Cerro Jumil Project

Excellent Access and Infrastructure

The Cerro Jumil gold/silver project was acquired by the Company in May 2003. The property is located south Cuernavaca in the State of Morelos, Mexico. There is excellent access and nearby infrastructure.

A New Gold Discovery

In March 2005, the Company announced the discovery of gold and silver mineralization in drill holes in the what is now known as the West Zone. This was followed in July 2005 by the discovery of extensive surface gold mineralization in the Southeast Zone. Drilling began here in November 2005. As of June 2008 over 32,000 meters in 177 drill holes have been completed.  Mineralization is now found in three contiguous zones known as West, Southeast and Las Calabasas.

Gold and silver are associated with a variety of altered rocks around the periphery of a granitic stock that intruded into overlying limestones. The mineralized suite of rocks, collectively known as skarn, is well exposed at surface along the southern, eastern and western margins of the granite/limestone contact.

2009 Preliminary Economic Assessment

On  September 8th, 2009 the Company announced the results of a Preliminary Economic Assessment . The PEA study was completed by Vector Engineering Inc. with Mine Development Associates and Lyntek Inc. providing design and cost estimates for the mine and process areas respectively.

The study demonstrated the potential for a highly profitable gold mine using standard low-cost technologies to recover gold and silver. Start-up capital costs are estimated to be $72 million. Annual production of over 50,000 ounces of gold is forecast at a cost of $418 per ounce. Current feasibility work is aimed at increasing annual production while reducing capital and operating costs.

Cerro Jumil Resource Estimate

The initial gold resource for the Cerro Jumil project contains 636,000 ounces of gold categorized as measured and indicated and 378,000 ounces of gold categorized as inferred. The deposit also contains slightly more than 6,000,000 ounces of silver categorized as inferred. An on-going drill program is designed to expand the current resource and upgrade its classification to predominantly measured and indicated.

Feasibility Studies Advancing

The project has now entered the feasibility stage of development. A 15,000 meter drill program is underway and will focus on expanding and upgrading the currently defined gold resource, primarily in the Calabasas zone. Earlier drilling has encountered gold mineralization in this area that will now be further defined and quantified.

Our recently completed Preliminary Economic Assessment (News Release Sept 8, 2009) recommended further metallurgical testing. Accordingly a sample has been shipped to SGS Laboratories in Durango, Mexico and column testing to further define heap leach characteristics has begun. This will be the first in a series of subsequent metallurgical investigations designed to further optimize the heap-leach process parameters for use in a feasibility study.

Progressing on a parallel track the Company has begun the work necessary for an Environmental Impact Statement. Although completion of this document is dependent on completion of the Feasibility Study as much background information as possible is now being collected including hydrology, flora and fauna characterization, socio-economic studies, etc.

Involving All Stake Holders

The project is located on land owned by the San Agustin of Tetlama Community. Esperanza has had an open and productive relationship with the community and will continue to work to assure that it benefits directly from the project. In addition, Esperanza recognizes that there are additional stakeholders, a larger public who must be involved and must also benefit from the project. Esperanza has worked hard to identify these stakeholders and welcomes their participation as the project develops.

Esperanza believes that success of the project demands both management by Mexican nationals and local participation. It has assembled an experienced and dynamic national team to advance the project towards production and is confident that under their leadership this endeavor will be successful.