Vancouver-based Ero Copper has entered a binding term sheet with Salobo Metais, part of the Vale Base Metals business (VBM), to advance its Furnas copper project, in Brazil.
The term sheet contemplates Ero earning a 60% interest in the project, located in the Carajás mineral province in Pará, upon completing exploration, engineering and development milestones over a five-year period.
In exchange for its 60% interest, Ero will sole fund a phased exploration and engineering work programme during the earn-in period and grant VBM up to an 11% free carry on future project construction capital expenditures.
"As construction of our Tucumã project approaches completion in the coming year, we look forward to Furnas further contributing to the growth of copper production within the broader Carajás region and solidifying Brazil's position as a leader in low carbon-intensity production of critical minerals,” commented Ero CEO David Strang.
Furnas is an IOCG project located about 50 km southeast of VBM's Salobo operations and about 190 km northeast of Ero's Tucumã project.
Covering an area of about 2 400 ha, 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.