Commitment to Jointly Fund Feasibility
Study for Bulk Concentrate Exports
Highlights
- Hot Chili have executed a Memorandum of Understanding (MOU)
with Puerto Las Losas SA ("PLL") for the right to negotiate a
binding Port Services Agreement for the Company's nearby, Costa
Fuego copper-gold project in Chile
- Hot Chili will fund 20% of an estimated two-year,
US$4.6 million Feasibility Study for
a bulk tonnage copper concentrate facility to be developed at Las
Losas Port, 50km west of Costa Fuego
- In consultation with Hot Chili, PLL shall select and commission
a top-tier independent engineering company to commence and
undertake the port Feasibility Study
- Following completion of the port Feasibility Study, Hot
Chili shall have a right of first refusal (ROFR) to ship copper
concentrates through Puerto Las Losas facilities for three
years, provided that a shipping solution is agreed at existing
or potential infrastructure of PLL
- The Feasibility Study will include bulk loading alternatives
for copper concentrates from existing facilities, potentially with
or without modifying the existing infrastructure for the operating
port
Hot Chili's Managing Director and CEO Christian Easterday said the MOU with PLL is a
significant step forward to securing one of Hot Chili's last
remaining potential infrastructure advantages for Costa Fuego –
port access.
"Leveraging an existing port, located 50km away, into a bulk
concentrate export facility has the potential to unlock significant
capital and operating savings for Costa Fuego and other potential
mine developers in the Huasco region of Chile.
"We are pleased to be a joint funding partner with PLL for
this feasibility study and the five-year optionality that this MOU
provides Hot Chili, to negotiate a binding port services agreement
as a foundation bulk concentrate customer at Las Losas.
Hot Chili plans to jointly develop a significant copper
infrastructure corridor, enabling our own production, and unlocking
multiple projects within the region, which would benefit
significantly from desalinated water supply and proximal bulk
copper concentrate port facilities."
PERTH,
Australia, March 14, 2024 /CNW/ - Hot Chili Limited
(ASX: HCH) (TSXV: HCH) (OTCQX: HHLKF) ("Hot Chili" or the
"Company") is pleased to announce that the Company has entered into
a MOU with Puerto Las Losas SA ("PLL") to evaluate bulk tonnage
loading alternatives for copper concentrates from the Company's
Costa Fuego Copper-Gold Project ("Costa Fuego" or "the Project") in
Chile.
Importantly, the MOU with PLL provides Hot Chili the right, for
up to five years, to negotiate a binding Port Services Agreement
for Costa Fuego.
The potential Port Service Agreement would include a "Take or
Pay Volume" clause, based on at least 80% of Costa Fuego's
projected future annual concentrate production.
Under the terms of the agreement, Hot Chili and PLL will
undertake a port Feasibility Study, which will be managed by
PLL, and include Pre-Feasibility Engineering (FEL2),
Feasibility Engineering (FEL3) and Environmental Studies.
Hot Chili will fund 20% of the port Feasibility Study, which is
estimated to cost approximately US$4.6
million and take approximately two years to complete.
Upon completion of the port Feasibility Study, and provided that
a shipping solution for loading copper concentrates is agreed at
existing or potential infrastructure in PLL, Hot Chili will have a
Right of First Refusal (the "ROFR") to ship copper concentrates
through PLL's facilities in Huasco Bay for a three-year period. PLL
may terminate the ROFR by reimbursing Hot Chili's port Feasibility
Study costs.
The Company is well-funded and looks forward to providing
further updates across its multiple activity streams.
Feasibility Study for Bulk Port
Facility at Las Losas Set to Commence
Within the coming months, in consultation with Hot Chili, PLL
will be responsible for selecting a suitably qualified, top-tier,
independent engineering company to commence and undertake a port
Feasibility Study.
The port Feasibility Study will evaluate bulk handling and
loading alternatives for copper concentrates using the existing Las
Losas port facilities, potentially with or without modifying the
existing infrastructure for the port in operation.
Studies will consider previous technical information for the
development and construction of new infrastructure to load copper
concentrate with a specialized ship loader and mechanized
system.
Representatives from Hot Chili and PLL will form a technical
committee to progress the studies. Within the first month, the
technical committee will define key project deliverables and a
timetable for management of the completion of the port Feasibility
Study workstreams.
This announcement is authorised by the Board of Directors for
release to ASX and TSXV.
Hot Chili's Managing Director and Chief Executive Officer Mr
Christian Easterday is responsible
for this announcement and has provided sign-off for release to the
ASX and TSXV.
