AusQuest finds more scale at Cangallo as Stage 4 drilling moves closer
AusQuest’s Cangallo discovery in Peru continues to grow, with broad copper intersections and geophysics outlining a porphyry system at least 2.5km by 1km. The exploration momentum comes alongside a sharp cash warning, with $2.1 million on hand representing only 0.41 quarters of funding at the reported spending rate.
- 355.8 metres at 0.31% copper and 0.05g/t gold from 34.2 metres at Cangallo
- CSAMT survey outlines an interpreted porphyry system at least 2.5km by 1km
- Stage 4 permits approved for 20 additional drill pads
- Coober Pedy assays and further Cangallo drilling results remain pending
- $2.1 million cash balance equates to 0.41 quarters of funding on current outgoings
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Cangallo drilling broadens copper footprint
AusQuest Limited (ASX:AQD) has delivered another sizeable expansion of its Cangallo copper-gold discovery in southern Peru, reporting hundreds of metres of continuous mineralisation while drilling continues below the depth reached by its reverse-circulation program.
Hole CANDD004 returned 355.8 metres at 0.31% copper and 0.05g/t gold from 34.2 metres, including 10 metres at 0.73% copper and 20 metres at 0.53% copper. A second hole, CANDD003, intersected 348 metres at 0.23% copper and 0.06g/t gold from 178 metres, with several narrower intervals above 0.4% copper.
The company says the deeper, higher-grade zones are associated with hydrothermal breccias and porphyritic dykes that may represent fluid conduits from a nearby porphyry source. That interpretation is geological guidance rather than a defined resource, and assays from continuing diamond drilling remain outstanding.
Geophysics points to a larger porphyry system
A 59.6-kilometre CSAMT survey has outlined an interpreted porphyry footprint of at least 2.5km by 1km, with low-resistivity zones extending beyond the currently drilled mineralisation. The company says similar patterns to the east and west could represent additional alteration systems, although those targets have not yet been confirmed by drilling.
The result builds on the 2.5km Cangallo geophysical footprint previously reported by AusQuest, with the latest quarterly report now shifting attention to how much of that interpreted system can be tested. Permits for 20 Stage 4 drill pads in the southern part of the prospect were approved late in the quarter, and access preparation is expected to precede RC and diamond drilling later in the year, subject to rig and crew availability.
The planned work is aimed at testing southern and eastern extensions, where surface sampling and geophysics suggest the copper footprint could extend beyond the existing coverage. The company also plans further geological and resource assessment, metallurgical test-work and additional geophysical surveys at Cangallo.
Australian programs advance behind South32 funding
Outside Peru, AusQuest completed 2,349 metres of diamond drilling across four geophysical targets at Coober Pedy in South Australia, where assays are expected during the December quarter. At Balladonia in Western Australia, approval for an approximately 8,000-metre RC program is progressing through the government process, while heritage clearance at Mt Davis has cleared the way for ground EM surveys.
At Morrisey, a Heritage Agreement with the Wajarri Yamaji Aboriginal Corporation supports the planned grant of the Dann Bore exploration application in early 2027, with gravity surveys scheduled over priority magnetite prospects. These Australian activities are funded under AusQuest’s Strategic Alliance Agreement with a South32 subsidiary, with a further $900,000 expected during the December quarter.
Cash position raises the next funding question
AusQuest ended September with approximately $2.1 million in cash after spending $4.518 million on exploration during the quarter. Its Appendix 5B calculates relevant quarterly outgoings at $5.075 million, leaving an estimated 0.41 quarters of funding and no unused finance facilities.
The company said it has not started a new fundraising process, but believes it could secure working capital through equity or loans if required. It also pointed to South32 support for Australian exploration and the option to defer expenditure, relinquish projects or reduce administration costs. For shareholders, the tension is straightforward: Cangallo is generating the report’s strongest exploration momentum just as the current spending pace leaves limited room before additional funding or a change in activity levels becomes important.
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Bottom Line?
Cangallo’s next assays and Stage 4 drilling may strengthen the geological case, but the company will need to match that exploration ambition with a credible funding path.
Questions in the middle?
- Will pending deep-drilling assays confirm stronger hypogene copper zones beneath the current RC drilling limit?
- Can Stage 4 drilling convert the interpreted southern and eastern extensions into a more clearly defined mineralised system?
- How will AusQuest fund Cangallo and its other wholly owned exploration work once the expected South32 contribution is received?
Sources
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Quarterly Activities and Cashflow Report (opens in a new tab)Verified company source. Ausquest Limited · 30 Oct 2026 · investorhub.ausquest.com.au
