First Diamond Drillhole Confirms Gold-Rich Major Copper Discovery in Coastal Chile

On November 27, 2025, Hot Chili announced initial assay results from the first diamond drillhole (DKD032) in its Phase two program at the La Verde copper-gold discovery in Chile. The hole, a twin of a previous Reverse Circulation (RC) hole, returned a significant intercept of 528.9 metres grading 0.41% copper (Cu) and 0.21 g/t gold (Au) from 41 metres to the end of the hole.

The company stated the result exceeded expectations and confirms the convergence of higher-grade mineralization at depth, expanding both the vertical and lateral extent of the discovery. The Phase two diamond drilling program, which began in late September, has completed six holes for 2,700 metres, with assays for the remaining five holes pending.

This news is materially positive and represents a significant de-risking event for the La Verde discovery, which is the company's primary growth asset. The analysis of historical news shows a consistent progression of positive exploration results at La Verde, but these were almost exclusively from RC drilling.

• Confirmation and De-risking: RC drilling can be prone to grade inaccuracies. A diamond drillhole confirming and, as the CEO states, "exceeding expectations" of the previous RC drilling provides much higher confidence in the geological model and grade continuity of the deposit. This is a crucial step towards establishing a maiden mineral resource for La Verde.

• Alignment with Strategy: The company raised A$14.1 million in September 2025 specifically to fund this diamond drilling program and advance La Verde towards a resource estimate. This result demonstrates effective use of capital and successful execution of the stated strategy. The goal is to integrate La Verde into the larger Costa Fuego project to add high-grade, near-surface, open-pittable material, which could materially improve the already robust economics outlined in the March 2025 Pre-Feasibility Study (PFS).

• Grade and Scale: An intercept of over 500 metres with grades of 0.41% Cu and 0.21 g/t Au is very strong for a bulk-tonnage copper porphyry system, especially starting from a shallow depth of 41 metres. This reinforces the potential for a large, economically significant deposit.

• Catalyst for Re-rating: The stock price ran from A$0.34 in April to a high of A$1.04 in October on the back of positive exploration updates. After a period of consolidation down to A$0.80, this high-impact news, coupled with the anticipation of five more pending diamond drill assays, could reignite investor interest and drive the stock to re-test its previous highs. The outcome of the pending assays will be critical.

In summary, this is not just another drill result; it is a pivotal confirmation of a major discovery using a more reliable drilling method. It validates the exploration concept, reduces project risk, and sets a very positive precedent for the pending results.

Hot Chili Limited is a copper-gold development company focused on its flagship Costa Fuego project in the coastal range of the Atacama Region, Chile. Costa Fuego is envisioned as a large-scale, long-life copper hub, consolidating the Cortadera, Productora, and San Antonio deposits.

A March 2025 PFS for Costa Fuego outlined a 20-year operation with a post-tax NPV8 of US$1.2 billion and an IRR of 19%, based on a start-up capital cost of US$1.27 billion. The project benefits from its low elevation, proximity to infrastructure, and advanced permitting.

The company's key growth initiative is the La Verde discovery, located 30km south of Costa Fuego. The strategy is to define a significant resource at La Verde and integrate it into the Costa Fuego mine plan to enhance project economics. Hot Chili also holds an 80% interest in the adjacent Huasco Water project, a strategic asset for supplying water to Costa Fuego and potentially other regional users.