Hot Chili Limited

Hot Chili Announces PEA for Costa Fuego

Hot Chili Limited (ASX: HCH) (TSXV: HCH) (OTCQX: HHLKF) (“Hot Chili” or “Company”) is pleased to announce the results of the Preliminary Economic Assessment (the “PEA”) for its Costa Fuego Copper-Gold Project (Costa Fuego or “the Project”) located 600 km north of Santiago, at low elevation (<1,000 m) in the coastal range of the Atacama Region, Chile. The PEA was prepared in accordance with Canada’s Standards of Disclosure for Mineral Projects (“NI 43-101”).


Costa Fuego Copper-Gold Project Preliminary Economic Assessment (PEA)1 Outlines One of the World’s Lowest Capital Intensity, Major Copper Developments

  • Strong Economics: Costa Fuego PEA delivers using an 8% discount rate and long-term metal price assumptions of US$3.85/lb copper (Cu) and US$1,750/oz gold (Au):
    • Base-case post-tax Net Present Value (NPV8%) of US$1.10 Billion (approximately, within a range of US$733 Million to US$1.46 Billion) and Internal Rate of Return (IRR) of 21% (approximately, within a range of 17% to 25%)
    • Base-case pre-tax Net Present Value (NPV8%) of US$1.54 Billion (approximately, within a range of US$1.05 Billion to US$2.03 Billion) and Internal Rate of Return (IRR) of 24% (approximately, within a range of 19% to 29%)
  • Low Start-up Capital: US$1.05 Billion estimated, resulting in fast 3.5-year payback. Initial phases of open pit mining fully fund development of a bulk underground operation
  • Low Capital Intensity: One of the lowest capital intensities of global copper development projects
  • Approximately 112 ktpa Average CuEq2 Production Rate: Including 95 kt Cu and 49 koz Au during primary production (first 14 years) at C1 Cash Cost3 of US$ 1.33/lb (estimated net of by-product credits)
  • Initial Mine Life: 16-years with 1.41 Mt Cu and 718 koz Au produced for total revenue of approximately US$13.52 Billion and total free cash flow of approximately US$3.28 Billion (post-tax, after operating costs, capital costs, and royalties)
  • Conservative Approach: 20% contingency on capital and US$3.30/lb copper price for optimisations
  • Low Elevation with Advanced Permitting: One of only a few global copper development projects at low elevation with a water permit and power connection
  • Highly Leveraged to Copper Price: For every US$0.10/lb increase above US$ 3.85/lb Cu price, US$100 Million (approximately) is added in post-tax NPV8%
  • Resource Growth Potential: 30,000 m drilling program set to commence across multiple targets
  • Pre-Feasibility Study (PFS) Planned for Release by H2 2024: 80% of workstreams to support a PFS are completed, with minimal study costs remaining
  • Single, Large Pit Scenario for Cortadera: Being studied in H2 2023, with potential to materially increase mine life and scale

Hot Chili’s Managing Director Mr Christian Easterday commented, “The Costa Fuego PEA cements Hot Chili’s position as the largest copper developer listed on the ASX by both resource size and potential scale of copper production.

Costa Fuego ranks highly amongst global peer projects1 and stands out as one of the world’s lowest capital intensity, major copper developments. The PEA indicates a strong investment case for advancing Costa Fuego to a PFS for what would be a low-cost, low-risk, long-life, large-scale copper project, which is extremely leveraged to both resource growth and copper price appreciation.

I am very pleased with our entire teams’ effort to deliver the PEA on-time and within guidance and look forward to delivering on our objective to transform Hot Chili into the only 100 thousand tonne copper producer listed on the ASX outside of the control of major miners.

We are focused on our next steps in resource growth and the delivery of an optimised and potentially larger project definition for our pre-feasibility study next year.

The recently announced US$15 Million investment agreement with Osisko Gold Royalties positions the Company to be fully funded for the next 12 to 18 months to deliver on our growth and development timetable.”

Chairman Nicole Adshead-Bell affirmed, “Hot Chili is now one of a select group of companies with a copper development project of this scale of production that is not controlled by a major. The Company is also advantaged by its coastal, low elevation location and abundant existing infrastructure, reducing its economic hurdle and resulting in the lowest capital intensity of its global peer projects.

Our decade long efforts on decreasing development risk, including acquiring water rights, surface rights and securing connection to the electrical grid, will materially reduce development timelines when we make the decision to advance the Project through final permitting.

Hot Chili is very well positioned to benefit from the looming structural shortfall in copper production1 due to the size and scale of the Project. Combined with the ability to more quickly advance to production when compared to some of our development peers, due to our 10-year long commitment to reducing exogenous risk combined with the strong ESG credentials of Costa Fuego”.

Chief Operating Officer Grant King further added, “The PEA outlines for the first time - a combined production hub approach for Costa Fuego, utilising centralised processing for open pit and underground production sources.

We have taken a conservative approach in the PEA - Twenty percent contingency has been applied to all capital costs, Mineral Resources are reported at US$3.00/lb copper price, mining optimisations were undertaken at US$3.30/lb copper price and financial modelling at US$3.85/lb copper price, with closure costs included.

Our PFS is well advanced and awaiting the outcome of further resource growth activities before finalising study scale. We will also investigate a large single open pit scenario for Cortadera (no underground block cave) with the potential to materially increase processing feed and mine life.”

