Cangallo Copper Results from AusQuest Confirm Massive Discovery

AusQuest Limited (ASX: AQD) has delivered another set of exceptional Cangallo copper results from Ausquest Ltd from its 100%-owned Cangallo Porphyry Copper-Gold Project in Peru, with Stage 3 RC drilling confirming a massive 1,500+ metre copper corridor that remains open in multiple directions. Furthermore, the latest results demonstrate the truly large-scale nature of this discovery, with broad zones of continuous copper mineralisation extending over 400 metres in depth.

The standout result came from hole CANRC034, which intersected 164 metres @ 0.33% Cu and 0.07g/t Au from 304m to end of hole, including higher-grade zones of 54m @ 0.42% Cu and 26m @ 0.42% Cu. Importantly, the hole ended in mineralisation, indicating significant expansion potential to the south.

Major Copper Discovery Continues to Expand at Cangallo

The comprehensive drilling programme has confirmed the presence of a 1,500+ metre strike length × 250-500m width × 400m+ depth mineralised corridor. Consequently, this scale positions Cangallo among significant porphyry discoveries globally, with the system demonstrating characteristics typical of world-class copper deposits.

Key Metrics from Latest Results:

• Multiple high-grade zones: 15 intervals exceeding 0.5% Cu over 10+ metres
• 34 individual samples returned >0.8% Cu
• Oxide zone potential: Copper oxides extend 200-250m from surface, ideal for heap leaching
• Southern expansion: Increasing copper and gold grades toward southern drill sections

Management Commentary:
"We are very pleased with progress at Cangallo as the known footprint of copper mineralisation continues to expand the more we drill and remains open in multiple directions… The potential for higher copper grades in excess of 0.5% Cu within the mineralised system is also starting to emerge, which is an exciting development for the project." – Graeme Drew, Managing Director

Understanding Porphyry Copper Systems

For investors new to copper exploration, porphyry deposits represent the premier category of copper mining operations globally. In addition, these systems typically contain massive ore bodies that can support large-scale, long-life mining operations with favourable economics.

Key Characteristics of Porphyry Systems:

• Scale advantage: Usually contain over 1 billion tonnes of ore
• Open-pit mining: Generally suitable for low-cost surface mining operations
• Processing flexibility: Shallow oxide zones can utilise low-cost heap leach processing
• Extended mine lives: Often support 20-50+ years of continuous production
• Economic viability: Profitable at grades between 0.20-0.40% Cu in established mining jurisdictions

Heap Leaching Explained

This cost-effective processing method involves stacking copper ore and treating it with chemical solutions to extract copper. However, the approach requires significantly lower capital costs than traditional mills and can generate positive cash flow early in a project's development timeline.

Significant High-Grade Zones Within Broader System

Recent drilling has identified substantial 0.3%+ Cu zones within the broader mineralised envelope, with thicknesses ranging from 50-330 metres. Furthermore, this higher-grade material, much of which occurs in the oxide zone, represents strong potential for early heap leach operations.

Grade Trends and System Extension

The drilling programme has revealed increasing copper and gold grades toward the southern drill sections. Moreover, drill holes CANRC032 and CANRC034 both ended in mineralisation, providing strong evidence that the system extends well beyond current drill limits. This trend, supported by surface geochemical sampling, indicates substantial potential for system expansion.

What Makes the 2026 Drill Campaign So Aggressive?

AusQuest has outlined an ambitious drilling strategy designed to rapidly advance the Cangallo discovery toward resource definition:

Immediate Programme (March 2026)

• 5,000+ metre RC drilling programme commencing mid-March
• Focus on extending the copper corridor and testing southern extensions
• Collection of additional data for targeting higher-grade zones

Phase 2 Programme (April 2026)

• 5,000+ metre diamond drilling programme
• Targeting deeper, higher-grade hypogene sulphide mineralisation
• Testing depth extensions beyond current 400m+ intercepts to 800m+

Strategic Drilling Approach:

1. Define system boundaries through continued RC drilling
2. Target high-grade centres using geological vectoring
3. Test depth potential with diamond drilling programmes
4. Generate resource data for economic evaluation studies

Why Is Peru a Premier Global Copper Jurisdiction?

