Ero logs high-grade hits at Brazil gold-copper project

Early-stage drilling at Ero Copper’s (TSX, NYSE: ERO) Furnas copper-gold project in northern Brazil’s Carajás region returned high-grade intercepts that extend known mineralization to a depth of 730 metres.

Hole FURN-DD-00284 cut 105 metres grading 1.17% copper and 0.77 gram gold per tonne from 332 metres downhole, Vancouver-based Ero said Thursday in a statement. Another standout intercept, in hole FURN-DD-00271, returned 75 metres at 1.02% copper and 0.59 gram gold from 501 metres depth, including 30 meters at 1.71% copper and 1.05 grams gold.

“[The results] highlight the potential for further resource growth at Furnas as Ero provides additional assay results and progresses through the Phase 2 exploration drill program,” National Bank Financial mining analyst Shane Nagle said in a note. “[The] advancement of Furnas is expected to eventually fill in the company’s declining production profile, which starts to occur in the second half of 2027 on declining grades from Tucumã,” another Brazilian mining asset that Ero operates.

Located in Pará state, Furnas sits about 190 km northeast of Tucumã and about 50 km southeast of Vale’s (NYSE: VALE) Salobo operation. It has access to extensive regional infrastructure, including paved roads, a power substation and a nearby Vale railroad loadout facility.

Vale deal

Furnas is covered by an earn-in agreement that Ero signed with the Brazilian multinational in July 2024. Under the deal, Ero can earn a 60% stake by completing several exploration, engineering and development milestones. Vale will keep an 11% free carry interest on future construction capital.

Ero shares rose 3.5% to $20.19 Thursday afternoon in Toronto, giving the company a market capitalization of about $2.1 billion. Over the past 12 months, the stock has traded between $13.17 and $31.56.

Ero recently completed the first stage of drilling at Furnas, which covers 28,000 metres, and has so far received results for about 10,000 metres. The project’s Southeast zone, where much of the drilling was focused, shows consistent mineralization beyond the existing indicated resource boundary, according to the company. All but one of the 66 holes in the first stage hit mineralization.

“These results reinforce the potential for Furnas to be a significant large-scale, high-grade underground mining operation,” CEO Makko DeFilippo said in the release.

Future PEA

Results from the first stage will underpin an updated resource estimate and a preliminary economic assessment that’s targeted for completion in the first half of next year, Ero said.

A second stage of drilling is now underway with eight drill rigs turning. At least 17,000 metres are planned, with a greater focus on step-out holes.

Furnas hosts 35.2 million indicated tonnes grading 1.04% copper and 0.69 gram gold for contained metal of 364,700 tonnes of copper and 775,300 oz. gold. The inferred resource is estimated at 61.3 million tonnes grading 1.06% copper and 0.63 gram gold, for contained metal of 647,400 tonnes of copper and 1.24 million oz. gold.