AR Argonaut Gold Inc

Argonaut Gold Inc. ("Argonaut Gold" or the "Company") (TSX:AR) announced today
that the Company produced 24,123 gold ounces during the 2nd quarter ended June
30, 2012 at its 100% owned El Castillo Mine ("El Castillo") which is located 100
km north of the city of Durango, Mexico and its 100% owned La Colorada Mine ("La
Colorada") which is located 50 kilometers southeast of Hermosillo, Mexico.
Operational progress at El Castillo and La Colorada continue to ramp-up
production. 


SECOND QUARTER 2012 HIGHLIGHTS:

El Castillo



--  Quarterly production of 19,533 gold ounces represents a 10% improvement
    over Q1 2012. 
--  35,220 gold ounces loaded on the pad. 
--  Leach pad 7A west side pad construction completed. 
--  Conveying and stacking system on the east side pad expected to be
    commissioned this month. 
--  Local community support programs implemented to assist with on-going
    drought conditions. 



La Colorada



--  Production of 4,590 gold ounces and 25,796 silver ounces. 
--  10,173 gold ounces and 1,120,716 silver ounces loaded on the pad. 
--  New crusher purchased for production of overliner for pad construction. 
--  Desorption and refinery circuit fully commissioned. 
--  New warehouse for reagent storage completed. 
--  Final permits for mining expansion expected in third quarter. 
--  Approximately half of Phase 1 run of mine material has been reprocessed.
--  New pad construction started on pads 8, 10 and 11. 



Exploration



--  El Castillo sulphide samples obtained for continued metallurgical test
    work, with results expected in September. 
--  More than 35,000 meters of drilling released at La Colorada. 
--  More than 20,000 meters of drilling released at San Antonio. 
--  Drilling continues at La Colorada and San Antonio. 



Financial 



--  Cash balance of $21 million as of June 30, 2012. 
--  Majority of the 2012 capital program completed in the first half. 
--  23,247 ounces of gold sold. 



SECOND QUARTER 2012 El CASTILLO OPERATING RESULTS:

Second quarter operating statistics showed improvement over 2011 second quarter
results. Ore production from the first half of the year is currently at an
annualized rate of approximately 11 million tonnes. On the west side of the
property, construction was completed on cell 7A. 


Third quarter production is expected to improve over the second quarter with the
production of approximately 20-21,000 ounces of gold. Production at El Castillo
is expected to move towards a 20-23,000 ounce production rate in the fourth
quarter of this year. Full year guidance is 75,000-80,000 ounces of gold.




El Castillo Operating Statistics                                            
                                          3 Months Ended June 30            
                                          2012           2011      % Change 
Mining                                                                      
Total tonnes mined                   5,037,401      4,970,835            +1%
Tonnes ore mined                     2,506,756      2,786,349           -10%
Heap Leach Pad                                                              
Direct ore tonnes to pad             1,533,188      1,920,657           -20%
Crushed ore tonnes to pad            1,164,340        860,289           +35%
Production                                                                  
Gold grade (g/t)                          0.41           0.33           +24%
Gold loaded to pad (oz)                 35,220         29,555           +19%
Gold loaded to carbon (oz)              19,533         17,453           +12%
Gold sold (oz)                          17,949         14,331           +25%
(1) "g/t" is grams per tonne                                                
(2) "oz" means ounce                                                        



Richard Rhoades, Chief Operating Officer of Argonaut Gold said: "The 10%
improvement in gold production at El Castillo was a significant milestone at the
mine. Two additional accomplishments for the quarter were the completion of
leach pad 7A and the implementation of a stacking-conveying system that is to be
commissioned later this month. Initially, day shifts will be utilized for
training on the new conveying system, with the goal to implement a 24 hour
conveying operation by Q3. The impact of adding the conveying system to the
operation should be evident in the fourth quarter production numbers as we
anticipate an increase in the material moved."


SECOND QUARTER 2012 LA COLORADA OPERATING RESULTS:

The second quarter operating statistics showed production from the reprocessing
of existing run of mine leach pad material at La Colorada. To date,
approximately half of the Phase I run of mine material to be reprocessed has
been recrushed and stacked for leaching. 


Construction has begun on pads 8, 10 & 11 and one half of the capacity is
expected to be completed in the third quarter. In addition, during the third
quarter the crusher will be down for approximately one month as it is relocated
to a more permanent location, near the new pads currently under construction. 


The next steps at La Colorada will involve reprocessing loose material in the
pit, followed by full scale mining by Q1 of next year. Due to the crusher
relocation, the third quarter production expectations are approximately 3,000
ounces of gold, while 2012 guidance at La Colorada remains at 13-17,000 ounces. 


The desorption and recovery circuit has been commissioned, and carbon from El
Castillo and La Colorada is being processed.




