I will try to anwser your questions Edgy.

1/ The 1.2 million silver eq. ounces is the planned production from the run of mine material for the oxide mill and I stated the 40 ounces per day of gold was in addition. It may actually be higher over the first year as there are over 12,000 tonnes of stockpiled gold pyrite con right now and the sulphide mill is running the tailings pile material which should produce another 30,000 tonnes approximately over the next 8-10 months before switching back to processing sulphide material from the mine. This processing of the gold pyrite con requires the operation of the roaster which is just about ready, I believe the last adjustment is a larger fan and this should be done within a week or so. It's also possible that at some point in the coming months that the small mill will be used to process the tailings instead of the sulphide mill but this would require the zinc and lead prices continue to improve and increase the revenue potential of zinc and lead cons. These zinc and lead prices are now getting closer again to a good return level.

Originally it was planned to run the gold pyrite con material after roasting in a separate tank system that exists at the oxide mill but the company through addition testing of this material has found better recoveries by blending it with run of mine material. The company is also seriously looking at adding a flotation circuit to the oxide mill to capture any sulphide associated gold and silver (which there is in our oxides) which will improve gold/silver recoveries to close to 85-90%, a very good number. This is very cheap and the space exists.

The 40 ounces per day gold production from the gold pyrite con is what 50 tonnes per day of gold pyrite con production produces after processing through the roaster and oxide mill. The sulphide mill when running sulphide materials at the rate of about 320 tpd produces this 50 tpd of gold pyrite con which contains 22 gms gold and 150 gms silver per tonne which in turn is about 24 gms of gold eq. which means about $36,000 US dollars per day which is about $10 million US dollars per year just from gold pyrite conc.

To summarize sources of revenue:

- ECU is processing oxide materials now – 1.2 million ounces silver eq. per year

- ECU will be processing gold pyrite at a minimum rate of 50 tonnes per day through the oxide mill when the roaster process is ready – 40 ounces gold per day

- ECU will enhance recoveries with a flotation circuit – probably a 10-15 % enhancement on run of mine material revenue

- ECU will re-start the sulphide production after the tailings are completed unless it makes sense to do so sooner due to lead and zinc prices recovery and use the little mill to complete the tailing processing, this will add a lead and zinc con with significant silver content to the revenue stream – depending on prices could be anywhere from $500,000 to $1 million per month

- company will increase production to 500 tpd and then move higher to 700 tpd and over time to over 1000 tpd at the oxide mill

2/ The company can not talk about revenues until they are produced due to regulatory restriction of the AMF regulators in Quebec. The company is classified a junior exploration company and that is the main reason why the financials were re-stated last year. So even though ECU is clearly a producer without a completed economic study it is not allowed to forecast. This means no forecasts until the economic study is complete which is ongoing or re-classification. This is why the company is not shouting from the roof tops but fortunately this stuff can be figured out approximately with some time and work. The company would love nothing better than to be shouting about the projected revenue stream. As I mentioned in my first post there are no shortages of those bidding on our dore as the quality is very good.

3/ The meeting was not taped for broadcast but this was discussed for future years. The attendance was less than last year and there were not many faces I didn’t know so only a handful of retail investors were in attendance. I was told by Compushare reps that low turn-outs have been very common this year. Major D was indeed present and actively working the room for information. And yes the company did hand out an ECU one ounce silver commemorative coin to those who took the time to attend, it was very much appreciated. This helps to focus the mind on the fact the company is indeed entering a new era and my expectation is they will be as successful a producer as they have been an explorer and both will grow substantially in the near and longer term future.

4/ Management was very upbeat and happy about progress this year. Steve presented the new corporate branding image that has started which will become more evident as the year progresses. Besides a new look the focus has been shifted to provide equal billing for production and revenue as exploration success. It seems production and revenue has become as important as exploration success in this new world and management has responded.

