Amerigo Reports Q3-2021 Production Results Quarterly copper production of 16 million pounds, 9% over Q3 guidance Cash cost of $1.62/lb, 8% below Q3 guidance and lowest quarterly cash cost of 2021 Annual MVC plant maintenance shutdown successfully completed on schedule
October 12, 2021
N.R. 2021-15
Amerigo Reports Q3-2021 Production Results
Quarterly copper production of 16 million pounds, 9% over Q3 guidance
Cash cost of $1.62/lb, 8% below Q3 guidance and lowest quarterly cash cost of 2021
Annual MVC plant maintenance shutdown successfully completed on schedule
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VANCOUVER, BRITISH COLUMBIA – October 12, 2021/Amerigo Resources Ltd. (TSX: ARG; ARREF:
OTC) is pleased to announce production results for the quarter ended September 30, 2021 (“Q3-2021”) from
Minera Valle Central ("MVC"), the Company’s 100% owned operation located near Rancagua, Chile. Dollar
amounts in this news release are in U.S. dollars.
In Q3-2021, MVC produced 16 million pounds (“M lbs”) of copper at a cash cost1 of $1.62 per pound (“/lb”) and
0.3 M lbs of molybdenum.
Q3-2021 copper production was at 109% of guidance 2 (YTD-2021: 101% of guidance 2), due to higher fresh
tailings tonnage and grade. During the quarter, MVC also successfully completed a series of planned plant
modifications which now allow it to process a higher throughput of fresh tailings without sacrificing recovery.
Production from fresh tailings in Q3-2021 accounted for 54% of quarterly production.
Molybdenum production in Q3-2021 was at 100% of guidance 2 (YTD-2021: 95% of guidance 2), marginally
affected as more copper production comes from fresh tailings than from Cauquenes, as fresh tailings have lower
molybdenum content.
Q3-2021 Q2-2021 Q1-2021 Q4-2020 Q3-2020
Fresh tailings
Tonnes per day 137,650 129,153 128,238 136,011 119,285
Operating days 84 89 90 92 92
Tonnes processed 11,562,611 11,533,405 11,541,378 12,512,980 10,974,235
Copper grade 0.152% 0.144% 0.143% 0.135% 0.136%
Copper recovery 22.3% 20.2% 19.3% 19.3% 20.4%
Copper produced (M lbs) 8.62 7.37 7.03 7.17 6.68
Cauquenes tailings
Tonnes per day 52,981 54,026 55,457 54,541 54,292
Operating days 81 87 87 91 79
Tonnes processed 4,267,203 4,701,475 4,811,171 4,985,031 4,362,040
Copper grade 0.238% 0.230% 0.242% 0.247% 0.245%
Copper recovery 33.0% 31.9% 33.1% 34.2% 34.5%
Copper produced (M lbs) 7.37 7.61 8.47 9.28 8.00
Copper produced (M lbs) 15.99 14.99 15.50 16.45 14.68
Copper delivered (M lbs) 16.90 15.13 15.11 15.90 14.92
Cash cost ($/lb) 1.62 1.81 1.88 1.65 1.80
Molybdenum produced (M lbs) 0.32 0.33 0.40 0.50 0.37
Molybdenum sold (M lbs) 0.34 0.33 0.36 0.50 0.37
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“Amerigo completed Q3-2021 with very strong production results. The annual plant maintenance shutdown was
completed successfully and on schedule, and full production operations resumed on October 2, 2021. A total of
1,390 maintenance tasks and projects were completed safely and on time by our team in Chile to ensure MVC’s
plant continues to operate as expected”, said Aurora Davidson, Amerigo’s President and CEO.
Q3-2020 cash cost of $1.62/lb was 8% lower than the Company’s Q3 cash cost guidance of $1.76/lb 3 due to
higher than projected production and lower than anticipated power, steel and lime costs.
MVC’s average copper price in Q3-2021 was $4.23/lb, compared to $4.44/lb in Q2-2021.
On September 30, 2021, the Company’s cash and restricted cash balance was $71 million (an increase of $18
million from June 30, 2021) and outstanding bank debt was $35 million (unchanged from June 30, 2021).
Release of Q3-2021 financial results on November 3, 2021
Amerigo will release Q3-2021 financial results at market open on Wednesday, November 3, 2021.
Investor conference call on November 4, 2021
Amerigo’s quarterly investor conference call will take place on Thursday, November 4, 2021, at 11:00 am Pacific
Time/2:00 pm Eastern Time. To join the call, please dial 1-888-664-6392 (Toll-Free North America) and enter
confirmation number 79182997.
