Hot Chili and Los Losas Port Execute a MOU to Negotiate Binding Port Services Agreement for Costa Fuego Commitment to Jointly Fund Feasibility Study for Bulk Concentrate Exports
Hot Chili and Los Losas Port Execute a MOU to Negotiate Binding Port
Services Agreement for Costa Fuego
Commitment to Jointly Fund Feasibility Study for Bulk Concentrate Exports
View across the existing Las Losas Port facility, Huasco Bay Chile, 2023 (CNW Group/Hot Chili Limited)
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: [email protected]
Penelope Beattie
Company Secretary – Hot Chili
Tel: +61 8 9315 9009
Email: [email protected]
Harbor Access
Investor & Public Relations
Email:
Email:
or visit Hot Chili's website at
www.hotchili.net.au
Location of Hot Chili’s coastal range Costa Fuego copper-gold project. Note the location of Las Losas port, 50km from the planned location of central processing
(Productora) at Costa Fuego. (CNW Group/Hot Chili Limited)
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
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CNW 07:05e 14-MAR-24