Memorandum. Introduction. Carl Einberger Joe Morrice. Figures 1 through 7

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1 Memorandum TO: Michelle Halley, NWF DATE: October 9, 2007 FROM: Carl Einberger Joe Morrice PROJ. NO.: CC: Project File PROJ. NAME: National Wildlife Federation ATTACHMENTS: Tables 1 through 6 Figures 1 through 7 SUBJECT: Introduction Groundwater Modeling Analysis Eagle Mine Review NWF Marquette County, Michigan Geomatrix has completed a groundwater modeling analysis of the proposed Kennecott Eagle mine in Marquette County, Michigan, at the request of the National Wildlife Federation (NWF). Four previous groundwater modeling analyses were described in various appendices of the Environmental Impact Assessment (EIA) and the groundwater discharge permit application submitted by Kennecott Eagle Minerals Company (KEMC): FEFLOW model of bedrock inflow during mine dewatering (Appendix B-4 of the EIA; Golder Associates [Golder], 2006a); MODFLOW analysis of mounding due to infiltration at the Treated Water Infiltration System (TWIS) and of drawdown in the alluvial deposits due to mine dewatering (Appendix B-7 of the EIA; Fletcher Driscoll and Associates, LLC [Fletcher Driscoll], 2006); MODFLOW model of drawdown effects on adjacent wetlands associated with mine dewatering (Appendix B-7 of the EIA; Fletcher Driscoll, 2006); and MODFLOW analysis of mounding during infiltration at the TWIS (Appendix E-3 of the groundwater discharge permit application; Golder, 2006b). As an independent check conducted for the Keweenaw Bay Indian Community (KBIC), Wittman Hydro Planning Associates (WHPA) also developed a groundwater flow model to evaluate potential mine impacts on groundwater with emphasis on groundwater flow from the TWIS (WHPA, 2007).

2 Memorandum October 9, 2007 Page 2 The current modeling effort represents a refinement of the model developed by WHPA. Modifications to the model made by Geomatrix include: The WHPA model grid was converted from a single layer to a multilayer (six layer) model to allow better representation of the geometry of the bedrock, the overlying coarseand fine-grained unconsolidated deposits, and the Yellow Dog and Salmon Trout Rivers. The upper four layers generally correspond to the A-Zone, B/C-Zone, D-Zone, and till, while the lowest two layers represent bedrock; Bedrock elevations in the vicinity of the Eagle Rock outcrop were modified to improve the match with mapped bedrock elevations; Boundary conditions were adjusted to support conversion to a multilayer model and to allow calibration of groundwater levels predicted by the model to water level data collected from site monitoring wells. The existing general head boundary was extended along the east side of the model to represent the northward flowing portion of the Yellow Dog River. More drain boundaries were added along the escarpment at the north end of the Yellow Dog Plains; Conductance terms at river, general head, and drain boundaries were adjusted during model calibration to improve correlation between the model predicted and measured water levels. Hydraulic conductivity values were also adjusted during the calibration process; Recharge was reduced from 17.5 inches per year to 10 inches per year during the model calibration. This is on the lower end of the range of recharge values used by Fletcher Driscoll; Groundwater recharge from the TWIS was simulated using a recharge boundary, rather than a well boundary; Mine inflow was modeled using drain boundaries rather than wells. Drain conductance values were adjusted until target inflow values achieved; and Assumed TWIS discharge rates were 5 gallons per minute (gpm) greater than mine inflow, rather than 100 gpm, to account for stormwater flows. This assumption is more consistent with modeling performed by Fletcher Driscoll, where TWIS discharge rates were approximately 5 and 20 gpm higher than average mine inflow rates for the base case and upper bound case mine inflow models, respectively. Using a reasonable set of hydraulic parameters, the refined model predicts significantly more impact to wetlands and surface water flows in the vicinity of the mine site than were estimated by Fletcher Driscoll. Groundwater level drawdown of up to 12 feet (ft) in the wetlands overlying the ore body are predicted with the current model, compared to less than 1 ft of drawdown J:\ National Wildlife Federation\000\Groundwater Modeling Analysis_Sx.doc