The company will be hosting webinars on 29th June at 9.30 am AEST / 7.30 am AWST (for Australian audience) and at 10.00 am EST (for North American audience) to brief shareholders and investors on the outcomes of the Costa Fuego PEA.

Hot Chili’s Chief Executive Officer Christian Easterday and Chief Operating Officer Grant King will be hosting the call, which will also include a Q&A session.

The following links will provide access to the Costa Fuego investor briefing webinar:

Registration Link for Australian Audience - 29th June at 9.30 am AEST / 7.30 am AWST

Registration Link for North American Audience – 29th June at 10.00 am EST

After registering, you will receive a confirmation email containing information about joining the webinar.


Click here for the full ASX Release

This article includes content from Hot Chili Limited, licensed for the purpose of publishing on Investing News Australia. This article does not constitute financial product advice. It is your responsibility to perform proper due diligence before acting upon any information provided here. Please refer to our full disclaimer here.

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Hot Chili Limited

Appointment of New Canadian Director

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Hot Chili Limited (ASX: HCH) (TSXV:HCH) (OTCQX: HHLKF) ("Hot Chili" or "Company") is pleased to announce that the Company proposes to appoint experienced mining executive, Mr Stephen Quin, to the Board of Hot Chili as an independent Non-Executive Director.

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Hot Chili Limited

Further Consolidation of Cortadera

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Cortadera Porphyry Footprint Continues to Expand

· Hot Chili has succeeded in securing several new prospective mining rights, adjacent to mining rights in the recently announced transaction with Antofagasta Minerals S.A. (AMSA)

** Copper Equivalent (CuEq) reported for the drillhole intersections were calculated using the following formula: CuEq% = ((Cu% × Cu price 1% per tonne × Cu_recovery) + (Mo ppm × Mo price per g/t × Mo_recovery) + (Au ppm × Au price per g/t × Au_recovery) + (Ag ppm × Ag price per g/t × Ag_recovery)) / (Cu price 1% per tonne × Cu_recovery). The Metal Prices applied in the calculation were: Cu=3.00 USD/lb, Au=1,700 USD/oz, Mo=14 USD/lb, and Ag=20 USD/oz. The entirety of the intersection is assumed as fresh. The recovery and copper equivalent formula for Cortadera – Recoveries of 83% Cu, 56% Au, 83% Mo and 37% Ag. CuEq(%) = Cu(%) + 0.56 x Au(g/t) + 0.00046 x Mo(ppm) + 0.0043 x Ag(g/t)

Hot Chili Limited (ASX: HCH) (TSXV:HCH) (OTCQX: HHLKF) ("Hot Chili" or "Company") is pleased to announcefurther consolidation of the Cortadera copper-gold discovery in Chile.

The Company has succeeded in securing several new prospective mining rights at a recently held, government-run, public auction for the Huasco region of Chile. The new mining rights are located alongside mining rights of the recently announced (25 th November 2022) transaction with Antofagasta Minerals S.A. (AMSA).

Together, these new landholdings consolidate the western extension of Cortadera and allow Hot Chili to test a potentially much larger copper porphyry cluster.

Hot Chili has now secured four new large porphyry targets adjacent to the existing Cortadera resource (Cuerpo 1, 2 and 3), and added significant prospective strike length across two mineralised trends:

· Las Canas trend (+1.8km, N-S) - Three large porphyry targets including the Cuerpo 4 porphyry target (700m in strike length by 300m in width and drill confirmed, see announcement dated 25 th November 2022 for details of AMSA transaction)

· Cortadera trend (+1.1km, NW-SE) – One large porphyry target located directly along-strike from Cortadera on the Serrano fault, an important mineralising fault corridor connecting the Cortadera and Productora copper-gold deposits

The new landholding successfully acquired at auction contains the Cortadera trend extension and comprises seven mining rights covering 757 hectares. Three mining rights (Falla Maipo 2, 3, 4) were acquired for US$110,000 and the remaining four mining rights (CF 6, 7, 8, 9) were successfully awarded following forfeiture of overlapping third party mining rights.

Figures on the following pages outline the location of the new mining rights in relation to Cortadera.

Drilling across the western extension to Cortadera is planned to commence as soon as possible.

This recent strategic consolidation of the Cortadera porphyry deposit area has the potential to deliver another significant leg of resource growth to the Costa Fuego copper hub.

Further updates and announcements are expected in the lead-up to drill commencement.

Figure 1. Location of new mining rights(AMSA) relating to Cortadera, Productora, San Antonio, Valentina and nearby coastal range infrastructure of Hot Chili's combined Costa Fuego copper-gold project, located 600km north of Santiago in Chile.

* Copper Equivalent (CuEq) reported for the resource were calculated using the following formula: CuEq% = ((Cu% × Cu price 1% per tonne × Cu_recovery) + (Mo ppm × Mo price per g/t × Mo_recovery) + (Au ppm × Au price per g/t × Au_recovery) + (Ag ppm × Ag price per g/t × Ag_recovery)) / (Cu price 1% per tonne × Cu_recovery).

