Amerigo Resources Ltd.

Amerigo Resources Ltd.

October 21, 2010 09:02 ET

Amerigo Reports New Record Quarterly Copper Production

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Oct. 21, 2010) - Amerigo Resources Ltd. (TSX:ARG) ("Amerigo" or the "Company") is pleased to announce production results for the third quarter of 2010 from Minera Valle Central ("MVC"), the Company's operations located near Rancagua, Chile. For the three months ended September 30, 2010 MVC produced 13.39 million pounds of copper and 233,266 pounds of molybdenum.

Amerigo's president, Dr. Klaus Zeitler, stated, "We are very pleased to report that copper production of 13.39 million pounds in Q3-2010 set a new quarterly production record, up 16.33% from Q2-2010 and 32.31% higher than the 10.12 million pounds produced in Q3-2009. Molybdenum production also increased substantially, and at 233,266 pounds was 49.76% higher than Q2-2010 and 54.16% higher than Q3-2009. Higher molybdenum capture in the copper circuit was achieved in the second half of the quarter due to processing improvements made in accordance with preliminary results from the technical study initiated in Q2-2010. Power costs remained high, in particular in August, and the Company's generators were only partially operational during the quarter. This, together with a strengthening Chilean peso, will adversely affect earnings in the quarter. Since September the cost of energy has trended downward, however, which will positively impact the Company's production costs in Q4-2010."

Key operating and sales metrics are shown below.

Production Metrics: Q3-2009 Q4-2009 Q1-2010 Q2-2010 Q3-2010
Copper Production (million lbs) 10.12 12.12 8.59 11.51 13.39
Molybdenum Production (lbs) 151,310 246,636 143,371 155,755 233,266
Ore milled (Tonnes 000's) 12,889 13,576 11,582 12,942 14,016
Copper Grade (%) 0.14 0.15 0.144 0.148 0.155
Copper Recovery (%) 26.03 27.00 23.40 27.20 27.92
Molybdenum Grade in copper concentrates (%) 0.59 0.73 0.56 0.48 0.65
Molybdenum Recovery (%) 74.13 82.59 85.70 84.04 81.92
Sales Metrics: Q3-2009 Q4-2009 Q1-2010 Q2-2010 Q3-2010
Copper sales1 (Million lbs) 10.19 12.59 8.50 11.35 13.38
Copper price at end of period ($US/lb) 2.79 3.33 3.56 2.96 3.65
Prior period copper sales subject to final pricing during period (Million lbs) N/A1 1.41 2.15 3.66 5.49
Average final settlement price for prior period copper sales ($US/lb) N/A2 2.8522 3.2872 3.0248 3.2853
Company's Recorded Copper Price ($US/lb)3 2.43 2.79 3.20 3.09 2.924
Molybdenum sales (lbs) 147,894 252,761 137,094 156,514 231,837
Molybdenum price at end of period ($US/lb) 14.125 11.230 17.18 14.325 15.360
Power Costs (per kwh) $0.0989 $0.0963 $0.1479 $0.1533 $0.1590
1 Copper sales per the Company's records, which may differ from copper sales per the smelter. All differences between Company and smelter records for a quarter will be recorded as settlement adjustments in subsequent quarters until settled.
2 Although the Company's Q3-2009 copper production was being priced on the basis of M+1, production was behind delivery quotas therefore all copper production in Q3-2009 was finally priced.
3 Copper price recorded for the Company's financial statements for the quarter before smelter and refinery charges and settlement adjustments to prior periods' sales and after hedging. The Company calculates this number by dividing quarterly dollar sales as recorded in its financial statements (calculated based on copper deliveries per the smelter) over quarterly copper sales per the Company's own records.
4 Calculated from dividing the dollar value of gross copper quarterly sales over copper sales per the Company's records. If the calculation was done using copper sales per the smelter, the normalized recorded copper price would be $3.12/lb.

The Company will also release Q3-2010 financial results at market open on Wednesday November 3, 2010 and will hold an investor conference call to discuss the results on Thursday November 4, 2010 at 11:00 am Pacific Daylight Time/2:00 pm Eastern Daylight Time.

To participate in the call, please dial the following number:

1-877-240-9772 (Toll-Free North America)

Please let the operator know you wish to participate in the Amerigo Resources conference call.

Media are invited to attend on a listen-only basis.

Following management's discussion of the quarterly results, the analyst and investment community will be invited to ask questions.

Amerigo Resources Ltd. produces copper and molybdenum under a long term partnership with the world's largest copper producer, Codelco, by means of processing fresh and old tailings from the world's largest underground copper mine, El Teniente near Santiago, Chile. Tel: (604) 681-2802; Fax: (604) 682- 2802; Web:; Listing: ARG:TSX.

Certain of the information and statements contained herein that are not historical facts, constitute "forward-looking information" within the meaning of the Securities Act (British Columbia), Securities Act (Ontario) and the Securities Act (Alberta) ("Forward-Looking Information"). Forward-Looking Information is often, but not always, identified by the use of words such as "seek", "anticipate", "believe", "plan", "estimate", "expect" and "intend"; statements that an event or result is "due" on or "may", "will", "should", "could", or might" occur or be achieved; and, other similar expressions. More specifically, Forward-Looking Information contained herein includes, without limitation, information concerning future tailings production volumes and the Company's copper and molybdenum production, all of which involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such Forward-Looking Information; including, without limitation, material factors and assumptions relating to, and risks and uncertainties associated with, the supply of tailings from El Teniente and extraction of tailings from the Colihues tailings impoundment, the achievement and maintenance of planned production rates, the evolving legal and political policies of Chile, the volatility in the Chilean economy, military unrest or terrorist actions, metal price fluctuations, favourable governmental relations, the availability of financing for activities when required and on acceptable terms, the estimation of mineral resources and reserves, current and future environmental and regulatory requirements, the availability and timely receipt of permits, approvals and licenses, industrial or environmental accidents, equipment breakdowns, availability of and competition for future mineral acquisition opportunities, availability and cost of insurance, labour disputes, land claims, the inherent uncertainty of production and cost estimates, currency fluctuations, expectations and beliefs of management and other risks and uncertainties, including those described under Risk Factors in the Company's Annual Information Form dated March 31, 2008, and in each subsequent Management's Discussion and Analysis. Such Forward-Looking Information is based upon the Company's assumptions regarding global and Chilean economic, political and market conditions and the price of metals, including copper and molybdenum, and future tailings production volumes and the Company's copper and molybdenum production. Among the factors that have a direct bearing on the Company's future results of operations and financial conditions are changes in project parameters as plans continue to be refined, interruptions in the supply of fresh tailings from El Teniente, further delays in the extraction of tailings from the Colihues tailings impoundment, a change in government policies, competition, currency fluctuations and restrictions and technological changes, among other things. Should one or more of any of the aforementioned risks and uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from any conclusions, forecasts or projections described in the Forward-Looking Information. Accordingly, readers are advised not to place undue reliance on Forward-Looking Information. Except as required under applicable securities legislation, the Company undertakes no obligation to publicly update or revise Forward-Looking Information, whether as a result of new information, future events or otherwise.

Contact Information

  • Amerigo Resources Ltd.
    Dr. Klaus Zeitler
    (604) 218-7013
    Amerigo Resources Ltd.
    (604) 697-6201