Overview
The world is going electric, and that electricity needs to be stored and transported. Copper is a significant player in the electric future, but we might not have enough to go around. The mining industry needs to look decades ahead, but few major new copper mines will be entering production after 2023. Meanwhile, copper demand is expected to double by 2050. Will supply double by then as well? Considering that the past ten years have only added 500,000 tonnes (a two-percent increase) to annual copper production, it’s not likely.
Chile is currently the largest copper producer in the world. The South American country is home to several major players in the copper industry. However, much of the country’s copper rests in the Andes Mountains thousands of metres above sea level, making it extremely difficult to reach and naturally, very expensive. High-altitude mining presents several challenges, including access to water, engineering and permitting, and as previously touched on, a significant increase in capital costs. This is why the coastal plain hosting Costa Fuego in Chile is intriguing — it rests in the foothills of the Andes, at low elevation, and is an ideal location to construct a major project to make a significant contribution to annual copper production.
Hot Chili (ASX:HCH,TSXV:HCH,OTCQX:HHLKF) is a senior exploration and development mining company with a consolidated copper asset on the Chilean coastline. The company is completing a preliminary economic assessment (PEA), which it expects to deliver during the first half of 2023, followed by a Mineral Resource Update in the second half of 2023. Costa Fuego’s pre-feasibility study is expected to be completed in the first half of 2024.
Hot Chili is advancing its Costa Fuego copper project and has major financial backers. It has secured an offtake agreement with copper giant Glencore (OTC:GLEN) shortly after they became the largest shareholder, buying a 9.99 percent stake in Hot Chili in August 2021.
The company’s Costa Fuego Project is known for its indicated resource of 2.8 million tonnes of copper and 2.6 million ounces of gold, as well as an inferred resource of 0.6 million tonnes of copper and 0.4 million ounces of gold. Hot Chili has completed a 47,000-meter resource definition drilling program and updated the mineral resource estimate, as a key step in its ongoing pre-feasibility study.
The asset is ideally located with respect to infrastructure: the planned concentrator is only 55 kilometers away from a significant port and seawater pipeline intake (permit granted); and 18 kilometers from a major power substation; the deposits are split by the dual-lane PanAmerican Highway and are 17 kilometers from a significant mining town, while also being shielded from sight by hills.
After more than a decade of exploration, Hot Chili has conducted over 422,000 meters of drilling across Costa Fuego, and the project is poised to declare its production credentials.
In 2022, Hot Chili was granted access to maritime concession land for Costa Fuego by the Chilean Naval Authority. Access to the coastal land surrounding the maritime concession provides yet another government approval in the company’s regulatory process to develop Costa Fuego.
Hot Chili is led by an experienced management team that imparts confidence in its ability to become a major player in the copper industry. Christian Easterday, CEO and managing director, is an exploration geologist and leader with 20 years of experience working in top-tier companies worldwide. Grant King, COO, is a mining engineer with over 20 years of experience in the mining industry, including 10 years consulting in tier-1 engineering firms. Jose Ignacio Silva, country manager in Chile and chief legal counsel, combines his 15 years of global legal experience with chief geologist Andrea Aravena, who has more than 14 years of experience in the Chilean mining industry, and leads the field team to effectively and efficiently deploy capital into the ground. Along with additional experts, such as Dr. Steve Garwin (chief technical advisor), Dr. John Beeson (lead structural geologist) and Elizabeth Haren (resource development), the management team has all the right skills to lead Hot Chili to success.
The company’s Costa Fuego project is the consolidation of two large deposits, the Cortadera porphyry copper-gold deposit and the Productora copper-gold deposit, along with the small, high-grade deposit at San Antonio. The low-altitude project is in the coast region of Chile and has immediate access to robust power and transportation infrastructure. The company is currently completing a pre-feasibility and additional testing on high-priority projects as it moves towards production.
Hot Chili has secured several new prospective mining rights covering the western extension of Hot Chili’s Cortadera copper-gold discovery. The new mining rights were secured at a low cost through a government-run public auction, recently held for the Huasco region of Chile. Prospective strike length of the existing Cortadera discovery has more than doubled from 2.3 km to 5.2 km with the addition of these new mining rights and those secured through the AMSA option agreement.
