29Metals : Quarterly Report - March 2022 Quarter

March 2022

Quarterly Report

Unit	Mar-Qtr 2021	Dec-Qtr 2021	Mar-Qtr 2022	2022 Guidance
TRIFR 1	/mmhrs	8.7	12.4	13.3	N/a
LTIFR 1	/mmhrs	0.4	0.7	1.0	N/a
Copper produced	kt	7.2	13.0	9.3	39 - 46
Zinc produced	kt	7.7	12.1	12.2	55 - 65
Gold produced	koz	5.1	8.8	5.1	27 - 34
Silver produced	koz	237.0	531.5	339.5	1,370 - 1,640
Cu-eq production 2	kt	11.6	20.3	15.8	N/a
C1 Costs	$m	73	59	67	N/a
C1 Costs	US$/lb Cu sold	3.70	1.67	2.26	N/a
AISC	$m	99	107	107	N/a
AISC	US$/lb Cu sold	5.03	3.03	3.62	N/a
Average copper price 3	US$/lb	3.88	4.40	4.55	N/a
Average exchange rate	AUD:USD	0.773	0.729	0.725	N/a
Capital 4	$m	21	37	29	97 - 129 5

29Metals Limited ('29Metals' or, the 'Company') today reported results for the March 2022 quarter.

Highlights

• ▪ Performance for the Mar-Qtr was substantially improved on the prior corresponding period, despite challenging conditions across the sector.

• ▪ During the quarter, operations were impacted by seasonal operating constraints combined with the continuing impact of tight labour market conditions and COVID-19, and supply chain delays exacerbated by extreme weather in SE Queensland.

• ▪ Copper production for the quarter was below plan and lower quarter-on-quarter, reflecting lower mined grades partly a result of operating plan adjustments to manage the impact of labour availability constraints.

• ▪ Quarterly revenue remained strong, with consistent zinc production quarter-on-quarter and continuing strong commodity prices, particularly for zinc, largely offsetting lower metal sales.

• ▪ Both operations continue to manage costs, with site costs flat quarter-on-quarter, after adjusting for higher capitalised development, despite the challenging conditions. Unit costs increased, largely as a result of lower copper metal sold.

• ▪ While capital was higher than plan, reflecting additional capitalised development (all of which reports to AISC), the increase was offset by a decrease in mining costs.

• ▪ Continued delivery of operational de-risking milestones in the quarter, including:

  • o at Golden Grove, completion of the Hougoumont-Oizon-Xantho Extended ('HOX') link, enabling a one-way traffic system in this area of the mine and extension of fresh air raises to Xantho Extended ('XE') at depth; and

  • o at Capricorn Copper, raise boring of the Esperanza South ('ESS') sub-level cave ventilation raise was completed as well as several surface water diversion projects.

• ▪ Completed the previously announced transition of Capricorn Copper processing operations and maintenance team "in- house". 29Metals also transitioned the paste plant operations team in-house at Capricorn Copper.

• ▪ Updated Mineral Resources and Ore Reserves estimates published, including a more than 100% increase in estimated contained metal at Cervantes at Golden Grove following the successful 2021 Cervantes drilling program.

• ▪ Continued investment in organic growth, including commencement of the 2022 field program at Redhill in Chile.

• ▪ Updates to guidance provided for zinc treatment charges ('TC'), and adjustments to reflect offsetting changes in capitalised development and mining costs. Production guidance range maintained subject to market and operating conditions. Refer to COVID-19 update and guidance commentary on page 3 of this report.

Summary

• 1. Shown as the 12-month moving average at the end of each Qtr. Dec-Qtr 2021 TRIFR restated following review and re-classification of an incident in November 2021 (previously, Dec-Qtr 2021 TRFIR reported as 12.1/mmhrs).

• 2. Cu-eq production for the Mar-Qtr is calculated applying average LME metal prices (Cu US$9,997/t, Zn US$3,751/t, Au US$1,878/oz, Ag US$24/oz, Pb $2,335/t (Source: FactSet)) and actual recoveries (refer to Appendix 1).

• 3. Average copper price excludes final invoice, unrealised quotational pricing adjustments ('QP') and hedging.

4. 5

Capital guidance range is the sum of updated guidance for development, sustaining, and growth capital, and Group exploration. Updated guidance range shown - refer to page 3 for guidance commentary.

