Toronto,Ontario - July 2, 1997

South American Gold and Copper Company Reports Exploration Progress on its Antena Project

Toronto, Ontario, - South American Gold and Copper Company Limited (TSE, symbol "SAG") announced today that the results of its geophysical and geochemical work at its Antena Prospect has identified the presence of a gold mineralized zone, within an area measuring approximately 200 metres by 300 metres.

Intrusive float with disseminated limonite occurs within the identified area. The float assays from 0.2 to 1.4 grams of gold per tonne. Three fist-sized samples carrying quartz and limonite vein material returned assays of 0.55; 8.6 and 10.4 grams of gold per tonne. A systematic hand panning program was recently initiated and is proving to be a highly useful exploration tool. Gold is being recovered from stream gullies that are active during the rainy season which occurs on the Coast of the Central Region of Chile at this time of year. Gold has also been recovered by panning soils. The successful gold panning program is being used as an immediate follow-up exploration tool to help delineate target zones for road trenching and drilling. The current road trenching program is directed to one of these targets. The drill program on this mineralized target is expected to commence within a month's time, weather permitting.

The Company has purchased an Atlas Copco Mustang A-32 drill and XRH-385 compressor which will be used to conduct a percussion drilling program on the targeted area of potential mineralization. The use of its own drill rig and crew is expected to enable the Company to obtain faster drilling results at substantially reduced costs.

Dr. David Thomson, EVP and Director of Exploration, stated that, based on geological, geochemical and geophysical information to date, there is reason to believe that several centers of gold mineralization will be found within the 80 square kilometre area of Antena presently being explored.

SAGC is a mineral exploration company with extensive gold properties in Chile and Peru. 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 (odonnell@sagc.com). Telephone: (212) 983-9300, fax: (212) 983-9314.