29Metals Limited

Thank you for standing by and welcome to the 29 Medals Limited December quarterly conference call. All participants are in a listen-only mode. There will be a presentation followed by a question and answer session. If you wish to ask a question, you will need to press the star key followed by the number 1 on your telephone keypad. I would now like to hand the conference over to Mike Sleferski. Please go ahead.

Thanks very much, Lexi. Good morning, ladies and gentlemen. We will be speaking this morning to 29 Metals December Quarterly Activities Report, which was released to the ASICs this morning. This call and parallel webcast is being recorded and will be available for replay via the 29 Metals website and the Open Briefing website. Queensland United Metals Managing Director and CEO, Peter Albert, will present an overview of the quarter, the year, and 2024 outlook before handing over to COO Ed Cooney and CFO Peter Herbert to lead you through the detail of the quarter. And then we'll open for your questions. So now I'd like to hand over to Peter Albert to commence the presentation. Thanks, Peter.

Yeah, thanks, Mike, and good morning and welcome, everybody. Thank you for joining us this morning. Today we have the chair of 29 Metals joining the meeting, Owen Hegarty. Owen's on the line. Owen, would you like to say a few words of introduction?

A couple of opening comments. Good on you, Peter. Well, thank you very much for that, and thank you to you and to Mike. I really just wanted to, Peter, take the opportunity to thank you, actually, uh, for the past, uh, several years that they've been with us, uh, here at, uh, 29 M and, and proud of that, of course, managing the assets that are now inside, uh, 29 metal. So highly appreciated, uh, you know, got us through to the point of IPO, got through the IPO, got through various other, uh, challenges there. And now the company in strong position to go forward and, and, uh, I look forward to continuing to work with you, Peter, during the next few months as we go through that transition. And as far as all that is concerned, I can report indeed that that particular executive search is on schedule, on time, on budget, on plan. So that's going pretty much according to plan. So, Peter, we deeply appreciate all of that and thought I'd take the opportunity to say that to everybody, apart from wishing everybody a happy new year for 2024. Look, as you say, Mike, looking ahead to this year, there's plenty of work about to come here, plenty of chat about the last quarter, strong quarter there. and plenty of talk about what's coming forward for this year. And we, I can assure you, are looking for, again, another strong performance, good turnaround, good improvement, and good growth during 2024. So pretty exciting. In terms of the macros out there that, you know, and I know everybody on the call here gets these things coming at them all day long. But we take a very positive approach to the outlook here. We're not unaware, of course, of some of the macro headwinds and various other geopolitical uncertainties and so on. But generally speaking, we're looking for growth. The world will continue to grow. The energy transition has left the station. and there'll be good commodities growth there for copper and zinc, and that what we called the geopolitical tension was make sure that gold and silver stay under pressure too. So we're looking forward to that. So it's an exciting year and very much looking forward to it internally and externally. And finally, I should say, Peter, and to everybody, if anybody's got any questions, queries or comments of me as the chair or any of the other directors, then as usual, please fire them through. We're open and very happy to talk to any of those particular items that you might be interested in addressing to us. So, Peter, with that, a bit of an intro ramble there. Back to you, Peter.