5/ The company is very anxious to get back to the massive sulphide exploration targets for which only the tip has been revealed. This will happen when they are satisfied with all mill operations and mine stope development, hopefully end of summer or early fall. The top priority right now remains to optimize operations of the 2 mills and new stopes before taking some manpower to focus elsewhere and I think this is prudent

6/ The company now has over 400 employees so the resources exist to continue production and exploration development. A question was raised at the meeting by a shareholder I didn’t know about the 1 billion ounce resource potential and management outlined how much the ECU resource has grown over the last 3 years and that they expect this to continue based on the modeling and present thinking. Steve showed a slide showing how much the ECU resource has grown over the last 3 years with only 3-4 drills working part time versus our peer group and in particular MAG Silver which has had at least 15 drills working most of the time and the ECU results blew them all away. This slide showed there is no contest between ECU and their so called peer group. Of course MAG has been very well funded and never had to allocate tight resources as has ECU.

7/ Steve also talked about the great infrastructure available in the area of Valardena and the companies commitment to major production expansion through a new larger mill and or mill acquisition but wouldn’t elaborate further. It was clear to those present that shareholders can expect major increases in production capacity going forward.

8/ If anyone has any additional questions I will try to answer them, if I can, over the next few days.

This is a quick summary of the ECU annual meeting on June 8, 2010. I didn’t take notes so this is from memory. The meeting was very interesting with no real unknown developments but lots of confirmation of present production success and future plans. One thing that the company indicated quite strongly on a number of occasions during the Q&A is that no equity issues are planned now and that they plan to avoid equity issues given the recent experiences. Everything here was stated publicly at the meeting.

- about 25 people in the room

- company discussed the 6 month mill plan for increasing production with the primary focus on increasing recoveries followed after optimization with a move to higher tonnes per day

- recovery results improving weekly as a result of new VP operations

- new mine manager has increased stoping efficiency and development, of course as drifts are created to access the oxide material it also opens the access to sulphide material for future extraction and this is important for the future 1500 tpd sulphide mill planned

- the expected end result after 6 month plan is for a run rate of 2 million silver equivalent ounces of annual production from the 2 existing mills plus inventory of gold pyrite con

- company stated they are very committed to the phase one production expansion of 1500 tpd and expects this to take 12-18 months to complete from final decision

- phase one expansion will produce 5-6 million silver equivalent ounces from sulphide ore and generate $30 million in cashflow

- phase two expansion will be to increase this to 5000 tpd which will generate over $100 million in cashflow

- more importantly the company says this new 1500 tpd mill will require no equity dilution and they have been involved in serious discussions to date

- the mill will either be a purchased mill that is re-built on site or a completely new facility with no permitting issues, water issues, road access issues or electricity issues

- continuing to ramp to level 22 and this will take many months to complete and is critical to future production expansion of phase one

- lots of good exploration surprises have been occurring recently with new production drifting, some press released and some yet to come

- since the last 43-101 report lots of inferred has been upgraded to M&I as a result of drifting sampling and this will be reflected in the next 43-101 which has not yet been commissioned

- one common thread through most of the Santa Juana direct face sampling programs has been to demonstrate a consistently higher grade of gold/silver and over wider widths than the drill holes that were used in the calculation of the official 43-101 and this has been alluded to in the past and recent press releases. I mention this because the significance is that our existing resource in 43-101 report really under states the size of the present resource from the Santa Juana section of the mine which accounts for about 180 million ounces. This discrepancy is easily 30-40% and maybe much higher.

- the company is committed to starting deep drilling program when they are confident there is a sufficient cushion of cash contingency. They are very excited about the prospects for success of this program as well as significant expansion of our vein systems through further exploration. I think their course of action is prudent given what has transpired over the last 12-18 months in world financial markets.

- the only thing the company is not happy about is the stock price and this was brought up by both shareholders and management a few times during the Q&A. At least on two occasions the company stated one of it’s goals in the next year is to see the stock price back above $3 dollars and they believe the company can easily support this valuation in the mid-term.