Group Production (tonnes) and unit costs (US$/lb payable Cu sold)

20,333

18,236

$5.03

18,086

7,906

15,794 $3.62

7,952 6,464

9,330

Mar-Qtr 2021

Jun-Qtr 2021

Sep-Qtr 2021

Dec-Qtr 2021

Mar-Qtr 2022

Mar-Qtr 2021

$3.06

$3.03

$3.02

Jun-Qtr 2021

Sep-Qtr 2021

Dec-Qtr 2021

Mar-Qtr 2022

By-productsCopper producedCu-eq produced

AISC

C1 Costs

Mar-Qtr Group AISC build (A$ million)

160

140

120

100

80

60

40

20

-

107

Mar-Qtr- Jun-Qtr- Sep-Qtr- Dec-Qtr-2021 2021 2021 2021

Mar-Qtr Realisat'n Stockp'e By-prod's Mar-Qtr Royalties Corporate Sustain'g Cap. Dev. Mar-QtrSite Costs movem'ts C1 Costs

capex AISC

1. Site costs are the aggregate of mining, processing, and G&A expenses, and realisation costs are the aggregate of concentrate transport costs and TCRC (refer to Appendix 2).

Commenting on the Mar-Qtr, Managing Director & Chief Executive Officer, Peter Albert, said:

"Whilst our March quarter production was not quite what we had planned, given the atypical external impacts on our business I am pleased with the performance achieved by our teams, and our outlook remains positive.

A combination of factors made the Mar-Qtr challenging, notably the impact of COVID-19 absenteeism compounded with continuing labour market tightness, and supply chain disruptions. These impacts, in addition to the seasonal challenges of heat and summer rains, and extraordinary weather conditions on the east coast, impacted production adversely.

To manage COVID-19 absenteeism we made short term adjustments to operating plans to prioritise production activity where possible with available resources. This enabled 29Metals to mitigate the impact, but production performance overall was below plan while substantially above the prior corresponding period.

Our COVID-19 Management plans have been effective to-date, enabling 29Metals to limit transmission of COVID-19 on both operating sites following the first reported cases early in the quarter. COVID-19 management, and ensuring our people are physically and mentally safe on site remains a key priority.

Costs were effectively flat quarter-on-quarter, despite the above factors. Overall, the direct cost impact of COVID-19 and other external factors has been managed well to-date.

External market factors have seen increasing zinc prices as well as sustained strong copper prices, notwithstanding there has been some partial offset as a result of adjustments to zinc treatment charges.

During the quarter we published our updated Mineral Resources and Ore Reserves estimates, confirming a ten-year plus mine life at both our operating sites. The investment in 29Metals' organic growth continues, including our first field campaign at Redhill and commencement of studies examining the opportunity to bring Cervantes and Gossan Valley into the mine plan at Golden Grove.

We were also pleased to release our first Annual Report, including our Sustainability & ESG Report, subsequent to the quarter, and are looking forward to our first AGM on 24 May 2022.

COVID-19 update

As reported at the full year, 29Metals recorded its first cases of COVID-19 on-site at Capricorn Copper and Golden Grove during the quarter. 29Metals' COVID-19 Management Plans were effective in preventing significant transmission on site.

Despite successfully containing transmission on site, the continuing direct and indirect impact of COVID-19 escalated during the Mar-Qtr. In particular, the direct impact of close contact isolation requirements, which differs between States, resulted in increases in short term absenteeism. COVID-19 related absenteeism recorded for the quarter was approximately 1,200 shifts at Golden Grove and 200 shifts at Capricorn Copper, an average shift loss of approximately 6%, particularly effecting the underground workforce.

The absolute difference in lost shifts between Golden Grove and Capricorn Copper partly reflects total workforce numbers and different close contact requirements, along with the rate of community transmission, in Western Australia and Queensland (respectively).

COVID-19 related absenteeism, combined with continuing tight labour market conditions (particularly in Western Australia) required adjustments to short-term operating plans to prioritise activity with available resources, resulting in lower development advance, lower total ore movements to surface, delays to production of higher-grade material and lower diamond drill meters.

Indirect COVID-19 impacts during the Mar-Qtr included impacts on supply chains where labour availability has resulted in delays to delivery of key operating consumables. At Capricorn Copper, supply chain delays were exacerbated in the Mar-Qtr by severe weather and flooding in south-east Queensland and northern New South Wales, effecting deliveries of binding agents (i.e., cement) for paste fill operations.

