CEL - Challenger Gold

[Sean K]

Since the comment about the SP going to "double and double again" by the MD the share price has actually halved and it's looking like it will halve again. However, in the past 12 months blackrock have doubled their holding in CEL to ~140,000,00 shares. Pretty much slicing their hands all the way down from the mid 30s to mid 20s to mid-teens catching the falling knife. Not sure if I should feel good about that or not...

All these junior goldies are getting hammered at the moment so it's looking like that debt/raising from several weeks ago may have been a good idea but my biggest worry now with CEL is that it turns into the new HCH. Forever drilling, forever diluting, never mining, and waiting around for the takeover that's never coming.

Rats are fleeing this sinking ship.

I've bought into this several time over the past 18 months, on break ups and also weakness.

Unfortunately, the reason why I first bought it, on what fundamentals or prospectivity there were, don't seem to exist anymore.

The interim JOC on Argentina was about half what I expected. The MD told us over and over that the skarn / high grade area in particular was going to be three times, or so, over the historical MRE. Wrong. Major wrong. In fact, potentially hidden from investors. If it was going to be so much less than ramped it should have been material to the market and announced prior. The 'intrusion' part was going to be bulk tonnage and you just make it one giant open pit. That is not going to be the case at all. Unless the updated JORC comes back with closer to 2Moz in the skarn and a mineable / payable 2Moz in the intrusion, then Argentina is an artisanal type prospect.

Ecuador may be their saviour. They need the initial MRE to come out way above expectations, or I fear this company may be toast.

While just about every gold explorer has been trashed the past year, those participating in recent CRs must be wringing their hands.

 

[The Triangle]

CEL appointed a new director today -Pini Althaus - Normally I wouldn't really care, but this guy is taking zero cash and big options - effectively $1.1 million if targets (essentially double the share price) are reached over 3 years.

Mr Althaus has made numerous appearances as a critical minerals expert on news outlets including, The New York Times, FOX, WSJ, Financial Times, CNBC, Forbes, and the Global Times, and continues to be an ongoing contributor to these outlets. Mr Althaus' role is to introduce Challenger into this network and provide the Company with an ongoing presence in the North American market as it transitions from an explorer to a developer.

I don't really know what to think about this... Not a very traditional path, but at least they're being honest about the purpose of this director. He can be CELs Kevin O'Leary!

 

[Sean K]

CEL appointed a new director today -Pini Althaus - Normally I wouldn't really care, but this guy is taking zero cash and big options - effectively $1.1 million if targets (essentially double the share price) are reached over 3 years.

Mr Althaus has made numerous appearances as a critical minerals expert on news outlets including, The New York Times, FOX, WSJ, Financial Times, CNBC, Forbes, and the Global Times, and continues to be an ongoing contributor to these outlets. Mr Althaus' role is to introduce Challenger into this network and provide the Company with an ongoing presence in the North American market as it transitions from an explorer to a developer.

I don't really know what to think about this... Not a very traditional path, but at least they're being honest about the purpose of this director. He can be CELs Kevin O'Leary!
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Well, unless something materially changes due to bonanza exploration eureka success, I’ll have a sell posted at 29c. KKs ramps obviously haven’t worked to date and they’re seeking another sales angle. If justification for appointment is being put on TV, maybe they should have got a Kardashian on board.

 

[The Triangle]

Well, unless something materially changes due to bonanza exploration eureka success, I’ll have a sell posted at 29c. KKs ramps obviously haven’t worked to date and they’re seeking another sales angle. If justification for appointment is being put on TV, maybe they should have got a Kardashian on board.

I'm all for Kardashians promoting CEL.

Celebrity endorsements worked for crypto.

 

[Sean K]

Some more amazing intersections (or interceptions) but I just don't know where Hualilan is going. The MRE update in March really needs to surprise to the upside. They've put 800 holes into this lama paddock for 200K + meters of drilling and only have 2m ounces. NVA put about five holes into RPM in Alaska and produced a 1.5m ounce MRE... Sure, very inferred, but with this much drilling they need to produce something significant and ready to sell.

The next MRE here really needs to have a 3 in front of it with a 2 in the high grade easy to dig up mantos or I'm afraid Argentina is a lama with flees. Will be interesting to see KKs spin on this in his next video.

I'm tempted to pick this in the March tipping comp with the vague hope that the next MRE makes this viable.

