Carnaby Resources Ltd

Greater Duchess copper project – Site visit

We attended a site visit to CNB’s Greater Duchess copper project, located 70km South East of Mt Isa.

• The Company is currently drilling with 2 rigs (diamond and an RC) which are both concurrently extending/infilling mineralisation at both Nil Desperandum and Lady Fanny and will soon test regional targets.
• The markets attention was captured by CNB back in Dec 21 after the company discovered high grade copper mineralisation at Nil Desperandum (41m at 4.4% Cu), the mineralisation has since been found to be more structurally controlled than what the market had previously assumed, although it still remains open to the south.
• We remain encouraged with the mineralisation discovered at Nil Desperandum with the company continuing to drill down plunge to the south which has already been drilled over ~200m from the discovery hole, there remains potential for more parallel high grade breccia shoots.
• Lady Fanny in our view has gone under the radar, masked by Nil Desperandum high grade discovery. The Company has discovered multiple parallel lodes over a core zone of 300m which remain open at depth and strike (22m at 1.3% Cu, northern most line). The main mineralised lode appears to average ~15m in true thickness with grades around ~1.5% Cu. Company has been challenged with difficult access to appropriate drill pads due to local topography but has recently conducted earth works to allow access.
• The company is currently undertaking IP surveys across its 5KM IOCG trend, which has found to correlate well with existing mineralisation, we are particularly looking forward to potential discovery of anomalies between Nil Desperandum and Lady Fanny, masked by shallow cover.
• Of the regional targets, the Mt Hope prospect (recent acquisition) looks the most promising in our view, extensive historical workings are present including pits over ~100m in strike, with visible copper mineralisation throughout, with no reported historical drill holes. CNB’s maiden drill program is imminent, with all approvals in place.
• We see potential for a maiden resource announcement for Nil Desperandum and Lady Fanny late CY22 / early CY23, as the company moves towards the critical mass for development studies to kick off.
• CNB remains well funded finishing the MarQ with $23m in cash.
• Euroz Hartleys has No Rating for this company. We do not provide estimates, price targets or recommendation.

3 key reasons why we continue to like CNB for copper exploration exposure:

• Numerous undrilled historical copper workings including but not limited to recent Mt Hope acquisition (almost unheard of in a well-developed mining jurisdiction like Australia).
• Proximity to processing infrastructure with spare capacity including Glencore’s concentrator 70km to the NW.
• The high grade nature of the IOCG mineralisation discovered to date proving it is a well-endowed system, many locations it remains open at depth and along strike. Supported by OZL’s investment in CNB.