Shares in ASX copper company Carnaby Resources Ltd (ASX: CNB) hit a fresh 12-month high after the company announced it had made a significant discovery during recent drilling.
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Mining project likely to expand
The company said in a statement to the ASX that it had struck a copper grade of 7.1% copper equivalent over a 19m intersection during drilling at the Trek 1 Footwall Lode.
The company said the new drilling confirmed the discovery of a significant new deposit, adding to drilling results first reported late last year, with the new lode also open down plunge and along strike to the north.
Carnaby Managing Director Rob Watkins said of the discovery:
These fantastic results from the new Trek 1 Footwall Lode discovery have completely opened up the Trek 1 deposit beneath the Ore Reserve pit design. We are looking at a completely new mineralised structure that links off the Main Lode in a more favourable northerly strike and may indeed be the primary driver of the Trek 1 deposit. The Footwall Lode has only been intersected in a handful of holes to date. In addition to the 400m extension discovery of the Main Lode, the Trek 1 Footwall Lode discovery is outside of the existing Mineral Resource.
Mr Watkins said the company would incorporate the new results from the main and footwall lodes into an updated mineral resource estimate and also perform open-pit optimisations and underground scoping studies in the second half of the year.
He said Carnaby remains on track to complete the feasibility study for the project by mid-year, prior to a final investment decision, and was targeting first ore production in the second half of the year from the Greater Duchess project.
The company said there was scope for the size of the open pit at Trek 1 to increase in size, given the new drilling results.
The new drilling was part of an overall 3000m drilling campaign.
Positive study already released
Carnaby released a pre-feasibility study for the project in March, envisaging a mine which would operate for 12 years with a payback period of just 13 months.
The mine was expected to produce a total of 165,000 tonnes of copper equivalent.
Carnaby shares traded as high as 65 cents on the news on Thursday morning before settling back to be 10.9% higher at 61 cents.
The 65-cent mark is a new 12-month high, with the company's shares having traded as low as 27 cents over the past year.
Carnaby Resources is valued at $151.9 million.
