Melbourne confirmed early Friday morning Coates would need to undergo surgery just weeks out from their season opener against Parramatta, sidelining him for two months.
The injury is the same one that forced Maroons star Coates to miss last year's Ashes series in England, following Melbourne's grand-final loss to Brisbane.
"Unfortunately, he has not been able to progress as we would have hoped," Melbourne's football director Frank Ponissi said.
"With the season fast approaching, surgery has been determined as the best course of action.
"While it is disappointing for Xavier, we know he will approach the next phase of his rehab with his usual professionalism and hard work, supported by our outstanding medical and performance staff."
Lomax was the other player to pull out of Australia's Ashes squad last October, after he withdrew from the tour ahead of a planned move to R360.
Melbourne's bid to return the flyer to the NRL, after the proposed breakaway competition was postponed, now looms as crucial to their season.
The Storm remain engaged in an ugly legal stoush with Parramatta over the winger's services, with the parties due back in the NSW Supreme Court early next month.
The Eels are adamant Lomax knowingly agreed he would need their written permission to play for another NRL club before the end of 2028 when he was released last year.
Lomax argues there is a clause in that exit which says Parramatta "would not unreasonably" withhold their consent, and he should be free to join the Storm.
Melbourne have made multiple financial offers to the Eels, worth up to $300,000 to allow Lomax to sign with them, but none of the discussions have been successful.
The issue grew uglier last week when it was revealed in court documents Parramatta will claim Storm bosses then asked NRL CEO Andrew Abdo to "apply a blowtorch" to the Eels in a bid to force Lomax's move.
According to the court documents, Abdo has denied the NRL made any such commitment to the Storm.
Lomax remains unable to train with the Storm with the legal battle ongoing and is considered next to no chance to run out for Melbourne against Parramatta in round one.
Coates's injury comes after Melbourne also lost Ryan Papenhuyzen to a shock retirement last October and let Grant Anderson head to Brisbane.
Sua Faalogo is expected to win Papenhuyzen's old No.1 jersey, while Moses Leo looms as the most likely to replace Coates if the Storm can't land Lomax.
Melbourne will also be without gun second-rower Eliesa Katoa for the season following his horror head knocks while playing for Tonga.Â
Prop Nelson Asofa-Solomona was the other big name to go at the end of last season, with the 29-year-old released from the final two years of his contract.
28°C