- as an example of recent PR, the company stated they recently presented to 22 institutions/funds on a recent trip to Europe and meet with very positive comments that they will now try to get buying from. This is an ongoing process and part of the recent plans to really start pitching the story now that things are really falling into place on cashflow and the hiring of Mark Butler the new IR person was part of this strategy. I expect to see more news items and reports in the future as a result of the new approach which in time will increase demand for ECU stock.

- the company does plan to switch back to reporting as a producer in the future when the AMF agrees the criteria has been meet which is either a full pre-feasibility study or sufficient consistent revenue that is material. The company really qualifies already but I expect this will take a few months of proof for the regulators.

- the company is in arbitration right now with GOG and would not discuss the details other than to say all issues indicated in the complaint were addressed 6 months ago.

- the company also directly alluded to possible acquisitions in the area of mineral assets and stated they are constantly approached with interesting opportunities at various stages of development.

I have tried to cover off on what I can but I will admit in a conversation earlier today with a friend who was asking me questions about the meeting, more stuff came to mind. So I will try to answer any questions over the next couple of days if I know the answer.

Everything that can be said has been said so I am going to ask once again as I have before for everyone to cease and desist these personal attacks. Many posters here have expressed their views on this nasty political stuff and personal attacks that all have suffered from. Everyone has been more than patient with the few posters who continue to persist. I had hoped that appeals from others lately would quell this ongoing useless and destructive non-debate that has denigrated to he said she said stuff.

Let common sense and human decency prevail and ignore that which you don't like as opposed to using it as a provocation to attack. I'm sure the vast majority on this board would appreciate the end of all the nasty politcal discourse and personal attacks.

Please pay attention to those who have courageously spoken out against this discourse and those who have ended their paticipation for the bettermeant of all here. I would encourage and ask everyone to exercise some restraint and self discipline to bring this to an end.

ECU SILVER MINING INC...

originally published August 29th, 2010

ECU Silver is a stock that is regarded as grossly undervalued both in relation to its established mineral resources and to its state of development as a company. We haven’t looked at it for quite a while, as although the stock has made some tradable fluctuations it has essentially been bogged down in a basing pattern since the start of last year. Now, however, there are indications that it is about to break out of this base area, a development that can be expected to synchronize with gold and silver breaking out to new highs to begin an important new upleg.

We’ll start by looking at the long-term chart, to gain an overall perspective on the evolution of the company. Many of you may recall that ECU made major discoveries at its Velardena properties in the middle of the decade. This caused the stock price to soar, and happily we were around to participate in that, but as Greenspan would put it, it led to a period of “irrational exuberance” when the stock price raced way ahead of the fundamentals, as it’s one thing to discover a mineral resource and quite another to get to the point where you can bring it to market. So once the excitement of the discoveries abated, a long hangover set in which saw the stock price retreat steadily as the company embarked on the long road to create the infrastructure to bring its highly impressive resource assets to market. Most modern investors do not like terms like “long road”, “commitment” and “patience” and they certainly don’t like stock issues, so the stock price went down and down as the company went ahead and laid the foundations for future production and the shares in issue swelled from about 150 million at the time of the discoveries to a weighty 307 million or so now. There are 2 points to make regarding the number of shares in issue, which we would normally find off-putting. One is that ECU has grown its mineral resource from 1.6 million tons in July 2005 to an enormous 30 million tons. So the stock price has less than trebled since then, while the resource base has increased by a factor of 18.75 times. During this period the number of shares in issue has grown from about 150 million to about 307 million, while the price of silver has more than doubled and the price of gold has tripled, more than cancelling out the impact of the higher number of shares. So it is therefore fair to say that a less than threefold increase in price from 2005 has occurred while there has been an 18.75 fold increase in the resource. From this simple calculation we can deduce that ECU stock is very attractive here on fundamental grounds despite the seemingly high number of shares in issue. The other point worth making is that about 40% of the stock is tightly held by a number of big investors, reducing the supply on the open market substantially, and making a hostile takeover of the company very difficult indeed. Now we will look at the charts to see how the price pattern is shaping up.

