Thank you for standing by. Welcome to the 29Metals Limited December quarter report. All participants are in a listen-only mode. There will be a presentation followed by a question and answer section. If you wish to ask a question, you will need to press the star key followed by 1 on your telephone keypad. I would now like to hand the conference over to Mr. Michael Slifirski, Group Manager, Investor Relations. Please go ahead.
Thanks very much, Winnie. Good morning, ladies and gentlemen. Mike Slifirski here. Welcome to 29Metals December quarter and full year 2022 production report conference call. The call is being recorded and will be available for replay via the 29Metals website and also accessible from the Openbriefing website. 29Metals Managing Director and CEO, Peter Albert, will commence the discussion before passing to Chief Operating Officer, Ed Cooney, who will lead through our operating performance. Ed will pass to our CFO, Peter Herbert, to discuss the financial performance before handing back to Peter Albert to facilitate Q&A. Also in the room is Mark van Heerden and Cliff Tuck, both of whom will be available during Q&A if you've got any specific questions on exploration and sustainability and ESG.
I'd now like to hand over to Peter Albert, please, to commence the discussion. Thanks, Peter.
Yeah, thanks. Thanks, Mike, and thanks for the introduction. Welcome, everybody. Thank you for joining us this morning. On today's call, we will cover 29Metals' performance for the December quarter and group guidance for 2023. You will recall we released an operational update to the market on the 21st of December, which was prior to the finalization of our December quarter results full-year outcomes. Plus, we also released preliminary guidance on the 2023 outlook. Starting with safety, a generally encouraging quarter with our TRIFR, Total Recordable Injury Frequency Rate, continuing to reduce, now sitting below 10 per million person hours worked. Our LTIFR increased as a result of 3 lost time injuries in the group for the quarter. Turning to overview of production performance, let me say how pleased we are with the performance in the December quarter.
At our last quarterly, we were on target to achieve a good finish to the year, especially in zinc from Golden Grove. In the December quarter, for the group, we produced 22,000 tons of zinc as well as 8,000 tons of copper. Golden Grove produced its highest quarterly copper equivalent production result for the year at 14,251 tons of copper equivalent. Overall, for the group, we incurred net C1 costs of AUD 66 million, down approximately 30% on the previous quarter, supported by strong by-product credits. Whilst absenteeism concerns, which were always more prevalent at GG than Golden Grove than Cap Copper, have largely abated, labor pressures remain across the industry. Nonetheless, turnover rates at both operating sites appear to be stabilizing in recent months, and we have successfully recruited a number of key roles.
The labor pressures have also put significant pressure on contractors off-site and on-site, as well as regulators in both states. In the September quarter, 2022, we signed a new 5-year contract with Barminco at Golden Grove, which commenced from the 1st of October 2022, and we're now in discussions with Barminco in relation to the contract at Capricorn Copper, which comes up for renewal this quarter. Some more details around production. As noted previously, overall production for the quarter was pleasing, enabling us to deliver against or exceed our 2022 guidance metrics. On a 2022 annual basis, 29Metals met or exceeded our guidance for all metals, i.e. copper of 40,800 tons, zinc of 57,600 tons, both within the lower half of guidance as guided earlier in the year.
Gold of 26,600 ounces and silver of 1.57 million ounces met or exceeded guidance. The strong finish to production for the year supported copper equivalent production for the quarter of 19,700 tons, with full-year copper equivalent of 73,400 tons compared to 2021 copper equivalent production of 68,200 tons. Ed will discuss production outcomes in more detail shortly. Turning to commodity prices, copper prices have been slowly but surely climbing during the last quarter, with copper rising from about $3.47 a pound to $3.80 a pound, and more recently, as high as $4.28 a pound. Zinc during the quarter was broadly flat at around $1.35 a pound but has risen in recent weeks to as high as $1.53 a pound.
