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Hot Chili executes option to acquire Cometa Project in Chile

Published by , Editorial Assistant
Global Mining Review,

Hot Chili Limited has announced that it has executed an Option Agreement with Bastion Minerals Limited for the right to acquire 100% of Bastion’s Cometa Project in Chile, located near Hot Chili’s Costa Fuego Copper-Gold Project in the coastal range of the Atacama Region, Chile.

Cometa consists of exploration and mining concessions covering approximately 56 km2 in area located approximately 15 km southeast of Costa Fuego’s planned operating centre and contiguous with Hot Chili’s landholdings in the region.

Historical work by Bastion and previous explorers, including surface mapping, soil and rock sampling, and ground geophysics, identified several targets prospective for the discovery of breccia-hosted and iron oxide-copper-gold mineralisation. Should further exploration prove successful, any potential future Mineral Resources may be processed at Hot Chili’s planned centralised processing facilities.

Execution of the Option follows successful due diligence and is another step in Hot Chili’s consolidation strategy for the Costa Fuego copper project.

The material terms of the Option are as follows:

  • Non-refundable cash payment of US$100 000 to Bastion has been satisfied upon grant and execution of the Option.
  • Non-refundable cash payment of US$200 000 within 12 months from the grant of the Option to keep the Option in good standing.
  • Option may be exercised within 30 months of the date of grant.
  • If the Option is exercised, the consideration payable to Bastion to purchase the Cometa concessions is:
    • US$2 400 000 if the Option is exercised by Hot Chili within 18 months from the date of grant of the Option; or
    • US$3 000 000 if the Option is exercised by Hot Chili within 30 months from the date of grant of the Option.
  • Hot Chili may, subject to applicable regulatory approvals, including the approval of the TSX Venture Exchange (TSXV), elect to satisfy the purchase consideration in cash (100%), or in cash (50%) and ordinary shares of Hot Chili (50%) issued at a price per share equal to the greater of (i) the 15 day VWAP at the date of exercise of the Option, and (ii) the minimum price permitted by the TSXV.

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South American mining news