3 Memorandum October 9, 2007 Page 3 predicted by Fletcher Driscoll. Similarly, the current model predicts a reduction in flow of up to 0.16 cubic feet per second (cfs) in the Salmon Trout River, compared to virtually no impact predicted by Fletcher Driscoll. Previous modeling investigations conducted by KEMC s consultants are summarized below, followed by details regarding the current modeling investigation conducted by Geomatrix for NWF. Summary of Previous Modeling FEFLOW Model A FEFLOW model was employed to estimate groundwater inflow to the mine associated with mine dewatering. This model was developed for the purposes of mine design, including sizing of mine dewatering conveyance and infiltration systems. The FEFLOW model was not intended to evaluate impacts of mine dewatering or treated water infiltration on the alluvial aquifers or surface water bodies. Two cases were modeled: a base case and an upper bound case. For both cases, the basic model geometry was the same, with no flow boundaries along the bottom and sides and a constant head boundary along the top representing the contact between the base of the alluvium and the top of the upper bedrock. The bedrock was divided into two units based on depth: the upper bedrock (with a higher hydraulic conductivity) and the lower bedrock (with a lower hydraulic conductivity). Each case also included water conductive features (i.e., fractures) limited to the immediate vicinity of the mine workings. It is unclear why fracture features are not included throughout the modeled bedrock body. Although fracture features may or may not be connected over long distances, non-connected features increase the overall water transmitting ability of the bedrock. In addition, basing the fracture spacing on the very limited reported data set on packer and pump testing does not appear to be a conservative approach. The base case model predicted groundwater inflows to the mine would start at about 60 gpm and gradually increase to approximately 75 gpm by the end of the 10 year mine life. The upper bound case model predicted groundwater inflows to the mine would increase from about 125 gpm at the start of mining to approximately 215 gpm by year 3 of mining, and remain at that rate through the rest of the mine life. The modeling approach does not provide a conservative estimate of potential impacts to the overlying alluvium from mine dewatering. Because hydraulic heads in the alluvium are held constant, the model likely under predicts drawdown in the upper bedrock, leading to concerns when the FEFLOW results are subsequently used to develop the MODFLOW model of drawdown in the alluvial deposits associated with mine dewatering (see below). J:\ National Wildlife Federation\000\Groundwater Modeling Analysis_Sx.doc

4 Memorandum October 9, 2007 Page 4 MODFLOW Model of Mine Impacts This model was developed to evaluate the impacts of mine dewatering and infiltration on groundwater levels in the alluvial aquifer and associated effects on stream flows and wetlands. The report also included a vertical slice model focused on wetland impacts near the Salmon Trout River (described in more detail in the next section). In addition to the alluvial deposits, the MODFLOW model includes the upper and lower bedrock. Hydraulic parameters for the bedrock were determined by calibrating the MODFLOW model until it predicted drawdown results similar to what was predicted by the FEFLOW model. The final hydraulic conductivity or storage values used for the bedrock are not reported. The FEFLOW model was not appropriately designed to provide a basis for the calibration of the MODFLOW evaluation of effects on the alluvial aquifer. The FEFLOW results likely underestimate drawdown in the upper bedrock because of the use of a constant head boundary condition along the top of the FEFLOW model. Since the MODFLOW model is calibrated to the FEFLOW results, this suggests that the MODFLOW model also under predicts drawdown in the upper bedrock zone and the overlying alluvial deposits. Two cases were simulated corresponding to the base case and upper bound case dewatering rates from the FEFLOW model. It appears from the documentation that the two models were identical, with the exception of higher hydraulic conductivity applied to the lower bedrock and higher dewatering rates for the upper bound case. In the base case and upper bound model, some of the flux boundaries which represent groundwater inflow to the mine went dry, reducing the simulated amount of water removed by the model and associated effects. Based on results from these models, KEMC concluded that the effects on streamflow would be minimal and that the maximum drawdown of groundwater elevations at the water table would be about 0.75 ft, with a maximum drawdown in the B-Zone aquifer above the mine of about 0.9 ft. MODFLOW Model of Drawdown at Wetlands This model was intended to refine the predictions of the larger MODFLOW model of mine impacts to evaluate the effects of mine dewatering on wetlands. A two-dimensional, vertical slice model was constructed extending from the Salmon Trout River and associated wetlands at WL0025, through QAL043 and QAL044. The model was then calibrated to water levels from wells QAL043B and QAL044B and wetland piezometers QAL and QAL In the resulting calibration, the horizontal hydraulic conductivity values were about 20 to 30 times lower than what were used in the other MODFLOW models. Similarly, the vertical anisotropy (the ratio of horizontal to vertical hydraulic conductivity) was 100 to 1, versus ratios of 10 to 1 to about 30 to 1 in the other models. The rationale for using hydraulic conductivity values significantly lower and anisotropy ratios considerably higher than the other modeling efforts J:\ National Wildlife Federation\000\Groundwater Modeling Analysis_Sx.doc

