Carnavale Resources Advances Kookynie Gold Project BFS Drilling Programme

Carnavale Resources Launches BFS Drilling at High-Grade Kookynie Gold Project

Carnavale Resources (ASX: CAV) has commenced its highly anticipated Bankable Feasibility Study (BFS) drilling programme at the Kookynie Gold Project, marking a critical milestone toward bringing this 116,912-ounce gold deposit into production. Located in Western Australia's prolific Eastern Goldfields, the project represents a rare high-grade opportunity with significant potential to deliver strong returns for investors.

The comprehensive drilling campaign launched this week includes 9,000 metres of infill resource drilling, metallurgical testing, and geotechnical assessment across the Swiftsure and Tiptoe open pits. With the BFS expected to be finalised in Q3 2026, Carnavale is positioning itself to deliver a "shovel ready" mining scenario that could transform the company's prospects.

Multi-Phase BFS Drilling Programme Underway

The Kookynie Gold Project drilling program by Carnavale Resources Ltd represents one of the most comprehensive feasibility assessments undertaken in the region this year. Furthermore, Carnavale has deployed Terra Drilling's diamond rig for the initial phase, with two additional RC rigs joining the programme in the coming weeks.

The comprehensive drilling campaign encompasses several critical components that will drive the project's development forward:

Metallurgical & Geotechnical Assessment

• 6 diamond drill holes to recover 150kg of core for detailed metallurgical testwork
• 8 geotechnical diamond holes to optimise slope assumptions for both open pits
• Samples will inform gold recovery rates across oxide, fresh, and transitional material

Resource Definition Drilling

• 9,000 metres of infill RC drilling on a 10m x 10m pattern
• Designed to convert indicated resources to measured category
• Will provide grade control data to reduce operational risks during payback period

Water Management Assessment

• Surface hydrogeological surveys already well advanced
• 7 water bores planned for March 2026 (3 production, 1 monitoring, plus dewatering bores)
• LIDAR survey completed to establish accurate surface drainage patterns

"Carnavale has been busy during January in preparation for the extensive drilling campaigns that have kicked off at the Kookynie Gold Project this week… This enables Carnavale to fast-track the BFS and bring the KGP to a shovel ready project by Q3 this year. Carnavale is well funded to complete all of this planned work." – Humphrey Hale, CEO

Understanding Bankable Feasibility Studies: The Gold Standard for Mining Projects

A Bankable Feasibility Study (BFS) represents the most comprehensive technical and economic evaluation of a mining project. In addition, it provides the detailed analysis required for major financing and development decisions.

Unlike preliminary studies, a BFS delivers investment-grade certainty that financial institutions and major investors require before committing capital to mining developments.

Critical BFS Components

The study process involves multiple technical disciplines working in parallel to establish project parameters:

Resource Confidence: Converting indicated resources to measured category reduces geological risk by providing detailed understanding of ore continuity, grade distribution, and mining characteristics. This conversion typically requires drilling on closer spacing to demonstrate continuity between drill holes.

Processing Parameters: Detailed metallurgical testing establishes gold recovery rates across different ore types and processing costs. This testwork determines whether conventional processing methods are suitable or if specialised techniques are required, directly impacting project economics.

Infrastructure Requirements: Geotechnical studies optimise pit designs by determining safe slope angles for open pit walls and ramps. Better understanding of rock strength characteristics can potentially steepen pit slopes, reducing the amount of waste rock that must be removed to access ore.

Economic Viability: Comprehensive financial modelling incorporating all technical studies enables accurate assessment of project returns and supports project financing discussions with banks and investors.

For investors, a completed BFS represents a critical de-risking milestone that often triggers significant value re-rating as projects transition from exploration to development-ready status.

Strategic Location Delivers Competitive Advantages

The Kookynie Gold Project's location 60km south of Leonora and 180km north of Kalgoorlie positions it strategically within Western Australia's established gold mining region. Moreover, this proximity to existing infrastructure and operating mines provides several competitive advantages that enhance project economics:

The project's high-grade nature further enhances its attractiveness, with the resource estimate showing an average grade of 4.3 g/t gold across the combined 842,307 tonnes. This is significantly above typical industry averages of 1-2 g/t for open pit gold operations.

The regional infrastructure advantage cannot be understated. The Eastern Goldfields region hosts numerous operating gold mines and processing facilities, creating established supply chains, contractor networks, and regulatory frameworks. Consequently, this reduces development risks and costs compared to greenfield locations.