121 Mining Investment Online Americas
Amerigo will be participating in the 121 Mining Investment Online Americas conference from October 13 to 15,
2021. CEO Aurora Davidson will be available for one-on-one meetings with investors for the duration of the event.
The 121 Mining Investment conference connects senior inve stors from institutional funds, private equity groups,
family offices and sector analysts that are based in Canada and USA, through one-on-one investor meetings
hosted virtually.
About Amerigo and MVC
Amerigo Resources Ltd. is an innovative copper producer with a long-term relationship with Corporación
Nacional del Cobre de Chile (“Codelco”), the world’s largest copper producer.
Amerigo produces copper concentrate and molybdenum concentrate as a by-product at the MVC operation in
Chile by processing fresh and historic tailings from Codelco’s El Teniente mine, the world's largest underground
copper mine. Tel: (604) 681-2802; Fax: (604) 682-2802; Web: www.amerigoresources.com; Listing: ARG:TSX.
Contact Information
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1 Cash cost is a non-IFRS financial performance measure. Refer to “Non-IFRS Measures” at the end of this press release.
2 Annual production guidance provided in Amerigo’s news release of January 14, 2021.
3 Updated cash cost guidance provided in Amerigo’s Q2-2021 MD&A.
Aurora Davidson Graham Farrell
President and CEO Investor Relations
(604) 697-6207 (416) 842-9003
[email protected] [email protected]
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Non-IFRS Measures
This news release includes “cash cost”, which is a performance measure commonly used in the mining industry that is not defined under
International Financial Reporting Standards (“IFRS”). Cash cost is the aggregate of smelting and refining charges, tolling/production costs
net of inventory adjustments and administrati on costs, net of by-product credits. Cash cost per pound produced is based on pou nds of
copper produced and is calculated by dividing cash cost over the number of pounds of copper produced.
This non-IFRS performance measure is included in this news re lease because it provides a ke y performance measure used by
management to monitor operating performance, assess corporate perf ormance, and to plan and assess the overall effectiveness and
efficiency of Amerigo’s operations. This performance measure is not a standardized financial measure under IFRS and, therefore, amounts
presented may not be comparable to similar financial measures disclosed by other companies. This performance measure should not be
considered in isolation as a substitute for measures of performance in accordance with IFRS.
Cautionary Note Regarding Forward-Looking Information
This news release contains certain forward-looking information and statements as defined in applicable securities laws (collectively referred
to as "forward-looking statements"). These statements relate to future events or the Company’s future performance. All statements other
than statements of historical fact are forward-looking statements. The use of any of the words "anticipate", "plan", "continue", "estimate",
"expect", "may", "will", "project", "predict ", "potential", "should", "believe" and similar expressions is intended to identify forward-looking
statements. These forward-looking statements include but are not limited to, statements concerning:
• forecasted production, reductions in operating costs and an increase in recoveries;
• our strategies and objectives;
• our estimates of the availability and quantity of tailings, and the quality of our mine plan estimates;
• prices and price volatility for copper, molybdenum and other commodities and of materials we use in our operations;
• the demand for and supply of copper, molybdenum and other commodities and materials that we produce, sell and use;
• sensitivity of our financial results and share price to changes in commodity prices;
• our financial resources and our expected ability to meet our obligations for the next 12 months;
• interest and other expenses;
• domestic and foreign laws affecting our operations;
• our tax position and the tax rates applicable to us;
• our ability to comply with our loan covenants;
• the production capacity of our operations, our planned production levels and future production;
• potential impact of production and transportation disruptions;
• hazards inherent in the mining industry causing personal inju ry or loss of life, severe damage to or destruction of property and
equipment, pollution or environmental damage, claims by third parties and suspension of operations
• estimates of asset retirement obligations and other costs related to environmental protection;
• our future capital and production costs, including the costs and potential impact of complying with existing and proposed environmental
laws and regulations in the operation and closure of our operations;
• repudiation, nullification, modification or renegotiation of contracts;
• our financial and operating objectives;
• our environmental, health and safety initiatives;
• the outcome of legal proceedings and other disputes in which we may be involved;
• the outcome of negotiations concerning metal sales, treatment charges and royalties;
• disruptions to the Company's information technology systems, including those related to cybersecurity;
• our dividend policy; and
• general business and economic conditions.
