REG - Atalaya Mining PLC - Best copper intercept to date at Masa Valverde

Atalaya MiningAnnouncement

03/02/2022 07:00

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RNS Number : 5266A  Atalaya Mining PLC  03 February 2022

 

A version of this announcement containing all referenced maps can be found on
the Company's website at www.atalayamining.com
(http://www.atalayamining.com/)  (the "Website Announcement").

 

03 February 2022

Atalaya Mining Plc.

("Atalaya" or the "Company")

 

Atalaya Intercepts 125m at 1.19% Cu at Masa Valverde, including 19m at 2.56%
Cu

 

Represents the best copper intercept to date at Proyecto Masa Valverde

 

Atalaya Mining Plc (AIM:ATYM, TSX:AYM) is pleased to announce the results of
five additional drill holes from its ongoing resource definition drilling
programme at Proyecto Masa Valverde ("PMV"). PMV is located in southern Spain
approximately 28 km to the south of Atalaya's 15Mtpa mill at Proyecto Riotinto
(see Fig 1 on the Website Announcement).

 

Highlights

·    New drill results include best continuous copper intercept at PMV to
date: 125 metres at 1.19% Cu, including high grade intervals of 12m at 2.29%
Cu, 19m at 2.56% Cu and 15m at 2.27% Cu.

 

·    Results are expected to increase the copper grade in the upcoming NI
43-101 resource estimate for PMV, which is planned for release by the end of
March 2022.

 

·   Higher grade material from PMV has the potential to displace ore from
the Cerro Colorado pit, allowing the Company to increase its copper production
while maintaining current processing rates.

 

·    Intersected mineralisation is mostly stockwork-type with minor
massive sulphides, which is expected to have positive metallurgical
implications.

 

·    Three rigs continue to drill at PMV, as part of the Company's €10
million exploration programme for 2022.

The objective of the ongoing drilling programme at PMV is to confirm, improve
and expand the historical NI 43-101 compliant inferred resource of 66Mt at
0.67% Cu, 1.92% Zn, 0.90% Pb, 0.63 g/t Au and 34 g/t Ag. In addition to the
Masa Valverde deposit, PMV also includes Majadales, which was discovered in
2019 and was not included in any previous resource estimates, as well as
several geophysical and geochemical drill-ready targets.

 

Drilling Results Overview

The five holes included in this release are infill holes drilled within the
existing historical resource estimate of the Masa Valverde deposit. Each of
these holes encountered broad intervals of massive, semi-massive and
stockwork-type sulphide mineralisation at anticipated target depths.

More importantly, two of them (MJ-43 and MJ-45) returned the deposit's best
continuous copper intercepts to date in terms of grade / thickness factor: 125
metres at 1.19% Cu (or 1.56% CuEq) and 179 metres at 0.87% Cu (or 1.72% CuEq)
respectively. Atalaya expects these intercepts will contribute to an increase
in the average copper grade of the upcoming NI 43-101 resource estimate, which
is planned for release by the end of March 2022.

Sourcing higher grade material from within the Riotinto District is central to
Atalaya's strategy to grow its copper production. Ore from deposits such as
PMV has the potential to displace feed from the Cerro Colorado pit, allowing
the Company to increase production while maintaining its current processing
rates.

Other highlights include the high gold grades encountered in many of the
intercepts, including 25 metres at 2.09 g/t Au in hole MJ-42 and 43 metres at
1.42 g/t Au in hole MJ-44.

Selected drill hole intercepts are shown in Table 1 below.

Table 1: Selected Drill Holes

 DDH        From  To    Interval  CuEq(1)  Cu    Zn    Pb    Au      Ag

(m)
(m)
(m)
(%)
(%)
(%)
(%)
(g/t)
(g/t)

 MJ42       496   618   122       2.17     0.52  1.55  1.20  0.94    41
 Including  496   521   25        2.86     0.63  0.08  1.52  2.09    71
 Including  525   559   34        3.63     0.37  5.16  2.73  1.09    53
 MJ43       529   654   125       1.56     1.19  0.27  0.24  0.19    14
 Including  556   568   12        2.90     2.29  0.91  0.72  0.12    13
 Including  578   597   19        2.79     2.56  0.18  0.02  0.17    8
 Including  637   652   15        2.43     2.27  0.13  0.05  0.04    10
 MJ45BIS    470   649   179       1.72     0.87  0.92  0.35  0.56    18
 Including  470   492   22        3.69     0.78  2.35  2.29  1.94    61
 Including  485   492   7         5.30     0.73  7.07  4.68  1.49    59
 Including  607   649   42        1.99     1.34  1.25  0.03  0.35    6

(1) Metal prices used: Cu 4.00 USD/lb, Zn 1.20 USD/lb, Pb 0.90 USD/lb, Ag 22
USD/oz, Au 1700 USD/oz. Copper Equivalent (CuEq) values are for exploration
purposes only and no metallurgical recovery was applied.

