Mr. Alberto Lavandeira reports
2017 OPERATIONS UPDATE AND 2018 GUIDANCE
Atalaya Mining PLC has provided its operations update for the calendar
year 2017 and has provided operational guidance for 2018.
PROYECTO RIOTINTO
Fourth quarter Third Full year
quarter
2017 2016 2017 2017 2016 2018 guidance
Ore mined (M tonnes) 2.5 2.3 2.4 9.3 6.8 9.7
Waste mined (M tonnes) 5.7 3.6 5.2 19.8 13.5 16.5
Ore milled (M tonnes) 2.3 2.0 2.2 8.8 6.5 9.6
Cu grade (%) 0.44 0.52 0.58 0.49 0.48 0.48
Cu recovery (%) 86.11 84.77 85.95 85.45 82.99 84-86
Cu production (tonnes) 8,622 8,938 10,679 37,164 26,179 37,000-40,000
Copper production at Proyecto Riotinto for 2017, the first full year of commercial production, was
37,164 tonnes up from 26,179 tonnes reported in 2016. For 2017 the operation reported a cumulative
throughput rate of 8.8 million tonnes per annum with average copper head grade of 0.49 per cent and a recovery rate of 85.45 per cent. On
a comparative basis to 2016, throughput has increased as operations were stabilized, copper grade was
consistent with estimates and recovery has improved materially. Throughput rates and recoveries for
Q4 were slightly better than in Q3 with copper head grade impacting metal contained in concentrate.
Third quarter 2017 reported record quarterly copper production at Riotinto.
Guidance for copper production for 2018 is estimated to be in the range of 37,000 to 40,000 tonnes.
Mining operations are now running stable quarter on quarter. On a combined basis, ore, waste and
3:3
marginal ore amounted to 3.1 million in Q4 2017 versus 2.7 million in Q3 2017. The new mining fleet,
commissioned during the previous quarter, is now fully operational. Two additional production drill rigs
and a 90,000-litre water bowser were delivered to site. At the processing plant, hourly throughput rate
has improved compared with previous quarters owing to higher equipment availability.
As part of the company's continuous improvement program, the installation of an additional
secondary cone crusher is under evaluation. Liner installation at the tailings storage facilities was
completed during the quarter. Improvements to process and water supply systems are under way.
Rehabilitation trials were initiated in the first bench of the south waste dump facility. Dust emission
indicators remain below legal requirements. Installation of a dome covering the coarse ore stockpile to
help with dust control is continuing with civil foundations completed and structural fabrication under way.
Dewatering of the Atalaya pit continues as previously reported.
On-site concentrate inventories at the end of the quarter were approximately 3,000 tonnes. All
concentrate in stock at the beginning of the quarter and produced during the quarter was delivered to
the port at Huelva.
Copper prices rose during the quarter with an average realized price per pound of copper payable,
including the QPs closed in the period, of $2.87/pound compared with $2.18/lb in Q4 2016 and $2.66/lb in
Q3 2017. The average spot copper price during the quarter was $3.09/lb. The realized price of
shipments during the quarter excluding QPs was approximately $3.10/lb.
All-in sustaining costs (AISC) for 2017 slightly increased mainly driven by the foreign exchange rate of
U.S. dollar and euro. Further details on operating cost will be provided together with the financial statements
but management expects AISC to be in the range of $2.05/lb to $2.20/lb.
Near-mine exploration continued drilling the northwest extension of the Cerro Colorado pit. An infill
drilling campaign in Cerro Colorado pit was initiated and is planned to last for most of 2018. An updated
resources and reserves statement is being prepared as part of the expansion to the 15 Mtpa project. An
airborne VTEM geophysical survey was completed during the quarter with results expected in Q1 2018.
The archeological investigation currently under way in a section of the northern wall of Cerro Colorado
pit has progressed down to the first of three levels. The program is scheduled to last for all of 2018
with the area then released for mining after completion.
Expansion to 15 Mtpa at Proyecto Riotinto
The expansion project to 15 Mtpa was formally approved during Q4 2017 and therefore launched at the
beginning of December, 2017. Process flowsheet, basic design criteria and preliminary layouts were
established. Financing to initiate the expansion was raised through a placing of new shares and this
allowed long-lead equipment to be identified following a tender process and purchase orders were
issued according to the schedule. The expansion is on track to deliver increased production by 2019.
Proyecto Touro
Permitting of Proyecto Touro continues to progress according to schedule. A number of reports were
received as part of the permitting process where certain project improvements have been suggested.
The company has already engaged a number of consultants to address these recommendations.
The technical report is substantially completed at prefeasibility level of detail and in compliance with National Instrument 43-101 guidelines. The report will be released when the additional project improvements are
incorporated to accommodate the final permitting process.
The exploration campaign initiated the previous quarter on newly optioned exploration concessions
around Proyecto Touro is under way. As part of the campaign a first phase of an airborne
VTEM geophysical survey was completed with results expected in Q1 2018.
Alberto Lavandeira, chief executive officer, commented:
"Our first full year of production has been very satisfactory with continuously improving throughput and
recoveries at historic highs and we are confident that our production guidance for 2018 will be on track.
The decision to increase the plant's throughput to 15 Mtpa marks another milestone in the regeneration
of Proyecto Riotinto and we look forward to announcing revised reserves and resources in due course to
meet this expansion. The VTEM geophysical surveys conducted at both Riotinto and Touro are complete
and we expect the results to be forthcoming during the first quarter."
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