AusQuest Limited has reported significant progress at its Cangallo copper-gold project in Peru, extending mineralisation and advancing drilling programs, supported by a $10 million capital raise and an extended partnership with South32.
- Stage 3 drilling at Cangallo extends copper-gold mineralisation over 500m south and beyond 800m depth
- Diamond drill-hole CANDD002 intersects 555m at 0.26% copper and 0.06g/t gold from near surface
- $10 million placement completed to fund expanded drilling activities
- Strategic Alliance Agreement with South32 extended to December 2027
- Exploration advances across multiple Australian projects targeting base metals and magnetite
Cangallo Project Drilling Breakthroughs
AusQuest Limited has delivered a robust update for the December 2025 quarter, spotlighting its flagship Cangallo copper-gold project in Peru. The company’s Stage 3 reverse circulation (RC) and diamond drilling programs have significantly expanded the known mineralised footprint. Notably, drilling has extended the strike length by over 500 metres to the south and confirmed mineralisation depths exceeding 800 metres, underscoring the extensive nature of the porphyry system.
Highlighting the drilling success, diamond drill-hole CANDD002 intersected an impressive 555 metres grading 0.26% copper and 0.06 grams per tonne gold starting from just 5 metres below surface. This intersection builds on earlier higher-grade results and reinforces the potential scale and continuity of the deposit.
Funding and Strategic Partnership Strengthened
To support the accelerated exploration pace, AusQuest completed a $10 million placement during the quarter. The capital injection is earmarked for expanding Stage 3 RC and diamond drilling at Cangallo, enabling the company to pursue deeper and broader targets with greater confidence.
In parallel, the company extended its Strategic Alliance Agreement (SAA) with South32 Limited’s wholly owned subsidiary for an additional two years, now running through to December 2027. This partnership continues to provide both financial backing and technical collaboration, enhancing AusQuest’s capacity to advance multiple projects efficiently.
Broader Australian Exploration Progress
Beyond Peru, AusQuest has maintained momentum across its Australian portfolio. The Balladonia project in Western Australia saw further drill programs designed to test lead-zinc and copper-gold mineralisation under the SAA framework. Encouraging magnetite test results at the Morrisey project revealed iron grades exceeding 70%, bolstering its commercial potential.
Meanwhile, the Coober Pedy project in South Australia is poised for initial drill testing of iron-oxide copper-gold targets in the second quarter of 2026. Additional reconnaissance and geochemical surveys at Mt Davis have identified promising base metal anomalies, setting the stage for future drill campaigns.
Financial Position and Outlook
AusQuest closed the quarter with a strong cash position of approximately AUD 9.9 million, reflecting the recent capital raise and ongoing funding support from South32. Exploration expenditures continue to be carefully managed, with a focus on advancing high-priority targets and securing necessary permits for upcoming drilling phases.
Looking ahead, the company plans to complete Stage 3 RC drilling at Cangallo, commence deeper diamond drilling, and initiate resource modelling and metallurgical studies. Permitting efforts are also underway for Stage 4 drilling at Cangallo and other prospects, aiming to sustain exploration momentum into 2026.
Bottom Line?
AusQuest’s expanded drilling and strengthened funding position set the stage for a pivotal year in advancing its copper-gold ambitions across Peru and Australia.
Questions in the middle?
- What will the pending assay results from Stage 3 drilling reveal about the grade and extent of mineralisation at Cangallo?
- How will the extended Strategic Alliance Agreement with South32 influence future exploration funding and project development?
- What are the timelines and potential impacts of permitting delays on the planned 2026 drilling programs?