29Metals confirms additional groundworks at Xantho Extended will push back full mining resumption, leading to lowered zinc, gold, and silver production forecasts while maintaining copper output.
- Ground support upgrades on track for April 2026 completion
- Additional seismic mitigation works extend to December 2026
- Copper production guidance unchanged despite delays
- Zinc, gold, and silver production guidance significantly lowered
- Selling costs guidance reduced due to altered production mix
Mining Resumption at Xantho Extended Faces Delays Amid Seismic Risks
29Metals Limited (ASX:29M) has revealed that while ground support upgrades at its Xantho Extended orebody within the Golden Grove operation are proceeding as planned for completion in April 2026, further seismicity-related challenges have emerged. These have prompted the company to undertake additional development works aimed at reducing future production interruptions, pushing the full recommencement of mining activities to the December quarter of 2026.
The new geotechnical assessments have identified high-stress zones within the existing decline, prompting 29Metals to develop alternate level access routes. This approach aims to mitigate seismic risks that could otherwise disrupt operations. The company is also exploring options to accelerate mining in the upper sections of Xantho Extended while these works are underway, though no firm timeline has been set.
Production Guidance Revised with Focus on Copper Stability
In the interim, 29Metals will continue mining and milling alternative ore sources, ensuring copper production guidance remains intact for the full year. However, the expected output for zinc, gold, and silver has been downgraded substantially. Zinc production is now forecast between 5,000 and 25,000 tonnes, down from an earlier 40,000 to 50,000 tonnes. Gold guidance has been halved to a range of 6,000 to 14,000 ounces, while silver forecasts have dropped to 400,000 to 600,000 ounces from 600,000 to 800,000 ounces previously.
This shift in production mix has led to a reduction in selling costs guidance, now estimated between $20 million and $45 million, compared to the prior range of $50 million to $70 million. Importantly, 29Metals expects these additional works and operational adjustments to be accommodated within existing site cost and capital expenditure budgets.
Financial Resilience Amid Operational Challenges
These developments come after 29Metals reported a strong turnaround in 2025, with Golden Grove’s EBITDA jumping 76% to $178 million and a net profit after tax of $24 million, reversing a loss from the prior year. The company also recently completed a $150 million capital raise to support growth initiatives and operational resilience, including at Golden Grove. The current update on Xantho Extended underscores the ongoing operational challenges that the company is navigating to sustain production and financial performance.
Given the seismic issues and extended timeline for full mining recommencement, investors should monitor how effectively 29Metals manages these risks and whether the potential acceleration of mining in upper orebody areas materialises. The balance between maintaining copper output and managing lower zinc, gold, and silver volumes will also influence the company’s near-term revenue composition and margin profile.
Bottom Line?
29Metals faces a delicate balancing act at Xantho Extended, with seismic risks delaying full mining and reshaping production mix; copper steadies but zinc, gold, and silver cuts will test earnings.
Questions in the middle?
- Will the potential acceleration of mining in upper Xantho Extended areas offset production delays?
- How will the lowered zinc, gold, and silver output affect 29Metals’ revenue and margin in 2026?
- Can 29Metals maintain cost discipline to absorb additional works without capital overruns?