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1039-00003 · Torchlight Mining Corp · Supplemental Environmental Projects
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SUPPLEMENTAL ENVIRONMENTAL PROJECT DESCRIPTION AND BUDGET

FLINT CREEK WATERSHED RESTORATION PROJECT

(SEP No. 1)

January 28, 2025

Prepared by:

Calderwood & Harkness LLP Matter No. 1039-00003

Prepared on behalf of:

Torchlight Mining Corp. Torchlight Mining (U.S.) Inc. Ridgecrest Mine Holdings, LLC

In connection with:

Consent Decree, Civil Action No. 9:24-cv-00087-DWM United States of America and State of Montana v. Torchlight Mining Corp. et al. U.S. District Court for the District of Montana, Missoula Division

For submission to:

U.S. Environmental Protection Agency (EPA), Office of Enforcement and Compliance Assurance (OECA)

U.S. Department of Justice, Environment and Natural Resources Division (ENRD)

Montana Department of Environmental Quality (MT DEQ)

Classification: Appendix to Consent Decree — SEP No. 1

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I. INTRODUCTION AND REGULATORY BACKGROUND

1.1 Purpose of this Document

This document sets forth the description, scope of work, implementation schedule, budget, and reporting requirements for the Flint Creek Watershed Restoration Project (the "Project" or "SEP-1"), a supplemental environmental project to be implemented by Torchlight Mining Corp. ("TMC") pursuant to the Consent Decree entered in Civil Action No. 9:24-cv-00087-DWM, United States of America and State of Montana v. Torchlight Mining Corp. et al., in the United States District Court for the District of Montana, Missoula Division (the "Consent Decree").

The Project is one of three supplemental environmental projects required under the Consent Decree. The total SEP commitment across all three projects is Twelve Million Dollars ($12,000,000.00). The Flint Creek Watershed Restoration Project constitutes the largest single SEP and carries a total budget of Five Million Five Hundred Thousand Dollars ($5,500,000.00), representing approximately forty-six percent (46%) of the total SEP commitment.

This document is intended to provide EPA, DOJ, MT DEQ, the Court, and the public with a comprehensive and transparent description of the Project, including its environmental and public health benefits, the specific tasks to be performed, the schedule for implementation, the detailed budget and budget controls, the reporting and certification requirements, and the stipulated penalties applicable in the event of non-compliance. This document is submitted as an Appendix to the Consent Decree and, upon entry of the Consent Decree by the Court, shall become an enforceable component thereof.

1.2 Consent Decree Context

The Consent Decree resolves claims brought by the United States of America and the State of Montana, along with co-plaintiffs the State of Nevada and the State of West Virginia, against TMC and its affiliated entities. The case was filed on January 18, 2024, in the United States District Court for the District of Montana, Missoula Division, and was assigned to the Honorable Donald W. Molloy, Senior United States District Judge, under Civil Action No. 9:24-cv-00087-DWM.

The named Defendants in the action are:

• Torchlight Mining Corp. (parent entity; incorporated in British Columbia, Canada);

• Torchlight Mining (U.S.) Inc. (Delaware corporation; U.S. holding company);

• Torchlight Specialty Chemicals, Inc. (Delaware corporation; chemical processing subsidiary);

• Ridgecrest Mine Holdings, LLC (Montana limited liability company; MT Secretary of State ID E1042738; owner and operator of the Ridgecrest Copper-Molybdenum Mine); and

• Bonanza Creek Mining, LLC (Nevada limited liability company; owner and operator of the Bonanza Creek gold mine in Humboldt County, Nevada).

The Consent Decree was lodged with the Court on February 19, 2025, and is subject to a thirty (30) day public comment period closing on March 21, 2025, in accordance with 28 C.F.R. § 50.7 and the procedural requirements of the Comprehensive Environmental Response, Compensation, and Liability Act ("CERCLA"), 42 U.S.C. § 9622(d)(2). Following the close of the public comment period and consideration of any comments received, the United States will move the Court for entry of the Consent Decree.

The Consent Decree addresses alleged violations of three principal federal environmental statutes at four TMC-operated or formerly operated facilities in Montana, Nevada, and West Virginia:

1. The Federal Water Pollution Control Act, as amended (the "Clean Water Act" or "CWA"), 33 U.S.C. §§ 1251–1387;

2. The Resource Conservation and Recovery Act ("RCRA"), as amended, 42 U.S.C. §§ 6901–6992k; and

3. The Comprehensive Environmental Response, Compensation, and Liability Act ("CERCLA"), as amended, 42 U.S.C. §§ 9601–9675.

The four facilities at issue are: (i) the Ridgecrest Copper-Molybdenum Mine in Granite County, Montana; (ii) the Bonanza Creek Gold Mine in Humboldt County, Nevada; (iii) the Torchlight Chemical Processing Facility in Kanawha County, West Virginia; and (iv) a formerly operated lead-zinc mine in Mineral County, West Virginia.

1.3 Relationship to the Ridgecrest Site

The Ridgecrest Copper-Molybdenum Mine (the "Ridgecrest Mine" or the "Ridgecrest Site") is located at 14200 Ridgecrest Mine Road, Drummond, Granite County, Montana 59832. The Site is situated in the upper Flint Creek drainage basin in the Flint Creek Range of the Northern Rocky Mountains, at an elevation ranging from approximately 5,200 feet to 7,400 feet above mean sea level.

The Ridgecrest Site encompasses a total mine footprint of approximately 3,200 acres, including the open pit, waste rock dumps, tailings impoundment, mill site, water treatment facilities, haul roads, and ancillary infrastructure. The total controlled property, including undisturbed buffer lands, encompasses approximately 8,700 acres, all of which is held in fee by Ridgecrest Mine Holdings, LLC.

Ridgecrest Mine Holdings, LLC is a Montana limited liability company (MT Secretary of State ID E1042738) and is a wholly owned subsidiary of Torchlight Mining (U.S.) Inc., the Delaware-incorporated U.S. holding company of Torchlight Mining Corp.

