Huasco Water Project - Overview
Huasco Water is a water supply business opportunity for the Huasco Valley. Huasco Water, through Hot Chili Limited, hold the only granted martime concession within the region to supply seawater into the valley.
The project is proposed across three stages of network deployment
Stage 1 Supply of untreated seawater to the proposed Costa Fuego Copper-Gold Project via a 64 km overland pipeline.
Stage 2 Establishment of a desalination plant and associated distribution network to potential industrial and mining clients in the Huasco Valley.
Stage 3 Expansion of the desalination plant and associated distribution network to additional potential industrial and mining clients in the Huasco Valley.
The Huasco Water PFS was released on 31st March 2025 | Huasco Water PFS Announcement
Highlights del proyecto
Strong Economics for a Large, Multi-User, Water Business
- Stage 1 Water Supply Preliminary Feasibility Study (PFS) for 500L/s of Potential Seawater Supply: Post-tax Net Present Value (NPV8%) of US$122 million and Internal Rate of Return (IRR) of 19%. Construction capital cost for seawater supply estimated at US$151 million with a 4.5-year payback
- Stage 2 Water Supply PFS for 1,300 L/s of Potential Desalinated Water Supply: Post-tax NPV8% of US$977 million and IRR of 19%. Construction capital cost for desalinated water supply estimated at US$1.4 billion with a 4-year payback. Stage 2 financial outcomes include Stage 1 capital and operating cashflows
- Stage 3 Conceptual Study for Expansion to 2,300 L/s of Potential Desalinated Water Supply
Stage 1- Multi-Decade Seawater Supply to Costa Fuego
- 20 Year Seawater Supply with Foundation Off-taker: Memorandum of Understanding (MOU) executed for water supply of up to 500 L/s to Hot Chili’s Costa Fuego Copper-Gold Project (Costa Fuego)
- Long Lead-times Permits Secured: Granted maritime water concession to extract seawater, permit for coastal land access, Stage 1 pipeline easements and connection to the electrical grid secured
- Near-Term Development Decision Tied to Costa Fuego: First water supply planned for end of decade
Stage 2 and 3 – Regional, Desalinated Water Supply Opportunity
- Large Catchment of Potential Off-takers: Over 4,000 L/s of desalinated water demand identified, including six undeveloped mining projects without secured access to desalinated water supply.
- Staged Growth Approach: Establishment of seawater supply infrastructure toward the end of the decade, followed by the commencement of initial desalinated water supply shortly thereafter, and subsequent staged expansion. The staged approach enables long term scalable water supply to support mining, community, and agriculture in the Huasco Valley region with potential to extend well beyond the initial project horizons.
First-Mover Advantage
- Only Active Maritime License: HW Aguas para El Huasco SpA (“Huasco Water”), a joint venture between Hot Chili (80% interest) and Compañia Minera Del Pacifico “”CMP” (20% interest), is the only company with permitted access to supply seawater in the Huasco Valley region following a ten-year regulatory approval process
- Desalination Permitting Advancing: Over a year advanced on regulatory applications to enable the supply of desalinated water from the existing maritime concession and a second maritime concession application by Huasco Water
- Long Permitting Timelines Continue: No regulatory changes have been made to Chile’s maritime permitting process since Huasco Water was granted its concession. Hot Chili maintains a competitive advantage as the first mover in the area for a water distribution business.
- Environmental Impact Assessment (EIA) Advanced: Stage 1 seawater supply is included within the Costa Fuego EIA, baseline studies complete.
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Why is Costa Fuego receiving seawater, and not desalinated water, in Stage 1?
The Costa Fuego project has been designed to utilise seawater for it's processing activities, such as across leaching and concentrate production.
Smaller scale reverse osmosis plants are planned by Costa Fuego for the conversion of a portion of this delivered seawater into desalinated water for use in areas where sea water would lead to corrosion - such as in the underground mine and within mining equipment.
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What is the difference between Hot Chili Limited and Huasco Water?
Huasco Water is a joint venture between Hot Chili (80% interest) and Compañia Minera Del Pacifico ”CMP” (20% interest). Hot Chili started the permitting process, and obtained the permits and martime concessions that will enable Huasco Water, prior to the joint venture being formed in 2024.
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