SOUTH AMERICAN GOLD AND COPPER COMPANY LIMITED

Registered Office:
100 WELLINGTON STREET WEST, SUITE 500
TORONTO, ONTARIO M5K 1H1
CANADA

New York Representative Office:
420 MADISON AVENUE
NEW YORK, NY 10017
(212) 751-0083

Santiago Office:
LA CONCEPCION 266, OF. 704
PROVIDENCIA, SANTIAGO, CHILE
Telephone : 56-2-264-2295
E-Mail: sagc@sagchile.cl

For further information, contact:
Stephen W. Houghton, C.E.O.
Dr. David R.S. Thomson
E.V.P., Exploration
Telephone: 56-2-264-2295
Website: www.sagc.com

 

NOT TO BE DISTRIBUTED OR DISSEMINATED IN THE U.S.


FOR IMMEDIATE RELEASE – August 13, 2008
South American Gold and Copper Company Limited Announces First Production at Pimenton, Assay Results of the Lucho Vein and a Private Placement Financing

Toronto, Ontario, Canada - South American Gold and Copper Company Limited (“SAGC” or the “Company”) (TSX-SAG) announced today that Pimenton has made its first shipment of 2,000 kilograms of Knelson gold concentrates and 15 tons of copper/gold concentrates to the Codelco smelter at Ventanas, Chile. This first batch of Knelson gold concentrates and copper/gold concentrates was from development ore taken from the Esperanza adit. Assay results will be available when Alfred H. Knight, an internationally recognized laboratory and our representative at the Codelco smelter, completes its assays of the Knelson gold concentrates and copper/gold concentrates.
The plant at Pimenton is in the commissioning period and therefore production of Knelson concentrates and the copper gold concentrates will be applied to development costs. Commercial production will be declared when the mine reaches production levels of 50% of its planned production rate of 200 tons per day. At 100 tons per day, annual production of gold will be approximately 14,375 ounces and 33 tons of copper at a projected total cash cost per ounce (including smelter costs, exploration and development costs, plant costs and administration costs but excluding depreciation and amortization costs) of approximately US $540 based on current costs.
The Company also announced that it has intercepted the three known veins on the Esperanza adit at Pimenton, the Michelle, the Leyton and the Lucho. Michelle is 503 meters into the adit, Leyton is 579 meters into the adit and Lucho is 635 meters into the adit. In addition at least three other gold/copper veins have been intercepted in the Esperanza adit on which further exploration work will be conducted.
Assay results of channel samples taken every two meters from Lucho Sur and Lucho Norte are shown below:

 