Operational History. The Ridgecrest Mine operated as an open-pit copper-molybdenum mine from 1978 through December 31, 2019, when active mining operations ceased. During its operational life, the mine produced approximately 1.8 billion pounds of copper and 120 million pounds of molybdenum. The site is currently in the closure and reclamation phase under an approved Closure Plan filed with the Montana Department of Environmental Quality and the Montana Department of Natural Resources and Conservation, Hard Rock Mining Bureau.

Principal Environmental Issues. The principal environmental concern at the Ridgecrest Site is acid mine drainage ("AMD") emanating from exposed pit walls, waste rock dumps, and the 425-acre tailings impoundment. Water quality monitoring data collected by EPA, MT DEQ, and TMC over the period 2019–2024 documents the following average constituent concentrations in untreated AMD discharges from the Ridgecrest Site:

In addition, the 425-acre tailings impoundment has documented seepage to Flint Creek via subsurface pathways. Seepage monitoring wells installed downgradient of the tailings impoundment have consistently shown elevated copper, molybdenum, and sulfate concentrations above background levels and applicable water quality standards.

Alleged Violations. The complaint and Consent Decree allege the following violations at the Ridgecrest Site:

• Clean Water Act § 301, 33 U.S.C. § 1311: unpermitted discharges of pollutants from the Ridgecrest Site to Flint Creek, a water of the United States, without a valid National Pollutant Discharge Elimination System ("NPDES") permit, and discharges in violation of the terms of NPDES Permit No. MT0031445 during the periods when such permit was in effect;

• RCRA § 3004, 42 U.S.C. § 6924: mismanagement of hazardous waste, including the disposal of waste containing elevated levels of arsenic, cadmium, and lead in unlined waste rock dumps, in violation of RCRA land disposal restrictions and hazardous waste management standards; and

• CERCLA § 107, 42 U.S.C. § 9607: cost recovery for $14.3 million in EPA removal actions conducted at the Ridgecrest Site between 2021 and 2023, including emergency stabilization of seepage from the tailings impoundment and construction of temporary water treatment infrastructure.

Negotiated Remediation Cost. The Consent Decree establishes a negotiated remediation cost for the Ridgecrest Site of One Hundred Ninety-Eight Million Six Hundred Thousand Dollars ($198,600,000.00), to be expended by TMC over a thirty (30) year period. The net present value of this remediation obligation, calculated at a discount rate of three percent (3%), is approximately One Hundred Thirty-Four Million Nine Hundred Thousand Dollars ($134,900,000.00). The Ridgecrest Site remediation includes, among other components, construction of a permanent water treatment plant, closure and capping of the tailings impoundment, removal and consolidation of contaminated waste rock, and long-term water quality monitoring.

Civil Penalty. The civil penalty allocated to the Ridgecrest Site under the Consent Decree is Fourteen Million Two Hundred Thousand Dollars ($14,200,000.00), out of a total civil penalty across all four sites of Thirty-One Million Five Hundred Thousand Dollars ($31,500,000.00).

1.4 EPA SEP Policy Compliance

The Project has been developed in compliance with the U.S. Environmental Protection Agency's Supplemental Environmental Projects Policy (last updated 2015) and applicable guidance issued by EPA's Office of Enforcement and Compliance Assurance. Under EPA's SEP Policy, a supplemental environmental project must satisfy several criteria, each of which is addressed below.

Nexus Requirement. The Project directly addresses environmental harm to Flint Creek and its watershed caused by historical mining discharges from the Ridgecrest Site. The Project area — a 12-mile segment of Flint Creek immediately downstream of the Ridgecrest Mine — has been directly impacted by decades of acid mine drainage, tailings seepage, and associated hydrologic and geomorphic disturbance. The ecological degradation targeted by the Project is a direct consequence of the same mining activities that gave rise to the alleged violations addressed in the Consent Decree.

Not Otherwise Required. The Project is not otherwise legally required by any federal, state, or local law, regulation, permit, order, or agreement. The Project is not part of the negotiated remediation obligations under the Consent Decree, which address source control and treatment at the Ridgecrest Site itself. The Project addresses downstream ecological impacts that are beyond the scope of the required remediation. TMC has no independent legal obligation to undertake stream restoration, riparian replanting, or fish-passage improvements along Flint Creek.

Environmental and Public Health Benefits. The Project provides environmental and public health benefits beyond those that would be achieved through compliance with applicable law alone. Specifically, the Project will restore degraded stream habitat, re-establish native riparian vegetation, remove barriers to fish passage for native westslope cutthroat trout and other aquatic species, and reduce sedimentation and contaminant mobilization in Flint Creek. These benefits will enhance the ecological recovery of the watershed and provide tangible improvements in water quality, aquatic habitat, and recreational opportunities for downstream communities.

Appropriate SEP Category. The Project falls within the "Environmental Restoration and Protection" category of SEPs as defined in EPA's SEP Policy, which encompasses projects that prevent or reduce pollution or environmental degradation, or that restore a natural resource that has been adversely affected by the defendant's violations.

II. PROJECT DESCRIPTION

2.1 Project Overview

Project Name: Flint Creek Watershed Restoration Project

Project Location: The Project is located along a twelve (12) mile segment of Flint Creek downstream of the Ridgecrest Copper-Molybdenum Mine site, in Granite County, Montana. The project reach begins at the Ridgecrest Mine property boundary (approximately 46.6721° N, 113.1543° W) and extends downstream to the confluence with an unnamed tributary approximately 12 miles south-southwest of the mine site (approximately 46.5384° N, 113.2017° W). The project reach traverses a mix of public land administered by the Bureau of Land Management, Butte Field Office, and private ranchlands.

