TORONTO, May 29 - Dragon Capital Corporation ("Dragon Capital" or "the Company"), (TSX: AHD), a miner and producer of zinc, lead and silver in China, today announced its financial results for the first quarter ended March 31, 2007.

Dragon Capital completed the acquisition of all the outstanding shares of Arehada Mining Corporation ("Arehada") effective March 14, 2007 through a reverse takeover transaction. Dragon Capital's management will propose that the corporation be renamed to Arehada Mining Limited at the Company's upcoming annual meeting, scheduled for June 27, 2007. The name change is intended to reflect the Company's origins.

The Company earned $2,356,000 ($0.015 per share) on total revenue of $4,611,000 for the period ending March 31, 2007.

During the quarter, Arehada conducted mining operations at approximately 1,500 tonnes per day (tpd) and operated 70 days during the period. This rate is in line with expectations for the period based on a projected 300 day per annum operation. Head grades of approximately 1.1% zinc and 1.0% lead resulted in a 90% recovery factor for both. Silver head grades of 57 grammes per tonne met a 75% recovery factor into the lead concentrate.

These grades are below the overall head grades for the resource cited in an independent consultant's report on Arehada's mine located in Inner Mongolia, China, but reflect the mining of above normal amounts of waste rock at the commencement of mining operations. Additionally, a larger than normal amount of lower grade material was mined to take advantage of firm commodity prices. Grades are expected to improve through the balance of 2007 with production levels at or slightly above the projected rate of 450,000 tonnes per annum.

Exploration Activities

During the quarter, Arehada undertook development drilling to outline further mineral resources to support an increase in underground mining capacity to 3,000 tpd. The Company's current milling operation will also be upgraded to the 3,000 tpd level. This drilling and ultimate expansion in capacity will be financed through internal cash flow.

Construction of Zinc Plant

Construction of the first phase of the Company's new 50,000 tonnes per annum plant to produce zinc oxide and sulphuric acid from concentrate is now complete. The plant is expected to be fully operational by the end of 2007. This facility, the only one in the region, will process ore from Arehada's mine and several other local zinc mines.

To date, $17 million has been spent in building the first phase, funded through a five year term loan from a major Chinese bank. Management plans to accelerate the plant start up process, an initiative that will require an increase of approximately $6 million in working capital. Arehada is currently examining a number of alternatives for this funding.

About Dragon Capital

Through its 100% owned subsidiary Arehada Mining Corporation, Dragon Capital is engaged in the exploration, development, extraction and refining of zinc, lead and silver in Dongwuzhumuqinqi, located in Inner Mongolia, China. Arehada produces zinc and lead concentrates, which are then sold to smelters in China.

Arehada is currently constructing its own zinc plant with a designed processing capacity of 100,000 tons per annum. The first phase, with a rated capacity of 50,000 tons per annum, will produce zinc oxide and sulphuric acid.

Forward Looking Statements

The above contains forward looking statements that are subject to a number of known and unknown risks, uncertainties and other factors that may cause actual results to differ materially from those anticipated in our forward looking statements. Factors that could cause such differences include: changes in world commodity markets, equity markets, costs and supply of materials relevant to the mining industry, extent of resources actually contained in mineral deposits, actual recoveries achieved in processing ore, technological change, change to regulations affecting the mining industry, risks associated with mining operation in China, and environmental and safety regulations and risks. Forward-looking statements in this release include statements regarding future programs, review completion dates and opportunities. Although we believe the expectations reflected in our forward looking statements are reasonable, results may vary, and we cannot guarantee future results, levels of activity, performance or achievements.

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