Challenger Gold’s Casposo Plant Refurbishment Advances on Schedule for 2025 Start-Up

Refurbishment Progress Validated by Independent Inspection

Challenger Gold Limited (ASX: CEL) has provided a reassuring update on the refurbishment of the Casposo Processing Plant in San Juan, Argentina. The company’s latest announcement confirms that refurbishment activities are advancing safely and efficiently, with progress closely aligned to the existing schedule. This update follows a second independent inspection commissioned by CEL, conducted by the same process engineers who completed the initial audit in December 2024.

The independent report highlights robust advancement across all key processing areas, notably in the solid-liquid separation section, a critical area previously flagged as a potential bottleneck. The refurbishment is on track to meet the commissioning target set out in the Toll Milling Agreement, which aims for commercial operations to commence in the second half of 2025.

Strategic Toll Milling Agreement Underpins Early Cash Flow

The refurbishment supports CEL’s binding Toll Milling Agreement with Casposo Argentina Mining Limited, securing processing of at least 450,000 tonnes of near-surface Hualilan mineralised material over three years. The Casposo Plant, historically a prolific producer of gold and silver, is positioned just 170 kilometres from the Hualilan project site, facilitating efficient ore transport.

This strategy is designed to capitalise on the current elevated gold price environment, above US$3,300 per ounce, by generating early cash flow. These funds will be reinvested into the standalone Hualilan Gold project, including the construction of a flotation with tails leach circuit, a potential heap leach pad, and an open pit mining fleet, thereby accelerating the project’s development timeline.

Detailed Refurbishment Milestones and Technical Insights

The refurbishment work is progressing in a logical flow sheet order, starting with the crushing plant and moving through grinding, gravity concentration, leaching, Merrill Crowe circuit, and refinery. Key milestones include completion of crushing circuit works, refurbishment of leaching tank reducers, and significant progress in thickener and counter-current decantation repairs.

Electrical and mechanical maintenance is advancing well, with 80% of electric motor testing completed and valve replacements underway. The process water system refurbishment is complete, and electrical cabling has been reorganised to support critical plant areas.

Risks and Mitigations

Despite the positive progress, CEL acknowledges key risks remain. Equipment delivery timelines, particularly for imported components, pose the greatest threat to meeting refurbishment deadlines. Additionally, achieving the targeted grind size of P80 75 microns with the single-stage SAG mill configuration requires further operational simulation. However, metallurgical testwork to date suggests minimal recovery loss at slightly coarser grind sizes, which somewhat mitigates this concern.

Overall, the second independent inspection report provides confidence that the refurbishment program is on track, with sufficient time remaining to complete all necessary maintenance and commissioning activities.

Looking Ahead

As the refurbishment advances toward completion, CEL is poised to unlock significant value from the Casposo Plant’s processing capacity. The successful commissioning will mark a pivotal step in generating early cash flow to fund the Hualilan Gold project’s next phase, positioning the company well amid a favourable gold price environment.