Notwithstanding commodity prices recovering as many industry participants had predicted, our focus in any price environment is on delivering production and managing costs. We remain very positive about the outlook for the commodities we produce, supported by the inevitable demand requirements for copper to support the transition to a greener global economy. Turning to costs, and in relation to costs, net C1 mine operating costs have been well managed with a reduction of about 33% over the previous quarter, supported by strong by-product credits.
This is also evident in the full-year results with mine operating costs across the business of approximately AUD 75 million per quarter, yielding a competitive C1 cost of $2.46 US a pound.Capital development, sustainability projects, growth and exploration investment for the year combined at about AUD 112 million are in the middle of the guidance range, with sustainability and growth projects focused on ventilation upgrades and paste plant installation at Golden Grove. Turning to capital investment. Capital investment and sustainability and growth projects are investments in our future. A number of key projects have been advanced in the December quarter, including the paste fill plant at Golden Grove has now delivered paste to a number of underground stopes at Gossan Hill, progressively delivering paste to deeper stopes.
The chiller plant at Gossan Hill was delivered and commissioned by year-end, considerably enhancing underground operating conditions. Likewise, at Capricorn Copper, a new chiller plant facility has significantly improved operating conditions at the Mammoth Mine. A new ventilation facilities at both sites have been impacted by breakdown of equipment and commissioning challenges. We're working closely with the vendor to rectify these challenges as soon as we can, as soon as possible. The latest TSF extension at Golden Grove was completed and operational in the December quarter. The next TSF lift extension at Golden Grove was submitted for approval in the last quarter and in the December quarter, and is anticipated to be approved, with construction commencing in this quarter, March 2023.
The next TSF lift extension at Capricorn Copper was initially submitted for approval in August 2022, and is anticipated to be approved in this March quarter. New high volume evaporators were commissioned during the quarter and are now operational at Capricorn Copper. Unfortunately, there was a delay due to equipment delivery, but they're now making a significant impact on water management at Capricorn Copper. The Cervantes and Gossan Valley studies were completed, and the results released to the market during the last quarter, December quarter. In terms of financial outcomes, Peter Herbert will discuss in greater detail, but a couple of highlights. Strong revenue of close to AUD 209 million for the quarter. An unaudited net debt of AUD 32 million at year-end. Copper hedges now fully closed off with final settlement occurring early in October 2022.
29Metals paid its first dividend, an interim dividend AUD 0.02 per share, also in October. Those are the headline numbers, if you like, for the December 2022 and end of the full year. Let me turn to 2023 guidance now. Released today with the December 2022 quarterly report. In December, we released preliminary guidance for 2023 with an operations update, guidance released today adds granularity to our announcement late last year. Copper metal guidance of 36,000-43,000 tons against approximately 41,000 tons produced in 2022. Zinc metal guidance of 54,000-61,000 tons against approximately 58,000 tons produced in 2022. Gold metal guidance of 20,000-23,000 ounces against approximately 27,000 ounces produced in 2022.
Silver metal guidance of 1.15 million ounces to 1.33 million ounces against 1.57 million ounces produced in 2022. Guidance for copper and zinc reflects our expectations of the impact from reduction in milling rates at Capricorn Copper being implemented to manage tailings capacity as we continue to work through the regulatory approval process for the next planned tailing storage facility lift. The recent ventilation fan challenges at Golden Grove and previously reported shortfall in development advance, particularly during the first half of 2022 at Golden Grove. Guidance for precious metals reflects the grade profile of planned ore sources as a result of the direct and indirect impacts of COVID-19 and labor market pressures in 2021 and 2022. Zinc guidance reflects a very strong finish to the month we had in December.
Currently, 29Metals anticipates returning to normal milling rates at Capricorn Copper early in the June 2023 quarter. In respect of cost guidance, operating cost guidance at a total of AUD 643 million-AUD 740 million as compared to 2022 total OpEx of AUD 659 million. Generally higher for 2023, reflecting activity and the impacts of cost inflation continuing to be experienced in the sector. Capital cost guidance of a total of AUD 113 million-AUD 143 million, as compared to 2022 total CapEx of AUD 111 million, reflecting investment in tailings capacity and higher capitalized development.
