The current resource comprises a skarn component of 6.3 million tonnes grading 5.6 grams per tonne gold equivalent for 1.1 million ounces and 41.4Mt of intrusion/sediment hosted rock grading 0.8gpt gold equivalent for 1Moz.
"Importantly we have found significantly more high-grade skarn mineralisation than expected with it comprising more than half of this interim (resource)," Challenger said.
"Based on drilling since … we expect this trend of significantly more skarn to continue which will be major boost for the project."
Gold mineralisation reportedly strikes for 3.5km at Hualilan, with the current resource covering 2.2km of that extent.
Challenger started the current quarter with A$19.6 million cash.
It raised $42 million 12 months ago when it issued new shares priced at 28c each.
Shares in Challenger were up 4% to 27c in morning trade, capitalising the company at $271 million.
