871 At the mouth of Emigrant Gulch struck pay-dirt and gradually opened a placer strip 400 ft. wide and nine miles long producing $8,000 in gold.

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1882 Lands in Emigrant Creek reopened to mineral exploration and numerous claims located, including the Great Eastern claim group. 1885 St. Julian claims located and lode gold discovered. Allison Tunnel exploration began for gold, silver, and copper with assay results ranging from 0.24 to 0.42 % molybdenum and averaged 0.30 %. 1895 - 1906 St. Julian claims hosted a ten-stamp mill, offices, and housing. 1901 - 1903 St. Julian Mine produced ~395 oz gold from twelve adits (~1,060 feet) and 3 shafts. 1904 Emigrant Creek placers mined using track mounted steam shovel served by 3 Dinky engines, 40 ore cars, and a track mounted wash plant. 1929 - 1932 Yellowstone Gold Mining Co. placer mined near White City along Emigrant Creek (~1 mile downstream from proposed withdrawal boundary). 1937 American Metal Climax, Inc. (AMEX) exploration in Emigrant drainage. 1939 Emigrant Creek placer mined with a dry land dredge. 1941 - 1946 Emigrant Creek placer mined intermittently with a 10 cubic feet/bucket, 110 bucket line dredge (costing $600,000) and processed ~2.5 million cubic yards (largest dredge in Montana history). 1901 - 1947 An additional 15,592 oz of gold produced from placer deposits in Emigrant drainage along with 2,592 oz of silver produced for a total value of $536,192. Most of the production occurred prior to 1900 before records were kept by US Bureau of Mines. 1943 Allison Tunnel sampled by USGS and Kerns with assays ranging from 0.17 to 1.10 % molybdenum and a weighted average of 0.6 %. 1963 AMEX explored and drilled 2 holes for molybdenum in the Emigrant drainage. 1966 - 1969 Minerals Exploration, Inc. sampled and drilled for molybdenum at the Allison Tunnel. 1970 Basic Metals, Inc. drilled ~15 holes for copper and molybdenum in the Great Eastern claim block, which contains 4 adits (~300 ft.) and a 50 ft. deep shaft. 1971 - 1973 Duval Corp. drilled 10 holes in Emigrant (near DUV and St. Julian claims) looking for Cu-Mo-Au. Duval also conducted ~4 miles of induced polarization geophysical surveys. 1973 US Bureau of Mines samples the Emigrant area, including the Allison Tunnel with assays > 0.1 % molybdenum. 1975 Duval Corp. entered joint venture with Gulf Mineral Resources and drilled 1 hole. 1978 Absaroka-Beartooth Wilderness designated by Congress (PL 95-249). This wilderness area was later modified in 1983 by PL 98-140 and again in 1984 by PL 98- 550. The wilderness area as designated and modified did not include the Emigrant or Crevice Mining Districts. 1980 Bear Creek Mining Co. (subsidiary of Kennecott Copper) conducted exploration for copper and molybdenum. 1982 US Geological Survey (USGS) collected dozens of samples from the Emigrant area (i.e. Great Eastern, Great Western, Peter Pear). Sample results showed higher levels of silver, copper, lead, zinc, gold, and molybdenum (see USGS, 1983 for more details).

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1983 USGS report stated: - The Emigrant-Mill Creek area contains an estimated 1.7 million tons of indicated and inferred silver, gold, lead, zinc, and copper resources in 13 vein deposits. - The valleys of Emigrant and Sixmile Creeks may contain significant amounts of gold-bearing gravels. - The Emigrant-Mill Creek area has a high potential for undiscovered copper and molybdenum resources, and a moderate potential for undiscovered gold, silver, lead, and zinc resources. 1987 Montana Mining and Reclamation (MM&R) began testing placer deposits in Emigrant Creek. 1988 - 1990 Sandhurst Mining NL entered joint venture with MM&R to map and sample (soil and chip) both lode and placer gold deposits in Emigrant Creek (St. Julian, Huckleberry Gulch, Emigrant Peak, and DUV). 1990 Kennecott obtained option from MM&R and helicopter drilled 6 holes on DUV claims. 1991 Harrison Wester Environmental Services, Inc. completed 10 sonic drill holes for placer gold in Emigrant drainage. 1991 - 1993 Pegasus Gold Inc. conducts gold exploration on DUV, Allison, and St. Julian claims including drilling 26 core-holes, 24 reverse circulation holes, and widespread rock chip sampling (>2,500 samples). Analysis of the drill results indicates potential for a thick zone grading 1 to 2 g/t gold and 0.10 to 0.3 % copper. 2007 NewEdge Gold Corp. acquired leases on properties, but dropped in 2008 due to market collapse. 2008 NewEdge Gold contracted Tetra Tech to complete a Canadian National Instrument (NI) 43-101 inferred resource estimate for DUV deposit based on data from Duval (1971-1972), Kennecott Copper (1990), and Pegasus Gold (1991-1992). Results of inferred mineral resource calculations using a cut-off of 0.01 oz/t gold were 1,646,000 tons at a grade of 0.0286 oz/t gold that would contain ~ 47,000 oz of gold with additional silver and copper credits and anomalous molybdenum mineralization. 2008 Atlas Molycorp located several claims in East Fk Emigrant Creek near DUV inholding. 2010 - 2011 Iron Cap Mining LLC formed with past members of MM&R. They were approved by the FS for 1 year of mineral exploration of placer gravels in the East Fork of Emigrant Creek, which was subsequently implemented and reclaimed. 2012 Bill Ogg, claimant of record for MM&R, submitted to the FS a Plan for placer exploration in the East Fork of Emigrant Creek. The NEPA analysis was completed but the operator never implemented the Plan. 2013 Advanced Resource Technologies conducted placer operations in the lower Emigrant Creek area near Old Chico on private lands outside the proposed withdrawal area.

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2014 Lucky Mineral Inc. began acquiring and staking claims in the Emigrant area. In total, Lucky has lease/option agreements on 8 unpatented claims, 9 patented claims, and has staked a total of 117 claims covering a total of ~2,560 acres. 2015 Lucky Minerals Inc. filed a mineral exploration Plan to Montana DEQ and the FS to conduct drilling in search of copper, gold, silver, and molybdenum. In 2016, Lucky withdrew the Plan with the FS, but is moving forward with the DEQ permit for mineral exploration on the patented St. Julian and DUV claims.

2011 - 2016 Several mining Notice of Intents were received by the FS for small-scale placer prospecting and exploration activities in Emigrant Gulch. 2017 Lucky Minerals exploratory drilling Plan was approved by MDEQ on patented mining claims within the Emigrant District. To date, implementation has not begun. 2017 Lucky Minerals obtains a road use permit to access and maintain roads to private land for exploration activities proposed during the summer of 2018.

4.1.2 Crevice The Crevice proposed withdrawal area (Maps 1 and 4) encompasses the Crevice Mining District and the Jardine Mining District, which have also been referred to as the “Bear Gulch District” or “Sheepeater District”. The proposed Crevice withdrawal area is located south of the Emigrant District and east-northeast of Gardiner, Montana. This area lies in the Bear Creek drainage, is adjacent to the northern boundary of Yellowstone National Park, and is bounded on the north and east by the Absaroka-Beartooth Wilderness. The land status in this parcel is complex, including split estate with private minerals and NFS managed federal surface estates, power site withdrawals, Federal Game Refuge withdrawals, and dozens of patented claims (reference #lands report). This district is separated into two structurally distinct, mineralized blocks: Mineral Hill (Jardine) and Crevice Mountain. The mineralization within the district occurs primarily as either replacement veins (up to 4 ft. in width) or as remobilized concentrations within the banded iron formations (CMG, 2016; Johnson et al., 1993). The area hosts the following minerals in order of decreasing abundance: gold, arsenic, tungsten, silver, copper, and lead (Wedow et al., 1975). Much of the known mineralization occurs on patented claims; however, additional mineral anomalies on public lands have been identified from exploration work conducted by TVX, Homestake, and Inco in the “Tower Grove,” “Buffalo Mountain,” and “West Buffalo Mountain” areas surrounding Crevice Mountain (MDEQ, 2017; CMG 2016) (Map 3). Placer gold was first discovered in 1862 and the discovery of gold-bearing quartz deposits followed shortly after. However, the area was not actively developed unit the 1880’s due to its inclusion in the Crow Reservation. Since then, there have been 80 mining claims patented, hundreds to thousands of mine prospects explored (mostly lode deposits), along with mineral development and production in the Crevice- Jardine area. One of the limiting factors for mining development and processing in this area has been the lack of water (CMG, 2016; Grosvenor, 2017; Johnson et al., 1993). Table 3 summarizes the chronology of mineral exploration and mining activity in the Crevice-Jardine area from initial discovery through present. Please note that this table attempts to capture the general history and may not include all mining events. Also, this table includes activities both on patented claims (i.e. Mineral Hill) in addition to unpatented claim blocks on NFS lands (Map 3).

