ARG:CC - Amerigo Reports Q3-2022 Production Results

(NewsDirect)

Amerigo ResourcesLtd. (TSX: ARG; OTCQX: ARREF) (“Amerigo” or the “Company”)is pleased to announce production results for the quarter endedSeptember 30, 2022 (“Q3-2022”) from Minera Valle Central("MVC"), the Company’s 100% owned operation located nearRancagua, Chile. Dollar amounts in this news release are in U.S.dollars unless indicated otherwise .

“We are pleased to report another strongoperational quarter with production of 16 million pounds of copper ata cash cost ¹ of $1.93 per pound. With one quarter to go, weremain confident we will exceed our annual copper production guidanceby 3%,” said Aurora Davidson, Amerigo’s President and CEO.

“Copper pricevolatility continued during the quarter, with an average Q3-2022copper price of $3.50 per pound, $0.60 lower than the average price ofQ2-2022,” said Ms. Davidson. “However, at these average copperprices, Amerigo has a strong balance sheet that can absorb the copperprice volatility and sustain the Company’s quarterly dividend ofCdn$0.03 per share. We continue to see robust copper marketfundamentals, despite the pressure of the US dollar strengthening totwenty-year highs. As the market fundamentals reassert themselves, weare confident we will be able to redeploy share buybacks and/orperformance dividends as part of our capital return strategy. Thesetools will be additive to the quarterly dividend, building upon thevery attractive investment yield that is currently in place,” sheadded.

InQ3-2022, MVC produced 16.0 million pounds (“M lbs”) of copper at acash cost ¹ of $1.93 per pound (“/lb”) with 54% ofMVC’s copper production coming from fresh tailings. During August,the Company demonstrated its operational flexibility and metproduction targets by processing more historical tailings fromCauquenes to offset a lower volume of fresh tailings from El Teniente.

For the ninemonths ended September 30, 2022, copper production totaled 47.4 M lbsof copper at a cash cost ¹ of $1.94/lb.

Based on theCompany’s modeling, annual production is expected to be 63.8 M lbsof copper (3% over guidance) with cash cost ¹ trendingtowards $1.95/lb, approximately 3% higher than guidance. This cashcost ¹ variance is attributable to lower than anticipatedmolybdenum production and byproduct credits. When viewed in theaggregate, all other production costs remain aligned with Amerigo’sbudget/guidance.

MVC’s water reserves on September 30, 2022 were 5.4 million cubicmeters, 0.2 million higher than at the end of Q2-2022. These waterreserves remain sufficient to maintain projected Cauquenes processingrates for a period of at least eighteen months, our maximum forecasthorizon.

Molybdenum production in the quarter was 0.3 M lbs, continuing totrend below guidance mostly due to lower molybdenum content in freshtailings.

TheCompany’s quarterly copper price in Q3-2022 was $3.50/lb, comparedto $4.10/lb in Q2-2022.

In Q3-2022, Amerigo returned $3.8 million to shareholdersthrough Amerigo’s regular quarterly dividend of Cdn$0.03 per share.

On September 30,2022, the Company’s cash and restricted cash balance was $48.2million.

Release of Q3-2022results on November 2, 2022

Amerigo will release Q3-2022 financial results atmarket open on Wednesday, November 2, 2022.

Investor conference call on November 3, 2022

Amerigo’s quarterlyinvestor conference call will take place on Thursday, November 3, 2022at 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 enterconfirmation number 99826991 .

Upcoming Investor ConferenceParticipation

Amerigo will be participating in the Grizzle BatteryMetals conference on October 20, 2022, and the 121Global Online Tech Metals conference on October 25 and 26,2022. CEO Aurora Davidson will be available for one-on-one meetingsthroughout the second event.

About Amerigo and MVC

Amerigo Resources Ltd.is an innovative copper producer with a long-term relationship withCorporación Nacional del Cobre de Chile (“Codelco”), theworld’s largest copper producer.

Amerigo produces copper concentrate and molybdenumconcentrate as a by-product at the MVC operation in Chile byprocessing fresh and historic tailings from Codelco’s El Tenientemine, the world's largest underground copper mine. Tel: (604)681-2802; Web: www.amerigoresources.com ;Listing: ARG:TSX.

