Toronto,Ontario - May 26, 1998

South American Gold and Copper Company Limited Announces Advisory Role of Citicorp N.A. on its Catedral/Rino Limestone/Cement Project

Toronto, Ontario - South American Gold and Copper Company Limited (TSE symbol SAG), announced today that it has retained Citicorp to assist it in developing and executing a strategy for maximizing the value of its Catedral/Rino Limestone/Cement project, in which it holds a 50.10% interest.

Stephen W. Houghton, President and CEO, stated, "We believe that through the support of Citicorp's New York, London and Santiago offices, we will more effectively reach and communicate to the international and regional cement companies the substantial economic benefits of our Catedral/Rino Limestone/Cement project. Citicorp's industry expertise and commitment to the project will assist us in clarifying to the market the Project's exceptionally low direct and variable operating costs, the significance of the Rino limestone deposit's highly favorable location, its extensive reserves of open pitable cement quality limestone, its access to natural gas and the implication and benefits of utilizing a highly cost effective method of transporting limestone from the limestone deposit to the plant site through a planned slurry pipeline.

"In addition, we believe that Citicorp's industry expertise will assist us in assessing the implications of recent developments in the Chilean cement industry, which we view as favorable to our Project and include the recent announcement that Cemento Melon has acquired the limestone reserves located near Vallenar, Chile, 700 kilometers north of Santiago, on which Soquimich had planned to build a cement clinker manufacturing facility.

"Citicorp has an established track record in the cement industry and maintains relationships with most of the leading cement producers worldwide. We believe that this combination of experience and access will assist us to realize the Project's significant potential value to our shareholders."

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 in Canada and the US, Stephen W. Houghton, President and CEO; William C. O'Donnell, EVP and CFO. Telephone: (212) 983-9300, fax: (212) 983-9314; and visit our website at http://www.sagc.com. For further information in Santiago, Chile, David R. S. Thomson, EVP and Director of Exploration, or Mario Hernandez, EVP, Land Claims Administration. Telephone (56) 2 232-5578.