Starting with the long-term chart we can see how ECU rocketed up in 2006 on news of its discoveries breaking. Then, after a large top area formed, it went into a long and persistent decline which ended up taking the price right back almost to pre-discovery levels. As mentioned above, due to the massive increase in the resource base and the advances the company has made towards production, the selling that drove the price down is now regarded as having been way overdone. In other words the stock is viewed as being way undervalued relative to the company’s proven resources and current position. It is evident from this chart that other savvy investors are well aware of this fact, which is why a clear base pattern has been forming, that we will now look at in more detail on the 2-year chart. Before leaving the long-term chart it is worth taking a look at the volume indicators at the top and bottom of the chart. The Accum-Distrib and On-balance Volume lines have remained buoyant despite the severe decline in the stock price between 2006 and 2009, which is a positive sign that bodes well for the future, for this signifies that there was no great weight of selling on the decline, which was occasioned by continued light selling in the absence of bids, and the decline towards the final lows accelerated as the stock got caught up in the general selling panic late in 2008. A clear Cup and Handle base has formed over the past 2 years, which we will now examine in detail on the 2-year chart.

On the 2-year chart we can see that the stock price finally bottomed in March of last year, after which a fine, clear Double Bottom developed as the price later returned to test the March lows in August - September. It then drove clear above its 200-day moving average which then turned up for the first time in well over 2 years, but the time was not right for breakout and sustained advance, so it slipped back again and ran off into a gentle downtrend that has persisted up until the present, and which has taken the form of a bullish Falling Wedge, that also comprises the Handle of the Cup and Handle base pattern. As this Handle reaction developed we can see that volume has died back in a satisfactory manner. This Cup and Handle base certainly appears to be complete, and it is regarded as no coincidence that gold and silver are on the point of breaking out to new highs. If they do it would be a fitting point for ECU to break out of this base pattern to enter a major uptrend, and here we should note that what differentiates ECU from other silver companies is that ECU’s mineral resource has a large gold component. Gold actually makes up almost half of ECU’s precious metal content - so ECU Silver could by rights be named ECU Gold and Silver, although the existing name is more tidy.

While it would have been good to buy ECU stock before last week’s sharp rise, our charts show that in relation to the overall pattern there is still everything to go for here, for the stock is still some way from breaking out of the base pattern, and is at last in position to embark on a major advance after several difficult years.

Although the company is faced with challenges - it has, for example to deal with a $17 million debt , and has to construct a new higher capacity mill to process its resources - these are normal growth experiences and it is expected to successfully roll over the debt as it has in the past, and once financing for the new high capacity on-site mill has been organized, it should be possible to get it completed in as little as 8 to 12 months. Otherwise, logistics and infrastructure are already excellent, with the company’s mines mostly grouped together near to the 2 existing mills, which are very close to a new 2-lane highway. By far the largest mine, the Santa Juana mine has been developed and prepared to go into large scale production, with new modern office facilities being completed right now above the mine. As an exploration company ECU continues to search out new prospects and has located more rich prospects in the direction of Durango. The narco gang problems in Mexico, which have been attracting lurid headlines in the international press, while by no means over, are being brought under control to a greater extent than is generally realized. In any case, the challenges facing the company have already been factored into the stock price and thus discounted, which is why it is still trading at such a low level, and since we know that the market looks ahead, it is clear that in the face of the expected advance in the price of gold and silver the stock price won’t wait until the new mill is completed before it advances, particularly once investors refocus on the most important single fact - the enormous mineral resource that is already delineated and in the company’s possession.

In conclusion ECU Silver is regarded as a solid gold and silver stock with the prospect of substantial gains from the current low price, and is thus an attractive addition to any investors Precious Metals portfolio.

I attended the PDAC conference in Toronto this week and want to update shareholders of Golden on what I heard and some conclusions I have drawn from discussions with 3 people from Golden plus some comments from another shareholder who has talked to Golden head office this week.I won’t try to make any particular order of the comments gathered.

1.New San Mateo ramp is critical to future increases in mill feed rate and it’s expected to be completed around July 2013.This ramp will allow multiples of the present production rate and will solve a critical issue moving forward, the amount or ore available to mill will no longer be restrained.