Our capital cost guidance for 2023 includes growth capital of between AUD 20 million-AUD 25 million associated with early-stage planning works on life of mine tailing storage facilities and a portion of development capital at Xantho Extended, which will support longer term production outcomes as production ramps up from Xantho Extended. Also included in capital cost guidance is exploration costs of between AUD 9 million-AUD 14 million, including resource conversion drilling, which was previously reported to sustaining capital. I'll now hand over to Ed Cooney, the Chief Operating Officer, on production activities at the two operating mines and exploration activities for the group. Ed will then hand over to Peter Herbert to talk about financial and commercial outcomes. Thank you. Over to you please, Ed.
Thanks, Peter. Good morning, everyone. The December quarter production performance was good, with significantly higher zinc, gold, silver, and lead offset by lower copper. At Golden Grove, mining activities, volumes, and development events were all higher relative to the September quarter. Production was sourced from zinc-dominant ore sources, consistent with the mining schedule, and at quarter's end, there was approximately 70,000 tons of ROM stocks ahead of the mill, comprising predominantly copper ore. At the Xantho Extended ore body, a new service cooling plant was successfully commissioned with encouraging improvements to underground operating temperatures. Overall development advance was pleasing, with consistent capital development progress and a significant increase in lateral ore body development relative to the September quarter. Production from each of the stopes at Xantho Extended has performed in line with expectations, with good grade reconciliation and geotechnical performance.
The paste fill plant commissioning advanced with three stopes now filled higher up in the mine and a fourth stope currently being filled lower down in the mine. In parallel, underground reticulation was extended further towards the Xantho Extended ore body. In terms of the mill, throughput was significantly higher than the September quarter, reflecting higher runtime and higher throughput rates as a result of the higher proportion of primary zinc ore milled, which is typically softer than copper mineralization. Higher feed grades and lower pyrite levels in the zinc feed contributed to higher recoveries, except for copper, which was lower due to the lower copper grades in the zinc ore. Application for a further lift on TSF 3 was submitted midway through the December quarter, with an approval anticipated in the March quarter and construction to commence immediately following.
This lift is intended to provide approximately two years capacity, with engineering well progressed on a fourth and life of mine Tailings Storage Facility for Golden Grove. The application for this life of mine facility is expected to be lodged later in the September quarter. The procurement of two important new booster fans intended to increase ventilation volumes to Xantho Extended and supporting higher mining activities has been delayed. We are engaging closely with the vendor to manage this delay. Moving on to Capricorn Copper, which had a softer quarter due to lower tons milled and lower feed grades. Mining volumes were impacted by poor truck availabilities and ventilation constraints in the sublevel caving, which was driven by commissioning issues with the new surface fans.
We have since reinstated underground primary ventilation to partially restore mining activities in the sublevel caving, while the surface fan commissioning issues are resolved during the March quarter. Tons milled were lower, reflecting a planned shutdown, which was well executed. However, runtime was then impacted by a subsequent downtime to replace the trunnion bearing on the SAG mill. Feed grades and recoveries were lower due to a combination of lower grade greenstone material in the ore feed and a lower proportion of higher grade material from the sublevel caving. The approval process for the next lift of the Esperança TSF remains ongoing, with milling constraints being implemented during the March quarter as the process continues. Post-quarter end, in line with planned reduced processing in the March quarter and coinciding with heavy rainfall, the site team took the opportunity to release treated water consistent with the site's environmental permits.