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Table 3: Summary of historic mineral activity within the Crevice - Jardine Mining District. (References include: Grosvenor, 2017; Hammarstrom et al., 1993; Johnson et al., 1993; MDEQ, 2017; Seager, 1944; USGS, 1983; Wedow et al., 1975)

Crevice and Jardine Districts - Mining History

Year Activity 1862 Placer gold discovered in Jardine-Crevice area. Eaton mill (5-stamp with saw mill) constructed. Operated from 1864-1866 and again 1864 1890-1893 (then upgraded to 20-stamp mill). 1870 Gold-quartz veins discovered on Mineral Hill near Jardine. 1879 Gold discovery at the Highland Chief near Crevice Mountain. Eaton erected a 5 stamp mill and sawmill along Bear Creek. In 1890, a 5 stamp 1884 addition was made to the mill. Crevice Mountain's Conrad property constructed a 10-stamp mill (later enlarged to 20 1891 - 1908 stamp mill) on Highland Creek and produced ~6,763 oz of gold from 1898-1908. Mine was then shut down due to difficult access and inadequate water supply. 1892 Park View Mining Co. organized to develop the Tower Grave and Snowshoe Mines. 20 stamp mill was built near Palmer Creek. This mill only operated a short time due 1894 to inadequate flow of water in Palmer Creek. 1899 Jardine mill built and produced gold, tungsten, and arsenic. 1901 - 1947 Crevice Mountain area mines produced 2,800 oz of gold and 500 oz of silver. Jardine District production included >201,000 oz gold, 12.6 million lb arsenic trioxide, 1901 - 1949 766,122 lb tungsten, 36,000 oz silver, and small amounts of copper and lead. This district was the largest producer of gold in the area. 40 stamp Revenue mill and a 150-ton cyanide plant erected in Bear Gulch along with 1903 a hydro-electric plant. 1903 - 1947 Jardine District placer gold production through hydraulic mining was 407 ounces. McClauney was a productive gold mine in the Crevice Mountain area and also 1911 produced small volume of scheelite, which contains tungsten. Arsenic mill built in Jardine extracting arsenic from arseopyrite ore. The plant operated almost continuously from 1923 - 1926 and again from 1932 - 1936. The plant 1923 - 1945 closed in 1942 due to war-time restrictions. However, the continued need for arsenic resulted in a Federal government contract to rehabilitate the plant and install new equipment to operate from 1944-1945. Herman-type pebble mill was installed and processed 800 tons or ore producing 0.21 1931 opt for a total of 168 oz of gold in 1932. Montana Vindicator Gold Company recovered 43 oz. of gold and 15 oz. of silver from 1934 - 1937 the Medona Mine. They also produced and sold $2500 worth of scheelite (mineral containing tungsten). 1934 - 1939 Snowshoe Mine produced 718 oz of gold at the floatation mill.

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First Chance mine had a small mill (~87 tons of ore processed), but only operated for 1938 a year or so. Fire destroyed the cyanide plant and consequently, the Jardine Mill and Mine closed 1948 after having produced almost $5 million in gold (primary ore), arsenic, tungsten, silver, copper, and lead. Various mining companies conducted extensive exploration and drilling programs in 1970's the Jardine area. The successes of those exploration efforts led to the development of the Mineral Hill Mine. Anaconda Company conducted exploration in Jardine District included core drilling, 1970's aeromagnetic surveys, and geochemical sampling over the area between the Jardine Mine and Crevice Mountain as well as west and northwest of the Jardine Mine. 1973 Anaconda Company drill 14 holes (~9,916 ft.) in Crevice Mt and Tower Grove areas. Inco-Homestake joint venture collected and analyzed ~4,150 surface samples (soil, rock chip, stream sediment, and vegetation). In addition to sampling, also conducted 1974 - 1979 basic reconnaissance exploration, which included geologic mapping, soil surveys, rock chip sampling, petrographic work, magnetic surveys, IP surveys, and VLF- R surveys. Geochemical surveys (1976+) conducted by the USGS found gold in the Jardine- 1976 Crevice area. Samples in Bear Creek found anomalous arsenic and tungsten in addition to gold, silver, molybdenum, lead, and copper. Homestake Mining Company acquires Jardine Mine from Anaconda Company and 1979 begins exploration with some drill holes in the Mineral Hill and Crevice Mt area. By 1983, had drill 67 holes totaling 31,062 ft. Crevice Mt area had a broad airborne magnetic survey conducted in addition to a 1980 detailed ground magnetic survey over the Conrad area. Homestake ventures with American Copper and Nickel Company (ACNC) for 1984 exploration and Mineral Hill Mine development. Jardine Joint Venture submitted an operation permit with the FEIS to follow in 1986. Mineral Hill Mine began underground operations. The vein deposits yielded ~800,000 tons of ore at a grade of 0.268 oz gold/ton producing 93,190 oz gold through 1991. 1989 - 1996 Total mine property encompasses 410 acres, of which 93 was permitted for disturbance. 1991 American Copper and Nickel Corporation/Jardine Joint Venture conducted helicopter-supported drilling for gold on the Crevasse Project in the Jardine District. 1993 TVX Gold acquires Homestake's interest in Mineral Hill Mine. 1994 TVX drilled 70 holes (48,650 ft) on Crevice Mountain proving out >215,000 oz of gold at the Conrad and Tower Grove zones. 1996 TVX drills 47 core holes (22,561 ft) and attempts to tunnel from Mineral Hill under Palmer Mountain to reach the Crevice Mountain mineralized Conrad Zone. This effort was halted after hitting unexpected groundwater, consequently shutting down the operation by 1998. This water continues to discharge into Bear Creek at up to 200 gallons per minute. 2000 Mineral Hill Mine reclamation begins.

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2002 Mineral Hill Mine reclamation complete. Water treatment ongoing into perpetuity. 2015 Crevice Mining Group (CMG) began staking unpatented claims on NFS lands and securing private claims in the Crevice area. 2015 CMG submitted a mine exploration Plan to MDEQ, which was amended July 2016. This proposal is for exploration drilling (core and reverse circulation) and development mining (decline and underground drilling) on private lands located within the proposed withdrawal boundary.

2015 CMG submits an application with the CGNF for road use to access private lands for mineral exploration. FS permit issued to CMG in 2017. 2015-2016 Few mining Notice of Intents were received by the FS for small-scale placer prospecting and exploration activities in Crevice area. 2017 Conservation easement placed on private lands at TVX/Mineral Hill Mine site within proposed withdrawal boundary.

4.2 Current Mineral Activity Both the Emigrant and Crevice parcels of the proposed withdrawal have active unpatented mining claims, patented mining claims, and also have current mineral exploration proposals and/or plans on the private lands within the boundary (Tables 2-4; Maps 2 and 3). For purposes of this RFD, current mineral activity will be considered as any mining that has occurred throughout the past 20 years (i.e. 1997-2017). This will allow for the baseline assumptions for mining activity into the future (next 20 year duration of the proposed withdrawal). As described in Table 4, the proposed Emigrant Crevice withdrawal may affect 22 claimants holding 235 unpatented mineral claims (some dating back to the 1920’s) encompassing approximately 4,858 acres of NFS lands. The BLM Master Title (MT) plats for the subject lands indicate that PL 1672 determinations were completed in 1961 and all NFS surface estates are managed by the USFS except three unpatented lode claims located in the NE part of the Emigrant area in the Arrastra Creek area (Mill Creek drainage). These three claims (Pyrite, Mystery, and Floyd Counts) were determined to have an asserted right or interest in the vegetative and other resources within the claim boundary. In addition to the unpatented claims on NFS lands, there are over 100 patented claim inholdings within the proposed withdrawal boundary (now owned by numerous entities like Lucky Minerals and Crevice Mining Group) that would likely be indirectly affected (if not directly affected) by the proposed action. Table 4 provides mining claim and site information collected from the BLM’s land records website (https://www.blm.gov/lr2000/) on October 31, 2017 in addition to information provided by the BLM’s Montana State and Butte Field Offices (personal communication). At the time of segregation (November 22, 2016) there were additional active placer and lode claims within the proposed withdrawal area; however, since that date the claims have been closed by the BLM, mostly in part to the claimants not filing each claims yearly assessment fee and/or waiver with their affidavit of assessment work.

2 Public Law (PL) 167, also known as the 1955 Multiple Surface Use Act. Following this Act, mining claimants had a period of time to file with the Secretary of the Interior for the determination of surface rights, including the vegetative surface.

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Table 4 – Current active mining claims and sites within the proposed withdrawal area (post- segregation as of October 31, 2017). Total Placer Lode Mill Claims* Total Total Withdrawal Claim Claim Site (Unpatented ) Claimants Patented Parcel Number Number Number Number (Unpatented ) Claims (acres) (acres) (acres) (acres) 3 173 0 176 Emigrant 18 21 (159 ac) (3,574 ac) (0 ac) (3,733 ac) 0 53 6 59 Crevice 4 80 (0 ac) (1,095 ac) (30 ac) (1,125 ac) 3 226 6 235 Total Area 22 101 (159 ac) (4,669 ac) (30 ac) (4,858 ac) * There were no tunnel sites located within the Emigrant and Crevice proposed withdrawal areas. Although locating a mining claim is not required for mineral exploration and development on NFS lands open to mineral entry, it is common practice to do so in order to protect one’s mineral interests. Therefore, claim location and density are factors for consideration of predicting future activities. However, using professional knowledge and an analysis of the claim information in Table 4, it is evident that the number of mining claims and sites located in the project area should not be used solely to predict the number of future mines or exploration projects that might be located and/or where potential future mineral development activity would take place. Some reasons for this unpredictability include: • Mining claims may be located based on little or no evidence of locatable mineralization and often serve as a basis for exploration projects. Consequently, many claims are never developed. • Mining claimants often locate mining claims over a much larger area than the geographic extent of the mineral deposit known at that time. This is common practice in order to make certain that no mineable resource is missed, to allow for flexibility in mine design options, and to secure the property from potential competitors. • Some lands are subject to multiple mining claim locations. This practice of locating mining claims on lands already subject to existing mining claims allows a subsequent “junior” locator to assert rights to a mineral deposit if the original “senior” mining claimant abandons or forfeits the mining claim. Additionally, multiple claims could be located to ensure all fractions are covered. Thus, the number of unique acres claimed might be smaller than the number of mining claims suggest. • Mining claims vary widely in size, from fractional lode claims under 5 acres to 160-acre association placer mining claims. Upon further investigation of the subject mining claims, it was noted that some of the claims within the proposed withdrawal area are not standard size. • The variable nature of commodity prices means that a mineral resource may be discovered and mining claims staked even though the commodity price would not make recovery of the mineral profitable at that time. Mining claimants may continue to hold their mining claims and pay annual maintenance fees for many years in hopes that a future commodity price increase or new technology would make them economical to develop. 4.2.1 Emigrant Following the date of the segregation (November 22, 2016), there are 176 total active unpatented mining claims belonging to 18 claimants within the Emigrant withdrawal area. These claims encompass

