29Metals Cuts Copper Costs to US$1.82/lb, Advances Gossan Valley Project

Operational Highlights and Resource Expansion

29Metals Limited has reported a strong December Quarter 2024, underscored by encouraging exploration results and operational efficiencies. Notably, high-grade copper intercepts at the Europa project have extended mineralisation approximately 100 metres below previous estimates, reinforcing Europa's potential as a significant ore source within the Golden Grove complex. These results, including intercepts such as 43.9m at 3.0% copper, highlight the ongoing success of the company’s exploration strategy.

Complementing this, the company has made a final investment decision on the Gossan Valley project, aiming to optimise and extend the life-of-mine at Golden Grove. The feasibility study projects a seven-year mine life with an average annual production of 4,000 tonnes of copper and 20,000 tonnes of zinc, supported by a $110 million net present value at a 9% discount rate. This development is expected to provide production flexibility and replace declining ore sources, positioning Golden Grove for sustained output.

Production and Cost Performance

Golden Grove’s operational metrics for the quarter reflect solid performance improvements. Copper production rose to 5.3 kilotonnes, up from 4.4 kilotonnes in the prior quarter, with a milled grade of 1.6% and recovery rates improving to 87.5%. Zinc production remained robust at 17.6 kilotonnes. Cost efficiencies were evident, with C1 cash costs declining to US$1.82 per pound of copper sold and all-in sustaining costs (AISC) improving slightly to US$3.32 per pound, driven by favourable stockpile movements and by-product credits.

Capital expenditure included $34 million in capitalised development, sustaining, and growth capital, notably supporting the Tailings Storage Facility 4 (TSF 4) project, which remains on track for completion in the March quarter of 2025. This new facility is expected to lower unit production costs and provide a long-term tailings solution for Golden Grove.

Capricorn Copper: Environmental and Operational Progress

At Capricorn Copper, the company has made strides in addressing environmental compliance and water management challenges following the March 2023 extreme weather event. An Environmental Enforcement Order has been received, lifting restrictions on treated water releases for the 2024/2025 wet season. The site achieved a significant water inventory reduction of approximately 200 megalitres during the quarter, including 72 megalitres of treated water released.

The interim water treatment plant has been debottlenecked to increase capacity from 10ML/day to 16.5ML/day, with further optimisations planned. While detailed design for a replacement water treatment plant is materially complete, construction works remain on hold to conserve cash pending progress on restart imperatives. The company continues to assess tailings storage options to ensure long-term operational sustainability.

Financial Strengthening through Refinancing and Equity Raising

Financially, 29Metals has fortified its balance sheet with a senior debt refinancing that reduces debt levels by US$18 million, extends maturities, and simplifies the debt structure by combining revolving credit and term loans. This refinancing reduces scheduled repayments by US$74 million over the next two years, easing near-term cash flow pressures.

Additionally, a fully underwritten $180 million equity raising was completed, boosting the company’s liquidity to $268 million as of 31 December 2024, up from $104 million in the prior quarter. Golden Grove generated operating cash flows of $48 million and free cash flows of $18 million during the quarter, underpinning the company’s capacity to fund ongoing development and operational priorities.

Outlook and Strategic Priorities

Looking ahead, 29Metals is focused on advancing productivity and cost improvements at Golden Grove, progressing the Gossan Valley project development, and preparing for a sustainable restart of Capricorn Copper. The company anticipates a reduction in cash outflows in 2025 as environmental compliance projects conclude and operating costs stabilise at lower activity levels. Strategic options to accelerate Capricorn Copper’s restart will be evaluated throughout the year, contingent on water management progress and regulatory approvals.

Overall, 29Metals’ December quarter results reflect a company unlocking value through disciplined operational execution, strategic capital management, and promising exploration outcomes that collectively position it well for future growth in the copper sector.