Toronto,Ontario - February 17, 2000

FOR IMMEDIATE RELEASE

South American Gold and Copper Company Limited Announces Completion of a Major Restructuring of its Balance Sheet

Toronto, Ontario, Canada - South American Gold and Copper Company Limited ("SAGC")(TSE Symbol SAG) is pleased to announce a significant improvement in its financial condition as a result of a substantial restructuring of its balance sheet.

The Company has purchased its Series A Cdn. $1,300,000 Debenture plus accrued interest of Cdn. $248,529 which had been in default since January 1999. The purchase was made at a substantial discount and will be recognized as non-cash income by the Company in the amount of approximately US $1,000,000 on its financial statements for its first fiscal quarter ending December 31, 1999.

The Company has completed negotiations with the holder of its Series B Cdn, $2,700,000 Debenture which had been in default since July 1998. The Series B Debenture has been exchanged for a new Convertible Debenture in the amount of Cdn. $2,700,000 with a conversion price of Cdn, $0.20 per share, subject to certain dilution provisions and adjustable upwards based on the future price of gold. The Company also issued to the Series B Debenture holder a Convertible Debenture in the amount of Cdn. $664,000 exercisable at. $0.075 per share in payment of past due interest payable through December 31, 1999. Both Debentures have a maturity date of September 30, 2005. The Convertible Debentures will have a two-year grace period on the payment of interest through December 31, 2001. Thereafter, interest rate will be 5% simple interest per annum payable in either cash, common shares or by issuance of a new convertible debenture for interest payable during a quarter in which the Company elects not to pay interest in cash.

The Company has also extended the maturity date on its US $2,000,000 Pimenton Notes to December 31, 2005. Under the terms of the extension agreement, the Note holders will be granted common stock purchase warrants of SAGC for the purchase of up to a total of 6,000,000 common shares of SAGC at an exercise price of Cdn. $0.51 per share exercisable either by way of cash exercise of the warrant or by tendering all or a portion of the Notes in exercise of all or a portion of the warrant. The Note holders have also agreed to a two-year grace period on payment of interest on the Notes. When due, interest will be paid at the rate of 5% per annum but only at the end of any 90 day consecutive period during which gold trades above US $320.00 per ounce on the London Metals Exchange.

The Company also announced that members of its Board of Directors have recently purchased by way of a private placement 2,920,000 common shares of SAGC at Cdn. $0.075 per share in addition to 18,000,000 shares which were purchased in April 1999, as a part of a previously announced 30,000,000 share private placement, as a vote of their confidence in the Company and its plans for the future.

Stephen W. Houghton, President and CEO, stated "The Company has received regulatory and shareholder approval for these transactions. The combination of the Company’s balance sheet restructuring and the recently announced favorable conclusion of arbitration proceedings filed against its 100% owned Chilean subsidiary substantially improves SAGC’s financial condition. The Company is now in a position to substantially advance financing plans for its Cal Norte 150 ton per day lime manufacturing project and for its Catedral project."

Mr. Houghton further stated "The Company is proceeding with development plans for up to a 600 ton per day lime manufacturing facility at its high grade limestone deposit at Catedral, located 120 road kilometers southeast of Santiago. Market studies by the Company indicate a definitive opportunity and need for this facility. The plant will be highly market competitive due to its favorable location and access to natural gas."

Dr. David R. S. Thomson, EVP and Director of Exploration, stated, "Exploration activities on Catedral have identified high grade limestone resources at Catedral at over 50,000,000 tons grading 90% to 92% CaCO3."

Mr. Houghton continued, "Combined annual revenues from the sale of metallurgical grade lime (CaO) from the Cal Norte and Catedral lime manufacturing projects, if successfully completed, could exceed US $21,000,000 with estimated annual operating profits before depreciation, interest and taxes of US $8,000,000 to US $9,000,000. A significant part of the cash flow generated from these projects will be used to advance our gold and copper exploration and development activities."

SAGC is a mineral exploration company with gold and industrial mineral projects and properties in Chile. Its common shares are listed on the Toronto Stock Exchange under the symbol SAG.

For further information, Stephen W. Houghton, President and CEO; William C. O’Donnell, EVP and CFO. Telephone: (212) 751-0083; fax: (212) 751-0319; and visit our website at http://www.sagc.com.