The Metal Prices applied in the CuEq calculation were: Cu=3.00 USD/lb, Au=1,700 USD/oz, Mo=14 USD/lb, and Ag=20 USD/oz. Metallurgical recovery averages for each deposit consider Indicated + Inferred material and are weighted to combine sulphide flotation and oxide leaching performance. The recovery and copper equivalent formula for each deposit is:

Cortadera and San Antonio – Weighted recoveries of 82% Cu, 55% Au, 82% Mo and 37% Ag.

CuEq(%) = Cu(%) + 0.56 x Au(g/t) + 0.00046 x Mo(ppm) + 0.0043 x Ag(g/t)

Productora – Weighted recoveries of 84% Cu, 47% Au, 47% Mo and 0% Ag (not reported)

CuEq(%) = Cu(%) + 0.46 x Au(g/t) + 0.00026 x Mo(ppm)

Costa Fuego – Weighted recoveries of 83% Cu, 53% Au, 69% Mo and 23% Ag

CuEq(%) = Cu(%) + 0.52 x Au(g/t) + 0.00039 x Mo(ppm) + 0.0027 x Ag(g/t)

** Reported on a 100% Basis - combining Mineral Resource Estimates for the Cortadera, Productora and San Antonio deposits. Figures are rounded, reported to appropriate significant figures, and reported in accordance with the JORC Code, CIM and NI 43-101. Metal rounded to nearest thousand, or if less, to the nearest hundred.

Total Resource reported at +0.21% CuEq for open pit and +0.30% CuEq for underground.

Figure 2. Location of Cuerpo 4 and other immediate porphyry targets within the AMSA landholding and new landholding acquired through public auction, lying immediately west of the Cortadera resource.Figure 3. Location of Cuerpo 4 and other immediate porphyry targets within the AMSA landholding and new landholding acquired through public auction, lying immediately west of the Cortadera resource. Note magnetic (RTP magnetics image – blue is low, red is high) signature of the Cortadera deposit window in relation to A+B vein contours and late stage porphyry dykes. Subtle de-magnetised anomalies along the main mineralising trends (Las Canas and Cortadera) are of particular interest given the magnetic signatures of Cortadera's three porphyry centres.Figure 4. Location of Cuerpo 4 and other immediate porphyry targets within the AMSA landholding and new landholding acquired through public auction, lying immediately west of the Cortadera resource. Note surface molybdenum anomalies at Cortadera and Cortadera North in relation to A+B vein contours and late stage porphyry dykes. Expansion of surface geochemistry and mapping is planned across the new landholdings.

Refer to ASX Announcement "Hot Chili Delivers Next Level of Growth" (31st March 2022) for JORC Code Table 1 information related to the Costa Fuego JORC-compliant Mineral Resource Estimate (MRE) by Competent Person Elizabeth Haren, constituting the MREs of Cortadera, Productora and San Antonio (which combine to form Costa Fuego).

* Copper Equivalent (CuEq) reported for the resource were calculated using the following formula: CuEq% = ((Cu% × Cu price 1% per tonne × Cu_recovery) + (Mo ppm × Mo price per g/t × Mo_recovery) + (Au ppm × Au price per g/t × Au_recovery) + (Ag ppm × Ag price per g/t × Ag_recovery)) / (Cu price 1% per tonne × Cu_recovery).

The Metal Prices applied in the CuEq calculation were: Cu=3.00 USD/lb, Au=1,700 USD/oz, Mo=14 USD/lb, and Ag=20 USD/oz. Metallurgical recovery averages for each deposit consider Indicated + Inferred material and are weighted to combine sulphide flotation and oxide leaching performance. The recovery and copper equivalent formula for each deposit is:

Cortadera and San Antonio – Weighted recoveries of 82% Cu, 55% Au, 82% Mo and 37% Ag.

CuEq(%) = Cu(%) + 0.56 x Au(g/t) + 0.00046 x Mo(ppm) + 0.0043 x Ag(g/t)

Productora – Weighted recoveries of 84% Cu, 47% Au, 47% Mo and 0% Ag (not reported)

CuEq(%) = Cu(%) + 0.46 x Au(g/t) + 0.00026 x Mo(ppm)

Costa Fuego – Weighted recoveries of 83% Cu, 53% Au, 69% Mo and 23% Ag

CuEq(%) = Cu(%) + 0.52 x Au(g/t) + 0.00039 x Mo(ppm) + 0.0027 x Ag(g/t)

** Reported on a 100% Basis - combining Mineral Resource Estimates for the Cortadera, Productora and San Antonio deposits. Figures are rounded, reported to appropriate significant figures, and reported in accordance with the JORC Code, CIM and NI 43-101. Metal rounded to nearest thousand, or if less, to the nearest hundred.

Total Resource reported at +0.21% CuEq for open pit and +0.30% CuEq for underground.

** Note: Silver (Ag) is only present within the Cortadera Mineral Resource estimate

Competent Person's Statement- Exploration Results

Exploration information in this Announcement is based upon work compiled by Mr Christian Easterday, the Managing Director and a full-time employee of Hot Chili Limited whom is a Member of the Australasian Institute of Geoscientists (AIG). Mr Easterday has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a ‘Competent Person' as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves' (JORC Code). Mr Easterday consents to the inclusion in the report of the matters based on their information in the form and context in which it appears.

