Highlights
$40 Million Funding to Accelerate Growth & Development of Costa Fuego
- A$40 million private placement during the quarter received strong demand from Australian, Canadian and
overseas institutional investors, as well as the Company’s three largest shareholders (Glencore, Blue Spec and GS Group). - The Company is now set to deliver strong growth and development milestones for its Costa Fuego coppergold (Cu-Au) project (Costa Fuego) located in coastal Chile, including:
o Delivery of a maiden Mineral Resource at La Verde;
o Integration of La Verde into an expanded mine plan;
o Completion and submission of an Environmental Impact Assessment (EIA); and
o Continuation of Feasibility studies.
Global Engineering Firm Ausenco Appointed for Feasibility Study
Major High-Grade Extensions Continue at La Verde
- Drilling at the Company’s La Verde copper-gold (Cu-Au) porphyry discovery in Chile accelerated during the
quarter, with a second drill rig commencing in February - Widest drill result to date at La Verde, confirms a major extension to the deposits’ rapidly growing high-grade core:
DKD0039 recorded 725 m grading 0.42% CuEq (0.36% Cu, 0.07 g/t Au) from 18 m depth down-hole,
including:
o 22 m grading 0.71% CuEq (0.67% Cu, 0.03 g/t Au) from 42 m depth
o 46 m grading 0.65% CuEq (0.54% Cu, 0.12 g/t Au) from 249 m depth
o 51 m grading 0.62% CuEq (0.51% Cu, 0.10 g/t Au) from 433 m depth
o 62 m grading 1.03% CuEq (0.90% Cu, 0.18 g/t Au) from 671 m depth - Assays pending for thirteen drill holes (seven diamond and six Reverse Circulation (RC)).
Higher-Grade Starter Pit Emerging
- Assay results underpin an emerging, shallow zone of higher-grade Cu-Au mineralisation, outlining a potential
higher-grade starter pit for Costa Fuego - Thirteen significant drill intersections now delineate +0.6% CuEq zone from surface to 250 m depth,
demonstrating strong continuity of higher-grade material. - Additional significant intersections recorded from surface this quarter, included:
DKD036 recorded 150 m grading 0.52% CuEq2 (0.37% Cu, 0.21 g/t Au) from 30 m depth
o Including 38 m grading 0.70% CuEq (0.55% Cu, 0.21 g/t Au) from 117 m
DKD035 recorded 220 m grading 0.47% CuEq (0.37% Cu, 0.14 g/t Au) from 38 m depth
o Including 68 m grading 0.64% CuEq (0.52% Cu, 0.15 g/t Au) from 187 m
Strong Cash Position of A$35.2M
Diamond and RC Drill rigs accelerating development of the La Verde Cu-Au discovery
SUMMARY OF OPERATIONAL ACTIVITIES
Major High-Grade Extensions Continue at La Verde
Phase two diamond drilling continued during the quarter at the Company’s La Verde copper-gold (Cu-Au) porphyry discovery in Chile (La Verde). Drilling focused on continuing to expand the mineralized discovery footprint.
Results were stronger than anticipated, with the depth extent doubling to 800 m from surface – significantly expanding the high-grade core laterally and up to surface.
A standout significant intersection of 725 m grading 0.42% CuEq1 from 18 m depth has been recorded in diamond drill hole DKD039, which was collared on the western extent of La Verde’s discovery footprint (Figure 1), and
intersected multiple wide zones of +0.6% CuEq1 mineralization from near surface (Figure 2 and 3).
As the most significant result to date at La Verde, importantly, DKD039 achieved two key objectives:
- Further extended near-surface higher-grade mineralization by approximately 60 m to the west – recording 22m grading 0.71% CuEq1 from 42 m depth within a wider intersection of 48 m grading 0.55% CuEq (0.50% Cu, 0.03 g/t Au) from 18 m depth, located immediately beneath shallow gravel cover, and
- Confirmed a significant 200 m down-dip extension of La Verde’s high-grade core – recording 61 m grading
1.03% CuEq1 (0.90% Cu, 0.18 g/t Au, 1.81g/t Ag) from 671 m in association with high Cu/Au, A+B vein
abundances >5% and massive and disseminated chalcopyrite (Figure 2).