LUCHO SUR
Certificate of Analysis 
Prepared by the Assay Laboratory 
at Pimenton 
gr/ton
%
gr/ton
Channel
TICKET
Au gr/ton
CuT %
Ag gr/ton 
Width
LUCHO
Au
Cu
Ag
Width
1
13091A
2.54
0.10
6.9
0.30
Sur
7.29
0.52
12.19
0.70
1
13092 B
38.9
3.18
50.2
0.10
Sur
1
13093 C 
1.51
0.06
4.8
0.30
Sur
2
13094 A
3.60
0.08
6.7
0.50
Sur
18.76
0.81
25.13
1.20
2
13095 B
66.8
4.50
114.5
0.20
Sur
2
13096 C
14.7
0.07
7.8
0.50
Sur
3
13097 A
22.7
0.45
16.7
0.40
Sur
22.64
0.69
23.84
0.80
3
13098 B 
81.3
3.40
82.2
0.10
Sur
3
13099 C
3.00
0.10
13.9
0.30
Sur
4
13100 A
17.5
1.34
38.2
0.30
Sur
26.76
1.13
28.69
1.00
4
13101 B
85.9
3.50
66.9
0.20
Sur
4
13102 C
8.65
0.06
7.7
0.50
Sur
5
13164
8.00
0.04
34.0
1.00
Sur
18.89
0.06
22.32
1.90
5
13165
85.00
0.17
18.0
0.30
Sur
5
13166
4.0
0.03
5.0
0.60
Sur
6
13167
4.00
0.76
14.0
0.50
Sur
9.43
0.41
18.00
1.75
6
13168
34.00
1.25
46.0
0.25
Sur
6
13169
6.0
0.03
13.0
1.00
Sur
                                    Average Over 12 Meters of Strike Length   =
16.99
0.52
21.81
1.23
LUCHO NORTE
gr/ton
%
gr/ton
Channel
TICKET #
Au gr/ton
CuT %
Ag gr/ton 
Width
LUCHO
Au
Cu
Ag
Width
1
13103 A
7.18
0.40
7.7
0.30
Norte
33.91
2.13
47.05
1.05
1
13104 B
94.6
5.92
127.8
0.35
Norte
1
13105 C
0.86
0.11
5.9
0.40
Norte
2
13106 A 
5.30
0.13
13.8
0.30
Norte
23.29
2.04
31.95
0.85
2
13107 B
71.9
6.66
88.6
0.25
Norte
2
13108 C
0.78
0.09
2.9
0.30
Norte
3
13109 A
14.8
0.24
9.9
0.20
Norte
65.91
2.14
29.34
1.10
3
13110 B
61.4
8.81
68.5
0.20
Norte
3
13111 C
81.8
0.78
23.7
0.70
Norte
4
13170
2.0
0.06
9.0
0.40
Norte
30.91
2.04
50.50
1.60
4
13171
105.0
9.01
206.0
0.35
Norte
4
13172
14.0
0.10
6.0
0.85
Norte
5
13173
4.00
0.09
4.0
0.35
Norte
59.65
1.10
17.05
1.00
5
13174
193.0
3.54
51.0
0.30
Norte
5
13175
1.0
0.03
1.0
0.35
Norte
                                     Average Over 10 Meters of Strike Length  =
42.32
1.91
36.91
0.93

 

These assay results are by fire assay conducted by the Company’s own assay laboratory at Pimenton. This news release relating to the assay results taken from Lucho Sur and Lucho Norte has been reviewed and approved by William Hill, P. Eng., who is a Director of the Company and a qualified person under Canadian Instrument 43-101.
Assay results of the Michelle and Leyton veins are currently in process and will be made available when completed.
The Company also announced that it has filed with the Toronto Stock Exchange a non-brokered private placement financing of up to 42,000,000 Units at Cdn $0.05 per unit or up to Cdn $2,100,000 on a best efforts basis. Each Unit will consist of one common share and one half purchase warrant. Each whole warrant will be exercisable into one common share at Cdn $0.07 for a period of 24 months from the date of closing. The proceeds of the financing will be used for production expansion and to cover a working capital shortfall caused by delays in the receipt of certain plant equipment which did not enable the plant to start full operations until mid July. In the meantime, mining development operations at Pimenton continued. The delay in starting plant operations has caused a working capital shortfall of approximately $1,600,000.
Three Directors, two of whom are also officers of the Company, have subscribed for Cdn $1,100,000 (22,000,000 units) and to date friends of the Company have subscribed for an additional Cdn $613,320 (12,266,400 units) of this Cdn $2,100,000 private placement financing which is subject to the Toronto Stock Exchange’s final approval.
South American Gold and Copper Company Limited is a minerals producing, exploration and development company with properties and activities currently focused in Chile.

"Cautionary Statement Regarding Forward-Looking Information. Except for statements of historical fact, all statements and information in this press release, including without limitation, statements and information regarding Pimenton, the Codelco smelter at Ventanas, Chile, the Michelle, the Leyton and the Lucho veins at Pimenton, new projects, forecasted production, future plans, financing requirements, objectives and results constitute forward-looking information within the meaning of applicable Canadian securities legislation, which involve risks, uncertainties and assumptions, many of which are beyond our control. All such forward-looking information is based on certain assumptions and analyses made by us in light of our experience and perception of historical trends, current conditions and expected future developments, as well as other factors we believe are appropriate in the circumstances. Actual results, performance or achievements could differ materially from those expressed in, or implied by, such forward looking information and, accordingly, no assurance can be given that any of the events anticipated by the forward-looking information will transpire or occur, or if any of them do so, what benefits will be derived there from. Except as required by law, South American Gold and Copper Company Limited and its subsidiaries expressly disclaim any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise.

The forward-looking information contained herein is expressly qualified by this cautionary statement."