In January 2023, drilling commenced across the recently secured western extension to the Cortadera copper-gold discovery. One diamond drill rig (operating on a double-shift basis) and one reverse circulation drill rig (operating on a single-shift basis) are in operation, testing the potential for Cortadera to host a much larger copper porphyry cluster than currently defined. The initial programme, comprising approximately 10,000 meters of drilling, will test four porphyry targets (including three targets on the recently optioned AMSA landholding) added to Cortadera through successful consolidation efforts announced in November 2022.
Management Team
Nicole Adshead-Bell – Independent Non-executive Chairman
Dr. Nicole Adshead-Bell is a geologist with a deep understanding of the mining industry from over 25 years of bridging the gap between the technical, corporate (executive and director), institutional investor and investment banking segments of the business – within an ESG framework. Her career includes CEO of ASX-listed Brazilian gold producer Beadell Resources (prior to its acquisition by Canadian/US listed Great Panther Mining Ltd); director of mining research at Sun Valley Gold LLC (a SEC-registered precious metals-focused fund); and managing director, Investment Banking, Haywood Securities ( Canadian independent investment dealer. While at Haywood she was involved in ~20 public transactions including streaming, mergers, acquisitions and divestitures and raising ~C$1.8 billion in equity/convertible financings. More recently she established Cupel Advisory Corp. to focus on investments and advisory services in the mining sector. Adshead-Bell has over 15 years of cumulative public board experience including exploration, development, operating and royalty companies listed in Canada, USA, Australia and the UK. Adshead-Bell has a PhD in structural/economic geology from James Cook University where she also completed her geology undergraduate and honors degrees. She is currently a non-executive director of TSX-listed Altius Minerals Corp., a diversified royalty company focused on sustainability-related global growth trends including copper, battery metals (lithium, nickel, cobalt), clean iron ore, potash and renewable electricity generation and ASX-listed Matador Mining Ltd, a junior exploration/development company focused on advancing its Cape Ray Gold Project in Newfoundland, Canada.
Christian Ervin Easterday – Managing Director and CEO
Christian Ervin Easterday is a geologist and mineral economist with over 25 years’ experience in the mineral exploration and mining industry. He holds an Honours Degree in Geology from the University of Western Australia, a Masters degree in Mineral Economics from Curtin University of Technology and a Masters Degree in Business Administration from Curtin’s Graduate School of Business.
Easterday has held several senior positions and exploration management roles with top-tier gold companies including Placer Dome, Hill 50 Gold and Harmony Gold, specialising in structural geology, resource development and mineral economic valuation. Over his career, Easterday has been involved in various aspects of project negotiation negotiations and valuations covering gold, copper, uranium, iron ore, nickel, and tantalum resource projects in Australia and overseas.
Easterday is a founding Director of Hot Chili and has led the Company as Managing Director since its listing on the Australian Securities Exchange in 2010. Mr Easterday is a Member of The Australian Institute of Geoscientists
Grant King – Chief Operating Officer
Grant King has 20+ years of experience in the mining industry, including underground contract mining, production roles and consulting for over a decade on mine studies and financial modelling. King holds an Honours Degree in Mining Engineering from the University of Queensland, a Master of Science in Mineral Economics from the Curtin University of Technology and a First Class Mine Manager’s Certificate for the State of Western Australia. Prior to joining Hot Chili, King was a Principal Mining Engineer at the engineering firm Wood and consulted on projects across the Americas, Europe and Australia. He is a Fellow of the Australian Institute of Mining and Metallurgy.
