ASX Announcement Wednesday 27th January 2021

High Grade Copper-Gold Core Continues to Expand at Cortadera

40,000m Drill Programme Underway


Highlights

  • Fully funded 2021 drill programme commenced at the Cortadera copper-gold discovery in Chile
  • Two drill rigs) in operation with a third drill rig planned to start in February
  • Significant new drill results confirm continuity and extensions to the high grade core of the main porphyry at Cortadera (Cuerpo 3) – a key focus for a targeted major resource upgrade this year

                                Significant Drill Result for CRP0052D                         

382m grading 0.4% copper & 0.1g/t gold

from 524m down-hole depth

including

80m grading 0.6% copper & 0.2g/t gold

(plus additional silver and molybdenum credits)

          Wide Visual Result from Current Diamond Hole CRP0046D          

750m of Porphyry Mineralisation Recorded
from 250m to 1,000m down-hole depth, hole planned to 1,200m

Results Pending

• Two wide zones of strongly mineralised porphyry recorded in current diamond drill hole CRP0046D, from 250m to 350m (100m zone) and 550m and 720m (170m zone) downhole depth


• CRP0046D is currently at 1,000m depth in porphyry mineralisation and is planned to extend to 1,200m


• Reverse circulation drilling is advancing across several growth targets at Cuerpo 1 and Cuerpo 4


• Clearing at Cortadera North is on-track and drilling is expected to commence in February


Hot Chili Limited (ASX code HCH) (“Hot Chili” or “Company”) is pleased to announce the commencement of a 40,000m drilling programme at the Cortadera copper-gold porphyry discovery, part of the Company’s Costa Fuego coastal range copper development in Chile.


The Company’s fully funded 2021 work programme aims to continue building Costa Fuego toward a tier one copper project (+5Mt copper) from its current contained metal resource base of 2.9Mt copper and 2.7Moz gold.


Drilling has been significantly accelerated from last year with two drill rigs currently in operation and a third rig expected to commence shortly in February.


New results from drilling designed to expand the main high grade core at Cortadera have returned another set of strong intersections.

New Results Continue to Expand the Main High Grade Core at Cortadera

A primary focus for the Company in 2021 is to expand the high grade core (defined as >0.6% CuEq*), currently sitting at 104Mt at 0.74% CuEq (as reported to ASX on 12th October 2020), within Cortadera’s 451Mt Mineral
Resource.

Diamond drill hole CRP0052D returned a higher grade intersection of 80m grading 0.6% copper and 0.2g/t gold within a broader zone of 382m grading 0.4% copper and 0.1g/t gold from 524m down-hole depth along the south-eastern extent of the high grade core to the main porphyry (Cuerpo 3).

In addition, the Company has recorded an exceptionally wide 750m interval of porphyry mineralisation from a down-hole depth of 250m in diamond drill hole CRP0046D. The hole is currently at 1,000m in porphyry mineralisation and is planned to extend to 1,200m at this stage.

Importantly, within the wide 750m visual interval of mineralisation, two zones of strongly mineralised porphyry have been recorded:

  • 100m wide zone between 250m and 350m depth down-hole, and
  • 170m wide zone between 550m and 720m depth down-hole

Both zones of strongly mineralised porphyry comprise visual estimates of 1.0% – 2.5% chalcopyrite contained as fine dissemination and in association with 2% to 15% B-vein abundance. Visual estimates of sulphide minerals are not an accurate representation of expected assay value and are provided for indicative purposes only.

Importantly, the results provide confidence for further growth in predictive extensional areas where the high grade core is absent from Cortadera’s maiden resource owing to low or no drilling density.

Acceleration of Drilling Operations at Cortadera

The Company commenced a major drilling campaign at Cortadera on 11 th January 2021 initially utilising two drill rigs with a third drill rig set to arrive in February.

Each drill rig will focus on key growth areas within the Cortadera discovery window as well as other large satellite growth opportunities:

Diamond drill rig 1 (in operation)

• Focus on Cuerpo 3 resource addition: bulk expansion and high grade growth
• Currently drilling CRP0046D, a further 8 holes planned

Diamond drill rig 2 (planned to start in February)

• Focus on large growth potential within the Cortadera discovery window outside of Cuerpo 3

• Three deep pre-collar holes complete and ready to test Cuerpo 2 and gap zone, a further five holes planned

Reverse Circulation drill rig 1 (in operation)

• Focus on Cuerpo 1 and Cuerpo 4 open pit targets, pre-collar drilling and new large growth opportunities (Cortadera North etc)
• Currently drilling at Cortadera and planned to move to Cortadera North in February

The Directors look forward to an exciting year of news flow and the opportunity to continue growing Cortadera as one of the most significant global copper discoveries of recent time.

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 Email: christian@hotchili.net.au

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

Table 1 New Significant DD Drill Results at Cortadera

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

Refer to ASX Announcement “Costa Fuego Becomes a Leading Global Copper Project” (12th October 2020) for JORC Table 1 information related to the Cortadera JORC compliant Mineral Resource estimate by Wood and the Productora re-stated JORC compliant Mineral Resource estimate by AMC Consultants

* 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=1,550 USD/oz, Mo=12 USD/lb, and Ag=18 USD/oz. For Cortadera (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%. For Costa Fuego (Inferred + Indicated), the average Metallurgical Recoveries were: Cu=83%, Au=51%, Mo=67% and Ag=23%.

** Reported on a 100% Basis – combining Cortadera and Productora Mineral Resources using a +0.25% CuEq reporting cut-off grade

Figure 2 Plan view across the Cortadera discovery area displaying significant historical copper-gold DD intersections across Cuerpo 1, 2, 3 and 4 tonalitic porphyry intrusive centres (represented by modelled copper envelopes, yellow- +0.1% Cu and majenta +0.4% Cu). Note the selected HCH drilling intersections (White) and the new results reported from CRP0046D and CRP0052D (Red).