2.This will make the mill processing rates the issue going forward.The present processing rate for the Sulphide mill is 340 tpd and the Oxide mill has been successfully run by ECU at over 500 tpd.In my view the sulphide mill processing rate can be easily increased to 450 tpd if the company chooses to and the Oxide mill can reach about 900 tpd if the company chooses too as it was rated for 1000 tpd when created many years ago.Both would require some modifications to reach these levels but this would not be a costly major upgrade.In addition the company is now running a sulphide flotation circuit in front of the Oxide mill as originally planned by prior ECU management that creates a lead/silver con.The company is presently running a combined 500 tpd with the intent to increase to 600 tpd as the year progresses.I see a significant opportunity to increase the processing rates upon the completion of the San Mateo ramp and expect to see a revised plan in the coming months and have pushed this idea. The company is being too conservative in my view but I also understand why as they want to exceed expectations and want to see ramp completion.I have made clear to management they have been too slow and not aggressive enough given they acquired 2 operating mills, a started ramp and a mine already in transition to increase production when they took over post-merger.I don’t wish to rehash the reasons as they have no bearing on the future progress.

3.The recently implemented shift change to two 10 hour shifts has lowered costs and I would argue the shift change to two 10 hour shifts from three 8 hour shifts increases the tonnage sufficient to get to 600 tpd with no additional ore coming from Santa Juana due to the completion of the San Mateo ramp.

4.This raises the issue of feed, of course there are massive amounts of sulphide ores available (tens of millions of tonnes) so with the new ramp capability and shift change there will be no constraints whatsoever to increased sulphide production other than present mill capacity.The Oxide ores are another matter as these are more limited in availability on site ergo they are running what I will refer to as transition ore (muck) which has a little higher degree of sulphides than is ideal for a CIL oxide mill.There are plenty of available stope opportunities with this transition type ore but it does present some issues as ECU management experienced (and dealt with) and recently Golden management experienced with gold recoveries, this is why the circuit has been added to the oxide mill plus the studying of Albion oxidation process to improve gold recoveries.The new ramp should also increase oxide ore access on site.The other option being explored is to access some off-site oxide ore feed as was being explored by ECU management, Golden has been slow getting to this partial solution but is now actively pursuing this strategy to supplement present oxide feed.There are numerous potential sources in the area that were identified by prior ECU management that could be fairly easily accessed.

5.Significant progress has been made on gold recoveries testing and the addition of doubling the Merrill Crowe system should increase gold/silver production.

6.As I stated a few days ago the company would have to be operationally profitable in the last 6 months of the year to make-up for the first 6 months of the year to get to target of $1 million gross margin short on all of 2013.The company assured me this was the case and they expect to be cashflow positive in late Q2 or early Q3 as I had already surmised from their recent 10K filing if they stay on plan.The company fully expects to exceed the published plan but would not provide details but if the ramp is completed in the summer it’s not much of a stretch to see a 20% improvement in the plan and possibly more.

7.Although recent veins status at Chicago has been a little disappointing lately due to some unanticipated vein narrowing, they assure me this is temporary and simply part of the process on continuing to open up Chicago for further mining.The company is very committed to increased exploration going forward and has lost none of the initial high expectations for future success.

8.The company has made it clear they are as concerned as shareholders with the present share price and what they suspect as direct short interest and HFT interventions exacerbating the present weak gold/silver market conditions and their slightly slower plan progress. The company has been encouraged to acknowledge some of these concerns to shareholders and indicate they have explored the above subject and not ignored this ongoing market disruptive trading practises.The company is committed to the 2013 plan as a minimum and sees no barrier to the successful implementation for 2013 which will provide operational profits for Velardena if they exceed the plan only slightly.The company has ample funds on hand for the plan this year and will still be well funded going into 2014.

