Amerigo delivers in Q2, pays dividend

Vancouver – Chilean copper producer Amerigo Resources (ARG-T) exceeded market expectations, posting strong second quarter profits.

Surging copper and molybdenum prices propelled earnings of US$4.6 million for the latest Q2, up substantially from the US$1.6 million earned in the corresponding quarter of 2004.

In light of the robust earnings, the company declared an interim dividend payment of 4.5 per share.

Copper production in the latest quarter was 7.07 million pounds, down slightly from the 7.5 million pounds in the preceding quarter due to certain mechanical issues with the tailings extraction equipment on the Colihues impoundment at Minera Valle Central (MVC).

With early commissioning of its molybdenum circuit in May, production of the metal came in at almost 156,000 pounds for essentially two months of operation.

Credits from moly production contributed to lower overall cash costs, before the El Teniente royalty, of US60 per pound of copper versus US91 per pound in the preceding quarter. Total costs (after royalties, depreciation and accretion) came in at US90 per pound, well below the US$1.14 in Q1-2005.

MVC has been producing copper concentrate for several years through the reprocessing of tailings from Codelco’s El Teniente mine in central Chile. Amerigo’s operation is forecast to produce 15,000 tonnes of copper (33 million pounds) and 600,000 pounds of molybdenum in 2005.