Challenger Exploration Limited's (ASX: CEL) is fully funded to the completion of its 8-rig 120,000 metre drill program at its flagship Hualilan Gold project with cash at bank over $40 million. Hualilan has a resource of 627,000 Oz gold at ~10 g/t which is open in all directions. Recent drilling has demonstrated this high-grade skarn mineralisation is underlain by a significant intrusion-hosted gold system with intercepts of 130.8m at 2.5 g/t Au, 209.0m at 1.1 g/t Au, and 110.5m at 3.0 g/t Au.

Our aspiration is to become a globally significant gold producer from our two complimentary gold projects in South America. Hualilan will provide a high-grade low capex started operation prior to a plant expansion to treat the lower grade intrusion hosted mineralisation. Flotation testwork has shown both ore types produce a clean >50 g/t Au concentrate at recoveries of over 90%. Hualilan will underpin CEL with a high margin cashflow while we prepare for a bulk gold operation based on the our discovery in Ecuador where we recently announced an intersection of 134m at 1.0 g/t gold in our discovery hole.

1. Hualilan Project, located in San Juan Province Argentina, is a near term development opportunity. It has extensive historical drilling with over 150 drill-holes and a non-JORC historical resource of 627,000 Oz @ 10 g/t gold which remains open in all directions. The project was locked up in a dispute for the past 15 years and as a consequence had seen no modern exploration until CEL acquired the project in 2019. Results from CEL's first drilling program included 6.1m @ 34.6 g/t Au, 21.9 g/t Ag, 2.9% Zn, 6.7m @ 14.3 g/t Au, 140 g/t Ag, 7.3% Zn and 10.3m @ 10.4 g/t Au, 28 g/t Ag, 4.6% Zn. This drilling intersected high-grade gold over almost 2 kilometers of strike and extended the known mineralisation along strike and at depth in multiple locations. In addition to our 120,000m multiple rig program our 2021 program also includes metallurgical test work of key ore types and an initial JORC Compliant Resource which will allow the Company to move to a PFS.

2. El Guayabo Project covers 35 sqkms in southern Ecuador and was last drilled by Newmont Mining in 1995 and 1997 targeting gold in hydrothermal breccias. Historical drilling has demonstrated potential to host significant gold and associated copper and silver mineralisation with intercepts including 156m @ 2.6 g/t Au + 9.7 g/t Ag + 0.2% Cu and 112m @ 0.7 g/t Au +14.7 g/t Ag + 0.6 % Cu in intrusion related breccia. The Project has multiple targets including breccia hosted mineralization, an extensive flat lying late stage vein system and an underlying porphyry system target neither of which has been drill tested. CEL's first results confirm the discovery of large-scale gold system with over 250 metres of bulk gold mineralisation encountered in drill hole ZK-02 which contains a significant high-grade core of 134 metres at 1.0 g/t gold and 4.1 g/t silver including 63 metres at 1.6 g/t gold and 5.1 g/t silver. ZK-02 is on a 500m trend defined by underground workings with soil geochemistry indicating an additional 1.5km of undrilled strike. The mineralisation appears to be 200 metres wide and is defined from surface to 500 metres at depth.