VANCOUVER, British Columbia – Ero Copper Corp. has released its first-ever Preliminary Economic Assessment for the Furnas Copper-Gold Project, outlining a substantial mining operation with a 24-year initial mine life and compelling financial metrics. The project, situated in Brazil's Carajás Mineral Province, demonstrates strong economic potential through detailed analysis of resource estimates and production projections.
Project Overview and Partnership Structure
The Furnas project represents a significant development within Ero Copper's organic growth strategy, currently being advanced through a partnership arrangement with Vale Base Metals. Under the established earn-in agreement, Ero Copper will secure a 60 percent interest in the project upon completion of specified work programs, positioning the company as the majority stakeholder in this promising venture.
Key Economic and Production Highlights
The Preliminary Economic Assessment reveals several noteworthy metrics that underscore the project's viability:
- Extended Mine Life: A 24-year initial operational period based on updated mineral resource estimates that remain open both laterally and at depth
- Substantial Production Volume: Average annual copper equivalent production of approximately 108,000 tonnes during the first 15 years, including 70,000 tonnes of copper, 111,000 ounces of gold, and 532,000 ounces of silver annually
- Strong Financial Returns: After-tax net present value of $2.0 billion at an 8 percent discount rate, with an after-tax internal rate of return reaching 27.0 percent using long-term commodity price assumptions
- Cost Efficiency: Life-of-mine C1 cash costs estimated at approximately $0.30 per pound of copper produced, supported significantly by gold and silver by-product credits
- Capital Investment: Initial capital expenditures projected at $1.3 billion, representing low capital intensity of about $16,000 per copper equivalent tonne
Commodity Price Sensitivity Analysis
The economic assessment demonstrates considerable sensitivity to fluctuations in commodity markets. Using base case assumptions of $4.60 per pound for copper, $3,300 per ounce for gold, and $40.00 per ounce for silver, the project generates solid returns. However, at elevated price scenarios of $6.10 per pound for copper and $5,550 per ounce for gold, the after-tax net present value more than doubles to $4.7 billion, while the internal rate of return increases substantially to approximately 44.0 percent.
Cumulative Production and Value Enhancement Opportunities
Over the projected life of the mine, total production is expected to exceed 1.2 million tonnes of copper, accompanied by approximately 2.0 million ounces of gold and 9.0 million ounces of silver. The company is actively evaluating several opportunities to enhance project value, including ongoing exploration drilling programs, potential addition of a magnetite recovery circuit to produce high-grade magnetite concentrate as a by-product, and implementation of a gravity pre-concentration stage to improve gold recovery rates.
Executive Commentary and Strategic Vision
Makko DeFilippo, President and Chief Executive Officer of Ero Copper, emphasized the significance of the assessment results, stating, "The PEA outlines a large-scale, long-life copper-gold operation with strong underlying economics, supported by low capital intensity, first quartile operating costs and an attractive internal rate of return across a wide spectrum of commodity prices."
DeFilippo further noted that the announcement represents the culmination of multiple exploration drilling campaigns and extensive engineering studies developed over more than a decade. He highlighted the company's commitment to responsible mine development, with a significant portion of Furnas production expected to originate from underground operations, resulting in a reduced environmental footprint compared to alternative mining scenarios.
"We are thrilled to be working alongside such a strong partner in VBM to advance exploration, engineering and permitting workstreams to deliver value for all stakeholders of the Project," DeFilippo concluded, underscoring the collaborative approach to project development.
The Furnas project continues to demonstrate expansion potential, with mineralization remaining open for further exploration and development, suggesting opportunities for incremental value creation and extended operational life beyond the current 24-year projection.