La Colorada Operating                                                       
 Statistics                                                                 
                                          3 Months Ended June 30            
                                       Q2 2012        Q1 2012      % Change 
Mining                                                                      
Total tonnes moved                     840,241        678,310           +24%
Ore tonnes moved                       805,611        678,310           +19%
Heap Leach Pad                                                              
Crushed ore tonnes to pad              743,533        680,396            +9%
Production                                                                  
Gold grade (g/t)                          0.43           0.41            +5%
Gold loaded to pad (oz)                 10,173          8,886           +14%
Gold loaded to carbon (oz)               4,590          3,085           +49%
Silver loaded to carbon (oz)            25,796         17,182           +50%
Gold sold (oz)                           5,298              0            NA 
(1) "g/t" is grams per tonne                                                
(2) "oz" means ounce                                                        



Discussing the Company's recent completion of the ADR plant at the La Colorada
site Mr. Pete Dougherty, President and CEO said "the Company is now processing
carbon from El Castillo and La Colorada on site. This important accomplishment
has reduced the sales cycle time from approximately 6 weeks to 1 week. The long
term goal is for the ADR circuit to handle the stripping and refining for the
Company's primary Mexican operations. We are pleased with the improvement in our
sales time as a result of implementing the ADR plant. 


I'm proud of the team's accomplishments so far this year. By continually
improving our processes in our daily operations we look to continue production
growth, finishing the year strong." 


About Argonaut Gold 

Argonaut Gold is a Canadian gold company engaged in exploration, mine
development and production activities. Its primary assets are the
production-stage El Castillo Mine in the State of Durango, Mexico, the
production stage La Colorada Mine in the State of Sonora, Mexico, the advanced
exploration stage San Antonio project in the State of Baja California Sur,
Mexico, and several exploration stage projects, all of which are located in
Mexico.


Creating Value Beyond Gold 

Cautionary Note Regarding Forward-looking Statements 

This press release contains certain "forward-looking statements" and
"forward-looking information" under applicable Canadian securities laws
concerning the proposed transaction and the business, operations and financial
performance and condition of Argonaut Gold Inc. ("Argonaut"). Forward-looking
statements and forward-looking information include, but are not limited to,
statements with respect to estimated production and mine life of the various
mineral projects of Argonaut; synergies and financial impact of completed
acquisitions; the benefits of the development potential of the properties of
Argonaut; the future price of gold, copper, and silver; the estimation of
mineral reserves and resources; the realization of mineral reserve estimates;
the timing and amount of estimated future production; costs of production;
success of exploration activities; and currency exchange rate fluctuations.
Except for statements of historical fact relating to Argonaut, certain
information contained herein constitutes forward-looking statements.
Forward-looking statements are frequently characterized by words such as "plan,"
"expect," "project," "intend," "believe," "anticipate", "estimate" and other
similar words, or statements that certain events or conditions "may" or "will"
occur. Forward-looking statements are based on the opinions and estimates of
management at the date the statements are made, and are based on a number of
assumptions and subject to a variety of risks and uncertainties and other
factors that could cause actual events or results to differ materially from
those projected in the forward-looking statements. Many of these assumptions are
based on factors and events that are not within the control of Argonaut and
there is no assurance they will prove to be correct.


Factors that could cause actual results to vary materially from results
anticipated by such forward-looking statements include changes in market
conditions, variations in ore grade or recovery rates, risks relating to
international operations, fluctuating metal prices and currency exchange rates,
changes in project parameters, the possibility of project cost overruns or
unanticipated costs and expenses, labour disputes and other risks of the mining
industry, failure of plant, equipment or processes to operate as anticipated.
Although Argonaut has attempted to identify important factors that could cause
actual actions, events or results to differ materially from those described in
forward-looking statements, there may be other factors that cause actions,
events or results not to be anticipated, estimated or intended. There can be no
assurance that forward-looking statements will prove to be accurate, as actual
results and future events could differ materially from those anticipated in such
statements. Argonaut undertakes no obligation to update forward-looking
statements if circumstances or management's estimates or opinions should change
except as required by applicable securities laws. The reader is cautioned not to
place undue reliance on forward-looking statements. Statements concerning
mineral reserve and resource estimates may also be deemed to constitute
forward-looking statements to the extent they involve estimates of the
mineralization that will be encountered if the property is developed.
Comparative market information is as of a date prior to the date of this
document.


Qualified Person 

Preparation of this release was supervised by Thomas Burkhart, Argonaut Gold's
Vice President of Exploration, and a Qualified Person under NI 43-101. For
additional information on El Castillo please refer to the "NI 43-101 Technical
Report on Resources and Reserves, Argonaut Gold Inc., El Castillo Mine, Durango
State, Mexico" dated Nov. 6, 2010 and further information on La Colorada please
refer to the "NI 43-101 Preliminary Economic Assessment La Colorada Project,
Sonora, Mexico" dated December 30, 2011, both of which and available at Argonaut
Gold's website and profile on www.sedar.com.

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