Hot Chili raising up to $8.9m, poised to restart Cortadera exploration
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Special Report: Hot Chili’s exciting Cortadera copper-gold project in Chile has clearly caught investor attention with the closing of a $5m private placement that was overbid.
The placement of shares priced at 1.5c each, with one attaching option exercisable at 2.5c expiring on May 20 2022 for every two shares, was closed within a day due to strong demand from institutional and high net worth investors in Australia.
Hot Chili (ASX:HCH) is also raising a further $3.9m through a rights issue offering eligible shareholders up to 3 shares for every 20 shares held under the same terms as the private placement.
The high demand for the placement highlights the ongoing exploration success that the company has enjoyed at Cortadera.
Recent results included a 100m step-out hole which recorded 542m grading 0.5 per cent copper and 0.2 grams per tonne (g/t) gold from 422m down-hole that includes a higher-grade zone of 218m at 0.7 per cent copper and 0.2g/t gold with additional silver and molybdenum credits.
Proceeds from the placement will be used to pay private Chilean mining group SCM Carola $US2m ($3.1m) to extend the payment schedule for Hot Chili’s acquisition of Cortadera by twelve months.
Hot Chili now has until mid-July 2021 to pay the next $US10m and mid-July 2022 to pay the remaining $US15m.
Funds will be used to restart drilling at the project and define a maiden resource for both the Cortadera and San Antonio projects, complete metallurgical testwork and a preliminary economic assessment, and execute a formal lease mining and processing agreement with Chile’s Empresa Nacional de Mineria (ENAMI) for ore from its Productora copper-gold project.
Managing director Christian Easterday says the funding facilitates a major re-positioning of the company’s copper and gold resource base and the recommencement of drilling across large extensions to the Cortadera discovery.
“With each hole, the Cortadera discovery has expanded — delivering six world class, copper-gold drill results already and still remaining open,” he noted.
“I am very pleased with the strong funding support we have received, in addition to providing all shareholders the ability to participate in this exciting phase of growth for our company.”
Hot Chili already has five expansion drill hole pre-collars completed and ready to go.