TIDMATYM
RNS Number : 7121F
Atalaya Mining PLC
12 July 2023
Atalaya Mining Plc
1 Lampousas Street
1095 Nicosia, Cyprus
Tel: +357 22442705
Fax: +357 22442708
www.atalayamining.com
12 July 2023
Atalaya Mining Plc.
("Atalaya" or "the Company")
Q2 2023 Operations Update
Strong quarter of production supports confidence in full year
guidance
Atalaya Mining Plc (AIM: ATYM, TSX: AYM) is pleased to announce
its operations update for the second quarter of 2023 ("Q2 2023" or
the "Period").
Proyecto Riotinto Operating Highlights
Q2 Q1 Full Year
2023(1) 2022 2023 2023 Guidance
---------------------------- -------- ------- --------------
Ore mined (M tonnes) 3.9 3.6 3.4 17.1
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Waste mined (M tonnes) 8.6 6.7 6.5 24.1
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Ore milled (M tonnes) 4.1 4.0 3.7 15.3 - 15.8
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Cu grade (%) 0.40 0.39 0.38 0.40 - 0.42
------------ -------- ------- ------- --------------
Cu recovery (%) 87.18 86.44 86.88 85 - 86 (2)
------------ -------- ------- ------- --------------
53,000 -
Cu production (tonnes) 14,212 13,386 12,139 55,000
------------ -------- ------- ------- --------------
(1) Figures for Q2 2023 are preliminary and final figures will
be released with Q2 2023 financial results.
(2) Represents updated guidance range for copper recovery.
Mining
Ore mined was 3.9 million tonnes in Q2 2023 (Q2 2022: 3.6
million tonnes), compared with 3.4 million tonnes in Q1 2023.
Waste mined was 8.6 million tonnes in Q2 2023 (Q2 2022: 6.7
million tonnes), compared with 6.5 million tonnes in Q1 2023. Waste
mining during the Period was consistent with budget and includes
increased waste stripping at Cerro Colorado in anticipation of the
potential start of mining activities at San Dionisio in late
2023.
Processing
The plant processed ore of 4.1 million tonnes during Q2 2023 (Q2
2022: 4.0 million tonnes), compared with 3.7 million tonnes in Q1
2023. Throughput rates during the Period reflected strong mill
performance following the prior rescheduling of plant maintenance
activities into Q1 2023.
Copper grade was 0.40% in Q2 2023 (Q2 2022: 0.39%), compared
with 0.38% in Q1 2023.
Copper recoveries in Q2 2023 were 87.18% (Q2 2022: 86.44%),
compared with 86.88% in Q1 2023, as a result of favourable ore
characteristics during the Period.
Production
Copper production was 14,212 tonnes in Q2 2023 (Q2 2022: 13,386
tonnes), compared with 12,139 tonnes in Q1 2023. Production during
the Period benefited from strong throughput and copper
recoveries.
On-site copper concentrate inventories at 30 June 2023 were
approximately 7,291 tonnes (31 March 2023: 1,564 tonnes). All
concentrate in stock at the beginning of the Period was delivered
to the port at Huelva.
Copper contained in concentrates sold was 12,858 tonnes in Q2
2023 (Q2 2022: 13,872 tonnes), compared with 12,501 tonnes in Q1
2023.
Select Financial Highlights
Realised Copper Price
The average realised copper price (excluding QPs closed during
the Period) was $3.81/lb in Q2 2023 (Q2 2022: $4.28/lb), compared
with $4.00/lb in Q1 2023. The average spot copper price was
$3.85/lb in Q2 2023.
Provisional Revenue Adjustments
For Q2 2023, settlement adjustments (for QPs closed during the
Period) and fair value adjustments (for open QPs based on copper
forward curve prices as at 30 June 2023) were negative EUR0.7
million.
Balance Sheet
The Company's balance sheet remains strong with consolidated
cash and cash equivalents of EUR112.6 million at 30 June 2023.
Net of current and non-current borrowings of EUR43.9 million,
net cash was EUR68.8 million as at 30 June 2023, compared with
EUR53.1 million as at 31 December 2022.
Electricity Prices
Estimated Realised Prices
Market electricity prices in Q2 2023 continued to moderate. When
including the contribution from the Company's 10-year power
purchase agreement ("PPA"), realised electricity prices in Q2 2023
were around 60% lower than the Company's average realised
electricity price in 2022.
Renewable Energy Projects
Construction of the 50 MW solar plant at Riotinto continues to
advance, with start-up expected in late 2023 or early 2024
following some minor delays. When fully operational, the facility
is expected to provide approximately 22% of Riotinto's current
electricity needs. Together, the 50 MW solar plant and long-term
PPA will provide over 50% of the Company's current electricity
requirements at a rate below historical prices in Spain.
The Company is also progressing studies associated with the
potential installation of wind turbines at Riotinto, which could
supply additional low cost and carbon-free electricity and
contribute to the Company's decarbonisation objectives.
2023 Guidance
The Company remains on track to achieve the full year 2023
guidance, including copper production guidance of 53,000 to 55,000
tonnes of copper at cash costs of $2.80 to $3.00/lb copper payable
and AISC of $3.00 to $3.20/lb copper payable.
Asset Portfolio Update
Proyecto Riotinto
In April 2023, the Company was granted a substantial
modification to the existing Unified Environmental Authorisation
(or in Spanish, Autorización Ambiental Unificada ("AAU")) for
Proyecto Riotinto by the Junta de Andalucía. This allows for the
expansion of tailings capacity at Riotinto and represents an
important step towards developing regional deposits such as San
Dionisio and San Antonio.
