Ero Copper Furnas: A World-Class Copper-Gold Project in Carajás

The IOCG Deposit Model That Keeps Delivering: Why Carajás Remains the World's Most Compelling Copper Address

When geologists describe a deposit as "open in all directions," it is either a sign of early-stage optimism or genuine geological significance. In the case of the Ero Copper Furnas projeto de cobre ouro, the evidence increasingly points to the latter. The Carajás Mineral Province in the Brazilian state of Pará is not merely a regional mining district; it is one of the highest-grade, highest-continuity iron oxide copper gold (IOCG) corridors on the planet, home to Vale's world-class Salobo operation and a growing cluster of advanced-stage copper-gold projects that are drawing serious institutional attention.

Understanding why Furnas matters requires understanding the IOCG deposit class itself, a category of mineralisation that is far less discussed in mainstream mining commentary than porphyry copper systems, yet arguably more complex and, in certain geological settings, substantially more valuable per tonne milled.

What Makes the IOCG Deposit Type Strategically Distinctive

IOCG deposits are characterised by a distinctive mineral assemblage in which copper sulphides and gold are intimately associated with magnetite and hematite rather than the silica-dominated gangue typical of porphyry systems. This association is not merely academic; it has direct economic consequences.

Because magnetite is recoverable as a separate saleable product through magnetic separation of flotation tailings, an IOCG operation can generate three or more concurrent revenue streams: copper concentrate, gold in concentrate or doré, silver credits, and potentially a magnetite (iron) concentrate sold into steelmaking markets. This multi-commodity optionality is a structural advantage that pure copper projects cannot replicate.

The Carajás Province is the world's premier expression of the IOCG deposit class. The geological conditions that created Salobo, one of the largest known IOCG operations globally, are regionally continuous, and Furnas sits approximately 50 kilometres to the southeast within the same Archaean-Proterozoic tectonic framework. The spatial proximity to Salobo is not coincidental; it reflects a shared mineralising system driven by deep crustal fluid circulation and long-lived structural corridors that focused copper and gold precipitation over hundreds of millions of years.

IOCG systems in Carajás are distinguished by their scale and grade persistence at depth, two characteristics that separate them from many other copper deposit types where grade typically deteriorates with increasing depth.

The Furnas Project: Structure, Ownership, and the Earn-In Mechanism

The Ero Copper Furnas projeto de cobre ouro is structured as a joint venture earn-in arrangement with Vale Base Metals, the base metals subsidiary of Brazilian mining giant Vale. Under the terms of the agreement, Ero Copper will acquire a 60% project interest upon completing prescribed drilling programs and engineering work programs.

What is particularly notable from a project execution standpoint is the pace at which Ero has advanced through these contractual obligations. The company is tracking to complete all three contractual drilling programs approximately two years ahead of the milestone schedule, a material outperformance that signals both operational capability and genuine confidence in the deposit's exploration economics.

The earn-in structure with Vale Base Metals carries strategic implications beyond the mechanics of ownership transfer:

• Vale Base Metals brings deep institutional knowledge of the Carajás geological setting, including historical environmental baseline data that has meaningfully accelerated Furnas's licensing process
• The partnership provides Ero Copper with credibility and infrastructure access in a region where permitting relationships and local knowledge can be as valuable as the geological data itself
• Joint risk reduction between a major and a mid-tier developer reduces the financing risk for what is a large-scale capital project

Declared Mineral Resources: Scale and Grade in Context

As at the 2024 resource estimate, the Furnas project hosts a total mineral resource of 96.5 million tonnes at approximately 1.05% copper and 0.65 grams per tonne gold, comprising:

To contextualise these grades: the global average head grade for new copper mines commissioned in the past decade has trended below 0.5% copper. A resource averaging above 1% copper is considered high-grade by contemporary industry standards. Furthermore, when combined with meaningful gold credits at 0.65 g/t, the equivalent copper grade rises materially, improving the project's cost positioning on the global cost curve before a single tonne has been processed.

Critically, the deposit remains open in both depth and along strike, meaning the 96.5 Mt declared to date should be interpreted as a floor rather than a ceiling for the resource inventory. Every drilling program to date has encountered mineralisation at the limits of the tested envelope, which is the geological signature of a system that has not yet been fully defined. Understanding mine grade and permitting fundamentals helps contextualise why this open-ended geology is so commercially significant.

