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Silvercorp: Canadian Mining Profits in China

Thank you all very much for the comments.

For fxtrader07, by talking with the management, I don’t think the power issue is really that bad. First of all, there was a press release dated Aug 13th and I copied the related paragraph on power supply below. Secondly, with the upcoming new power line and their own diesel power capacity, I think Silvercorp now has a good backup plan if the same problem occurs again in the future. And the Olympics is over. Third, as I was told by management, Silvercorp mining operations actually don’t use that much power, at least not as much as the perception of some investors think. In summary, their production target this year is unlikely impacted by the power supply issue.

Aug 13th press release from Silvercorp: “The Company has noted an improved outlook for its power supply problems outlined in the August 8, 2008 news release. There has been no power rationing for the last five days. The local County Utility Bureau has assured the Company minimum power rationing as power supply to the local county has also improved when a new hydro power generating project in the County was brought into operation last week. Management is working closely with the local Utility Bureau to minimize future power interruptions, including investing almost $1 million since last May to build a new power line to the Ying Mine. The new power line is expected to be complete by the end of this August. The Company is also expanding diesel power generating capacity at the Ying mine to cope with potential power rationing.”