AusQuest’s Peru Discovery Opens Door to Transformational 2025 Amid Permitting Challenges
AusQuest Limited has announced a significant porphyry copper-gold discovery at its Cangallo Project in Peru, marking a potential turning point ahead of an active 2025 exploration calendar. The company also secured $2.4 million in funding to advance drilling programs across its Peru and Australian assets.
- Discovery of large-scale porphyry copper-gold system at Cangallo, Peru
- Notable drill intercepts include 348m at 0.26% Cu and 0.06 ppm Au from near surface
- Ongoing permitting and community consultations for Lantana and Playa Kali prospects
- Australian projects advancing with planned drilling at Balladonia and Morrisey
- Capital raise of ~$2.4 million supports exploration activities and maintains $2.1 million cash balance
A Breakthrough Discovery in Peru
AusQuest Limited’s December 2024 quarterly report reveals a landmark discovery at its Cangallo Copper Project in southern Peru. The maiden Reverse Circulation (RC) drilling program, comprising eight holes totaling approximately 3,000 metres, has identified a large-scale porphyry copper-gold system. Early assay results from the first two drill holes show extensive mineralisation starting near surface, with highlights including 348 metres grading 0.26% copper and 0.06 ppm gold from just 6 metres depth.
This discovery is significant not only for its scale but also for the quality of mineralisation, which includes both oxide and sulphide copper minerals. The mineralisation remains open in all directions, suggesting considerable potential to delineate a shallow copper oxide resource amenable to lower-cost processing methods. Further assay results from the remaining drill holes are anticipated by early February 2025, which will provide a clearer picture of the deposit’s extent and grade distribution.
Advancing Permitting and Exploration in Peru
Alongside the Cangallo breakthrough, AusQuest is progressing drill permitting for its Lantana and Playa Kali copper prospects. Both projects have completed community consultations and are awaiting government approvals expected in early Q2 2025. These prospects are strategically located within Peru’s prolific southern coastal belt, a globally recognised copper province hosting some of the world’s largest and most productive mines.
The company’s portfolio in Peru is well positioned, with tenements covering approximately 30 square kilometres at Cangallo and additional claims at Cerro de Fierro, Parcoy, and Playa Kali. The geological setting and preliminary surface sampling suggest multiple porphyry and manto-style copper-gold targets, which could underpin a transformational growth phase for AusQuest in 2025 and beyond.
Momentum Builds in Australian Projects
While Peru commands attention, AusQuest is simultaneously advancing several Australian projects. At the Morrisey Magnetite Project in Western Australia, recent drilling and Davis Tube Recovery test work have confirmed a premium-grade iron product exceeding 70% Fe with low impurities, indicating potential for cost-effective processing. Heritage clearances have been secured for drilling five new magnetite targets, with plans underway in collaboration with South32 under a Strategic Alliance Agreement (SAA).
In the Fraser Range region, the Balladonia Project is preparing for a major RC drilling campaign targeting nickel, copper, and rare earth element mineralisation. Ground electromagnetic surveys have upgraded several high-priority conductors to drill status, with heritage clearances completed for 47 drill sites. Drilling is expected to commence in early 2025, subject to rig availability and weather conditions.
Additional Australian projects, including Coober Pedy, Moora, Mt Davis, Hamilton, and Jubilee Lake, are progressing through various stages of exploration and permitting, supported by the SAA with South32. This diversified pipeline underscores AusQuest’s balanced approach to exploration across multiple commodities and jurisdictions.
Financial Position and Outlook
To fund its ambitious exploration agenda, AusQuest successfully completed a Non-Renounceable Rights Offer and Shortfall Placement, raising approximately $2.4 million before costs. This capital injection bolsters the company’s cash position to around $2.1 million at quarter-end, with additional funding expected from South32 in Q1 2025 to support Australian work programs.
Exploration expenditure for the quarter was $1.36 million, reflecting the active drilling and survey campaigns underway. The company remains vigilant on cost management while advancing its portfolio, with the board confident in securing further capital if required to sustain momentum.
Navigating Challenges and Next Steps
AusQuest continues to manage regulatory and legal considerations, including an ongoing appeal in the Supreme Court of Peru related to access payments for drilling on state-owned land. The company is monitoring developments closely and will update shareholders as necessary.
Looking ahead, the March 2025 quarter is set to be pivotal, with planned drilling at Balladonia and Morrisey, assessment of Moora drilling results, heritage clearance progress at Jubilee Lake, and further exploration activities in Peru including follow-up drilling at Cangallo and permitting completion for Lantana and Playa Kali.
These developments position AusQuest at the cusp of potentially transformational growth, driven by a compelling discovery in Peru and a robust pipeline of exploration targets in Australia.
Bottom Line?
AusQuest’s Cangallo discovery and robust exploration pipeline set the stage for a defining year in 2025, but upcoming assay results and permitting milestones will be critical to sustaining investor confidence.
Questions in the middle?
- Will the pending assay results from Cangallo confirm the scale and grade needed for resource delineation?
- How quickly can AusQuest advance permitting and commence drilling at Lantana and Playa Kali?
- What impact will South32’s funding and strategic alliance have on accelerating Australian project development?