Positively, three new high-efficiency evaporators were successfully commissioned in early December. These have significantly higher flow rates relative to the previously installed equipment and will contribute to reduce the volume stored water on-site. Additionally, two rental surface chiller plants were also commissioned, with encouraging improvements to underground operating temperatures at Mammoth ore body being measured. In terms of exploration, during the quarter, drill test-testing and resource conversion drilling continued at both Capricorn Copper and Golden Grove. At Golden Grove, drilling at Cervantes continued in the December quarter with a focus on upgrading the mineral resource category within the central portion of the ore body, as well as testing for potential mineralization to the north of the interpreted feeder position. Drilling is proceeding well and will continue into the March quarter.
The results of the bulk of the Cervantes drilling conducted in the December quarter is expected to be included in 29Metals updated mineral resource and ore reserves estimates, which are expected to be reported in the March quarter. Xantho Extended resource conversion and extension drilling, targeting the deepest parts of the known Xantho Extended resource, was concluded in the December quarter, and the ore body remains open down plunge, with drilling activities planned to resume early in the June quarter. Exploration activity at Capricorn Copper during the quarter also included regional drilling and ground-based geophysical surveys across multiple prospects on the exploration leases. Surface drilling at Esperanza South continued in the December quarter, targeting approximately 100 meters down plunge of the mineralized intercepts from the drilling reported previously in the September quarter.
This drilling will conclude early in the March quarter. Underground drilling was conducted across Greenstone, Mammoth and Esperanza South in the December quarter, and assay results are pending. At Red Hill, there was limited activity during the period, reflecting the seasonal nature of the exploration work in the southern part of Chile. I'll now hand over to Peter Herbert to discuss the financial outcomes of the quarter.
Thank you, Ed. Morning, everyone. 29Metals' total revenue of AUD 209 million December quarter was increased 80% on Higher unaudited revenues for the quarter reflects stronger byproduct sales compared to zinc revenues as a result of the strong production in the December quarter. This was offset by materially lower copper sales at a lower zinc price provided during the December quarter. Unaudited revenues include a net positive QPP adjustment of approximately AUD 25 million for the quarter as prices generally improved, having a positive impact on realized and unrealized portion of sales net settle. Lower copper sales during the December quarter reflects timing differences between production and sales, particularly at Golden Grove and higher zinc throughput at Golden Grove as well.
Turning to costs, group site costs were approximately AUD 15 million higher than the prior quarter, driven by higher activity levels at Golden Grove, including higher mine tons and development meters and cost escalation on certain inputs and the impact of contractual rise and fall at Capricorn Copper. Group selling costs were higher as a result of higher TCRC costs, driven by a higher proportion of zinc sales, partially offset by a slight reduction on group transport costs. Group C1 costs reduced by approximately AUD 27 quarter-on-quarter to AUD 66 million, reflecting higher by-product sales at Golden Grove. The increase in unit costs recorded in the December quarter reflects higher site costs, as discussed, partially offset by higher by-product credits and lower copper sales recorded during the quarter, particularly at Golden Grove. This resulted in December quarter C1 unit costs of AUD 2...
$2.76 per pound and $2.46 for the full year. Given sector-wide cost pressures, cost controls remain a key focus for management as we look ahead to 2023. Unaudited cash at 31 December was $172 million, down from the balance at 30 September of $181 million. This cash balance was after the payment of debt service costs, including principal amortization of $6 million. Final settlements of copper hedges and gold hedges during the quarter, totaling $2 million, and receipt of tax refunds of $18 million, and finally, payment of approximately $10 million for the 29Metals interest in advance. Following final settlement of the copper hedges, 29Metals copper production commencing in the December quarter is fully unhedged.
On a net basis, the group had unaudited net debt of AUD 32 million at the end of the quarter, being roughly in line with the result at 30 September. Post-scheduled amortization, drawn debt reduced to $138 million and 29Metals drawn down facilities will continue to amortize on a quarterly basis. Stamp duty payable in connection with the acquisition of Golden Grove remains outstanding, and 29Metals maintains an AUD 26 million provision in relation to that stamp duty. Thank you very much. Back to Peter.
