ASX-listed aspiring Chile copper developer, Hot Chili, has been granted water extraction rights for its overarching Costa Fuego porphyry copper-gold project located about 600 kilometres north of the country’s capital, Santiago, following an exhaustive seven-year application process.
The maritime concession approved by Chilean authorities allows the Perth-based company to extract seawater from the Pacific Ocean approximately 60km west of the potential Costa Fuego coastal development in Chile.
Hot Chili says the extraction rights represent a critical infrastructure requirement for Costa Fuego, securing sufficient water supply to support a large-scale conventional copper-gold mining and processing operation.
The company has attributed a mammoth global indicated and inferred mineral resource estimate to Costa Fuego – based on combining the Cortadera and Productora porphyry deposits – of 724 million tonnes of ore going an average grade of 0.48 per cent copper equivalent for 2.87 million tonnes of contained copper, 2.72 million ounces of contained gold and 9.86 million ounces of silver.
Hot Chili unveiled the maiden resource for Cortadera a couple of months ago. It comprised 451 million tonnes at 0.46 per cent copper equivalent for 1.66 million tonnes of contained copper, 1.91 million ounces of gold and 9.86 million ounces of silver.
A pre-feasibility study, or “PFS” undertaken by Hot Chili four years ago on the possible development of Productora incorporated the extraction of seawater via a 62km buried water pipeline from the coast to Productora.
The seawater pipeline design is now planned to be extended to Cortadera, as the new operating centre for the combined Costa Fuego development.
According to Hot Chili, metallurgical test work to date on Costa Fuego ore has realised strong metal recoveries using seawater processing.
Broking house Veritas Securities suggests a Costa Fuego development scenario would likely involve a central processing facility at Cortadera with Productora ore transported via 14km conveyor belt.
Veritas views the possible combined development of Cortadera and Productora as similar to the NuevaUnion project development owned by Teck Resources and Newmont Goldcorp that envisages combining the Relincho and El Morro copper-gold deposits into one operation via a 40km conveyor belt.
Hot Chili’s Cortadera deposit lies 14km from the Productora deposit. As part of the Productora PFS, Veritas noted that the company secured existing infrastructure access for power and seawater pipeline easements and surface rights.
Veritas describes Costa Fuego as an emerging copper project with the hallmarks to grow into a Tier 1 asset.
Hot Chili last week squared away a $25 million capital raise that enables it to fund a massive 40,000m follow-up drilling campaign next year as well as make an instalment payment to maintain full ownership of the Cortadera project.
The bulk-tonnage mining and processing nature of the potential Costa Fuego project and the economies of scale and CAPEX attached to such a development proposition may mean Hot Chili may look to a lending hand down the track, according to Veritas.
Is your ASX listed company doing something interesting? Contact: firstname.lastname@example.org