General Description: The Project is a comprehensive watershed restoration initiative consisting of three integrated components:

1. Stream-Bank Stabilization: Survey, design, and installation of bioengineered bank stabilization structures at twenty-eight (28) identified erosion sites along the project reach, encompassing approximately 18,000 linear feet of treated bank;

2. Riparian Replanting: Planting of approximately 45,000 native riparian plants (willows, cottonwoods, alders, native grasses, and forbs) along restored bank segments, establishing riparian buffer zones averaging 50 feet in width on each side of the channel across approximately 145 acres; and

3. Fish-Passage Improvements: Removal or replacement of three (3) undersized or perched culverts and modification of two (2) low-head diversion structures to restore aquatic connectivity for native fish species, including westslope cutthroat trout (Oncorhynchus clarkii lewisi).

Total Budget: Five Million Five Hundred Thousand Dollars ($5,500,000.00).

Implementation Period: The Project is anticipated to be implemented over a period of four (4) years from the Effective Date of the Consent Decree. The target Effective Date of the Consent Decree is June 14, 2025, which would result in a Project completion date of approximately June 14, 2029.

Beneficiaries: The primary beneficiaries of the Project include the aquatic ecosystems of Flint Creek, native fish populations (particularly westslope cutthroat trout), riparian and upland wildlife, downstream communities that rely on Flint Creek for agricultural water supply and recreation, and recreational users of Flint Creek and surrounding public lands.

2.2 Environmental and Community Context

Flint Creek is a tributary of the Clark Fork River and flows generally southward through Granite County, Montana, downstream of the Ridgecrest Mine site. The Flint Creek watershed drains approximately 490 square miles and supports a diverse assemblage of native fish, macroinvertebrate, and wildlife species. Flint Creek is classified as a B-1 water body under Montana's water quality standards, with designated beneficial uses that include drinking water supply, aquatic life (both cold water and warm water), agriculture, industrial water supply, and primary contact recreation.

Historical acid mine drainage and tailings seepage from the Ridgecrest Mine have significantly degraded water quality and aquatic habitat along the twelve-mile project reach. Water quality monitoring data from Montana DEQ and the U.S. Geological Survey indicate that dissolved copper concentrations in Flint Creek downstream of the Ridgecrest Site have frequently exceeded Montana's chronic aquatic life standard of 0.0087 mg/L by factors ranging from approximately ten to fifty times, depending on flow conditions and seasonal variability. Elevated concentrations of molybdenum, selenium, and sulfate have also been documented throughout the project reach.

These elevated contaminant concentrations have impaired fish populations and benthic macroinvertebrate communities within the project reach. Fisheries surveys conducted by Montana Fish, Wildlife & Parks ("MT FWP") between 2018 and 2023 have documented severely reduced densities of westslope cutthroat trout in the project reach compared to reference reaches upstream and on unaffected tributaries. Benthic macroinvertebrate assessments have shown reduced taxonomic diversity and shifts in community composition toward pollution-tolerant taxa, consistent with metals-impaired conditions.

Eroded stream banks along the project reach exacerbate sedimentation and contaminant mobilization. Bank erosion is a significant source of fine sediment to Flint Creek, which degrades spawning habitat for trout and other lithophilic spawners and increases turbidity levels that impair aquatic organism feeding and respiration. In addition, eroding banks expose and mobilize contaminated soils and sediments that have accumulated metals from historical mine discharges.

Degraded riparian corridors along the project reach reduce shade, increase water temperature, and diminish habitat for native species. Riparian vegetation has been lost or degraded along much of the project reach as a result of a combination of factors, including mine-related land disturbance, altered hydrology from mine dewatering activities, historical livestock grazing, and natural bank erosion processes accelerated by upstream hydrologic changes. The loss of riparian shade has contributed to elevated summer water temperatures that approach or exceed Montana's temperature standard for cold-water fisheries.

Three aging culverts and two low-head diversion structures currently block or impede fish passage along the twelve-mile project reach. These barriers fragment aquatic habitat, prevent native fish from accessing upstream spawning and rearing habitats, and isolate fish populations, increasing their vulnerability to local extirpation. MT FWP has identified these five barriers as high-priority targets for remediation under the state's fish passage improvement program.

2.3 Project Goals and Objectives

The Project is designed to achieve the following goals and objectives:

Goal 1: Stream-Bank Stabilization. Stabilize and restore approximately twelve (12) miles of eroded stream-bank along Flint Creek. This goal will be achieved through the design and installation of bioengineered bank stabilization structures at twenty-eight (28) identified erosion sites, treating approximately 18,000 linear feet of bank.

Goal 2: Riparian Replanting. Re-establish native riparian vegetation along restored stream-bank segments. This goal will be achieved through the planting of approximately 45,000 native plants across approximately 145 acres of riparian buffer zones averaging 50 feet in width on each side of the channel, with a target survival rate of eighty percent (80%) at the end of a three-year post-planting maintenance period.

Goal 3: Fish-Passage Restoration. Remove or modify fish-passage barriers to restore aquatic connectivity for native fish species, including westslope cutthroat trout. This goal will be achieved through the replacement of three (3) undersized or perched culverts with bottomless arch culverts or bridges and the modification of two (2) low-head diversion structures with fish-friendly diversion screens and step-pool bypass channels.

Goal 4: Sedimentation Reduction and Habitat Improvement. Reduce sedimentation and improve in-stream habitat quality within the project reach. This goal will be achieved as a direct result of stream-bank stabilization, riparian replanting, and channel recontouring activities, which will collectively reduce fine sediment inputs, increase habitat complexity (pools, riffles, and cover), and improve substrate conditions for spawning and benthic invertebrate production.

Goal 5: Long-Term Ecological Complementarity. Provide long-term ecological benefits that complement the Ridgecrest Site remediation being conducted under the Consent Decree. While the Ridgecrest remediation addresses contaminant source control and treatment at the mine site itself, the Project addresses downstream ecological impacts that are not encompassed by the remediation obligations. Together, the source-control remediation and the downstream watershed restoration will provide a comprehensive approach to recovering the ecological integrity of Flint Creek and its tributaries.