Yeah, thanks, Peter. Thanks, Ed. Winnie, I think, we can go to Q&A from here, please.
Thank you. If you wish to ask a question, please press star one on your telephone and wait for your name to be announced. If you wish to cancel your request, please press star two. If you are on a speakerphone, please pick up the handset to ask your question. Your first question comes from Mr. Matt Greene from Credit Suisse. Please go ahead.
Hey, good morning, gents. Just a question on guidance to start with. The CapEx at Golden Grove. Last year, your commentary was suggesting that that was it for sort of major capital with the paste plants and the vents upgrade. Just keen to know why we're seeing CapEx, growth CapEx more than doubling into 2023.
Yeah, sure. I think the two major items in growth capital there, Matt, comprise early works on life of mine tailings facilities, a new TSF facility at Golden Grove that we believe will provide a lasting mine solution. In addition, when we look at the development meters, which we expect to improve year on year for the reasons that we discussed. You know, a portion of that capital does relate to sustaining, you know, future production beyond what we expect to achieve at Xantho Extended this year. A portion of that becomes capitalized as into the growth capital bucket.
Okay. That's helpful. Thanks. How should we be thinking about growth capital then beyond 2023 at Golden Grove? I mean, aside from, you know, advances in Golden Valley, in the current operations, anything that we should be aware of?
I think we'll have more to say on the tailings facility as we advance the works on that. The capital allocated for this year is early stage, so we don't have anything definitive to say on the longer-term outlook for that, you know, at this point in time. In terms of Xantho Extended, very much a year-to-year proposition. The only reason to allocate capital to growth out of that is if there is works to support, you know, expanding production in future years. That's not something that we expect to be, you know, every year going forward, but it is an assessment that we'll need to make at the start of each year.
Okay, thanks. I guess just keeping on Xantho Extended, how are the ventilation constraints impacting development mine grades? If you could just provide a bit more color as to what you're sort of seeing there at the moment.
Yeah, I'll take that one, Matt. In 2022, we've now extended a number of ventilation fresh air rises down to the lower operating levels. We've also, as I said, commissioned an additional surface tiller plant. Operating conditions as we currently stand are pretty reasonable, certainly a marked improvement on what they were previously.
Looking ahead, though, the two booster fans that we've mentioned, the purpose of those is to add additional volume later in the year to support, you know, even higher mining activities, truck haulage, et cetera. They're key for us to successfully be installed and commissioned to support higher mining activity levels in the latter part of the year.
Okay, that's great. We're not seeing a. I mean, you had sort of 20% behind on development last year. We're not seeing a risk of you falling further behind on your development budget?
No. No. The development activity in Q4 was good. You know, we achieved the highest, ore body lateral development that we have year to date, and that was, you know, using the current ventilation system. Those new booster fans do support, you know, higher activity levels again from what we were seeing in Q4.
Okay, that's helpful. I guess just on the medium-term profile at Golden Grove, I guess guidance this year and I guess last year was quite different to what you presented in your IPO. How should we be thinking about the zinc profile at Golden Grove into 2024 and 2025? You know, you've upgraded your reserves to the technical report, changed your stope heights and sequencing, and obviously some of the challenges around development. How should we be thinking about grade uplift, I guess, over the medium term? I mean, I appreciate you've not given any guidance, but relative to what was presented a couple of years ago, how should we be thinking about this?
Yeah, thanks, Matt. Well, today's focus really is on 2023, of course, and certainly aware of a keen interest in looking beyond 2023. We're working through that, and we'll have more to say in coming periods, coming weeks. not in a position to say too much more in this forum today.
Okay. Thanks very much, gents. That's all from me.
Thank you. Your next question comes from David Radclyffe from Global Mining Research. Please go ahead.
Hi. Good, good morning, Peter and team. My first question's on the impact on 23 numbers through the, that cumulative impact of, you know, development issues, ventilation and the tailings approved rules. How you may be changing your approach to planning in this tough environment, are you actually gonna bring forward maybe any required future projects to try and avoid similar issues? Just trying to get some color around how this is impacting on the way you plan for projects, both current and future growth ones.
