Augusta Reports On Progress At Rosemont

VANCOUVER, BC - Augusta Resource Corporation reported that it has received significant strategic interest regarding the Company's 100% owned Rosemont Copper/Molybdenum project in southern Arizona. The Company has retained TD Securities Inc. as its financial advisor to assist in assessing the various alternatives that Augusta has been developing including: minority joint venture ("JV") interests; concentrate off-take financing; mergers and acquisitions; and any potential sale of the Company.
JV negotiations are well advanced and are awaiting the completion of the Company's updated Bankable Feasibility Study (the "Updated BFS") to set the final valuation. The Updated BFS is expected to be complete between December 15, 2008 and January 15, 2009.
The Company also announced that a silver off-take financing arrangement with Silver Wheaton Corp. is to be re-structured upon completion of the Updated BFS. A new deal structure will enhance the potential of introducing a JV partner to the transaction. The Company expects that, if successful in these transactions, the need for further equity offerings to finance ongoing development of Rosemont should not be necessary.
The Company also expects that an increase in mining reserves at Rosemont will be forthcoming as a result of the latest resource increase announced October 23, 2008. An updated mine design is in progress.
The Rosemont project has an estimated US$797 million capital cost and is currently projected to be a low cost copper producer. Annual production is expected to be about 220-240M lbs of copper, 5-6M lbs molybdenum and 3M ounces of silver. This production would rank Rosemont within the top four largest copper producing mines in the United States at about 10% of United States domestic copper production. The current Bankable Feasibility Study (the "2007 BFS") completed in August 2007 projects an NPV of US$1.1 billion at a 5% discount rate using a US$1.50 per lb copper price long term. Cash costs are projected to be US$0.90 per lb before by-product credits and US$0.50 after by-product credits. These costs would rank Rosemont well below the current median cash cost per pound of copper produced worldwide.
The Company has procured all critical long lead-time capital equipment under fixed price contracts and projects that the Updated BFS should be very close to the 2007 BFS capital cost estimate.
With a clear path and timing for final project permitting, and an outstanding developed location, Augusta continues to establish Rosemont as an outstanding copper development project.