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approximately 3,733 acres (Table 4). Of those claims, three are association placer and the rest are lode claims. There were no mill sites or tunnel sites active according to BLM’s records (https://www.blm.gov/lr2000/, accessed October 31, 20173). To date, no VER determinations have been conducted on any of the active claims in this area. As summarized above in Table 2, there have been several mineral exploration projects and mineral interest in the Emigrant area over the past 20 years. The CGNF has worked with operators on permitting mineral exploration Plans for both placer and lode deposits. Small-scale placer prospecting in and near the drainages has also occurred on a regular basis throughout the past 20 years, typically conducted under a Notice of Intent to the FS. Most recently in 2015, Lucky Minerals Inc. submitted two separate mineral proposals in the Emigrant area: 1) A proposal to Montana DEQ for exploration on private lands (Lucky Minerals, 2015a). This proposal includes drilling at 23 locations (up to 48 core holes) on existing roads. MDEQ issued their environmental analysis (under MEPA) late July, 2017 and then sent Lucky Minerals a bond request in August. MDEQ is currently waiting on the bond collection prior to issuing the final exploration license (Lane, 2017). Lucky Minerals intends to post bond prior to their start of the 2018 field season (Ellsworth, 2017). In association with this exploration activity, Lucky Minerals obtained a road use permit from the Forest Service (October, 2017) for their mineral exploration activities to be conducted on private lands in the summer of 2018. 2) A Plan of Operations (Plan) to the CGNF for exploration activities on NFS lands (Lucky Minerals, 2015b). This proposal outlined Lucky Minerals proposal to drill at 12 locations (up to 30 core holes) using existing roads and/or former drill pads accessed via helicopter. However, later in 2015 Lucky Minerals withdrew their Plan from the FS, in part due to the lengthy approval timelines. Lucky Mineral’s proposals would explore some of the numerous highly mineralized breccia-pipes and two porphyry targets that exist within the property boundary in Emigrant Creek. These Plans outlined the company’s intent to conduct exploration drilling in search of copper, gold, silver, and molybdenum across their mineral properties. Lucky Minerals mineral estate package consist of “eight unpatented claims, nine patented claims that are under lease option, in addition to 117 unpatented staked and un-surveyed contiguous mining lode claims covering an area of approximately 2,530 acres” (Lucky Minerals, 2015c). 4.2.2 Crevice Following the date of the segregation (November 22, 2016), there were 59 total unpatented mining claims and mill sites belonging to four claimants within the Crevice withdrawal area. These claims encompass approximately 1,125 acres (Table 4). Of those claims, six are mill sites and the other 53 are lode claims. There were no placer claims or tunnel sites active according to BLM’s LR2000 records (https://www.blm.gov/lr2000/, accessed October 31, 20173). To date, no VER determinations have been conducted on any active claims in this area. As summarized in Table 3, the past 20 years of mining activity in the Crevice proposed withdrawal area has had some mineral activity on private lands, but little on NFS lands. The Mineral Hill Mine (private) was operated by TVX from 1989 – 1996 (MDEQ, 2017) and produced ~575 short tons/ day at an average grade of 0.281 ounces per ton gold with some silver (Hammarstrom et al, 1993). In 1996, TVX was constructing a tunnel from Mineral Hill under Palmer Mountain to reach the Crevice Mountain mineralized zone. However, this tunnel was halted after hitting unexpected groundwater that consequently shut down the operation by 1998. The Mineral Hill Mine was reclaimed by 2002, with the exception of an in situ evaporative tailings facility (~252,000 cubic yards) that remains on site and is operated by TVX Mineral Hill Inc. / Kinross Gold Corp. In August 2017, TVX entered into an agreement with the Rocky Mountain

3 LR2000 records search on 10/31/17 indicated some errors that the BLM State and Field Offices were able to correct for purposes of this report; however, those changes have not yet not been updated in the LR2000 system.

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Elk Foundation to set aside, in perpetuity, ~549 acres of TVX’s patented mining claims around the Mineral Hill Mine. The agreement placed the private lands into a conservation easement restricting them from future locatable mining operations. In 2015, the Crevice Mining Group (CMG) began staking unpatented claims on NFS lands and securing private claims in the Crevice Mountain area. Since then, CMG submitted two mineral proposals: 1) A proposal to Montana DEQ for exploration on 14 acres of private lands near the historic Snowshoe Mine (CMG, 2016). Their mineral exploration plan includes the following activities: core drilling of ~64,000 ft. (128 drill holes at 500 ft. each); construction of ~0.5 mile of new road; construction of ~25,700 ft. of underground decline to the targeted mineralized zone to allow for underground drilling; development of three waste rock storage areas; and a land application discharge area if needed. In 2016, MDEQ issued CMG a deficiency letter in regards to their Plan completeness and to date, MDEQ has not received the supplemental information from the company. Therefore, the processing of the exploration license is on hold pending CMG’s response (Lane, 2017). Through personal communication with CMG’s representative Mr. Werner (September 6, 2017), CMG is not currently pursuing this permit with MDEQ. Instead, CMG is progressing under MDEQ’s small miner exclusion program, which allows for mining operations up to five acres of total surface disturbance and includes mine reclamation requirements. In 2017, CMG submitted to MDEQ their small miner exclusion statement (SMES) indicating that no work had been done in 2016. They currently hold a SMES allowing them to conduct certain mining activities on private lands. 2) A Plan to the CGNF associated with the MDEQ proposal. The proposal to the CGNF was for approximately two miles of FS road use and maintenance to access private lands for mining purposes. In 2017, the CGNF issued CMG the road use permit that is associated with mining activities on private lands. CMG’s proposed exploration program is intended to determine the continuity of potential ore bodies and attempt to delineate the economic ore reserves within their property boundary in the southeastern corner of the proposed withdrawal boundary (CMG, 2016). This proposal would be a continuation of a previous gold exploration project (by TVX-Mineral Hill) to evaluate the Crevice Mountain mineralized zone through a surface drilling program, an underground diamond drilling program, and by sampling and metallurgical testing of selected mineralized rock. 4.3 Future Mineral Activity This section describes the predictions for the reasonably foreseeable future locatable mineral exploration and development for each land parcel (Emigrant and Crevice) by each alternative (No Action and Proposed Action). As previously stated, the time frame for the projection of future mineral activity is 20 years, which coincides with the duration of the proposed withdrawal (i.e. the limit of the DOI Secretary’s withdrawal authority). However, it should be noted that mineral activity of the same type and rate would likely proceed beyond the 20 year time frame. To determine the reasonably foreseeable mineral development scenario in this report, it is necessary to evaluate the potential likelihood of: 1) The occurrence of a mineral resources (i.e. presence of target minerals): the BLM Manual 3031 and 3060 states that the occurrence of a mineral resource should be qualitatively classified into categories based on a. Level of potential, which is based on favorable geologic environment, inferred geological processes, mineral occurrences, and other evidential data such as geochemistry and geophysics.

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b. Level of certainty, which is based on the amount of direct and indirect evidence to support the interpretation of the level of potential. 2) The development of a mineral resources into a mine or exploration project: the development potential is the ability to physically access and further develop or mine mineral deposits within the foreseeable future. Development potential is also tied to a number of other factors including: location; the stage of operations (i.e. exploration vs. development); the nature of the deposit (type, minerology, tonnage, grade); supply and demand of the subject commodity; commodity prices; mining and milling methods and associated costs; the regulatory scheme and associated processes; in addition to compliance with all federal, state, and local laws and regulations. This would include obtaining FS approval following completion of environmental analysis under NEPA and possible VER determinations. The determinations for the likelihood of mineral occurrence and mineral development were made for this proposed withdrawal and disclosed in the associated Mineral Potential Report (MPR) (reference #). In summary, the MPR determined that for both Emigrant and Crevice areas there is a high potential for both locatable mineral occurrence and mineral development. These determinations were used as a basis for the following development scenario. 4.3.1 Common to Emigrant and Crevice This section covers general information, primarily from literature, regarding the larger Emigrant and Crevice areas and future mineral potential and development. Specific mineral forecasts for each parcel follows this section. 4.3.1.1 No Action Under the Emigrant Crevice project’s No Action alternative, mineral development could take place throughout the study area as it has over the past century, subject to compliance with applicable laws and regulations governing mining operations. The subject lands would be re-opened to mineral entry at the end of the two year segregation period and mining claims could then be located with subsequent exploration and possible development of potential mineral resources. To date, there have been several mineral assessments conducted in the ABSA area, which overlaps with the Emigrant Crevice proposed withdrawal area. Based on this available data, along with the other public geologic and mining data, there is abundant direct and indirect evidence indicating a high potential for the occurrence of locatable mineral resources within portions of the proposed withdrawn area (reference #MPR). This potential for mineral occurrence also holds true under the Proposed Action, only the potential for development would change. The ABSA mineral assessment reports concluded that there are known and identified resources for a variety of minerals within the proposed withdrawal area, including precious metals (gold, silver) and base metals (copper, molybdenum, lead, zinc, and tungsten) (Blackman, 1994; Hammarstrom et al., 1993; USGS, 1983). Identified resources as defined in the referenced reports are those resources whose location, quality, and quantity are known or estimated from specific geologic evidence. Identified resources may be economic, marginally economic, or sub-economic and include demonstrated (measured and indicated) and inferred resources. Blackman (1994) estimated an 83.4% likelihood that at least one mine would be developed within the ABSA, and a more likely future scenario would include the development of two mines. This scenario predicts that a future mine would produce 400–500 tons of ore per day, creating employment of 200-400 workers, depending on whether open pit or underground. Considering the ABSA has ~66% of the land designated as wilderness and already withdrawn from mineral entry, it is reasonable to expect that one of the future mines predicted by Blackman (1994) would occur within the Emigrant-Crevice proposed withdrawal area. Since Blackman’s report, additional placer and lode exploration has occurred in the proposed withdrawal area indicating additional mineral resources, consequently supporting the likelihood of future mineral development and production (CMG, 2016; Lucky Minerals, 2015c; McCulloch, 1999)