Yeah, thanks. Thanks, David. Certainly, looking to bring forward or not bring forward to initiate, activate projects in a timely fashion. No question there. These impacts that we currently have in terms of approvals and ventilation, we anticipate those will be relatively short-lived. Hence, as we've indicated, an impact on the first quarter production, looking to get back into normal activities post that. I'm not looking to accelerate anything that to advance any other projects that we currently have working towards the longer-term outcome for both projects.
If you're thinking of Gossan Valley and Cervantes, for example, the plan there is, as we've indicated, certainly for Gossan Valley is to get that approval into the regulator sort of third quarter this year. Cervantes, the drilling is ongoing and the resource conversion ongoing. Both of those projects are very attractive, but, you know, they've got to go through a process to bring them to fruition. We're not changing that discipline process that we're going through at this point as we get to conclusion on both of those projects.
Okay, thanks. Just wondering if you could provide more color on the comments about pulling back on regional drilling. It seems sort of unusual at $4 a pound plus copper price. Is this just more of a, you trying to preserve some cash, or does it go to the prospectivity you see?
I think what we've. No, not to prospectivity. I mean, the regional opportunities at Capricorn are extensive and very attractive. And we will, and as you point out, copper prices are doing very well. That will generate more revenue, more cash, and we'll deploy funds appropriately. Of course, exploration is, and the opportunity at the Mount, all around the Mount Isa inlier, very attractive for us. Anticipate doing quite a bit of work there this year, subject to, of course, performance and revenue.
Okay. given how tough the environment seems to be in terms of, you know, building new projects, how much?
Corporately, do you think you'll have in 2023 to adding new projects or optionality for and growth compared to last year? Is it something that you think is more relevant this year than last?
I don't think it's any more relevant this year than last year, Dave. We're focused on bringing on those projects. In terms of the growth, organic growth projects we have, if that's where your question is focused, I mean, those are brownfields developments and certainly are very attractive in just about any scenario. We will, as I said earlier on, be bringing those along in the disciplined fashion that we have described to the market previously.
Okay, thanks. I'll pass it on.
Your next question comes from Alexander Hrushevsky with Citi. Please go ahead.
Hi, Peter and Ed. Regarding the tailings dam permitting process at Capricorn Copper, what is the likelihood of the approval timeline you've guided blowing out? Can you also provide some more color on what the long-term tailing strategy is for Capricorn Copper?
Can you just repeat the first part of the question, Peter?
What's the timing of the approval and the likelihood of it blowing out?
Okay. Thanks, Alexander. We're working very closely with the regulator and have been doing for quite some time, as you would understand. Certainly anticipate that we get that approval in this quarter. We're in preparation for that and in preparation for completing the works on that. As indicated in the quarterly report, looking to get back into normal production in the June quarter. If that were to change, we would update the market accordingly as soon as that was apparent. That's certainly our expectation right now.
In terms of longer term, we are focused on the, as I think we've indicated in here, life of mine tailings storage facility designs at both projects, and that work is advancing. Again, working with the regulator on those activities in terms of the design and then ultimately the construction and operation of the long-term tailings facilities at both sites. Both sites, of course, have got plus 10-year mine lives and we're looking at the life of mine tailings facility to support that and probably beyond that, given the resource potential of both operations.
Okay, great. Thanks. Are there any plans to look at hedging zinc prices given the recent rally?
I'll take that one. I think the position is clear. We don't look to hedge our commodity exposures selectively. You know, as we look at our financing options, we'll always review that situation. At the moment, the preference is to remain unhedged as to the fullest extent possible.
Okay, great. Thanks. I'll pass it on.
Your next question comes from Mitch Ryan from Jefferies. Please go ahead.
