AusQuest Faces Permit and Funding Challenges as It Expands Peru and Australian Drilling
AusQuest Limited reports significant expansion of its copper-gold system at the Cangallo Project in Peru, alongside progress across multiple Australian base metal projects, supported by a solid cash position and strategic funding.
- Cangallo Project drilling expands copper-gold mineralisation laterally and at depth
- Preliminary metallurgical tests suggest copper oxides amenable to heap leaching
- Ongoing RC and planned diamond drilling programs in Peru and Australia
- Balladonia, Morrisey, Coober Pedy, and Mt Davis projects show promising exploration progress
- Cash position of approximately AUD 7.2 million with additional funding expected from South32
Peru Copper-Gold Breakthrough
AusQuest Limited has delivered a compelling update for the June 2025 quarter, with its Cangallo Project in southern Peru emerging as a significant copper-gold discovery. Stage 2 reverse circulation drilling has materially expanded the known porphyry system both laterally and at depth, with assays confirming broad zones of copper mineralisation starting near surface and extending beyond 300 metres. Notably, drill holes frequently ended in mineralisation, indicating the system remains open at depth.
Geological mapping and rock-chip sampling have identified a large caldera-like structure hosting the mineralisation, with copper-bearing dykes intruding volcanic host rocks. These dykes show higher copper grades, suggesting proximity to a causative porphyry source. Encouragingly, preliminary metallurgical test-work indicates that copper oxides in the system could be amenable to heap leaching, a cost-effective processing method that could enhance project economics.
Looking ahead, AusQuest plans to commence diamond drilling in late August to test the depth extent of mineralisation and refine geological vectors toward the porphyry centre. Drill permits for an expanded Stage 3 RC program are expected imminently, with new drill pads being permitted to explore the southern extensions of the system. This methodical approach aims to unlock the full scale and grade potential of the Cangallo discovery.
Australian Base Metals and Magnetite Progress
Meanwhile, AusQuest’s Australian portfolio continues to advance with multiple projects undergoing active exploration. At Balladonia in Western Australia, a substantial RC drilling campaign targeting copper, nickel, and rare earth elements is underway, testing geophysical anomalies and base metal targets. Similarly, the Morrisey Project is delivering promising magnetite intersections, with samples sent for detailed recovery testing to assess potential for premium iron products suitable for green steelmaking.
In South Australia, the Coober Pedy Project benefits from recent geophysical surveys that have outlined induced polarisation targets indicative of iron-oxide copper-gold mineralisation. Heritage clearances have been secured for drilling at Mt Davis in Western Australia, where base metal targets are being prepared for RC drilling in the coming months.
Jubilee Lake in Western Australia remains a focus for nickel-copper-PGE exploration, with heritage negotiations ongoing ahead of planned drilling. The company’s strategic alliance with South32 continues to underpin exploration funding, particularly for Australian projects, enabling AusQuest to maintain a robust pipeline of work programs.
Financial Position and Outlook
AusQuest closed the quarter with approximately AUD 7.2 million in cash, following significant exploration expenditure of around AUD 3.6 million. Additional funding is expected in the third quarter of calendar 2025 from South32 under the Strategic Alliance Agreement, supporting ongoing and planned activities. The company remains confident in its ability to secure further capital if required, with a disciplined approach to managing exploration spend and project prioritisation.
Looking forward, the September quarter will focus on completing assessments of recent drill data, optimising drill targets across projects, and advancing permitting and heritage clearances. The combination of a major copper-gold discovery in Peru and steady progress across Australian base metal assets positions AusQuest as a company to watch in the evolving resource landscape.
Bottom Line?
AusQuest’s expanding footprint in Peru and Australia, backed by solid funding, sets the stage for a pivotal exploration phase ahead.
Questions in the middle?
- How will upcoming diamond drilling at Cangallo refine the understanding of the porphyry system’s size and grade?
- What are the implications of preliminary heap leach test results for the potential economics of the Cangallo Project?
- How will AusQuest balance exploration funding between its Peru and Australian projects amid evolving market conditions?