¹ Non-IFRS Measures

This news release includes references to cash cost, a performancemeasure not defined under International Financial Reporting Standards(“IFRS”). Cash cost is a performance measure commonly used in themining industry. In Amerigo’s case, cash cost is the aggregate ofsmelting and refining charges, tolling/production costs net ofinventory adjustments and administration costs, net of by-productcredits. Cash cost per pound produced is based on pounds of copperproduced and is calculated by dividing cash cost over the number ofpounds of copper produced.

Cash cost is included in this news release becauseit is a key performance measure used by management to monitoroperating performance, assess corporate performance, and to plan andassess the overall effectiveness and efficiency of Amerigo’soperations. Performance measures such as cash cost are notstandardized financial measures under IFRS and, therefore, amountspresented may not be comparable to similar financial measuresdisclosed by other companies. These performance measures should not beconsidered in isolation as a substitute for measures of performance inaccordance with IFRS and should be read in conjunction with theCompany’s consolidated financial statements. Readers should refer toAmerigo’s Management’s Discussion and Analysis, available on SEDARat www.sedar.com , under the heading“Non-IFRS Measures” for a more detailed discussion of how Amerigocalculates cash cost and a reconciliation of cash cost against IFRSmeasures.

Cautionary Note Regarding Forward-Looking Information

This news release contains certain forward-looking information andstatements as defined in applicable securities laws (collectivelyreferred to as "forward-looking statements"). These statementsrelate to future events or the Company’s future performance. Allstatements other than statements of historical fact areforward-looking statements. The use of any of the words"anticipate", "plan", "continue","estimate", "expect", "may", "will","project", "predict", "potential","should", "believe" and similar expressions isintended to identify forward-looking statements. These forward-lookingstatements include but are not limited to, statements concerning:

• forecasted production and operatingcosts;

• our strategies andobjectives;

• our estimatesof the availability and quantity of tailings, and the quality of ourmine plan estimates;

• thesufficiency of MVC’s water reserves to maintain projected Cauquenestonnage processing for a period of at least 18 months;

• prices and pricevolatility for copper, molybdenum and other commodities and ofmaterials we use in our operations;

• the demand for and supply of copper,molybdenum and other commodities and materials that we produce, selland use;

• sensitivity of our financial results and share price to changesin commodity prices;

• our financial resources and financial conditionand our expected ability to redeploy other tools of our capital returnstrategy;interest and other expenses;

• domestic and foreign laws affecting ouroperations;

• our tax position and the tax rates applicable tous;

• ourability to comply with our loan covenants;

• the production capacity of our operations,our planned production levels and future production;

• potential impact of production andtransportation disruptions;

• hazards inherent in the mining industry causing personalinjury or loss of life, severe damage to or destruction of propertyand equipment, pollution or environmental damage, claims by thirdparties and suspension of operations

• estimates of asset retirement obligations and other costsrelated to environmental protection;

• our future capital and production costs,including the costsand potential impact of complying with existing and proposedenvironmental laws and regulations in the operation and closure of ouroperations;

• repudiation, nullification, modification or renegotiation ofcontracts;

• our financial and operating objectives;

• our environmental,health and safety initiatives;

• the outcome of legal proceedings andother disputes in which we may be involved;

• the outcome ofnegotiations concerning metal sales, treatment charges androyalties;

• disruptions to the Company's information technology systems,including those related to cybersecurity;

• our dividend policy;and

• general business andeconomic conditions, including, but not limited to, our assessment ofstrong market fundamentals supporting copper prices.