 

[Sean K]

Mr Market is writing this puppy off. Not sure how this is going to turn around unless they put some drill holes north or south of Hualilan that strike another manto or two. They are probably there, just by looking at the geography, but their drilling focus has been in a tight range.

The only upside from here is most likely an exceptional initial MRE in Ecuador that the neighbours might like to buy off them.

The one year chart looks like disaster. The longer term one not that bad, but still sad.

This is an early speculation play. Still could do anything.

 

[Sean K]

This needed a 3 in front of it. It's close and will probably get there with the additional 50k of drilling planned. The key is the high grade skarn been at scale enough to warrant a mine. The intrusion part has way too much waste to bother digging up IMO. So, it's getting there. Maybe if they discover another Manto along strike with another 1m oz at 5g/t they have a great deposit. The current high grade part is obviously very good and close ish to surface so could be a mine in itself. Just lacking scale. Scale that was promised for a long time by KK, but he hasn't delivered. Although, he thinks it's big enough now. Dunno. Obviously some good intersections outside the MRE still to be added to the next update.

 

[Sean K]

Mass tonnage, low grade, typical Andean porphyry large scale mine potential at great capex.

Best plan here would be to sell it to Lumina who own Cangrejos about 5km away with 20m Oz of the same type of mineralisation (see overview below). Could be a 30-40m oz AuEq project when combined.

Assume total tonnage by their numbers here is: 700x500x1000x2.6 = 910Mt. Grade - maybe .3-.4 g/t AuEq, with a 'high grade' core around 1 g/t.

And this is just one of the about 10 or so similar deposits on the project returning the same results.

MRE for GY-A and maybe GY-B (they've only been saying GY-A) in May. Hopefully on time.

 

[Sean K]

Watched the Webinar this afternoon, which was pretty depressing, to be honest.

KK went into some detail on the slide below in order to explain why the stock went from 38c to 11c over the past year or so and answered some tough questions submitted from shareholders which can be generally summarised as WTF?

If I was KK my truthful answer would have been, 'sorry, I ramped the crap out of this, continually comparing it to a DEG, but in the end, it's not what I ramped at all.'

They now have just one rig spinning in Argentina hoping to hit another Hualilan along strike. There's obviously more gold there due to all the artisanal work in the hills, but it'll just be good luck to hit anything decent.

They have just enough cash to get through to the Ecuador MRE and maybe a PEA for Argentina but then, they're broke. Hopefully Ecuador looks like it's going to be big enough for the guys next door to buy it off them so they can then spend another few million on drilling out Argentina to expand the resource and maybe find something else.

 

[Sean K]

They are reduced to rock chip sampling now because they have only one rig and very little cash left. Maybe they'll get some more money from the market if these chips could lead to something.

 

[Sean K]

RIU presentation out today, and it's looking pretty sad.

Even though they've dialled back the 10 or so rigs to just one and rock chipping with little kids hammers, they're still burning $3-4m a quarter which means a CR in the next few months. I see that on the back of an initial MRE just south of the equator. It better be good. If it surprises the market to the upside, I'll have to jag the spike and take my losings to the pub to console myself. What a turkey.

 

[Sean K]

This sort of drilling is going to help with the next CR.

Looks like these three blobs are going to turn into one giant open pittable deposit, and getting anything over 1g/t for a porphyry is very good. Over 1.5g/t is excellent.

Sounds like they might hold off on the MRE for GY-A/B in order to include C, but they haven't done enough drilling and don't have enough rigs to get that done quick enough IMO.

The MD's ramp about this being the 'other half of Cangrejos', may still come to fruition.

 

[The Triangle]

This sort of drilling is going to help with the next CR.

Looks like these three blobs are going to turn into one giant open pittable deposit, and getting anything over 1g/t for a porphyry is very good. Over 1.5g/t is excellent.

Sounds like they might hold off on the MRE for GY-A/B in order to include C, but they haven't done enough drilling and don't have enough rigs to get that done quick enough IMO.

The MD's ramp about this being the 'other half of Cangrejos', may still come to fruition.

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"This Company intends to report a maiden Mineral Resource Estimate in accordance with the JORC 2012 Code during May 2023"

That's all I'm interested in right now.

 

[Sean K]

"This Company intends to report a maiden Mineral Resource Estimate in accordance with the JORC 2012 Code during May 2023"

That's all I'm interested in right now.

If you've invested in it, let's both hope it's way above expectations.

 

[Sean K]

KK ramping about the investment into Lumina Gold, as mentioned above and beyond.

That's what he's after, and always has been. BUY ME!