5 Memorandum October 9, 2007 Page 5 calls into question the conclusions reached from these model runs, since both categories of assumptions would reduce simulated drawdowns in alluvial groundwater levels. The water levels that were used for calibration appear to be based on a limited set of measurements collected in November and December, 2005 and presented in Appendix B-6 of the EIA (Wetland Hydrology Report). It is unclear if the relatively high downward vertical gradients are representative of long term average conditions, or are a seasonal or anomalous artifact. It appears that the calibration resulting in significantly lower hydraulic conductivity values for this model was driven in large part by attempting to match these relatively high vertical gradients. After calibration, the hydraulic head at the base of the model was reduced by 1 ft to represent the effects of mine dewatering at the base of the B-Zone, based on the results of the MODFLOW model of mine impacts on the alluvial aquifer. The drawdown estimates are likely biased low because of problems with the mine impact MODFLOW model that are discussed in a previous section of this memorandum. Based on results of this model, KEMC concluded that impacts to wetlands above the mine workings would be between 0.41 and 0.66 ft. MODFLOW Model of Mounding During Infiltration at the TWIS The purpose of this MODFLOW analysis was to evaluate the degree of mounding at the TWIS, and to estimate flow paths and travel times for the infiltrated water to discharge to surface water. Selected values for hydraulic parameters used in this model are consistent with field data and appear to be reasonable for the aquifer materials modeled. However, the model geometry and flow field are greatly simplified in the model domain. Specifically, the model does not include surface water features such as the Salmon Trout River, geologic features such as the Eagle Rock outcrop, or the effects of drawdown from mine dewatering. Steady-state conditions were reportedly simulated using an infiltration rate of 400 gpm. Sensitivity runs performed in the original and subsequent modeling (discussed in a KEMC June 2, 2006, letter to the Michigan Department of Environmental Quality) show mounding beneath the TWIS that ranges from about 13 to 25 ft above existing groundwater elevations. Kennecott concludes based on this analysis that all infiltrated water will flow to the northeast, discharging to streams and springs along the escarpment slope. Objectives The objectives of the current modeling effort are the following. Revise and refine the single-layer WHPA model to include additional layers representing unconsolidated aquifer units (A-Zone, B/C-Zone, D-Zone, Till) and bedrock; adjust boundary conditions representing the Salmon Trout and Yellow Dog Rivers to improve correlation with surface water elevations at these locations; and modify hydraulic J:\ National Wildlife Federation\000\Groundwater Modeling Analysis_Sx.doc