These forward-looking stat ements involve known and unknown ri sks, uncertainties and ot her factors that may cause actual results or
events to differ materially from those ant icipated in such statements. Inherent in forward-looking statements are risks and unc ertainties
beyond our ability to predict or control, including risks that may affect our operating or capital plans; risks generally encou ntered in the
permitting and development of mineral projects such as unusual or unexpected geological formations, negotiations with government and
other third parties, unanticipated metallurgical difficulties, delays associated with permits, approvals and permit appeals, gr ound control
problems, adverse weather conditions, process upsets and equip ment malfunctions; risks associated with labour disturbances and
availability of skilled labour and management; risks related to the potential impact of global or national health concerns, including COVID-
19, and the inability of employees to access sufficient healthcare; government or regulatory actions or inactions; fluctuations in the market
prices of our principal commodities, which are cyclical and s ubject to substantial price fluctuations; risks created through competition for
mining projects and properties; risks associated with lack of access to markets; risks associated with availability of and our ability to obtain
both tailings from Codelco’s Division El Teniente’s current production and historic tailings fr om tailings deposit; the availab ility of and
ability of the Company to obtain adequate funding on reasonable terms for expansions and acquisitions; mine plan estimates; risks posed
by fluctuations in exchange rates and interest rates, as well as general economic conditions ; risks associated with environment al
compliance and changes in environmental legislation and regulatio n; risks associated with our dependence on third parties for t he
provision of critical services; risks asso ciated with non-performance by contractual count erparties; title risks; social and po litical risks
associated with operations in foreign countries; risks of changes in laws affecting our operations or their interpretation, including foreign
exchange controls; and risks associated with tax reassessments and legal proceedings. Notwithstanding the efforts of the Company and
MVC, there can be no guarantee t hat the Company’s or MVC’s staff will not contract COVID-19 or that the Company’s and MVC’s
measures to protect staff from COVID-19 will be effective. Many of these risks and uncertainties apply not only to the Company and its
operations, but also to Codelco and its operations. Codelco’s ongoing mining operations provide a significant portion of the materials the
Company processes and its resulting metals production, therefor e these risks and uncertainties may also affect their operations and in
turn have a material effect on the Company.
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Actual results and developments are likely to differ, and may differ materially, from those expressed or implied by the forward -looking
statements contained in this news release. Such statements are based on several assumptions which may prove to be incorrect, including,
but not limited to, assumptions about:
• general business and economic conditions;
• interest rates;
• changes in commodity and power prices;
• acts of foreign governments and the outcome of legal proceedings;
• the supply and demand for, deliveries of, and the level and volat ility of prices of copper, moly bdenum and other commodities an d
products used in our operations;
• the ongoing supply of material for processing from Codelco’s current mining operations;
• the grade and projected recoveries of tailings processed by MVC;
• the ability of the Company to profitably extract and process material from the Cauquenes tailings deposit;
• the timing of the receipt of and retention of permits and other regulatory and governmental approvals;
• our costs of production and our production and productivity levels, as well as those of our competitors;
• changes in credit market conditions and conditions in financial markets generally;
• our ability to procure equipment and operating supplies in sufficient quantities and on a timely basis;
• the availability of qualified employees and contractors for our operations;
• our ability to attract and retain skilled staff;
• the satisfactory negotiation of collective agreements with unionized employees;
• the impact of changes in foreign exchange rates and capital repatriation on our costs and results;
• engineering and construction timetables and capital costs for our expansion projects;
• costs of closure of various operations;
• market competition;
• tax benefits and tax rates;
• the outcome of our copper concentrate sales and treatment and refining charge negotiations;
• the resolution of environmental and other proceedings or disputes;
• the future supply of reasonably priced power;
• rainfall in the vicinity of MVC continuing to trend towards normal levels;
• average recoveries for fresh tailings and Cauquenes tailings;
• our ability to obtain, comply with and renew permits and licenses in a timely manner; and
• our ongoing relations with our employees and entities with which we do business.
Future production levels and cost estimates assume there are no adverse mining or other events which significantly affect budge ted
production levels.
Although the Company believes that these assumptions were reasonable when made, because these assumptions are inherently subject
to significant uncertainties and contingencies which are diffic ult or impossible to predict and are beyond the Company’s contro l, the
Company cannot assure that it will achieve or accomplish the ex pectations, beliefs or projections described in the forward-look ing
statements.
We caution you that the foregoing list of important factors and assumptions is not exhaustive. Other events or circumstances could cause
our actual results to differ materially from those estimated or projected and expressed in, or implied by, our forward-looking statements.
You should also carefully consider the matters discussed under Risk Factors in the Company`s Annual Information Form. The forwa rd-
looking statements contained herein speak only as of the date of this news release and except as required by law, we undertake no
obligation to update publicly or otherwise revise any forward-looking statements or the foregoing list of factors, whether as a result of new
information or future events or otherwise.