Key operational outcomes from the prefeasibility study for Challenger Gold's (ASX:CEL) Hualilan gold project in Argentina confirm the project as a large‐scale, technically straightforward development with a long mine life, Euroz Hartleys said in a note on Monday.

The planned dual‐path processing strategy provides strong flexibility, with a 1.5 million tonnes-per-annum flotation plant recovering around 1.2 million ounces of gold from higher‐grade ores over 12 years, complemented by an 8 million tonnes-per-annum heap‐leach circuit from the first year, adding around 500,000 ounces of gold.

Both plants are expected to produce gold and silver doré, and overall, the project targets recovery of over 1.8 million ounces of gold equivalent over the mine life.

The initial heap‐leach production delivers around 105,000 ounces-per-annum of gold equivalent over the first two years, generating cash flow to fund the flotation plant and significantly reducing upfront capex and execution risk, per the note.

The investment firm retained its speculative buy rating on Challenger Gold and raised the price target to AU$0.40 per share from AU$0.39 per share.