Hot Chili’s Funding Boost Hinges on Environmental Approval and Partner Deals

Strong Capital Raise Signals Confidence

Hot Chili Limited (ASX, HCH) has successfully secured A$40 million from a private placement, attracting strong demand from Australian, Canadian, and international institutional investors, including its three largest shareholders. The placement, priced at A$1.65 per share, was oversubscribed, reflecting robust market confidence in Hot Chili’s strategy amid a rising copper price environment.

Managing Director Christian Easterday highlighted the significance of the funding, noting it positions the company to aggressively advance its La Verde copper-gold discovery within the broader Costa Fuego project. The capital injection supports an accelerated drilling program aimed at expanding the mineral resource and delineating a potential higher-grade starter pit, which could materially improve the project’s financial metrics and reduce capital payback periods.

Advancing Feasibility and Environmental Approvals

The funds will underpin an expanded feasibility study integrating La Verde into Costa Fuego’s open-pit development schedule. This study aims to deliver key milestones by 2026, including the submission of an Environmental Impact Assessment (EIA) for the project’s development hub. The EIA submission is a critical regulatory step, enabling Hot Chili to seek approval for an annual production target of 100,000 tonnes of copper and 50,000 ounces of gold.

Alongside feasibility and environmental work, the company plans to continue exploration drilling on adjacent porphyry targets, potentially expanding the resource base further. Hot Chili is also progressing the Huasco Water Project, essential for sustainable mine operations, and evaluating strategic funding options with several non-binding offers under consideration.

Strategic Partnering and Market Timing

Hot Chili is actively engaged in strategic partnering processes to bring in additional technical and financial expertise to support project delivery. The company has appointed BMO Capital Markets as financial adviser for these initiatives, which remain ongoing and may lead to various transaction outcomes. While no binding agreements have yet been reached, the strong investor interest and placement success underscore the market’s appetite for copper assets positioned to benefit from supply constraints and rising demand.

Easterday emphasised that the timing of this capital raise aligns with a supply-driven copper market cycle, positioning Hot Chili to become a meaningful supplier over the coming decade. The company’s focus on a higher-grade starter pit at La Verde is designed to enhance project economics and accelerate value creation for shareholders.

Looking Ahead

With the placement completed, Hot Chili is well-funded to deliver on its near-term development milestones. The coming months will be critical as drilling results emerge, the feasibility study progresses, and environmental approvals are pursued. The company’s ability to secure strategic partners and navigate regulatory processes will be key determinants of its path to production.