6 Memorandum October 9, 2007 Page 6 conductivity values and boundary conditions to improve correlation with measured groundwater elevations. Use the revised model to assess the potential magnitude and extent of groundwater drawdown in the unconsolidated aquifer associated with mine dewatering, particularly in the A-Zone beneath the Salmon Trout River and wetlands overlying the ore body. Assess potential reductions in streamflow in the Salmon Trout River caused by mine dewatering and associated drawdown of groundwater elevations over the mine workings. Assess potential groundwater mounding and groundwater flow paths associated with the proposed mine TWIS. Model Development and Calibration This section describes model development and calibration. The groundwater flow model was developed using the public domain USGS MODFLOW-2000 modeling code with the proprietary Groundwater Vistas (version 5) pre- and post-processing program. Groundwater flowpaths from the TWIS to discharge areas along the escarpment were modeled using the USGS MODPATH particle tracking code. The flow model was calibrated to water level data from 29 monitoring wells completed in both the A-Zone and D-Zone sand-dominated aquifers. The calibration consisted of iteratively adjusting the assigned hydraulic conductivity, boundary condition conductance, and head values until simulated water levels approximated measured water levels. Final hydraulic conductivity values and boundary conditions used in the model, along with a summary of calibration results, are presented below. Model Domain and Grid The model domain and model grid are presented in Figure 1. The plan view extent of the model domain is consistent with the WHPA model, and covers the entire Yellow Dog Plains, extending from the Yellow Dog River along the south and east to the steep escarpment of the outwash plain on the north. The west edge of the model is located at the approximate surface water divide between the Yellow Dog and Salmon Creek drainages and Anderson Creek. In plan view, the model is discretized into a uniform 200 by 200 ft grid, consisting of 95 rows and 227 columns. Vertically, the model is discretized into six layers. Starting at ground surface and moving downward the layers are as follows: Layer 1 represents the A-Zone sand-dominated aquifer. Layer 2 represents the B/C-Zone fine sand, silt, and clay, where present. The fine-grained B/C-Zone materials appear to pinch out to the north, based on the limited J:\ National Wildlife Federation\000\Groundwater Modeling Analysis_Sx.doc

7 Memorandum October 9, 2007 Page 7 borehole data available. Where these materials are not present, Layer 2 instead represents the A-Zone sand. Layer 3 represents the D-Zone sand-dominated aquifer. Layer 4 represents the basal till. Layers 5 and 6 represent bedrock and mine workings. The model extends from ground surface of approximately 1,460 ft to the bottom of the active bedrock layers at an elevation of 1,115 ft. Layer thicknesses in the unconsolidated material (Layers 1 through 4) range from about 2 ft where bedrock is near ground surface and the thickness of unconsolidated material is at a minimum, up to about 135 ft where bedrock is relatively deep. The bedrock layers are up to 150 ft thick in the vicinity of the ore body and the Eagle Rock outcrop. Material Properties Uniform values of hydraulic conductivity were used for each material type (e.g., A-Zone, Till). Hydraulic conductivity values for each material type were adjusted until modeled groundwater elevations and the overall shape of the groundwater flow field approached measured values from August 2005 (North Jackson, 2006). Final hydraulic conductivity values used in the model are presented in Table 1. Values for the A-Zone, B/C-Zone, and D-Zone are within the range of measured values in these units presented by KEMC (North Jackson, 2005). Measured hydraulic conductivity values were not identified for the Till; however final values used in the model are within the range of literature values for this material type. The MODPATH particle tracking model requires effective (interconnected) porosity values to calculate groundwater velocities. Values used in the model are summarized in Table 1. Specific yield (the ratio of the volume of water that drains by gravity to the volume of aquifer) is generally equal to effective porosity. The effective porosity of the A-Zone and D-Zone was selected as the average specific yield (0.048) of the A-Zone aquifer (North Jackson, 2006). Effective porosity values for the B/C-Zone, till, and bedrock were selected from typical literature values. The flow model was run under steady-state conditions, and therefore other storage properties of the material types do not affect the model results. Boundary Conditions Four types of boundary conditions (recharge, river, general head, and drain) were applied in the model to represent sources and sinks of groundwater, including infiltration of precipitation, groundwater flow interaction with the Salmon Trout and Yellow Dog Rivers, and discharge of groundwater to seeps and springs along the north edge of the Yellow Dog Plains escarpment. For predictive simulations of the potential effects of mining, additional boundary conditions J:\ National Wildlife Federation\000\Groundwater Modeling Analysis_Sx.doc