Good morning, Peter and team. One question from me. With regards to the new tailings facilities, obviously you're in the design phase. When do you think you'll be in a position to update the market on that?
The obviously described in this report, what we're anticipating in this quarter. Come the next quarter, we will update the market at that time with the expectation that we'll be back to operations at that point in time. If something were.
No, I'm not, I'm sorry. Sorry, to clarify, I'm not talking about your existing tailings facilities. I'm talking about the life of mine tailings...
Sorry
... facility that you're examining. Like, when will we get a capital number and a timeframe for the new tailings facilities?
Oh, absolutely. Yeah, sorry about that. I misheard you. That work is will be at the earliest later this year. We were working through those designs with our consultants, and at the earliest would be later this year, Mitch. I can't give you a precise date.
Okay. The earliest would be this calendar year and the latest would be next calendar year is?
Yes. If you wanna put a time on it.
I think, I mean, Mitch, from at Golden Grove, as we've said, the TSF force of the life of mine facility, the engineering designs for that are well progressed with submission planned in the September quarter this year. Capricorn Copper is probably, you know, the one that needs a bit more work. That's, you know, something that we can update the market later this year.
Thank you very much for the clarification. Appreciate it.
Your next question comes from Adam Baker from Macquarie. Please go ahead.
Yeah. Hey, guys. Just following up on the tailings dam at Capricorn. Just wondering with this TSF lift at Esperança, is it correct that you only get about one year's life of tailings capacity on that lift? I'm just wondering what happens after that one year. Can you do another incremental lift to get another year, or do you need to then build a brand-new facility? Just thinking if there's gonna be a gap in production towards the end of this calendar year. Thanks.
Dave, that.
Yeah. No, I can take it. The, you know, the, the longer term work that we're doing will address the second part of your query. The, the current lift, you know, will cover us for the 2023 guidance period. The life of mine work that we're doing will, the outcome of that will inform, you know, sort of future capacity, and, where that may go.
Is it possible to have a second incremental lift on top of the current one that you're trying to get through permitted now, or is that not possible? Is it maxed out at capacity?
That's one of the options that we're looking at.
Sure. Thanks. Life mine plan, appreciate that you're trying to do something there. Just wondering what that could look like with regards to timeline and also what it actually looks like. Is it likely to be two-three year guidance kind of range, or are you looking at getting a full life mine plan out for both operations?
No, as indicated earlier, Adam, we're working through that now. Focus, of course, here is on the 2023 outlook. We were looking to say something about the future in the coming periods, but we're not, we're not in a position to be doing that today.
Sure. Maybe just one final question on the labor market. How are you guys going for staffing levels on site? What's the current turnover rates like? You know, what are the key roles that you're having trouble filling at the moment?
The Ed might respond here also. As indicated in my comments earlier, Adam, our turnover rate has significantly stabilized. We're have been able to recruit most of our key roles that we were looking for, some senior appointments. The general labor pressures have persisted across the industry. We're not immune against that, so it's a very competitive environment, and we remain very focused on understanding what that environment looks like and ensuring that our recruitment, retention strategies put us in the best position. With our turnover rates stabilizing, we believe we're on the right, the right path there. It is a, it is a challenging environment. Tends to be more challenging in the west than the, than the east.
Sure. I'll pass it on. Thanks.
Your next question comes from Ben Mayne, from Jarden. Please go ahead.
Thank you. Good morning, everyone. A question for Ed, just on the broader context of Xantho Extended at Golden Grove. Just given the issues to date with development meters, Ed, if you were to broadly break the mineralization at Golden Grove into Xantho Extended and then everything else, all those other multiple ore sources, can you just maybe give us a feel for what's a sustainable number of tons that you think you can extract from Xantho Extended confidently on a sustainable basis? Thanks, mate.