Peru ranks as the world's second-largest copper producer behind Chile, processing approximately 2.8 million tonnes annually. Consequently, the Cangallo Project benefits from exceptional infrastructure and jurisdictional advantages within this established mining region.

Infrastructure and Location Benefits

• 25km from Chala township – established regional service centre
• 10km from coast – proximity to ports and logistics infrastructure
• Low altitude operation – reduced operational complexities compared to high-altitude deposits
• Established mining district – proven regulatory and development pathways

Regional Operating Context:

The Arequipa District hosts numerous profitable large-scale porphyry copper operations, including established mines and advanced development projects. However, these operations demonstrate the commercial viability of porphyry systems within the district's geological and infrastructure framework.

Regulatory and Community Framework

AusQuest has maintained proactive community engagement throughout its exploration programmes, with no critical issues identified to date. In addition, Peru's supportive regulatory environment for responsible mining development provides additional confidence for project advancement pathways.

Investment Case: Scale, Location, and Development Optionality

World-Class Scale Potential

The Cangallo copper results from Ausquest Ltd demonstrate characteristics consistent with world-class porphyry systems. With drilling confirming a 1,500+ metre copper corridor that remains open in multiple directions, the project's scale potential continues to expand with each drilling phase.

Processing and Development Flexibility

The presence of extensive oxide copper mineralisation to 200-250m depth provides multiple development scenarios:

• Reduced capital requirements through heap leach processing options
• Faster development timelines compared to conventional mill operations
• Earlier cash flow generation potential for project funding
• Staged development approach enabling capital efficiency

Exploration Momentum and Value Catalysts

With over 10,000 metres of drilling planned for 2026, AusQuest is positioned to rapidly advance discovery definition. Furthermore, the combination of RC and diamond drilling programmes will provide comprehensive geological and economic data for:

• Complete system boundary mapping
• High-grade zone identification and targeting
• Depth extension confirmation and resource expansion
• Preliminary economic assessment preparation

Jurisdictional and Operational Advantages

Peru's position as a major global copper producer provides regulatory certainty and established infrastructure access. Moreover, the Arequipa District's successful porphyry development history offers proven pathways from discovery through to commercial production.

Key Investment Monitoring Points

Immediate Catalysts (2026)

1. March 2026: Commencement and results from 5,000m RC programme
2. April 2026: Diamond drilling programme targeting depth extensions
3. Mid-2026: Potential maiden resource estimate development
4. H2 2026: Stage 4 drilling programme testing system extensions

Strategic Positioning Factors

• 100% project ownership providing full exposure to discovery value
• Premium infrastructure location within established mining district
• Multiple processing scenarios enabling flexible development approaches
• Experienced management team with proven South American development expertise

The Cangallo Project represents a compelling combination of geological scale, jurisdictional advantages, and development optionality. As the drilling programmes advance through 2026, investors should monitor results closely as this discovery continues to demonstrate its potential significance within AusQuest's portfolio and the broader copper exploration sector.

For instance, the Cangallo copper results from Ausquest Ltd have established multiple near-term catalysts for continued discovery advancement. However, these exceptional results position the company as a significant player in global copper exploration, with Cangallo demonstrating world-class scale characteristics in an optimal mining jurisdiction.

Investment Perspective:
AusQuest has positioned itself as a significant player in global copper exploration, with Cangallo demonstrating world-class scale characteristics in an optimal mining jurisdiction. The planned 10,000+ metre drilling campaign for 2026, combined with increasing evidence of high-grade mineralisation zones, establishes multiple near-term catalysts for continued discovery advancement.

Could Cangallo Become AusQuest's Flagship Asset?

With over 10,000 metres of drilling planned for 2026 and a massive 1,500+ metre copper corridor that remains open in multiple directions, AusQuest Limited (ASX: AQD) is rapidly advancing what could become a world-class porphyry discovery. The combination of exceptional scale potential, premium Peruvian jurisdiction advantages, and multiple near-term drilling catalysts positions the company for significant value creation. To explore AusQuest's comprehensive project portfolio and understand how the Cangallo discovery fits within their broader exploration strategy, visit www.ausquest.com.au for detailed company information and the latest project developments.