Why is the Carnaby Resources (ASX:CNB) share price melting 22% today?

Upset man in hard hat puts hand over face after Armada Metals share price sinks

The Carnaby Resources Limited (ASX: CNB) has taken a dive in early trading, amid the company announcing further drill results from its Greater Duchess Copper-Gold Project in Mt Isa, Queensland.

Assay results from a drilling regime at its Nil Desperandum prospect, located at Greater Duchess, confirms a broad high-grade copper-gold discovery at the site.

Whilst the announcement is touted as a positive by the company, the market has disagreed with its assessment.

At the time of writing, Carnaby shares have dropped 22.46% after haemorrhaging soon after the open today.

Why is the Carnaby Resources share price falling today?

The company advised of several assay results and investment highlights from the Nil Desperandum prospect in its release today.

It announced assay results from hole NLDD042 showed an intersection of 60.3m @ 0.9% copper, 0.1g/t gold from 256m and 3m @ 1.1% copper, 0.2 g/t gold from 238m.

Carnaby says the result from RC diamond hole NLDD042 confirms “the excellent continuity of the main high-grade breccia shoot directly down plunge from the previously reported drill hole NLRC017 which intersected 87m @ 0.9 % copper including 30m @ 1.8% copper” back in July 2021.

The intersection in NLDD042 is approximately 80m along strike from the recent spectacular copper results at another hole which remains “completely open down and up dip and down plunge to the southwest”.

It also notes that results from numerous other holes drilled at the end of 2021 at Nil Desperandum, Lady Fanny, and Burke & Wills prospects are also on the way.

As such, follow up exploration is being “rapidly escalated with extensive IP surveys and multiple drill rigs to commence this month”.

The company notes that extensive infill and extensional drilling is required to confirm the orientation and true width of the mineralisation intersected to date. It is also required to quantify the magnitude of the discovery, according to the announcement.

Carnaby also advised that “major new tenement applications targeting the southern continuation of a strong structural corridor to the south of Nil Desperandum” have increased landholdings by 638 km2 at Greater Duchess to 1,022 km2.

Management commentary

Speaking on the announcement, Carnaby Resources Managing Director, Rob Watkins commented:

NLDD042 has confirmed the strong continuity of the broad high-grade Nil Desperandum breccia which has been traced for over 500m and getting bigger and better at depth. We look forward to receiving more results shortly and the imminent start of 2022 exploration. We are also highly excited about the regional upside potential of the extensive new land tenure announced today.

Despite the weakness today, the Carnaby Resources share price remains one of the ASX’s top-performing names over the last 12 months.

It’s soared more than 218% in that time after rallying 326% in the past month alone.

The post Why is the Carnaby Resources (ASX:CNB) share price melting 22% today? appeared first on The Motley Fool Australia.

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The author has no positions in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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