8 Memorandum October 9, 2007 Page 8 were applied to represent mine groundwater inflow and discharge of wastewater at the TWIS. Specific boundary conditions and the hydrologic features they represent are summarized on Table 2 and include the following. Recharge. Recharge is applied at the top of the model to represent infiltration of precipitation and, during mining, infiltration of wastewater at the TWIS. A uniform recharge rate of ft per day (ft/day) (10 inches per year) was applied to the model to represent infiltration of precipitation, which is at the lower end of the range of recharge values used by Fletcher Driscoll. For predictive simulations of the effects of mining, additional recharge was applied at 11 model cells located under the TWIS. Two predictive simulations were completed using TWIS discharge rates of 80 gpm and 255 gpm. These discharge rates are 5 gpm higher than the mine inflow rates for the respective simulation scenarios. This assumption is consistent with modeling performed by Fletcher Driscoll, where TWIS discharge rates were approximately 5 and 20 gpm higher than average mine inflow rates for the base case and upper bound case mine inflow models, respectively, to account for stormwater inputs to the TWIS. Distributing these discharge rates over the 440,000 square feet (ft 2 ) represented by the 11 model cells results in recharge rates at the TWIS of and ft/day, respectively. River Boundary. The Salmon Trout River was simulated as a river boundary using the MODFLOW RIV package. This is a head-dependent flux boundary where flow between the river and groundwater is controlled by hydraulic head differences between the river and adjacent groundwater, and by a conductance term that incorporates the length and width of the river in the model cell and the thickness and hydraulic conductivity of the river bed sediments. Head values assigned to the river boundary were based on interpolation of surface elevations from a composite map based on 1982 U.S. Geological Survey (USGS) topographic basemaps. Conductance values used in the final model were developed as part of the calibration process. General Head Boundary. The Yellow Dog River was simulated as a general head boundary (GHB) using the MODFLOW GHB package. This boundary type is similar to the river boundary, and requires a head value and conductance term to describe flow between the river and groundwater. Head values assigned to the GHB were based on interpolation of surface elevations from the composite map based on 1982 USGS topographic basemaps. Conductance values used in the final model were developed as part of the calibration process. Drain. Drain boundaries were used to simulate groundwater discharge along the escarpment at the north side of the Yellow Dog Plains. As for the GHB and river boundaries, drain boundaries require a head value and a conductance term to describe the discharge of groundwater to the drain. Unlike the GHB and river boundaries, which can act as both a source and sink to groundwater, a drain boundary only acts as a sink, J:\ National Wildlife Federation\000\Groundwater Modeling Analysis_Sx.doc

9 Memorandum October 9, 2007 Page 9 removing water from the groundwater flow system. If the water level falls below a specified drain elevation, flow to the drain ceases. Initial drain boundary head values were based on the approximate elevation of seeps and springs mapped along the escarpment. Final drain head values and conductance values were developed as part of model calibration. Drain boundaries were also used to simulate groundwater inflow to the mine during predictive simulations. The uppermost proposed mine workings in the ore body are the 383 level (383 meter level) at an elevation of approximately 1,250 ft. To represent groundwater inflow to the mine, drain boundaries were specified in cells within the ore body footprint in the lowest bedrock layer of the model (Layer 6). Drain conductance values for these cells were varied until a specific mine inflow rate (i.e., 75 gpm or 250 gpm) was produced by the model. Calibration Results The model was calibrated to observed water levels (targets) in 29 monitoring wells. The following calibration statistics were used to evaluate the quality of the calibration: Mean Error (ME), the arithmetic mean of residuals. A residual is equal to a simulated value minus an observed value. In general, model calibration should aim for an ME near zero and the absolute value of ME should be less than 5 percent of the difference between the largest and smallest target values. Root Mean Square Error (RMSE). This statistic is calculated by taking the square of the residual, summing the values, dividing by the number of observations, then taking the square root. Percent Root Mean Square Error (%RMSE). The %RMSE is the RMSE divided by the difference between the largest and smallest target value and multiplied by 100. In general, model calibration should aim for a %RMSE less than 10 percent of the difference between the largest and smallest target values. Calibration statistics are summarized on Table 3. The ME of 0.60 ft is less than 1 percent of the range in target values, indicating a generally good calibration without a major high or low bias to the water levels. The %RMSE of 14% is somewhat higher than the target criteria of 10%, but still indicates a relatively good calibration. This measure of calibration error could likely be reduced by using spatially varying hydraulic conductivity values for each of the aquifer materials, rather than the uniform values applied in the current model. Given scope and schedule constraints, variable hydraulic conductivities within specific aquifers zones were not incorporated into this investigation. J:\ National Wildlife Federation\000\Groundwater Modeling Analysis_Sx.doc