Well, I, yeah, Ben. I mean, I think, you know, as we've said, going forward, the whole plan behind Xantho Extended is to, you know, increase production tons from that ore body year-on-year. You, you'll see that we are investing significantly in terms of paste fill plant, reticulation, ventilation infrastructure, fiber optic backbone, you know, all those enablers. 2023 has higher ore tons relative to 2022, and our plan is to, you know, sustainably, consistently grow that. Probably not in a position to give you a definitive, you know, number in terms of ore tons by year over time. You know, our plan is to, you know, sustainably grow that from where we currently stand and where we have been.
Thanks, Ed. I was just thinking back to the IPO documentation. Yeah, there were some tables included therein that had up to 1 million tons, essentially on a sustainable basis, call it three or four years, around about 1 million tons coming out of Xantho Extended. Yeah, is there any kind of context you can give? Like, so how much tonnage comes out of each of these 45-meter high stopes, for example? How many development meters are required if you're thinking about a 1 million ton per annum development from this singular orebody? Just, you know, any kind of broad parameters you might be able to provide around those? Or is that sort of 1 million ton rate just simply no longer relevant? Thanks, mate.
Look, I wouldn't say it's no longer relevant. I mean, you have to be mindful, Ben. That was done at a certain point in time, right? That plan. You know, we have stated that we are behind in development. The development ultimately opens up the access to mine, you know, the number of stopes required. Ultimately, once we get all the ventilation in place, the development in place, you know, that's all the enablers to increase the production rate. The 45-meter list stope will be a more productive sort of, you know, production strategy, if you like, because it's less stopes to turn over. It's that's less effort to produce, you know, the equivalent number of stopes.
All other things being equal, we should, that should help us, get to the milestones that we want to achieve.
Just so, Ed, Ben, I think, just to answer your broad question there, the target of 1 million tons is still there for the Xantho Extended. Obviously, ventilation and development and the 45-meter stopes, all that will get us along that path. To fundamentally answer the question, the target is still 1 million tons from Xantho Extended.
Okay, outstanding. Thank you very much.
The next question is a follow-up question from. Actually, there are no further questions at this time. I'll now hand back to Mr. Albert for some closing remarks. Please go ahead.
All right. Well, thanks, everybody. Thanks, Ed and Peter, for your words through the presentation. A few closing remarks. Despite the multiple external factors and challenges last year, 29Metals teams have delivered what we said we would deliver. I know that we got through the September quarter, there was some disbelief that we would deliver as much zinc as we did in the 4th quarter, that was always our plan. We had a very good finish to the year, especially at Golden Grove, our costs were pretty much in line with forecast and guidance. The challenges of COVID and absenteeism are largely behind us, although, as we discussed just now, labor market pressures continue to put pressure on the whole industry.
We're in a, you know, we find ourselves in a probably in a position better than most, fared better than most through last year. As I indicated just now to a response to a question, our targeted recruitment and retention campaign has been successful. The lack of labor in the first half of 2022 did cause us to focus activities, especially at Golden Grove, on production over development. The outcome of that is a 2023 guidance outlook, which is tempered over what it might otherwise have been.
This year, besides the operational performance, we intend to focus on aggressive cost management programs, on the Gossan Valley approval submission, which we talked about briefly, advancing resource conversion at Cervantes, which we talked about briefly, and continuing and advancing the cobalt studies at Capel and Coffee Tree, which we hadn't talked about, as well as developing those long-term tailings storage facility designs for both operations. As I've said it a number of times, we're not commodity price forecasters, but recognize that the metals that we produce are of strategic value in terms of the global decarbonization commitments. The global demand, the world will demand more material from production of the metals that we produce. Our view as miners has to be medium to long term, but also to manage for the short term.
Our long-term view is very positive about copper and other critical minerals. In the last three weeks, we've seen significant upward shifts in both copper and zinc metal prices. As approval times get longer and more difficult to secure for new operations, the value of having operating mines with brownfields organic growth opportunities becomes more and more apparent. Thanks, everybody, for listening to our presentation today.
That does conclude our conference call today. Thank you for participating. You may now disconnect.