Challenger Gold Limited has received the final explosives permit required to begin drill and blast operations at its flagship Hualilan Gold Project in San Juan, Argentina. The approval, issued by Argentina’s Ministry of National Security, allows Toll Milling to commence.
The Toll Milling Agreement with Casposo Argentina Mining Limited covers the processing of 450,000 tonnes of near-surface Hualilan material over three years at the Casposo Plant, 165 km from site. A recently completed Pre-Feasibility Study demonstrated strong economics, including forecast EBITDA of US$142.8 M and post-tax free cash flow of US$91.8 M at current spot prices.
The strategy aims to capitalize on record-high gold prices to generate early cash flow and fund development of the larger standalone Hualilan project. Importantly, Toll Milling will process only ~3% of the current 2.8 Moz AuEq resource, preserving significant growth potential.
Key Highlights
- Explosives Permit Granted– final approval required for drill and blast operations at Hualilan.
- Toll Milling Agreement Secured with Casposo Argentina Mining Limited to process 450,000 tonnes of near-surface Hualilan mineralized material over three years.
- Compelling Project Economics– Pre-Feasibility Study demonstrates robust margins, low upfront capital of US$8.9 M, and rapid three-month payback.
- Fully Funded– recent A$37.5 M equity raising covers development through to first cash flow.
- Strategic Upside– Toll Milling plan extracts only ~3% of the 2.8 Moz AuEq Hualilan resource, preserving substantial growth potential.