The continuing direct and indirect impacts of COVID-19 (alone, and in combination with other external factors) remain volatile and difficult to predict. 29Metals will continue to manage COVID-19 related risks, including continuing enhanced communication with the workforce. The Company is closely monitoring the well-being and workload of the workforce at sites.

Guidance update1

Following the Mar-Qtr, 29Metals provides the following updated guidance for treatment and refining charges ('TCRC') and an adjustment to capitalised development and mining costs.

• ▪ TCRC: Updated for increases in TC for zinc concentrate, settled post the Mar-Qtr at US$230/t (2021: US$159/t), reflecting zinc smelter capacity constraints, and TC escalators linked to the zinc price.2

  • o Golden Grove - $68 - 85 million (original 2022 guidance: $43 - 50 million)

  • o Group - $81 - 101 million ($56 - 66 million).

  Refer to the section 'hedging and zinc concentrate offtake arrangements' for further detail.

• ▪ Capitalised development: Adjusted to reflect increased capitalised development at Golden Grove as a result of short-term changes to operating plans to manage temperature restrictions at depth and labour availability constraints, with an offsetting reduction in mining costs.

  • o Golden Grove - capitalised development is adjusted to $21 - 25 million (original 2022 guidance: $16 - 20 million), and mining costs decreased to $195 - 225 million ($200 - 230 million)

  • o Group - capitalised development and mining costs guidance is adjusted correspondingly.

29Metals maintains its full year metal production guidance range. The March quarter result, combined with the challenging conditions described in this report, has put pressure on full year metal production which is now expected to be in the lower half of the guidance range.

29Metals notes that guidance (as updated above) assumes that the direct and indirect impacts of COVID-19 and the other compounding external factors experienced in the Mar-Qtr do not continue for an extended period. In this regard, 29Metals assumes a steady reduction in COVID-19 related absenteeism following the announcement of easing of close contact restrictions in some States, and indications that others may follow, which would be anticipated to soften COVID-19 absenteeism and related indirect impacts.

1 Guidance is subject to market and operating conditions. Refer to important information regarding forward looking statements set out on page 16 of this report.

2 Refer to the Corporate section of this report for further information regarding zinc TC.

Sustainability & ESG

Corporate

• ▪ 29Metals released its first-ever Sustainability & ESG report in its 2021 Annual Report on 21 April 2022. In addition to setting out 29Metals' sustainability and ESG performance in 2021 and priorities for 2022, the report also included:

  • o the launch of 29Metals' Our Approach to Sustainability & ESG; and

  • o 29Metals' roadmap to reporting aligned to the Taskforce on Climate-related Financial Disclosures ('TCFD') recommendations.

  A standalone version of the 2021 Sustainability & ESG Report 3 is available on 29Metals' website athttps://www.29metals.com/sustainability.

• ▪ During the quarter, 29Metals implemented changes to further reflect the importance of Sustainability & ESG to 29Metals' business, including:

  • o the Board's standing Health, Safety, Environment & Community Committee was changed to the Sustainability Committee;4 and

  • o the role of Clifford Tuck (previously, General Counsel & Company Secretary) was expanded to include Sustainability & ESG. In his expanded role as Chief Governance & Legal Officer, Clifford, continuing to work closely with the other executives and the Board, has accountability for the Company's Sustainability & ESG strategy.

Group

• ▪ During the quarter, 29Metals continued its focus on health and safety with a number of additional resources deployed at each operating site to assist the site Management teams in improving safety performance, with minor and low potential injuries continuing to be reflected in higher TRIFR results for the quarter. A single lost time injury event at Golden Grove during January also contributed to a higher LTIFR for the quarter.

• ▪ The first stage of a project to align the critical risk management framework across the Group was completed. This project will be a major focus through the year. The Company is also implementing an updated integrated HSEC Management System to reinforce consistent minimum requirements across the Group. An independent audit against these Standards was completed at Capricorn Copper in March.

Golden Grove

• ▪ Flora survey documents were completed for the proposed TSF4 location, which is being progressed as part of the life-of-mine tailings management strategy.

• ▪ Yalgoo Shire acknowledged the mine's assistance with community COVID-19 testing.

• ▪ The Bayalgu Indigenous pre-employment traineeship program recommenced during the quarter, whereby 29Metals is supporting four TAFE places. The trainees participated in restoration works at the historic Muralgarra Homestead, completed during the quarter, and the installation of solar generated power for water pumping infrastructure.