Competent Person's Statement- Costa Fuego Mineral Resources

The information in this report that relates to Mineral Resources for Cortadera, Productora and San Antonio which constitute the combined Costa Fuego Project is based on information compiled by Ms Elizabeth Haren, a Competent Person who is a Member and Chartered Professional of The Australasian Institute of Mining and Metallurgy and a Member of the Australian Institute of Geoscientists. Ms Haren is a full-time employee of Haren Consulting Pty Ltd and an independent consultant to Hot Chili. Ms Haren has sufficient experience, which is relevant to the style of mineralisation and types of deposits under consideration and to the activities undertaken, to qualify as a Competent Person as defined in the 2012 Edition of the ‘Australasian Code of Reporting of Exploration Results, Mineral Resources and Ore Reserves'. Ms Haren consents to the inclusion in the report of the matters based on her information in the form and context in which it appears. For further information on the Costa Fuego Project, refer to the technical report titled "Resource Report for the Costa Fuego Technical Report", dated December 13, 2021, which is available for review under Hot Chili's profile at www.sedar.com.

Reporting of Copper Equivalent

Copper Equivalent (CuEq) reported for the resource were calculated using the following formula: CuEq% = ((Cu% × Cu price 1% per tonne × Cu_recovery) + (Mo ppm × Mo price per g/t × Mo_recovery) + (Au ppm × Au price per g/t × Au_recovery) + (Ag ppm × Ag price per g/t × Ag_recovery)) / (Cu price 1% per tonne × Cu_recovery). The Metal Prices applied in the CuEq calculation were: Cu=3.00 USD/lb, Au=1,700 USD/oz, Mo=14 USD/lb, and Ag=20 USD/oz. Metallurgical recovery averages for each deposit consider Indicated + Inferred material and are weighted to combine sulphide flotation and oxide leaching performance. The recovery and copper equivalent formula for each deposit is:

Cortadera and San Antonio – Weighted recoveries of 82% Cu, 55% Au, 82% Mo and 37% Ag.

CuEq(%) = Cu(%) + 0.56 x Au(g/t) + 0.00046 x Mo(ppm) + 0.0043 x Ag(g/t)

Productora – Weighted recoveries of 84% Cu, 47% Au, 47% Mo and 0% Ag (not reported)

CuEq(%) = Cu(%) + 0.46 x Au(g/t) + 0.00026 x Mo(ppm)

Costa Fuego – Weighted recoveries of 83% Cu, 53% Au, 69% Mo and 23% Ag

CuEq(%) = Cu(%) + 0.52 x Au(g/t) + 0.00039 x Mo(ppm) + 0.0027 x Ag(g/t)

About Hot Chili

Hot Chili Limited is a mineral exploration company with assets in Chile. The Company's flagship project, Costa Fuego, is the consolidation into a hub of the Cortadera porphyry copper-gold discovery and the Productora copper-gold deposit, set 14 km apart in an excellent location – low altitude, coastal range of Chile, infrastructure rich, low capital intensity. The Costa Fuego landholdings, contains an Indicated Resource of 725Mt grading 0.47% CuEq (copper equivalent), containing 2.8 Mt Cu, 2.6 Moz Au, 10.4 Moz Ag, and 67 kt Mo and an Inferred Resource of 202 Mt grading 0.36% CuEq containing 0.6Mt Cu, 0.4 Moz Au, 2.0 Moz Ag and 13 kt Mo, at a cut-off grade of +0.21% CuEq for open pit and +0.30% CuEq for underground. (Refer to ASX Announcement "Hot Chili Delivers Next Level of Growth" (31st March 2022) and Technical Report NI 43-101 titled "Resource Report for the Costa Fuego Copper Project Located in Atacama, Chile", dated 13 May 2022). The Company is working to advance its Costa Fuego Project through a preliminary feasibility study (followed by a full FS and DTM), and test several high-priority exploration targets.

Certain statements contained in this news release, including information as to the future financial or operating performance of Hot Chili and its projects may include statements that are "forward�looking statements" which may include, amongst other things, statements regarding targets, estimates and assumptions in respect of mineral reserves and mineral resources and anticipated grades and recovery rates, production and prices, recovery costs and results, and capital expenditures and are or may be based on assumptions and estimates related to future technical, economic, market, political, social and other conditions.These forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by Hot Chili, are inherently subject to significant technical, business, economic, competitive, political and social uncertainties and contingencies and involve known and unknown risks and uncertainties that could cause actual events or results to differ materially from estimated or anticipated events or results reflected in such forward�looking statements.

Hot Chili disclaims any intent or obligation to update publicly or release any revisions to any forward�looking statements, whether as a result of new information, future events, circumstances or results or otherwise after the date of this news release or to reflect the occurrence of unanticipated events, other than as may be required by law. The words "believe", "expect", "anticipate", "indicate", "contemplate", "target", "plan", "intends", "continue", "budget", "estimate", "may", "will", "schedule" and similar expressions identify forward�looking statements.

All forward�looking statements made in this news release are qualified by the foregoing cautionary statements. Investors are cautioned that forward�looking statements are not a guarantee of future performance and accordingly investors are cautioned not to put undue reliance on forward�looking statements due to the inherent uncertainty therein.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.

