Amerigo Resources Ltd. (TSX: ARG) has unveiled production results for the quarter ended June 30, 2022 from Minera Valle Central (MVC), the company’s 100% owned operation located near Rancagua, Chile.
“We are pleased to report another strong operational quarter which included our nine-day annual maintenance programme shutdown,” President and CEO, Aurora Davidson, said.
“Amerigo’s operations met expectations before and after the scheduled shutdown and produced 14.9 million pounds of copper. As always, our maintenance shutdown quarter will be our lowest production quarter of the year.
“For the full year, we expect to exceed copper production guidance by three per cent, annual production costs to remain aligned with guidance, and we reaffirm the company’s commitment to returning capital to shareholders.”
“Price volatility is a normal feature of the copper market. However, over the past several years we have transformed Amerigo into a company that is ready for the long-term, regardless of copper price volatility.
“We continue to see strong market fundamentals supporting copper prices and have a robust balance sheet designed to weather market volatility while protecting the regular quarterly dividend of Cdn$0.03 per share.
“We are monitoring market conditions to determine the optimum time to trigger additional performance dividends as part of our return of capital to shareholders.”
In Q2-2022, MVC produced 14.9 million pounds (“M lbs”) of copper at a cash cost1 of $2.01 per pound (“/lb”) with 61% of MVC’s copper production coming from fresh tailings. By successfully prioritizing the processing of fresh tailings, water is preserved and mineral resource depletion at Cauquenes is delayed, all without lowering copper production. For the first half of 2022, copper production totalled 31.4 M lbs of copper at a cash cost of $1.95/lb.
Lower copper production in Q2-2022, because of the scheduled annual maintenance shutdown, resulted in a higher-than-normal quarterly cash cost of $2.01/lb. Based on the Company’s modelling, annual cash cost is trending towards $1.96/lb, approximately 3% higher than guidance. This cash cost variance is attributable to lower molybdenum by-product credits from lower than anticipated molybdenum production. All other production costs remain aligned with Amerigo’s budget/guidance.
MVC’s water reserves on June 30, 2022, were 5.2 million cubic metres, an increase of 16% over the previous quarter. These water reserves continue to be sufficient for MVC to maintain projected processing for a period of at least eighteen months.
MVC’s operations have continued without any significant disruptions due to Covid-19.
Molybdenum production in the quarter was 0.2 M lbs, trending below guidance mostly due to lower molybdenum content in fresh tailings.
The company’s quarterly copper price in Q2-2022 was $4.10/lb, compared to $4.64/lb in Q1-2022.
In Q2-2022, Amerigo returned US$13.0 million to shareholders: $4.1 million were paid through Amerigo’s regular quarterly dividend of Cdn$0.03 per share, and $8.9 million were returned through the purchase of 6.9 million common shares for cancellation through Amerigo’s recently completed Normal Course Issuer Bid. Amerigo also made scheduled debt repayments of $3.5 million in the quarter.
On June 30, 2022, the company’s cash and restricted cash balance was US$57.2 million.
For further information please visit: http://www.amerigoresources.com/
