ERO.TO · 2019-12-19 12:00:00

Ero Copper announces updated high-grade mineral reserve with average production of 40,500 ounces over initial three-year mine life extension at the NX Gold Mine

Resource Estimates Production Results

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Ero Copper Corp

DECEMBER 19, 2019 NR:19-19

Ero Copper announces updated high-grade mineral reserve with average production of

40,500 ounces over initial three-year mine life extension at the NX Gold Mine

Vancouver, British Columbia – Ero Copper Corp. (“Ero” or the “Company”) (TSX: ERO) is

pleased to announce its 2019 updated National Instrument 43- 101 Standards of Disclosure for

Mineral Projects (“NI 43 -101”) compliant mineral reserve and resource estimate along with

updated life of mine (“LOM”) production, capital and operating cost projec tions for its 97.6%

owned NX Gold Mine, located in Mato Grosso State, Brazil. The update incorporates the results

of the first systematic drill exploration effort undertaken since the mine commenced operations in

2012, and includes the Santo Antonio Vein discovery. Highlights of the update include:

• 416% increase in Indicated mineral resources, inclusive of mineral reserves, to 442,600

tonnes containing approximately 174,700 ounces of gold (a 296% increase in contained

gold) compared to the Indicated mineral resources set out in the 2018 Technical Report (as

defined below);

• 476% increase in Probable mineral reserves to 378,900 tonnes containing approximately

138,200 ounces of gold (a 448% increase in contained gold) compa red to the Probable

mineral reserves set out in the 2018 Technical Report;

• Over 1,000% increase in I nferred mineral resources to 470,200 tonnes containing

approximately 141,700 ounces of gold (a 458% increase in contained gold) compared to

the Inferred mineral resources set out in the 2018 Technical Report; and,

• Underpinning the significant increase in mineral reserves and resources, an updated LOM

plan shows average annual production of approximately 40,500 ounces of gold at an

average annual head grade of 11.63 grams per tonne gold resulting in average C1 cash costs

of approximately US$479 per ounce of gold produced over the next three years.

Commenting on the update, David Strang, President & CEO stated, “Our strategy for the NX Gold

Mine at the outset of 2019 was to secure an initial mine life extension of three to five years at low-

cost production for the Company. We are pleased with the result of this effort as we now see a

strong foundation of gold production on which to build longer-term growth. The fact that this was

achieved over only eight months of drilling in what amounts to the first real exploration effort

undertaken at the property since 2012, speaks to the opportunity we see at NX Gold to continue to

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organically grow the mineral reserves and resources, extend mine life and ultimately significantly

increase production volumes from the mine.

Over the next year, we will continue to expand upon the success of the Santo Antonio Vein

discovery adding incremental mine life through resource conversion of our significant inferred

mineral resource base, drill testing new extensions of the Santo Antonio, Bras and Matinha veins

as well as undertaking the first regional exploration program ever conducted on the extensive land

package controlled by NX Gold.”

The NX Gold mineral reserve and resource estimate is shown in the following table:

Classification Tonnage

(000 tonnes)

Grade

(gpt Au)

Au Contained

(000 ounces)

Probable Mineral Reserve

Santo Antonio Vein 373.2 11.45 137.4

Brás Vein 3.0 3.83 0.4

Buracão Vein 2.7 5.42 0.5

Total Probable Reserve 378.9 11.35 138.2

Indicated Mineral Resource (inclusive of Reserves)

Santo Antonio Vein 403.7 12.53 162.6

Brás Vein 33.2 7.29 7.8

Buracão Vein 5.78 23.08 4.3

Total Indicated Resource 442.6 12.28 174.7

Inferred Mineral Resource

Santo Antonio Vein 164.2 11.31 59.7

Matinha Vein 149.0 12.15 58.2

Brás Vein 149.3 4.81 23.1

Buracão Vein 7.7 2.77 0.7

Total Inferred Resource 470.2 9.37 141.7

Mineral Reserve & Resource Notes:

1. Mineral Resource effective date of August 31, 2019.

2. Mineral Reserve effective date of September 30, 2019.

3. Presented mineral resources inclusive of m ineral reserves. All figures have been rounded to the relative

accuracy of the estimates. Summed amounts may not add due to rounding.