Yeah, thanks, Zoe. And now we'll sort of move into the presentation of the quarterly results, outcome, and the guidance for 2024. Thank you, Owen. So in this last quarter, we've made significant progress at both Golden Grove and Capricorn Copper. As always, the safety and well-being of our people is our primary focus. The total recordable injury frequency rate, TRIFA, continues to fall and is now at 6.5 for the group. although we did have two lost-time injuries during the quarter. It is worth noting that for the 12-month period, our THRIFA is down by approximately 35%, and our lost-time injury frequency rate is down approximately 25%. Really outstanding, great results and a testament to our operating team's focus on safety. During the quarter, we also implemented mental health awareness training across the company via the Black Dog Institute. We extended our mental health first aid program at Capricorn Copper and completed the new statutory supervisor training required under the WA Western Australian Mine Safety Management System at Golden Grove. Turning to production, at Golden Grove we achieved a very significant increase in metal production with nearly 21,000 tons of zinc and over 5,200 tons of copper. compared to 8,600 tons and 5,500 tons, respectively, for the prior quarter. Link production in the quarter was impacted by an overhaul on grade for a particularly high-grade stove out of three mil during the quarter. Ed will explain in more detail later on. Overall, we met copper and gold guidance for the year, but the underperformance of the one stove at Xantho Extended in December meant we missed zinc guidance by less than 5% and about 2,400 tons in gold guidance by approximately 1,000 ounces. Overall, a good production quarter from Golden Grove and especially Xantho Extended, demonstrating the high quality of this ore body and the benefit of the deep bottlenecking projects we completed during 2023. At Capricorn during the quarter, sorry, Golden Grove during the quarter, we made the submission to the regulator for the next tailings facility at Golden Grove called TSF4. And subject to regulatory approval, we plan to have this facility in operation in the first half of 2025. At Capricorn Copper, the focus remained on recovery with significant reduction of onsite water and continued production from the mammoth and greenstone ore bodies. A tailings thickener shaft failure in November impacted planned copper production, although continued improvement in copper production was achieved with 2,400 tons produced. The thickener was repaired and came back online earlier in January. The most significant outcome for Kevrigan Copper during the quarter was the Queensland Government's declaration of prescribed project status as well as critical infrastructure project. This provides the Office of the Coordinator General, as called the OCG, the powers to facilitate timely decision-making for key approvals. An extremely strong show of support for the full recovery of operations and the long-term future of the site. Another significant achievement at Capricorn has been the re-entry into Esperanza South, a sub-level cave which was flooded in the extreme weather event last March. To date, we have removed approximately 160 megalitres of water from the cave and rehabilitated the first upper levels of the mine. Consistent with our expectations, inspections of the upper levels indicate the fibercrete is largely undamaged, with bolts requiring replacement. During the quarter, we also made a revised application to increase the holding capacity of the Esperanza pit, called the E-pit, and resume tailings deposition the EPIT noting we have previously put tailings into that facility. A number of discussions have been held with the Department of Environment Science and Innovation called DESE as well as the OCG and other government departments in respect to this application and we anticipate an outcome in this current quarter. As most on this call would know, securing our ability to resume depositing tailings into the EPIT is our pathway to continuous operations as we complete the design, approval, and construction of the long-term tailings facility at Capricorn, TSF3. And we expect to submit the application for TSF3 in the near future. As has been previously advised, a refusal of the application, if that were to happen, to redeposit tailings into EPIT would result in Capricorn copper being put into care and maintenance for a period until TSF3 was constructed. As it noted, it is previously working very closely with the government departments to secure the approval to be able to put tailings into the EPIT. Costs across the group were well controlled in the quarter, despite materially higher activity and higher production. In the face of continuing inflationary and labor pressures, overall costs for the group were within or below guidance, and we estimate that the cost-out and productivity initiatives across the business achieved approximately $20 million of savings, and this focus will have renewed effort in 2024. Unaudited cash at 31st of December was $162 million, and Peter Herbert will talk to financial outcomes shortly. On the exploration front, the first of the two holes to be drilled at Capricorn Copper across the little fault at Mammoth encountered poor ground and was pulled up a little short, although the approximate 500-meter drill that was drilled did result in some good and encouraging geological outcomes. The second hole drilling has commenced. And at Golden Grove, the Cervantes program has concluded and the results are being incorporated into the resource and reserve estimation, which is due for publication by the end of February. The insurance claim for Capricorn Copper recovery remains in progress, and we will advise outcomes as they are realized. Now turning to guidance, 2024 guidance. 2024 guidance is released today with the December 23 quarterly report. Given the current uncertainty around Capricorn copper, we're not providing full-year guidance for Capricorn at this stage. Golden Grove year-on-year improvement for all metals reflects an increased production from Xantho Extended. Copper metal guidance is 18,000 to 22,000 tonnes against approximately 18,000 tonnes produced in 2023. Zinc metal guidance 54,000 tons to 61,000 tons against approximately 51,500 tons produced in 2023. Gold metal guidance of 17,000 ounces to 25,000 ounces against approximately 14,000 produced in 2023. And silver metal guidance of 700,000 ounces to a million ounces against 775,000 ounces produced in 2023. And in respect of cost guidance for Golden Grove, increases in guidance for mining and processing costs, which combined is $320 to $365 million, as compared to 23 outcomes of $306 million. This increase due to increased activity and continuing inflationary pressures. An increase in TCRC guidance of $68 million to $78 million compared to $51 million in 23, reflecting a production profile, changes to benchmark terms, and zinc concentrator TC escalators. And an allocation of $7 to $8 million at corporate cost to the site, previously reported as centralized cost. This allocation principally relates to Golden Grove's share of group insurance and labor costs incurred to directly support operations. The combined sustaining development and growth capital guidance is $59 to $75 million compared to $50 million in 2023, with the growth capital comprising TSF4 construction and a proportion, or a portion rather, of Xantho extended development capital. For the group, expiration guidance between $4 to $7 million is to support the planned drilling east of the mammoth ore body at Capricorn and continued resource conversion drilling at Golden Grove. Corporate cost guidance at $21 to $23 million is after the allocation of some group costs to operations as previously noted for Golden Grove. So now I will hand over to Ed Cooney to talk in more detail about our operations, and then he will hand over to Peter Herbert to talk in more detail about financial outcomes. Over to you, please, Ed.

