Hot Chili Limited secured A$40 million in a private placement to fast-track development of its Costa Fuego copper-gold project in Chile, buoyed by significant high-grade drill results extending the La Verde discovery footprint.
- A$40 million private placement oversubscribed
- La Verde drill hole DKD039 hits 725m at 0.42% CuEq
- Higher-grade starter pit zone defined near surface
- Ausenco appointed to lead Costa Fuego feasibility study
- Strong cash position of A$35.2 million with no debt
Capital Raise Fuels Rapid Project Advancement
Hot Chili Limited (ASX:HCH) has bolstered its war chest with a A$40 million private placement, attracting strong demand from institutional investors across Australia, Canada, and overseas, as well as major shareholders including Glencore, Blue Spec, and GS Group. This injection is earmarked to accelerate key milestones at the Costa Fuego copper-gold project in Chile, including the delivery of a maiden Mineral Resource at the La Verde discovery, integration into an expanded mine plan, and the completion of an Environmental Impact Assessment (EIA).
The capital raise, involving over 24 million shares issued on both the ASX and TSXV, positions Hot Chili to push forward with feasibility studies and drilling programs, underpinning its ambition to become a significant copper supplier in the coming decade. As of 31 March 2026, the company holds a robust cash balance of A$35.2 million with zero debt, providing a solid financial foundation for these development activities.
Drilling Results Extend High-Grade Copper-Gold Footprint
The La Verde porphyry discovery continues to deliver compelling drill results, with diamond drill hole DKD039 intersecting an impressive 725 metres grading 0.42% copper equivalent (CuEq) from just 18 metres below surface. This includes a standout 62 metres at 1.03% CuEq from 671 metres depth, confirming a major down-dip extension of the high-grade core. These results effectively double the depth extent of mineralisation to 800 metres and expand the high-grade core laterally and towards surface.
Near-surface drilling has delineated a 450 by 400 metre zone of higher-grade mineralisation, with thirteen significant intersections above 0.6% CuEq within 250 metres of surface. Notable recent intercepts include 150 metres at 0.52% CuEq from 30 metres depth and 220 metres at 0.47% CuEq from 38 metres, highlighting a potential higher-grade starter pit that could improve project economics by shortening payback periods and enhancing key financial metrics.
This drilling momentum is supported by the deployment of two diamond drill rigs, with a third expected to join soon to accelerate resource definition. The company's approach leverages targeting strategies successfully applied at its nearby Cortadera project, aiming to replicate growth at La Verde. Pending assays from thirteen drill holes promise further insights into the mineralisation continuity and scale.
Ausenco to Lead Feasibility Study Execution
To translate these exploration successes into a viable mining operation, Hot Chili has appointed global engineering firm Ausenco to lead the Feasibility Study for Costa Fuego. Ausenco’s track record includes the engineering, procurement, construction, and ramp-up of the Mantoverde coastal copper project in Chile, a similar scale operation that aligns well with Costa Fuego’s development profile.
The feasibility work will integrate La Verde’s maiden Mineral Resource and focus on optimizing mine planning, environmental approvals, and infrastructure development. This appointment follows a thorough review of major engineering firms in Chile, underscoring the company’s commitment to rigorous project execution.
Strategic Partnering and Project Funding Progress
Hot Chili continues to advance its strategic Partnering Process, seeking collaborators with the financial and technical capacity to support project funding and delivery. Engagement levels have remained strong, with multiple parties progressing through due diligence and site visits. The company has received several non-binding and conditional proposals, reflecting market interest in Costa Fuego’s potential.
While there is no certainty that these discussions will culminate in binding agreements, the process aims to diversify funding options beyond equity raises, including debt financing, asset sales, and royalty or streaming arrangements. BMO Capital Markets remains the financial adviser guiding this process.
Operational and Safety Update
Field operations during the quarter focused on geological reconnaissance, diamond drilling, and sampling across Costa Fuego, particularly at La Verde. The company reported a single Lost Time Injury (LTI) related to accidental contact with damaged core trays, reflecting ongoing attention to health and safety protocols. Hot Chili’s sustainability framework prioritizes long-term economic, environmental, and social value, with continuous monitoring and improvements to safety and environmental systems.
Meanwhile, the company’s tenement portfolio underwent some adjustments with expirations and abandonments of certain concessions, but the core holdings at Cortadera, Productora, Domeyko, and San Antonio remain intact and active for exploration and development.
Hot Chili’s latest quarterly report also includes comprehensive technical data and a detailed cash flow statement, showing operating expenditure aligned with exploration and development goals. The company’s strong cash position and active drilling program set the stage for further resource growth and project advancement.
These developments build on the company’s earlier major high-grade extension at La Verde and follow a series of funding rounds including the A$40M private placement oversubscribed, positioning Hot Chili well for the next phase of its Costa Fuego journey.
Bottom Line?
Hot Chili’s fresh capital and expanding La Verde resource underpin a critical phase of feasibility and development, but upcoming assay results and strategic partner outcomes will be pivotal.
Questions in the middle?
- How will pending assay results from multiple drill holes reshape the La Verde resource model?
- What terms and structure might emerge from Hot Chili’s ongoing strategic Partnering Process?
- Can Ausenco’s feasibility study deliver a development plan that balances scale with capital discipline?