10 Memorandum October 9, 2007 Page 10 Final modeled groundwater elevation contours for the A-Zone (Layer 1) and D-Zone (Layer 3) are presented on Figures 2 and 3, respectively. Dry cells (shown in purple) occur in the A-Zone and D-Zone near the Eagle Rock outcrop, where bedrock extends to the ground surface. Dry cells also occur in the A-Zone downgradient of the TWIS and near the eastern edge of the Yellow Dog Plains where groundwater elevations drop below the bottom of the A-Zone. Overall modeled groundwater elevations and flow directions are generally consistent with contour maps developed from the field data. In addition, predicted streamflows in the Salmon Trout River were generally consistent with available data, although a rigorous streamflow calibration was not conducted, given scope and schedule limitations. Predictive Modeling Predictive models were developed to assess the potential impacts of mine dewatering and wastewater discharge to the TWIS. Mine inflow and TWIS discharge rates of 75 gpm and 250 gpm were simulated. Tables 4 through 6 present a comparison of the modeled drawdown, mounding, and reductions in streamflow in the Salmon Trout River to results presented by Fletcher Driscoll. In previous work, WHPA also evaluated a most conservative case with a 900 gpm mine inflow rate; however this rate could not be sustained in the current model without drying out overlying model cells and introducing numerical model instabilities. Scenario 1 75 gpm Inflow Rate Scenario 1 uses a mine inflow rate of 75 gpm and TWIS discharge rate of 80 gpm. These values are equal to the average base case inflow and discharge rates presented in the Fletcher Driscoll modeling. Contours of modeled groundwater drawdown above the ore body and mounding beneath the TWIS are presented in Figure 4. At a mine inflow rate of 75 gpm, approximately 3 ft of drawdown is predicted to occur in the A-Zone beneath the wetlands and the Salmon Trout River near the ore body (Table 4). Drawdown greater than 0.5 ft is predicted to extend approximately 1/2 mile from the ore body in all directions. The predicted drawdown is significantly greater than the maximum drawdown of 0.12 ft presented by Fletcher Driscoll. Modeled groundwater discharge to the Salmon Trout River is predicted to decrease by between 0.03 cfs at the ore body to 0.07 cfs at the escarpment (Table 5). Fletcher Driscoll predicted no change in groundwater discharge to the Salmon Trout River for this scenario. Modeled groundwater mounding beneath the TWIS is slightly higher in the current model (12.19 ft) than in the Fletcher Driscoll model (8 ft) (Table 6). Groundwater flowpaths based on the MODPATH particle tracking model are shown on Figure 5. The flowpaths indicate the modeled groundwater mound is not sufficient to change the overall north-northeast groundwater flow direction from the TWIS to the escarpment. Modeled groundwater travel times between the J:\ National Wildlife Federation\000\Groundwater Modeling Analysis_Sx.doc

