Atalaya Mining Plc (AIM: ATYM, TSX: AYM) is pleased to announce its operations update for the fourth quarter of 2021 ('Q4 2021' or the 'Period') and to provide production guidance for 2022.

Consistent performance in Q4 2021 with production exceeding expectations at 13,885 tonnes of copper due to better metallurgical recoveries which offset the slightly lower head grade.

A new annual production record of 56,139 tonnes of copper was achieved in 2021, exceeding Atalaya's increased guidance despite operational challenges and risks related to COVID-19 restrictions throughout the year.

In Q4 2021, 3.8 million tonnes of ore were milled with a copper recovery of 87.16%.

On-site concentrate inventories at the end of Q4 2021 were approximately 5,254 tonnes. All concentrate in stock at the beginning of the Period and produced during the Period was delivered to the port at Huelva.

Copper prices increased during Q4 2021 compared with Q4 2020 and Q3 2021, with an average realised price per pound of copper payable, including the QPs closed in the Period, of $4.36/lb compared with $4.31/lb in the previous quarter. The average copper spot price during the quarter was $4.40/lb. The realised price during Q4 2021 excluding QPs was approximately $4.40/lb.

All-in Sustaining Costs ('AISC') for 2021 are expected to be slightly below the lower end of the revised 2021 cost guidance due mainly to the U.S. dollar strengthening against the Euro and higher copper tonnes produced. Further details on costs will be provided with the 2021 Financial Statements to be reported in March 2022.

2022 Production Guidance

Atalaya's operating budget for 2022 was set in early December 2021 based on certain economic assumptions of expected inflation, particularly with respect to energy costs.

On this basis, full year 2022 copper production is estimated to be in the range of 54,000 to 56,000 tonnes.

Grade mined during 2022 is expected to be slightly higher than in 2021 owing to pit sequencing. In addition, the plant optimisation initiatives mentioned below are expected to further support copper production.

During December 2021 and the early days of January 2022, energy prices in Spain have increased significantly due to the sharp increase in wholesale European gas prices. Should the volatility and current energy prices persist for a sustained period, Atalaya expects that its operating budget and production guidance for 2022 may need to be revised.

The Company is actively monitoring energy prices on a daily basis and is identifying potential measures that could be implemented in response. In the event that energy prices remain at elevated levels for a sustained period, possible measures could include temporary modifications to the mine plan, curtailment of throughput during periods of peak energy prices or reductions in discretionary expenditures.

Proyecto Riotinto optimisation

During Q4 2021, some cost reduction initiatives were implemented including an expert system to control the SAG mill operations, resulting in lower energy consumption as well as associated reduction of CO2 emissions.

Permitting of a 50 MW solar plant for self-consumption has advanced and construction is expected to start in the next few weeks.

Flotation improvements have been implemented during 2021 with the use of new reagents focused on increased recoveries.

Tailings thickening capacity to be increased in 2022 to recover water with high pH resulting in a reduction of lime consumption.

Alberto Lavandeira, CEO commented: 'The Company has enjoyed another robust quarter culminating in record annual production for 2021. We enter 2022 with a proven operational track record, a range of exciting optimisation workstreams and a strengthened portfolio of growth opportunities. We are mindful of current inflationary pressures and while we shall endeavour to keep costs as low as possible, it is not unreasonable to assume that challenges lie ahead, particularly in relation to unprecedented energy costs. We remain confident that Atalaya is well positioned to navigate any current uncertainty while still investing in its portfolio of growth projects owing to its strong balance sheet. We have much to look forward to in 2022 with the advancement of our projects and exploration activities.'

Contact:

Elisabeth Cowell

Tel: + 44 20 3757 6880

About Atalaya Mining Plc

Atalaya is an AIM and TSX-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 centralised 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.

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