Hot Chili Announces PFS for Huasco Water & MOU for Seawater Supply to Costa Fuego

Core Insights - The article discusses the economic potential and strategic advantages of Huasco Water, a joint venture between Hot Chili and Compañia Minera Del Pacifico, which has secured the only active maritime license to supply seawater in the Huasco Valley region [6][18][19] Financial Projections - Stage 1 of the water supply project has a post-tax Net Present Value (NPV) of approximately US$116 million and an Internal Rate of Return (IRR) of 19$151 million and a payback period of 4.5 years [7] - Stage 2, which focuses on desalinated water supply, has a post-tax NPV of US$958 million and an IRR of 19$1.4 billion and a payback period of 4 years [7] - Stage 3, conceptualized for a larger desalinated water supply, is projected to have a post-tax NPV of around US$1.3 billion and an IRR of approximately 19$1.9 billion and a payback period of 3.5 years [7] Strategic Positioning - Huasco Water has executed a Memorandum of Understanding (MOU) for a 20-year seawater supply to Hot Chili's Costa Fuego Copper-Gold Project, indicating strong initial demand [7][10] - The company has identified over 4,000 L/s of potential desalinated water demand from various undeveloped mining projects in the region, although no off-taker agreements have been secured for stages 2 and 3 yet [7][11][26] Regulatory and Environmental Considerations - Huasco Water has advanced in its permitting applications, having secured maritime water concessions and necessary permits for coastal land access and pipeline easements [7][16] - The project aligns with the Chilean government's approach to addressing water scarcity in the Atacama region, enhancing its strategic importance [25][88] Community and Market Engagement - There is significant interest in Huasco Water from both local and international water investment groups, as well as neighboring mine developers and community organizations [11][76] - The project aims to integrate industrial, community, and agricultural water demands, promoting regional water security and sustainability [25][87]