Thanks, Peter. Good morning, everyone. Well, they're responding to our safety metrics and outcomes for the quarter. So I might begin with progress against our recovery plan at Capricorn Copper. A relatively dry November and December period has enabled further water reduction during the quarter, with Mill Creek Dam being in compliance in terms of water storage volume at the prescribed date of 1 November, representing a vertical drop of approximately two metres. Dewatering waves from the underground at Esperanza South progressively increased during the quarter, with the North Cave now fully dewatered. and the decline which transitions from the north to the south cave currently undergoing final dewatering and ground support rehabilitation has finished. Larger capacity submersible pumps are onsite awaiting completion of planned dewatering holes which once installed will further increase underground dewatering rates from the south cave. In the absence of re-close During the December quarter, there was no opportunity for treated water release. However, with recent rainfall in the creek catchment, controlled releases have since commenced from the flooded workshop area. Overall, notwithstanding recent rainfall, the input of South water from underground into the pit The expanded evaporation system, limited freshwater take from the lake, plus the release of water to the creek have largely maintained the reduced Mill Creek Dam water level and an approximate three metre vertical reduction in water in the Esperanza pit. In terms of production activities, while the December quarter saw an improvement on the September period of all mined, milled, feed grades and copper production, Failure of the tailing stick in a shaft exacerbated water quality issues being managed in the settlement ponds. This had a direct impact on mining and process plant runtime, negatively affecting copper production outcomes in late November and December. The shaft was replaced ahead of the planned commencement of January's milling campaign. Nonetheless, copper production for the quarter at about 2.4 kilotons was a significant improvement on the prior quarter. Looking ahead, progress continues to be made on a number of key capital projects with a focus on design and onsite survey activities for a new long-term tailing storage facility. Completion of these works will lead to the application submission for this facility expected in the near future. Design of a replacement water treatment plant has progressed from concept level to the detail stage. As Peter mentioned, we submitted a revised application for an amendment to the design storage allowance within Esperanza Pit and approval to resume deposition of tailings for an interim period until the new tailings facility is approved and constructed. With existing remaining tailings capacity in the Esperanza TSF until the end of April, We continue to work closely with various government departments to enable sustained production outcomes, including a return to full operations with Esperanza South coming back online in the second quarter. Moving on to Golden Grove, mining plans were marginally lower than the prior quarter due to a greater proportion of ore trucked from depths that Xantho extended, while mill tons were consistent with the prior quarter. During the year, a number of de-bottlenecking activities were undertaken, including commissioning of the new ventilation circuit, introduction of auto-mine, and the commissioning of a new underground fuel bay. And despite the ventilation fans encountering multiple commissioning problems, mining activity, as measured by both development and production, increased at Zanto extended quarter on quarter. And for the full year, tons mined from Zanto extended increased to approximately 330 tons which was a significant lift from the 180,000 tonnes mined in 22. In terms of full-year metal production, copper performed well and was in line with guidance. However, as Peter mentioned, we fell short on zinc. The site team put in a tremendous effort to successfully mine and mill the planned ore sources required. However, expected zinc grade from one of the plant high grain sources underperformed, resulting in a circa 2.5 thousand tonne shortfall in zinc production. The zinc grade underperformance was primarily due to additional chalcopyrite within a broad zinc ore zone not previously identified at the current 20 metre drill spacing. And the net result was greater copper produced from the stope, but less zinc. We do retain a very high level of confidence in the geological resource models, with overall zinc reconciliation at Xantho Extended within 3% of the model estimates to date. Development performance at Xantho Extended continued to improve during the December quarter with another record achievement set, and the site team remain absolutely focused on further ongoing improvements in this area, which is a key driver of future production growth from the ore body. Peter mentioned the 24 guidance ranges earlier for Golden Grove. We anticipate additional volumes through the process plant this year as we benefit from no mill throughput curtailment as we experienced in the first quarter of 2023, partly offset by an additional planned millery line. Increases to production across all metals is expected as we deliver further year-on-year improvements to production rates from Xantho Extended. zinc guidance in particular reflects the mining schedule updated for closing phase positions at the end of 2023 with a significant improvement in development performance at xantho extended in the second half of 23 only partly offsetting early under performance earlier in the year in terms of approvals activity an important application for the site's new tailings facility was submitted in the december quarter and a subsequent information request response has been provided in January. Procurement of associated long-lead items and the design is currently progressing to plan. Additionally, we anticipate submitting our application for Gossam Valley approval later in the March quarter. I'll now hand over to Peter Herbert to discuss financial outcomes of the quarter.

