Argonaut Gold Announces Q1 Gold Production of 21,084 Ounces

TORONTO, ONTARIO–(April 17, 2012) – Argonaut Gold Inc. (“Argonaut Gold” or the “Company”) (TSX:AR) announced today that the Company produced 21,084 gold ounces during the 1^st quarter of 2012 (ended March 31, 2012) at its 100% owned El Castillo Mine (“El Castillo” which is located 100 km north of the city of Durango, Mexico) and 100% owned La Colorada Mine (“La Colorada” which is located 50 kilometers southeast of Hermosillo, Mexico).

FIRST QUARTER 2012 HIGHLIGHTS:

El Castillo Operations

• Contractor mining fleet increased to 18 trucks (100 tonne capacity)
• Achieved approximately 2.0 million total tonnes mined per month.
• Leach pad 7A west side pad construction initiated.
• 35,283 gold ounces loaded on the pad.
• Gold production of 17,799 ounces.

La Colorada Operations

• Production initiated at La Colorada.
• 8,886 gold ounces loaded on the pad; 857,795 silver ounces loaded on the pad.
• Gold production loaded on carbon of 3,085 gold ounces and 17,182 silver ounces.

FIRST QUARTER 2012 El CASTILLO OPERATING RESULTS:

The first quarter operating statistics showed improvement over the Q1 2011. Ore production has increased to an annualized rate of more than 12 million tonnes. The contractor has increased the size of the mining fleet, now operating 18 trucks with 100 tonne capacity. With completion of contruction on cell 5, the east side pad capacity is now approximately 30 million tonnes. In Q1, construction began at cell 7A on the west side pads. Guidance for 2012 production is 75-80,000 ounces with a $625-$650 cash cost.

During Q1 of 2012, 14,498 ounces of gold were sold. At March 31, 2012, inventory at the third party desorption plant was approximately 5,500 ounces of gold.

Pete Dougherty, President and CEO of Argonaut Gold noted: “Gold production for the first quarter was in line with our 2012 guidance; cash cost guidance is anticipated to be $625-$650 per ounce at both operations. Non-commercial production of 3,085 gold ounces and 17,182 silver ounces at La Colorada began this quarter. While reprocessing material at La Colorada is anticipated to provide limited production during 2012, this cash flow will be used for continued infrastructure construction at the project. The Company is now producing from two gold mining operations, diversifying the Company’s production portfolio and providing cash for capital expenditures and funding exploration. The capital expansions planned at El Castillo and La Colorada set the stage for production growth in 2012 and beyond.”

About Argonaut Gold

Argonaut 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 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, 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 presentation.

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 available at Argonaut Gold’s website and profile on www.sedar.com.

Contact Information
Argonaut Gold Inc.
Nichole Cowles
Investor Relations Manager
(775) 284-4422 x 101 
nichole.cowles@argonautgoldinc.com
www.argonautgoldinc.com