4. Mineral resource gold cut-off grade of 1.90 grams per tonne (“ gpt”) gold. Mineral resources have been

estimated using ordinary kriging inside 2.5m x 2.5m x 0.5m block sizes and minimum stope dimensions of

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Ero Copper Corp

1.25m x 1.25m x 1.50m. The mineral resource estimates were prepared in accordance with the Canadian

Institute of Mining , Metallurgy and Petroleum (“CIM”) Definition Standards for Mineral Resources and

Mineral Reserves, adopted by the CIM Council on May 10, 2014 (the “CIM Standards”) , and the CI M

Estimation of Mineral Resources and Mineral Reserves Best Practice Guidelines, adopted by CIM Council

on November 23, 2003 (the ‘CIM Guidelines”), using geostatistical and/or classical methods, plus economic

and mining parameters appropriate to the deposit.

5. Mineral reserve estimates were prepared in accordance with the CIM Standards and the CIM Guidelines,

using geostatistical and/or classical methods, plus economic and mining parameters appropriate for the

deposit. Mineral reserves are based on a long-term gold price of US$1,350 per ounce (“oz”), and a USD:BRL

foreign exchange rate of 3.80. Mineral reserves are the economic portion of the Indicated mineral resources.

Mineral reserve estimates include operational dilution of 10% plus planned dilution of approximately 10%

within each stope . Assumes mining recovery of 90 % and pillar recovery of 60% . Practical mining shapes

(wireframes) were designed using geological wireframes / mineral resource block models as a guide.

Mineral resources which are not mineral reserves do not have demonstrated economic viability.

UPDATED LOM PRODUCTION PLAN

The Company’s updated LOM production plan, prepared in conjunction with the updated mineral

resource and mineral reserve estimate , provides a pathway for average annual production of

approximately 40,000 ounces of gold over the next three years.

2019* 2020e 2021e 2022e

Ore Mined & Processed

(000 tonnes) 21.2 138.9 106.0 112.8

Au Grade (gpt) 6.65 9.95 16.36 9.24

Recovery (%) 87.0% 91.0% 91.0% 91.0%

Gold Production (oz) 3,936 40,438 50,720 30,472

Silver Production (oz) 2,249 23,107 28,983 17,413

(*) 2019 production outlines the mineral reserve schedule for the three months from the effective date of September 30, 2019 to

December 31, 2019.

UPDATED LOM OPERATING & CAPITAL COSTS

The updated production plan has resulted in changes to the forecast operating and capital cost

estimates. The tables below show the operating and capital costs for the updated LOM production

schedule.

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Ero Copper Corp

2019[1] 2020e 2021e 2022e

C1 Cash Cost

($US per oz) $1,378 $475 $374 $657

C1 Cash Cost Notes:

1. 2019 cash costs presented for the three months of the mineral reserve schedule from the effective date of September 30,

2019 to December 31, 2019.

2. Assumes USD:BRL FX rate of 3.80.

3. Assumes gold price of US$1,400 per ounce and silver price of US$17.00 per ounce.

4. C1 cash costs per ounce of gold produced is a non-IFRS measure, as more particularly discussed under the “Technical

and Scientific Information” section of this press release.

2019[1] 2020e 2021e 2022e

Capital Expenditures

(BRL 000s) R$12.7 R$21.0 R$7.2 R$3.6

Capital Expenditure Notes:

1. 2019 capital expenditure presented for the three months of the mineral reserve schedule from the effective date of

September 30, 2019 to December 31, 2019.

2. Capital expenditures presented in Brazilian real (“BRL”)

3. Amounts shown do not include discretionary greenfield or brownfield exploration in years 2020 through 2022.

TECHNICAL AND SCIENTIFIC INFORMATION

Mineral Resources

Block model tonnage and grade estimates for the NX Gold Mine were classified according to the

CIM Standards and the CIM Guidelines by Sr. Porfirio Cabaleiro Rodriguez of GE21 Consultoria

Mineral Ltda. (“GE21”) who is an independent qualified person as such term is defined under NI

43-101.

Cut-off grades of 1.90 gpt gold were used for the mineral resource estimate based on gold price of

US$1,900 per ounce of gold, underground mining and processing costs of US$115.30 per tonne

of ore mined and processed. Mineral resources were estimated using ordinary kriging within 2.5

meter by 2.5 meter by 0.5 meter block sizes and were constrained using a minimum stope

dimension of 1.25 meters by 1.25 meters by 1.50 meters. Mineral resources are shown inclusive

of mineral reserves.

Mineral Resource effective date of August 31, 2019.