 

[Sean K]

Two days to get the promised Ecuador MRE in. Call me sceptical, but I think it will be delayed. I hope not because I'm going away in June and I need to be on line at the open for when the resource is announced and the price spikes so I can bail on this turkey and lick my wounds.

 

[Sean K]

Two days to get the promised Ecuador MRE in. Call me sceptical, but I think it will be delayed. I hope not because I'm going away in June and I need to be on line at the open for when the resource is announced and the price spikes so I can bail on this turkey and lick my wounds.

Still no MRE. Terrible comms. Terrible. This happens a lot, but when you've promised so much and delivered so little, it's very frustrating. If the MRE is any good I guess there should be a TH while the company puts the polish on an announcement and potentially a presentation and a KK rampy video. I've got my fingers crossed that the Ecuador MRE does surprise to the upside and makes it obviously a sell-out to Lumina next door and perhaps a major who sees 30m ounces as a good long term stream...

 

[System]

On June 8th, 2023, Challenger Exploration Limited changed its name to Challenger Gold Limited.

 

[Sean K]

In TH for the MRE to be released on Thursday.

I think it might surprise to the upside and there will be a spike on volume before longer term holders who have lost quite a bit on paper decide to bail and redeploy the cash. Unless it's way over expected. Not sure what that could be as I've only been talking to myself on the potential tonnage as per previous rough calculations. The cartoons haven't been detailed enough with a block model and there's not enough drilling to have any confidence in the dimensions. It's going to be very inferred whatever it is.

Hopefully I'm in the right time zone when it opens and I can sell on the spike to unload this woofer.

Unless it looks like it's actually going to be "the other half of Cangrejos" which is 20Moz potential, then I might hang around.

 

[frugal.rock]

Initial Mineral Resource Estimate of 4.5 Moz gold-equivalent1 at
CEL's 100% owned El Guayabo Project, Ecuador and Completion
of $10 million Placement
Highlights

▪ Initial Inferred Mineral Resource Estimate (MRE) of 270 mt at 0.52 g/t AuEq1for 4.5 Moz AuEq1
at CEL's 100% owned El Guayabo Project in Ecuador (refer Table 1).

▪ The 4.5 Moz1 MRE contains a significant higher-grade core of mineralisation (refer Table 2):

▪ 1.45 Moz at 1.0 g/t AuEq1
(0.65 g/t AuEq cut-off) including;
▪ 1.01 Moz at 1.2 g/t AuEq1
(0.8 g/t AuEq cut-off) ) including;
▪ 0.63 Moz at 1.5 g/t AuEq1
(1.0 g/t AuEq cut-off).

▪ The MRE is predominantly based on drilling at the GY-A and GY-B anomalies and is constrained
by drilling with mineralisation remaining open in both directions along strike and at depth.

▪ MRE does not include drill holes GYDD-23-039 (805.3m at 0.6 g/t AuEq) or GYDD-23-040 to 043
(assays pending) and will be updated upon the receipt of assays for these final five holes.

▪ Discovery Cost of approximately US$1.202 per ounce.

▪ Transforms CEL into a two-project company with gold equivalent resources of 2.8 Moz4
in Hualilan and 4.5 Moz1
in Ecuador, both of which remain open.

▪ Firm commitments received to raise $10 million by way of an institutional placement, with
strong support received from domestic and offshore institutional investors

▪ Funds from the capital raising to be primarily applied to:
▪ Completion of a Pre-Feasibility Study (PFS) at CEL's Flagship Hualilan Gold Project;
▪ Regional exploration activities and drilling at Hualilan.

Commenting on the resource, CEL Managing Director, Mr Kris Knauer, said

“I would like to congratulate our Exploration team in Ecuador for this outstanding start. An initial
resource of 4.5 million ounces1
, particularly given its higher-grade core of 1.5 Moz at 1.0 g/t AuEq, is
a great start and has significant value in its own right.

It is, however, only our starting point. This resource is focused on 2 of the 7 targets at El Guayabo
that have produced mineralised intercepts greater than 500 metres. Mineralisation on these two
targets remains open in all directions along strike and at depth with the resource limited by a lack of drilling. Additionally, the final five holes in the program are yet to be included in the estimate which
will be updated when assays for these holes are received."

1 Reported as Gold Equivalent (AuEq) values – for requirements under the JORC Code see page 2
2 Discovery cost includes cost of drilling, assaying and all GA associated with the MRE

And the market sold on the news.