"The start of 2022 has been one of the most challenging periods experienced by the Company since the re-start of Proyecto Riotinto," Atalaya's CEO Alberto Lavandeira said.
Atalaya declared commercial production at the operation in February 2016.
"The extremely high electricity price, due to the record natural gas price in Europe, has also created inflationary pressures that have only been partially offset by the higher copper prices and favourable exchange rates," he said.
In January, the company warned that should the volatility and high energy prices in Europe persist, it could impact its operating budget - and potentially production.
The 2022 cash cost range had been set at US$2.25-$2.80 per pound, while all-in sustaining costs were pegged at $2.50-$3.05/lb.
Further details on the costs are to be provided in the company's Q1 financial statements, which are set for release in May.
"Measures have been taken by the company and the Spanish government and we are confident that the situation will improve in the coming months," Lavandera said.
He said Atalaya remained committed to developing its pipeline of growth projects.
The company's copper production for Q1 stood at 11,249 tonnes, which was down 20% year-on-year and 22% weaker than in Q4 2021. Guidance has been maintained at 54,000-56,000t.
The transport sector strike did interrupt processing operations, but the company used the downtime to bring forward maintenance work that was originally planned for Q2.
Atalaya's share price on the Toronto Stock Exchange was quoted as C$6.55 (US$5.22) on April 13, which gave the company a market capitalisation of C$916 million.