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The numerous mineral assessments within the ABSA also concluded that there is a significant potential for new deposits to be discovered and developed in the future (Blackman, 1994; Hammarstrom et al., 1993; USGS, 1983). Hammarstrom et al. (1993) predicted that the amount of ore in lode gold deposits that remains to be found within the ABSA is about half of the amount that has already been discovered. It is expected that any undiscovered deposits would likely be similar to those mineral deposits that have been mined in the area as well as deposit types that are actively sought after. Undiscovered mineral resources were defined as unidentified resources or as identified mineral occurrences for which no reliable information about location, quantity, and quality is available (Blackman, 1994). In addition to deposits similar to those explored in the past, there is also potential for a deeper, copper porphyry deposit in this area (Lucky Minerals, 2015c). 4.3.1.2 Proposed Action Under the Emigrant Crevice project’s Proposed Action to withdraw the subject lands, no new mining claims and/or sites would be located. Therefore, the 235 mining claims that currently exist post mineral segregation would be the maximum number of mining claims that could be developed on those lands during the 20 year proposed withdrawal period, subject to VER. In general, these existing claims are located in two main areas near most of the patented claims: along Emigrant Creek and surrounding Crevice Mountain. In the areas that contain no active mining claims as of the segregation date (Maps 2 and 3), including any areas where existing mining claims are closed (abandoned, forfeited, or declared null and void) during the segregation or withdrawal period, there would be no future mining activities throughout the next 20 years. However, a patented claim or unpatented claim with VER may have extra-lateral rights, which could extend the future subsurface mining activity beyond the lode claim boundaries. During the two year segregation period, if mineral activities were proposed on any of the 235 existing mining claims and sites, the FS would have the discretion to require a VER determination prior to processing a mineral proposal as described in BLM’s regulations at 43 CFR 3809.100 and Handbook 2809- 1 Chapter 8.1. As stated previously, the FS currently does not have regulations or direction concerning when and if a VER determination is required prior to approval of a Plan on segregated lands. Nonetheless, it is FS practice to be consistent with the BLM regulations and direction in such instances. However, if the lands were withdrawn, a VER determination would be required prior to approval of a mineral Plan (FSM 2803.5 and BLM H-3809-1). Determining the validity of a mining claim is a complex and time-consuming legal, geological, and economic evaluation that is done on a claim-by-claim basis or for groups of claims in common ownership (Section 3.1.3). If a claim is determined to have VER, mining activities would be allowed in a similar manner as those activities under the No Action alternative. The purpose of this report is not to determine validity of any claim, because only a validity examination report completed by a certified mineral examiner can assess that situation. However, based on known mineralization in the area, the mining history and extensive drilling results, and the number of patented mining claims, it is assumed that some of the existing claims in the proposed withdrawal area would meet the criteria to establish VER. Under both alternatives, mineral activities on private lands can occur regardless of the segregation and proposed withdrawal on adjacent NFS lands. However, under the Proposed Action alternative, the ability to conduct medium to large scale operations on private lands would be limited due to the restricted footprint of the inholdings, along with a likely increase in the public scrutiny during permitting due to the lands being surrounded by withdrawn NFS lands. If private land owners hold existing claims on NFS lands (which some hold active claims) that are later determined to have VER, the mineral activities could be permitted by the FS and consequently extend off of private land. The timeframe for this scenario would likely take five to ten years depending on the complexity, in order to complete both the VER and permitting processes prior to implementation on NFS lands.

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4.3.2 Emigrant 4.3.2.1 Emigrant No Action Overall Mineral Potential: Under the No Action alternative, the Emigrant area would continue to experience ongoing mineral exploration, development, and likely future production on and/or adjacent to NFS lands. This area is highly mineralized, and it is anticipated that there would be mineral activity in the known mineralized zones in addition to geologically favorable areas not currently under location that would be re-opened to mineral location following the two year segregation period. The Emigrant area has a high potential for undiscovered porphyry copper and molybdenum resources and a moderate to high potential for undiscovered gold (placer and lode), silver, lead, and zinc resources (USGS 1983; reference #MPR). Placer Deposits: The Emigrant Creek placer gold deposit represents the largest placer deposit found within the ABSA (Hammarstrom et al., 1993), and the area has the potential for identification of additional placer gold resources. Stotelmeyer and others (in USGS, 1983) estimated that over 1.5 million metric tons of auriferous gravels remain in shallow (<20 ft) placer deposits in Emigrant Creek. It is predicted that many of the previously mined placer deposits would be reworked in the future due to advances in processing equipment for increased gold recovery, in addition to new placer deposits discovered as extensions of the known or previously worked deposits. Over the next 20 years, the Emigrant area would continue to see placer activity occurring in areas surrounding previously identified resources where many of the current mining claims are located. This area has a number of patented placer claims (i.e. private lands) that lie along most of the lower Emigrant Creek below the East Fork confluence. It is likely that there would be further mineral exploration (likely one to two projects) and development (one to two projects) on these private lands, regardless of the selected action. These mining activities would range from prospecting with hand-tools and high-bankers up to using mechanized equipment to excavate a series of trenches and pits with onsite washing of the gold bearing gravels. It is expected that these activities on private lands would occur during the summer seasons (four to six months each) throughout the next 20 years employing two to four people per operation. In regards to activities on NFS lands, it is expected that there would be one or two Notices of Intent for placer prospecting with minimal surface disturbance submitted each year. However, if suction dredging and placer mining work is proposed in riparian areas, the proposals would have to be submitted as Plans as required by the 1987 Gallatin Forest Plan. These annual small-scale placer prospecting activities would occur during the summer months along the stream channels using hand tools, metal detectors, high-bankers, and possibly suction dredges. Along with the notice-level placer activity on NFS lands, it is expected that there would be one or two placer exploration and/or development Plans in total over the next 20 years. Each Plan would involve excavation and onsite washing of gold bearing gravels, minimal road construction (<0.5 mile), and each would disturb two to four total acres of NFS lands. The placer operations would employ approximately three people per project and would be conducted over the summer field season, requiring one (maybe two) seasons to complete. It is assumed they would be analyzed under a CE or EA, taking up to two years for permitting. After sufficient data is gathered from exploration activities to support placer mine development, it is anticipated that one or two of the operations (either on private or NFS lands) would advance with a Plan for placer mining. This Plan would be similar to the exploration proposals in regards to excavation and onsite washing of placer gravels; however, the size of the excavation panels would be larger, include up to a mile of new road, and likely overlap some of the exploration disturbance, resulting in five to seven acres

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of total disturbance. These development plans would span over two to three field seasons. This size of operation could employ four to five individuals. For a summary of the placer related activities and associated information, see Table 6 in Section 5, Summary and Conclusions. Lode Deposits: In addition to the placer activities, many of the lode deposits explored in the past would also be reexamined in the future for mineralization in widespread alteration zones, multiple mineralized breccia pipes, volcanic- hosted epithermal veins, and/or potential porphyry copper (moly-gold) deposits. Much of this mineralization is centered on the Emigrant stock, with zoned mineralization that increases in size with depth. A USGS report (1983) stated that the Emigrant-Mill Creek area has high potential for the occurrence of deposits containing copper or copper-molybdenum, and a moderate potential for deposits of gold, silver, lead, and zinc. However, more recent mineral exploration in this area has focused on the delineation of deposits containing copper, gold, and molybdenum and results have suggested high potential for the occurrence of these deposits (Lucky Minerals, 2015c). The Emigrant area has been estimated to contain 1.7 million tons of indicated and inferred resources within 13 main vein deposits (USGS, 1983). They further state that several of the mineral deposits appear to have sufficient tonnage and grade to be paramarginal and potentially minable. Some of these main deposits / target areas include the Emigrant Peak, St. Julian, DUV, Peter Pear, Allison, Great Eastern / Basic Metals, Montana Queen, Huckleberry, Comanche, and Floyd Counts (Map 2). Several of the targets are closely related spatially (i.e. DUV, Base Metal, Allison, Peter Pear) and may be related geologically and mineralogically. Of these known deposits, mineral resource calculations have been done for five of the deposits, all of which Lucky Minerals has indicated an intent to further explore. These five deposit’s estimated resources were based on historic drilling principally executed by Duval Corporation (1971-1972), Kennecott Copper Corporation (1990), and Pegasus Gold Corporation (1991-1992) and are displayed in Table 5.

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Table 5 – Identified resource calculations for select deposits in the Emigrant Mining District (from District (from Johnson et al., 1993 as modified by NewEdge Gold Corp., 2008 and Lucky Minerals, 2015c). The tons and grades were calculated based on an open-pit mine model.

To date, there has been a considerable amount of exploration conducted in the Emigrant area with a respectable volume of identified resources; however, there has not been any major development of the deposits. This lack of development may be due, in part, to the presence of steep slopes which could necessitate higher underground mining costs and difficult access, challenges with the refractory properties of the mineralized rock, absence of extensive supergene enrichment, and low average copper grades (<0.5 percent) (Hammarstom et al, 1993). However, as technology advances and metal prices rise, it is likely that many of these potentially limiting factors would be overcome and the deposits would be further developed over the next 20 years. Although mineral resources have been identified in the past, considerable future exploration drilling would be necessary to document more accurate tonnage and grade of potential resources. It is expected that some of the exploration target areas would also evolve into development properties with additional exploration, resource evaluation, metallurgical testing, economic analysis, and prefeasibility study work (Lucky Minerals, 2015c). In addition to Lucky Minerals’ drilling exploration program on private lands permitted by MDEQ in 2017, it is anticipated that there could be another five to seven lode exploration plans (initial and/or infill drilling) in the Emigrant area over the next 20 years. Several of these plans would occur on private lands, but some would extend onto NFS lands as they explore the known deposits, test deposit continuity, and seek out new resources. Additionally, it is expected that over the next 20 years a couple lode mineral exploration Plans would be submitted to the FS and MDEQ that are located in areas of geologic interest that currently do not have active claims. Each of the lode exploration Plans would likely consist of a combination of geophysical surveys, surface sampling, and drilling. It is assumed that each exploration drill Plan would have 15-25 drill sites located

