Costa Fuego’s 3.62 Mt CuEq Indicated Resource Grows with La Verde Porphyry Discovery

A Breakthrough Discovery at La Verde

Hot Chili Limited (ASX: HCH) has announced a major copper-gold porphyry discovery at its La Verde prospect, part of the broader Costa Fuego project in Chile. The discovery drillhole DKP002 returned an impressive 308 metres grading 0.5% copper and 0.3 g/t gold from just 46 metres downhole, including higher-grade intervals of 202 metres at 0.6% copper and 0.3 g/t gold. This wide, shallow mineralisation footprint, currently extending 550 by 400 metres and open in all directions, signals a potentially transformative addition to Hot Chili’s resource base.

The ongoing drilling campaign, comprising 5,700 metres across nineteen holes, is testing lateral and depth extensions, with several holes finishing strongly at depth, suggesting further upside potential. Surface mapping and geophysical surveys indicate a larger mineralised system concealed beneath shallow gravel cover, with look-alike targets identified for future exploration.

Costa Fuego: A Tier-One Copper-Gold Asset

The Costa Fuego project now boasts an indicated mineral resource of 798 million tonnes grading 0.45% copper equivalent, containing approximately 3.62 million tonnes of copper, 2.64 million ounces of silver, 2.91 million ounces of gold, and 68,100 tonnes of molybdenum. Over 85% of this resource is classified as indicated, providing a solid foundation for advancing development studies.

Strategically located at a low elevation of around 740 metres above sea level, Costa Fuego benefits from proximity to key infrastructure including the Pan American Highway and a port just 50 kilometres away. The project has secured a maritime water concession and power connection, mitigating two of the most significant risks in Chilean mining: water access and energy supply.

Advancing Toward Development

Hot Chili is in the final stages of completing pre-feasibility studies (PFS) for both the Costa Fuego project and its associated Huasco Water infrastructure initiative. The Environmental Impact Assessment (EIA) application is being prepared for submission, reflecting the company’s commitment to responsible permitting and ESG standards.

The company’s approach leverages existing infrastructure to reduce capital intensity and environmental footprint, avoiding the need for costly desalination plants or high-altitude water pipelines. This positions Costa Fuego competitively on the cost curve and aligns with global sustainability trends, particularly given copper’s critical role in the green energy transition.

Strategic Partnerships and Market Positioning

Hot Chili maintains strong relationships with key stakeholders, including a memorandum of understanding with Puerto Las Losas for port services and an offtake agreement with Glencore, which can purchase up to 60% of concentrate during the first eight years of mine life. The company’s capital structure and shareholder base include significant institutional and strategic investors, underpinning its financial position with A$19 million cash on hand as of December 2024.

With copper and gold prices near historic highs, and global supply deficits looming due to declining grades and limited new discoveries, Costa Fuego’s large-scale, low-cost resource offers compelling exposure to critical commodities essential for electrification and decarbonisation efforts worldwide.

Looking Ahead

Hot Chili’s discovery at La Verde not only expands the resource footprint but also validates the company’s long-term exploration strategy in Chile’s prolific copper belt. As drilling continues and studies progress, the potential to scale production beyond the current 95 ktpa copper equivalent outlined in the preliminary economic assessment (PEA) toward 150 ktpa and a mine life exceeding 20 years is increasingly tangible.

Investors and analysts will be watching closely as Hot Chili advances its permitting, finalises feasibility studies, and explores further resource growth opportunities, all while navigating the complex regulatory and market environment in Chile.