During the Period, the Company continued permitting activities
associated with San Dionisio, which represents a key component of
the integrated mine plan that was outlined in the recent Riotinto
PEA.
E-LIX Phase I Plant
Construction activities continue at the E-LIX Phase I plant,
with commissioning e xpected in H2 2023 .
Once operational, the E-LIX plant is expected to produce high
purity copper or zinc metals on site, allowing the Company to
potentially achieve higher metal recoveries from complex
polymetallic ores, lower transportation and concentrate treatment
charges and a reduced carbon footprint.
Riotinto District - Proyecto Masa Valverde ("PMV")
In March 2023, the Company announced that PMV was granted the
AAU by the Junta de Andalucía, following an application process
that was initiated by the Company in December 2021. The AAU is an
integrated process that combines the Environmental Impact
Assessment and other authorisations and specifies requirements to
avoid, prevent and minimise a project's impacts on the environment
and the cultural heritage of the area. Various evaluation
workstreams continue in advance of filing for the exploitation
permit.
Three core rigs are active and focused on resource definition
drilling at the Campanario Trend, step-out drilling around the new
discovery made at the Mojarra Trend and first drill testing
coincident fix loop electromagnetic ("FLEM") and airborne gravity
gradiometry ("AGG") anomalies.
Proyecto Touro
Atalaya remains fully committed to the development of the Touro
copper project in Galicia, which could become a new source of
copper production for Europe.
In March 2023, the European Union announced the Critical Raw
Materials Act, which seeks to "address the EU's dependency on
imported critical raw materials by diversifying and securing a
domestic and sustainable supply of critical raw materials". Copper
was added to the list of "Strategic Raw Materials" as a result of
the challenges associated with substituting copper metal in
electrical applications.
Running parallel with the Touro permitting process, the Company
continues to focus on numerous initiatives related to securing the
social licence to operate, including engaging with the many
stakeholders in the region to provide detailed information on the
new improved project design. Positive and favourable feedback from
numerous meetings with municipalities, farmers and fishermen
associations and other industries indicate meaningful support
towards the development of a new and modern mining project.
The Company continues to restore rivers around Touro and is
operating its water treatment plant, which is addressing the legacy
issues associated with acid water runoff from the historical mine,
which closed in 1987. The construction of the treatment plant was
contemplated in the original project proposal, but Atalaya
volunteered to fix the historical acid water issues prior to the
new Environmental Impact Assessment ("EIA") in order to demonstrate
its operating philosophy and the benefits of modern operating
systems. The field work carried out by Atalaya has resulted in an
immediate and visible improvement of the water systems surrounding
the project.
Atalaya continues to be confident that its approach to Touro,
which includes fully plastic lined thickened tailings with zero
discharge, is consistent with international best practice and will
satisfy the most stringent environmental conditions that may be
imposed by the authorities prior to the development of the
project.
Proyecto Ossa Morena
Drilling continued to progress with one rig at the
Guijarro-Chaparral gold-copper project, located in the central part
of the district. Drilling at the flagship Alconchel-Pallares
copper-gold project is expected to commence during Q3 2023.
Proyecto Riotinto East
Drill testing of selected coincident FLEM and AGG anomalies are
in progress with one rig.
Corporate Matters
Following the voluntary delisting of the Company's ordinary
shares from the Toronto Stock Exchange ("TSX"), an application was
made to cease to be a reporting issuer in Canada. The request was
granted during the Period, and as a result, the Company will no
longer be required to file financial statements and other
continuous disclosure documents in Canada.
The Company's disclosure obligations under the AIM Rules for
Companies, as published by London Stock Exchange plc, are
unchanged.
Alberto Lavandeira, CEO, commented:
"We are pleased to report a strong quarter of production, thanks
to a solid performance at the plant including good throughput and
recoveries. We remain confident in our full year operational
guidance.
Although the copper price has softened in recent months, the
overall outlook is far better than many market participants had
predicted for 2023. Once again, supply disruptions in many key
copper producing regions have improved the near-term market
balance.
In the medium term, we remain confident on the outlook for
copper, given its critical role in the energy transition and the
increasing challenges faced by the industry to deliver new supply.
At Atalaya, we are fortunate to control a substantial resource base
and a large-scale processing facility, which will allow us to grow
production for Europe and other global markets."
Contacts:
Elisabeth Cowell / Tom
SEC Newgate UK Carnegie / Matthew Elliott + 44 20 3757 6882
4C Communications Carina Corbett +44 20 3170 7973
------------------------------- ------------------
Canaccord Genuity Henry Fitzgerald-O'Connor
(NOMAD and Joint / James Asensio / Thomas
Broker) Diehl +44 20 7523 8000
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BMO Capital Markets
(Joint Broker) Tom Rider / Andrew Cameron +44 20 7236 1010
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Peel Hunt LLP
(Joint Broker) Ross Allister / David McKeown +44 20 7418 8900
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About Atalaya Mining Plc
Atalaya is an AIM-listed mining and development group which
produces copper concentrates and silver by-product at its wholly
owned Proyecto Riotinto site in southwest Spain. Atalaya's current
operations include the Cerro Colorado open pit mine and a modern 15
Mtpa processing plant, which has the potential to become a central
processing hub for ore sourced from its wholly owned regional
projects around Riotinto that include Proyecto Masa Valverde and
Proyecto Riotinto East. In addition, the Group has a phased earn-in
agreement for up to 80% ownership of Proyecto Touro, a brownfield
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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END
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