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mostly on existing roads (pad disturbance ~60’ x 20’) and/or via helicopter access (constructed platform ~20’ x 20’). Each Plan would operate over a six month summer/fall field season needing one or two seasons, employ six to eight people, potentially construct up to a half mile of new temporary road with an average disturbance width of 35 ft. due to steepness of terrain, disturb one to two acres of land, and be analyzed under a CE or EA adding a couple years to the timeline for permitting. Active drilling at each site is expected to last between 30 and 45 days each depending on depth of hole and number of holes per site, although delays are often encountered as a result of weather conditions or drill rig availability. Equipment and supplies present onsite at locations on the road prism would include a truck or track mounted diamond drill rig and/or a reverse circulation drill rig, drill pipe truck, water trucks and tanks, sump, passenger trucks, and storage for drilling supplies. Helicopter accessed sites would have similar supplies, but would be smaller in scale and the water would likely be pumped to the site through a long hose-lay. Following completion of successful exploration phases, it is expected that near the end of the 20 year analysis period two of the deposits could be further developed into a mine. A number of other deposits (i.e. Emigrant Peak Mo-Cu porphyry) could eventually be developed into a mine; however, this would require additional exploration and delineation that would likely extend beyond the 20 year period. Due to the steepness of the terrain, configuration of the small vein/shear and breccia deposits, and the depth of the potential deposits, economic development would be conducted through a small- to medium-sized underground mine and not an open pit mine. The following predictions regarding the potential future mines were estimated from information collected from several mines in Montana and neighboring states that were thought to be comparable in tons and deposit type. While the mines vary somewhat in size, they are all considered to be smaller underground mines. Overall, the basic type of infrastructure required for a small underground mine would support a range of deposit sizes. The identified resource tonnage listed in Table 5 were based on open pit mine models, which allow for the extraction of lower ore grades. However, for reasons stated previously in the Assumptions Section 3.3.3, underground mining is considered the only feasible type of mining method that would be conducted in the Emigrant area. Consequently, the tonnages estimated for this report had to be adjusted for underground mining using a higher grade ore. For example, the DUV deposit’s identified resource at 38 million tons (Table 5) was calculated using an open-pit model; this value was later re-modeled by TetraTech using an underground mine model and determined to likely contain 1.6 million tons of gold-silver-copper ore (New Edge, 2008). This report assumes a mineral resource estimate of ~3 million tons of ore per mine Plan in the Emigrant area based on the following assumptions: the identified resource tonnage in Table 5 are scaled down to accommodate the underground mine method (i.e. higher grades and less volume); there would be newly discovered extensions off existing deposits adding to the volume; and the likelihood that adjacent deposits (i.e. DUV and St. Julian) would be mined together during the same Plan. Depending on the extent and relative connectivity of the various deposits underground, there could be one medium sized subsurface mine or a number of smaller mines each with its own portal. Based on comparable mine and mill sites, the deposit characteristics, and from conversations with Lucky Minerals officials, this RFD prediction is assuming a mill rate of 800 tons/day. Using a mill rate of 800 tons/day on a year-round work schedule (with occasional shut down for repairs) would result in ~11 years of production. Therefore, the total mine life under the No Action alternative is approximately 18 years: 4 years for planning/permitting, 1.5 years for mine development, 11 years for production, and 1 year for reclamation (not including any ongoing water treatment that may be necessary as discussed below). It is important to note that this activity would not commence until the latter half of the 20 year analysis period, and would extend beyond the reasonably foreseeable scenario timeframe.

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In regards to the milling process, much of the mineralization in this area (gold, silver, copper, lead, zinc, and molybdenum) generally occurs in disseminated sulfide minerals (USGS, 1983; Lucky Minerals, 2015c). The common processing technique using cyanide leach would not be ideal for this deposit as the gold is often combined with pyrite (refractory) and is not cyanide-soluble (USGS, 1983). Thus, the probable metallurgical processing method would be a crushing and grinding circuit followed by production of a flotation concentrate that would be shipped to an off-site smelter. For purposes of this report, it is expected that there would be one centrally located custom mill in the Emigrant area that would process ore from the numerous local deposits and then send the concentrates off-site, as described above. The mill facility, including a small temporary impoundment for waste, would have a total disturbance area of five to eight acres. However, depending on the mine design, it is possible that much of the waste rock and tailings disposal in addition to part of the actual milling process could take place underground too, consequently reducing the surface footprint. Each mine Plan would likely employee between 40-60 people including mine workers, contractors, maintenance personnel, and administration staff. It is anticipated that each mine would have a total surface footprint of disturbance between 25-30 acres with most of the disturbance located on private lands in the Emigrant area. This footprint would likely include one to two miles of new road for mine access, along with the mine portal pad, waste rock storage (some waste rock would be backfilled), topsoil and ore stockpiles, maintenance and office facilities, water storage ponds, potential land-application disposal or treatment area for mine waters, and miscellaneous supplies. Therefore, with two potential mines and one centrally located mill facility, the total disturbance would be between 55-65 acres. An important issue to keep in mind during potential mineral exploration, development, and production is the concern with acid rock drainage (ARD). As identified in the 2017 MDEQ Environmental Assessment for Lucky Minerals exploration project: ”Some of the mineralized geologic materials in the Emigrant Mining District are potentially reactive and may produce acid rock drainage or mobilize metals under near- neutral pH conditions. Some water quality samples within the district reflect the reactive nature of the geology (e.g. elevated sulfate and metals concentrations, decreased pH), and in some cases, these reactions occur naturally and are not connected to any type of human disturbance.” The issue of ARD would likely be a major factor in the final mine and mill design, and could significantly affect the feasibility and bonding requirements of such projects. For a summary of the lode deposit related activities and associated information, see Table 6 in Section 5, Summary and Conclusions Mill Sites: At the time of segregation, there were no mill or tunnel sites located in the Emigrant area. If this area would be re-opened to mineral entry at the end of the two year segregation period, there is a potential for mill site claims to be staked in this area. However, due to the steepness of the land, the widespread mineralization in Emigrant Creek, and the availability of private lands for milling purposes, the potential for construction of a new mill site on NFS lands is low. 4.3.2.2 Emigrant Proposed Action Overall Mineral Potential: Although the mineral potential for occurrence does not change based on alternatives, under the Proposed Action the potential for mineral development would likely be negatively affected in a number of ways. First, the ability to expand and fully develop a mineral resource would be limited to private lands and existing claims with VER. Second, the complexity of a project within a withdrawn area could provide investor funding challenges to a mining proponent. Furthermore, under the Proposed Action, the length of time required for permitting could take longer (i.e. five to six years to complete the NEPA) due to the level

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of public scrutiny placed upon a project located in a withdrawn area adjacent to Yellowstone National Park. This would likely reduce a claimant / company’s motivation to conduct exploration or mine development in such a difficult permitting climate. Additionally, if the withdrawal were in effect, any development and/or mine proposal involving NFS lands would require a VER determination prior to processing the Plan, which would add two to four years to the permitting process. Consequently, this would result in more expenses to the company and affect the mine’s economic feasibility. If the proposed withdrawal were in effect, there would be no new mining claims staked and only the claims existing at the time of segregation would have potential for development should they be determined to have VER. Many of the existing claims in the Emigrant area potentially host additional economic minerals as they surround a number of the known mineral resources and patented mining claims. It is expected that some of the existing claims would be determined to have VER and that there would be some mineral activity on them over the next 20 years. Placer Deposits: Within Emigrant Creek, there are a number of patented placer claims that have potential for additional resources and/or reworking of previously mined material. Similar to the No Action alternative, it is likely that there would be further placer exploration and development on the private, patented claims. These activities would consist of a series of excavations and onsite washing of the auriferous gravels over the course of one to three summer seasons (four to six months each). Currently there are three association placer claims located prior to the segregation that would be subject to VER if activities were proposed. For the purposes of this analysis, it is assumed that one of the placer claims (likely in the Emigrant Gulch area) would have VER where future mining would occur. On this unpatented claim, it is predicted that there would be a couple summer seasons of exploration work permitted by the FS and MDEQ. The exploration work would likely consist of one to two Plans on NFS lands for trenching with onsite washing to better delineate the extent of the deposit. The material would be excavated from stream and floodplain deposits and processed through a placer wash plant consisting of a grizzly, trommel or vibrating screen deck, and a series of sluices with process water captured and recycled in settling ponds. Concurrent reclamation would occur over the duration of the project, which would likely be completed in one field season. The total area of disturbance for each project would be up to three acres and each operation would employ three people. Similar to the No Action alternative, once sufficient data has been collected to support a placer mine proposal, the operator would submit a Plan for placer mining. This Plan would be similar to the exploration proposals in regards to excavation and washing and include up to one mile of new temporary road. However, the size of the excavation panel would be larger in size (five to eight acres) and would span over two to three field seasons. This size of operation could employ four to five individuals. For a summary of the placer related activities and associated information, see Table 6 in Section 5, Summary and Conclusions. Lode Deposits: Under the Proposed Action alternative, lode exploration and likely development would still occur on patented lands and unpatented claims with VER. Given the amount of exploration work conducted in the past, the number of unpatented claims surrounding the existing patented claims with identified mineral resources, in addition to professional opinion, it is likely that a number of existing unpatented claims would have VER (note: the VER determination is a separate process outside the scope of this report and this assumption is not intended to confirm or deny VER on any claim). At the time of segregation, there were three lode claims in the Emigrant area that had been determined to have an asserted right or interest in the vegetative surface resources and other resources. This means that at the time of the surface right determination in 1961, a mineral discovery was present on each claim.

