The Company sold its gold production to the CBV for the first nine months of 2007. Sales to the CBV were

based on the USD spot gold price at the time of delivery; however, payment was received in Bs, with the USD

revenues converted to Bs by the CBV at the then official rate of Bs 2,150. In 2006, for USD reporting purposes,

the Company converted the Bs back to USD at the same rate of 2,150 and, as a result, the reported realized

price per ounce was comparable to the actual average spot gold price for the period. However, with the parallel

rate in 2007 materially above the official rate and since the Company is not registered to purchase USD in

Venezuela at the official rate, it was determined that for 2007 USD reporting purposes, the Company convert the

Bs revenue back to USD using the higher parallel rate. (In practice, the Company does not convert the Bs

revenue to USD, rather the Bs are used to fund ongoing operations). As a consequence of receiving Bs at the

official rate on gold sales, then converting back to USD at the parallel rate for reporting purposes, the

Company’s quarterly 2008 and 2007 reported USD revenue reflects a realized price that is significantly below

the average spot price for these periods and below the actual price realized for the respective period.

Similarly, USD reported operating costs in the 2008 and 2007 quarters have been reduced as a result of

converting a portion of the costs to USD at the higher parallel rate in 2008 and 2007 compared to the official rate

used in 2006.