18 January 2024

Atalaya Mining Plc.

("Atalaya" or "the Company")

Q4 2023 Operations Update and 2024 Production Guidance

Steady performance and key project delivery expected in FY2024

Atalaya Mining Plc (AIM: ATYM) is pleased to announce its operations update for the fourth quarter of 2023 ("Q4 2023" or the "Period").

Proyecto Riotinto Operating Highlights

(1)   Figures for Q4 2023 are preliminary and final figures will be released with 2023 Annual Results.

Mining

Ore mined was 3.7 million tonnes in Q4 2023 (Q4 2022: 3.5 million tonnes), compared with 3.8 million tonnes in Q3 2023. Ore mined was 14.9 million tonnes in FY2023 (FY2022: 14.9 million tonnes).

Waste mined was 7.4 million tonnes in Q4 2023 (Q4 2022: 5.3 million tonnes), compared with 9.7 million tonnes in Q3 2023. Waste mined was 32.2 million tonnes in FY2023 (FY2022: 24.7 million tonnes). Increased waste mining was completed at Cerro Colorado in FY2023 to allow for the move of mining equipment to the San Dionisio area. 

Processing

The plant processed ore of 4.1 million tonnes during Q4 2023 (Q4 2022: 4.0 million tonnes), compared with 3.9 million tonnes in Q3 2023. Throughput was 15.8 million tonnes in FY2023 (FY2022: 15.4 million tonnes), again delivering plant performance above its 15 million tonne per annum nameplate capacity.

Copper grade was 0.36% in Q4 2023 (Q4 2022: 0.41%), compared with 0.38% in Q3 2023. Copper grade was 0.38% in FY2023 (FY2022: 0.40%). The copper grade in Q4 2023 was impacted in part by intense rainfall in November which prevented access to higher grade areas of the Cerro Colorado pit and required the use of low grade stockpiles to supplement plant feed.

Copper recovery in Q4 2023 was 85.39% (Q4 2022: 86.24%), compared with 87.00% in Q3 2023, due to lower grades being processed. Copper recovery in FY2023 was 86.63% (FY2022: 85.84%) as a result of better plant performance.

Production

Copper production was 12,775 tonnes in Q4 2023 (Q4 2022: 13,969 tonnes), compared with 12,541 tonnes in Q3 2023. Copper production was 51,667 tonnes in FY2023 (FY2022: 52,269 tonnes). Production for FY2023 was slightly below guidance as a result of lower grades, partly offset by higher ore throughput and recoveries.

On-site copper concentrate inventories at the end of Q4 2023 were approximately 6,722 tonnes.

Copper contained in concentrates sold was 12,928 tonnes in Q4 2023 (Q4 2022: 14,027 tonnes) and 50,808 tonnes in FY2023 (FY2022: 52,323 tonnes).

Select Financial Highlights

Realised Copper Price

The average realised copper price (excluding QPs closed during the Period) was $3.78/lb in Q4 2023 (Q4 2022: $3.70/lb), compared with $3.77/lb in Q3 2023. The average spot copper price was $3.71/lb in Q4 2023.

Provisional Revenue Adjustments

For Q4 2023, settlement adjustments (for QPs closed during the Period) and fair value adjustments (for open QPs based on copper forward curve prices as at 31 December 2023) were negative ?0.2 million.

Balance Sheet

The Company's balance sheet remains strong with consolidated cash and cash equivalents of ?119.7 million as at 31 December 2023.

Net of current and non-current borrowings of ?64.0 million, net cash was ?55.7 million as at 31 December 2023, compared with ?53.1 million as at 31 December 2022.

Electricity Prices

Estimated Realised Prices

Market electricity prices in Q4 2023 were lower than the other quarters of 2023, due to mild weather in much of Europe and a good contribution from wind generation in Iberia. After including the contribution from the Company's 10-year power purchase agreement ("PPA"), realised electricity prices in Q4 2023 and FY2023 were approximately 60% lower than the Company's average realised electricity price in 2022.

Renewable Energy Projects

Construction continues at the 50 MW solar plant at Riotinto. The first section is scheduled to be connected in mid-February, with the ramp-up of the remaining areas expected in the following months.   

When fully operational, the 50 MW solar plant 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 well below historical prices in Spain.