Contact Details

Investor Relations

Graham Farrell

+1 416-842-9003

Graham.Farrell@harbor-access.com

Investor Relations

Jonathan Paterson

+1 475-477-9401

Jonathan.Paterson@harbor-access.com

Managing Director

Christian Easterday

admin@hotchili.net.au

Company Website

https://www.hotchili.net.au/investors/

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Hot Chili Executes Option to Secure Major Extension to Cortadera

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Fourth Porphyry Added to Cortadera

· Hot Chili has executed an Option Agreement with Antofagasta Minerals S.A. (AMSA) to acquire a 100% interest in five highly prospective mining rights, containing the potential western extension of Hot Chili's Cortadera copper-gold discovery , the centrepiece of the Company's low-altitude, Costa Fuego senior copper development in Chile

* Drilling data and associated drilling intersections not previously publicly reported, AMSA internal report, see JORC Code Table 1 in this announcement for further details)

** Copper Equivalent (CuEq) reported for the drillhole intersections were calculated using the following formula: CuEq% = ((Cu% × Cu price 1% per tonne × Cu_recovery) + (Mo ppm × Mo price per g/t × Mo_recovery) + (Au ppm × Au price per g/t × Au_recovery) + (Ag ppm × Ag price per g/t × Ag_recovery)) / (Cu price 1% per tonne × Cu_recovery). The Metal Prices applied in the calculation were: Cu=3.00 USD/lb, Au=1,700 USD/oz, Mo=14 USD/lb, and Ag=20 USD/oz. The entirety of the intersection is assumed as fresh. The recovery and copper equivalent formula for Cortadera – Recoveries of 83% Cu, 56% Au, 83% Mo and 37% Ag. CuEq(%) = Cu(%) + 0.56 x Au(g/t) + 0.00046 x Mo(ppm) + 0.0043 x Ag(g/t)

Hot Chili Limited (ASX: HCH) (TSXV:HCH) (OTCQX: HHLKF) ("Hot Chili" or "Company") is pleased to provide details of a material transaction with Chilean copper major Antofagasta Minerals S.A. (AMSA).

Hot Chili has executed an Option Agreement enabling Hot Chili to acquire a 100% interest in AMSA's mining rights adjoining the western margin of Hot Chili's Cortadera copper-gold porphyry discovery, the centre-piece of the Company's Costa Fuego senior copper development in Chile.

This strategic option agreement consolidates the highly prospective AMSA mining rights, containing near-surface drill intersections of copper-gold porphyry mineralisation, with Hot Chili's contiguous Cortadera project.

Cortadera has been the growth engine for Hot Chili since the Company executed a transaction to acquire the project in 2019.

Cortadera's current Indicated resource of 471Mt grading 0.46% CuEq for 1.7Mt copper and 1.8Moz gold and Inferred resource of 108Mt grading 0.35% CuEq for an additional 0.3Mt copper and 0.3Moz gold (ASX announcement dated 31 st March 2022) is contained within three porphyry centres, trending NW-SE, over a strike extent of 2.3km.

The option enables the consolidation of Cortadera and near doubles the prospective strike length of the discovery, increasing the near term, material resource growth potential for Hot Chili.

AMSA's five mining rights cover 517 hectares and contain a large outcropping mineralised porphyry (Cuerpo 4 - 700m in strike length by 300m in width) with similar dimensions to Cortadera's main porphyry (Cuerpo 3) as well as other identified porphyry targets, trending N-S, over a prospective strike extent of approximately 1.8km.

In 2005, AMSA intersected significant copper-gold-molybdenum mineralisation at Cuerpo 4, with five shallow Reverse Circulation (RC) drill holes totalling 1,056m (Drilling data and associated drilling intersections not previously publicly reported, AMSA internal report, see JORC Code Table 1 in this announcement for further details).

Four of AMSA's five drill holes recorded wide intersections of mineralisation, including COR-03 which recorded 128m grading 0.5% CuEq (0.4% Cu & 0.1g/t Au) from 28m downhole depth, including 16m grading 1.3% CuEq (1% Cu & 0.5g/t Au) from 28m.

The historical drilling across Cuerpo 4 clearly demonstrates open pit resource growth potential, given the shallow nature of copper-gold-molybdenum mineralisation, and near-surface, copper-gold enrichment.

Next Steps – Rapid Resource Definition

A first-pass drilling programme comprising 16 holes for 6,000m is expected to start as soon as possible.

Drilling will test Cuerpo 4 and two other targets within AMSA's landholding using RC and Diamond (DD) drilling. Hot Chili and AMSA have agreed on the detail and staging of the planned drilling programme after a collaborative and detailed geological review by both companies' technical teams.

Drilling is also planned across Hot Chili's Cortadera North target, where earlier exploration drilling targeting a large surface molybdenum anomaly in 2020 intersected wide zones of silver mineralisation. This work vectored towards a sizeable copper-gold porphyry target (Cuerpo 4) on AMSA's adjacent mining right.

Hot Chili then ceased all exploration activities at Cortadera North until an agreement could be entered into with AMSA to enable Hot Chili to acquire the adjacent landholding.

Revision to Costa Fuego Growth and Development Timetable

The transaction provides the next step in Hot Chili's long term growth strategy. The AMSA mining rights provide relatively low cost and highly accretive resource growth potential due to their proximity to the Company's Cortadera open pit resource base.

Hot Chili's next resource update, which was proposed to be delivered in late 2022, is now expected to be finalised in H2 2023 to include the proposed drilling on the AMSA mining rights.

