Challenger Exploration reveals updated high-grade resource at Hualilan on the back of ‘outstanding’ drill results

Following more “outstanding” drill results, Challenger Exploration (ASX: CEL) has revealed an upgraded high-grade resource for its flagship Hualilan project in Argentina, which managing director Kris Knauer says is now enough to support development.

The new resource has increased from 2.1 million ounces of gold equivalent to 2.8Moz of gold equivalent.

It contains a high-grade component of 1.6Moz at 5 grams per tonne gold equivalent.

Mr Kris Knauer said the updated resource has a core of 2.1Moz grading 3.1g/t gold equivalent, compared to the maiden estimate of 2.1Moz at 1.4g/t gold equivalent.

Of the total 2.8Moz resource, 1.9Moz is classified as indicated and represents 81% of the 2.3Moz “pit constrained” component in the scoping study.

Mr Knauer said the 1.6Moz at 5g/t gold equivalent resource provides “significant flexibility” for the company as it advances towards mining.

“Mineralisation remains open in most directions, and we expect this resource to continue to grow; however, with a total 2.8Moz gold equivalent, Hualilan now has critical mass to support development.”

He said the company’s exploration focus will now switch to the previously untouched 25km of prospective strike that we hope will contain several more discoveries.

Verde Zone drill results

Today’s resource update is on the back of a raft of high-grade hits within the Verde Zone at Hualilan.

A highlight hole was 30m at 4g/t gold equivalent (3.9g/t gold, 5.1g/t silver and 0.1% zinc) from 338m; and a bonanza 1.6m at 106g/t gold equivalent (96.6g/t gold, 119g/t silver, and 16.2% zinc) from 402.5m.

Another hole unearthed 35.2m at 3.5g/t gold equivalent (2.5g/t gold, 16.1g/t silver and 1.8% zinc) from 438.8m, including 4.5m at 18.3g/t gold equivalent (14.8g/t gold, 69.5g/t silver and 5.9% zinc from 446m.

Infill drilling program

Infill drilling on 40m by 40m spacings at Verde Zone has been designed to upgrade more than 60% of the mineral resource estimate from the inferred to indicated category to support Hualilan scoping and pre-feasibility studies.

Several of holes in the current round of drilling produced strong intercepts to confirm the continuity of mineralisation between earlier holes.

Proceeding to plan

Mr Knauer said exploration at Hualilan is proceeding to plan.

“This is an excellent set of results from our extension and infill programs at Hualilan … we continue to intersect new zones of high-grade mineralisation open at depth and we continue to see extensions.”

“Our exploration team has been split into northern and southern groups over 20km of prospective strike as our focus shifts towards looking for the next Hualilan which we believe is waiting to be discovered.”

High-grade deposit

Hualilan is a high-grade gold and silver prospect associated with a multi-phase porphyry intrusive.

It has been subject to extensive historical drilling with over 150 holes dating back
to the 1970s and was last explored by Toronto-listed La Mancha Resources in 2006.

Since 2019, Challenger has completed over 200,000m of drilling at Hualilan, which has significantly extended the high-grade mineralisation and discovered the underlying intrusion-hosted Verde system.

Mineralisation at Hualilan now covers 3km of strike and has been defined from surface down to 1,000m, remaining open in all directions.

Mr Knauer said the project has a “rare combination” of grade and scale and is emerging as one of the more exciting South American gold discoveries in recent times.

Verde Zone discovery

The Verde Zone was discovered in early 2021 using surface magnetics and induced polarisation and contributes to the current resource.

The discovery hole returned 125.5m at 1.1g/t gold equivalent, including 71m at 1.8g/t gold equivalent.