Augusta Resource Corporation (TSX/AMEX:
AZC; FRANKFURT: A5R) (“Augusta” or the “Company”) reports the Company
filed its first quarter financial statements today. During the first
quarter, the Company was pleased to deliver the 2007 Rosemont Deposit
Mineral Resource Estimate, which included 5.7 billion pounds (“lbs”) of
copper (“Cu”) and 157 million lbs of molybdenum (“Mo”) in measured and
indicated resources, and 1.5 billion lbs of Cu and 23 million lbs of Mo
in inferred resources. The estimate also included a new silver (“Ag”)
resource for the deposit, which quantified approximately 66.5 million
ounces (“oz”) of Ag in measured and indicated resources and 9.3 million
oz of Ag in inferred resources. On a copper equivalence basis, the
measured and indicated resource contains 8.4 billion lbs of Cu
equivalent, and 1.9 billion lbs of Cu equivalent in inferred resources*.
The new NI 43-101 compliant technical report on the Rosemont Property
was filed on SEDAR at www.sedar.com on April 26, 2007.
The Company also reports it has entered
into a Letter of Intent (“LOI”) with Ivana Ventures Inc. (“Ivana”)
respecting Augusta’s proposed sale of the Company’s interest in the Mt.
Hamilton and Shell properties, both of which are located in White Pine
County, Nevada.
The LOI provides for the sale of 100% of
the shares of DHI Minerals Ltd., which owns 100% of the shares of DHI
Minerals (U.S.) Ltd. (the “Subsidiaries”) which in turn holds a 100%
interest in each of the Mount Hamilton and Shell properties. Each
property is subject to a sliding scale net smelter royalty and, in the
case of the Mount Hamilton property, minimum advance royalty payments of
US$100,000 per year until November 9, 2010 when the minimum royalty
payments increase to US$300,000 per year. In the case of the Shell
property, annual advance royalty payments commencing at US$80,000 on the
first anniversary, increasing by US$20,000 per year until production
commences.
The consideration for the sale will be
US$6.5 million in cash, and warrants exercisable to purchase up to
3,000,000 shares of Ivana for eighteen months after closing at the price
of $0.50 per share. The cash portion of the purchase price will be
payable in installments over five years, with US$1,500,000 payable on
closing and an additional US$1,000,000 payable each 12 months
thereafter. The shares of the Subsidiaries will be pledged to the
Company as its sole recourse for non-payment of any portion of the
purchase price.
The proposed sale is subject to a 30 day
due diligence period in favour of Ivana, execution of a formal
agreement acceptable to both parties and acceptance of such agreement
for filing by the TSX Venture Exchange.
ABOUT AUGUSTA RESOURCE CORPORATION -
Augusta is a mineral exploration and development company responsibly
advancing the Rosemont copper project in Southern Arizona. The Company’s
Rosemont property is located in Pima County, approximately 50
kilometers southeast of Tucson, Arizona, and contains a potentially
world class open-pit copper/molybdenum/silver (“Cu/Mo/Ag”) deposit.
Augusta has a solid asset base, proven management team, and is committed
to becoming a mid-tier copper producer within five years. The company
is traded on the American Stock Exchange and the Toronto Stock Exchange
under the symbol AZC.
* Copper equivalence is based on prices of $1.25/lb Cu, $18.00/lb Mo and $8.50/oz Ag, with no applied recovery factors.
For additional information please visit www.augustaresource.com or contact:
ON BEHALF OF THE BOARD OF DIRECTORS
“Gil Clausen”
_________________________
Gil Clausen
President and CEO
CAUTIONARY STATEMENT REGARDING FORWARD LOOKING INFORMATION
Certain of the statements made and
information contained herein and in the documents incorporated by
reference may contain forward-looking statements or information within
the meaning of the United States Private Securities Litigation Reform Act of 1995 and forward looking statements or information within the meaning of the Securities Act (Ontario).
Forward- looking statements or information include statements regarding
the expectations and beliefs of management. Forward looking statements
or information include, but are not limited to, statements or
information with respect to known or unknown risks, uncertainties and
other factors which may cause the actual results, performance or
achievements of the Company, or industry results, to be materially
different from any future results, performance or achievements expressed
or implied by such forward- looking statements or information.
Forward-looking statements or information are subject to a variety of
risks and uncertainties which could cause actual events or results to
differ from those reflected in the forward-looking statements or
information, including, without limitation, risks and uncertainties
relating to the Company’s plans at its Rosemont Property and other
mineral properties, the interpretation of drill results and the
estimation of mineral resources and reserves, the geology, grade and
continuity of mineral deposits, the possibility that future exploration,
development or mining results will not be consistent with the Company’s
expectations, metal recoveries, accidents, equipment breakdowns, title
matters, labor disputes or other unanticipated difficulties with or
interruptions in production and operations, the potential for delays in
exploration or development activities or the completion of feasibility
studies, the inherent uncertainty of production and cost estimates and
the potential for unexpected costs and expenses, commodity price
fluctuations, currency fluctuations, failure to obtain adequate
financing on a timely basis, the effect of hedging activities, including
margin limits and margin calls, regulatory restrictions, including
environmental regulatory restrictions and liability, the speculative
nature of mineral exploration, dilution, competition, loss of key
employees, and other risks and uncertainties, including those described
under “Risk Factors Relating to the Company’s Business” in the Company’s
Annual Information Form dated March 1, 2007. Should one or more of
these risks and uncertainties materialize, or should underlying
assumptions prove incorrect, actual results may vary materially from
those described in forward-looking statements. Accordingly, readers are
advised not to place undue reliance on forward-looking statements or
information. We do not expect to update forward-looking statements or
information continually as conditions change, and you are referred to
the full discussion of the Company’s business contained in the Company’s
reports filed with the securities regulatory authorities in Canada and
the United States.