The combined Pre-feasibility Study (PFS) for Costa Fuego, studying targeted annual production rates of up to 100kt Cu and up to 70koz Au for a +20 year life of mine, will be paused until the Company can assess the impact of resource growth potential at Cortadera. The Company's decision to pivot the PFS ensures that future expenditure relating to the PFS can be optimised for infrastructure location and a potentially larger scale copper operation.

Only critical PFS workstreams will be continued to secure long-lead time items (environmental and social) and key value additions (metallurgical) to ensure Costa Fuego remains on-track to potentially be delivered into production in 2028.

A Preliminary Economic Assessment( PEA) of the combined Costa Fuego project at the current 20Mtpa sulphide concentrator study scale is now planned to be delivered in H1 2023.

Hot Chili aims to ensure that Costa Fuego's "clean and green" attributes, including low elevation/coastal location, proximity to existing infrastructure, access to renewable power, use of seawater for processing and a central processing strategy, can be leveraged with this consolidation and growth opportunity.

Costa Fuego remains one of a few front-runner, large copper development projects in the world that can be advanced to production in a timely manner due to Hot Chili's consolidation, development and permitting efforts over the last decade.

Recent positive developments in Chile's constitutional process and taxation review have reaffirmed Chile's stable and attractive standing as a top global mining investment jurisdiction.

Option Agreement to Acquire 100% Interest in AMSA's Cortadera Mining Rights

Under an Option Agreement (Option) between Frontera SpA ("Frontera" - 100% subsidiary of Hot Chili) and Antofagasta Minerals SA (AMSA), Frontera has the option to acquire a 100% interest in the AMSA mining rights adjoining Cortadera within a two-year period on the following terms:

· Completion of 6,000m of drilling of any type, and

· Upon completion of the 6,000m drill commitment, Payment of a US$1.5 million Option exercise price to acquire the AMSA's mining rights, and

· Following exercise of the Option, AMSA has the right to buy-back a 55% interest in the AMSA mining rights within 120 days of exercise of the Option, by repaying 55% of the Option exercise price and paying five times the exploration expenditure incurred during the option period.

This transaction represents a strategic consolidation of the Cortadera porphyry deposit area and has the potential to deliver relatively low-cost, organic resource growth to the Costa Fuego copper hub.

Hot Chili plans to commence systematic exploration and resource definition drilling across this new landholding addition at Cortadera as soon as possible.

The Directors thank AMSA for their commitment to work with Hot Chili and to enable the continued consolidation of a globally significant, emerging copper hub for the Vallenar region of Chile.

This announcement is authorised by the Board of Directors for release to ASX and TSX.

Figure 1. Location of new mining rights(AMSA) relating to Cortadera, Productora, San Antonio, Valentina and nearby coastal range infrastructure of Hot Chili's combined Costa Fuego copper-gold project, located 600km north of Santiago in Chile.

* Copper Equivalent (CuEq) reported for the resource were calculated using the following formula: CuEq% = ((Cu% × Cu price 1% per tonne × Cu_recovery) + (Mo ppm × Mo price per g/t × Mo_recovery) + (Au ppm × Au price per g/t × Au_recovery) + (Ag ppm × Ag price per g/t × Ag_recovery)) / (Cu price 1% per tonne × Cu_recovery).

The Metal Prices applied in the CuEq calculation were: Cu=3.00 USD/lb, Au=1,700 USD/oz, Mo=14 USD/lb, and Ag=20 USD/oz. Metallurgical recovery averages for each deposit consider Indicated + Inferred material and are weighted to combine sulphide flotation and oxide leaching performance. The recovery and copper equivalent formula for each deposit is:

Cortadera and San Antonio – Weighted recoveries of 82% Cu, 55% Au, 82% Mo and 37% Ag.

CuEq(%) = Cu(%) + 0.56 x Au(g/t) + 0.00046 x Mo(ppm) + 0.0043 x Ag(g/t)

Productora – Weighted recoveries of 84% Cu, 47% Au, 47% Mo and 0% Ag (not reported)

CuEq(%) = Cu(%) + 0.46 x Au(g/t) + 0.00026 x Mo(ppm)

Costa Fuego – Weighted recoveries of 83% Cu, 53% Au, 69% Mo and 23% Ag

CuEq(%) = Cu(%) + 0.52 x Au(g/t) + 0.00039 x Mo(ppm) + 0.0027 x Ag(g/t)

** Reported on a 100% Basis - combining Mineral Resource Estimates for the Cortadera, Productora and San Antonio deposits. Figures are rounded, reported to appropriate significant figures, and reported in accordance with the JORC Code, CIM and NI 43-101. Metal rounded to nearest thousand, or if less, to the nearest hundred.

Total Resource reported at +0.21% CuEq for open pit and +0.30% CuEq for underground.

Table 1. Historical Significant DD Results from Cuerpo 4 (AMSA) at Cortadera

Note: All results represent 2m composites with appropriate analysis undertaken for Cu, Au and Mo by various independent laboratories in Chile. Refer to Table1 of this announcement for further detail on sampling methodology, analytical techniques and QA/QC procedures utilised.