Complete results from these holes are shown in Table 2 below.

Drilling is currently continuing at PMV with three rigs. Two rigs are
conducting infill and step out drilling at Majadales while the third is drill
testing one of the recently defined fixed loop electromagnetic (FLEM)
anomalies located west of the Masa Valverde deposit.

 

Alberto Lavandeira, CEO, commented: "These new drill results have exceeded our
expectations in many ways, most notably in terms of the copper and gold
grades, confirming our belief that Proyecto Masa Valverde is one of the best
undeveloped polymetallic projects in the Iberian Pyrite Belt and also in
Europe.

 

"High copper grades over significant true thicknesses bodes well for the NI
43-101 compliant resource statement scheduled for late Q1 2022 and also opens
the possibility to consider large scale underground mining scenarios for
future project development. The high gold grades encountered are particularly
notable now that Atalaya has approved construction of an industrial-scale
E-LIX plant, which has the potential to extract economically many key metals
from polymetallic deposits, including copper, zinc and gold.

 

"Finally, we have increased Atalaya's exploration budget to €10 million for
2022 will allow the Company to continue to advance PMV together with initial
exploration works at Proyecto Riotinto East and the recently acquired Proyecto
Ossa Morena."

 

Further Commentary on PMV Drilling Results

As of 24 January 2022, a total of 10,758 metres over 18 holes have been
drilled at PMV by Atalaya during the current exploration campaign, of which
ten holes relate to the Masa Valverde deposit and the rest to Majadales. Three
of these holes are still in progress. (see Fig 2 on the Website Announcement).

Since the last PMV exploration update released on 6 October 2021, seven
additional holes were drilled with complete assay results having been received
for five holes. The five holes for which results are being announced today
were all drilled as infill holes at the Masa Valverde deposit and intersected
massive, semi-massive and stockwork-type polymetallic sulphide mineralisation
at anticipated target depths (see Fig 3 on the Website Announcement).

The most notable hole is MJ43 because it returned the single best copper
intercept drilled to date at the Masa Valverde deposit: 125 metres at 1.19%
copper using a 0.3% Cu cut-off. This intersection is particularly relevant for
the following reasons:

·    It returned high copper grades within an area that previously
represented a significant gap between previous drill holes and the
southwestern limit of the deposit, enhancing the potential for lateral
extension (NW-SE) of this new high grade copper mineralisation (see Fig 4 on
the Website Announcement).

·    It includes three higher grade intervals of 12 metres at 2.29% Cu, 19
metres at 2.56% Cu and 15 metres at 2.27% Cu (see Fig 5 on the Website
Announcement).

·   The sulphide mineralisation is mostly stockwork-type with minor massive
sulphides, which is expected to have positive metallurgical implications, due
to the low associated contents of zinc, lead and potential deleterious
elements.

·    From a geological perspective the mineralisation is located proximal
to a major NW-SE trending fault that limits the deposit to the south and which
is interpreted as a potential feeder structure. If so, this will have positive
exploration implications because will help to define vectors towards the
higher-grade copper zones in other sectors of the deposit.

It is also worth noting the high gold grades encountered in most of the holes.
The current interpretation suggests that the high gold grades appear in the
upper part of the mineralised body, demonstrate good continuity along strike
and indicates that the gold is associated mainly with massive and semi-massive
sulphides. (see Fig 6 on the Website Announcement). Petrographic and
mineralogical studies are currently in progress in order to better understand
the detailed gold distribution.

Table 2 below provides detailed results from these five holes.

Table 2: Drill Hole Data

 Hole ID  Length     From (m)  To     Interval  CuEq(2)  Cu    Zn    Pb    Au      Ag

(m)

(m)
(%)

                               (m)                       (%)   (%)   (%)   (g/t)   (g/t)

