Atalaya Q1 copper production falls slightly over prior quarter

Atalaya Mining reported first quarter copper production at Proyecto Riotinto of 13,979 tonnes on Wednesday, which was 5.7% higher than the first quarter of 2020, but slightly lower than the fourth quarter due to lower copper grades and recoveries during the period.

The AIM-traded firm said that as a result of a “robust” copper price environment and strong mill performance, it was continuing to supplement mill feed with some stockpiled lower-grade ore to maximise the long-term value of the orebody.

The plant processed a record four million tonnes of ore during the first quarter of 2021, despite seven days of planned maintenance stoppage during February, which was offset by a new monthly performance record in March when 1.5 million tonnes was processed.

Atalaya said the increase in copper production, when compared with the company's expectations, was mainly attributable to better metallurgical recoveries and higher mill throughput.

Despite ongoing Covid-19 restrictions, mining operations had continued normally with higher production levels compared with the previous quarter, the board reported.

The lower quantity of ore mined from the pit, as per the mine plan, was compensated for by the delivery of stockpiles to the expanded plant.

On-site copper concentrate inventories at the end of the quarter totalled around 9,683 tonnes, with all concentrate in stock at the beginning of the period delivered to the port at Huelva.

Copper prices increased quarter-on-quarter, with an average realised price per pound of copper payable of $3.59, compared with $2.99 in the prior quarter.

The average copper spot price during the quarter was $3.85 per pound, and the realised price during the first quarter was about $3.84 per pound.

Cash operating costs for the period were expected to be below the company’s 2021 cost guidance, owing mainly to the euro-dollar exchange rate of $1.20, compared with the $1.22 it had budgeted in its 2021 guidance, as well as higher copper production.

Further details on costs would be provided with the firm’s first quarter financial statements in May, the board said.

“I am delighted to be able to report a quarter of strong progress at Proyecto Riotinto with an increase in copper production and record levels of ore processed through our newly expanded plant,” said chief executive officer Alberto Lavandeira.

“This strong performance means our annualised production rate for the quarter is towards the upper end of the 2021 production guidance range.”

Lavandeira said the firm would continue to assess and implement further cost reduction measures, in addition to those already successfully carried out during the quarter to drive mine efficiency and deliver increasing value for shareholders.

“The anticipated commissioning of our new solar power plant, once the permitting is completed, will bring both cost savings and significant reductions in the company's carbon footprint.”

At 0836 BST, shares in Atalaya Mining were down 1.74% at 316.9p.