* Copper Equivalent (CuEq) reported for the drillhole intersections were calculated using the following formula: CuEq% = ((Cu% × Cu price 1% per tonne × Cu_recovery) + (Mo ppm × Mo price per g/t × Mo_recovery) + (Au ppm × Au price per g/t × Au_recovery) + (Ag ppm × Ag price per g/t × Ag_recovery)) / (Cu price 1% per tonne × Cu_recovery).

The Metal Prices applied in the calculation were: Cu=3.00 USD/lb, Au=1,700 USD/oz, Mo=14 USD/lb, and Ag=20 USD/oz. The entirety of the intersection is assumed as fresh. The recovery and copper equivalent formula for each deposit is:

Cortadera – Recoveries of 83% Cu, 56% Au, 83% Mo and 37% Ag. CuEq(%) = Cu(%) + 0.56 x Au(g/t) + 0.00046 x Mo(ppm) + 0.0043 x Ag(g/t)

For Cortadera and Productora, significant intersections are calculated above a nominal cut-off grade of 0.2% Cu. Where appropriate, significant intersections may contain up to 30m down-hole distance of internal dilution (less than 0.2% Cu). Significant intersections are separated where internal dilution is greater than 30m down-hole distance. The selection of 0.2% Cu for significant intersection cut-off grade is aligned with marginal economic cut-off grade for bulk tonnage polymetallic copper deposits of similar grade in Chile and elsewhere in the world. Down-hole significant intersection widths are estimated to be at or around true-widths of mineralisation.

Figure 2. Location of Cuerpo 4 and other immediate porphyry targets within the AMSA landholding, lying immediately west of the Cortadera resource. Note outcrop photos from Cuerpo 4Figure 3. Location of Cuerpo 4 and other immediate porphyry targets within the AMSA landholding, lying immediately west of the Cortadera resource. Note the location of significant historical diamond drilling intersections recorded in shallow drilling undertaken across Cuerpo 4 in 2005.Figure 4. Location of Cuerpo 4 and other immediate porphyry targets within the AMSA landholding, lying immediately west of the Cortadera resource. Note magnetic (RTP magnetics image – blue is low, red is high) signature of the Cortadera deposit window in relation to A+B vein contours and late stage porphyry dykes.11 Figure 5. Location of Cuerpo 4 and other immediate porphyry targets within the AMSA landholding, lying immediately west of the Cortadera resource. Note surface molybdenum anomalies at Cortadera and Cortadera North in relation to A+B vein contours and late stage porphyry dykes.

Refer to ASX Announcement "Hot Chili Delivers Next Level of Growth" (31st March 2022) for JORC Code Table 1 information related to the Costa Fuego JORC-compliant Mineral Resource Estimate (MRE) by Competent Person Elizabeth Haren, constituting the MREs of Cortadera, Productora and San Antonio (which combine to form Costa Fuego).

* Copper Equivalent (CuEq) reported for the resource were calculated using the following formula: CuEq% = ((Cu% × Cu price 1% per tonne × Cu_recovery) + (Mo ppm × Mo price per g/t × Mo_recovery) + (Au ppm × Au price per g/t × Au_recovery) + (Ag ppm × Ag price per g/t × Ag_recovery)) / (Cu price 1% per tonne × Cu_recovery).

The Metal Prices applied in the CuEq calculation were: Cu=3.00 USD/lb, Au=1,700 USD/oz, Mo=14 USD/lb, and Ag=20 USD/oz. Metallurgical recovery averages for each deposit consider Indicated + Inferred material and are weighted to combine sulphide flotation and oxide leaching performance. The recovery and copper equivalent formula for each deposit is:

Cortadera and San Antonio – Weighted recoveries of 82% Cu, 55% Au, 82% Mo and 37% Ag.

CuEq(%) = Cu(%) + 0.56 x Au(g/t) + 0.00046 x Mo(ppm) + 0.0043 x Ag(g/t)

Productora – Weighted recoveries of 84% Cu, 47% Au, 47% Mo and 0% Ag (not reported)

CuEq(%) = Cu(%) + 0.46 x Au(g/t) + 0.00026 x Mo(ppm)

Costa Fuego – Weighted recoveries of 83% Cu, 53% Au, 69% Mo and 23% Ag

CuEq(%) = Cu(%) + 0.52 x Au(g/t) + 0.00039 x Mo(ppm) + 0.0027 x Ag(g/t)

** Reported on a 100% Basis - combining Mineral Resource Estimates for the Cortadera, Productora and San Antonio deposits. Figures are rounded, reported to appropriate significant figures, and reported in accordance with the JORC Code, CIM and NI 43-101. Metal rounded to nearest thousand, or if less, to the nearest hundred.

Total Resource reported at +0.21% CuEq for open pit and +0.30% CuEq for underground.

** Note: Silver (Ag) is only present within the Cortadera Mineral Resource estimate

Competent Person's Statement- Exploration Results

Exploration information in this Announcement is based upon work compiled by Mr Christian Easterday, the Managing Director and a full-time employee of Hot Chili Limited whom is a Member of the Australasian Institute of Geoscientists (AIG). Mr Easterday has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a ‘Competent Person' as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves' (JORC Code). Mr Easterday consents to the inclusion in the report of the matters based on their information in the form and context in which it appears.