These forward-looking statements involve knownand unknown risks, uncertainties and other factors that may causeactual results or events to differ materially from those anticipatedin such statements. Inherent in forward-looking statements are risksand uncertainties beyond our ability to predict or control, includingrisks that may affect our operating or capital plans; risks generallyencountered in the permitting and development of mineral projects suchas unusual or unexpected geological formations, negotiations withgovernment and other third parties, unanticipated metallurgicaldifficulties, delays associated with permits, approvals and permitappeals,ground control problems,adverse weather conditions, processupsets and equipment malfunctions; risks associated with labourdisturbances and availability of skilled labour and management; risksrelated to the potential impact of global or national health concerns,including COVID-19, and the inability of employees to accesssufficient healthcare; government or regulatory actions or inactions;fluctuations in the market prices of our principal commodities, whichare cyclical and subject to substantial price fluctuations; riskscreated through competition for mining projects and properties; risksassociated with lack of access to markets; risks associated withavailability of and our ability to obtain both tailings fromCodelco’s Division El Teniente’s current production and historictailings from tailings deposit; the availability of and ability of theCompany to obtain adequate funding on reasonable terms for expansionsand acquisitions; mine plan estimates; risks posed by fluctuations inexchange rates and interest rates, as well as general economicconditions; risks associated with environmental compliance and changesin environmental legislation and regulation; risks associated with ourdependence on third parties for the provision of critical services;risks associated with non-performance by contractual counterparties;risks associated with supply chain disruptions; title risks; socialand political risks associated with operations in foreign countries;risks of changes in laws affecting our operations or theirinterpretation, including foreign exchange controls; and risksassociated with tax reassessments and legal proceedings.Notwithstanding the efforts of the Company and MVC, there can be noguarantee that the Company’s or MVC’s staff will not contractCOVID-19 or that the Company’s and MVC’s measures to protect stafffrom COVID-19 will be effective. Many of these risks and uncertaintiesapply not only to the Company and its operations, but also to Codelcoand its operations. Codelco’s ongoing mining operations provide asignificant portion of the materials the Company processes and itsresulting metals production, therefore these risks and uncertaintiesmay also affect their operations and in turn have a material effect onthe Company.

Actual results and developments are likely todiffer, and may differ materially, from those expressed or implied bythe forward-looking statements contained in this news release. Suchstatements are based on several assumptions which may prove to beincorrect, including, but not limited to, assumptionsabout:

• general business and economic conditions;

• interest and currencyexchange rates;

• changes in commodity and powerprices;

• acts of foreign governments and the outcome of legalproceedings;

• the supply and demand for, deliveries of, and the level andvolatility of prices of copper, molybdenum and other commoditiesand products used in our operations;

• the ongoing supply of material forprocessing from Codelco’s current mining operations;

• the grade and projectedrecoveries of tailings processed by MVC;

• the ability of theCompany to profitably extract and process material from the Cauquenestailings deposit;

• the timing of the receipt of and retention ofpermits and other regulatory and governmentalapprovals;

• our costs of production and our production and productivitylevels, as well as those of our competitors;

• changes in creditmarket conditions and conditions in financial marketsgenerally;

• our ability to procure equipment and operating supplies insufficient quantities and on a timely basis;

• the availability ofqualified employees and contractors for our operations;

• our ability to attractand retain skilled staff;

• the satisfactory negotiation of collectiveagreements with unionized employees;

• the impact of changes in foreign exchangerates and capital repatriation on our costs andresults;

• engineering and construction timetables and capital costs forour expansion projects;

• costs of closure of variousoperations;

• market competition;

• tax benefits and tax rates;

• the outcome of ourcopper concentrate sales and treatment and refining chargenegotiations;

• the resolution of environmental and other proceedings ordisputes;

• the future supply of reasonably priced power;

• rainfall in thevicinity of MVC continuing to trend towards normallevels;

• average recoveries for fresh tailings and Cauquenestailings;

• our ability to obtain, comply with and renew permits andlicenses in a timely manner; and

• our ongoing relations with our employees and entities withwhich we do business.

Future production levels and cost estimatesassume there are no adverse mining or other events which significantlyaffect budgeted production levels.

Although the Company believes that theseassumptions were reasonable when made, because these assumptions areinherently subject to significant uncertainties and contingencieswhich are difficult or impossible to predict and are beyond theCompany’s control, the Company cannot assure that it will achieve oraccomplish the expectations, beliefs or projections described in theforward-looking statements.

We caution you that the foregoing list ofimportant factors and assumptions is not exhaustive. Other events orcircumstances could cause our actual results to differ materially fromthose estimated or projected and expressed in, or implied by, ourforward-looking statements. You should also carefully consider thematters discussed under Risk Factors in the Company`s AnnualInformation Form. The forward-looking statements contained hereinspeak only as of the date of this news release and except as requiredby law, we undertake no obligation to update publicly or otherwiserevise any forward-looking statements or the foregoing list offactors, whether as a result of new information or future events orotherwise.

Contact Details

Aurora Davidson,President and CEO

+1 604-697-6207

ad@amerigoresources.com

GrahamFarrell, Investor Relations

+1 416-842-9003

Graham.Farrell@Harbor-Access.com

CompanyWebsite

http://www.amerigoresources.com/

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