Altaley Mining released its 1Q21 financial results, unveiling significant operating and financial losses due to mechanical problems at the Campo Morado mine in Guerrero. Altaley said it expects better results in coming quarters because the issues have been resolved and the mine has started producing copper concentrate.
In a press release, the company announced that during 1Q22, 9,657 tons of zinc concentrate were produced at the Campo Morado mine, whereas 9,781 tons of zinc concentrate were sold, generating a revenue of US$12.34 million. In addition, 2,379 tons of lead concentrate were produced and 2,626 tons were sold, generating a revenue of US$1.84 million.
The company highlighted that despite the gains, its 1Q22 production and financial results were significantly lower than those of 2021’s quarters. Altaley explained that the lower results occured as the company lost 11 production days lost due to mechanical problems with its SAG mill’s reduction gearbox and the work required to fix the problem. Meanwhile, the company was financially affected by the subsequent increase in maintenance costs. Altaley noted that since the problem has been resolved and the company has finally started producing base metal byproducts, the coming quarters will yield stronger results.
“1Q22 was a difficult quarter at Campo Morado, where mechanical issues resulting in excessive mill downtime combined with lower recoveries, lower mill feed head grade mineralized material plus increased off taker charges all combined to substantially reduce operating profit and increase costs during the quarter,” said Ralph Shearing, CEO, Altaley Mining. “However, the mechanical issues have been resolved and the mine plan is producing increased grade mill feed with recoveries of zinc back on track. In addition, the mine started copper concentrate production during mid-May which we are expecting will add an additional revenue source to the project. We anticipate a much improved second quarter,” concluded Shearing.
Previously, Shearing explained to MBN that with Campo Morado, the company expected to transition toward become a primary precious metal producer with strong base metal byproducts. “Base metals and gold are facing an upward trend. The long-term projections for copper are fantastic. Currenlty, we are moving to an area that is richer in copper, which will make it easier to start copper concentrate production. This is a great opportunity because it will give the company another source of income. Also, it will lessen the impact when metal prices start to fall again, as we cannot expect them to be at these high levels forever,” he said.
For the next quarter, the company expects to complete its extensive metallurgical testing program. With the results, the company will have a roadmap of requirements to increase its recoveries. The company said that the speed of implementation of improvements will depend on their required costs. However, Altaley expects its enhancements to be finished in late 2022 or early 2023.