PERTH (miningweekly.com) – Embattled iron-ore miner Atlas Iron on Friday announced that mining operations at its Abydos and Wodgina mines would continue during May, as the miner was able to reduce cash costs at the operations.

Atlas in April announced plans to progressively suspend mining at all its Pilbara operations during the month, with iron-ore exports to cease shortly after, as iron-ore prices continued to tumble.

However, the miner said on Friday that following negotiations with some of the company’s key service providers, cash costs for the Abydos and Wodgina mines had been substantially reduced for the month of May. As a result, mining would continue at Abydos during the month, with processing and haulage largely uninterrupted as Atlas depleted previously mined stockpiles. Mining would also restart at Wodgina as soon as possible during May, with processing and haulage restarting shortly thereafter.

The iron-ore miner reported that the decision to continue operating was also taken in light of the successful production and sale of first lump cargo from the Abydos mine in March. Up to 65% of Abydos’s production would be in the lump product category, which was priced at a premium to Atlas’s standard fines project.

The company noted that the new operating model, inclusive of lump product streams and assistance provided by key service providers, combined with positive pricing momentum, meant that Atlas expected to be cash-flow positive in May.

The miner said that it would continue work to define contractual arrangements with key contractors in an effort to convert these initiatives into viable longer-term operating solutions as soon as possible.

Options for the Mt Webber mine were still being assessed, Atlas added.

During the three months ending March, Atlas shipped some 3.4-million tonnes of product, down from the 3.8-million tonnes shipped during the previous quarter, at an average realised price of A$59.55/t in the month of sale.