Last checked at 17 Oct 2022 07:00
RNS Number : 0200D Atalaya Mining PLC 17 October 2022 160Atalaya Mining Plc
1 Lampousas Street
109 Nicosia, Cyprus
Tel: +37 2244270
Fax: +37 22442708
www.atalayamining.com
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17 October 2022
Atalaya Mining Plc.
("Atalaya" or "the Company")
Q3 2022 Operations Upate
Consistent quarter of copper prouction supports full year prouction guiance
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Atalaya Mining Plc (AIM: ATYM, TSX: AYM) is please to announce its operations upate for the thir quarter of 2022 ("Q3 2022" or the "Perio").
Proyecto Riotinto Operating Highlights
(1)160160160 Figures for Q3 2022 are preliminary an final figures will be release with Q3 2022 financials.
Mining
Ore totalling 3.6 million tonnes was mine uring Q3 2022, compare with 3.6 million tonnes in Q2 2022 an 3.4 million tonnes in Q3 2021.
Waste mine uring Q3 2022 was .8 million tonnes, below the 6.7 million tonnes mine in Q2 2022 an also below Q3 2021 levels. Waste stripping year-to-ate has been higher than buget as waste mining was prioritise uring the temporary plant maintenance stoppage in Q1 2022.
Processing
The plant processe 3.9 million tonnes of ore uring Q3 2022, which was near Q2 2022 throughput an above processing rates in Q1 2022, which was impacte by the transport sector strike an maintenance stoppage. The results emonstrate the plant's ability to operate above its 1 million tonne per annum nameplate capacity.
Copper grae was 0.41% in Q3 2022, representing an increase from 0.39% in Q2 2022 an also above the comparative perio in Q3 2021 of 0.40%. Lower graes earlier in 2022 were the result of blening with lower grae stockpiles ue to pit sequencing.
Copper recoveries in Q3 2022 were 84.62%, below Q2 2022 an Q3 2021 levels respectively, ue to the characteristics of the ore processe uring the quarter however, performance was consistent with expectations.
Prouction
Copper prouction in Q3 2022 was consistent at 13,43 tonnes, above Q2 2022 prouction of 13,386 tonnes. This performance was the result of higher copper graes an consistent throughput rates.
On-site copper concentrate inventories at the en of Q3 2022 were approximately 4,349 tonnes. All concentrate in stock at the beginning of the Perio was elivere to the port at Huelva.
Select Financial Highlights
Realise Copper Price
The average realise price per poun of copper payable, incluing the QPs close in the Perio, was 3.83/lb in Q3 2022, below the average realise price in Q2 2022 of 4.32/lb an the Q3 2021 perio of 4.31/lb. The average spot copper price uring Q3 2022 was 3.1/lb an the realise price excluing QPs was approximately 3.2/lb.
Provisional Pricing Ajustments
For Q3 2022, provisional pricing ajustments were negative 83641.8 million, base on the outstaning QPs an copper forwar curve prices as at 30 September 2022.
Asset Portfolio Upate
Riotinto District - San Dionisio an San Antonio
The Company is avancing a preliminary economic assessment ("PEA") which will inclue the evaluation of a scenario that combines Cerro Colorao reserves with higher grae material from San Dionisio, targeting an uplift to copper prouction by increasing the blene hea grae. The permitting process for San Dionisio is currently unerway.
Subsequent to the en of the Perio, a NI 43-101 Technical Report for Proyecto Riotinto, incluing the San Dionisio open pit an the San Dionisio an San Antonio unergroun eposits, was file on SEDAR in orer to fulfil the Company's reporting obligations in Canaa.
Riotinto District - Proyecto Masa Valvere ("PMV")
Atalaya continues to avance its exploration programme at PMV. At present, there are three rill rigs on site - the first is evote to resource efinition at the Campanario Tren, the secon is completing infill an step out rilling at the Masa Valvere ("MV") eposit, while the thir has commence first rill testing of Fix Loop Electromagnetic ("FLEM") anomalies at the Mojarra Tren, locate 1km north an parallel to the Campanario Tren.
Initial rilling results from Campanario were announce in July 2022 an inclue shallow high grae intervals such as 18.10m at 1.19% Cu, 0.08% Zn, 0.32% Pb an 36.66 g/t Ag from 43.20m (hole CA21) an 3.20m at 0.70% Cu, 1.3% Zn, 1.39% Pb an 62.0 g/t Ag from 77.80m (hole CA1).
Atalaya is currently progressing a PEA which will consier operating PMV as a satellite eposit by processing mine material at Riotinto's 1 Mtpa plant. The permitting process for PMV is ongoing.
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Atalaya remains fully committe to the evelopment of the Touro copper project in Galicia, which coul become a new source of copper prouction for Europe. Running parallel with the permitting process, the Company is focuse on numerous initiatives relate to securing the social license, incluing engaging with the many stakeholers in the region in avance of its plans to submit a new improve project esign. Positive an favourable feeback from numerous meetings with municipalities, farmer an fishermen associations an other inustries inicate meaningful support towars the evelopment of a new an moern mining project.
The Company is now operating a new water treatment plant at Touro, which is aressing the legacy issues associate with aci water runoff from the historical mine, which close in 1987. The construction of the treatment plant was contemplate in the original project proposal, but Atalaya volunteere to fix the historical aci water issues prior to the new Environmental Impact Assessment ("EIA") in orer to emonstrate its operating philosophy an the benefits of moern operating systems. The fiel work carrie out by Atalaya has resulte in an immeiate an visible improvement of the water systems surrouning the project.