Thanks, Ed, and thanks, everyone, for joining us. I'll start with revenue outcomes for the December quarter. Our relative revenue of $141 million and an increase of approximately $40 million in the price for a result. Golden Grove achieved higher copper sales despite flat metal production quarter on quarter reflecting the timing of shipments and lower zinc sales despite an interior increase in zinc metal production as concentrate volumes on hand increased consistent with production outcomes weighted to period end. Capricorn Copper achieved an increase in copper sales of more than $20 million in the quarter, affecting the round-up in production activity. Copper's percentage of total revenue for the quarter was approximately 70%, an increase in the price for the quarter of 58%. This increase reflects higher copper sales for gold in the program in the quarter, and a continued round-up of operations in Capricorn Copper. Realising modernity prices were broadly flat in AUD terms, the prevailing thinking gold prices in USD terms slightly, while copper was slightly softer, and the Australian dollar was largely flat as well. Looking ahead to 2024, Golden Grove production sales outcomes are expected to be slightly weighted to the setting up, and at Capricorn and Copper, we expect March performance to be broadly consistent with the December quarter, albeit absent the impact of the ramp-up challenges that Peter and Ed spoke to earlier. Turning now to costs, at Golden Grove, site costs for the for the second quarter of 91 million were higher than the prior quarter result of 81 million. Reflecting increased activity, contractor rates were down 50% increase in concentrate volumes produced during the quarter. Selling costs comprising TCRC and transport costs were more than aligned with the prior period despite an increase in concentrate volume sold, which was a greater ranking to common concentrates during the quarter. And capital in the December quarter continued to track into the bottom edge of guidance For the year, total capital of $50 million was below the bottom end of guidance, being $68 million, reflecting lower than expected TSF procurement commitments, decisions to defer non-essential capital, and lower rates of development advance during the year. At Gaffer Corn Cover, site costs increased to $31 million from $19 million in the prior quarter, reflecting ramp-up in activity during the period, all being still below the March quarter run rates given the ongoing suspension of Esperanza South and the impact of the ramp-up issues. B1 and AISC unit costs for the quarter declined 14% and 18% respectively. However, it will remain elevated ahead of the resale of Exbrane South. Recovery costs for the December quarter were $16 million and included costs associated with the commencement of ESSD watering. For the full year, recovery costs of $61 million was below the bottom end of guidance of $70 million. Efforts to identify cost-saving opportunities, primarily in Golden Grove in 2023, and increase in production at both sites, have delivered reduced unit costs in the December quarter. The identification of cost and efficiency opportunities has been encouraging, and there is a focus on extending these efforts into 2024, with improvements in unit costs to come from resolving ground-sunk issues and executing our plans to deliver higher production in 2024, particularly the consumption of mining and drilling for S-Grams of Salad, Working with our teams and business partners to identify and extract further operational efficiencies, and delivering further opportunities to streamline and simplify our business. Gretel & Mendel finished the quarter with unemployment cash of $162 million, a decrease on the September quarter position of $227 million. The movement in cash reflects the timing of sale at Golden Grove and the build-up of concentration retreats, as mentioned earlier. The impact of the round-up issues are capital and copper. producing production by approximately 1,000 tonnes of copper, which has since been resolved. The timing of the corporate costs, including the payment of insurance premiums, and further tend to involve principal repayment and interest costs during the quarter. No proceeds from 29L's ongoing insurance claim were received during the quarter. However, progress continues to be made on the surface-composed claim for property damage from business interruption. The group had unaltered net drawn debt of $52 million at the end of the quarter, an increase on the unaltered net debt position at the time of $15 million. After principal repayments, gross drawn debt declined US$146 million at year-end. Printed-out metals continued to evaluate opportunities to enhance access to liquidity. During and post-reporter, discussions on a potential offtake facility were advanced. Finally, 29 Metals has been in communication with the WA Office of State Revenue and based on its correspondence, expected to finalise the standards you can pay in connection with the acquisition of Golden Grove during the first half of 2024. 29 Metals maintains a $20 million to $60 million provision in relation to the statute. Thank you everyone for listening. I'll now hand back to Peter Udman.

