Challenger Gold Limited (ASX: CEL) (“Challenger” or “the Company”) has delivered a truly transformative start to 2025, doubling its resource base in Ecuador while accelerating toward near-term production in Argentina. With strong exploration success, strategic funding, and a revitalised leadership team, the Company is poised to unlock major value for shareholders across two world-class gold projects in Latin America.
Ecuador Projects Deliver Massive Resource Growth
Doubling of Mineral Resources
Challenger Gold Limited’s exceptional quarter was underpinned by a transformational uplift in the Mineral Resource Estimate (MRE) across its Ecuadorian gold-copper assets. The Company has doubled its total MRE from 4.5 to 9.1 million ounces gold equivalent (Moz AuEq), propelling its projects into the upper tier of undeveloped gold resources in South America.
The updated MRE comprises 570 million tonnes at 0.50 g/t AuEq, with Challenger’s attributable share sitting at 6.9 Moz AuEq across the El Guayabo (100%) and Colorado V (50%) projects. This estimate incorporates a high-grade core of 2.1 Moz at 1.0 g/t AuEq, including 1.2 Moz at 1.2 g/t AuEq, paving the way for strong early-stage production potential and robust cash flows.
Figure 1: Soil geochemical analysis and regional exploratory drilling at the El Guayabo Gold-Copper Project
Massive Exploration Upside Remains
Challenger has drilled just five of the 15 geochemically anomalous targets identified, with all 13 anomalies tested to date returning gold-copper mineralisation. Mineralisation remains open in all directions, reinforcing the exploration upside potential across the projects.
The El Guayabo and Colorado V concessions adjoin Lumina Gold’s 20.5 Moz Cangrejos Project and share similar geology and mineralisation styles. The latest drilling and geochemical results suggest that the broader system across these concessions could host additional large-scale mineralised zones.
Strategic Monetisation Options Now Open
With resource delineation substantially complete, Challenger is now evaluating multiple options to unlock the strategic value of its Ecuadorian portfolio:
- Listing the assets on the Toronto Stock Exchange (TSX) via a spinout structure to capture valuation uplift in North American markets.
- A potential sale to realise immediate capital for advancing other core assets.
- A farm-in agreement with a major mining partner to drive development while retaining upside exposure.
These options will allow the Company to monetise its Ecuadorian holdings while channelling capital into its flagship Hualilan Gold Project in Argentina.
Lumina Acquisition Highlights Value of Challenger’s Ecuadorian Assets
The recent CAD$581 million acquisition of Lumina Gold by CMOC Singapore sets a strong valuation benchmark for Challenger Gold’s adjoining projects in Ecuador. Lumina’s 26Moz AuEq Cangrejos Project shares identical geology and grades with Challenger’s 9.1Moz AuEq, forming part of a larger mineralised system split only by a tenement boundary. Applying Lumina’s acquisition price of US$16/oz AuEq values Challenger’s 6.9Moz net attributable resource at AUD$174 million or AUD$25/oz AuEq, highlighting substantial strategic value and monetisation potential for the Company’s Ecuadorian portfolio.
Figure 2: Location of Challenger’s El Guayabo and Colorado V Projects (9.1Moz AuEq) adjoining Lumina Gold’s 20.5Moz Cangrejos Deposit—highlighting the shared mineralised system and close proximity (6 km) between deposits.
Hualilan Gold Project Advances Toward Toll Milling Production
Final Pit Designs and Mining Schedule Completed
Challenger has made outstanding progress on the Hualilan Gold Project in San Juan, Argentina, particularly with its near-term Toll Milling development pathway. The Company finalised open pit designs and mining schedules for the Sanchez, Norte, and Magnata pits. These three pits are sufficient to support the entire Toll Milling strategy, with the Sentazon pit held in reserve.
The revised pit schedule focuses entirely on Indicated Resources, with all Inferred material excluded from Toll Milling and instead earmarked for future processing in the full-scale Hualilan development. This approach enhances confidence in early cashflows and streamlines operations.
Optimised Grade and Flexibility in Operations
Challenger optimised its mining schedule to prioritise higher-grade ore in the first year of production. The Company plans to maintain a rolling 3–6 month stockpile buffer throughout operations. Waste material from the pits will be repurposed for access roads and pioneering work—laying the groundwork for larger-scale mining.