III. SCOPE OF WORK

3.1 Component 1: Stream-Bank Stabilization

Component 1 encompasses the survey, design, and construction of stream-bank stabilization improvements along the twelve-mile project reach of Flint Creek. The scope of work for this component is as follows:

Survey and Geomorphic Assessment. A detailed geomorphic assessment of the twelve-mile Flint Creek channel and banks will be conducted to characterize existing conditions, identify and prioritize erosion sites, and inform engineering design. The assessment will include topographic surveying using high-resolution GPS and LiDAR data, cross-sectional surveys at representative locations, longitudinal profile surveys, substrate characterization, and geomorphic classification of channel reaches using the Rosgen classification system. The assessment will also include an evaluation of hydrologic and hydraulic conditions, including analysis of flow frequency, bankfull discharge, and shear stress at identified erosion sites.

Design and Installation of Bioengineered Bank Stabilization Structures. Based on the geomorphic assessment, bioengineered bank stabilization structures will be designed and installed at approximately twenty-eight (28) identified erosion sites along the project reach. Treatment types will be selected based on site-specific conditions and may include, but are not limited to, the following techniques:

• Rock barbs (J-hook vanes and cross-vanes) to redirect flow energy away from eroding banks;

• Root wad revetments to provide bank stabilization, habitat complexity, and cover for fish;

• Coir (coconut fiber) logs to stabilize banks and promote sediment deposition and revegetation;

• Vegetated geogrids (soil lifts) to rebuild and stabilize severely eroded bank profiles;

• Brush layering and live staking with native willow and cottonwood cuttings;

• Riprap and rock toe protection at high-energy meander bends where bioengineered techniques alone are insufficient; and

• Channel recontouring and bank lay-back to reduce bank angles and restore natural channel geometry.

Grading and Recontouring. At severely eroded sites, grading and recontouring of banks will be performed to restore natural channel geometry and reduce bank height and angle to stable configurations. Recontouring will be designed to mimic natural bank profiles and facilitate establishment of riparian vegetation.

Rock Toe Protection. At high-energy meander bends where flow velocities and shear stress are greatest, rock toe protection will be installed to prevent undercutting and lateral migration of the channel. Rock toe protection will consist of appropriately sized and graded native stone placed at the base of the bank and extending to the bankfull elevation.

Estimated Treatment. The total estimated linear footage of bank to be treated under Component 1 is approximately 18,000 linear feet, distributed across both banks at the twenty-eight identified erosion sites. Treatment intensity will vary by site, ranging from approximately 200 linear feet at smaller erosion sites to approximately 1,500 linear feet at the largest sites.

Engineering Design and Review. All designs for Component 1 will be prepared by a licensed professional engineer and will be reviewed by Pinnacle Creek Environmental, LLC. The Senior Principal responsible for design review is Dr. Astrid Bergmann, P.E., whose office is located at 320 Willowbrook Drive, Suite 100, Bozeman, Montana 59715. All designs will comply with applicable federal, state, and local engineering standards and will incorporate best management practices for stream restoration as documented in the Federal Interagency Stream Restoration Working Group's Stream Corridor Restoration: Principles, Processes, and Practices and the Natural Resources Conservation Service's Stream Restoration Design (National Engineering Handbook, Part 654).

3.2 Component 2: Riparian Replanting

Component 2 encompasses the procurement, planting, and post-planting maintenance of native riparian vegetation along restored bank segments within the project reach. The scope of work for this component is as follows:

Plant Stock Procurement. Approximately 45,000 native riparian plants will be procured for planting along the project reach. Plant stock will consist of native willows (Salix spp.), cottonwoods (Populus trichocarpa and P. balsamifera), alders (Alnus incana), native grasses (including Deschampsia cespitosa, Elymus trachycaulus, Poa palustris), and native forbs (including Carex spp., Juncus spp., and other wetland-associated herbaceous species). A complete proposed native plant species list is set forth in Appendix D.

All plant stock will be sourced locally from nurseries within Montana or adjacent states that specialize in genetically appropriate native plant materials for the Northern Rocky Mountain region. Source populations will be selected to match the elevation, latitude, and habitat conditions of the project reach to ensure maximum survival and establishment success.

Riparian Buffer Zones. Riparian buffer zones averaging fifty (50) feet in width will be established on each side of the channel along restored bank segments. In some locations where topography and land ownership permit, buffer zones may be expanded beyond fifty feet to maximize ecological benefit. The total riparian area to be planted under Component 2 is approximately 145 acres.

Planting Methods. Planting methods will be tailored to site conditions and species requirements and may include containerized plantings, bare-root plantings, live stakes (dormant willow and cottonwood cuttings), brush layering, and broadcast seeding of native grass and forb mixes. Planting densities will be designed to achieve rapid canopy closure and functional riparian cover, consistent with natural reference conditions along unimpaired reaches of Flint Creek.

Browse Protection. Temporary browse protection will be installed to protect newly planted vegetation from browsing by deer, elk, and livestock. Browse protection will consist of wildlife-friendly fencing (e.g., post-and-wire exclosures) designed to exclude ungulate browsing while allowing passage of small wildlife. Fencing will be maintained throughout the three-year post-planting maintenance period and removed upon demonstration of adequate vegetation establishment and resilience.

Weed Control. Pre-planting weed control will be implemented to reduce competition from invasive and noxious weed species, including spotted knapweed (Centaurea stoebe), leafy spurge (Euphorbia esula), and Canada thistle (Cirsium arvense). Weed control measures may include mechanical removal, targeted herbicide application (using approved herbicides and methods consistent with proximity to waters of the United States), and competitive plantings of aggressive native species.

Post-Planting Maintenance. A three-year post-planting maintenance period will be implemented to maximize vegetation survival and establishment. Maintenance activities will include supplemental watering during the first growing season (Year 1 post-planting), replanting of failed stock to maintain target planting densities, continued invasive species management, and maintenance of browse protection fencing. The target survival rate at the end of the three-year maintenance period is eighty percent (80%).