Drilling Results: What the Latest 24,000 Metres Reveal

As of the end of May 2026, Ero Copper has completed more than 75,000 metres of drilling at Furnas, with assay results available for approximately 52,000 metres. Ten drill rigs are currently operating simultaneously at the project, an unusually high rig count that reflects both the scale of the program and the urgency with which the company is advancing toward a Pre-Feasibility Study.

The most recent batch of results covers approximately 24,000 metres of drilling conducted after the Phase 1 program, split between roughly 6,000 metres of infill drilling focused on resource category conversion and 18,000 metres of extensional drilling targeting depth and along-strike continuity.

SE Zone: High-Grade Extensions Beyond Known Boundaries

The SE Zone continues to deliver some of the most compelling intercepts in the entire Furnas program:

Hole FURN-DD-0035 pushed the known mineralisation boundary approximately 115 metres down-dip, while FURN-DD-00354 intersected high-grade material roughly 80 metres beyond the current inferred resource boundary. Both results indicate that the SE Zone's high-grade core is migrating outward in directions that will require additional extensional drilling to fully delineate.

NW Zone: Continuity and Resource Conversion Confidence

The shallow intercept within FURN-DD-00348, returning 3.05% copper equivalent over 15 metres including 11.81 g/t silver, is a particularly striking result. Elevated silver grades in IOCG systems often correlate with proximity to high-temperature hydrothermal fluid pathways, suggesting that portions of the NW Zone boundary host structurally controlled, high-grade shoots that may be amenable to selective mining sequences.

Central Zone: The Most Underappreciated Discovery in the Program

The Central Zone discovery is arguably the most strategically significant result in this update, even though its individual intercept dimensions are smaller than the SE and NW zones. The importance lies in its geometry: this zone sits approximately 220 metres below the inferred resource envelope and more than 1.1 kilometres to the west of the SE high-grade corridor, in a portion of the deposit that is spatially adjacent to the planned underground infrastructure outlined in the Preliminary Economic Assessment (PEA).

If the Central Zone proves continuous at depth and along strike, it could serve as a third mining front within the planned underground infrastructure footprint, potentially improving the economics of underground development by increasing tonnes accessible from the same fixed capital investment.

This is the type of discovery that does not make headlines in the same way as a high-grade drill hole does, but which can fundamentally reshape a mine plan by reducing the marginal cost of production for each additional tonne.

Preliminary Economic Assessment: Project Scale and Returns

The PEA published in February 2026 outlined a project of substantial scale. Key parameters are summarised below:

Important disclaimer: PEA-level studies are preliminary in nature and include inferred mineral resources, which are considered too speculative geologically to have economic considerations applied to them. These figures should not be relied upon as definitive economic projections. Actual outcomes may differ materially.

The proposed operational structure combines open-pit mining with two underground operations, a configuration that allows the project to exploit near-surface oxide and transitional mineralisation through lower-cost open pit methods while accessing the deeper, higher-grade cores of the SE and NW zones via underground decline infrastructure.

Two value-addition opportunities identified in the PEA deserve particular attention:

1. Magnetite concentrate production via tailings magnetic separation: Rather than treating all non-copper material as waste, Furnas's IOCG mineralogy allows for magnetic separation of flotation tailings to produce a saleable iron product. This simultaneously generates revenue from what would otherwise be discarded material and reduces the physical volume of tailings requiring storage, a dual environmental and economic benefit.

2. Gravity circuit for gold recovery improvement: Standard flotation circuits can lose fine native gold particles that do not attach efficiently to air bubbles. A dedicated gravity circuit captures this gold fraction, improving overall gold recovery and increasing revenue per tonne processed.

Metallurgical Validation: What Post-PEA Test Work Confirms

Metallurgical test work conducted since the PEA's publication has systematically de-risked the processing assumptions underlying the economic study. The completed program includes:

• 7 additional variability tests examining how mineralisation from different parts of the deposit responds to the proposed flowsheet
• 24 additional closed-cycle flotation tests confirming recoveries across a range of feed grades and mineralogical compositions
• 1 continuous mini pilot plant test validating the process under dynamic, continuous-feed conditions

All results to date continue to corroborate the copper, gold, and silver recoveries and concentrate quality parameters assumed in the PEA flowsheet. Pilot plant scale variability testing is scheduled for the second half of 2026 in direct support of the forthcoming PFS. In addition, the copper leaching process advances being made industry-wide are providing further confidence in processing efficiency benchmarks for high-grade IOCG systems.

