April 27, 2009 – ECU Silver Mining Inc. (TSX: ECU)
In the markets this morning and as of the release of this update, ECU Silver Mining Inc. (TSX: ECU) was trading at C$0.70 per share (an increase of C$0.07 per share or 11.11%) on trading volume of more than 2.5 million shares. ECU Silver is our most recent fully profiled company and as such, a complete investment overview is available on our Website at www.babybulls.com/profile_ecu.htm. By way of further introduction and in addition to the overview, below are our top 5 reasons for partnering with ECU Silver.
BabyBulls.com’s Top 5 Reasons
Below are the top five reasons BabyBulls.com selected ECU Silver as our next profiled company.
Massive Resource – ECU has one of the largest undeveloped silver equivalent mineral inventories in the world. In January 2009, ECU published its fourth NI 43-101 compliant technical report outlining a 431 million ounce silver equivalent resource. The Company has grown its mineral resource from 23.6 million ounces in July 2005 to an enormous 431 million ounces. This is an increase of more than 407 million ounces or 1700% in just 3½ years, a tremendous achievement!
Upside Exploration Opportunity – Over and above ECU’s above-described reported mineral resource, the technical report also outlines a further mineral potential of another 570 to 930 million silver equivalent ounces. If realized, this could eventually take ECU’s resource to over one billion ounces. The mineral resource was audited by the highly respected firm of Micon International and is compliant with National Instrument 43-101 standards, which provides an extra layer of validation to the resource.
Increased Production – In March 2009, the Company acquired a 500 tpd gold and silver recovery plant, a milestone transaction which should allow ECU to generate revenue through the production of silver/gold doré bars. To this end, the Company announced its first silver/gold pour in a press release dated April 23, 2009, less than six weeks from the date of the acquisition of the plant. This is absolutely remarkable given that most companies require six months or more to commission a mill. This is also a very important step for ECU because almost all junior mining companies have been severely discounted (see Valuation below) due to the risk they will run out of cash. As a result of the acquisition of the plant, ECU has essentially, for the most part, reduced this financial risk.
Valuation – Historically and prior to the global economic crisis, ECU was trading at approximately $3.00 per ounce of in-ground silver equivalent while the price of silver ranged between $10 and $15 per ounce. When the global crisis worsened in late 2008, non-producing junior mining companies were severely devalued, including ECU which currently trades around $0.45 per silver equivalent ounce. However, with its significant mineral resource, its two operational mills, its operations in one of the best mining jurisdictions in the world, ECU is a better company today than it was when it was trading at $3.00 per ounce. With silver prices at or above $12 per ounce, we could see ECU’s valuation rebound to previous levels.
Commodity Pricing – The historic silver/gold price ratio was 15 or 16:1, but in recent years, silver is relatively cheaper ranging from about 40:1 to 80:1. As of this morning, with silver at $12.84 an ounce and gold at $906/oz., the ratio is 70:1. This means that silver is currently undervalued, and cheaper than historic norms, and thus it is a better investment if you want to “buy low and sell high”.
We look forward to the growth of the Company and its progress and success going forward. As always, we will provide timely reporting and analysis of ECU activities to ensure that we maintain an informed investor audience.
For more detailed information about ECU Silver, its properties, and its opportunities, please look at the investment overview available at http://www.babybulls.com/profile_ecu.htm.
For information on this as well as other promising emerging growth micro-cap companies, please visit us at www.babybulls.com.
BabyBulls Disclaimer: This information is provided by BabyBulls.com to provide readers with information on selected publicly traded companies. The reader should verify all claims and complete his or her own due diligence before investing in any securities of profiled companies. BabyBulls.com has been retained to provide investor relations services for some of the companies mentioned in this profile and receives compensation for those services. Further, BabyBulls.com and its employees and affiliates may own, or may purchase and sell, securities of the companies profiled. BabyBulls.com undertakes no obligation to inform readers about the ownership or trading activities of it or its employees or affiliates in the securities of the profiled companies. BabyBulls.com has the following compensation arrangements with the companies profiled in this email: ECU Silver five thousand dollars per month plus one hundred fifty thousand options exercisable at C$0.70. Neither BabyBulls.com nor anyone involved in the publication of this email is a registered investment adviser or broker/dealer. BabyBulls.com makes no recommendation that the purchase of securities of companies profiled in this email is suitable or advisable for any person or that an investment in such securities will be profitable. In general, given the nature of the companies profiled and the lack of an active trading market for their securities, investing in such securities is highly speculative and carries a high degree of risk. An investor in such securities should be prepared and able to bear a loss of his or her entire investment. Nothing in this email should be construed as an offer or solicitation to buy or sell any securities of any profiled company. See the babybulls.com website for full disclaimer information.
ECU Disclaimer: This investment brief is not a publication by ECU Silver Mining Inc. As disclosed in the Company’s public documents, there are no assurances that all or any part of its resource estimate or that all or any part of its mineral potential will be economically viable. Until a prefeasibility study is completed, there are no assurances the release of its updated mineral resource will be economically viable. The mineral potential of the Velardeña District property is conceptual in nature and there has been insufficient exploration conducted within the mineral potential evaluation to define a mineral resource. It is also uncertain if further exploration will result in the targets being delineated as mineral resources. Based on N.I. 43-101 standards of disclosure for mineral projects, mineral resource estimates must not add inferred mineral resources to the other categories of mineral resources. ECU Silver does not endorse any disclosure to the contrary.