Mining options under review include day-shift-only and 24/7 operations, with equipment strategies assessed for contractor, hire, and owner-operator configurations. Drill and blast vendors have already been shortlisted, and haulage options between Hualilan and the Casposo plant are now being evaluated.
Plant Refurbishment and Pre-Feasibility Near Completion
Plant refurbishment has commenced, following the drawdown of US$2 million (AUD ~$3.2 million) from a US$20 million Project Finance Facility. Repairs are underway at the Casposo processing facility, with funds provided by a local Argentine bank in late 2024.
Challenger expects to finalise its Pre-Feasibility Study (PFS) for Toll Milling shortly. The PFS is being prepared in line with both JORC (Australia) and NI 43-101 (Canada) standards and involves contributions from industry-leading firms such as Ausenco, Mining Plus, Micromine, and Fuse Advisors.
Appointment of GM to Lead Operations
The Company strengthened its executive team with the appointment of Ubirata (Bira) De Oliveira as General Manager Operations for Hualilan. Bira brings more than 35 years of technical and operational mining experience across Latin America and West Africa. He will oversee the transition from project development to production and lead operational readiness, contractor management, and team building.
Financial and Corporate Developments
Project Finance Facility Activated
Challenger has activated its US$20 million Project Finance Facility, arranged by Middlegate Securities and ECM Capital Advisors. The Company drew the first tranche of US$2 million during the quarter, using the funds for early mining works, PFS costs, corporate expenses, and working capital.
Key terms include:
- Interest rate of 8.5% (rising to 12.75% post-December 2025)
- No collateral required
- Repayable after first Toll Milling cashflow
- Export proceeds managed through an escrow account at Banco Comafi
Exploration and Corporate Spending
During the March quarter, Challenger spent $2.9 million on exploration—$2.6 million in Argentina (inflated by a one-off $520k land rights payment) and $0.3 million in Ecuador. The Company expects Ecuadorian spend to decline further following resource completion.
Administration and corporate costs totalled $1.4 million. This includes one-off costs such as $150k for a terminated investor relations mandate in Canada and $271k associated with the PFS.
Additionally, the Company paid a US$2 million (AUD ~$3.2 million) access fee under the Toll Milling Agreement.
Appointment of New Chairman
Challenger welcomed Mr Eduardo Elsztain as its new Non-Executive Chairman during the quarter. Mr Elsztain is a well-known Argentine businessman with extensive real estate and mining experience across Latin America. He replaces Mr Sergio Rotondo, who remains on the Board as Executive Vice Chairman.
Outlook: 2025 Set to Deliver Major Milestones
Challenger Gold enters the second quarter of 2025 with two world-class gold projects—each advancing toward significant value inflection points. In Ecuador, the Company will now pursue a structured monetisation pathway to realise the value of its 6.9 Moz AuEq resource base. Meanwhile, at Hualilan, the Company is finalising PFS work and preparing for the start of Toll Milling operations, supported by strategic funding and a strengthened leadership team.
With resource growth, operational progress, and strategic planning converging, Challenger Gold stands poised to deliver on its promise of becoming a major player in the Latin American gold sector.
Investor’s Outlook
Challenger Gold Limited (ASX: CEL) has demonstrated strong recent momentum, with share price gains reflecting increasing investor confidence and renewed interest in its gold exploration strategy.
Share Price and Market Performance
CEL last traded at $0.079, positioning the stock near the top of its 52-week range of $0.037 to $0.088. With a current market capitalisation of $140.08 million and 1.6 billion shares on issue, Challenger is gaining traction as a mid-tier gold explorer with upside potential.
Strong Short-Term Gains
CEL has delivered a standout +33.90% gain over the past month, signalling growing market enthusiasm. The stock has also returned +68.09% year-to-date in 2025, driven by a combination of exploration progress, improved gold sentiment, and renewed investor attention.
Longer-Term Stability and Sector Outperformance
Over the past 12 months, CEL has achieved a modest +3.95% gain, outperforming its peers with a +32.02% advantage versus the sector. This outperformance underscores the Company’s relative resilience and ability to capture investor interest, even during broader market volatility.
Outlook
With a strong gold price environment and investor appetite for quality exploration plays, Challenger Gold is well-placed to build on its recent gains. Continued project updates and exploration success could further re-rate the stock and enhance shareholder value.
For investors seeking exposure to a company with scale, sector momentum, and positive price action, Challenger Gold represents a compelling opportunity in the Australian gold exploration space.
