Cannindah Resources (ASX: CAE) has commenced its resource expansion drilling campaign at the Mt Cannindah copper-gold project, targeting the high-grade GAP zone with early results showing significant intersections.
The company is also preparing to drill the Southern Porphyry Cu-Au target, aiming to bolster its existing 14.5 Mt @ 1.09% CuEq Mineral Resource Estimate.
GAP Zone Expansion Drilling
Cannindah Resources has commenced drilling to expand the Cannindah Breccia Mineral Resource Estimate (MRE), specifically targeting the high-grade GAP zone.
Initial results from this zone show strong intersections, including 278m @ 1.16% CuEq from 0m at the northern end (22CAE0083).
The southern end also returned 120m @ 1.16% CuEq from 30m, which included 60m @ 1.94% CuEq from 48m (25CRC0024).
The GAP zone is defined as a 275m long section within a 600m strike length, where previous data was limited.
The current program, consisting of 12 holes totalling approximately 3000m, aims to improve the project's resource size and average grade.
An updated MRE is planned upon completion of this initial drilling program.
Southern Porphyry Target Drilling
Further exploration is on the horizon, with a second rig scheduled to commence drilling at the Southern Porphyry Cu-Au Target within approximately four weeks.
A previous intersection at the Southern Target returned 28m @ 1.15% CuEq, notably ending in mineralisation (25CRC0165), indicating potential for further discovery.
Previous quarterly reports indicated the Southern Target footprint exceeds 2000m by 800m and remains open, suggesting a substantial area for exploration.
Funding and Capital Context
To support these aggressive exploration efforts, Cannindah Resources recently completed a $15 million two-tranche placement to institutional and sophisticated investors.
The company is also targeting up to an additional $2 million from a Share Purchase Plan (SPP), aiming for approximately $16 million in cash post-settlement (before costs).
These funds are earmarked for accelerating exploration at Mt Cannindah, specifically for RC and diamond drilling, as well as general working capital.
This follows previous capital raising activities, including a $5 million placement announced in October 2024 and a fully underwritten $4.5 million rights issue announced in August 2025, as detailed in the FY2025 annual report.
The company’s ability to secure timely funding is critical to its exploration continuity.
Resource Base and Project Scale
The Mt Cannindah project currently boasts an existing MRE, updated on 3 July 2024, standing at 14.5 Mt @ 1.09% CuEq.
This significant resource contains 105,000 t of copper, 197,000 oz of gold, and 6.4 Moz of silver.
The MRE is defined to an open-pit depth of 350m, with mineralisation noted downhole to 1086m, indicating substantial depth potential.
Exploration Strategy and Outlook
Cannindah Resources’ current drilling strategy is designed to expand the existing resource base and potentially improve the average grade of the Mt Cannindah project.
This could lead to a near-term re-rating for the company, though this is contingent on factors such as metallurgy, capital expenditure, and ultimate feasibility outcomes.
The company’s FY2025 annual report highlighted an ongoing exploration focus at Mt Cannindah, with updated geological modelling continuing after the 3 July 2024 MRE upgrade.
The report also underscored the critical role of capital raising activities in funding these drilling and exploration programs.