Continued expansion and integration of La Verde’s high-grade core into Costa Fuego’s resource base and mining inventory is a priority this year.
Higher-Grade Cu-Au Starter Pit Emerging
Diamond drilling at La Verde has continued to test the shallow up-dip potential of La Verde’s high-grade core, with significant intersections returned from drill holes DKD035, DKD036, DKD037 and DKD038.
A 450 m x 400 m higher-grade, near-surface copper-gold zone has been defined by thirteen significant intersection
+0.6% CuEq at La Verde (Figure 4), including most recently:
- DKD036 recorded 150 m grading 0.52% CuEq (0.37% Cu, 0.21 g/t Au) from 30 m depth
o Including 38 m grading 0.70% CuEq (0.55% Cu, 0.21 g/t Au) from 117 m, and - DKD035 recorded 220 m grading 0.47% CuEq (0.37% Cu, 0.14 g/t Au) from 38 m depth
o Including 68 m grading 0.64% CuEq (0.52% Cu, 0.15 g/t Au) from 187 m
Similar to previous near-surface drill intersections, these latest significant results commence immediately beneath
shallow gravel cover, indicating the potential for simple, cost-effective overburden removal in a future open pit
development.
These results have the potential to contribute to a higher-grade starter pit for the Costa Fuego mine schedule,
significantly reducing payback and positively impacting key financial metrics of Hot Chili’s March 2025 Pre-Feasibility Study.
Confirming Bulk Tonnage Continuity
Further assay results reported during the quarter continue to confirm continuity of bulk tonnage mineralisation at La Verde, including:
- DKD037 recorded 184 m grading 0.42% CuEq1 (0.32% Cu, 0.12 g/t Au) from 105 m depth
o including 22 m grading 0.60% CuEq (0.48% Cu, 0.15 g/t Au) from 203 m - DKD038 recorded 221 m grading 0.37% CuEq1(0.29% Cu, 0.11 g/t Au) from 48 m depth
o including 45 m grading 0.51% CuEq (0.37% Cu, 0.19 g/t Au) from 53 m
Drill hole DKD037 was designed to target a gap between two higher-grade zones, with assay results now confirming
expansion and continuity of mineralisation across this zone (Figure 2). The significant intersection from DKD038 also
commences immediately beneath shallow gravel cover (Figure 3).
La Verde Footprint Expands Further
During the quarter the diamond drill rig also completed four diamond drill tails, extending the mineralisation footprint
reached by the RC drilling in Phase 1, which ended in mineralization.
Assay results from diamond drill tail DKP009D extended La Verde’s Cu-Au mineralisation footprint along the eastern
flank of the discovery in the north (Figures 1 and 3). The drill hole was a 200 m diamond tail to earlier RC drill hole
DKP009 and reported 68 m grading 0.42% CuEq (0.33% Cu, 0.11 g/t Au) from 354 m depth, extending mineralisation
downhole of DKP009.
Similarly, diamond drill tail DKP012D extended the mineralization footprint along the northern flank of the discovery.
The drill hole was a 284 m diamond tail to earlier RC drill hole DKP012 and reported 132 m grading 0.36% CuEq
(0.26% Cu, 0.05 g/t Au) from 306 m depth extending mineralization downhole of DKP012. Several higher-grade
zones were intercepted in the tail, confirming the system is still open and mineralized to the north and will be followed
up with additional drilling along the interpreted NNE-trending structural corridor (Figure 2 and 4).
DKP006D and DKP021D extended the mineralisation along the eastern flank of the discovery in the south, with
DKD021D recording an additional 54 m grading 0.42% CuEq (0.34% Cu, 0.11 g/t Au) from 593 m depth, including
19 m grading 0.66% CuEq (0.51% Cu, 0.21 g/t Au) from 593 m depth.
