Funding and Approvals: The Next Challenges for Carnavale’s Kookynie Gold

Project Overview and Economic Upside

Carnavale Resources Limited has released an updated Scoping Study for its Kookynie Gold Project, located near Leonora in Western Australia. The study highlights a significant uplift in project value, effectively doubling the valuation compared to the previous assessment. This improvement is underpinned by a robust economic profile, with free cash flow increasing by 126% to approximately A$237 million and a pre-tax Net Present Value (NPV) of A$188 million calculated at an 8% discount rate.

Mining Strategy and Production Targets

The study proposes a mining strategy that begins with two open pits; Swiftsure and Tiptoe; before transitioning to an underground operation beneath the Swiftsure pit. This integrated approach is designed to maximize resource extraction and economic returns. The production target is approximately 970,000 tonnes of ore at an average grade of 3.1 grams per tonne gold, yielding an estimated 93,000 ounces of recovered gold over a five-year mine life. Notably, the plan includes a high-grade bonanza zone within the Swiftsure pit, featuring 60,000 tonnes at 28.3 g/t for 55,000 ounces.

Capital and Operating Costs

The project’s capital requirements are modest, with pre-production capital expenditure estimated at around A$3 million and a maximum capital drawdown of approximately A$21 million during operations. Operating costs are competitive, with a total operating cost of about A$2,466 per ounce recovered, excluding capital expenditure. The study assumes contract mining and toll treatment at third-party processing facilities within trucking distance, which simplifies operational logistics and reduces upfront infrastructure investment.

Resource Classification and Technical Confidence

The resource model supporting the study includes 84% of mineral resources classified as Indicated within the pit, providing a solid foundation for economic evaluation. The study incorporates detailed open pit and underground mine designs, schedules, and financial evaluations prepared by independent consultants Cube Consulting Pty Ltd. While the results are encouraging, Carnavale cautions that the Scoping Study has an accuracy range of +/-35% and includes Inferred Resources, which carry inherent uncertainties.

Next Steps and Regulatory Progress

Following the positive outcome of the Scoping Study, Carnavale plans to advance the Kookynie Gold Project through a Feasibility Study to further refine economic and technical parameters. The company is also finalizing mining lease and heritage agreements, including with the traditional owners, which are expected to be granted during the Feasibility Study phase. These steps will be critical in de-risking the project and positioning it for development.