Amerigo Announces Short Term Copper Hedging Program
VANCOUVER, BRITISH COLUMBIA – June 19/Amerigo Resources Ltd. (TSX:ARG) (“Amerigo” or the “Company”) announced that its fully owned subsidiary, Minera Valle Central (“MVC”), has entered into a facility to hedge a portion of its copper production for the second half of 2009 with MVC’s concentrate purchaser, Empresa Nacional de Minerίa (Enami), a Chilean state owned company, making use of a zero cost minimum/maximum structure. MVC has secured a minimum price of US$2.00 per pound for 800 tonnes per month of copper production which will be priced from July to December 2009, representing approximately 50% of MVC’s forecast copper production over that period. The facility sets a maximum price of US$2.47 per pound on this production. If the LME copper price trades between US$2.00 and US$2.47 per pound, MVC will receive the LME monthly average copper price for copper delivered under this facility. The facility includes standard provisions for a facility of this nature, including the potential requirement to provide to Enami additional guarantees subject to increases in the copper price.
Dr. Klaus Zeitler, President, stated "Although we believe the copper price will be strong in the medium to long-term, we feel that near term hedging is prudent risk management to secure our short term cash requirements and service the debt assumed by the Company during the recent market downturn. In addition, we maintain full upside potential on the 50% of our production that remains unhedged during this period."
Amerigo Resources Ltd. is a Canadian junior company producing copper and molybdenum from its MVC operations near Santiago, Chile. Tel: (604) 681-2802; Fax: (604) 682-2802; Web: www.amerigoresources.com; Listing: ARG:TSX
For further information, please contact:
Dr. Klaus Zeitler, President
The Toronto Stock Exchange has not reviewed nor accepted responsibility for the adequacy or accuracy of the contents of this news release, which has been prepared by management. This release includes certain statements that may be deemed "forward-looking statements". All statements in this release, other than statements of historical facts, that address future production, reserve potential, exploration drilling, exploitation activities and events or developments that the Company expects are forward-looking statements. Although the Company believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward-looking statements. Such risks and uncertainties are detailed in the Company’s filings with the TSX and on SEDAR. Factors that could cause actual results to differ materially from those in forward-looking statements include capital market conditions, commodities market prices, exploitation and exploration successes, lack of continuity of mineralization, continued availability of capital and financing, and general economic, market or business conditions. The Company undertakes no obligation to update these forward-looking statements if management’s beliefs, estimates or opinions, or other factors, should change.