Carnaby (ASX:CNB) scopes compelling copper-gold for new Mt Isa production

Carnaby Resources’ scoping study over Greater Duchess has shown an economic pathway to either third-party production or a standalone operation from its collection of copper-gold discoveries in Queensland’s Mt Isa Inlier.

The $35 million of pre-production capital required for partner processing at Greater Duchess Copper Gold Project is dwarfed by the $174m required for going solo and is a greater gap than between the $715m to $824m of respective pre-tax undiscounted net cash flow.

Carnaby sees the third-party option as the more compelling, assuming competitive agreements with that party, but believes the standalone option presents a viable alternative to be assessed in parallel.

Carnaby Managing Director Rob Watkins said the Greater Duchess study was a major milestone for the company and its shareholders and was the culmination of extensive work undertaken since the copper-gold discovery was first marked in late 2021.

“The scoping study results highlight a robust new mine development project located close to existing infrastructure and processing facilities in the Mount Isa region,” Watkins said.

Watkins flagged the company was confident Greater Duchess had a clear pathway to a low-capex operation set for first production in the December 2026 half-year to capitalise on rapidly rising commodity prices.

“We expect the mineral resource and production targets will continue to grow over the course of the next few years,” he said.

“Given the extensions of the mineralisation that have been intersected outside of the current mineral resource, such as 87 metres at 2.3 per cent copper (and) 0.5 grams per tonne gold at Mount Hope Central and the broader exploration upside that exists on our tenements in the region.”

And while solo development holds the higher total production numbers, the Perth-based developer noted the figures were a good proxy for what a third-party production target would be if it adjusted cut-off grades to match larger price assumptions used for the financial model.

Both open pit and underground optimisation designs were completed using a $12,000 per tonne copper price and $2950 an ounce for gold.

The financials were completed using higher assumptions of $15,000 and $3500 respectively, but those figures are still less than current trading prices of $15,563 and $3533.

Carnaby also has a pre-feasibility level metallurgy campaign underway, working alongside Glencore (LON:GLEN) operators at Mt Isa Copper Concentrator and its ball mills to assess treating ore from Greater Duchess.

The production hopeful considered the initial metallurgy results from the Mt Hope deposit as exceptional and has discussions underway with Mt Isa’s departing major over processing and offtake deals.

There remain other options for treating in the long-productive copper region, and either way, Carnaby has taken another stride towards production from a trio of high-profile discoveries at Greater Duchess — Mount Hope, Nil Desperandum, and Lady Fanny.

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