Carnaby Resources : Quarterly Activities/Appendix 5B Cash Flow Report

December 2021 Quarterly Report

The Board of Carnaby Resources Limited (Carnaby or the Company) is pleased onlyto provide the following quarterly update and Appendix 5B.

December 2021 Quarterly Highlights:

GREATER DUCHESS COPPER-GOLD PROJECT - MOUNT ISA, QUEENSLAND ▪ Nil Desperandum Prospect

• Assay results confirmed an extremely high-gradecopper-gold discovery at Nil Desperandum. Results include:

use	o	NLDD044	41m @ 4.1% copper, 0.5 g/t gold from 247m
		including	24m @ 6.5% copper, 0.7 g/t gold from 251m
		including	9m @ 10.3% copper, 1.2 g/t gold from 264m
	• The high-grade		copper intersection in NLDD044 remains
personal	completely open at depth and along strike to the southwest where
further IP surveys are underway and drilling is to commence shortly.
Lady Fanny Prospect
▪
	• First known drilling ever conducted at Lady Fanny has outlined a
	broad shallow high-gradecopper-gold deposit. Results include:
	o	LFRC009		27m @ 2.8% Cu, 0.8 g/t Au from 61m
		Including		9m @ 4.0% Cu, 0.3 g/t Au from 65m
		And Including	11m @ 3.3% Cu, 1.6 g/t Au from 77m
	o	LFRC013		20m @ 2.3% Cu, 0.5 g/t Au from 30m
		Including		6m @ 5.5% Cu, 1.4 g/t Au from 38m
	o	LFRC012		17m @ 2.1% Cu, 0.9 g/t Au from 74m
		Including		7m @ 4.2% Cu, 2.0 g/t Au from 77m
STRELLEY GOLD PROJECT - Mallina Basin, Pilbara, WESTERN AUSTRALIA
▪	Alcazar Prospect
For	• Encouraging gold mineralisation has been intersected in composite
drill results over consecutive 160m spaced drill sections and
remains open:
o	PLRC0112		20m @ 0.45 g/t gold from 105m
		Including		5m @ 1.52 g/t gold from 110m
	o	PLRC0114		5m @ 1.82 g/t gold from 160m

• Big Hill Prospect
• • A large 1.5 km by 0.5 km lithium soil anomaly associated with a discrete magnetic high unit on the Berghaus Shear Zone was defined, with first pass drill testing planned.

Cash as at 31 December 2021 increased to $5.8M (See corporate section)

ASX Announcement 19 January 2022

Fast Facts

Shares on Issue 125.2M

Market Cap (@ $1.75) $219M

Cash $5.8M1

1As of 31 December 2021

Board and Management

Peter Bowler, Non-Exec Chairman

Rob Watkins, Managing Director

Greg Barrett, Non-Exec Director &

Company Secretary

Paul Payne, Non-Exec Director

Company Highlights

• Proven and highly credentialed management team
• Tight capital structure and strong cash position
• Greater Duchess Copper-Gold Project, numerous camp scale IOCG deposits over 1,022 km2 of tenure
• Nil Desperandum copper-gold discovery drill out commencing
• Projects near to De Grey's Hemi gold discovery on 442 km2 of highly prospective tenure
• 100% ownership of the Tick Hill Gold
  Project (granted ML's) in Qld, historically one of Australia highest grade and most profitable gold mines

Registered Office

78 Churchill Avenue Subiaco Western Australia 6008

1. [phone] www.carnabyresources.com.au

For personal use only

GREATER DUCHESS COPPER-GOLD PROJECT (CARNABY 82.5 -100%)

Drill results released during and subsequent to the quarter end unveiled two outstanding new copper-gold discoveries at the Nil Desperandum and Lady Fanny Prospects within the Greater Duchess Copper-Gold Project. These results demonstrate the potential of the rapidly emerging >5 km long major Iron Oxide Copper-Gold (IOCG) corridor at Greater Duchess.

New tenement applications were lodged, which target the southern continuation of a strong structural corridor south of Nil Desperandum and have increased landholdings by 638 km2 at Greater Duchess to 1,022 km2 (Figure 1).

Figure 1. Greater Duchess Copper-Gold Project Location Plan.

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NIL DESPERANDUM PROSPECT (CARNABY 82.5%)

Assay results received from RC and diamond drilling conducted during the period at Nil Desperandum revealed a major copper-gold discovery at the prospect (See ASX Release 29 December 2021). NLDD044, planned to test the NLIP4 Induced Polarisation (IP) chargeability inversion anomaly for the first time (Figure 2), yielded a spectacular high-gradecopper-gold intersection with results of:

• 41m @ 4.1% copper, 0.5 g/t gold from 247m

1. Incl. 24m @ 6.5% copper, 0.7g/t gold from 251m o Incl. 9m @ 10.3% copper, 1.2g/t gold from 264m

The high-grade copper intersection in NLDD044 remains completely open at depth and along strike to the southwest where the plunge of the mineralisation appears to be flattening.

Figure 2. Drill Section showing NLDD044 and the NLIP4 IP chargeability anomaly.

Subsequent to the quarter end, the Company also announced strong drill results from NLDD042 of (see ASX Release 10 January 2022):

• 60.3m @ 0.9% copper, 0.1 g/t gold from 256m
• 3m @ 1.1% copper, 0.2 g/t gold from 238m

Importantly the result from NLDD042 confirms the excellent continuity of the main high-grade breccia shoot, being approximately 60m directly down plunge from the previously reported drill hole NLRC017 (Figure 3), which intersected 87m @ 0.9 % copper including 30m @ 1.8% copper (see ASX release 5 July 2021).

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Importantly, NLDD042 also lies approximately 80m north of the spectacular drill result in NLDD044 (Figure 3). Further drilling is required to confirm the continuity between these holes and to test for further extensions of high-grade mineralisation which remains open up and down dip and down plunge. As such, extensive new IP geophysical surveys have commenced targeting extensions of the NLIP4 IP anomaly to the southwest of NLDD044, where no previous IP surveys or drilling have been completed. Multiple drill rigs have been contracted, with one RC/DD rig commencing at the end of this week and a second rig to commence in early February 2022.

Figure 3. Nil Desperandum Plan Showing Prospects and drilling.

LADY FANNY PROSPECT (CARNABY 100%)

Stunning assay results from the first five holes drilled at Lady Fanny were announced subsequent to the quarter end, outlining a broad shallow high-gradecopper-gold deposit (see ASX Release 13 January 2022). Significant results are:

• LFRC009	27m @ 2.8% Cu, 0.8 g/t Au from 61m
Including	9m @ 4.0% Cu, 0.3 g/t Au from 65m
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	And Including	11m @ 3.3% Cu, 1.6 g/t Au from 77m
•	LFRC013	20m @ 2.3% Cu, 0.5 g/t Au from 30m
	Including	6m @ 5.5% Cu, 1.4 g/t Au from 38m
•	LFRC012	17m @ 2.1% Cu, 0.9 g/t Au from 74m
	Including	7m @ 4.2% Cu, 2.0 g/t Au from 77m

Figure 4. Lady Fanny and Burke and Wills Prospect Plan showing new drill results.

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