Challenger Gold Lines Up US$30.3 Million in Convertible Debentures to Advance Hualilán Toward Mid-2027 Full Financing

Aditi Sarkar

29 October 2026 01:31 PM AEDT

Challenger Gold Lines Up US$30.3 Million in Convertible Debentures to Advance Hualilán Toward Mid-2027 Full Financing

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Highlights

Challenger Gold signed commitments for US$30.3 million of five-year convertible debentures, with the first tranche of US$18 million completed on 23 October 2026.
Pro forma cash and liquid investments reached about A$75.4 million following the new debentures, providing stated runway to mid-2027 for full Hualilán project financing.
The May 2026 pre-feasibility study outlines a US$1.45 billion pre-tax NPV at US$3,500 per ounce gold, with a 14.25-year mine life and 1.84 million ounce production target.
A general meeting targeting late November 2026 is required to approve the second tranche of US$12.3 million, which includes US$9.3 million from related-party affiliates.

Challenger Gold (ASX:CEL) has structured its bridge to a fully funded Hualilán development decision. Commitments for US$30.3 million of new convertible debentures — with US$18 million already landed in a first tranche — are designed to carry the company through mid-2027, when it is targeting full project financing for the Argentine gold development that its pre-feasibility study values at US$1.45 billion pre-tax. The raise also came with a repayment of an earlier maturing debenture, meaning Challenger has simultaneously cleared existing obligations and added fresh runway.

The Debenture Financing

The new debentures are unsecured, carry a five-year maturity and an 11% annual coupon — split 6.5% payable in cash and 4.5% payable in cash or shares at the investor's election — and convert into shares at an initial price of A$2.72 per share. During the quarter, the company repaid a maturing US$15 million convertible debenture, removing that obligation from its capital structure.

The first tranche of US$18 million was completed on 23 October 2026. The remaining US$12.3 million — including US$9.3 million from affiliates of related parties — is conditional on shareholder approval at a general meeting Challenger is targeting for late November 2026. Until that approval is obtained, the second tranche should be treated as proposed rather than received, and the full US$30.3 million is not yet in hand.

Pro Forma Cash and Runway to Mid-2027

Cash and liquid investments at 30 September 2026 were A$34.6 million, comprising A$25.8 million in cash and A$8.8 million in mutual funds. Including the new debenture proceeds, the company presents a pro forma position of approximately A$75.4 million and states this should fund activities to mid-2027 — when it is targeting full Hualilán project financing.

Quarterly expenditure was approximately A$27.6 million. Administration and corporate costs rose to A$2.4 million from A$1.4 million in the prior quarter. Related-party payments for the quarter were A$579,109 in director fees, A$38,541 in administration reimbursement and A$99,116 for geological consulting services, all disclosed under Appendix 4C requirements.

Hualilán Pre-Feasibility Study

The May 2026 pre-feasibility study for Hualilán was run at a US$3,500 per ounce gold price and outlines a single open pit feeding an 8 million tonne per annum heap leach facility and a 1.5 million tonne per annum flotation plant. The study reports a 14.25-year mine life, a production target of 1.84 million gold-equivalent ounces, a pre-tax NPV at a 5% discount rate of US$1.45 billion, and life-of-mine all-in sustaining costs of US$1,618 per payable ounce.

Plant and infrastructure capital is put at US$203 million, with a further US$64 million of pre-production mining capital. The production target is underpinned by approximately 78.8% Probable Ore Reserves and approximately 21.2% Inferred Resources. The company cautions that the Inferred portion needs further evaluation before inclusion in a reserve. The total Mineral Resource for Hualilán stands at 132.1 million tonnes for 2.735 million ounces.

Ecuador Review and Upcoming Milestones

In Ecuador, Challenger has withdrawn the proposed divestment of El Guayabo and Colorado V and started a technical and strategic review. The combined 100% resource for the Ecuador assets is 570 million tonnes for 9.1 million ounces of gold equivalent, predominantly Inferred, with 6.9 million ounces attributable to Challenger. The review will inform whether to advance, partner or transact.

Key milestones ahead include the late-November 2026 shareholder meeting for second tranche approval, a 35,000-metre Hualilán drilling programme update in Q4 2026, updated resource and reserve estimates in the second half of 2027, full project financing by mid-2027, and first heap-leach production targeted for early 2029.

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