Mr. Christian Easterday reports

HOT CHILI COMMENCES 30,000M DRILL PROGRAMME AT COSTA FUEGO COPPER-GOLD PROJECT

Hot Chili Ltd. has recommenced drilling across the western extension of the Cortadera porphyry resource, part of the company's Costa Fuego copper-gold project located 600 kilometres north of Santiago, at low elevation (less than 1,000 metres) in the coastal range of the Atacama region, Chile.

Drilling operations have been under way for five days, with one reverse circulation (RC) rig in operation and further diamond drill rigs to be added as the company ramps up its fully financed 30,000 m expansion drilling program across Costa Fuego.

Initial drill testing is focused on satisfying the company's remaining 3,000 m drill commitment with Antofagasta Minerals (see announcement dated Nov. 28, 2022) to acquire key leases lying along the western extension of Cortadera.

Drilling is also planned to test several porphyry targets at Cortadera and within the company's consolidated landholdings, in addition to remaining required development study drilling.

Given the company's significant advance on its prefeasibility study for Costa Fuego (over 80 per cent complete) and high indicated categorization of the current mineral resource (82 per cent indicated), the majority of planned drilling is being directed toward exploration and mineral resource growth.

Cortadera is the centrepiece of Costa Fuego, with the indicated mineral resource for Costa Fuego currently standing at 725 Mt (million tonnes) grading 0.47 per cent CuEq for 2.8 Mt copper (Cu) and 2.6 Moz gold (Au) and the inferred mineral resources comprising 202 Mt grading 0.36 per cent CuEq (copper equivalent) for 600,000 tonnes Cu and 400,000 ounces (oz) gold (Au).

Costa Fuego is one of the world's lowest capital intensity major copper developments (see announcement dated June 28, 2023, entitled "Hot Chili Announces PEA2 for Costa Fuego"), and is one of only a handful of projects outside of the control of major miners that is capable of delivering meaningful new copper supply this decade.

The company's recently announced preliminary economic assessment (PEA) establishes Costa Fuego as a low-risk, long-life copper project benefiting from a low start-up capital and a high annual copper equivalent metal production profile of over 100,000 tonnes for a 16-year mine life, including 95,000 tones Cu and 49,000 oz Au during primary production (first 14 years) at C1 cash cost of $1.33 (U.S.)/pound (lb) (estimated net of by-product credits).

Hot Chili is focused on up-scaling Costa Fuego's resource base and potential study scale toward a 150,000 tpa (tonne-per-annum) copper production profile ahead of the delivery of the Costa Fuego prefeasibility study (PFS), expected in H2 2024.

A mineral resource update for Costa Fuego is planned to be completed in H2 2023 and will include drilling from the current 30,000 m program, as well as significant drilling undertaken across Costa Fuego since the beginning of 2022.

The company is well financed, with approximately $26-million (Australian) in treasury following closing of its recent investment agreement with Osisko Gold Royalties for $15-million (U.S.) (as announced July 26, 2023).

A PEA technical report prepared in accordance with National Instrument 43-101 (as defined below) will be filed on SEDAR+ by Aug. 11, 2023.

The company looks forward to providing further updates on results from drilling activities and continuing development study work streams.

Qualifying statements

Technical report

For readers to fully understand the information in this news release, they should read the PEA technical report prepared in accordance with National Instrument 43-101 -- Standards of Disclosure for Mineral Projects (expected to be available on SEDAR+ and at the company's website by Aug. 11, 2023) in its entirety, including all qualifications, assumptions, limitations and exclusions that relate to the information set out in this news release that qualifies the technical information contained in the PEA. The PEA is intended to be read as a whole, and sections should not be read or relied upon out of context. The technical information in this news release is subject to the assumptions and qualifications contained in the PEA.

Qualified persons -- NI 43-101

The PEA was compiled by Wood Australia Pty. Ltd. with contributions from a team of independent qualified persons within the meaning of NI 43-101. The scientific and technical information contained in this news release pertaining to Coast Fuego has been reviewed and verified by the following independent qualified persons, within the meaning of NI 43-101:

• Elizabeth Haren (MAUSIMM (CP) and MAIG) of Haren Consulting -- mineral resource estimate;
• Dean David (FAUSIMM (CP)) of Wood Pty. -- metallurgy;
• Piers Wendlandt (PE) of Wood Pty. -- market studies and contracts, and economic analysis;
• Farzard Kossari (PE) of Wood Pty. -- cost estimation;
• Anton von Wielligh (FAUSIMM) of ABGM Consulting Pty. Ltd. -- mine planning and scheduling.

The independent qualified persons have verified the information disclosed herein, including the sampling, preparation, security and analytical procedures underlying such information.

Disclosure regarding mine planning and infrastructure has been reviewed and approved by Grant King, FAUSIMM, Hot Chili's chief operations officer, and a qualified person within the meaning of NI 43-101.

The technical information in this new release has been reviewed and approved by Christian Easterday, MAIG, Hot Chili's managing director and chief executive officer, and a qualified person within the meaning of NI 43-101.

Competent persons -- Joint Ore Reserve Committee (JORC)

The information in this news release that relates to mineral resources for the Costa Fuego project is based on information compiled by:

• Ms. Haren (MAUSIMM (CP) and MAIG) of Haren Consulting -- mineral resource estimate;
• Mr. David (FAUSIMM (CP)) of Wood Pty. -- metallurgy;
• Mr. Wendlandt (PE) of Wood Pty. -- market studies and contracts, and economic analysis;
• Mr. Kossari (PE) of Wood Pty. -- cost estimation;
• Mr. von Wielligh FAUSIMM) of ABGM Consulting -- mine planning and scheduling.

Ms. Haren, Mr. David, Mr. Wendlandt, Mr. Kossari and Mr. von Wielligh have sufficient experience, which is relevant to the style of mineralization and types of deposits under consideration and to the activities undertaken, to qualify as a competent person as defined in the 2012 edition of the Australasian Code of Reporting of Exploration Results, Mineral Resources and Ore Reserves, and as qualified persons under NI 43-101.

We seek Safe Harbor.