Importantly, additional testing has confirmed that magnetic separation of flotation tailings can produce a high-grade magnetite concentrate while simultaneously reducing tailings mass. In regions like Carajás, where tailings storage facility permitting is a known regulatory sensitivity, reducing tailings volume is not merely an economic benefit but a meaningful de-risking of the environmental approval pathway.

Brazil's Three-Phase Environmental Licensing Process Explained

One of the most commonly misunderstood aspects of Brazilian mining project development among international investors is the structure of the environmental licensing system. Brazil operates a sequential three-phase framework administered at the state level, running in parallel with federal mineral rights concession processes overseen by the Agência Nacional de Mineração (ANM):

Running mining rights concession processes at the federal level simultaneously with state-level environmental licensing creates a multi-track regulatory obligation that requires careful sequencing and stakeholder management. Companies with strong institutional partners familiar with this framework, as Ero Copper has through its association with Vale Base Metals, are better positioned to manage these parallel processes efficiently.

For Furnas, the following environmental approvals have already been obtained:

• Vegetation removal authorisation
• Wildlife and fauna management approval
• Water use licence for exploration activities
• Additional water extraction authorisation

The Environmental Impact Assessment and Environmental Impact Report (EIA/RIMA) are in the final stages of preparation, with a Preliminary Licence application expected to be submitted by year-end 2026. According to Furnas project reporting, the project has the potential to become a major underground copper and gold mine, further underlining the significance of securing these environmental milestones efficiently.

Consolidated Project Milestone Timeline: 2024 to 2027

The two-year ahead-of-schedule completion of contractual drilling programs is not merely a procedural achievement. In the context of earn-in agreements, early completion of work obligations reduces the period during which the acquiring party carries exploration risk without having secured its full ownership interest. It also compresses the timeline to the PFS publication, which is typically the inflection point at which institutional capital begins to engage more seriously with a project.

Furnas Within Ero Copper's Long-Term Growth Strategy

Ero Copper's existing operational base in Brazil includes the MCSA Mining Complex in the Curaçá Valley, Bahia, one of the highest-grade copper mines in the Americas, and the Tucumã copper project in Pará. Furnas represents the third pillar of a long-term organic growth pipeline that is anchored entirely within Brazil.

The company's leadership has been explicit that Furnas's consistent drill results reinforce the deposit's scale, quality, and growth potential, and that the Central Zone's proximity to the planned underground infrastructure unlocks new opportunities to expand a mining plan that was already compelling at PEA stage. The company's focus on advancing Furnas across licensing, engineering, and metallurgical work streams simultaneously reflects a deliberate acceleration strategy rather than sequential de-risking. Consequently, Ero Copper's capex outlook has been revised downward as project advances in Pará continue to materialise ahead of schedule.

Furnas vs. Regional IOCG Projects: A Comparative Perspective

Salobo's operational track record provides a long-duration proof of concept for large-scale IOCG mining in Carajás. Its decades of production data validate the metallurgical predictability of the deposit type and the durability of copper-gold grades at depth, lending indirect but meaningful geological credibility to Furnas's resource profile and economic projections.

The Structural Copper Demand Backdrop

The Ero Copper Furnas projeto de cobre ouro does not exist in isolation from global commodity dynamics. The copper supply crunch already emerging across global markets underscores why long-dated, high-grade copper projects are attracting significant institutional attention heading into the late 2020s and beyond.

Copper demand projections tied to electrification infrastructure, including grid expansion, electric vehicle manufacturing, and renewable energy installation, point to a structural supply gap emerging through the late 2020s and into the 2030s. Long-dated copper projects with high grades, multiple revenue streams, and credible development timelines are rare, and the market for them, whether as acquisition targets or as standalone development stories, reflects this scarcity. Furthermore, the key drivers boosting copper investment confidence continue to strengthen the investment case for projects at the quality end of the development spectrum.

Furnas's combination of a 96.5 Mt resource at 1.05% copper, a 27% post-tax IRR at PEA stage, a credible major-company partner in Vale Base Metals, and a deposit that continues to expand with every drill program positions it as one of the more compelling copper development assets in South America at this stage of the global energy transition.

This article is intended for informational purposes only and does not constitute financial or investment advice. Mineral resource estimates and economic projections referenced herein are based on publicly disclosed company announcements and PEA-level studies. PEA figures are preliminary, include inferred resources, and should not be interpreted as definitive economic assessments. Readers should conduct their own due diligence before making investment decisions.

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