Altaley Mining Corporation (TSX-V:ATLY) told investors that construction of its Tahuehueto mine in Mexico was "very near" completion, while operational improvements at its producing Campo Morado asset continues to increase revenue and reduce costs.
In a wide-ranging year-end update, the junior resource firm said it expects to enter a pre-production phase at half capacity at Tahuehueto during February 2022 when it will produce and sell gold-rich lead and zinc concentrate while declaring commercial production in the second half.
At that point, the mine will be in a continuous state of production at 80% of management's expectations.
Initial production is poised to begin using one ball mill with capacity of around 500 tonnes per day, half of the mines' planned capacity. A second ball mill will be installed during the second quarter when throughput will increase to around 1,000 tonnes per day.
Currently, consultant RDA is finalizing an independent life of mine plan (LOM) which will be incorporated into an updated pre-feasibility study (PFS) for Tahuehueto, the economic results of which are expected to be released publicly in early January this year, noted Altaley.
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Meanwhile, at Campo Morado, a five-year mine plan has been completed, which includes exploiting the El Largo, Fish, G9 and Southwest zones. Dewatering operations on the G9 and Southwest zones is nearly complete with the zone expected to be fully dewatered by the end of January this year.
Copper concentrate production is earmarked to begin during the second quarter this year, which will add another revenue stream, noted the company.
Altaley said the mine continued to perform above expectations during the fourth quarter of last year when the mine processed 183,092 tonnes of material (Q3, 2021 - 168,500 tonnes) producing 12,221 tonnes zinc concentrate (Q3, 2021 - 10,800 tonnes) and 2,767 tonnes lead concentrate (Q3 - 2,700 tonnes).
Indeed, production in the fourth quarter was the highest achieved at Campo Morado since the company acquired the mine in June 2017.
Notably, the company is also carrying out metallurgical testing in a bid to increase base metal and precious metal recoveries, including three pneumatic flotation technologies - Imhoflot, Jameson Cell and Woodgrove Direct Flotation Reactor (DFR). This work is expected to be completed near the end of the first quarter this year.
The firm will also conduct second stage testing of both the Albion and Leachox processes, both proven technologies for forced oxidation and leaching of precious metals, it highlighted.
"The ability to produce a precious metal rich pyrite concentrate, successfully obtained in recent internal laboratory testing at Campo Morado, is considered a significant and positive step towards the possibility of increasing precious metal recoveries as most of the unrecovered precious metals currently being rejected to the tailings are contained in pyrite," the company said in the statement.
Contact the writer at giles@proactiveinvestors.com