9.As indicated by the company that they are working on a JV for El Quevar and it wouldn’t surprise me to see some development in this regard in the coming months with a company that is Argentinian based or at the very least committed presently operating assets in Argentina with a view to future growth there.This should prove very positive for Golden going forward.This will leave the company with 40 odd property assets with some of these considered core holdings with serious upside resource potential, 2 operating mills at Velardena with over 400 million ounce silver eq. resource, cashed up for 2013 plan with a reserve of a minimum of $24 million for year end, a strong JV partner for El Quevar to move this very good project forward where I suspect building the resource to over 100 million silver ounces with the new extension discoveries will not be that hard, plus a 50% JV (going to 60%) in San Diego.

None of us ever expected to see this price level for the stock or an almost 2 year consolidation in gold/silver market.As frustrating as it has been and we all know about this subject, this year should lay the ground work for many years of future operational growth with the completion of the San Mateo ramp, mill upgrades, and recovery improvement measures which will get this story back on track after a slower 2012 than hoped.Given the present suppressed share price moving much higher should be not be very difficult if things stay on plan.I would expect the company will exceed the plan with a commensurate increase in share price which could really take off if this gold/silver market environment shifts positively as expected.Timing of course being very difficult to know or see but I will focus on the recent Sinclair commentary for clues.

Dave from Denver on a related note…

Wednesday, October 14, 2009

An Update On Aquiline/ECU: Aquiline Hits Paydirt, Is ECU Next?

On Sept. 29, I posted analysis that explained why I was confident that Aquiline Resources and ECU Silver are fundamentally "twin" companies and why both stocks are ridiculously cheap to fundamental value.

Well, Aquiline just agreed to be acquired by Pan American Silver (PAAS), in a stock and warrant deal that effectively values Aquiline at $626 million (based on the current price of PAAS stock), or roughly 83 cents per ounce of silver Aquiline has indicated on its latest 43-101 resource filing. We will be taking some profits on our Aquiline position and plowing them into even more ECU stock.

Using this deal as a guideline to assess the relative value of ECU, applying 83 cents to ECU's measured, indicated and inferred resouce of 431 million, ECU stock would have a value of $1.25 vs. it's current trading level of $.77. HOWEVER, Micon International, the independent mining engineering firm which prepares ECU's highly regulated 43-101 Resource Estimate Report, has identified additional mineral potential that has been quantified at an additional 570 to 930 million silver equivalent ounces.

If we apply the 83 cents/per ounce in the ground to just the low end of Micon's assessment, that would give ECU 1 billion ounces, and an implied valuation of $830 million, or $2.91/share.

One more point to bear in mind. At one point in May 2006, the market was valuing silver in the ground, on average, at $2/ounce. If we apply THAT metric to ECU, the Company would be worth anywhere from $860 billion to $2 billion, or $3-$7/share. Please note that back then the spot price of silver was around $13/ounce and had hit a brief peak of $15.35. Right now silver is $17.85/ounce on its way to at least $20. At some point, the market will value in-ground silver much higher than $2/oz. In other words, any way you want to value ECU's reserves, the stock is incredibly cheap.

I can say with complete confidence, and with money backing my statement, that I have rarely, if ever, seen an investment opportunity in the stock market with the low risk/high return potential of ECU. I say this because ECU, as per its latest press release, is now generating monthly cash flow from its milling operations that is much higher than anyone expected (except maybe CEO Michel Roy), it has demonstrated that the mineralization of its ore has a higher amount of gold than previously thought, and it has the certified potential to have at least a 1 billion ounce deposit. I might add that a huge benefit, though not well understood by most investors, from the Company's endeavor to generate revenues from processing its stockpiled ore is that it has demonstrated that is has a solid understanding of the metallurgy of its massive silver deposit. That issue is the golden (or silver) key to unlocking the value in a discovered mineral deposit.

Oh, and let's not forget about the Massive Sulphide Zone, which still needs to be explored. In conversations with people who have visited the mine-site, it is believed that this Zone could contain several hundred million additional ounces of silver. It is thought that this Zone is the ultimate source of ECU's already proved silver deposit. That potential is not factored into the above valuation analysis.

Please do your own due diligence. I have found COO Steve Altmann to be very responsive and user-friendly to any and all investor inquiry.