HCH.V · 2022-07-19

New High Grade Drill Results at Costa Fuego 56m grading 1.0% CuEq & 8m grading 3.6% CuEq MET0027 (286.4m depth). Tourmaline breccia host rock at Productora. 5.4% Cu, 1.2g/t Au, 3.5g/t Ag, 594ppm Mo

Drill Results Resource Estimates Exploration Programs

Announcement

19^th July 2022

New High Grade Drill Results at Costa Fuego 56m grading 1.0% CuEq & 8m grading 3.6% CuEq

MET0027 (286.4m depth). Tourmaline breccia host rock at Productora. 5.4% Cu, 1.2g/t Au, 3.5g/t Ag, 594ppm Mo

Highlights

Assay results returned from Development Study drillholes for the Costa Fuego senior copper

development in Chile confirm further high-grade growth ahead of next resource upgrade

Standout copper (Cu) and gold (Au) drill results include:
- 484m grading 0.5% CuEq* (0.4% Cu, 0.1g/t Au from 548m depth down-hole (Cortadera) including 56m grading 1.0% CuEq (0.8% Cu, 0.3g/t Au) from 644m depth, and including 206m grading 0.7% CuEq (0.5% Cu, 0.2g/t Au) from 800m depth
- 45m grading 1.2% CuEq (1.0% Cu, 0.2g/t Au) from 280m downhole (Productora)

including 8m grading 3.6% CuEq (3.0% Cu, 0.8g/t Au)

39m¹ grading 1.1% CuEq (1.0% Cu, 0.1g/t Au) from 36m downhole (Productora)

including 12m grading 1.5% CuEq (1.4% Cu, 0.2g/t Au)

Thirty-four drill holes complete and twelve drill holes remaining to drill at the high-grade San Antonio and Valentina copper deposits, results pending
First drilling to commence at the large-scale Santiago Z porphyry target in early August
Approximately A$22 million in cash, one drill rig in operation and fully funded into late 2023

following cost rationalisation initiatives

Copper Equivalent (CuEq) reported for the drill holes 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). 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. Average fresh rock metallurgical recoveries used for Cortadera were Cu=83%, Au=56%, Mo=82%, and Ag=37%. Average fresh rock metallurgical recoveries used for Productora/Alice were Cu=89%, Au=58%, Mo=60%, and Ag=0%. ¹including 3m unsampled outside of metallurgical test area

Hot Chili Limited ACN 130 955 725 Contact First Floor, 768 Canning Highway, Applecross, Western Australia 6153 Mr Christian Easterday PO Box 1725, Applecross, Western Australia 6953 Managing Director P: +61 8 9315 9009 F: +61 8 9315 5004 E: [email protected]

www.hotchili.net.au

Hot Chili Limited (ASX: HCH) (TSXV: HCH) (OTCQX: HHLKF) (“Hot Chili” or “Company”) is pleased to announce another set of strong results from development study drilling across the Company’s Costa Fuego costal range copper-gold project in Chile.

Drilling has returned higher grade results than expected at both the Cortadera and Productora deposits, as well as providing final inputs for metallurgical and geotechnical testwork programmes.

These new results add to a series of recent outstanding drill intersections, which are expected to have a positive impact on the forthcoming resource upgrade and Pre-feasibility Study (PFS) for Costa Fuego.

Development study drilling is complete and the Company has reduced its drilling operations from three drill rigs (5 shifts of drilling per day) to one drill rig (1 shift of drilling per day) along with implementing other cost rationalisation initiatives.

The Company looks forward to its next set of results from drilling undertaken across its high grade satellite deposits (San Antonio and Valentina) as well as first-ever drilling set to commence across the large-scale Santiago Z porphyry target in early August.

With treasury of approximately A$22 million, Hot Chili is fully funded into late 2023. The Company remains well positioned to deliver Costa Fuego as one of the nearest-term, meaningful new copper mines in the world.

Assays Returned for Final Cortadera Development Study Drillhole

Diamond drillhole CORMET004 returned 484m grading 0.5% CuEq (0.4% Cu, 0.1g/t Au) from 548m depth, including 56m grading 1.0% CuEq (0.8% Cu, 0.3g/t Au) from 644m depth, and including 206m grading 0.7% CuEq (0.5% Cu, 0.2g/t Au) from 800m depth.

The new drill intersection in COREMET004 confirms further down plunge extensions of the high grade core to the main porphyry (Cuerpo 3), with 44m grading 1.0% CuEq (0.8% Cu, 0.3g/t Au) from 878m depth recorded outside of the current high grade (+0.6% Cu) resource domain.