3.3 Component 3: Fish-Passage Improvements

Component 3 encompasses the removal, replacement, or modification of five (5) fish-passage barriers along the project reach to restore aquatic connectivity for native fish species. The scope of work for this component is as follows:

Culvert Replacement. Three (3) undersized and/or perched culverts along the project reach will be removed and replaced with bottomless arch culverts or bridges. Each replacement structure will be designed to pass the 100-year recurrence interval flood flow while maintaining a natural stream substrate within the structure to accommodate aquatic organism passage ("AOP"). Design criteria for culvert replacement structures will include:

• Span width equal to or exceeding 1.2 times the bankfull channel width;

• Natural substrate placement within the structure at a depth sufficient to simulate natural streambed conditions;

• Hydraulic conditions within the structure that maintain water depths and velocities suitable for passage of all life stages of native fish species (adult, juvenile, and fry);

• Structural capacity to support applicable highway or road loading, as appropriate to the specific crossing location; and

• Compliance with Montana Fish, Wildlife & Parks AOP design standards and the U.S. Army Corps of Engineers Nationwide Permit conditions.

Diversion Structure Modification. Two (2) low-head diversion structures along the project reach will be modified to provide fish passage while maintaining the irrigation diversion function for downstream agricultural users. Modifications will include:

• Installation of fish-friendly diversion screens compliant with the National Marine Fisheries Service ("NMFS") screen criteria (maximum approach velocity, screen mesh size, and sweeping velocity requirements), adapted for the species of concern (westslope cutthroat trout and other native salmonids);

• Construction of step-pool bypass channels adjacent to each diversion structure, designed to provide passage for upstream and downstream movement of all life stages of native fish; and

• Modification of the diversion structure crest and downstream apron, as necessary, to reduce the hydraulic drop and create passage-friendly hydraulic conditions.

Species Coordination. Design and construction of all fish-passage improvements will be coordinated with Montana Fish, Wildlife & Parks and the U.S. Fish and Wildlife Service ("USFWS") to ensure that native fish species considerations, particularly those related to westslope cutthroat trout, are fully addressed. Westslope cutthroat trout is a Montana Species of Concern and a candidate for federal listing under the Endangered Species Act. Coordination will include consultation on design criteria, construction timing windows to avoid spawning periods, and post-construction monitoring protocols.

Design Criteria. All fish-passage improvement designs will comply with the following standards and guidelines:

• Montana Fish, Wildlife & Parks, Fish Passage Guidelines for Montana (current edition);

• U.S. Army Corps of Engineers, Section 404 permit conditions and Nationwide Permit 14 (Linear Transportation Projects) or Individual Permit requirements, as applicable;

• Montana Department of Transportation, Drainage Manual (for road-crossing structures); and

• USFWS and NMFS, Design of Road Culverts for Fish Passage (Federal Highway Administration, 2007).

3.4 Permits and Approvals

Implementation of the Project will require the following permits, approvals, and agreements, which TMC will obtain or cause to be obtained prior to commencement of construction activities:

Section 404 Permit (Clean Water Act). A permit under Section 404 of the Clean Water Act, 33 U.S.C. § 1344, will be obtained from the U.S. Army Corps of Engineers, Omaha District (Montana Regulatory Office), for all in-stream and bank work that involves the discharge of dredged or fill material into waters of the United States. Depending on the scope and impact of the work, authorization may be obtained under one or more Nationwide Permits (e.g., NWP 13 — Bank Stabilization; NWP 14 — Linear Transportation Projects; NWP 27 — Aquatic Habitat Restoration, Enhancement, and Establishment Activities) or, if necessary, through an Individual Permit.

Montana Stream Protection Act (SPA 124) Permit. A permit under the Montana Stream Protection Act, Montana Code Annotated § 87-5-501 et seq. (SPA 124), will be obtained from Montana Fish, Wildlife & Parks for any project activities that may obstruct, damage, or modify the natural existing shape and form of any stream or its banks or tributaries.

Floodplain Development Permit. A floodplain development permit will be obtained from Granite County for any project activities located within the regulatory floodplain of Flint Creek, as delineated on the effective Federal Emergency Management Agency ("FEMA") Flood Insurance Rate Maps for Granite County.

Montana DEQ Section 401 Water Quality Certification. A Section 401 Water Quality Certification will be obtained from the Montana Department of Environmental Quality for any project activities requiring a federal Section 404 permit, certifying that the proposed activities will not violate Montana's water quality standards.

Right-of-Way and Easement Agreements. TMC will negotiate and execute any required right-of-way or easement agreements with private landowners whose property is located along the project reach and whose consent is necessary for access to and performance of project activities on their lands. TMC will use commercially reasonable efforts to obtain all necessary access rights on terms consistent with fair market value.

Permitting Coordination. TMC will coordinate with Holcroft, Dane & Weiss LLP (local counsel, Montana) on all permitting matters. Russell Dane, Lead Partner, at 45 North Last Chance Gulch, Suite 600, Helena, Montana 59601, will serve as lead local counsel for permitting coordination.

IV. IMPLEMENTATION SCHEDULE

4.1 Phase 1: Planning, Design, and Permitting (Months 1–12 from Effective Date)

Phase 1 encompasses all pre-construction planning, design, and permitting activities. The anticipated Effective Date of the Consent Decree is June 14, 2025, and Phase 1 will accordingly extend from approximately June 14, 2025, through June 14, 2026. Phase 1 activities are organized into the following sub-phases:

Months 1–3 (June 14, 2025 – September 14, 2025): Site Assessment and Baseline Surveys. During the first three months, TMC and its environmental consultant, Pinnacle Creek Environmental, LLC, will conduct detailed site assessments, including topographic and geomorphic surveys, hydrologic and hydraulic analyses, and biological baseline surveys. Biological baseline surveys will include fisheries assessments (electrofishing surveys, population estimates for westslope cutthroat trout and other native species), benthic macroinvertebrate sampling, riparian vegetation assessments, and water quality sampling. These baseline data will serve as the basis for engineering design and as reference conditions for post-construction monitoring and assessment of project effectiveness.