Peter Udman Thanks Peter and thanks Ed. Lexi, we could now move to any questions at this point in time. Thank you.

Thank you. If you wish to ask a question, please press star 1 on your telephone and wait for your name to be announced. If you wish to cancel your request, please press star 2. If you're on speakerphone, please pick up the handset to ask your question. Your first question comes from Kate McCutcheon from Citi. Please go ahead.

Good morning, Peter, and best wishes for 2024. The comments in the quarterly on insurance, what does making progress mean exactly? What is still in the works there? Any colour you can divide in terms of scope versus what you thought it might be and timing around that?

Thanks, Kate. Always a challenging question and understandably asking the question. discussions with insurance ongoing, positively ongoing. I think in the quarterly, we reflect on the indemnity provided by the insurance in respect of the surface property and related BI. So that's advancing and moving ahead. And as noted in our discussions earlier, As we get to resolve those outcomes, we'll certainly keep the market well informed. And once we get through that, that's the time to engage more significantly with the insurers in relation to the underground markets. uh component of the insurance so working working process i i can't really uh advise any more kate not that there's any more to advise except the work and the process is ongoing and and has advanced and we're actively engaged with the insurers okay got it thank you and then golden grove guidance on zinc seems to be a bit lower than the five-year outlook you previously provided

Is there anything to call out there? And just a related part of the question, after spending on capital, even if I strip out the growth at Golden Grove, it's been some time since that asset generated free cash. From the comments, it seems like you're looking at it closely as a business in terms of what you can do to bring costs down. But what are the key levers there? I guess the question is you want to be mining for cash. So what are the things that you're looking at there?

