RESPONSIBILITY

We are a mining company that strongly believes in responsibility, accountability and cooperation with all of our stakeholders. By using responsible modern day mining practices and considering the support of the local communities to be integral to our mission, we believe that success of our projects can be done in a way the benefits the local people and mitigates impacts on the region’s environment.

Environmental Responsibility

In the past fifteen years the mining industry has undergone a shift in its thinking about corporate environmental responsibility. Today’s mining methods are significantly more environmentally and socially responsible than the methods practiced in past decades. Groups such as the International Council on Mining and Metals (ICMM) and the Alliance for Responsible Mining have created new guidelines for industry standards to encourage mining companies to strike a balance between environmental and economic responsibility by developing and implementing plans that reduce environmental impact on the local land, water, air and population.

South American Silver is committed to implementing well-designed, well-managed, and well-regulated mining operations to maintain a consistent balance between our environmental and economic responsibilities. By proactively monitoring and managing the potential environmental impacts of exploration and development activities those impacts can often be mitigated or eliminated throughout the entire operation, from exploration to production to eventual shut down and closure.

We will look to empower employees to recognize the importance of practicing mining activities that are in accordance with authorities in each community and are designed to reduce their environmental impacts.

Today, South American Silver is examining a heap leaching and or mill extraction process at the Malku Khota site as the most likely method of raw ore extraction. Updated metallurgical studies are slated for late 2010 and further testing will refine the leach process to ensure optimal results for the size of crushed ore and grade of ore.

By constantly evaluating and improving our operational practices we can continue to meet and exceed environmental and regulatory standards and ensure the achievement of our exploration and development goals.

Mining in Bolivia

Large-scale mining has been practiced in Bolivia for hundreds of years and the country is blessed with vast natural resources. Under the current Morales administration, the nation has enjoyed a return to positive growth with one of the fastest growing GDP’s in all of Latin America. Mining is very important in Bolivia representing over 40% of their GDP. Bolivia’s biggest trading partners for its natural resources are Brazil, Japan, and South Korea. Another key area of reform under the Morales administration has been a focus to bring benefits from resource development to local indigenous communities as well. In fact, three new major mining companies have begun production in the Bolivia in the last four years, including Pan American Silver, Coeur D’Alene, and Sumitomo, paving the way for further mining activities and a positive mining environment.

Community Relations

Our Management team has been conducting business for over 15 years in the region and understands the importance of a well-developed community relations program to encourage community participation while reducing potential delays. By working closely with the local communities, South American Silver has earned the trust of local communities and government and has set the stage for a mutually beneficial business and investment opportunity.

In May of 2009 South American Silver, in partnership with the Business for Social Responsibility (BSR) conducted extensive research to assess community perceptions around mining issues and increase our understanding of the role of civil society and government in the successful execution of our Malku Khota project. Drawing from the BSR research and our management team’s 15 years of in-country experience, we have developed a pro-active community outreach program to facilitate communication, address public concerns and mitigate development risk as we advance our Malku Khota project.

Part of our comprehensive community relations strategy includes the full-time employment of two community relations personnel who meet with members of the surrounding townships to conduct community meetings and provide mining education programs.

As we advance the Malku Khota project through to production, we will continue to look for infrastructure development and job creation opportunities to further stimulate the local economy.

We believe that the participation of surrounding communities throughout the development of the Malku Khota project is an essential sign of its success.