Including the new diamond tail extensions:
- DKP009D now records 388 m grading 0.41% CuEq (0.32% Cu, 0.12 g/t Au) from 34 m
- DKP012D now records 394 m grading 0.46% CuEq (0.35% Cu, 0.11g/t Au) from 44 m
- DKP021D now records 194 m grading 0.32% CuEq (0.26% Cu, 0.06 g/t Au) from 284 m
- DKP006D now records 110 m grading 0.39% CuEq (0.27% Cu, 0.15 g/t Au) from 76 m
Diamond drilling has been instrumental in development of an early “4D litho-structural model” by the Company, with the interpretation of multiple intrusive phases optimizing drill target design. Hot Chili geologists are applying the same targeting strategies that proved successful at the Company’s nearby Cortadera Cu-Au porphyry Resource and anticipate these methods will continue to drive growth at La Verde.
1 Copper Equivalent (CuEq) reported for the drill hole intersections 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 × Cu_recovery). The Metal Prices applied in the calculation were: Cu=4.50 USD/lb, Au=3,150 USD/oz, Mo=20 USD/lb, and Ag=30 USD/oz. The entirety of the intersection is assumed as fresh. The recovery and copper equivalent formula for La Verde uses Cortadera as a proxy, which is considered reasonable given both the similar mineralisation style and amenability testwork completed thus far at La Verde – Recoveries of 83% Cu, 56% Au, 83% Mo and 37% Ag. CuEq (%) = Cu(%) + 0.69 x Au(g/t) + 0.00044 x Mo(ppm) + 0.0043 x Ag(g/t).
Development Studies Progressing
Global engineering firm Ausenco – with offices in Chile and Australia – has been appointed as the lead engineering group to progress the Feasibility Study for the Costa Fuego project. The appointment follows a review of major engineering groups in Chile, with Ausenco’s impressive execution of engineering, procurement, construction and ramp-up of the nearby, similar-scale, coastal project Mantoverde, a key factor in the decision.
Figure 1. Plan view map of La Verde showing returned diamond drilling compared with updated +0.2% copper
(yellow), +0.3% copper (red), +0.4% copper (magenta) mineralization interpolants. Drilled holes with pending
assays are shown in black. Position of A – A’ cross section (Figure 3) and B – B’ long section (Figure 4) annotated
in black. Conceptual open pit shells1 displayed for $US3.50/lb Cu (blue) and $US6.00/lb Cu (green) displayed as
dashed lines. Results reported including CuEq2
1 See Page 23 of this announcement for detail on the US$3.50 Cu and US$6.00 Cu conceptual open pit shells (Exploration Targets). Any potential tonnage and grade of the Target shown is conceptual in nature. There has been insufficient exploration to estimate a Mineral Resource within the target area, and it is uncertain if further exploration will result in the estimation of a Mineral Resource.
2 Copper Equivalent (CuEq) reported for the drill hole intersections 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 × Cu_recovery). The Metal Prices applied in the calculation were: Cu=4.50 USD/lb, Au=3,150 USD/oz, Mo=20 USD/lb, and Ag=30 USD/oz. The entirety of the intersection is assumed as fresh. The recovery and copper equivalent formula for La Verde uses Cortadera as a proxy, which is considered reasonable given both the similar mineralisation style and amenability testwork completed thus far at La Verde – Recoveries of 83% Cu, 56% Au, 83% Mo and 37% Ag. CuEq (%) = Cu(%) + 0.69 x Au(g/t) + 0.00044 x Mo(ppm) + 0.0043 x Ag(g/t).
Figure 2. Cross section slice along DKD039 (± 75m clipping) showing +0.2% copper (yellow), +0.3% copper (red),+0.4% copper (magenta) mineralization interpolants and returned assay results for DKD039, DKP012D, DKD037, DKP009D1. Returned Cu grades shown on hole traces.
