Challenger entered the El Guayabo project back in 2019, at the same time it switched its focus from South African oil and gas to hard rock minerals and secured Hualilan, but it has taken some time to get drilling.

 

The wait appears to have been worth it, with the maiden drillhole intersecting 784m of steeply dipping mineralisation grading 0.2 grams per tonne gold, 1.6gpt silver, 0.1% copper and 12 parts per million molybdenum from 16m (0.4gpt gold equivalent), with an estimated true width of 675m.

 

Higher grade zones within the hole included 21m at 1.1gpt gold equivalent from 403m and 30m at 1.1gpt gold equivalent from 468.5m. 

 

The hole ended in mineralisation.

 

The good result came despite the first test being described as a low-priority hole that was collared significantly east of the main high-grade section of the 1.8km gold-in-soil anomaly, on the drill pad provided early access to the target.

 

The second hole targeted historical underground workings at the Salinas adit where there had been promising channel sampling, with the hole assaying 320m at 0.3gpt from 85m with two higher grade zones: 46.5m at 0.4gpt gold equivalent from 85m and 27m at 1.5gpt gold equivalent from 279.5m, including 1.5m at 19gpt gold equivalent.

 

Three priority holes have been subsequently completed with assays pending, with a fifth underway.

 

The initial holes were both lower priority and have defined two zones of mineralisation over an 800m strike. The mineralisation is associated with intrusives and intrusive breccias. 

 

A second rig was added after the third hole to accelerate testing of the main section of the anomaly, where higher grades are expected. Both rigs have a 1200m depth capacity.

 

Managing director Kris Knauer said the company had confirmed a significant opportunity at El Guayabo that could compliment Hualilan, where the company has nine rigs operating.

 

Knauer said the higher grade core in the maiden hole of 380.5m at 0.5gpt gold equivalent was comparable with the results from Lumina Gold's tier-one Cangrejos gold discovery adjacent to the tenement boundary where there is an indicated resource of 10.4 million ounces and 1.4 billion pounds copper.

 

Challenger has eight other geochemical targets within its wider greater El Guayabo project, with plans to test the highest order targets within the Colorado V permit within the current quarter.

 

El Guayabo is a breccia and porphyry gold/copper project that was last explored in the mid-1990s by Newmont Mining.

 

Challenger shares, which have traded at A20-39.5c over the past year were last traded at 30c, valuing the company at $294 million. 

 

Canaccord Genuity maintained its speculative buy rating and 60c price target.