Q2-2023 copper production of 13.6 million pounds

MVC currently producing copper using a secondary power source

Q2-2023 cash cost¹ of $2.37 per pound

$4.5 million returned to shareholders in Q2-2023

Amerigo Resources Ltd. (TSX: ARG) (OTCQX: ARREF) announces production results for the quarter ended June 30, 2023 from Minera Valle Central, the Company’s 100% owned operation located near Rancagua, Chile. Dollar amounts in this news release are in U.S. dollars (“USD”) unless indicated otherwise.

“MVC’s copper production in the second quarter was 13.6 million pounds. As expected, the quarter was impacted by our 8-day annual plant maintenance shutdown but unexpectedly impacted by a full shutdown on June 23, 2023, through the end of the quarter. The extraordinary flooding that severed MVC’s connection to Chile’s central power grid, causing the shutdown, resulted in 1.3 million pounds of lost copper production in June,” said Aurora Davidson, Amerigo’s President and CEO.

Ms. Davidson added, “Using additional sources of secured power, on July 6, 2023, MVC began processing fresh tailings from El Teniente and producing 90,000 pounds of copper daily. Repair work to the infrastructure necessary for reconnection to Chile’s central power grid is underway, including a revised work program with additional upgrades and repairs to increase safety levels from a similar climatic event. We currently expect fully restored operations at MVC during the last week of July.”

In Q2-2023, MVC produced 13.6 million pounds (“M lbs”) of copper, with 65% of production coming from fresh tailings. Copper production to the end of May 2023 was trending 4% over guidance. As a result of the lost production due to the climatic event, cumulative production to June 30, 2023 of 30.15 M lbs was 1.5% below guidance. Amerigo’s 2023 adjusted copper production guidance of 60.5 M lbs, reflecting the impact of the unexpected shutdown and announced to the market on June 30, 2023, remains in place.

Q2-2023 molybdenum production was 0.3 M lbs. YTD molybdenum production of 0.6 M lbs is 10.3% over guidance. Amerigo’s annual molybdenum production guidance remains at 1.0 M lbs.

Amerigo’s cash cost¹ in Q2-2023 was $2.37 per pound (“/lb”), higher than in preceding quarters, primarily due to lower production. Before the interruption of operations due to the climatic event, MVC’s YTD cash cost¹ was $2.09/lb, below guidance.

Amerigo’s quarterly copper price in Q2-2023 was $3.80/lb, compared to $4.02/lb in Q1-2023, and the Company’s molybdenum price was $20.76/lb, down from $31.73/lb in Q1-2023.

On June 30, 2023, cash was $31.7 million (a decrease of $6.1 million from December 31, 2022), and restricted cash was $4.2 million (unchanged from December 31, 2022). Outstanding bank debt was $21.0 million, compared to $24.5 million on December 31, 2022.

On June 30, 2023, MVC’s water reserves were over 10.0 million cubic meters, compared to 4.7 million cubic meters on March 31, 2023. Water reserves are sufficient to maintain projected Cauquenes processing rates for at least eighteen months, our maximum forecast horizon.

Capital Return Strategy

Amerigo’s quarterly dividend remains secure based on the Company’s adjusted production guidance, released on June 30, 2023. In Q2-2023, Amerigo returned $3.7 million to shareholders through the Company’s seventh consecutive quarterly dividend of Cdn$0.03 per share, and $0.8 million was returned through the purchase of 0.7 million common shares for cancellation through Amerigo’s ongoing Normal Course Issuer Bid.

Since the implementation of Amerigo’s Capital Return Strategy (the “Strategy”) in September 2021, the Company has paid a cumulative dividend of Cdn$0.20 per share ($25.9 million) and used $23.7 million to purchase and cancel 20.1 million of its common shares, an 11.1% reduction in the number of common shares outstanding at the inception of the Strategy.

Release of Q2-2023 financial results on August 2, 2023

Amerigo will release Q2-2023 financial results at the market open on Wednesday, August 2, 2023.

About Amerigo and MVC

Amerigo is an innovative copper producer with a long-term relationship with Corporación Nacional del Cobre de Chile 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.