CORMET004 represents the last of six Development Study drillholes completed at Cortadera in Q1 and Q2 2022 as part of a hydrological and geotechnical testwork program.

Assay results for this program have been exceptional (see announcements dated 4^th April 2022, 29^th April 2022 and 20^th May 2022), confirming further growth of the high-grade resources, notably:

552m grading 0.6% CuEq from 276m depth, including 248m at 0.8% CuEq (CORMET003)
876m grading 0.5% CuEq from 246m depth, including 206m grading 0.9% CuEq (CORMET006)
658m grading 0.6% CuEq from 232m depth, including 134m grading 0.8% CuEq and including 130m grading 0.9% CuEq (CORMET005)

Drill results from the Development Study program will be included in the next Mineral Resource upgrade for Costa Fuego, expected in late 2022.

Assay Results for Productora Metallurgical Drilling Programme

Four diamond drillholes have been completed for metallurgical testwork across the Productora resource (three into the Productora central pit area and one into the Alice satellite pit area).

The goal of this testwork is to confirm the processing flowsheet (based on work completed since the 2016 Productora PFS), with a particular focus on material that will be extracted in the first three years of production at Productora.

While only the intervals to be used in the metallurgical testwork program have been assayed, every hole drilled achieved impressive intersections, including:

45m grading 1.2% CuEq (1.0% Cu, 0.2g/t Au) from 280m including 8m grading 3.6% CuEq (3.0% Cu, 0.8g/t Au) from 280m (MET027 - Productora)
39m¹ grading 1.1% CuEq (1.0% Cu, 0.1g/t Au) from 46m including 12m grading 1.5% CuEq (1.4% Cu, 0.2g/t Au) (¹including 3m unsampled outside of metallurgical test area) from 60m (MET028 – Alice porphyry)
39m 0.9% CuEq (0.7% Cu, 0.2g/t Au) from 141m (MET026 – Productora)
39m 0.8% CuEq (0.7% Cu, 0.2g/t Au) from 78m (MET025 – Productora)

The intersection in MET028 is particularly exciting as it is located near-surface in the higher-grade Alice porphyry satellite pit.

MET028 (65m to 68m depth down-hole) near-surface, high grade, copper oxide drill intersection through Alice felsic porphyry host rock with 5 to 10% A-B vein abundance.

High Grade Satellite Resource Drilling Continues

First-pass drilling is complete at the Valentina high-grade satellite copper deposit, with VALMET002 intersecting a shallow zone of copper sulphide and oxide mineralisation (see announcement dated 13^th June 2022). Following the success of this program, an additional eleven drillholes were planned to further extend and define mineralisation at Valentina.

A total of 22 drill holes have been completed at Valentina, with a further 8 drill holes remaining to be drilled. Assay results are expected shortly and work is underway to create updated geological and mineralisation models ahead of a maiden Mineral Resource estimate later this year.

In addition to Valentina, 12 resource in-fill drill holes have been completed at the high-grade San Antonio satellite deposit, with assay results pending. A further 4 drill holes remain to be drilled at San Antonio.

San Antonio’s maiden Inferred resource, reported in March 2022, extends from surface and already stands at 4.2Mt grading 1.2% CuEq (1.1% Cu, 2.1g/t Ag) for 48kt Cu and 287kt Ag.

Drilling at San Antonio is designed to upgrade the categorisation of the resource from Inferred to Indicated, as well as testing for down-plunge mineralisation extensions.

Both high-grade satellite deposits will be included in the next Mineral Resource upgrade and subsequent PFS open pit mine schedule, expected in Q1 2023.

The Company looks forward to releasing further updates from drilling and development study workstreams shortly.

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

For more information please contact:

Christian Easterday Tel: +61 8 9315 9009

Managing Director – Hot Chili Email: [email protected]

Penelope Beattie Tel: +61 8 9315 9009

Company Secretary – Hot Chili Email: [email protected]

ASX Investor

Investor & Public Relations (Australia) Email: [email protected]

Harbor Access Email: [email protected]

Investor & Public Relations (Canada)

Email: [email protected]

or visit Hot Chili’s website at www.hotchili.net.au

Figure 1. Location of Cortadera, Productora, San Antonio and Valentina in relation to coastal range infrastructure of Hot Chili’s combined Costa Fuego copper-gold project, located 600km north of Santiago in Chile

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 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. Refer to Announcement “Hot Chili Delivers Next Level of Growth” (31st March 2022) for JORC Table 1 information related to the Costa Fuego Mineral Resource estimates.

