Polymetals Faces Production and Exploration Challenges Despite Restart Success

Restarting Endeavor – A Milestone Achieved

Polymetals Resources Ltd has marked a significant operational milestone with the successful restart of its Endeavor Silver Zinc Mine in the Cobar Basin, New South Wales. After an intensive eight-month refurbishment and commissioning period, the mine has begun producing saleable silver-lead and zinc concentrates, with first revenues received in early July through pre-payment arrangements. This achievement not only signals the transition from development to production but also lays the foundation for sustained cash flow and growth.

Operational Ramp-Up and Production Outlook

The company is steadily ramping mining and processing activities toward its planned levels, aiming to process an average of 65,000 tonnes of ore per month in the second half of 2025. Despite a brief setback with a ball mill motor failure shortly after first ore treatment, swift replacement ensured minimal disruption. The processing plant is now operating smoothly, with ongoing optimization efforts focused on maximizing metal recoveries and producing consistent, premium-grade concentrates.

Polymetals plans to export zinc concentrate in 10,000 dry metric tonne parcels from Adelaide, with silver-lead concentrate shipments to follow in 5,000 tonne parcels. Notably, silver prices are at a thirteen-year high, currently exceeding US$36 per ounce, positioning the company to capitalize on favorable market conditions as it targets processing over five million ounces of contained silver over the next two years.

Exploration – Extending the Mine Life

Beyond production, Polymetals is actively pursuing near-mine and regional exploration across its extensive 1,107 square kilometre tenement package. Drilling programs at the Endeavor South and Carpark prospects have provided valuable geological insights, with encouraging signs such as alteration zones and elevated copper values hinting at potential extensions to the mineral system. Regional exploration efforts are also intensifying, leveraging decades of historic data integrated into a 3D geological model to refine target selection ahead of a substantial aircore and percussion drilling campaign.

Financial Position and Capital Strategy

On the financing front, Polymetals has adjusted its capital structure to support the production ramp-up. The company reduced its existing US$20 million debt facility with Ocean Partners to US$10 million due to security release constraints, replacing the undrawn portion with a A$15 million equity placement priced at $0.80 per share. This move strengthens working capital availability, with cash at bank reported at A$8.3 million at quarter-end, supplemented by $6 million in available finance facilities.

Development expenditure for the quarter totaled $16 million, reflecting the substantial investment in mine refurbishment and commissioning. Meanwhile, exploration and evaluation costs remained modest at $222,000, underscoring a disciplined approach to growth capital allocation.

Looking Ahead

With the Endeavor Mine now operational and early revenues flowing, Polymetals is focused on optimizing production, extending mine life through exploration success, and maintaining financial flexibility. The company’s growing workforce, nearing 200 full-time employees, reflects its commitment to building operational autonomy and long-term value creation in the prolific Cobar mineral province.