Competent Person's Statement- Costa Fuego Mineral Resources

The information in this report that relates to Mineral Resources for Cortadera, Productora and San Antonio which constitute the combined Costa Fuego Project is based on information compiled by Ms Elizabeth Haren, a Competent Person who is a Member and Chartered Professional of The Australasian Institute of Mining and Metallurgy and a Member of the Australian Institute of Geoscientists. Ms Haren is a full-time employee of Haren Consulting Pty Ltd and an independent consultant to Hot Chili. Ms Haren has sufficient experience, which is relevant to the style of mineralisation and types of deposits under consideration and to the activities undertaken, to qualify as a Competent Person as defined in the 2012 Edition of the ‘Australasian Code of Reporting of Exploration Results, Mineral Resources and Ore Reserves'. Ms Haren consents to the inclusion in the report of the matters based on her information in the form and context in which it appears. For further information on the Costa Fuego Project, refer to the technical report titled "Resource Report for the Costa Fuego Technical Report", dated December 13, 2021, which is available for review under Hot Chili's profile at www.sedar.com.

Reporting of Copper Equivalent

Copper Equivalent (CuEq) reported for the resource were calculated using the following formula: CuEq% = ((Cu% × Cu price 1% per tonne × Cu_recovery) + (Mo ppm × Mo price per g/t × Mo_recovery) + (Au ppm × Au price per g/t × Au_recovery) + (Ag ppm × Ag price per g/t × Ag_recovery)) / (Cu price 1% per tonne × Cu_recovery). The Metal Prices applied in the CuEq calculation were: Cu=3.00 USD/lb, Au=1,700 USD/oz, Mo=14 USD/lb, and Ag=20 USD/oz. Metallurgical recovery averages for each deposit consider Indicated + Inferred material and are weighted to combine sulphide flotation and oxide leaching performance. The recovery and copper equivalent formula for each deposit is:

Cortadera and San Antonio – Weighted recoveries of 82% Cu, 55% Au, 82% Mo and 37% Ag.

CuEq(%) = Cu(%) + 0.56 x Au(g/t) + 0.00046 x Mo(ppm) + 0.0043 x Ag(g/t)

Productora – Weighted recoveries of 84% Cu, 47% Au, 47% Mo and 0% Ag (not reported)

CuEq(%) = Cu(%) + 0.46 x Au(g/t) + 0.00026 x Mo(ppm)

Costa Fuego – Weighted recoveries of 83% Cu, 53% Au, 69% Mo and 23% Ag

CuEq(%) = Cu(%) + 0.52 x Au(g/t) + 0.00039 x Mo(ppm) + 0.0027 x Ag(g/t)

About Hot Chili

Hot Chili Limited is a mineral exploration company with assets in Chile. The Company's flagship project, Costa Fuego, is the consolidation into a hub of the Cortadera porphyry copper-gold discovery and the Productora copper-gold deposit, set 14 km apart in an excellent location – low altitude, coastal range of Chile, infrastructure rich, low capital intensity. The Costa Fuego landholdings, contains an Indicated Resource of 725Mt grading 0.47% CuEq (copper equivalent), containing 2.8 Mt Cu, 2.6 Moz Au, 10.4 Moz Ag, and 67 kt Mo and an Inferred Resource of 202 Mt grading 0.36% CuEq containing 0.6Mt Cu, 0.4 Moz Au, 2.0 Moz Ag and 13 kt Mo, at a cut-off grade of +0.21% CuEq for open pit and +0.30% CuEq for underground. The Company is working to advance its Costa Fuego Project through a preliminary feasibility study (followed by a full FS and DTM), and test several high-priority exploration targets.

Certain statements contained in this news release, including information as to the future financial or operating performance of Hot Chili and its projects may include statements that are "forward�looking statements" which may include, amongst other things, statements regarding targets, estimates and assumptions in respect of mineral reserves and mineral resources and anticipated grades and recovery rates, production and prices, recovery costs and results, and capital expenditures and are or may be based on assumptions and estimates related to future technical, economic, market, political, social and other conditions.These forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by Hot Chili, are inherently subject to significant technical, business, economic, competitive, political and social uncertainties and contingencies and involve known and unknown risks and uncertainties that could cause actual events or results to differ materially from estimated or anticipated events or results reflected in such forward�looking statements.

Hot Chili disclaims any intent or obligation to update publicly or release any revisions to any forward�looking statements, whether as a result of new information, future events, circumstances or results or otherwise after the date of this news release or to reflect the occurrence of unanticipated events, other than as may be required by law. The words "believe", "expect", "anticipate", "indicate", "contemplate", "target", "plan", "intends", "continue", "budget", "estimate", "may", "will", "schedule" and similar expressions identify forward�looking statements.

All forward�looking statements made in this news release are qualified by the foregoing cautionary statements. Investors are cautioned that forward�looking statements are not a guarantee of future performance and accordingly investors are cautioned not to put undue reliance on forward�looking statements due to the inherent uncertainty therein.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.

Contact Details

Investor Relations

Graham Farrell

+1 416-842-9003

Graham.Farrell@harbor-access.com

Investor Relations

Jonathan Paterson

+1 475-477-9401

Jonathan.Paterson@harobr-access.com

Managing Director

Christian Easterday

admin@hotchili.net.au

Company Website

https://www.hotchili.net.au/investors/

Copyright (c) 2022 TheNewswire - All rights reserved.

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