Hot Chili’s La Verde copper-gold discovery has expanded rapidly enough to become a cornerstone of the Costa Fuego project, while new funding gives the company room to pursue the next studies and permits. The key test now is whether drilling can translate into a maiden resource and a credible development case.
- La Verde mineralisation extended to 800 metres from surface
- 725 metres at 0.42% CuEq and 391 metres at 0.51% CuEq
- A$75 million-plus raised through equity and royalty funding
- Cash increased to approximately A$46 million with no debt after year end
- Maiden resource, revised PFS and environmental submissions are next milestones
La Verde moves to the centre of Costa Fuego
Hot Chili Limited (ASX:HCH) has spent the year turning La Verde from a promising copper-gold discovery into the proposed front end of its Costa Fuego development strategy. Drilling extended mineralisation to 800 metres from surface and outlined a near-surface, higher-grade zone that the company says could support a potential starter pit. That remains a conceptual opportunity rather than a defined mine plan, but it has materially changed the role La Verde plays in the project.
The standout result was diamond hole DKD039, which returned 725 metres at 0.42% copper equivalent from 18 metres, including 62 metres at 1.03% CuEq. Hole DKD044 added 391 metres at 0.51% CuEq from surface. The company completed almost 30,000 metres of drilling by July, with the program expanding from one diamond rig in September 2025 to three rigs by May 2026.
Those results sit alongside a growing shallow zone. Hot Chili reported a broad area of higher-grade mineralisation, including a +0.6% CuEq zone from surface to 250 metres across roughly 450 metres by 400 metres, with subsequent holes returning further intervals above 0.7% CuEq. The practical attraction is obvious: mineralisation beginning at or near surface could, if confirmed through resource and study work, support earlier access to higher-grade material. The filing does not yet establish that outcome.
Funding buys time for studies and permitting
Hot Chili raised A$14.1 million through an entitlement offer and A$40 million through a private placement during the year. Shortly after 30 June, it secured another US$15 million, approximately A$21.4 million, from OR Royalties in exchange for an expanded net smelter return royalty covering La Verde. The company said the arrangement lifted total consideration under the OR royalty structure to US$30 million.
Cash stood at A$24.9 million at 30 June, with no debt, and was reported at approximately A$46 million after the post-year-end royalty transaction. The balance sheet is therefore better placed for the next work program, although Hot Chili remains an exploration and development company spending heavily ahead of revenue. It recorded an attributable loss of A$10.1 million for the year and used A$8.4 million in operating cash, while exploration and evaluation expenditure carried on the balance sheet rose to A$262.5 million.
Resource, PFS and EIA milestones define the next stage
The immediate catalyst is a maiden Mineral Resource Estimate for La Verde, expected later in calendar 2026. That is intended to feed into a revised Costa Fuego Pre-Feasibility Study incorporating the discovery and assessing development options at Cortadera, including a potential large open-pit scenario. Ausenco has been appointed as lead engineering group, while Hot Chili has created a dedicated project development team led by project director David Bayona.
Permitting is advancing on a parallel track. Hot Chili plans to submit the Costa Fuego Environmental Impact Assessment in the second quarter of 2027, while the Huasco Water EIA is scheduled for the end of 2026. The company has split the environmental process into separate assessments for the seawater intake and distribution system, and for the initial Costa Fuego mining development. A second maritime licence application for desalination remains in the Chilean regulatory process after delays linked to a change of government.
The filing also says Hot Chili is pursuing strategic partners for Costa Fuego and Huasco Water, with several parties progressing through due diligence and site visits. There is no certainty that the process will produce a transaction. That caveat matters: the company has secured exploration funding, but the much larger financing requirement for mine construction remains ahead, alongside permitting, engineering, commodity-price and execution risks.
Bottom Line?
La Verde has supplied the growth story; the maiden resource and revised PFS must now show how much of that story survives contact with mine planning and economics.
Questions in the middle?
- Will the maiden La Verde resource confirm enough tonnage and grade to support the proposed starter-pit concept?
- How will the revised Costa Fuego PFS change capital intensity, operating metrics and the development timetable?
- Can Hot Chili secure a strategic partner on terms that preserve flexibility while funding the project beyond the current exploration phase?