Ero Copper and Vale close agreement on Brazil’s Furnas project
The iron oxide-copper-gold project is located near Vale's Salobo operations and Ero’s Tucumã project.
Ero Copper (TSX: ERO, NYSE: ERO) has closed a deal with Salobo Metais, part of Vale’s (NYSE: Vale) base metals subsidiary, to advance the Furnas project in the Carajás mineral province of Brazil’s Pará state.
Furnas is an iron oxide-copper-gold project located about 50 km southeast of Vale Base Metals’ Salobo operations and 190 km northeast of Ero Copper’s Tucumã project, which is scheduled for production later this year.
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The agreement contemplates Ero Copper earning a 60% interest in the project upon completion of exploration, engineering and development milestones over a period of five years from the execution of a definitive earn-in agreement.
Ero will solely fund a phased exploration and engineering work program during the earn-in period and grant Vale Base Metals up to an 11% free carry on future project construction capital expenditures.
The Vancouver-based miner will also cover the exploration and engineering work leading to a definitive feasibility study at the end of the five-year earn-in period.
Covering an area of about 24 sq. km., the project sits within 15 km of extensive regional infrastructure, including paved roads, an industrial-scale cement plant, a power substation and Vale’s railroad loadout facility.
Shares of Ero Copper fell 1.15% by 11:55 a.m. EDT on Monday. The miner has a market capitalization of C$2.72 billion ($1.98 bn).