The Company continues to evaluate the potential installation of wind turbines at Riotinto, which could supply additional low cost and carbon-free electricity. Final wind resource assessment and wildlife impact reports are expected during 2024.

2024 Production Guidance

Copper production is expected to be 51,000 to 53,000 tonnes, consistent with FY2023 production levels, with FY2024 production weighted slightly towards H2 2024 as a result of the expected grade profile.

The Company will provide 2024 operating cost and capital expenditure guidance when it reports its 2023 Annual Results.

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. The AAU allows for the expansion of tailings capacity and the mine footprint at Riotinto and represents an important step towards developing regional deposits such as San Dionisio and San Antonio.

The Company is continuing with permitting activities associated with the San Dionisio final pit, which represents a key component of the integrated mine plan that was outlined in the 2023 Riotinto PEA. Initial stripping is underway in order to prepare the area for future mining phases.

E-LIX Phase I Plant

Development progress continues at the E-LIX Phase I site. Initial copper cathodes were produced in December 2023 during the commissioning of portions of the plant. Full commissioning and ramp-up of the facility are expected during H1 2024.

Once fully 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 an 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. In November 2023, the exploitation permit for the Masa Valverde and Majadales deposits was officially granted. Various optimisation workstreams continue.

Two core rigs are active and focused on step-out drilling at the Mojarra Trend and completing metallurgical and infill drilling at the Masa Valverde deposit.

Proyecto Touro

Atalaya remains fully committed to the development of the Touro copper project, which has the potential to provide substantial benefits to Galicia and also support the European Union's critical raw materials mandate.

Touro has the potential to become a new source of copper production for Europe. As such, the project could also be granted "Strategic Project" status by the EU, which can be awarded to projects "based on their contribution to the security of supply of strategic raw materials, their technical feasibility, sustainability and social standards", as part of the Critical Raw Materials Act. Copper was recently added to the list of "Strategic Raw Materials" owing to its importance for strategic sectors and technologies and due to the supply-demand imbalance that is expected in the near future.

Running parallel with the ongoing Touro permitting process, the Company continues to focus on numerous initiatives related to the social licence, including engaging with the many stakeholders in the region to provide detailed information on the new and 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 successfully restore the water quality of the 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 field-work carried out by Atalaya has resulted in an immediate and visible improvement of the water systems surrounding the project, with the progress being recognised by local stakeholders and the media.

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 and the La Hinchona copper-gold project, both in the central part of the district.  One drill hole was completed at the flagship Alconchel-Pallares copper-gold project.

Proyecto Riotinto East

Drill testing of selected coincident FLEM and AGG anomalies is in progress with one rig.

Corporate Activities Update

Re-domiciliation

On 12 December 2023, the Company held an Extraordinary General Meeting in relation to its intention to re-domicile the Company by transferring its registered office from the Republic of Cyprus to the Kingdom of Spain. All of the resolutions were approved by the Company's shareholders.

As a result, various procedural and legal steps are underway. Completion of the proposed re-domiciliation continues to be expected before the end of May 2024.

Intention to Move to the Main Market

As announced on 21 December 2023, the Company continues to progress its application process to the Financial Conduct Authority ("FCA") to admit its ordinary shares to the premium listing segment of the Official List and to trading on the London Stock Exchange plc's main market for listed securities.

Admission remains subject to a number of conditions including the approval by the FCA of a prospectus, and will not take place before the release of the Company's 2023 Annual Results.

Alberto Lavandeira, CEO, commented:

"We are pleased with the progress we achieved in 2023 across our business. Although grades were slightly lower than expectation, our processing plant performed well once again. We initiated stripping activities at the San Dionisio area, advanced construction at our 50 MW solar plant, and produced the first copper cathodes at the new E-LIX Phase 1 plant.

We have many reasons to be excited about 2024. We look forward to demonstrating the significant potential of the E-LIX System, expect to reduce our costs and carbon footprint via the ramp-up of the 50 MW solar plant, and are optimistic about the prospects of Proyecto Touro.

In terms of copper, recent events from across the industry continue to highlight the strategic value of producing assets located in safe geographies and the many challenges associated with increasing supply. We believe Atalaya is uniquely positioned thanks to its strong balance sheet, demonstrated development and operating expertise, and pipeline of growth projects located in Spain."

This announcement contains information which, prior to its publication constituted inside information for the purposes of Article 7 of Regulation (EU) No 596/2014.

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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