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During the second quarter of 2010 (Q2 2010), our operations achieved record silver and gold output from the mining operations at Velardeña in Durango State, Mexico. A total of 106,887 ounces of silver (Ag oz) plus 3,064 ounces of gold were generated, which is a quarterly record. In addition, the mines generated 58,273 pounds of lead and 36,533 pounds of zinc which in all, and expressed in terms of silver equivalent ounces (AgEq oz), generated an output of 314,754 AgEq oz, based on recent commodity prices.

Also during the quarter, the Company negotiated an agreement with one of the world’s largest independent commodities trading companies to sell our pyrite/gold concentrates and signed the agreement shortly following the close of the quarter. The gold/pyrite concentrate is being shipped and processed at a metallurgical plant in United States, owned by an internationally recognized mining company. The terms of our agreement are for ECU to deliver an initial 10,000 tonnes from its gold/pyrite concentrate stockpile,
which at the time of the contract consisted of approximately 12,900 tonnes containing approximately 8,500 ounces of gold.

More recently, a vein structure was opened over a strike length of 54 metres with an average width of 3.21 metres and grading 3.36 grams per tonne (g/t) gold (Au) and 177 g/t silver (Ag). This structure, which was previously defined by drilling, is approximately three times the width of the same structure that was included in the Company’s latest mineral resource report. The mineral resource report calculated this structure with similar grades but with a reported width of only 1.1 metres or 34% of what was actually
found.