Atalaya Mining PLC Second quarter operations update (5068M)
31 July 2017 - 4:00PM
UK Regulatory
TIDMATYM
RNS Number : 5068M
Atalaya Mining PLC
31 July 2017
31 July 2017
Atalaya Mining Plc
("Atalaya" or the "Company")
Second Quarter 2017 Operations Update
Atalaya Mining plc (AIM:ATYM, TSX:AYM), the European mining and
development company, announces its operations update for the three
months ended June 30, 2017.
PROYECTO RIOTINTO
Second Quarter First Full year
Quarter forecast
----------------------------- ----------------- --------- ----------
2017 2016 2017 2017
--------------- ------------ -------- ------- --------- ----------
Ore mined (M tonnes) 2.3 1.3 2.3 9.5 - 9.8
--------------- ------------ -------- ------- --------- ----------
18.1 -
Waste mined (M tonnes) 4.6 3.8 4.3 18.2
--------------- ------------ -------- ------- --------- ----------
Ore milled (M tonnes) 2.2 1.3 2.2 9.5
--------------- ------------ -------- ------- --------- ----------
0.49 -
Cu grade (%) 0.49 0.44 0.48 0.51
--------------- ------------ -------- ------- --------- ----------
Cu recovery (%) 85.09 79.80 84.63 79 - 82
--------------- ------------ -------- ------- --------- ----------
34,000
Cu production (tonnes) 9,058 4,442 8,805 - 40,000
--------------- ------------ -------- ------- --------- ----------
Production results at Proyecto Riotinto have improved compared
to the previous quarter and were in line with targets for the
quarter ended June 30, 2017. The operation reports throughput rate
of 2.2 million tonnes of ore processed, similar to the previous
quarter with an improvement in the recovery rate to a record of
85.09%. The overall tonnage processed was affected negatively by
the replacement of one of the main transformers to improve energy
efficiencies. Full year forecasts for copper production remain as
previously guided at 34,000 - 40,000 tonnes.
Mining operations are running at an increasing rate
quarter-on-quarter, as a result of adjusted drilling and blasting
parameters. On a combined basis, ore, waste and marginal ore
amounted to 2.8 Mm(3) in Q2 2017 versus 2.5 Mm(3) in Q1 2017. The
mining contractor has launched a replacement programme for the
mining fleet. New loaders and trucks are expected to be delivered
to site over the next two quarters in anticipation of a potential
increase in mining rates. Additionally, modifications to the
primary milling circuit, which includes a pebble crusher in closed
circuit with the primary mill, have already reported better milling
efficiencies.
The Company continues to implement initiatives to reduce
operating costs of the mine such as adding additional rougher
flotation capacity in order to increase plant recoveries and
installing a partial plastic lining to parts of the tailings pond
to improve water recycle management.
A number of dust emission mitigation measures have been
developed over the last two quarters with positive results
reported. Dust emissions were significantly reduced compared with
previous indicators. This initiative will be complete at the end of
the year with the installation of a dome covering the coarse ore
stockpile. At the end of the quarter, the Cerro Colorado pit was
nearly dewatered with only 92,000 m(3) of water remaining.
On-site concentrate inventories at the end of the quarter were
reduced to minimum levels. All concentrate in stock at the
beginning of the quarter and produced during the quarter were
delivered to the port at Huelva. Concentrate sales were not
affected by disruptions reported at other ports across Spain.
Copper prices continued to rise during the quarter with an
average realised price per pound of copper payable of $2.61/lb
compared with $2.27/lb in Q4 2016 and $2.41/lb in Q1 2017 and
average market copper price in the quarter of $2.57/lb.
Management expect AISC to be in line with previous quarters with
the full year forecast as previously guided in the range of
$1.90/lb to $2.10/lb.
The good performance of the operations and stable copper prices
allowed the company to continue to reduce its working capital
deficit. This cash generation allowed the full payment of the old
Social Security debt (EUR16.9m) that had been inherited with the
mining concession. The Company filed a formal claim in the
Administrative Court, relating to the previously announced
government grant of EUR8.8m and has fully written off the amount in
its financial statements.
Near-mine exploration drilling continued from the previous
quarter with a programme to test the lateral extension of Filon
Sur. With the programme now essentially complete the exploration
block model has been updated with results to be part of the
resources and reserves update that will form part of the studies
related to the Expansion to 15 Mtpa Project. The in-fill drilling
campaign at Cerro Colorado was mainly centred in the north-western
extension of the pit where better than anticipated mineralised
intervals and grades have been discovered. This campaign is
targeting inferred resources with the objective of increasing
confidence levels and potential reclassification.
As part of the Company's Corporate Social Responsibility
initiatives a significant archaeological programme was launched in
June 2017 to study a number of archaeological sites including
Cortalago, a Roman mining settlement of relevance. The programme is
expected to last for 12 months.
PROYECTO TOURO
The Company has signed an option agreement to acquire
exploration concessions that cover 122.7 km(2) immediately
surrounding Proyecto Touro, where mineralised copper occurrences
are documented. An ambitious exploration programme and budget are
under consideration for Board approval.
Permitting of Proyecto Touro is progressing according to
schedule. Studies and applications were submitted at the end of the
quarter to the regional authorities for review and evaluation.
Consultations with different administrative bodies have been held
and local and regional stakeholders have been engaged in the
process, with positive feedback received.
As previously reported, two important milestones have been
achieved at Proyecto Touro: the first was the successful completion
of metallurgical test-work which has demonstrated that high grade
clean concentrates and high recovery rates can be achieved. The
second was the completion of 26,557 m of exploration and in-fill
drilling which will provide the basis of an NI 43-101 technical
report.
The technical report is progressing ahead of schedule and is at
an advanced stage of development. It is expected to be at a
pre-feasibility level of detail in the near future, with completion
brought forward to the beginning of Q4 from the original estimate
of the end of FY 2017.
Alberto Lavandeira, CEO commented:
"I am pleased to be able to report on a successful quarter for
the business. Copper production levels at Proyecto Riotinto have
increased and we remain confident in our full year production
target of 34,000-40,000 tonnes. Ongoing upgrades and developments
at Proyecto Riotinto are producing encouraging results, as the
Company continues to expand its operations and commercial
production capabilities. The progress made during the quarter with
Proyecto Touro also gives us increased confidence in the viability
and scope of a potential second operating mine. We look forward to
further improvements with both projects during the course of the
second half of the year."
This announcement contains inside information for the purposes
of Article 7 of Regulation (EU) no 596/2014.
Contacts:
Charles Chichester
/ James Ash / James +44 20 7680
Newgate Communications Browne 6550
------------------------ --------------------------- ------------
Canaccord Genuity Henry Fitzgerald-O'Connor
(NOMAD and Joint / Martin Davison +44 20 7523
Broker) / James Asensio 8000
------------------------ --------------------------- ------------
BMO Capital Markets Jeffrey Couch / Neil +44 20 7236
(Joint Broker) Haycock / Tom Rider 1010
------------------------ --------------------------- ------------
This information is provided by RNS
The company news service from the London Stock Exchange
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