Figure 3 Plan view across the Cortadera discovery area displaying significant historical copper-gold DD intersections across Cuerpo 2 and 3. The plan view displays the Mineral Resource extents (represented by modelled copper envelope, yellow- +0.1% Cu). Note the selected HCH drilling intersections (White) and the new results reported from CRP0052D and CRP0046D (Red collars) as well as the location of planned deep diamond tails (white traces)

Figure 4. Plan view displaying the location of the Cortadera discovery zone in relationnto the Cortadera North target. The plan displays the location of Cuerpo 1, 2, 3 and 4 tonalitic porphyry intrusive centres (represented by modelled copper envelopes, yellow- +0.1% Cu) in relation to surface molybdenum anomalism and IP chargeability response at 200m depth slice. Cortadera North, located 2km north of Cortadera displays “look alike” characteristics to the Cortadera discovery. Note locations of planned first pass RC drill holes at Cortadera North in a addition to Cuerpo 1 and Cuerpo 4. An RC drill rig is currently in operation north of Cuerpo 1.

Qualifying Statements

Independent JORC Code Costa Fuego Combined Mineral Resource (Reported 12th October 2020)

Reported at or above 0.25% CuEq*. Figures in the above table are rounded, reported to appropriate significant figures, and reported in accordance with the JORC Code – Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Metal rounded to nearest thousand, or if less, to the nearest hundred. * * 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=1,550 USD/oz, Mo=12 USD/lb, and Ag=18 USD/oz. For Cortadera (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%. For Costa Fuego (Inferred + Indicated), the average Metallurgical Recoveries were: Cu=83%, Au=51%, Mo=67% and Ag=23%.

** Note: Silver (Ag) is only present within the Cortadera Mineral Resource estimate

Competent Person’s Statement- Exploration Results

Exploration information in this Announcement is based upon work compiled by Mr Christian Easterday, the Managing Director and a full-time employee of Hot Chili Limited whom is a Member of the Australasian Institute of Geoscientists (AIG). Mr Easterday has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a ‘Competent Person’ as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’ (JORC Code). Mr Easterday consents to the inclusion in the report of the matters based on their information in the form and context in which it appears.

Competent Person’s Statement- Productora Mineral Resources

The information in this Announcement that relates to the Productora Project Mineral Resources, is based on information compiled by Mr N Ingvar Kirchner. Mr Kirchner is employed by AMC Consultants (AMC). AMC has been engaged on a fee for service basis to provide independent technical advice and final audit for the Productora Project Mineral Resource estimates. Mr Kirchner is a Fellow of the Australasian Institute of Mining and Metallurgy (AusIMM) and is a Member of the Australian Institute of Geoscientists (AIG). Mr Kirchner has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’ (the JORC Code 2012). Mr Kirchner consents to the inclusion in this report of the matters based on the source information in the form and context in which it appears.

Competent Person’s Statement- Cortadera and Costa Fuego Mineral Resources

The information in this report that relates to Mineral Resources for the Cortadera and combined Costa Fuego Project is based on information compiled by Elizabeth Haren, a Competent Person who is a Member and Chartered Professional of the Australasian Institute of Mining and Metallurgy and a Member of the Australian Institute of Geoscientists. Elizabeth Haren is employed as an associate Principal Geologist of Wood, who was engaged by Hot Chili Limited. Elizabeth Haren has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as a
Competent Person as defined in the 2012 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves”. Elizabeth Haren consents to the inclusion in the report of the matters based on her information in the form and context in which it appears.

Reporting of Copper Equivalent

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=1,550 USD/oz, Mo=12 USD/lb, and Ag=18 USD/oz. For Cortadera (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%. For Costa Fuego (Inferred + Indicated), the average Metallurgical Recoveries were: Cu=83%, Au=51%, Mo=67% and Ag=23%.

Forward Looking Statements

This Announcement is provided on the basis that neither the Company nor its representatives make any warranty (express or implied) as to the accuracy, reliability, relevance or completeness of the material contained in the Announcement and nothing contained in the Announcement is, or may be relied upon as a promise, representation or warranty, whether as to the past or the future. The Company hereby excludes all warranties that can be excluded by law. The Announcement contains material which is predictive in nature and may be affected by inaccurate assumptions or by known and unknown risks and uncertainties and may differ materially from results ultimately achieved.

The Announcement contains “forward-looking statements”. All statements other than those of historical facts included in the Announcement are forward-looking statements including estimates of Mineral Resources. However, forward-looking statements are subject to risks, uncertainties and other factors, which could cause actual results to differ materially from future results expressed, projected or implied by such forward-looking statements. Such risks include, but are not limited to, copper, gold and other metals price volatility, currency fluctuations, increased production costs and variances in ore grade recovery rates from those assumed in mining plans, as well as political and operational risks and governmental regulation and judicial outcomes. The Company does not undertake any obligation to release publicly any revisions to any “forward-looking statement” to reflect events or circumstances after the date of the Announcement, or to reflect the occurrence of unanticipated events, except as may be required under applicable securities laws. All persons should consider seeking appropriate professional advice in reviewing the Announcement and all other information with respect to the Company and evaluating the business, financial performance and operations of the Company. Neither the provision of the Announcement nor any information contained in the Announcement or subsequently communicated to any person in connection with the Announcement is, or should be taken as, constituting the giving of investment advice to any person

Appendix 1. JORC Code Table 1 for Cortadera

Section 1 Sampling Techniques and Data

Section 2 Reporting of Exploration Results

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