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). 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. For Cortadera, San Antonio and Valentina (Inferred + Indicated), the average metallurgical recoveries were Cu=83%, Au=56%, Mo=82%, and Ag=37%. For Productora (Inferred + Indicated), the average metallurgical recoveries were Cu=83%, Au=43% and Mo=42%.

Table 1. New Significant DD Results at Cortadera

Hole ID _		Coordinates					Azim	Dip	Hole Depth		Intersection				Interval		Copper		Gold		Silver		Moly		Cu Eq*
		North		East		RL					From		To		(m)		(%)		(g/t)		(ppm)		(ppm)		(%)
CORMET004	6813819		336428		1094		218	-64	1126	548		1032		484		0.4		0.1		0.6		94		0.5
					including					644		700		56		0.8		0.3		1.1		48		1.0
					and including					800		1006		206		0.5		0.2		0.7		173		0.7
					or including					878		922		44		0.8		0.3		1.1		131		1.0

Significant intercepts 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 intercept widths are estimated to be at or around true-widths of mineralisation

Copper Equivalent (CuEq) reported for the drill holes at Cortadera 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). 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. Average fresh rock metallurgical recoveries were Cu=83%, Au=56%, Mo=82%, and Ag=37%.

Figure 2. Location of development study diamond drill holes at Cortadera

Table 2. New Significant DD Results at Productora

Hole ID _		Coordinates					Azim	Dip	Hole Depth		Intersection				Interval		Copper		Gold		Moly		Cu Eq*
		North		East		RL					From		To		(m)		(%)		(g/t)		(ppm)		(%)
MET025	6820931		323027		884		90	-60	280	39		66		27		0.5		0.2		92		0.7
										78		117		39		0.7		0.2		136		0.8
										129		139		10		0.5		0.1		169		0.6
										159		168		9		0.5		0.1		117		0.6
										246		256		10		0.5		0.1		64		0.6
MET026	6822284		323426		816		90	-60	260	93		111		18		0.4		0.1		193		0.5
										120		129		9		0.4		0.1		33		0.5
										141		180		39		0.7		0.2		446		0.9
MET027	6821389		323082		858		90	-62	394.6	36		61		25		0.4		0.1		159		0.5
										100		135		35		0.4		0.1		228		0.5
							including			122		128		6		1.2		0.2		770		1.5
										247		271		24		0.5		0.1		209		0.6
										280		325		45		1.0		0.2		225		1.2
							including			280		288		8		3.0		0.8		699		3.6
MET028	6822576		322851		790		270	-59	250.1	46		85		391		1.0		0.1		31		1.1
										105		115		10		0.5		0.0		71		0.6
										132		142		10		0.5		0.0		36		0.5
										165		175		10		0.3		0.0		175		0.4

Down-hole significant intercept widths are estimated to be at or around true-widths of mineralisation

Copper Equivalent (CuEq) reported for the drill holes at Productora were calculated using the following formula: CuEq% = ((Cu% × Cu price 1% per tonne × Cu_recovery)

1including 3m unsampled outside of metallurgical test area

Figure 3. Location of metallurgical study diamond drill holes at Productora/Alice

Figure 4. Plan view displaying the significant drilling intersection recorded in CORMET004 targeting the north-eastern flank of the high-grade core at Cuerpo 3, Cortadera porphyry discovery.

Figure 5. Cross section (looking north) displaying the new significant drilling intersection recorded in CORMET004 targeting the north-eastern flank of the high-grade core at Cuerpo 3, Cortadera porphyry discovery. Most of the Cu-Au-rich, 484m-long interval is hosted by early- and intra-mineralization tonalite porphyry intrusions, cut by 1 to > 5 % A- and B-type quartz veins, and adjacent pre- mineralization wall-rock.

Figure 6. Cross section (looking north) showing the MET027 significant intersections drilled for metallurgical testwork in the Productora open pit. The highest-grade mineralisation is hosted in the tourmaline breccia unit with lower-grade material in the adjacent felsic volcanic wall-rock.

Figure 7. Cross section (looking north) showing the MET028 significant intersections drilled for metallurgical testwork in the Alice open pit. High grade mineralisation is associated with felsic porphyry hosted limonites (within weathered rock) and intensely sericite altered felsic porphyry (within fresh rock).

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