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Furthermore, six of the known targets (DUV, Basic Metal, Allison, St. Julian, McAdow, and Montana Queen) have patented claims near or within their boundaries, providing opportunities for access and staging for future development and potential mining. It is also important to note that some patented lode claims (i.e. St. Julian) and potential unpatented lode claims with VER may have extra-lateral rights. These rights may extend the future subsurface mining activity on mineralized structures beyond the boundaries of patented or valid unpatented lode claims. However, even if the mineral deposit extends off-claim underground, the surface rights do not extend beyond the vertical limits of the actual claim (30 USC 26). Therefore, over the next 20 years under the proposed withdrawal scenario it is expected that there would be three to four lode exploration projects conducted in the Emigrant area on private and/or development projects on NFS lands. These exploration/development projects would be similar in size and activity to those described under the No Action alternative (Section 4.3.2.1) having 15-25 drill sites located on mostly existing roads and some helicopter sites. Each exploration/development Plan would require one to two summer/fall seasons to complete, have minimal temporary road construction (<0.25 miles), and would disturb one to three acres of land. Equipment, supplies, and personnel would be the same per project as that identified under the No Action alternative. Furthermore, it is expected that one small- to medium-sized underground mine and a small mill would be developed with concentrates hauled offsite. As the potential to explore for additional mineral resources is limited under this alternative, the expected tonnage for production is assumed to be less at ~2.5 million tons. Using the same mill processing rate of 800 tons/day, this reduction in tonnage would shorten the mine production life to approximately nine years. Therefore, the life of mine would be 17 years, which includes 5.5 years for permitting, 1.5 years for mine development, 9 years of production, and 1 year for reclamation (not including any ongoing water treatment that may be necessary). It is important to note that the timeframe for permitting is expected to increase due to the anticipated complexities resulting from the proposed Plan’s location inside of a withdrawn area. Overall, the description of mine/mill would be similar to that described in the No Action alternative, with the main difference being that there is only one mine site (instead of two) with less tonnage anticipated in the Emigrant area. Therefore, the total disturbance, workforce, and new road construction is estimated to be about half of that predicted in the No Action alternative. Given the need for VER determination prior to any continued resource delineation and/or mineral development work, the timing of implementation for mine development and production would not occur until the end of the 20 year proposed withdrawal period. For a summary of the lode deposit related activities and associated information, see Table 6 in Section 5, Summary and Conclusions. Mill Sites: At the time of segregation, there were no active mill or tunnel sites and under this alternative no new sites could be staked in the next 20 years. However, given the amount of patented claims in this area, it is likely that a mill could be constructed on private lands to process material from either private lands and/or NFS lands with existing valid claims. Additionally, material could be mined and hauled off-site for processing; therefore, not requiring a location for a mill site within the Emigrant area. 4.3.3 Crevice 4.3.3.1 Crevice No Action The Crevice area would continue to experience mineral exploration, development, and likely future production on and/or adjacent to NFS lands similar to what it has over the last 20 years under the No Action alternative. In particular, mineral activity would continue to occur in areas surrounding the identified resources (i.e. Conrad Zone, Crevice Mt North) where many of the current mining claims are located in addition to where claims have been located in the past (Map 3). However, ~549 acres of patented claims held by Kinross Gold/TVX in Jardine were recently (August, 2017) placed into a conservation easement

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prohibiting future mining activities on the subject lands; therefore, there would be no future mineral activity in that area regardless of the selected alternative. Overall Mineral Potential: The potential for mineral occurrence in the Crevice area is high with numerous known locatable deposits identified and even developed since the late 1800’s (reference #MPR). Any undiscovered deposits would likely be similar to the deposit types that have been mined in this area in the past (i.e. lode gold deposit at the Mineral Hill Mine). A USGS report estimated a 90% chance of one or more additional deposits similar to the mined Mineral Hill deposit (described in Table 3) in the Crevice-Jardine area, a 5% chance of two or more additional deposits, and a 1% chance of three or more deposits (Hammarstrom et al, 1993). Furthermore, this USGS report concluded that the median estimate for undiscovered deposits in this area is 860,000 metric tons of ore containing 8.1 metric tons of gold and negligible silver. However, if market conditions become favorable for other commodities, the irregular distribution of mineralized zones with lenticular masses of extremely variable size containing silver, copper, lead, zinc, tungsten, and even arsenic (Seager, 1944) could also be further explored and developed in the Crevice area. As stated in the MPR, the potential for locatable mineral development is also high. The following describes the anticipated levels of development activity predicted for each type of resource within the Crevice area. Placer Deposits: Under the No Action alternative, the Crevice area would continue to experience minor levels of prospecting and exploration for placer gold deposits. This activity would likely occur in reaches of Bear, Palmer, and Darroch Creeks. Although no current placer claims exist, if the area were re-opened to entry, new placer claims could be filed with subsequent activity conducted. As seen in the last few years, a couple notices of intent would be expected annually for low-level placer activities using hand tools and high-bankers near and within stream deposits throughout the summer months. There is a possibility that one placer exploration Plan of operations would be submitted to the FS for approval during this period. This placer Plan would involve excavation and washing onsite of gold bearing gravels, likely disturbing an acre or two of NFS lands, occurring over one summer field season, and employing a couple people short-term. A Plan for Placer mine development is not anticipated during this period. For a summary of the placer related activities and associated information, see Table 6 in Section 5, Summary and Conclusions. Lode Deposits: Once the segregation expires, mineral activity would likely occur in known mineralized areas in addition to other geologically favorable areas not currently under location (reference #MPR). These lands could experience future prospecting and exploration, likely in the form of drilling and geophysical surveys. Over the next 20 years, it is anticipated that there could be one or two lode mineral exploration Plans submitted to the FS in areas that currently do not have active claims. Each drilling program would likely have five to ten drill sites, up to a half mile of new temporary road, disturb one to three acres, operate over a six month summer field season requiring one or two seasons to complete, employ 5-10 people, and would be analyzed under a CE or EA. In regards to the recent mineral proposal within the Crevice area, the proponent, Crevice Mining Group (CMG), would likely continue to conduct their drill exploration program on private lands in addition to initiating their development of a decline for subsurface exploration as described in Section 4.2.2. CMG’s intent is to determine the continuity of potential ore bodies and attempt to delineate the economic ore reserves (CMG, 2016). As written in their 2016 Plan, CMG proposed to drill ~36,000 feet within the first year of an 18 month project, having an expenditure of ~$1.1 million. Per conversations with CMG (Werner, 2017), this initial proposed phase of drilling is on hold at this time. To date, the Crevice Mountain area has

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had >112,000 feet of drill hole information gathered from 1973-1996 (CMG, 2016; Hammarstrom et al, 1993). Pending the completion and results of CMG’s initial proposed exploration Plan, it is likely a second phase of infill drilling on private lands would occur with another 35-50 drill sites similar to those described in phase 1, along with up to one more mile of temporary road. In addition to the surface drilling, there would likely be continued underground exploration requiring additional waste rock storage on the surface (most on private lands) that could later be partially backfilled in the workings. In total, there could be another three to five acres of private lands disturbed in a second phase of exploration by CMG. Some of the work on phase two will be done on previously disturbed private lands, consequently reducing the total acres of new disturbance. Following CMG’s initial exploration phases on private lands, the next logical step (in a few years) would be to extend onto adjacent NFS lands with continued exploration to further define the gold resource and to collect sufficient baseline information. This third phase of exploration would span an additional three to four years for combined permitting, implementation, and reclamation. During this exploration phase on NFS lands, it is anticipated that there would be up to one new mile of temporary road constructed both for access and to host between 20 to 30 new drill sites on NFS lands, depending on the initial results from the operations conducted on private lands. Each drill pad would likely be similar in size to those proposed in CMG’s 2016 Plan (~16 ft. x 60 ft.), with most sites located on the road prism. The road prism is expected to have an average disturbance width of 30 ft., depending on topography. Therefore, the total disturbance for this third phase of exploration on NFS lands would likely be between two and four acres (including roads). Active drilling at each site is expected to last between 30 and 45 days each depending on the hole depth and number of holes per site, although delays are often encountered as a result of weather conditions or drill rig availability. Therefore, it is likely that this third phase would be implemented in one to two years total. Equipment and supplies present onsite would include a truck or track mounted diamond drill rig and/or a reverse circulation drill rig, drill pipe truck, water trucks and tanks, sump, passenger trucks, and storage for drilling supplies. It is not anticipated that helicopter drilling would occur in this area as there is broad existing road network and the topography is not as steep as the Emigrant area allowing for easier construction of temporary roads if needed. Upon completion of a successful exploration program (likely three additional exploration plans) and a feasibility study, CMG (or their successor) would submit to the FS and MDEQ a mining Plan for development of the mineral resource on Crevice Mountain. The multi-agency permitting of a new mine would likely take an additional four to five years from the time the proposal was submitted to the agencies. For reasons similar to those listed in the Emigrant section, it is reasonable to estimate that the proposed future mine at Crevice Mountain would use underground mining methods with onsite crushing and grinding circuits that eventually feeds a gravity and/or froth floatation process to extract the metals from the metal- ore. The crushed rock and/or concentrates would then be hauled offsite for final custom processing and/or smelting (i.e. possibly the Golden Sunlight Mill (~140 miles away) or to Phillipsburg, MT (~225 miles away) which are both outside of the withdrawal boundary). Based on the current estimated mineral resource at just over 490,000 ounces of gold dispersed amongst the various veins (CMG, 2016), the final mining method would necessitate the need for selective mining and sorting. Past sampling has indicated that the veins contain gold ranging from high grade (>0.25 ounce per ton (opt)) to low grade (<0.15 opt) (CMG, 2016) and the adjacent closed Mineral Hill Mine had average grade of 0.3 opt of gold (Hammarstrom et al, 1993). For purposes of this analysis, a gold value of 0.2 opt is used with the 490,000 oz gold resource to estimate ~2.5 million tons of ore that would be processed at the Crevice Mountain mine. This value includes a small buffer for additional waste rock due to the erratic vein nature of the deposit. It is anticipated that a proposed mine at Crevice Mountain would be similar in size and nature as compared to the former Mineral Hill Mine, MT and to the current Eagle Mine, MI. While these mines vary somewhat

