Hualilan Toll Milling Schedule Frontloads 224,000t at 6.4 g/t Au in First Year

Progress Towards Mining and Toll Milling Readiness

Challenger Gold (ASX: CEL) has announced significant progress in preparing its Hualilan Gold Project for mining and toll milling operations. The company has completed the final open pit mine designs and mining schedules for the toll milling pits, marking a critical step towards operational readiness. These schedules are now based exclusively on Indicated Resources, reflecting a 10% increase in mineral grade compared to earlier estimates.

The initial 150,000 tonnes of mined material is reported to average 8.7 grams per tonne (g/t) gold and 34.5 g/t silver, with over 90,000 tonnes of toll milling feedstock expected within the first three months of mining. This front-loaded high-grade material is designed to enhance early cash flows and operational efficiency.

Operational Flexibility and Contract Finalisation

Challenger Gold’s mining schedule incorporates enhanced operational flexibility by requiring only three of the four potential toll milling pits, Sanchez, Norte, and Magnata, with the Sentazon pit held in reserve. This approach reduces reliance on any single pit while preserving optionality for additional feed if needed. The completion of the mining schedule enables the company to finalise contract mining and haulage agreements, critical for the seamless transport of material to the Casposo toll mill.

Refurbishment of the Casposo Plant, operated by Austral Gold, is underway following the receipt of funding from a local Argentine bank in late December 2024. Equipment repairs are in progress, supporting the company’s timeline for commencing toll milling operations.

Pre-Feasibility Study and Economic Modelling

Challenger Gold has accelerated its study program, advancing directly to a Pre-Feasibility Study (PFS) for the toll milling startup, scheduled for completion in March 2025. The PFS will comply with both JORC and Canadian NI 43-101 reporting standards, ensuring rigorous independent verification and exclusion of inferred resources from the mine plan.

The company has engaged a suite of international consultants specializing in metallurgy, mining, infrastructure, and economic analysis to underpin the PFS. Metallurgical test work is ongoing, with variability testing expected to conclude by the end of February 2025, feeding into the processing cost model and overall economic evaluation.

Resource and Mining Schedule Highlights

The final toll milling pit design encompasses approximately 450,000 tonnes of mineralized material at an average grade of 6.4 g/t gold and 37.8 g/t silver, containing an estimated 92,500 ounces of gold and 548,000 ounces of silver. The schedule front-loads higher-grade material, delivering 224,000 tonnes in the first 12 months and maintaining a 3 to 6-month stockpile buffer to ensure operational continuity.

This represents a meaningful 10% grade uplift over previous plans, which should materially improve toll milling outcomes and project economics. The mining plan also incorporates selective mining methods with 5% dilution and 95% recovery assumptions, optimizing resource extraction efficiency.

Looking Ahead

Challenger Gold’s methodical approach to mine design, contract finalisation, and plant refurbishment positions the company well for a timely transition into toll milling operations. The upcoming PFS will provide a comprehensive economic framework to support investment decisions and operational planning.

With key milestones on track and operational flexibility embedded in the mining schedule, Challenger Gold is advancing steadily towards unlocking value from the Hualilan project.