In March, Hot Chili unveiled a game-changing pre-feasibility study for the project, placing it among the world’s top-tier copper developments.
Running across a 20-year mine life, production is forecast to average 95,000t of copper and 48,000 ounces of gold per year for the first 14 years. At an assumed conservative copper price of US$4.30 (A$6.58) per pound, the project has a net present value of US$1.2 billion (A$1.8 billion).
The study also estimated life-of-mine free cash flow of US$3.86 billion (A$5.9 billion) and a total projected revenue of US$17.3 billion (A$26.4 billion), firmly cementing Costa Fuego as a world-class asset with immense leverage to rising copper and gold prices.
Following the completion of a pre-feasibility study for both its Costa Fuego copper project and the company’s Huasco water project, Hot Chili kicked off a high-stakes strategic partnering process to help finance the company’s various projects in Chile.
It retained BMO Capital Markets as a corporate advisor to run the ruler over potential suitors and says that multiple non-binding, indicative and conditional proposals are currently under review. Some of the new cash will go towards completing that process.
The balance of the new funds has been earmarked for ongoing development and exploration studies to keep the momentum going across the Costa Fuego project, as the global copper supply squeeze intensifies.
With its balance sheet topped up and drill rigs on standby, Hot Chili is turning up the heat on Costa Fuego as the copper market keeps sizzling.
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