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in size and production rates, they are all considered to be smaller underground mines supporting a similar infrastructure. For purposes of this analysis, based on literature review and from discussion with CMG (Werner, 2017) it is reasonable to assume that the proposed mine in Crevice would extract ~700 tons/day, resulting in approximately 10 years of production. A slightly smaller mill rate was used here in comparison to the Emigrant Mill due to Crevice’s vein deposit type likely resulting in less ore tonnage mined each day in addition to differences in current claimants anticipated mill processes. In the end, the total mine life in Crevice would be approximately 17 years: 4 years for planning/permitting, 1.5 years for mine development, 10 years for production, and 1 year for reclamation. However, it is likely that through additional exploration at the mine site, the mineral resources could increase in size and consequently extend the mine life. Using values from comparable mines, it is predicted that this proposed mine near Crevice Mountain would likely employee between 40-60 people including mine workers, contractors, maintenance personnel, and administration staff. It is anticipated that the Crevice mine would have a total surface footprint of disturbance between 30-40 acres with most (if not all) of the disturbance located on private lands in the Crevice area. This footprint would likely include up to two miles of new road for mine access, along with the mine portal, course ore crushing and grinding circuits, floatation mill, waste rock storage (some waste rock would be backfilled), topsoil and ore stockpiles, small tailings facility, maintenance and office facilities, water storage ponds, potential land-application disposal of mine waters (not expected), and miscellaneous supplies. As stated by Branham in CMG’s 2016 plan, “the challenge at Crevice Mountain is not to find additional gold, but to actually develop the mining techniques that can economically extract the gold… the narrow and erratic nature of the sheared vein zones/ strands and the lack of water to process the ore limited development in the 1900s and is still the challenge today. Once the mining of the current deposit is defined to be profitable, then exploration could proceed to expand the resources in the district to well over 1 million ounces.” With over 100 years of mining in this area, operational water quality monitoring has yielded no evidence of an acid mine drainage (AMD) problem in the Crevice area (CMG, 2016; Brown, 2017), likely due to the overall lack of water on Crevice Mountain. As stated in the FS’s 1986 Jardine Joint Venture FEIS: “For acid-mine drainage to occur there must be a source of 1) sulfide mineral (generally pyrite), 2) oxygen, and 3) water. The physical characteristics of the mine itself must interact to produce acid and then allow it to drain from the mine (USDA Forest Service, 1980). If any one of these three factors is absent, acid drainage cannot occur.” However, it should be noted that the former Mineral Hill Mine in Jardine has been treating small quantities of water, primarily for naturally-occurring elevated levels of arsenic (Brown, 2017). Rather than the primary mining-related water concern in the Crevice area being related to AMD, it appears the bigger issue is in regards to the lack of water for mineral processing except during a limited period in late spring and early summer. This lack of water has “seriously handicapped” past milling operations in this area (Seager, 1944). Therefore, the lack of processing water, the initial cost required for a complete new mill start-up, the smaller deposit size, shorter life of mine, in addition to the complicated permitting process for a new cyanide mill in Montana and in the Yellowstone watershed, all support the assumed scenario that final mineral processing would occur offsite at a custom mill with concentrates going to an appropriate offsite smelter. This scenario is consistent with forcasts from CMG of potentially processing their ore in Phillipsburg, MT and hauling the floatation concentrated to the Golden Sunlight Mill for leaching (Werner, 2017). Within the Crevice proposed withdrawal boundary there are 328 acres of NFS lands with “split estates” in three separate blocks (Map 1). In these cases, the FS manages the surface, but the subsurface mineral rights were reserved as private minerals. As stated in FSM 2830.1, the FS does not have the authority to deny the exercise of mineral reservation or outstanding mineral rights. Therefore, mining activities can occur on the split estate lands under both alternatives, regardless of a mineral withdrawal, as long as they are in compliance with FSM 2830 for notifying the FS of their intended use of NFS lands.

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An estimated mineral resource map (Davis, 1977) indicated potential mineral resource overlapping with portions of the split estate lands (Map 3). It is likely that these split estate lands would receive future lode exploration to either confirm or deny potential mineralization. Additionally, they are located adjacent to patented lands forming a larger, likely mineralized block of privately held mineral rights within the proposed withdrawal area. Of the three blocks of split estate lands, the largest block of private mineral rights are held by CMG who also owns the adjacent patented lands. For a summary of the lode deposit related activities and associated information, see Table 6 in Section 5, Summary and Conclusions. Mill Sites: If the Crevice area is re-opened to location under the mining laws following the segregation period, additional mill sites could be filed on lands that are non-mineral in character near the mineralized areas. The Crevice area had six active mill sites at the time of segregation; however, no known mining or milling related activity has occurred on these lands. Therefore, this alternative would also allow opportunities for the six existing mill sites to be used or occupied for mining and milling purposes without the requirement of VER. Existing Withdrawn Areas: The proposed Crevice withdrawal area also overlaps with three existing withdrawals (Map 1). There are two power site withdrawals from 1916 and 1925 that total ~289 acres. However, the subsequent 1955 Mining Claims Rights Restoration Act (PL 359) reopened these lands to mineral entry and claim location. Therefore, the two existing power site withdrawals have minimal impact on the extraction of locatable mineral resources and these area would remain open to most locatable mineral entry under the No Action alternative. The third overlapping withdrawal is ~4,128 acres adjacent and west of a series of patented claims. This existing withdrawal is only for surface entry and non-metalliferous mineral activity under a Federal Game Refuge Executive Order. Therefore, under the No Action alternative this area would be open for metallic locatable mineral entry and has the potential for future exploration and claim location. 4.3.3.2 Crevice Proposed Action Overall Mineral Potential: Analogous to the Emigrant Proposed Action (4.3.2.2), the mineral potential does not change based on alternatives. However, the ability to locate any undiscovered, existing mineral resources within the boundaries of the proposed withdrawal area would be restricted for the next 20 years. Additionally, the potential for mineral development would likely be negatively affected in a number of ways as previously described. Placer Claims: There were no active placer claims located at the time of segregation; therefore, there would be no placer exploration or mining conducted under this alternative. Lode Claims: Under the withdrawal scenario, there would be no new mining claims staked and only the claims existing at the time of segregation would have potential for development should they be determined to have VER. The 53 existing lode claims in the Crevice area surround known mineral resources on patented lands and potentially host additional economic minerals. It is expected that some of the existing lode claims would be determined to have VER and that there would be some mineral activity on them, but not to the extent that could occur under the No Action alternative. This would be due to the inability to expand mining activities off the existing claims with VER. As described in Section 4.3.1.2, activities on private lands could occur regardless of the FS’s proposed withdrawal. Similarly, proposed mining activities on the split estate lands with private mineral rights could

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also continue regardless of the proposed withdrawal. However, the ~549 acres of private lands owned by TVX in Jardine that encompass the closed Mineral Hill Mine will not have any future mineral activity due to the 2017 conservation easement placed upon them. Most of the future mineral development in this area would occur on the lands with private mineral rights. In particular, development would likely occur on the large block of lands on Crevice Mountain in the southeastern part of the proposed Crevice withdrawal area. As described under the No Action alternative, CMG would continue to conduct their extensive drill exploration program on private lands in addition to initiating their development of a decline for subsurface exploration. Following their phase one exploration, CMG would likely initiate a second phase (i.e. Plan) of infill drilling on private lands with another 35-50 drill sites similar to those described in the No Action alternative, along with approximately on mile of temporary road. In addition to the surface drilling, there would likely be continued underground exploration requiring additional waste rock storage on the surface that could later be partially backfilled in the workings. In total, there could be another three to five acres of private lands disturbed in a second phase of exploration by CMG or their successor. Following CMG’s second phase of drilling on private lands, their project would likely progress onto NFS lands on any existing lode claims that were determined to have VER. This activity would be necessary to determine the extent and grade of the mineral resource to support a mine feasibility study. Prior to Plan permitting and implementation on NFS lands, a determination that the subject claim(s) has VER would be required (two to four year process). Assuming a claim has VER and a development drilling program is initiated, it is anticipated that 10-20 drill sites would be constructed along one half to one mile of new temporary road on NFS lands, similar to, but smaller than the phase three program described in the No Action alternative. Therefore, the total disturbance for this Plan of exploration would be between one and three acres on NFS lands. Pending favorable exploration and development results from three likely exploration plans, the next logical step would be to submit a mine Plan to the CGNF and MDEQ. Whether on private lands or a combination of mostly private and some NFS lands, there is a moderate likelihood that a small underground mine would be developed on Crevice Mountain towards the end of the 20 year analysis period. The mine design would be similar to that described in the No Action alternative (Section 4.3.3.1) as the potential for the mineral resource does not necessarily change between the alternatives. However, the development potential is likely affected so that the overall footprint of disturbed acres on NFS lands is expected to be less. This is due to the inability to expand the mineral resource without having an existing claim with VER. Consequently with a smaller mineral resource block for development, the mine life could be a little shorter (i.e. eight years of production instead of ten). Overall, the likely development scenario would have a future mine site and milling facilities constructed mostly on patented lands or where there are private mineral rights (Map 1), depending on the mineral resource block configuration. Following the milling process, the concentrates would be hauled off-site, as described in the No Action alternative. This option would be in the best interest of the proponent as it would reduce the number or permitting agencies, shorten their permitting timeframe, and have less federal permitting restrictions if located entirely on private lands. For a summary of the lode deposit related activities and associated information, see Table 6 in Section 5, Summary and Conclusions. Mill Sites: The Crevice proposed withdrawal area contained six active mill site claims at the time of segregation. However, it is assumed that they would not have VER for the purposes of this analysis. This assumption is based on the fact that that none of the sites are known to have been occupied or used for mining and/or milling to date, and the mere intention to use the land for mining or milling purposes sometime in the future is generally not sufficient to validate a location (US v. Herron, A-27414 (March, 1957)) (note: the VER

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determination is a separate process outside the scope of this report and this assumption is not intended to confirm or deny VER on any claim). Therefore, it is unlikely that these sites would be developed in the future for mining and milling purposes. Existing Withdrawn Areas: The lands contained within the three existing power site and game refuge withdrawal areas encompassed by the proposed withdrawal would become removed from location and entry under the locatable mineral Mining Laws. Therefore, these areas would be closed to future exploration and development over the proposed 20 year period subject to valid existing rights.

