• Channel sampling indicates potential to significantly increase higher grade 1.5Moz resource at El Guayabo
  • “A 200m extension to surface could materially increase the high-grade core of the MRE”: Challenger managing director Kris Knauer
  • Results from channel sampling and pending drill assays to be included in upcoming resource update


Challenger’s first channel sampling program at the El Guayabo copper-gold project in Ecuador has delivered in spades, identifying the potential to increase the higher-grade core of its resource estimate.

The monster 4.5Moz gold equivalent resource announced in June this year for El Guayabo in Ecuador, along with an existing 2.8Moz at Hualilan in San Juan, Argentina, transformed Challenger Gold (ASX:CEL) into a two-project company.

Both projects remain ‘open’, which means there is plenty of room to grow.

At El Guayabo, there is a high value, high-grade core of 1.5 Moz at 1g/t AuEq — including 1Moz at 1.2 g/t AuEq – which new channel sampling shows could be even bigger.

The objective of channel sampling – collected along surface trenches, or floors and walls of underground workings — is to cut a linear channel across the vein or orebody for the most representative samples possible.

Because El Guayabo’s GY-A and GY-B deposits are located on the sides of a steep hill, Challenger has not be able to drill the potential top 200m of this high-grade zone of mineralisation.

In this case, channel sampling is a suitable substitute.

Challenger Gold (ASX:CEL)

Any mineralisation extension through this up-dip 200 metres to surface has the potential to add significantly to the high-grade core of the existing resource, the company says.

In any open pit mining operation, this high-grade material at surface would be the first material to be mined and processed.


‘Materially’ bigger high grade resource incoming 

Initial results from this sampling, designed to extend the high-grade core 200m to surface, are excellent. Highlights include:

  • 174.4m grading 1.2g/t gold equivalent, including a 6.1m zone at 13.6g/t AuEq;
  • 9m at 12.6g/t AuEq; and
  • 17.4m at 3.3g/t AuEq.

Most results are open in all directions as the sampling of the channels is limited by the exposed outcrop.

Sampling on the western margin of GY-A also uncovered a new zone of high-grade stuff, with several channels above 5 g/t AuEq including 45.8m at 1.4 g/t AuEq (including 17.8m at 2.7 g/t AuEq).

Additionally, channel sampling between the GY-A and GY-B anomalies returned the thickest channel about 300m east of any drilling, opening up a significant new target to extend the current overall resource of 4.5Moz.

This is an excellent outcome from Challenger’s first channel sampling program, managing director Kris Knauer says.

“The results point to the extension of the high-grade component of the El Guayabo MRE two hundred meters above the current drilling to surface,” he says.

“With this high-grade zone covering 250 meters strike and being up to 200 meters true width a 200 meter extension to surface could materially increase the high-grade core of the MRE.

“Additionally, the program has extended the mineralisation well beyond the limits of the current drilling including an intersection of 174.4 metres at 1.2 g/t gold equivalent.

“This intersection extends 300 metres beyond any drilling at El Guayabo and opens a significant new target.”



This is monster copper-gold territory

El Guayabo is 5km along strike from the 17.1Moz Cangrejos gold project where a PFS is underway on a 469,000ozpa, 26-year mining operation.

Owner Lumina Gold (TSX:LUM) estimates a capital cost of US$925m and super low all-in-sustaining costs of US$671/oz.

And yet Ecuador’s El Oro Province is one of the most under-explored sections of the Andean Copper Belt, which extends from Chile to Colombia and hosts some of the world’s largest porphyry copper and gold deposits.

Previous exploration carried out at El Guayabo by Newmont and Odin from 1994 to 1997 included surface pit and rock chip geochemistry, followed by the drilling of 33 drill holes to evaluate the larger geochemical anomalies with a focus on either surface gold anomalies or depth extensions of higher-grade gold zones exploited by artisanal miners.

However, this drilling did not record details that would have been typical, industry standards for porphyry copper exploration at that time.

This resulted in several holes that ended in economic mineralisation not being followed-up as important details that would have allowed the type of target to be better explored were missed.

Challenger is determined to make the most of this opportunity.

Data from the channel sampling work will be incorporated into the updated resource estimate. Likewise, assays pending from several drill holes will also be included in the resource update.




This article was developed in collaboration with Challenger Gold, a Stockhead advertiser at the time of publishing.


This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.