Hot Chili Limited

Hot Chili Limited (ASX: HCH) is a mining development company focused on the Costa Fuego copper and gold project in the Atacama Region of Chile, an asset that combines three unusual attributes: geological scale, strategic relevance, and a differentiated position in terms of costs and infrastructure. At a time when the world is heading towards a structural copper deficit, Costa Fuego has established itself as one of the few undeveloped projects outside the control of major mining companies with the potential to exceed 100,000 tonnes of copper equivalent per year, making it a rare find in the new supply landscape.

The project’s thesis rests on two complementary assets: Costa Fuego, the main asset, which encompasses several deposits and is supported by a robust and detailed pre-feasibility study (PFS); and Huasco Water, a seawater and desalination infrastructure that, in an arid region, transforms the sector’s biggest challenge (water) into a competitive advantage. Compounding these advantages are the backing of Glencore and its Chilean partner CMP, a committed concentrate offtake agreement, and priority project status with the Chilean government. All of this positions the company above a conventional junior mining company, although the inherent risks of a developer that has yet to commit to investment have not yet been mitigated.

Hot Chili offers a conceptually clear proposition: to build a large copper mine in one of the world’s best jurisdictions, aligned with growing demand and a supply that is slow to respond. This is a strength, but also a challenge: its value will depend primarily on its ability to secure the necessary environmental permits (RCA), the feasibility study (DFS), financing, and investment decision (FID), and on how it allocates that financing among shareholders and third parties.

The Truth Below Ground team has studied Hot Chili from multiple disciplines (geology, mining, metallurgy, ESG and regulation, management team and finance) to offer a comprehensive and objective view, which is not limited to describing the attractiveness of the asset, but answers the question that matters: if Costa Fuego can become a mine, under what conditions, with what risks and with what potential for value creation for the shareholder.

What you get in the report:

• 40+ quantified and prioritised risks and opportunities for the current development phase of Hot Chili.
• Independent technical analysis by discipline (geology, mining, metallurgy, ESG, management team, and finance).
• Valuation model and financing assumptions, including a bridge to share value prior to structuring the Costa Fuego project (DCF and sensitivity analysis of key variables).
• Individual expert opinions, integrated conclusion, and analysis of the key milestones supporting the thesis and on which its growth depends.