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<br />Mr. Javier Sierra <br />August 8, 2006 <br />Page 4 <br /> <br />the design. We may, as necessary, observe placement of gravel pack and installation <br />of the cement seal. <br /> <br />Task 2 - Well Development Observation <br /> <br />We will review in the office the progress of the well development operations to <br />confirm that the sand content and turbidity are within minimum allowable levels. <br /> <br />Task 3 - Pumping Test Observation <br /> <br />Following development operations, a constant rate pumping test will be <br />performed for a minimum period of 8 hours, with drawdown and recovery <br />measurements taken in the pumping well. We will review the protocol of the testing <br />program to assure that the data received is usable. <br /> <br />Task 4 - Pumping Test Analysis and Summary Report Preparation <br /> <br />Information derived from Task 3 will be analyzed by our firm. As part of this task, <br />a completion report will be prepared summarizing information gathered during both <br />phases including an as-built diagram of the production well, and will contain our <br />conclusions on the required pump characteristics and operating "safe sustained yield" <br />of the well. <br /> <br />COST AND PERFORMANCE <br /> <br />Assuming that both phases are completed, the total cost for the project will be <br />$15,000.00. This amount covers our field operations, reduction of data and report <br />preparation in the office, and all travel, mileage, and other expenses. However, fees for <br />laboratory analyses of water samples for irrigation suitability are not included in our <br />estimate. Should the results indicate that a production well is not feasible, the project <br />will be curtailed following the completion of Phase 1, Task 3. In that event, the total <br />cost will be $8,300.00. The following table presents a breakdown of the costs on a per- <br />task basis. <br />