Months 3–6 (September 14, 2025 – December 14, 2025): Preliminary Engineering Design (30% Design). Preliminary engineering designs (30% design level) will be developed for all three project components: stream-bank stabilization, riparian replanting, and fish-passage improvements. The 30% design will include plan-view drawings, typical cross-sections, preliminary hydraulic analyses, preliminary quantities, and conceptual construction sequencing. During this period, TMC will initiate coordination with MT DEQ (through Annika Hedstrom, Assistant Attorney General, Montana Attorney General's Office, Environmental Bureau), Montana Fish, Wildlife & Parks, and the U.S. Army Corps of Engineers to present preliminary designs, solicit feedback, and identify any design modifications necessary to satisfy regulatory requirements and agency preferences.

Months 6–9 (December 14, 2025 – March 14, 2026): Final Engineering Design (100% Design) and Permit Applications. Final engineering designs (100% design level) will be completed for all three project components, incorporating comments and feedback received from regulatory agencies during the preliminary design review. Final designs will include detailed construction drawings, technical specifications, quantities and cost estimates, construction sequencing plans, erosion and sediment control plans, and dewatering plans for in-stream work. Permit applications for the Section 404 permit, SPA 124 permit, floodplain development permit, and Section 401 Water Quality Certification will be prepared and submitted to the respective issuing agencies during this period.

Months 9–12 (March 14, 2026 – June 14, 2026): Permit Acquisition and Pre-Construction Activities. TMC will work with regulatory agencies to complete permit review and obtain all required permits and approvals. Concurrently, TMC will finalize landowner coordination and execute easement agreements with private landowners along the project reach. Materials procurement, including ordering of rock, bioengineering materials, and native plant stock, will be initiated. Contractor procurement will be completed through a competitive bidding process. Pre-construction meetings with contractors, regulatory agencies, and the independent monitor will be conducted.

Phase 1 Milestone: Complete design and permitting by approximately June 14, 2026 (twelve (12) months from the Effective Date).

4.2 Phase 2: Construction — Stream-Bank Stabilization and Fish-Passage Improvements (Months 13–30)

Phase 2 encompasses the construction of stream-bank stabilization structures and fish-passage improvements. Construction activities will be scheduled to occur during in-stream work windows, which are typically limited to July 1 through September 30 in Montana to minimize impacts to spawning fish and to take advantage of low-flow conditions that facilitate in-stream construction.

Year 2 Construction Season (Summer 2026; approximately July 2026 – September 2026). During the first construction season, stream-bank stabilization work will be performed at approximately fourteen (14) of the twenty-eight (28) identified erosion sites. These fourteen sites will be selected to include the highest-priority erosion sites based on severity, proximity to fish-passage barriers, and accessibility. Concurrently, two (2) of the three (3) culverts will be removed and replaced with bottomless arch culverts or bridges. Construction will be sequenced to minimize in-stream disturbance, with erosion and sediment control best management practices implemented and maintained throughout the construction period.

Year 3 Construction Season (Summer 2027; approximately July 2027 – September 2027). During the second construction season, stream-bank stabilization work will be completed at the remaining fourteen (14) erosion sites. The third and final culvert will be removed and replaced. The two (2) low-head diversion structures will be modified with fish-friendly diversion screens and step-pool bypass channels. Final grading and recontouring of all treated bank segments will be completed, and temporary erosion control measures will be converted to permanent installations where appropriate.

Phase 2 Milestone: Complete all in-stream construction by approximately December 14, 2027 (thirty (30) months from the Effective Date).

4.3 Phase 3: Riparian Replanting (Months 13–36)

Phase 3 encompasses the riparian replanting activities, which will be performed during spring planting windows (typically April through June in Montana) and will overlap with the construction phases.

Year 2 Spring (April – June 2026). Planting will be performed at the first set of restored bank segments, corresponding to the fourteen erosion sites where stream-bank stabilization will be performed during the Year 2 construction season. Approximately 22,000 native riparian plants will be installed during this planting cycle. Where bank stabilization work has not yet been completed at the time of planting (i.e., at sites where construction is scheduled for the summer 2026 construction season), planting will be limited to upland and upper bank areas that will not be disturbed by subsequent construction activities. Browse protection (wildlife fencing) will be installed concurrently with planting.

Year 3 Spring (April – June 2027). Planting will be performed at the remaining restored bank segments, corresponding to the fourteen erosion sites where stream-bank stabilization will be performed during the Year 3 construction season. Approximately 23,000 native riparian plants will be installed during this planting cycle. Browse protection will be installed concurrently.

Phase 3 Milestone: Complete all planting by approximately June 14, 2028 (thirty-six (36) months from the Effective Date).

4.4 Phase 4: Post-Construction Monitoring and Maintenance (Months 31–48)

Phase 4 encompasses the three-year post-planting maintenance period and ongoing monitoring of all project components. The post-planting maintenance period will extend through approximately June 14, 2029, which is also the anticipated date for Project completion and submission of the final SEP Completion Report.

Annual Monitoring. Annual monitoring surveys will be conducted during the post-construction period (and commencing in the first year of construction) to assess:

• Bank stability at all treated erosion sites, including visual inspections, photo-documentation, and repeat cross-sectional surveys;

• Vegetation survival and establishment rates for all planted riparian vegetation, including species-level survival counts, canopy cover measurements, and assessment of plant vigor;

• Fish-passage functionality at all replaced culverts and modified diversion structures, including hydraulic measurements and observational or electrofishing surveys to confirm fish passage utilization; and

• Water quality at established monitoring stations upstream and downstream of the project reach, including analysis of dissolved metals (copper, molybdenum, selenium), sulfate, suspended sediment, turbidity, and temperature.