Do you want to talk to the Tums, Ed?

Yeah, I'll tackle that one, Kate. I mean, principally, it's due to closing base positions at year end. If you recall, we did have a number of delays somewhat frustratingly with the booster fans that Zanto extended. Obviously, they're now resolved and additional improvement projects such as fuel bays, et cetera, completed, which sets us up well, having said that, you know, the improvement that we saw later in the year wasn't enough to offset the shortfall early in the year, which effectively means that I guess the total ore tonnes from Zanzo Extended are planned for next year slightly lower than where we had previously guided.

Okay, got it.

Yeah, and Kate, this is Peter Herbert here. I'd like to talk about the cost question that you raised. Great question. As you'd expect, there's no single silver bullet with these things. We're focused primarily on driving vehicles, increased efficiencies across the site. And Ed talked to things like building a fuel by underground to improve efficiencies out of that fleet. And this really is something that we're engaged very closely with our partners, you know, including groups like Burn Cut to help us achieve those efficiencies, you know, looking at the teams, how they're structured and set up to drive greater output underground. You know, equally at Capricorn Copper, you know, we have experience with ramp-up issues in the December quarter and we would hope that those are now resolved and that we can write a brand new plan on that side in March for all.

Okay, yeah, I guess my question was around the ability for Golden Grove to generate free cash and the outlook there. I know it's not a specific question, but just that asset hasn't been making that, so looking forward, that would be good to see.

Absolutely, I can assure you we're very much focused on that as well, Kate.

Okay, thank you.

Yeah, just to add to that, Kate, I did make reference in my comments to the savings achieved in 2023 with a backdrop of the not insignificant inflationary pressures and labor pressures. And a lot of focus on contractor management and efficiencies across the business and very significant input right across, mostly Golden Grove, of course, because Capricorn and Copper were in a different status last year. but significant achievements there with that backdrop. And as I noted earlier, that process is accelerating and advancing and will be a renewed and continued focus this year to look for those opportunities. Certainly aware of the concerns there, and we're focused on making that operation as efficient as we possibly can.

Okay. Thank you, Peter. Thank you. Your next question comes from Tim Hoff from Canaccord. Please go ahead.

Thanks very much, guys. First off, congrats, Peter, on your retirement. All the best for the future. Thanks, Peter. I was just looking at page two and just having a look at Xantho extended your ramp-up rate there. All mines is 140,000 tonnes, close to sort of a steady run rate there, or is there more sprint capacity?

Yeah, so that reflects a good increase quarter on quarter. I mean, as we've mentioned, you know, development rates impacted earlier in the year by ventilation, which effectively did mean that we were constraining mining activity in terms of limiting truck movements and the like. So for the year, we achieved about 330,000 tonnes out of Xanto extended. Ultimately, you know, where we want to get to is sort of around the million-tonne mark. So even on the December quarter, we expect there will be further increases over time as we bring online or open up more development sub-levels and produce from a higher number of stoves from that ore body. So continual improvement over the coming years, even from the December quarter, right?

Thank you. Ed, I don't think we can understate the benefit of the ventilation system, which certainly we experienced some significant problems right up to the point of getting them commissioned and back into operation from about well, sometime in the third quarter, and you see the improvement from there. So, you know, they're now up and running and providing the appropriate ventilation as well as the other projects that Ed referred to in terms of the fuel bay and the auto mine system, which again was a project for last year. So those activities will lead to continuous and continued improvement as Antho extended, and as Ed said, the target there is to get to a million tonnes per annum there. A bit of a repeat there, Ken, and thank you for your comment earlier in respect of myself. Thank you.

