Seems that it is really an ECU question about the status of their 50% ownership and their ability to pledge it as collateral.

Another potential problem was raised in the Management Discussion & Analysis that Golden Tag Resources — ECU's joint venture partner on the San Diego property — released on Wednesday. In the MD&A, Golden Tag's management wrote:

"Subsequent to the year-end the company became aware that its joint venture agreement (JVA) partner on the San Diego property is in breach of several covenants and representations made by it in the JVA. The matters are not in material dispute and the other party has advised the Company (Golden Tag) that it believes it will have these breaches rectified."

I asked Stephen about this, too. He replied: "The breach in the JV agreement is that our lenders have our mineral assets as collateral. There was some confusion as to whether this claim included GOG's 50% interest. We are working with the lenders to sort it out. And they have told us that it would be no problem to sort it out."

Stephen added that the lender, IIG Capital, has worked with ECU for the past 10 years and is very accommodating.