11 Memorandum October 9, 2007 Page 11 TWIS and discharge to surface water is approximately 4 to 6 years with the current model, which is generally consistent with the 5 to 10 year travel times predicted by Fletcher Driscoll. Scenario gpm Inflow Rate Scenario 2 uses a mine inflow rate of 250 gpm and TWIS discharge rate of 255 gpm. This is somewhat higher than the average inflow rate of 230 gpm for the upper bound case presented in the Fletcher Driscoll modeling, but it is consistent with the mine inflow rate used for design of the Waste Water Treatment Plan and water balance calculation used in the permit application. (See mine permit application Figures 4-18 A and B and groundwater discharge application Figures 4-1 and 4-2). It is also consistent with modeling conducted by WHPA. Contours of modeled groundwater drawdown above the ore body and mounding beneath the TWIS are presented in Figure 6. At a mine inflow rate of 250 gpm, nearly 12 ft of drawdown is predicted to occur in the A-Zone beneath the wetlands and the Salmon Trout River near the ore body (Table 4). Drawdown greater than 0.5 ft is predicted to extend approximately 1 mile from the ore body in all directions. The predicted maximum drawdown is significantly greater than the maximum drawdown of 0.95 ft presented by Fletcher Driscoll. The extent of drawdown greater than 0.5 feet is also significantly greater than the approximately 0.3-mile radius around the ore body predicted by Fletcher Driscoll. Modeled groundwater discharge to the Salmon Trout River is predicted to decrease by between 0.06 cfs at the ore body to 0.16 cfs at the escarpment (Table 5). Fletcher Driscoll predicted a maximum decrease in groundwater discharge to the Salmon Trout River of 0.02 cfs. Modeled groundwater mounding beneath the TWIS is nearly 30 ft in the current model compared to 21 ft in the Fletcher Driscoll model (Table 6). Groundwater flowpaths based on the MODPATH particle tracking model are shown on Figure 7. The flowpaths indicate the modeled groundwater mound is not sufficient to change the overall north-northeast groundwater flow direction from the TWIS to the escarpment. Mounding of 30 ft results in limited local radial flow away from the TWIS to the east, west, and south; however, overall groundwater flow from the TWIS remains towards the north-northeast. Modeled groundwater travel times between the TWIS and discharge to surface water is approximately 2 to 6 years with the current model, which is generally consistent with the less than 5 to less than 10 year travel times predicted by Fletcher Driscoll. Conclusions The current modeling effort suggests that significantly greater impacts would occur due to mine dewatering than were predicted by Fletcher Driscoll for the mine permit application. In the current model, using a reasonable set of hydraulic parameters, groundwater drawdown in the J:\ National Wildlife Federation\000\Groundwater Modeling Analysis_Sx.doc

12 Memorandum October 9, 2007 Page 12 wetlands and impacts to flows in the Salmon Trout River are more than 10 times greater than previously predicted. There are several potential reasons for these discrepancies, including: The Fletcher Driscoll model was run as a transient model over the 10-year expected life of the mine plus a 10-year post-mining period. The current model was run as a steady-state model, because preliminary tests of transient runs with the model indicate that steady state conditions are approached before the end of mine life. Storage values used by Fletcher Driscoll are not well documented. Using unreasonably high storage values for the bedrock or overlying unconsolidated deposits in the transient model runs would result in an underprediction of the impacts of mine inflows. Model calibration to the pre-mining water levels is relatively insensitive to hydraulic conductivity values for the Till unit, while predictive model results are more sensitive to the vertical hydraulic conductivity of the Till. Hydraulic conductivity values for the Till used by Fletcher Driscoll are not documented; however, lower values would bias model results toward smaller impacts. These models were run using KEMC s estimated range of mine inflow values as a basis. Studies analyzing rock mass quality of the ore body, including the crown pillar area, are in progress by Dr. Marcia Bjornerud of Lawrence University and Dr. Stan Vitten of Michigan Technological University. It is our understanding that their work suggests that mine inflow rates could be significantly higher, possibly leading to higher groundwater inflow rates to the mine and greater reductions in groundwater elevations and streamflows of the Salmon Trout River (and potentially the Yellow Dog River) than predicted using the assumptions incorporated into this modeling investigation. References Fletcher Driscoll (Fletcher Driscoll and Associates, LLC), 2006, Predictive Assessment Modeling of the Quaternary Alluvium Hydrogeology, Eagle Project, Marquette County, Michigan. Golder (Golder Associates), 2006a, Bedrock Hydrogeological Modeling to Assess Inflow to Proposed Eagle Project, February 10. Golder, 2006b, Groundwater Flow Model of the Treated Water Infiltration System, April 21. North Jackson Company, 2006, Kennecott Eagle Minerals Company, Eagle Project, Comprehensive Summary of Hydrogeologic Reports, February. WHPA (Wittman Hydro Planning Associates), 2007, Groundwater Modeling Analysis, Kennecott Eagle Mine Permit. J:\ National Wildlife Federation\000\Groundwater Modeling Analysis_Sx.doc

13 TABLES

14 TABLE 1 FLOW MODEL MATERIAL PROPERTIES SUMMARY Eagle Mine Review - NWF Marquette County, Michigan Unit Horizontal Hydraulic Conductivity (ft/day) Vertical Hydraulic Conductivity (ft/day) Effective Porosity (Unitless) A-Zone Sand B/C-Zone Silt and Clay D-Zone Sand Till Bedrock J:\ National Wildlife Federation\000\Tables 1 thru 6_Sx