And then perhaps finally, TCRCs, regarding to an up year, year-on-year, just noting that in our screens with TCs falling this year on the standards and escalated, can you just step through that and how that functions for us?

Yeah, sure. So a bit of a mixed bag there for the TCRCs The higher senior production forecast year-on-year is obviously part of it. The escalators linked to the senior price under those existing off-take agreements are a key driver there. This year will be the year where that impacts the most based on the schedule of escalators that were placed under those agreements. So next year we would expect an improvement relative to this year, all things being equal in terms of price and production. But yeah, that's the key driver for TCRCs this year.

Any high copper stoves you can take instead?

Sorry, I didn't catch that.

Apologies. Sorry, I was going to say, any high copper stoves you can take this year instead of the high zinc?

Well, I think we're always looking to optimize that profile, of course, but yeah, we'll always evaluate that as we go forward. No worries. Thanks very much, guys. I'll hand it over.

Thank you. Once again, if you wish to ask a question, please press star 1 on your telephone and wait for your name to be announced. Your next question comes from Rahul Ayanand from Morgan Stanley. Please go ahead.

Hi, Tim. Thanks for the call. Happy New Year. First one's just a follow-up from Tim's question. I just wanted to press a bit more on the TCRC side of things. So firstly, can you update us in terms of what your base rate to the zinc treatment charges are and where does the additional TC kick in in terms of price and also the length of the contract? I remember seeing an announcement a while back which talked about midpoints of the contracts. This is obviously a high year as we were talking on the previous question, but I just wanted to understand what those numbers were, first of all. And then just following on from Tim's question as well, are there any volumes involved here or is it simply a year-on-year contract whereby if you produce less zinc this year, then you essentially pay lower TCRC in dollar million terms over the life of contract? That's the first question, thanks.

Yeah, sure. So in 24 and 25, there is 100,000 tons in each of those years remaining under these contracts. They aren't willing to come and buy this. Once they're delivered into, then that obligation is completed. And the details are in the guidance section, just for your reference on page 11, but the base escalator is 230 for those 100,000 tonnes, and the escalator kicks in at a price of $2,050 per tonne. So that's US, I should say. So the details are there, and it covers 200,000. And next year, the average price will increase again relative to this year.

So then after the 100,000 tonnes, that's it, we go back to a normalised TCRC contract, is that right?

The balance, yeah, that's right.

OK, brilliant. OK, that's very clear. Thanks for that. And then the second question is around Golden Grove in terms of your Stope reconciliation. Just wanted to understand the size of the problem, so to speak, if you want to call it a problem. Obviously, you talked about having a bit more copper than zinc, but what's the delta in terms of the reconciliation here? Are there any concerns in terms of going forward that we should have in terms of that good reconciliation that you've had in the past changing to perhaps a bit more strenuous relationship with that reconciliation? Thanks.

We've mined 10 stoves, Rahul, from Xanthox standard. The model reconciles within 3% for zinc in the aggregate. Obviously there's some pluses and minuses. That particular stove where we had a 2,500-tonne shortfall was about a 20% delta to the negative. We've had a look at this year's stoves. We don't anticipate issues of that nature recurring this year. Having said that, you know, it is an estimate. It is based on 20-metre drill spacings. You know, it's a rigorous process signed off by a competent person. We do have it reviewed by external third parties at that certain interval, so we do have good confidence in the estimates. Having said that, you know, we will take another look at potentially some of the drill spacings in certain areas of the ore body, as we would from time to time. as we do resource estimate updates. In short, not concerned. Yes, it did catch us out and it was a specific high-grade source at the end of the year, so the timing was difficult, but still I have good confidence in the models.