Adaptive Management. Adaptive management measures will be implemented as necessary based on monitoring results. Specific adaptive management triggers and responses include:

• Replanting of failed vegetation in areas where survival rates fall below eighty percent (80%) at the end of any monitoring year during the three-year maintenance period;

• Repair or reinforcement of erosion-control structures that show signs of failure, displacement, or inadequate performance;

• Adjustment of browse protection measures (e.g., fence repair, expansion of exclosures) in response to observed browsing damage; and

• Additional weed control treatments in areas where invasive species competition is identified as a threat to vegetation establishment.

Phase 4 Milestone: Project completion and final report by approximately June 14, 2029 (forty-eight (48) months — four (4) years — from the Effective Date).

4.5 Summary Milestone Table

The following table summarizes the key milestones for the Project, referenced to the anticipated Effective Date of the Consent Decree (June 14, 2025):

V. BUDGET

5.1 Budget Summary Table

The total budget for the Flint Creek Watershed Restoration Project is Five Million Five Hundred Thousand Dollars ($5,500,000.00), allocated across the following budget categories:

The budget has been developed based on preliminary cost estimates prepared by Pinnacle Creek Environmental, LLC, informed by recent comparable stream restoration projects in western Montana, current unit costs for materials, labor, and equipment in the region, and consultation with regulatory agencies regarding anticipated permitting requirements. Detailed budget breakdowns for each category are provided in Sections 5.2 through 5.7 below.

5.2 Component 1: Stream-Bank Stabilization — Detailed Budget

The geomorphic assessment and survey budget of $120,000 covers detailed field surveying, data collection, geomorphic analysis, and preparation of a comprehensive geomorphic assessment report. The engineering design budget of $180,000 provides for preparation of 30% and 100% design packages for all twenty-eight erosion sites, including plan-view drawings, cross-sections, hydraulic analyses, technical specifications, and quantities. The materials budget of $650,000 reflects current unit costs for rock, bioengineering materials, and related supplies delivered to the project site. The construction labor and equipment budget of $1,300,000 covers two construction seasons of work at twenty-eight sites, including excavation, grading, material placement, and erosion control. The mobilization budget of $100,000 covers initial and interim mobilization, site access improvements, and staging area preparation. A contingency allowance of $50,000 (approximately 2% of the component budget) is included to address unanticipated site conditions or minor scope adjustments.

5.3 Component 2: Riparian Replanting — Detailed Budget

The native plant stock procurement budget of $360,000 covers the purchase and delivery of approximately 45,000 containerized, bare-root, and live-stake native plants from regional nurseries. At an average cost of approximately $8.00 per plant (inclusive of delivery), this budget reflects current market prices for locally sourced, genetically appropriate native plant stock. The site preparation, soil amendments, and planting labor budget of $420,000 covers mechanical and manual site preparation, application of soil amendments (compost, mycorrhizal inoculants), and planting labor over two spring planting seasons. The browse protection budget of $140,000 covers materials and installation of wildlife-friendly fencing at all planting sites. The weed control budget of $100,000 covers pre-planting and post-planting weed management over the three-year maintenance period. The supplemental watering budget of $80,000 covers temporary irrigation infrastructure and water delivery during the first growing season for each planting cycle.

5.4 Component 3: Fish-Passage Improvements — Detailed Budget

The engineering design budget of $150,000 covers hydraulic and structural design for three culvert replacements, two diversion structure modifications, and associated step-pool bypass channels, including hydrologic and hydraulic modeling, structural analysis, and preparation of construction drawings and specifications. The culvert replacement budget of $780,000 covers removal of existing culverts, installation of bottomless arch culverts or bridges (including foundations, wingwalls, and headwalls), substrate placement, and roadway restoration. At an average cost of approximately $260,000 per culvert replacement, this estimate is consistent with recent comparable culvert replacement projects in western Montana. The diversion structure modification budget of $320,000 covers installation of fish-friendly screens, construction of step-pool bypass channels, and modification of existing diversion structures. Mobilization and contingency allowances total $100,000.

5.5 Permitting, Design, and Engineering

This budget category covers costs associated with permitting, baseline environmental surveys, engineering quality assurance, landowner coordination, and regulatory agency coordination that are not otherwise included within the individual component budgets. The permit application fees and processing budget of $45,000 covers filing fees, application preparation costs, and agency review fees for all required permits. The environmental and biological surveys budget of $85,000 covers baseline data collection across all biological and water quality parameters. The engineering design oversight budget of $120,000 covers Pinnacle Creek Environmental's senior-level review and quality assurance of all engineering designs. The landowner coordination budget of $60,000 covers survey, appraisal, legal, and recording costs associated with easement acquisition from private landowners. The regulatory agency coordination budget of $40,000 covers meeting preparation, attendance, and follow-up correspondence with EPA, MT DEQ, MT FWP, U.S. Army Corps of Engineers, and USFWS.

5.6 Post-Construction Monitoring and Maintenance

The annual monitoring budget of $120,000 (approximately $40,000 per year over three years) covers field mobilization, data collection, laboratory analysis, data reduction and reporting, and preparation of annual monitoring reports. The adaptive management budget of $50,000 covers replanting of failed vegetation (estimated at up to 20% of original plantings) and associated labor and materials. The erosion-control structure maintenance budget of $30,000 covers minor repairs and adjustments to bioengineered bank stabilization structures as identified through annual monitoring inspections.

5.7 Project Management and Administration

The TMC internal project management budget of $40,000 covers staff time for Gareth Linford, VP, Environmental Health & Safety, and supporting staff for project oversight, coordination, and internal reporting over the four-year implementation period. The Pinnacle Creek Environmental project management budget of $40,000 covers Dr. Bergmann's and supporting staff's project management responsibilities, including scheduling, subcontractor coordination, and progress reporting. The reporting and documentation budget of $20,000 covers preparation of semi-annual progress reports, annual expenditure reports, and the final SEP Completion Report.

