Hot Chili Signs Three-Year Option Agreement for La Verde Copper Mine

Strategic Expansion with La Verde Acquisition
Hot Chili has entered a three-year option agreement to acquire 100% ownership of the historic La Verde copper mine, located in the core of Chile’s Domeyko mining district, just 30 km south of its flagship Costa Fuego copper-gold project. The acquisition represents a key step in Hot Chili’s growth strategy to enhance its copper-gold assets. By consolidating the entire La Verde porphyry system under single ownership, Hot Chili aims to unlock the potential for further exploration and development of a larger porphyry copper deposit.

The La Verde project is now situated at the heart of Hot Chili’s expanded Domeyko landholding, which was secured earlier in 2024. This consolidation creates new opportunities for comprehensive drill testing and could significantly extend the life and scale of Costa Fuego’s planned production hub.

Exploration and Drilling Activities Underway
Since signing the option agreement, Hot Chili has intensified exploration in the region, including soil geochemistry, geological mapping, and magnetic surveys. These efforts have extended into the La Verde mine area as part of the due diligence process for the acquisition. Preliminary geological mapping within the open pit has identified significant copper oxide mineralisation associated with porphyry-style quartz veins, fractures, and faults.

On October 30, 2024, Hot Chili launched an initial drilling program at La Verde, which includes 11 RC drill holes totaling 4,000 meters. As of now, two drill holes totaling 800 meters have been completed. While assay results are pending, the visual inspection suggests promising porphyry-style copper mineralisation, which could significantly enhance the project’s value.

Option Agreement Terms and Financial Commitments
The terms of the Option Agreement for La Verde involve a series of non-refundable cash payments to SLM Dominiceros, the current holder of the La Verde concession. These payments are structured as follows:

• An initial payment of $320,000 upon signing
• A subsequent payment of $680,000 due within 12 months
• Another payment of $1 million due within 24 months
• A final payment of $6.89 million due within 36 months, upon the exercise of the option.

Strengthening Costa Fuego and Regional Growth
This acquisition is a crucial part of Hot Chili’s strategy to expand and consolidate resources in the Domeyko region, directly enhancing its Costa Fuego project. By adding La Verde, Hot Chili aims to increase both bulk tonnage and high-grade copper-gold resources, thereby boosting the economic viability of the Costa Fuego hub. The company is also progressing with key technical and environmental studies, including a Prefeasibility Study (PFS), an Environmental Impact Statement (EIA), and regional drilling programs.

Hot Chili maintains a strong financial position with A$25.7 million in cash (as of September 2024), positioning it well for ongoing development of its projects and to complete the Costa Fuego Prefeasibility Study.