Okay, and then just perhaps the final one around Xantho Extended Steel. How does the ore sequencing look now going forward into the next couple of years, perhaps, proportionally? How much are you expecting out of Xanthar Extended? And I'm just trying to get an understanding of how that impacts grade and how we can think about cash flow generation at the asset. Thanks.

Yeah, so, I mean, the work we've done to inform the guidance, you know, looked at year-end face positions and the detailed plan for 2024, not beyond. In terms of what we released previously, if I'm not mistaken, the midpoint of Xantho extended production was, you know, sort of circa 650,000 tonnes in 2024. We're probably targeting about 100,000 tonnes in the plan below that for this year.

Got it. OK, that's all from me. Thank you. I'll pass it on.

Thank you. Your next question comes from David Radcliffe from Global Mining Research. Please go ahead.

David, we can't hear you. David?

Oh, sorry. Hopefully you can hear me now. Apologies for that. Sorry, Peter. No worries. Question just coming back to Capricorn. I just really want to clarify the timing here for a tailing solution. I think previously you'd mentioned maybe that there was a six-week lead time following any approval to being able to stack, and whether you've been able to do any work there or not. And if I'm reading that right, does that mean we're really sitting here with only a couple of weeks of potential time before there is a, if there's no approval, there would be an interruption?

uh not not why so we have previously deposited tailings into the esperanza pit it's relatively close to the process plant relatively straightforward you know infrastructure in terms of a single deposition tailings pipe so any lead time to enable that to recommence actually relatively short so that six week time frame you mentioned they're not quite correct for the esperanza pit um Yeah, so we'd be able to turn that on reasonably quickly.

Okay. And is there any, I mean, obviously you've got special status there. You've had that for, I guess, a couple of months. Are you actually seeing that that's actually achieving anything? Or I think previously you've talked about it seems to be quite a slow process with the Queensland government. Has anything actually changed after getting the special status?

Well, thanks, David. The special status which we got, I think it was November eventually, was a very rapid outcome, very great support from a number of government entities in terms of turning that around extremely quickly. So very positive from that perspective. There was no requirement for that, anything to be enacted from that outcome until we went through the process of the NAS approval submission, so it was not accepted to maintain and keep the relevant departments informed and involved, but no specific activities required. Obviously, now that we've made the application, we're in that process, the level of information, the level of discussions increases and we're in that stage at this point in time to ensure that we get the right support at the right time from the right government bureaucracies and OCG, the Office of Coordinated General, will and is leading that effort. So I think your question sort of suggested that It may have implied that there was nothing happening there, but it's all happening in the background. But certainly in the early days, nothing required to happen, David.

Oh, no, no, that's helpful. I mean, it's obviously hard for us from the outside looking in to get a picture of whether things have sort of improved on the permanent side or not. So that's where the question was going. But thank you for that. I'll pass it on.

Thanks, David.

Thank you. There are no further questions at this time. I'll now hand the conference back to Mr. Albert for closing remarks.

All right. Thanks, Lexi, and thanks, everybody, for today, and thank you for all the good questions coming through. We here at 29Metal significantly encouraged by the 2023 quarter four achievements at both Capricorn and Golden Grove. And as the chair said earlier on, sort of setting ourselves up, we consider for a successful 2024. Throughout the challenges of 23, our team has stayed focused, committed, and we achieved most of the goals we set after the extreme weather event occurred at Capricorn in March last year. The teams at both sites continue to address any challenges we face professionally, focusing on safety, great safety performance, as I referred up front in my discussions, and whilst overcoming the issues that we have confronted in as rapid time as possible. As I said earlier, now looking forward to building on the end of our positive 23-year outcomes as we move into 2024. Thanks, everybody, again, for attending today. As the Chair said earlier on, I'm always here to receive any follow-up on any questions that you may not have had addressed today. Please send them through. Mike would be your first port of call, but we're always here ready to respond. Thanks again. Have a good day.

Thank you. That does conclude our conference for today. Thank you for participating. You may now disconnect.