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This paper presents a full wave-equation methodology for velocity model building based on the non-linear inversion of a semblance criterium with respect to the velocity field. A new type of migration, called the modulated-shot migration, is used to obtain the necessary gathers. The semblance of these gathers after spatial averaging is used as the cost function. This methodology is shown to successfully image the Marmousi model and the sub-salt part of the Sigsbee model.