29Metals (ASX:29M) today (23 February) released an increase in mineral resources with copper metal production up marginally, and zinc metal produced increased materially after mining a higher proportion of zinc ore at higher grades at Golden Grove.
The company has released its 31 December 2022 mineral resources and ore reserves estimates, reporting an increase in mineral resources of 4.5 million tonnes and ore reserves of 5.7Mt (each, after depletion for production).
Growth in resources tonnes and contained metal were in key projects. These include Esperanza South at Capricorn Copper – a 23% increase in estimated tonnes (+3.5Mt); a 32% increase in estimated contained Cu (+90,000t), a 38% increase in estimated contained Ag (+3.094 billion oz); and Cervantes at Golden Grove – a 13% increase in estimated tonnes (+600,000t) and a 34% increase in estimated contained Cu (+21,000t)
29Metals reports the strong conversion of mineral resources reflects increased geological confidence, with Measured and Indicated Resources tonnes after depletion from production increasing to 92.7Mt. This Esperanza South at Capricorn Copper – Measured and Indicated increased 51% YoY; and Cervantes at Golden Grove – Measured and Indicated increased 82% YoY.
The resources estimates reported are reported are all 2012 JORC compliant.
Meanwhile, the company today also released 2022 full year financial results. While 29Metals reports a net loss after tax of $47 million, revenue improved over the period to $721 million, with higher copper and zinc production and higher AUD metal prices.
The company also reports higher operating cash flow of $156 million and EBITDA of $152 million, which it says is ‘solid’ but is down slightly from $177 million reported in the 2021 corresponding period.
29Metals retains a strong balance sheet. It has net drawn debt of $26 million and cash and undrawn facilities of $231 million at 31 December 2022.
Commenting on the 2022 full year financial results, Managing Director and Chief Executive Officer, Peter Albert says 2022 was 29Metals’ first full calendar year as a listed company, set against a challenging backdrop.
This included COVID-19 (including increased absenteeism), very low unemployment rates and border closures in the context of an already tight labour market, and the acceleration of costs inflation, particularly in the second half.
However, Albert expects the impacts of labour absenteeism will materially abate in 2023, and the company’s focus is firmly on improving operating margins through cost and capital discipline.
“Against this backdrop, 29Metals operating results for the year were solid. As reported at the December 2022 quarter, there was a significant improvement in safety performance across the year, with TRIFR dropping below 10 on a 12-month rolling basis.
“Copper metal production was up marginally, and zinc metal produced increased materially as we mined a higher proportion of zinc ore at higher grades at Golden Grove”
Copper metal production was up marginally, and zinc metal produced increased materially as we mined a higher proportion of zinc ore at higher grades at Golden Grove. This production result was delivered after changes were implemented in our mine plans to mitigate the impact of labour shortages and lower than plan development rates.
We also made important progress on our pipeline of organic growth opportunities, prioritising the in-mine and near-mine opportunities in the portfolio – completing studies for Gossan Valley and Cervantes, with a clear plan to advance both projects in 2023, as well as achieving excellent results with the drill bit at both Golden Grove and Capricorn Copper.
Looking ahead, 2023 is a very important year for 29Metals. In our December 2022 quarterly report, we outlined the key drivers for our performance in 2023 – development rates, ventilation, regulatory approvals, costs management and capital discipline – these, along with a continuing focus on health and safety, will be the key drivers to executing our plan in 2023.”
29Metals is a copper-focused base and precious metals mining company with a portfolio of long-life producing assets and a pipeline of organic growth opportunities.
Write to Adam Orlando at Mining.com.au
Images: 29Metals Ltd