Resource Quality Sets Foundation for Strong Economics

The Kookynie Gold Project drilling program by Carnavale Resources Ltd has established a mineral resource that demonstrates quality characteristics underpinning the current BFS programme:

The substantial 77,193 ounces in the indicated category provides a strong foundation for the initial mining scenario. Meanwhile, the 39,719 ounces of inferred resources offer significant upside potential through conversion and expansion drilling.

The indicated resource forms the basis for mine planning and economic modelling in the BFS, as this category provides sufficient confidence for detailed planning purposes.

Open Pit vs Underground Potential

The resource breakdown by mining method reveals the project's development flexibility and potential for staged development:

• Open Pit Resources: 52,467 ounces at 4.05 g/t (above 320mRL)
• Underground Resources: 64,445 ounces at 4.57 g/t (below 320mRL)

This configuration supports Carnavale's strategy of initial open pit development followed by potential underground expansion. Furthermore, this approach maximises project value over an extended mine life.

The higher-grade underground component provides significant optionality for future development phases once initial open pit operations establish cash flow and operational experience.

The elevation split at 320 metres above sea level represents the practical depth limit for open pit mining. Below this level, underground methods become more economical.

BFS Timeline Positions Company for 2026 Development Decision

The Kookynie Gold Project drilling program by Carnavale Resources Ltd follows an accelerated timeline that reflects extensive preparation work completed during December and January 2026. This preparation included heritage surveys with the Nyalpa Pirniku people through cooperation with WTAC, and programme of works approvals for all planned drilling activities.

The heritage surveys represent a critical milestone, as indigenous heritage clearances are mandatory for mining activities in Western Australia. Completing these surveys early in the process demonstrates proactive project management and removes a potential constraint on development timelines.

Water bore drilling planned for March 2026 will provide critical data for mine dewatering requirements and water balance planning. Understanding groundwater conditions is essential for open pit development, as water inflows can significantly impact mining costs and methods.

Technical Programme Details Drive Investment Confidence

The current drilling programme encompasses multiple technical disciplines working in parallel to optimise project parameters. Metallurgical drilling aims to recover 150kg of core samples across different ore types to establish gold recovery characteristics through detailed crushing and grinding testwork.

Geotechnical drilling focuses on understanding rock strength characteristics around the proposed pit walls. This information could potentially enable steeper pit slope angles, reducing the strip ratio (waste rock to ore ratio) and improving project economics.

However, even small improvements in slope angles can significantly impact the amount of waste rock requiring removal.

The 9,000-metre infill drilling programme on a 10m x 10m pattern aims to convert indicated resources to measured category. This closer-spaced drilling provides greater confidence in ore continuity and grade distribution, reducing operational risks during the critical early years of mining.

SRK Consulting (Australasia) Ltd has been engaged to evaluate waste rock characteristics for environmental approvals and waste dump designs. This work ensures compliance with environmental regulations and optimises waste disposal methods to minimise long-term environmental liabilities.

Why Should Investors Follow Carnavale Resources?

The commencement of the Kookynie Gold Project drilling program by Carnavale Resources Ltd represents a transformational period with multiple catalysts positioned to drive value creation through 2026:

Near-Term Catalysts

1. Metallurgical results from diamond drilling programme (Q2 2026)
2. Resource upgrade from infill drilling programme (Q2-Q3 2026)
3. BFS completion delivering economic parameters (Q3 2026)
4. Development decision and financing pathway (H2 2026)

Competitive Positioning

• High-grade resource significantly above industry averages
• Strategic location in established mining region
• "Shovel ready" timeline for rapid development
• Well-funded for completion of all planned work

Growth Potential

The Swiftsure and Tiptoe deposits remain open for expansion, with additional targets identified across the broader tenement package. Successful BFS completion could unlock significant exploration upside while establishing cash flow from initial mining operations.

The project's location within the Eastern Goldfields provides access to established infrastructure and processing facilities. Consequently, this reduces development capital requirements compared to remote projects.

This infrastructure advantage, combined with the high-grade nature of the resource, creates a compelling value proposition for investors seeking exposure to near-term gold production.

Regional exploration potential adds further upside, as the tenement package covers prospective geology beyond the current resource areas. For instance, the combination of immediate development opportunity and longer-term exploration potential provides multiple avenues for value creation.

Carnavale Resources has positioned itself at a critical inflection point, with the BFS drilling programme representing the final technical milestone before development. The combination of high-grade resources, strategic location, and accelerated timeline creates a compelling investment proposition for investors seeking exposure to Western Australia's gold sector. With multiple value catalysts expected through 2026, CAV deserves close attention as it advances toward production.

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