Hot Chili taps into seawater to unlock copper-rich | Australian Markets

Hot Chili Limited is making a splash in Chile’s dry north with a preliminary feasibility research on a billion-dollar infrastructure play that might unlock one of the world’s richest undeveloped copper areas by fixing its largest drawback – water.

With a commanding 80 per cent stake, Hot Chili is the driving power behind the Huasco Water project, co-funded by Chilean iron ore powerhouse Compañía Minera del Pacifico (CMP). CMP holds the remaining share.

According to management, the project holds the one lively maritime licence in all the Huasco area – a prized asset that took a decade of crimson tape to secure.

The three way partnership (JV) is now setting its sights on building a long-term, regional, multi-user water community that may pump sea and desalinated water throughout Chile’s Southern Atacama area.

The imaginative and prescient is aimed toward reworking the drought-stricken Huasco Valley, 600 kilometres north of the nation’s capital Santiago, into a hub of sustainable mining, agriculture and neighborhood development. In a area the place water is as valuable as copper, the project dangles a uncommon promise of long-term, industrial-scale entry to sea and desalinated water.

The research itself has delivered a cracking set of numbers, backing what Hot Chili believes could possibly be a game-changer for copper miners, farmers and native communities in Chile’s parched Atacama.

The bold multi-stage plan goals to kick off with a US$151 million (A$232M) first section spend to pump 500 litres of uncooked seawater per second (L/s) by way of a single pipeline, operating 62km from the Pacific Ocean to Hot Chili’s flagship 1.5-million-tonne Costa Fuego copper-gold project.

Alongside its coveted seawater extraction concessions, Huasco Water has secured key coastal land entry and easements for its pipeline and locked into the ability grid.

With the groundwork laid, the company is aiming to have seawater flowing by way of its community by the tip of the last decade, setting the stage for a full-scale rollout in a single of the driest areas on Earth.

The project’s economics are simply as spectacular because the engineering, with the research tipping a 4.5-year payback and a post-tax internet current worth of US$122M (A$187M) over its initial 20-year life, utilizing an 8 per cent low cost fee.

Notably, the plan is already backed by a signed memorandum of understanding and positions Costa Fuego as the muse off-taker for the project’s first section.

Stage two is set to flip the taps on even wider. By spending a additional US$1.4 billion (A$2.15B), the expanded project will introduce a modular reverse osmosis desalination plant into the image, succesful of supplying 1300L/s.

According to the pre-feasibility research, the total build-out might ship more than US$4B (A$6.15B) in post-tax free money stream throughout levels one and two, eclipsing the incomes potential of the company’s copper project.

A raft of potential purchasers – together with Teck and Newmont’s Nueva Union copper project and CMP’s Los Colorados iron ore mine – have already signed MOUs for a mixed 665L/s. Total demand estimates exceed 4000L/s.

The kicker is a third stage, which goals to push desalinated provide to 2300L/s by 2050 and past, extending the pipeline community deep into the Andes to feed the huge Valeriano and Vicuña copper mines, along with different world-class deposits.

The outcomes of the water provide preliminary feasibility research present an alternative for Hot Chili to absolutely contemplate the strategic worth of its 80 per cent owned subsidiary company Huasco Water, which controls all our important water property.

Environmental approvals are nicely superior, with marine impression research, leak detection technology and neighborhood engagement packages already baked into the design. The pipeline route avoids delicate ecosystems and the system is appropriate with renewable power inputs.

In a market the place water equals manufacturing – and manufacturing equals billions in copper – Hot Chili’s Huasco Water project is more than infrastructure. It’s the lacking piece of the puzzle that might ignite a mining growth in a single of essentially the most resource-rich, water-starved areas on the planet.

And within the race to provide the world’s clean power transition with copper, whoever controls the water simply would possibly control the longer term.

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