Hot Chili Limited (ASX: HCH | TSXV: HCH | OTCQX: HHLKF) has materially improved the terms of several option agreements to acquire landholdings as part of the company’s Costa Fuego Copper-Gold Project in the coastal range of the Atacama Region, Chile.
Highlights included three options due for exercise in 2024 have been terminated and replaced with one new option agreement, the El Fuego option, now exercisable in September 2026. The new option covers the San Antonio, Valentina, and Santiago Z privately-owned landholdings located along the eastern extent of Costa Fuego.
“Alignment of local partners has been a key element of our consolidation strategy for Costa Fuego. The El Fuego Option allows the company to focus its balance sheet toward exploration and growth of our mineral resource as opposed to property payments,” commented Hot Chili managing director Christian Easterday.
“We are actively evaluating the region for consolidation opportunities, and we expect to see further success on this front as we look to up-scale Costa Fuego’s potential study scale toward 150Ktpa copper development, from its current 95Ktpa copper metal production scale as outlined in our recent preliminary economic assessment.”
The new El Fuego Option is intended to materially reduce Hot Chili’s option payments due in 2024 from US$11M to US$1M and also increases the company’s ownership from 90% to 100%, subject to exercise of the option.
The option will also extend expiration from 2024 to 2026 in exchange for aggregate payments of US$4.3M over the next three years, including the US$1M previously noted.
Easterday commented that the option re-negotiation is further confirmation of the strength of the company’s local partnerships in Chile, with updates on growth drilling, resource up-grades, and water conceptual studies to follow.
For further information, please visit: www.hotchili.net.au
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