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
VANCOUVER, British Columbia, Oct. 12, 2021 (GLOBE NEWSWIRE) -- 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 $1.62 per pound (“/lb”) and 0.3 M lbs of molybdenum.
Q3-2021 copper production was at 109% of guidance2 (YTD-2021: 101% of guidance2), due to higher fresh tailings tonnage and grade. During the quarter, MVC also successfully completed a series of planned plant modifications which now allow it to process a higher throughput of fresh tailings without sacrificing recovery. Production from fresh tailings in Q3-2021 accounted for 54% of quarterly production.
Molybdenum production in Q3-2021 was at 100% of guidance2 (YTD-2021: 95% of guidance2), marginally affected as more copper production comes from fresh tailings than from Cauquenes, as fresh tailings have lower molybdenum content.
Q3-2021 | Q2-2021 | Q1-2021 | Q4-2020 | Q3-2020 | |
Fresh tailings | |||||
Tonnes per day | 137,650 | 129,153 | 128,238 | 136,011 | 119,285 |
Operating days | 84 | 89 | 90 | 92 | 92 |
Tonnes processed | 11,562,611 | 11,533,405 | 11,541,378 | 12,512,980 | 10,974,235 |
Copper grade | 0.152% | 0.144% | 0.143% | 0.135% | 0.136% |
Copper recovery | 22.3% | 20.2% | 19.3% | 19.3% | 20.4% |
Copper produced (M lbs) | 8.62 | 7.37 | 7.03 | 7.17 | 6.68 |
Cauquenes tailings | |||||
Tonnes per day | 52,981 | 54,026 | 55,457 | 54,541 | 54,292 |
Operating days | 81 | 87 | 87 | 91 | 79 |
Tonnes processed | 4,267,203 | 4,701,475 | 4,811,171 | 4,985,031 | 4,362,040 |
Copper grade | 0.238% | 0.230% | 0.242% | 0.247% | 0.245% |
Copper recovery | 33.0% | 31.9% | 33.1% | 34.2% | 34.5% |
Copper produced (M lbs) | 7.37 | 7.61 | 8.47 | 9.28 | 8.00 |
Copper produced (M lbs) | 15.99 | 14.99 | 15.50 | 16.45 | 14.68 |
Copper delivered (M lbs) | 16.90 | 15.13 | 15.11 | 15.90 | 14.92 |
Cash cost ($/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 |
“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/lb3 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 investors 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
Aurora Davidson | Graham Farrell |
President and CEO | Investor Relations |
(604) 697-6207 | (416) 842-9003 |
ad@amerigoresources.com | Graham.Farrell@HarborAccessLLC.com |
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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.
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 administration costs, net of by-product credits. Cash cost per pound produced is based on pounds 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 release because it provides a key performance measure used by management to monitor operating performance, assess corporate performance, 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:
These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such statements. Inherent in forward-looking statements are risks and uncertainties beyond our ability to predict or control, including risks that may affect our operating or capital plans; risks generally encountered 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, ground control problems, adverse weather conditions, process upsets and equipment 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 subject 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 from tailings deposit; the availability 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 environmental compliance and changes in environmental legislation and regulation; risks associated with our dependence on third parties for the provision of critical services; risks associated with non-performance by contractual counterparties; title risks; social and political 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 that 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, therefore these risks and uncertainties may also affect their operations and in turn have a material effect on the Company.
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:
Future production levels and cost estimates assume there are no adverse mining or other events which significantly affect budgeted 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 difficult or impossible to predict and are beyond the Company’s control, the Company cannot assure that it will achieve or accomplish the expectations, beliefs or projections described in the forward-looking 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 forward-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.