5 Summary and Conclusions In the event of a mineral withdrawal of ~30,370 acres, the 235 active claims (226 lode, 6 mill sites, and 3 placer) would be subject to valid existing rights. Overall, it is likely that some of the claims in the proposed withdrawal area would have VER. Under the Proposed Action, existing active claims determined to have VER would still be allowed to have mining development and production activities authorized on that parcel of land. At the time a mining proposal would be submitted to the FS, the agency would conduct a site- specific environmental analysis under NEPA to analyze and disclose potential impacts along with the incorporation of project specific design criteria and mitigation measures to ensure regulatory compliance. Furthermore, mining activities would be allowed to continue on the patented mining claims and lands with private mineral rights within the proposed withdrawal area regardless of the selected action. This encompasses approximately 1,119 acres (1,668 acres with private mineral interest less the 549 private acres under the 2017 conservation easement). Activities on these lands are outside the regulatory authority of the FS. As discussed throughout Section 4.3, a summary of the predicted mineral activities under the No Action and Proposed Action alternatives is provided in Table 6. This table includes the likely scenarios (with high potential for occurrence and development) on both private and NFS lands; however, it is expected that most of the surface disturbance would occur on private lands, which would be indirectly impacted by the Proposed Action. Table 6 – Summary of reasonably foreseeable development scenarios for No Action and Proposed Action within the Emigrant and Crevice areas. In situations where there was a range of values provided above in the document, the author selected what is believed to be the most likely realistic value for comparison purposes in this table. Emigrant Emigrant Crevice Crevice Activity Unit of No Proposed No Proposed (Private and NFS lands combined) Measure Action Action* Action Action* Placer Deposits Exploration projects ** #/20 yr 3 2 1 0 Exploration duration*** yr/project 0.5 0.5 0.5 0 Exploration disturbance (total) acres 7 5 1 0 Exploration workforce (total) jobs 9 6 2 0 Mine development projects ** #/20 yr 2 1 0 0 Mine development duration*** yr/project 3 3 0 0 Mine development disturbance (total) acres 11 6 0 0 Mine workforce (total) jobs 9 5 0 0 New Road Construction (total) miles 1 1 0 0

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Total Placer Surface Disturbance # acres 15 9 1 0 Lode Deposits Exploration projects ** #/20 yr 7 3 5 3 Exploration duration*** yr/project 1-2 1-2 1-2 1-2 Exploration disturbance (total) acres 15 6 12 8 Exploration workforce (total) jobs 49 21 35 21 Mine development projects ** #/20 yr 2 1 1 1 Mine development duration*** yr/project 13 12 12 10 Mine development disturbance (total) acres 60 35 35 30 Mine workforce (total) jobs 100 50 50 50 New Road Construction (total) miles 3.0 1.5 3 2 Total Lode Surface Disturbance # acres 70 38 44 34 * Under the proposed action, “exploration” projects on NFS lands technically would be pre-development projects on claims with VER or where VER has not yet been determined, but they are included here to provide a comparison to exploration projects since the environmental effects of both are assumed to be similar. ** Projects include those that would be approved by MDEQ and/or the FS. This does not include NOI-level activity on NFS lands. *** Duration refers to actual time on the ground for implementation and reclamation. This does not include permitting timeframes. # Total disturbance is less than straight addition of all lode/placer projects because development would occur within some of the exploration and/or road footprint. One mile of road using a 12 ft wide bed with an average 30 foot disturbance is considered to encompass ~3.5 acres for total disturbance. It is important to remember that the predications throughout this report and in Table 6 are based on a number of assumptions. This information is provided solely to establish an expected level of mineral activity to be analyzed as part of the impact assessment of each alternative in NEPA analysis. The RFD is not intended for its numeric accuracy when it comes to specific predictions, but rather it uses consistent assumptions to portray the relative levels of reasonably foreseeable future actions across the two alternatives. As such, this prediction is subject to deviations such as additional geologic and mineral resource data become available, technology improves, market prices fluctuate, and/or the economic, regulatory, and/or legal circumstances change. In summary, the proposed withdrawal area under the No Action Alternative could expect up to ~130 acres of total mining disturbance from private and NFS lands over the next 20 years (0.004% of the proposed withdrawal area). In comparison, the same area under the Proposed Action Alternative could expect up to ~81 acres of disturbance from mining activities (0.003% of the proposed withdrawal area). This is a total difference of ~49 acres (0.001%) of predicted mining disturbance between the two alternatives.

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6 References Bates, R.L., and Jackson, J.A., eds., 1984, Dictionary of Geological Terms, 3rd edition, The American Geological Institute, 571 p. Blackman, L., 1994, The Potential for Undiscovered Mineral Resources in the Absaroka-Beartooth Study Area, part of the Custer and Gallatin National Forests, Montana: U.S. Bureau of Mines, Mineral Land Assessment open file report 7-94, 17 p. Brown, John, 2017, Montana Department of Environmental Quality (MDEQ), personal communication August 25. Crevice Mining Group (CMG), 2016, amended Plan of Operations: Exploration Program Crevice Mining Project, prepared for Montana DEQ Hard Rock Mining Program, 192 p. Davis, 1977, Geochemical Gold Survey Surveys of the Jardine- Crevice Mountain District, Park Co., Montana between1974 to 1977, Interim report for Homestake Mining Company, Private report. Day, W.C., Hammarstrom, J.M., Zientek, M.L., and Frost, T.P., eds., 2016, Overview with methods and procedures of the U.S. Geological Survey mineral-resource assessment of the Sagebrush Focal Areas of Idaho, Montana, Nevada, Oregon, Utah, and Wyoming: U.S. Geological Survey, Scientific Investigations Report 2016–5089–A, 211 p., http://dx.doi.org/10.3133/sir20165089A. Ellsworth, P. 2017, Lucky Minerals Project Manager, personal communication October 23. Gallatin National Forest Plan. 2015. Custer Gallatin National Forest. http://www.fs.usda.gov/main/ custergallatin/landmanagement/planning (accessed May 11, 2017). Grosvenor, R., 2017, personal communication with US Forest Service, Gallatin National Forest Minerals Administrator. Hammarstrom, J.M., Zientek, M.L., and Elliott, J.E., eds., 1993, Mineral resource assessment of the Absaroka-Beartooth study area, Custer and Gallatin National Forests, Montana: U.S. Geological Survey, Open-File Report 93-207, 298 p. Available online at: https://pubs.er.usgs.gov/ publication/ ofr93207 International Council on Mining and Metals (ICMM), 2012, Trends in mining and metals industry, https://www.icmm.com/website/publications/pdfs/4441.pdf (accessed June 20, 2017, 16 p.) Johnson, R., Boleneus D., Cather E., Grahm D., Hughes C., McHugh E., and Winters D., 1993. Mineral Resource Appraisal of the Gallatin National Forest, Montana: U.S. Bureau of Mines, Mineral Lands Assessment open file report 19-93, 183 p. Lane, J., 2017, Montana Department of Environmental Quality (MDEQ), personal communication July 24. Lucky Minerals, 2015a, Emigrant Plan of Operations for Drilling Activities on Private Land, submitted by Shaun M Dykes, 15 p. Lucky Minerals, 2015b, Updated Emigrant Plan of Operations for Drilling Activities on National Forest System Lands, submitted by Shaun M Dykes, 18 p. Lucky Minerals, 2015c, The Emigrant Mining District Project South Central Montana: A National Instrument 43-101 report, prepared by Geologic Systems Ltd., 89 p.

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Montana Department of Environmental Quality (MDEQ), 2017a, http://deq.mt.gov/Land (accessed July 7, 2017). Montana Department of Environmental Quality (MDEQ), 2017b, Final Environmental Assessment on Lucky Minerals Project Exploration License Application #00795, 376 p. Available online at: http://deq.mt.gov/Portals/112/Land/Hardrock/Active%20Applications/LuckyMinerals/LuckyMin erals_EA_Final_Web_2017.pdf?ver=2017-07-25-164916-037 NewEdge Gold Corporation, 2008, unpublished draft of The Emigrant Mining District Project South Central Montana: A National Instrument 43-101 report, prepared by Tetra Tech, 106 p. Peters, W., 1987, Exploration and Mining Geology, Second Edition: Wiley Publishing, 537 p. Seager, G., 1944, Gold, arsenic, and tungsten deposits of the Jardine-Crevasse Mountain District, Park County, Montana: Montana Bureau of Mines and Geology Memoir 23, 111 p. Shumaker, 2017, personal communication via email (August 31) with BLM Lead Mineral Examiner, 2 p. US Bureau of Land Management (BLM), 2017a, https://www.blm.gov/programs/energy-and-minerals/ mining-and-minerals/locatable-minerals/mining-claims, (accessed July 14, 2017). US Bureau of Land Management, 2017b, http://lr2000.blm.gov/, (accessed October 31, 2017) US Bureau of Land Management, 2016, Guidance on 43 CRF 3809.100 and its Application: Instruction Memorandum No. 2016-149, 2 p. US Forest Service (FS), 1980, Users Guide to Hydrology Mining and Reclamation in the West: General Technical Report INT-74. US Forest Service, 1986, Jardine Joint Venture Final Environmental Impact Statement, Gallatin National Forest, Bozeman MT. 544 p. US Forest Service, 1995, Anatomy of a mine from prospect to production: General Technical Report INT- GTR-35 Revised, https://www.fs.fed.us/geology/anatomy_ mine.pdf , 76 p. US Geological Survey (USGS), 2017, Mineral Commodity Statistics and Information, https://minerals.usgs.gov/ minerals/ pubs/commodity/ (accessed July 14, 2017). US Geological Survey, 1999, Giant Porphyry-Related Metal Camps of the World — A Database by Felix E. Mutschler, Steve Ludington, and Arthur A. Bookstrom. US Geological Survey OPEN-FILE REPORT 99-556. Available online at: https://pubs.usgs.gov/of/1999/of99-556/ US Geological Survey and US Bureau of Mines, 1983, Mineral Resources of the North Absaroka Wilderness Study Area, Park and Sweet Grass Counties, Montana; US Geological Survey Bulletin 1505, 251 p. Available online at: https://pubs.er.usgs.gov/publication/b1505 Wedow, H. Jr., Gaskill, D., Banister, D., Pattee, E., 1975, Mineral resources of the Absaroka Primitive Area and vicinity, Park and Sweet Grass Counties, Montana: US Geol. Survey Bull. 1391-B, 115 p. Werner, M., 2017, personal communication via phone (September 6) with Managing Partner of Crevice Mining Group LLC. Whithorn, D., 2002, Emigrant Gulch: Searching for Gold in Park County, Montana (Images of America), Chicago, IL: Arcadia Publishing Library Editions, 128 p.

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Maps:

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Map 1 – Emigrant Crevice proposed withdrawal general location – two parcels outlined in red.

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Map 2 – Active mining claims and mineral targets in the proposed Emigrant withdrawal area. Note: Mining claim locations are approximate as referenced from mining claimant’s location notices for claims shown as active in the BLM LR2000 database on 10/31/17. Mineral targets are approximate as derived from various literature and claimant submittals, they do not constitute proof of a mineral resource.

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Map 3 - Active mining claims and mineral targets in the proposed Crevice withdrawal area. Note: Mining claim locations are approximate as referenced from mining claimant’s location notices for claims shown as active in the BLM LR2000 database on 10/31/17. Mineral targets are approximate as derived from various literature and claimant submittals, they do not constitute proof of a mineral resource.

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Map 4 –Historic mining districts in the Absaroka-Beartooth area (Hammarstrom et al., 1993). Two parcels (Emigrant and Crevice) are generally outlined in red.