5.8 Budget Controls and Cost Overruns

TMC commits to expend no less than Five Million Five Hundred Thousand Dollars ($5,500,000.00) on the Project. This commitment is a binding obligation under the Consent Decree and is subject to the stipulated penalty provisions set forth in Section VIII of this document.

Any cost savings realized on one or more budget categories shall be reallocated to expand the scope of work within the Project. Specifically, cost savings may be used to: (i) plant additional native riparian vegetation beyond the 45,000 plants currently planned; (ii) treat additional erosion sites beyond the twenty-eight sites currently identified; (iii) expand the width of riparian buffer zones beyond the planned fifty-foot average; or (iv) extend the duration or intensity of post-construction monitoring and maintenance activities. Cost savings shall not be used to reduce the total Project expenditure below $5,500,000.

Cost overruns beyond $5,500,000 shall be borne by TMC without adjustment to the Consent Decree SEP obligation. TMC acknowledges that the $5,500,000 budget represents a minimum expenditure commitment, and that the actual cost of the Project may exceed this amount depending on site conditions, material costs, permitting requirements, and other factors.

VI. ENVIRONMENTAL AND PUBLIC HEALTH BENEFITS

6.1 Ecological Benefits

The Project will provide the following ecological benefits to the Flint Creek watershed:

Stream Habitat Restoration. The Project will restore approximately twelve (12) miles of degraded stream habitat along Flint Creek. Stream-bank stabilization, channel recontouring, and installation of bioengineered structures will increase habitat complexity by creating pools, riffles, and cover features that are essential for native fish species and benthic macroinvertebrate communities. Treated bank segments will provide stable, vegetated banks that contribute organic matter inputs, reduce solar radiation, and create undercut bank habitats valued by trout and other fish species.

Riparian Vegetation Restoration. The Project will re-establish approximately 145 acres of native riparian vegetation along the project reach. Mature riparian corridors provide a wide range of ecological functions, including bank stabilization, sediment filtration, nutrient uptake, flood attenuation, wildlife habitat, and aquatic food web support. The planting of approximately 45,000 native trees, shrubs, grasses, and forbs will accelerate the recovery of functional riparian ecosystems along the degraded reach.

Sedimentation Reduction. Stream-bank stabilization and riparian replanting will significantly reduce the input of fine sediment from eroding banks to Flint Creek. Reduced sedimentation will improve substrate conditions for spawning salmonids, increase interstitial dissolved oxygen in gravels, and improve habitat quality for benthic macroinvertebrates, which serve as the primary food base for native fish populations.

Aquatic Connectivity. The removal or modification of five (5) fish-passage barriers will restore aquatic connectivity along the twelve-mile project reach, reconnecting fragmented habitats and allowing native fish species — particularly westslope cutthroat trout — to access upstream spawning and rearing areas. Improved connectivity will support larger, more genetically diverse fish populations and reduce the vulnerability of isolated populations to local extirpation from stochastic events.

In-Stream Habitat Complexity. The installation of rock barbs, root wads, and other bioengineered structures will increase the diversity of in-stream habitat types, including pools, riffles, runs, and backwater areas. Increased habitat complexity supports greater biological diversity and productivity at all trophic levels.

Water Temperature Reduction. The re-establishment of riparian vegetation along the project reach will provide increased shading of the stream surface, reducing solar heating and lowering summer water temperatures. Reduced water temperatures will benefit cold-water-dependent species such as westslope cutthroat trout and bull trout, and will improve dissolved oxygen levels during the critical summer low-flow period.

6.2 Public Health and Community Benefits

The Project will provide the following public health and community benefits:

Improved Water Quality. Reduction of sediment loading, bank erosion, and contaminant mobilization along the project reach will improve water quality in Flint Creek for downstream users, including agricultural irrigators, municipal water supply intakes, and recreational users. While the primary source-control and water treatment obligations at the Ridgecrest Site are addressed by the Consent Decree remediation, the Project provides complementary downstream benefits by reducing secondary sources of water quality impairment associated with bank erosion and sediment mobilization.

Enhanced Recreational Opportunities. Flint Creek supports recreational fishing, wildlife observation, and other outdoor recreation activities that contribute to the quality of life and economic well-being of Granite County residents and visitors. Restoration of fish populations, riparian habitats, and water quality along the project reach will enhance these recreational opportunities and support a healthy and productive fishery.

Local Economic Benefits. The Project will generate local economic benefits through construction employment, procurement of local materials and services, and engagement of Montana-based contractors and suppliers. The estimated four-year implementation period will provide sustained economic activity in the Drummond and Philipsburg communities, which have been adversely affected by the closure of the Ridgecrest Mine and the associated loss of mining employment.

6.3 Nexus to Alleged Violations

The Project directly addresses ecological impacts from the Ridgecrest Mine's historical discharges of acid mine drainage and tailings seepage to Flint Creek. The twelve-mile project reach downstream of the Ridgecrest Site has been the primary receiving water for decades of mine-related discharges, and the ecological degradation documented along this reach — impaired water quality, degraded fish populations, eroded banks, and diminished riparian corridors — is a direct consequence of the same mining activities that gave rise to the alleged violations addressed in the Consent Decree.

Stream-bank erosion along the project reach has been exacerbated by elevated flows associated with mine dewatering activities during the operational period of the Ridgecrest Mine, and by destabilization of riparian areas from historical mine-related land disturbance. Mine dewatering discharges increased the volume and frequency of high flows in Flint Creek, contributing to channel incision and bank erosion that have persisted even after the cessation of active mining in 2019. Historical mine-related land disturbance, including clearing for roads, pipelines, and infrastructure, removed stabilizing riparian vegetation and altered surface drainage patterns, further contributing to bank instability and erosion.