15 TABLE 2 FLOW MODEL BOUNDARY CONDITION SUMMARY 1 Eagle Mine Review - NWF Marquette County, Michigan Boundary Condition Type Modeled Feature Value Units Conductance 2 Recharge Infiltration of precipitation feet per day NA Infiltration of wastewater at the TWIS to feet per day NA River Salmon Trout River 1297 to 1427 feet 100 General head boundary Yellow Dog River 1150 to 1451 feet 200 Drain Seeps and springs 1230 to 1290 feet 50 to 75 Mine inflow 1250 feet 10.8 to 50 Notes: 1. Modeled infiltration rates at the TWIS and conductance values for the mine inflow are for the 75 gallon per mintue (gpm) and 250 gpm mine inflow predictive cases. 2. Conductance values are in units of square feet per day (ft 2 /day). J:\ National Wildlife Federation\000\Tables 1 thru 6_Sx

16 TABLE 3 FLOW MODEL CALIBRATION STATISTICS Eagle Mine Review - NWF Marquette County, Michigan Statistic Value Units Mean error 0.60 feet Root mean square error 13.9 feet Range in target values 98.6 feet % Root mean square error 14.1 % J:\ National Wildlife Federation\000\Tables 1 thru 6_Sx

17 TABLE 4 PREDICTIVE MODEL RESULTS - DRAWDOWN 1 Eagle Mine Review - NWF Marquette County, Michigan Maximum Drawdown (Feet) Areal Extent of Drawdown > 0.5 Feet Modeled Scenario Fletcher Driscoll Geomatrix Fletcher Driscoll Geomatrix Scenario 1-75-gpm Mine Inflow No drawdown > 0.5 ft An area approximately 4,800 ft east-west by 5,400 ft north-south, centered over the ore body Scenario gpm Mine Inflow Approximately 3,500-ft diameter centered on the ore body Approximately 10,000-ft diameter centered on the ore body Notes: 1. gpm = gallons per minute; ft = feet. 2. Fletcher Driscoll used an average mine inflow rate of approximately 230 gpm. WHPA used a mine inflow rate of 250 gpm. J:\ National Wildlife Federation\000\Tables 1 thru 6_Sx

18 TABLE 5 PREDICTIVE MODEL RESULTS - SALMON TROUT RIVER FLOWS 1 Eagle Mine Review - NWF Marquette County, Michigan Modeled Surface Water Flow (cfs) Change from Existing Conditions (cfs) 2 Modeled Scenario Stream Location Fletcher Driscoll Geomatrix Fletcher Driscoll Geomatrix Existing Conditions - No Mine Inflow Scenario 1-75-gpm Mine Inflow Scenario gpm Mine Inflow 3 At the ore body NA NA Gauge STRM NA NA At the terrace escarpment NA NA At the ore body Gauge STRM At the terrace escarpment At the ore body Gauge STRM At the terrace escarpment Notes: 1. cfs = cubic feet per second; gpm = gallons per minute. 2. Negative value indicates a decrease in predicted surface water flow. 3. Fletcher Driscoll used an average mine inflow rate of approximately 230 gpm. WHPA used a mine inflow rate of 250 gpm. J:\ National Wildlife Federation\000\Tables 1 thru 6_Sx

19 TABLE 6 PREDICTIVE MODEL RESULTS - TWIS MOUNDING AND GROUNDWATER TRAVEL TIMES 1 Eagle Mine Review - NWF Marquette County, Michigan Maximum Mounding (Feet) Travel Time (Years) Modeled Scenario Fletcher Driscoll Geomatrix Fletcher Driscoll Geomatrix Scenario 1-75-gpm Mine Inflow to 10 4 to 6 Scenario gpm Mine Inflow Less than 5 to less than 10 2 to 6 Notes: 1. gpm = gallons per minute. 2. Fletcher Driscoll used an average mine inflow rate of approximately 230 gpm. WHPA used a mine inflow rate of 250 gpm. J:\ National Wildlife Federation\000\Tables 1 thru 6_Sx

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