1 Copper Equivalent (CuEq) reported for the drill hole intersections 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 × Cu_recovery). The Metal Prices applied in the calculation were: Cu=4.50 USD/lb, Au=3,150 USD/oz, Mo=20 USD/lb, and Ag=30 USD/oz. The entirety of the intersection is assumed as fresh. The recovery and copper equivalent formula for La Verde uses Cortadera as a proxy, which is considered reasonable given both the similar mineralisation style and amenability testwork completed thus far at La Verde – Recoveries of 83% Cu, 56% Au, 83% Mo and 37% Ag. CuEq (%) = Cu(%) + 0.69 x Au(g/t) + 0.00044 x Mo(ppm) + 0.0043 x Ag(g/t).
Figure 3. NNW facing longitudinal section of the La Verde porphyry system showing +0.2% copper (yellow), +0.3% copper (red), +0.4% copper (magenta) mineralization interpolants. Returned Cu grades shown on hole traces. Drilled holes with pending assays are shown in black.
1 Copper Equivalent (CuEq) reported for the drill hole intersections 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 × Cu_recovery). The Metal Prices applied in the calculation were: Cu=4.50 USD/lb, Au=3,150 USD/oz, Mo=20 USD/lb, and Ag=30 USD/oz. The entirety of the intersection is assumed as fresh. The recovery and copper equivalent formula for La Verde uses Cortadera as a proxy, which is considered reasonable given both the similar mineralisation style and amenability testwork completed thus far at La Verde – Recoveries of 83% Cu, 56% Au, 83% Mo and 37% Ag. CuEq (%) = Cu(%) + 0.69 x Au(g/t) + 0.00044 x Mo(ppm) + 0.0043 x Ag(g/t).
Figure 4. Plan view slice at 1025 m, clipped to +/- 125 m (surface is ~1150 mRL). Significant intersections are shown for the entire drill hole, where available. 13 drill intersections +0.6% CuEq inform the high-grade core within 250 m of surface. Drill holes with pending assays are shown in black. Updated +0.2% copper (yellow), +0.3% copper (red), +0.4% copper (magenta) mineralization interpolants included, drill hole intervals bolded by 0.6% CuEq1.
1 Copper Equivalent (CuEq) reported for the drill hole intersections 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 × Cu_recovery). The Metal Prices applied in the calculation were: Cu=4.50 USD/lb, Au=3,150 USD/oz, Mo=20 USD/lb, and Ag=30 USD/oz. The entirety of the intersection is assumed as fresh. The recovery and copper equivalent formula for La Verde uses Cortadera as a proxy, which is considered reasonable given both the similar mineralisation style and amenability testwork completed thus far at La Verde – Recoveries of 83% Cu, 56% Au, 83% Mo and 37% Ag. CuEq (%) = Cu(%) + 0.69 x Au(g/t) + 0.00044 x Mo(ppm) + 0.0043 x Ag(g/t).
Table 1. Drill Holes Completed for La Verde in Quarter 1 2026
Table 2. Significant Drilling Intersections from La Verde in Quarter 1 2026
Notes to Table 1: Significant intercepts for La Verde are reported above a nominal cut-off grade of 0.20% Cu. Reported intersections may include internal dilution (intervals below 0.20% Cu), including zones exceeding 30 m downhole width, where the overall weighted average grade of the intersection remains above the cut-off grade. Significant intersections are separated where zones of internal dilution result in discrete intervals that do not meet the reporting criteria. The selection of a 0.20% Cu cut-off grade is aligned with a marginal economic cut-off for bulk tonnage polymetallic copper deposits of comparable grade in Chile and globally. Significant intersection widths (interval) have been rounded to the nearest metre.
1 Copper Equivalent (CuEq) reported for the drill hole intersections 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 × Cu_recovery). The Metal Prices applied in the calculation were: Cu=4.50 USD/lb, Au=3,150 USD/oz, Mo=20 USD/lb, and Ag=30 USD/oz. The entirety of the intersection is assumed as fresh. The recovery and copper equivalent formula for La Verde uses Cortadera as a proxy, which is considered reasonable given both the similar mineralization style and amenability testwork completed thus far at La Verde – Recoveries of 83% Cu, 56% Au, 83% Mo and 37% Ag. CuEq (%) = Cu(%) + 0.69 x Au(g/t) + 0.00044 x Mo(ppm) + 0.0043 x Ag(g/t).
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