Carnavale Resources Advances Swiftsure Deposit with Mining License Application
CARNAVALE RESOURCES LIMITED (CAV) Share Update July 2024 Wednesday 31st
Carnavale Resources Submits Mining License Application for Swiftsure Deposit
Carnavale Resources Ltd (CAV) has taken a significant step forward in the development of its high-grade gold Swiftsure deposit by submitting a Mining License Application (MLA) M40/362. This move marks an important milestone in the company's Kookynie Gold Project.
Instant Summary:
- MLA M40/362 submitted for the Swiftsure deposit.
- Application compliance for MLA M40/362 is complete.
- MLA covers 355.06ha, converting portions of existing licenses.
- Initial Swiftsure MRE of 457kt @ 5.8g/t for 85koz Au.
- Pre-tax NPV of approximately A$91m with an IRR of 192%.
- Undiscounted Cashflow of approximately A$105m.
- Pre-production Capital of approximately $3m.
Mining License Application Details
Carnavale Resources Ltd (CAV) has submitted a Mining License Application (MLA) M40/362 to advance the development of the high-grade gold Swiftsure deposit within the Kookynie Gold Project. The application compliance for MLA M40/362 is now complete, covering an area of 355.06 hectares north and east of McTavish Hill, located 3km northwest of the Kookynie Townsite in Western Australia’s Eastern Goldfields.
The MLA is a conversion of portions of Prospecting Licenses 40/1380 and 40/1381 and Exploration License 40/355. This submission follows the recent release of a maiden JORC Mineral Resource Estimate (MRE) and Scoping Study for the Swiftsure deposit, which demonstrated robust financials and a competitive cost profile using conservative mining parameters and current cost assumptions.
Financial Highlights
The initial Swiftsure MRE includes 457kt @ 5.8g/t for 85koz Au, featuring a bonanza 'ounce dirt' gold zone containing approximately 53koz @ 31.2g/t Au. The resource only includes drilling at the Swiftsure deposit and remains open at depth and along strike. The pre-tax Net Present Value (NPV) is estimated at approximately A$91 million with an Internal Rate of Return (IRR) of 192% at an AU$3,500 gold price. The undiscounted cash flow is projected to be around A$105 million.
The pre-production capital required is approximately $3 million, with a maximum drawdown of about $12.9 million. The payback period for the capital is expected to be in the 14th month of operations. These financial metrics provide strong justification that the Swiftsure deposit has the potential to be a commercially viable mining operation.
Future Development Plans
Carnavale Resources plans to continue progressing the project to the next stages of development, including further exploration for additional resources and working towards achieving a permit to mine. CEO Humphrey Hale emphasized the significance of the MLA, stating, 'The MLA represents an important milestone in the development of the Kookynie Gold Project. The Swiftsure deposit is characterized by bonanza gold grades in plunging shoots. We are only just getting started here and CAV looks forward to further exploration at Swiftsure and the nearby newly discovered prospects of Tiptoe and Valiant to expand the resource base which will add value to the Swiftsure deposit.'
Additional studies will commence to progress the grant of the mining license, including flora and fauna surveys, negotiation of a Mining Agreement with representatives of the Nyalpa Pirniku people, geotechnical test work on the planned open pit and underground, and obtaining various government approvals to mine.
The submission of the Mining License Application is a critical step for Carnavale Resources, potentially leading to significant advancements in the Kookynie Gold Project. The robust financial metrics and high-grade resource estimates suggest a positive impact on the company's stock. Investors may view this as a strong indicator of future profitability and growth potential.
Investor Reaction:
Analysts are likely to react positively to the news, given the promising financial metrics and the potential for further resource expansion. The high-grade nature of the Swiftsure deposit and the strategic steps taken by Carnavale Resources to secure a mining license could bolster investor confidence.
Conclusion:
Investors should keep a close eye on Carnavale Resources as it progresses through the next stages of development for the Swiftsure deposit. The submission of the Mining License Application is a significant milestone that could lead to substantial growth and value creation. Stay informed on the latest developments and consider the potential long-term benefits of this promising project.