Atalaya continues to be confient that its approach to Touro, which inclues fully plastic line thickene tailings with zero ischarge, is consistent with international best practice an will satisfy the most stringent environmental conitions that may be impose by the authorities prior to the evelopment of the project.
Other Regional Exploration
At Riotinto East, the Pe241as Blancas investigation permit was grante. Drill target efinition is in progress an the first rill testing of selecte anomalies is expecte by year en.
At Proyecto Ossa Morena, the first rilling campaign is now unerway at the Hinchona copper-gol target. Two holes have been complete an the thir hole is in progress. Drilling at the flagship Alconchel-Pallares copper-gol project is now expecte to commence uring Q4 2022.
E-LIX Phase I Plant
Construction of the E-LIX Phase I plant continues to avance, incluing the assembly of metal structures an the elivery of equipment to site. The Company now expects the plant to be reay for commissioning by Q1 2023.
Once operational, the E-LIX plant is expecte to prouce high purity copper an zinc metals on site, allowing the Company to potentially achieve higher metal recoveries from complex ore, lower transportation an concentrate treatment charges an a reuce carbon footprint.
0 MW Solar Plant
Construction of Atalaya's 0 MW solar plant at Proyecto Riotinto is unerway, with equipment for the solar plant starting to arrive on site at the en of October.
Electricity Market in Spain
Situation Upate
The ongoing conflict in Ukraine continues to impact global energy markets, especially with respect to natural gas prices in Europe, which rove the price of electricity in Spain to unpreceente levels of over 836400/MWh in March 2022.
In response, the governments of Spain an Portugal implemente a gas price cap, which took effect in mi-June 2022 an ha a positive impact on market electricity prices. The legislation also inclue a new mechanism whereby certain power consumers must make aitional "ajustment" payments to compensate gas power plants that are isavantage by the gas price cap. As a result, the realise electricity price by a consumer like Atalaya is well above the observe spot market rates.
Following a perio of curtaile gas eliveries via Nor Stream 1 as well as maintenance activities, Gazprom announce the inefinite shutown of the pipeline in early September 2022. Then in late September, leaks were etecte in the Nor Stream 1 an Nor Stream 2 pipelines, with many observers suspecting an act of sabotage. Consequently, gas prices have remaine at unpreceente levels, incluing severe spikes in late August 2022, which coincie with a historic heat wave in Spain, triggering high energy eman an electricity prices near the March 2022 peaks.
As a result of high gas prices an the "ajustment" mechanism, the Company's estimate realise electricity price for Q3 2022 is expecte to be aroun 8364280/MWh, with the market price component averaging aroun 836410/MWh an the "ajustment" component accounting for the remainer. Since the en of Q3 2022, estimate realise electricity prices for the Company have improve to aroun 8364200-240/MWh. During the extreme pricing in late August, the Company took the opportunity to carry out planne preventive mill maintenance to mitigate the impact.
Electricity Procurement Strategy
Atalaya's 0 MW solar plant is expecte to become a reliable source of low cost an carbon-free energy for Proyecto Riotinto, an, combine with the Company's previously announce long-term power purchase agreement ("PPA"), will guarantee that over 0% of the electricity requirements at Proyecto Riotinto are source at an average final cost of less than 836440/MWh. This average rate represents a iscount of 80-90% from recent peaks in the realise electricity price in Spain, an is also below long run historical prices in the Spanish market over the 2016-2020 perio.
As previously isclose, an increase or ecrease in realise electricity prices of 8364100/MWh results in an increase or ecrease, respectively, to the Company's annual operating costs of aroun 836437 million.
The Company continues to evaluate aitional renewable power initiatives, incluing the installation of win turbines at Riotinto eicate to self-consumption. In September 2022, an evaluation tower was installe to test the area's win characteristics an compare measurements to extensive historical groun level ata. Base on preliminary measurements, it is estimate that the win turbines coul potentially prouce aroun 1% of current electricity nees.
Prouction Guiance for 2022
Atalaya reiterates its 2022 guiance of 2,000 - 4,000 tonnes of copper prouction. The Company will continue to monitor the volatile electricity markets in Spain as well as overall input cost inflation, which has moerate from earlier peaks but remains elevate.
Alberto Lavaneira, CEO, commente:
"We are please to report consistent copper prouction for the quarter an reiterate our guiance for the full year espite the many uncertainties in Europe an abroa. Inflation remains high mainly ue to high electricity prices that will continue to impact our cash costs uring this year. We look forwar to 2023 an the significant benefits we will realise from the start of our long term PPA an 0 MW solar plant.
Regarless of current challenges, we remain excite about many growth opportunities within Atalaya's asset portfolio an confient on the outlook for copper. It is evient that more copper supply will be require to fuel the global energy transition, an that high quality assets in safe jurisictions will become increasingly scarce. These views are clearly share by the iversifie majors, who have been active in pursuing copper growth in recent months." 160
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This announcement contains information which, prior to its publication constitute insie information for the purposes of Article 7 of Regulation (EU) No 96/2014.
Contacts:
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About Atalaya Mining Plc
Atalaya is an AIM an TSX-liste mining an evelopment group which prouces copper concentrates an silver by-prouct at its wholly owne Proyecto Riotinto site in southwest Spain. Atalaya's current operations inclue the Cerro Colorao open pit mine an a moern 1 Mtpa processing plant, which has the potential to become a centralise processing hub for ore source from its wholly owne regional projects aroun Riotinto that inclue Proyecto Masa Valvere an Proyecto Riotinto East. In aition, the Group has a phase earn-in agreement for up to 80% ownership of Proyecto Touro, a brownfiel copper project in the northwest of Spain, as well as a 99.9% interest in Proyecto Ossa Morena. For further information, visit www.atalayamining.com
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