Challenger Gold reports metallurgical testwork results

Challenger Gold Limited (ASX:$CEL) has reported the results of a recent metallurgical testwork program aimed at evaluating the opportunity to upgrade the Au-Ag concentrate produced in the Hualilan bulk flotation circuit into doré. The testwork program was conducted to verify the feasibility of several material opportunities identified to enhance the recent Hualilan Scoping Study, with the potential to significantly improve the project's economics.

Executive commentary on testwork results

This is an excellent outcome from the first of a series of metallurgical tests targeting several material opportunities we have identified to improve the already attractive Hualilan Scoping Study economics. The testwork demonstrates a clear and simple pathway to produce gold doré on site which has several benefits for the project. Firstly, it removes some $100 million in costs associated with the transport and treatment of Au-Ag concentrate. Secondly, it increases the payability on the gold produced and removes the delay associated with payment for gold sold via a concentrate reducing working capital requirements. Testwork to address the other material opportunities identified to enhance Hualilan is progressing and we look forward to presenting these in due course.

Summary of metallurgical testwork and outlook

Challenger Gold's metallurgical testwork has shown the potential to significantly improve the economics of the Hualilan Gold Project. The opportunity to upgrade the Au-Ag concentrate into doré on site presents the company with the ability to eliminate significant costs associated with transport and treatment, increase payability on gold and silver, and reduce working capital requirements. The company is optimistic about the ongoing testwork to address other material opportunities and aims to maximize the improvement in projected economics from the production of doré on site. With the forecast EBITDA of US$738m over the Life of Mine and a rapid payback period of 1.25 years, the company's strategy to become a globally significant gold producer seems well-supported by the potential enhancements to the Hualilan Gold Project.