Augusta Files Q1
Financials – Negotiates Sale of Nevada Properties
VANCOUVER,
BC, May 1, 2007 - Augusta Resource
Corporation (TSX/AMEX: AZC; FRANKFURT: A5R) (“Augusta” or the “Company”)
reports
the Company filed its first
quarter financial statements today.
During the first quarter, the Company was pleased to deliver the 2007
Rosemont Deposit Mineral Resource Estimate, which included 5.7 billion pounds
(“lbs”) of copper (“Cu”) and 157 million ounces (“oz”) of molybdenum (“Mo”) in
measured and indicated resources, and 1.5 billion lbs of Cu and 23 million oz of
Mo in inferred resources. The
estimate also included a new silver (“Ag”) resource for the deposit, which
quantified approximately 66.5 million ounces (“oz”) of Ag in measured and
indicated resources and 9.3 million oz of Ag in inferred resources. On a copper equivalence basis, the
measured and indicated resource contains 8.4 billion lbs of Cu equivalent, and
1.9 billion lbs of Cu equivalent in inferred resources*. The new NI 43-101 compliant technical
report on the Rosemont Property was filed on SEDAR at www.sedar.com on April 26,
2007.
The
Company also reports it has entered into a Letter of Intent (“LOI”) with Ivana
Ventures Inc. (“Ivana”) respecting Augusta’s proposed sale of the Company’s
interest in the Mt. Hamilton and Shell properties, both of which are located in
White Pine County, Nevada.
The
LOI provides for the sale of 100% of the shares of DHI Minerals Ltd., which owns
100% of the shares of DHI Minerals (U.S.) Ltd. (the “Subsidiaries”) which in
turn holds a 100% interest in each of the Mount Hamilton and Shell
properties. Each property is
subject to a sliding scale net smelter royalty and, in the case of the Mount
Hamilton property, minimum advance royalty payments of US$100,000 per year until
November 9, 2010 when the minimum royalty payments increase to US$300,000 per
year. In the case of the
Shell property, annual advance royalty payments commencing at US$80,000 on the
first anniversary, increasing by US$20,000 per year until production
commences.
The
consideration for the sale will be US$6.5 million in cash, and warrants
exercisable to purchase up to 3,000,000 shares of Ivana for eighteen months
after closing at the price of $0.50 per share. The cash portion of the purchase price
will be payable in installments over five years, with US$1,500,000 payable on
closing and an additional US$1,000,000 payable each 12 months thereafter. The shares of the Subsidiaries will be
pledged to the Company as its sole recourse for non-payment of any portion of
the purchase price.
The
proposed sale is subject to a 30 day due diligence period in favour of Ivana,
execution of a formal agreement acceptable to both parties and acceptance of
such agreement for filing by the TSX Venture Exchange.
ABOUT AUGUSTA RESOURCE
CORPORATION - Augusta is a mineral exploration and
development company responsibly advancing the
Rosemont copper project in Southern Arizona. The Company’s Rosemont property is
located in Pima County, approximately 50 kilometers southeast of Tucson, Arizona, and contains a potentially world class open-pit
copper/molybdenum/silver (“Cu/Mo/Ag”) deposit. Augusta has a solid asset
base, proven management team, and is committed to becoming a mid-tier
copper producer within five years. The company is traded on the American Stock
Exchange and the Toronto Stock Exchange under the symbol AZC.
*
Copper equivalence is based on prices of $1.25/lb Cu, $18.00/lb Mo and $8.50/oz
Ag, with no applied recovery factors.
For additional
information please visit www.augustaresource.com or contact:
Gil Clausen,
President and CEO Marlo
Hamer-Jackson, Investor Relations Manager
Phone:
303-300-0136 Phone: 604-687-1717
Fax:
303-300-0135
Fax: 604-687-1715
gclausen@augustaresource.com
mhamer-jackson@augustaresource.com
ON
BEHALF OF THE BOARD OF DIRECTORS
“Gil
Clausen”
_________________________
Gil
Clausen
President and CEO
CAUTIONARY STATEMENT
REGARDING FORWARD LOOKING INFORMATION
Certain of
the statements made and information contained herein and in the documents
incorporated by reference may contain forward-looking statements or information
within the meaning of the United States Private Securities Litigation
Reform Act of 1995 and forward looking statements or information within the
meaning of the Securities Act (Ontario). Forward- looking statements or information include statements regarding the expectations and beliefs of management. Forward looking statements or information include, but are not
limited to, statements or information with respect to known or unknown risks,
uncertainties and other factors which may cause the actual results, performance
or achievements of the Company, or industry results, to be materially different
from any future results, performance or achievements expressed or implied by
such forward-looking statements or information. Forward-looking statements or
information are subject to a variety of risks and uncertainties which could
cause actual events or results to differ from those reflected in the
forward-looking statements or information, including, without limitation, risks
and uncertainties relating to the Company’s plans at its Rosemont Property and
other mineral properties, the interpretation of drill results and the estimation
of mineral resources and reserves, the geology, grade and continuity of mineral
deposits, the possibility that future exploration, development or mining results
will not be consistent with the Company’s expectations, metal recoveries,
accidents, equipment breakdowns, title matters, labor disputes or other
unanticipated difficulties with or interruptions in production and operations,
the potential for delays in exploration or development activities or the completion of feasibility studies, the inherent uncertainty of production and
cost estimates and the potential for unexpected costs and expenses, commodity
price fluctuations, currency fluctuations, failure to obtain adequate financing
on a timely basis, the effect of hedging activities, including margin limits and
margin calls, regulatory restrictions, including environmental regulatory
restrictions and liability, the speculative nature of mineral exploration,
dilution, competition, loss of key employees, and other risks and uncertainties,
including those described under “Risk Factors Relating to the Company’s
Business” in the Company’s Annual Information Form dated March 1, 2007. Should one or more of these risks and
uncertainties materialize, or should underlying assumptions prove incorrect,
actual results may vary materially from those described in forward-looking
statements. Accordingly, readers
are advised not to place undue reliance on forward-looking statements or information. We do not expect to
update forward-looking statements or information continually as conditions
change, and you are referred to the full discussion of the Company’s business
contained in the Company’s reports filed with the securities regulatory
authorities in Canada and the United States.