Why fundie John Forwood likes Carnavale’s high-grade WA gold story
Carnavale has flown under the radar, but resources expert John Forwood says the junior goldie makes the grade when it comes to WA gold.
Carnavale Resources took an important step towards the development of its Kookynie gold project on Monday, completing a one-for-15 share consolidation
Its backers include significant shareholder the Lowell Resources Fund, whose CIO John Forwood likes the junior's high grades and experienced team
Capital hurdle for near-term production expected to be low, with BFS on the way in 2026
After years setting the scene for a high-grade WA gold development, Carnavale Resources (ASX:CAV) has entered a new stage in its evolution, with a share consolidation laying a foundation for a pivotal 2026.
The owner of the Kookynie gold project has taken an important step to improve its liquidity, completing the one-for-15 consolidation on Monday, boosting its share price to 8.7c.
It comes at a critical time for the gold junior, which is sitting on a deposit that feels perfectly designed for this day and age.
And the roughly $35 million capped company has significant backers who believe in its story and make it one to watch.
The most prominent of those is John Forwood's Lowell Resources Fund (ASX:LRT), which picked up its stake some time ago and continued to hold 5.7% of the company as of late November.
Lowell chief investment officer Forwood told Stockhead Carnavale's Swiftsure and Tiptoe deposits between Menzies and Leonora in WA's famous Eastern Goldfields were at the centre of the listed investment company's thesis around the stock.
A 2025 scoping study suggested a mine operating at modest scale over five years would produce 93,000oz at 3.1g/t gold, achieving payback in 14 months and spitting out $237m of free cash at a gold price of A$5500/oz.
Even before the obvious upside – gold prices are now ~A$1000/oz higher – the crown jewel is the high-grade 'bonanza zone' of the Swiftsure deposit, with 60,000t containing 28.3g/t Au for 55,000oz, the ultimate high-grade sweetener.
With ore like that, any number of plants within a 200km radius – there's at least seven that fit the bill – could be well-placed to treat Carnavale's ore.
Forwood recently returned from Canada where some companies are, anecdotally, trucking 9g/t dirt as far as 900km as gold prices above US$4000/oz have blown the barriers to becoming a producer to the ground.
With that in mind, Carnavale's high-grade zone would be profitable milled just about anywhere in southern WA.
"The headline is it's just beautiful, high-grade, near-surface, pretty rare these days to find something (like Swiftsure)," he said.
"Some of those high grades are open-pittable. They're planning an open pit going into an underground.
"That ore can pretty much go anywhere, to any plant in WA in terms of trucking distance and still make a very handsome margin. So the world's your oyster."
Experienced team
The other standout factor for the small cap goldie is the experienced team it has running the show.
Humphrey Hale, the initial managing director at tungsten developer Wolf Minerals and one time exploration manager at the major Sunrise Dam gold mine in WA for AngloGold Ashanti, entered the fray as CEO in May 2021.
Long-time board member Andy Beckwith, known for his role in De Grey Mining's Hemi discovery, became chairman this year with fellow De Grey alum Allan Kneeshaw having long been a consulting geologist.
That sort of credibility goes a long way with investors who have been around the block like Forwood.
The combination of those names makes the board and management a collection of "steady hands" Forwood says, with the Kookynie project also sitting in prime real estate.
On top of that, the small but high-grade nature of the Swiftsure and Tiptoe deposits at Kookynie means a future development won't break the bank.
"They can get that largely funded by some sort of arrangement with a contract miner largely or something like that," Forwood said.
"So the capital hurdle is so low for these guys to make you know $200m-plus of cash flow.
"It's very achievable as opposed to say a low-grade project with hundreds of millions of tonnes which is going to take hundreds of millions of dollars to get into production.
"This can be quick and cheap."
Kookynie gold
Kookynie is, famously, a one horse town.
Literally, the tiny community's claim to fame was a former racehorse which had taken up residence in its middle-0f-nowhere pub.
But Carnavale isn't the only game in town.
A number of larger capped companies have ground nearby like Genesis Minerals (ASX:GMD), Gorilla Gold Mines (ASX:GG8), Ora Banda (ASX:OBM) and Ballard Mining (ASX:BM1), while fellow junior explorer Arika Resources (ASX:ARI) operates in the vicinity.
Its ground includes the Cosmopolitan mine, which produced 360,000oz at 15g/t from 1895-1922, then one of the largest and most profitable gold mines in WA.
Forwood says he's sure there's more deposits like Carnavale's Swiftsure and Tiptoe hiding in the underexplored area.
Carnavale has identified targets at Valiant, McTavish North and Champion South, with a host of other prospects across its tenement package.
A BFS is intended for completion to have the Swiftsure and Tiptoe deposits shovel-ready for open pit mining and toll treating by the second half of 2026.
Key steps will include the execution of a mining heritage agreement, a prelude to the grant of a mining lease, along with technical studies, discussions on third party mining and milling options, exploration and funding options for the development of the mine.
Carnavale shares closed trade on Monday at 8.7c, up 74% in the past year.
At Stockhead, we tell it like it is. While Carnavale Resources is a Stockhead advertiser, it did not sponsor this article.