For more information please contact:
Christian
Easterday
Managing Director – Hot
Chili
|
|
Tel: +61 8 9315
9009
Email:
admin@hotchili.net.au
|
Penelope
Beattie
Company Secretary – Hot
Chili
|
|
Tel: +61 8 9315
9009
Email:
admin@hotchili.net.au
|
Harbor
Access
Investor & Public
Relations
|
|
Email:
graham.farrell@harbor-access.com
Email:
jonathan.paterson@harbor-access.com
|
or visit Hot Chili's website at www.hotchili.net.au
Qualifying Statements
Disclaimer
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.
Qualified Person
The technical information in this
news release has been reviewed and approved by Mr. Christian Easterday, MAIG, Hot Chili's Managing
Director and a qualified person within the meaning of NI43-101.
All amounts in this news release are in U.S. dollars unless
otherwise noted.
Forward Looking Statements
This news release contains
certain statements that are "forward-looking information" within
the meaning of Canadian securities legislation and Australian
securities legislation (each, a "forward-looking statement"). All
statements other than statements of historical fact are
forward-looking statements. The use of any of the words "believe",
"could", "estimate", "expect", "expect", "may", "plan",
"potential", "projections", "should", "will", "would", variants of
these words, and similar expressions are intended to identify
forward-looking statements.
In this news release, forward-looking statements relate, among
other things, to: (a) the Company's timing and ability to enter
into a Port Services Agreement with respect to the Las Losas port,
including the Company's decision to proceed with bulk concentrate
exports, the terms and conditions of any binding Port Services
Agreement, including costs under the Take or Pay provisions, and
arrangements at the expiration of the 5-year term, and (b) the
Company's engagement in the completion of the port Feasibility
Study, including FEL2, FEL3 and Environmental Studies, agreements
for partial funding of the study, engagement of consultants and the
formation of the technical committee to oversee the study,
estimated costs and timeframes to deliver the study, and the
structure of the ROFR with PLL including the 3-year term and
arrangements at the expiration of the 3-year term and in the event
of PLL applying early termination.
Forward-looking statements involve known and unknown risks,
uncertainties, and other factors, which may cause the actual
results, performance, or achievements of the Company to be
materially different from any future results, performance or
achievements expressed or implied by the forward-looking
statements. A number of factors could cause actual results to
differ materially from a conclusion, forecast or projection
contained in the forward-looking statements in this news release,
including, but not limited to, the following material factors: the
ability of the Company to enter into a Port Services Agreement;
obtaining all required regulatory approvals for the completion of
the Port Feasibility Study; operational risks; risks related to the
cost estimates; sovereign risks associated with the Company's
operations in Chile; changes in
estimates of mineral resources of properties where the Company
holds interests; recruiting qualified personnel and retaining key
personnel; future financial needs and availability of adequate
financing; fluctuations in mineral prices; market volatility;
exchange rate fluctuations; ability to exploit successful
discoveries; the production at or performance of properties where
the Company holds interests; ability to retain title to mining
concessions; environmental risks; financial failure or default of
joint venture partners, contractors or service providers;
competition risks; economic and market conditions; and other risks
and uncertainties described elsewhere in this news release and
elsewhere in the Company's public disclosure record.
Although the forward-looking statements contained in this news
release are based upon assumptions which the Company believes to be
reasonable, the Company cannot assure investors that actual results
will be consistent with these forward-looking statements. With
respect to forward-looking statements contained in this news
release, the Company has made assumptions regarding: future
commodity prices and demand; availability of skilled labour; timing
and amount of capital expenditures; future currency exchange and
interest rates; the impact of increasing competition; general
conditions in economic and financial markets; availability of
drilling and related equipment; effects of regulation by
governmental agencies; future tax rates; future operating costs;
availability of future sources of funding; ability to obtain
financing; and assumptions underlying estimates related to adjusted
funds from operations. The Company's actual results, performance or
achievement could differ materially from those expressed in, or
implied by, these forward-looking statements and, accordingly, no
assurance can be given that any of the events anticipated by the
forward-looking statements will transpire or occur, or if any of
them do so, what benefits the Company will derive therefrom.
For additional information with respect to these and other
factors and assumptions underlying the forward-looking statements
made herein, please refer to the public disclosure record of the
Company, including the Company's most recent Annual Report, which
is available on SEDAR+ (www.sedarplus.ca) under the Company's
issuer profile. New factors emerge from time to time, and it is not
possible for management to predict all those factors or to assess
in advance the impact of each such factor on the Company's business
or the extent to which any factor, or combination of factors, may
cause actual results to differ materially from those contained in
any forward-looking statement.
The forward-looking statements contained in this news release
are expressly qualified by the foregoing cautionary statements and
are made as of the date of this news release. Except as may be
required by applicable securities laws, the Company does not
undertake any obligation to publicly update or revise any
forward-looking statement to reflect events or circumstances after
the date of this news release or to reflect the occurrence of
unanticipated events, whether as a result of new information,
future events or results, or otherwise.
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SOURCE Hot Chili Limited