FOR IMMEDIATE RELEASE – August 4, 2004

South American Gold and Copper Company Limited Announces Production Results for July 2004

Toronto, Ontario, Canada – South American Gold and Copper Company Limited (“the Company”) (Toronto Stock Exchange  Symbol SAG) is pleased to announce the preliminary unaudited production results of its 100% owned Pimenton gold/copper/silver mine for the month of July 2004, its first month of commercial operation:

Tons of Copper/Gold/Silver Flotation Concentrates Produced: 156.7 dry metric tons

Average grade of gold per ton:                                            3.27 ounces

Average grade of copper per ton:                                        17.25%

Average grade of silver per ton:                                           4.87 ounces

Tons of Knelson Gravity Circuit Gold Concentrates Produced: 3.45 dry metric tons

Average grade of gold per ton:                                            109.39 ounces

Average grade of silver per ton:                                           19.09 ounces

Average grade of copper per ton:                                        1.38%

Stephen W. Houghton, President and CEO, stated that we are continuing to make improvements in plant operations and in the operation of the Knelson Concentrator gravity circuit which is producing the gold concentrates.  For example, during the last ten days of July, the average grade of gold in the gold concentrates produced increased to 145 ounces of gold per ton, compared with 37.7 ounces of gold per ton averaged in the first 16 days of operation.  During the first twenty days of July, the estimated head grade of ore into the mill was approximately 0.247 ounces of gold per ton and 1.2% copper which was taken from earlier stockpiled lower grade ore and purposely used as plant feed while improvements were being made to the flotation process and operations of the Knelson Concentrator.

In the last ten days of July, the head grade of ore into the mill averaged 0.546 ounces per ton and 1.5% copper as higher grade production ore was fed into the plant,   This head grade is expected to improve to the originally projected head grade of 0.598 ounces per ton and 1.6% copper as further refinements are made to mining, explosive and ore extraction techniques.

Total tons of copper/gold/silver concentrate shipped to the Enami smelter at Ventana, Chile, in July were 222.9 dry metric tons, including 66.2 tons shipped in late June, but for which no sales proceeds were received until July.  The total sales value, net of smelter charges, of concentrate shipped to Enami during the month of July, based on the Company’s assay values were US $339,901.00.

No Knelson gravity circuit gold concentrates were shipped to Enami in July as terms for the purchase of gold concentrates by Enami had not been finalized.  On August 2, 2004, approximately three tons of Knelson gold concentrates which had been produced in the first 29 days of July were shipped to Enami, having a value of approximately US $86,000 net of smelter charges.  Had it been possible to ship these gold concentrates in the last days of July, total revenues for the month of July would have been US $425,900, however proceeds from this shipment will now be reflected in August 2004 revenues.

Under contract agreements with Enami, payment for 90% of the metal value based on the Company assays is paid for in the week following delivery.  The balance is paid in the month following shipment, net of final assay settlement values between the Company’s assays, the Enami assays and adjustments to the gold price paid by Enami in July.  The contract also specifies that for the months of January through June, Enami pays a gold price based on the average price of gold for the prior month, with the exception of shipments of concentrates received in the months of July and August when Enami will pay a gold price equal to the average gold price of the month of July.  For the months of September through December, the gold price paid reverts back to the method described for the period January through June.

As a result of this method of calculation by Enami, the gold price paid to Pimenton for gold contained in its gold and copper/gold/silver concentrates during July will be equal to the average gold price for the month of July, or US $398.97, before deduction of smelter and refining charges.  Final settlement payments will be received in August 2004.

All references to “the Company’s assays” in this news release were the assay results of Acme Laboratories, S.A., Santiago, Chile, with headquarters in Vancouver, B.C.  Under the terms of a three year agreement with Acme Laboratories, S.A., Acme has constructed and staffed a complete laboratory facility at the Pimenton mine site.  All sample preparation and assaying at Pimenton is conducted by the Acme on-site laboratory with periodic check samples sent to Acme’s Santiago laboratory.

We are pleased to make this announcement to our shareholders who have patiently waited for the Company to become a true producer of gold and gold/copper concentrates.

South American Gold and Copper Company Limited is a mineral exploration and development company with properties and activities currently focused in Chile.  Its common shares are listed on the Toronto Stock Exchange under the symbol “SAG.”