(Hot Chili Limited, 3.Aug.2023) ) — Hot Chili Limited (ASX: HCH) (TSXV: HCH) (OTCQX: HHLKF) announced that drilling has re-commenced across the western extension of the Cortadera porphyry resource, part of the Company’s Costa Fuego Copper-Gold Project located 600 km north of Santiago, at low elevation (<1,000 m) in the coastal range of the Atacama Region, Chile.
Drilling operations have been underway for five days with one reverse circulation rig in operation and further diamond drill rigs to be added as the company ramps up its fully-funded 30,000m expansion drilling program across Costa Fuego.
Initial drill testing is focused on satisfying the company’s remaining 3,000m drill commitment with Antofagasta Minerals (see announcement dated 28 November 2022) to acquire key leases lying along the western extension of Cortadera.
Drilling is also planned to test several porphyry targets at Cortadera and within the company’s consolidated landholdings, in addition to remaining required development study drilling.
Given the company’s significant advance on its Pre-Feasibility Study for Costa Fuego (over 80% complete) and high Indicated categorisation of the current Mineral Resource (82% Indicated), the majority of planned drilling is being directed toward exploration and mineral resource growth.
Cortadera is the centre-piece of Costa Fuego, with the Indicated Mineral Resource for Costa Fuego currently standing at 725 Mt grading 0.47% CuEq1 for 2.8 Mt copper (Cu) and 2.6 Moz gold (Au) and the Inferred Mineral Resources comprising 202 Mt grading 0.36% CuEq1 for 0.6 Mt Cu and 0.4 Moz Au (see page 9 for complete mineral resource disclosure, including breakdown by metal).
Costa Fuego is one of the world’s lowest capital intensity major copper developments (see announcement dated 28 June 2023, entitled “Hot Chili Announces PEA2 for Costa Fuego”), and is one of only a handful of projects outside of the control of major miners that is capable of delivering meaningful new copper supply this decade.
The company’s recently announced Preliminary Economic Assessment (“PEA”)2 establishes Costa Fuego as a low-risk, long life copper project benefiting from a low start-up capital and a high annual copper equivalent metal production profile of over 100 kt for a 16-year mine life, including 95 kt Cu and 49 koz Au during primary production (first 14 years) at C1 Cash Cost3 of US$1.33/lb (estimated net of by-product credits).
Hot Chili is focussed on up-scaling Costa Fuego’s resource base and potential study scale towards a 150,000 tpa copper production profile ahead of the delivery of the Costa Fuego Pre-Feasibility Study (“PFS”), expected in H2 2024.
A mineral resource update for Costa Fuego is planned to be completed in H2 2023 and will include drilling from the current 30,000m programme as well as significant drilling undertaken across Costa Fuego since the beginning of 2022.
The company is well funded with approximately A$26mn in treasury following closing of its recent investment agreement with Osisko Gold Royalties for US$15mn (as announced 26 July 2023).
A PEA technical report prepared in accordance with NI 43-101 (as defined below) will be filed on SEDAR+ by 11 August 2023.