Capricorn Copper

• ▪ Management of site water inventory remained a priority, with projects to reduce clean surface run-off water entering the site completed (refer to Key Projects section in this report for further information) and release of treated water under the current Environmental Protection Order ('EPO') conditions.

• ▪ During the quarter, Capricorn Copper also commenced the transition to a Progressive Rehabilitation and Closure Plan ('PRCP') under the updated scheme first announced by the Queensland Government in late 2019. Under the transition process, Capricorn Copper is required to submit its detailed PCRP schedule to the Queensland Department of Environment and Science ('DES') by 1 June 2024.

• 3 The standalone version of the 29Metals 2021 Sustainability & ESG Report includes additional GRI reporting tables.

• 4 A copy of the updated Sustainability Committee charter is available on the 29Metals website athttps://www.29metals.com/about/corporate-governance.

Golden Grove Operations

Mar-Qtr 2021	Dec-Qtr 2021	Mar-Qtr 2022	2022 Guidance
TRIFR 1	/mmhrs	8.7	11.5	14	N/a
LTIFR 1	/mmhrs	0.0	0.0	0.6	N/a
Copper produced	tonnes	2,799	5,307	4,099	15,000 - 19,000
Zinc produced	tonnes	7,720	12,126	12,235	55,000 - 65,000
Gold produced	ounces	5,093	8,795	5,055	27,000 - 34,000
Silver produced	ounces	188,214	458,925	288,335	1,050,000-1,250,000
Lead produced	tonnes	211	775	467	2,000 - 3,000
Cu-eq production 2	tonnes	7,008	12,441	10,441	N/a
C1 Costs	US$/lb Cu sold	3.84	0.60	0.93	N/a
AISC	US$/lb Cu sold	5.79	2.38	2.37	N/a

Unit

• 1. Data shown is the 12-month moving average at the end of each quarter.

• 2. Cu-eq production for the Mar-Qtr is calculated applying average LME metal prices (Cu US$9,997/t, Zn US$3,751/t, Au US$1,878/oz, Ag US$24/oz, Pb $2,335/t (Source: FactSet)) and actual recoveries (refer to Appendix 1).

Mining

Mine production was split between Gossan Hill and Scuddles, approximately 75:25 during the Mar-Qtr, with 399kt ore mined (Dec-Qtr: 384kt). Lower activity in Scuddles for the quarter was associated with planned upgrades to ventilation fans at the lower levels of the mine and priority to Gossan Hill activity levels given personnel challenges associated with COVID-19 absenteeism.

Activities for the quarter at Gossan Hill continued to focus on XE development, ventilation upgrades, and ongoing installation of the underground paste fill reticulation system. Following the first XE stope being brought into production in the Dec-Qtr, a further key milestone occurred with the breakthrough of the HOX decline enabling a one-way traffic system in this area of the mine.

XE decline advance was 143m for the Qtr (Dec-Qtr: 167m), with development resources focused on completion of the HOX link decline. Overall development activity levels were lower due to labour shortages and temperature restrictions at depth, notably at XE. Ventilation upgrade activities progressed at XE (refer to Key Projects).

Consistent delivery of cemented hydraulic fill underground was sustained through the quarter.

Mined tonnes matched milled tonnes, maintaining surface ore stockpile balances.

Processing

Ore tonnes treated of 394kt (Dec-Qtr: 365kt) was an improvement on the prior period, reflecting the constraint on mill throughput to manage the rate of tailings deposition in October and November prior to completion of Lift 5 on TSF1.

Metal production reflects the higher weighting of zinc and associated precious metals to the second half of the year.

Recoveries during March were negatively affected by failure of the zinc regrind mill. The impact on recovery is estimated to be 4% for zinc and 1% for copper while the regrind mill is down. It is anticipated the regrind mill will be back in operation during the Jun-Qtr.

Quarterly production1 (tonnes)

12,325

12,441

11,044

10,441

Mar-Qtr 2021

6,342

4,099

Jun-Qtr 2021

Copper producedSep-Qtr 2021By-products

Dec-Qtr 2021 Cu-eq producedMar-Qtr 2022

1. Cu-eq production is based on average LME metal prices for the relevant period (source: FactSet) and actual recoveries.

Costs

Site Costs of $72 million (Dec-Qtr $74 million), inclusive of COVID-19 direct costs (RAT Testing, additional nursing personnel, and other additional support staffing) and higher diesel prices but before capitalised development expenditure were marginally down on the prior quarter.