Roberto de Andraca Adriasola – Non-executive Director
Roberto de Andraca Adriasola is a business manager with 25 years experience in the financial and mining business. Over the last five years he has been working in the main iron ore and steel producer in Chile, CAP S A. He also oversaw the construction of the first desalination plant dedicated 100 percent to producing water for mining companies in the north of Chile. de Andraca Adriasola has finance experience working at Chase Manhattan Bank, ABN Amro and Citigroup, working both in Chile and in New York and holds an MBA from the Adolfo Ibanez Business School of Chile. He is a director of Puerto Las Losas, a port in the Atacama Region of Chile. He was elected to the board of directors of CAP S.A. on April 18th, 2017, and until that date he held the position of VP of business development.
Steve Quin – Non-executive Director
Steve Quin is a graduate of the Royal School of Mines, London, with a BSc (Honours) in Mining Geology and has 41 years’ experience in all stages of the mining industry, from exploration to operations and closure. He most recently spent a decade as President & CEO of gold explorer/developer Midas Gold Corp. and, prior to that, President of copper miner Capstone Mining Corp. and, prior to the merger with Capstone, was President & CEO of copper developer and operator Sherwood Copper Corp. Prior to Sherwood, Quin was Executive Vice President of gold producer and explorer Miramar Mining Corp. and its copper exploration affiliate, Northern Orion Exploration. He started his career with what became Imperial Metals Corp. where he was a responsible for the advancement of their polymetallic copper-zinc project. Quin has a combination of technical, governance, and capital markets experience having led multiple studies on projects in the copper and gold sectors, ranging from preliminary economic assessments to feasibility studies, permitting, mine financing and development, operations and closure, and also has experience with base metals and platinum group metal projects.
Quin is a non-executive director of Bravo Mining Corp. and Kutcho Copper Corp. and serves as technical advisor to a number of copper and gold explorers and developers.
Mark Jamieson – Non-executive Director
Mark Jamieson is currently general manager of Resource Engineering for Glencore’s global copper asset group leading technical support and governance in geology, mine engineering and asset optimization for development projects, operations and JV’s. Jamieson brings 20+ years of technical and project experience in open pit and underground operations, including sub-level and block cave mines with Newcrest, MMG and Barrick Gold across Australia, Africa, South East Asia and South America. He holds a bachelor’s degree with honors in geotechnical engineering from RMIT University, and a Master of Engineering Science in mining geomechanics from the University of New South Wales.
Penelope Beattie – Company Secretary and Chief Financial Officer
Penelope Beattie is a chartered accountant with 20 years of experience in corporate and financial services in Africa, Europe, and Australia. She joined the Hot Chili team in November 2021.
José Ignacio Silva – Country Manager and Chief Legal Counsel
José Ignacio Silva gained his law degree at the University of Chile and took his master’s in international business law at the University College London. He has more than 10 years experience in litigation, commercial and mining law, and business negotiations and in Tier 1 law firms in Chile. Silva has also completed two years work experience in London, UK in financial fraud at the Serious Fraud Office, where his team successfully prosecuted a high-level case of corruption of foreign officials. Silva has been working with Hot Chili since July 2009 and in 2011 became chief legal counsel. He is responsible for mining rights acquisitions, mining consolidation, deal negotiations, and business development among other things, working directly with the board of Hot Chili.
Andrea Aravena – Geology Manager, Chile
Andrea Aravena is a geologist from Universidad de Concepción, Chile that has over 13 years of experience working in Chile´s mining and exploration industry. She has also completed further studies in project and operational management at Pontificia Universidad Católica de Chile. Before joining Hot Chili, she worked 4 years as a mine/exploration geologist in open pit and underground gold operations for Yamana and Minera Dayton companies. Aravena joined Hot Chili in 2011 as a senior geologist and has worked extensively supervising and running Productora, El Fuego and more recently Cortadera exploration drill programs, managing the field team and company contractors, ensuring compliance with the company standard operating procedures. Aravena was contributory to the completion of Productora pre-feasibility study and continues supporting legal and environmental permitting for the current company operations.
Kirsty Sheerin – Resource Development Manager
Kirsty Sheerin is a Resource Geologist with over 13 years experience in the mining industry, including underground gold mining and international consulting in resource geology.
She has worked previously as a senior resource geologist for Northern Star Resources and principal geology consultant for OreTeck Mining Solutions.
