Challenger Exploration Limited (ASX: CEL) has executed an agreement to farm-in to the Colorado V tenement in Ecuador, increasing its position in the area by over 830%.
The Colorado V tenement covers 2,331 hectares (23.3 sq kms) and is located on the northern and eastern margins of the El Guaybo Tenement.
Under the terms of the farm-in agreement, Challenger will fund all exploration for the first five years to earn up to a 50% interest in any discovery it makes on the tenement. Challanger and the current owner, Ecuadorian company Goldking Mining SA, will then jointly fund a Definitive Feasibility Study and the ongoing development.
Managing Director, Kris Knauer, said the farm-in agreement provides the company with regional scale by increasing its footprint to over 2,600 hectares in the emerging exploration hotspot of southern Ecuador.
“Importantly we are in the same geological setting as the 17.7m ounce Cangrejos Gold and Copper Project which is within five km of our Project and we are within 50kms of Solgold’s exciting new Cisne Project.
“Our limited reconnaissance on the Colorado V concession identified porphyry mineralisation in a number of locations across the concession.
“There is also evidence of porphyry mineralisation supported by 56 drill holes with our partner’s geological team indicating porphyry mineralisation was intersected but never systematically logged or assayed.
We are planning to quickly re-assay the existing core and commence drilling. This represents an outstanding exploration opportunity for the company,” Mr Knauer said.
Current gold production in the area comes from a combination of veins and intrusive breccias similar to those identified at El Guayabo.
Goldking has undertaken extensive and high-quality exploration which includes a multi element soil geochemistry survey covering approximately 20 sq. km, 21,500 m of core drilling and a yet to be defined number of kilometres of underground exploration drives and workings.
Limited reconnaissance field work undertaken by CEL during initial due diligence has identified porphyry and bulk gold and copper mineralisation in a number of locations in both underground adits and outcrop with due diligence indicating that Goldking encountered porphyry mineralisation in a number of drill holes.
This porphyry mineralisation was bypassed and not systematically logged or sampled as drilling was designed specifically to identify additional high-grade mill feed for Goldking’s existing operations.
Mr Knauer said Challenger will commence exploration on the Goldking tenement immediately in order to provide more detailed information ahead of shareholder approval. The priorities of this programme are to:
- systematically sample and assay the exposures of porphyry mineralisation identified in the underground exploration adits;
- identify the drill holes in which Goldking encountered porphyry mineralisation and log and assay (where warranted) these mineralised porphyry intercepts.
Additionally, Challenger will conduct a detailed mapping and sampling program to define any other existing exposures of porphyry style mineralisation elsewhere on the tenement.
All drill core on the tenement that were drilled targeting high grade gold will be logged by Challenger geologists. This core has not been logged by geologists with porphyry experience and limited sections of this core, have been assayed for gold only.
Other Goldking data, including underground sampling and gold assay results and the 20 sq km of multi element soil data will be integrated into Challenger’s existing regional database.