 MJ42     794.8      496.0     618.0  122.0     2.17     0.52  1.55  1.20  0.94    41
          Including  496.0     521.0  25.0      2.86     0.63  0.08  1.52  2.09    71
          Including  525.0     559.0  34.0      3.63     0.37  5.16  2.73  1.09    53
          Including  594.0     618.0  24.0      1.28     0.87  0.31  0.16  0.20    20
 MJ43     803.1      529.0     654.0  125.0     1.56     1.19  0.27  0.24  0.19    14
          Including  554.0     654.0  100.0     1.70     1.41  0.28  0.22  0.14    9
          Inc.       556.0     568.0  12.0      2.90     2.29  0.91  0.72  0.12    13
          Inc.       578.0     597.0  19.0      2.79     2.56  0.18  0.02  0.17    8
          Inc.       637.0     652.0  15.0      2.43     2.27  0.13  0.05  0.04    10
 MJ44     854.2      554.4     587.0  32.6      1.56     0.54  0.03  0.10  0.84    58
                     621.0     730.0  109.0     1.22     0.56  0.24  0.16  0.60    23
          Including  621.0     664.0  43.0      2.09     0.65  0.20  0.35  1.42    53
          Including  692.0     710.0  18.0      1.23     0.99  0.53  0.05  0.04    5
 MJ45BIS  757.2      470.0     649.0  179.0     1.72     0.87  0.92  0.35  0.56    18
          Including  470.0     492.0  22.0      3.69     0.78  2.35  2.29  1.94    61
          Inc.       485.0     492.0  7.0       5.30     0.73  7.07  4.68  1.49    59
          Including  607.0     649.0  42.0      1.99     1.34  1.25  0.03  0.35    6
 MJ46     779.7      492.5     517.0  24.5      2.43     0.62  1.25  0.64  1.43    50
          Including  510.0     517.0  7.0       3.48     0.58  4.12  1.79  1.21    64
                     558.0     564.0  6.0       1.84     1.55  0.16  0.07  0.24    10
                     584.0     594.0  10.0      1.04     0.88  0.13  0.01  0.13    5
                     662.0     712.0  50.0      1.38     0.85  0.37  0.35  0.34    16
          Including  662.0     698.0  36.0      1.54     1.06  0.51  0.37  0.23    12
          Inc.       664.0     670.0  6.0       4.36     3.16  1.70  0.96  0.48    22

(1 Table showing detailed drill results over significant sulphide mineralised
intervals. Assays from ALS Lab.)

(2 Metal prices used: Cu 4.00 USD/lb, Zn 1.20 USD/lb, Pb 0.90 USD/lb, Ag 22
USD/oz, Au 1700 USD/oz. Copper Equivalent (CuEq) values are for exploration
purposes only and no metallurgical recovery was applied.)

 

Ongoing Work Programme

Compilation and interpretation of the drill hole data and resource modelling
are currently underway. The NI 43-101 compliant resource estimate is expected
to be announced by the end of Q1 2022.

Preliminary standard flotation metallurgical work is ongoing at a specialised
laboratory in Canada. In addition, representative samples of the main
mineralisation styles of both the Masa Valverde and Majadales deposits have
been selected and sent for preliminary leaching tests with the E-LIX System.

Drilling will continue with three rigs with the aim of improving and expanding
the historical resources of PMV, to drill the new geophysical anomalies
delineated as a result of the comprehensive FLEM survey recently completed and
first drilling at the promising Campanario target.

Qualified Person Statement

Alberto Lavandeira has reviewed the technical information contained within
this announcement in his capacity as a Qualified Person, as required under the
AIM Rules for Companies. Alberto Lavandeira is the Chief Executive Officer for
the Company and is a member of good standing with the Association of Mining
Engineers of Spain, with over 41 years' experience.

Glossary of Terms

 Ag                         Silver
 As                         Arsenic
 Au                         Gold
 Cu                         Copper
 Co                         Cobalt
 FLEM                       Fixed Loop Electromagnetic Survey
 g/t                        Grams per tonne
 Gal                        Unit of gravity
 Hg                         Mercury
 Inferred mineral resource  That part of a Mineral Resource for which quantity, grade or quality,
                            densities, shape and physical characteristics are estimated with sufficient
                            confidence to allow the application of Modifying Factors in sufficient detail
                            to support mine planning and evaluation of the economic viability of the
                            deposit. Geological evidence is derived from adequately detailed and reliable
                            exploration, sampling and testing and is sufficient to assume geological and
                            grade or quality continuity between points of observation. An Indicated
                            Mineral Resource has a lower level of confidence than that applying to a
                            Measured Mineral Resource and may only be converted to a Probable Mineral
                            Reserve.
 Mt                         Million tonnes
 n.a.                       Not available
 N.I. 43-101                Canadian National Instrument for the standards of Disclosure for Mineral
                            Projects
 Pb                         Lead
 PPM                        Part per million
 Stockwork                  It's a complex 3D network of structurally controlled or randomly oriented
                            veins. They are common in many ore deposit types. They are also referred to as
                            stringer zones.
 Zn                         Zinc

 

Contacts:

 SEC Newgate UK             Elisabeth Cowell / Axaule Shukanayeva / Max Richardson  + 44 20 3757 6882
 4C Communications          Carina Corbett                                          +44 20 3170 7973
 Canaccord Genuity          Henry Fitzgerald-O'Connor / James Asensio               +44 20 7523 8000

 (NOMAD and Joint Broker)
 BMO Capital Markets        Tom Rider / Andrew Cameron                              +44 20 7236 1010

 (Joint Broker)
 Peel Hunt LLP              Ross Allister / David McKeown                           +44 20 7418 8900

 (Joint Broker)

 

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. For further information, visit
www.atalayamining.com (http://www.atalayamining.com)

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