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Ero Copper Corp

Mineral Reserves

The mineral reserves fo r the NX Gold Mine are derived from the Indicated mineral resource as

defined within the resource block model following the application of economic and other

modifying factors further described below. Inferred mineral resources, where unavoidably mined

within a defined mining shape have been assigned zero grade. Dilution occurring from Indicated

resource blocks was assigned grade based upon the current mineral resource grade of the blocks

included in the dilution envelope. Mineral reserves were classified according to the CIM Standards

and the CIM Guidelines by Sr. Porfirio Cabaleiro Rodriguez of GE21, an independent qualified

person as such term is defined under NI 43-101.

Mineral reserve cost assumptions are based on actual operating cost data during the 8-month period

from January 1, 2019 to August 30, 2019. The USD:BRL rate of 3.80 was selected.

Mineral reserve cut-off grades and parameters applied to the mineral reserve estimate are

summarized below:

• 2.92 gpt applied to mining stopes incorporating mining and development , pro cessing,

general and administrative (“G&A”) and indirect costs;

• 1.50 gpt applied to gallery development incorporating development and processing costs;

and,

• 2.26 gpt applied to mining marginal material adjacent to planned mining stopes

incorporating mining, development and processing costs.

Mineral reserve cut -off cost parameters are expressed as per tonne of ore mined and processed

(run of mine “ROM”):

Mining Costs (US$/tonne ROM) $33.48

Processing Costs (US$/tonne ROM) $44.30

G&A Costs (US$/tonne ROM) $24.36

Indirect Costs (US$/tonne ROM) $13.16

Metallurgical Recovery (average) 91.0%

Gold Price (US$/oz) $1,350

Foreign Exchange Rate (USD:BRL) 3.80

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Ero Copper Corp

Other modifying factors considered in the determination of the mineral reserve estimate include:

• A cut-off grade of 2.92 gpt was applied in the determination of planned mining stopes

within the mineral resource blocks based on actual operating cost data and past operating

performance of the mine.

• The mining method employed for the Brás and Buracão Veins is overhand cut and fill, with

backfill requirements generated from waste development. The mining method employed

for the Santo Antônio vein is inclined room and pillar.

• Maximum stope spans between sill pillars of 17 meters by 17 meters for the Buracão Vein,

39 meters by 10 meters for the Brás V ein, 40m by 18m for the east portion of the Santo

Antonio Vein and 40 meters by 15 meters for the west portion of the Santo Antonio Vein

based on geotechnical mapping, modeled rock quality and uniaxial compression (“UCS”)

test results.

• Within designed stopes, all contained material was assumed to be mined with no

selectivity. Inferred mineral resources, where unavoidably included within a defined

mining shape have been included in the mineral reserves estimate at zero grade. Mining

dilution resulting from Indicated blocks was assigned the grade of those blocks captured in

the dilution envelope using the current mineral resource estimate.

• Operational dilution of 1 0%, mining recovery of 90% within planned stopes, 60% pillar

recovery

Non-IFRS Measures

The Company utilizes certain non-IFRS measures, including C1 cash cost of gold produced, which

are not measures recognized under IFRS. The Com pany believes that these measures, together

with measures determined in accordance with IFRS, provide investors with an improved ability to

evaluate the underlying performance of the Company. Non- IFRS measures do not have any

standardized meaning prescribed under IFRS, and therefore they may not be comparable to similar

measures employed by other companies. The data is intended to provide additional information

and should not be considered in isolation or as a substitute for measures of performance prepared

in accordance with IFRS.

C1 cash cost of gold produced (per ounce) is the sum of production costs, net of capital expenditure

development costs and silver by-product credits, divided by the gold ounces produced. By-product

credits are calculated based on actual precious metal sales during the period divided by the total ounces

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Ero Copper Corp

of gold produced during the period. C1 cash cost of gold produced per pound is a non-IFRS measure

used by the Company to manage and evaluate operating performance of the Company’s operating

mining unit and is widely reported in the mining industry as benchmarks for performance but does not

have a standardized meaning and is disclosed in addition to IFRS measures.

QUALITY ASSURANCE / QUALITY CONTROL

Database QA/QC Validation

In order to validate the current mi neral resource estimate, GE21 selected a series of quality

assurance, quality control (“ QA/QC”) samples, including blanks, duplicate and standard control

samples from those performed by NX Gold. The set of samples was taken from the current mineral

resource estimate zone as well as adjacent areas. In the opinion of GE21, blank, standard and

duplicate sample analysis w as found to be within the acceptance limits for the classification of

mineral resources. No sample or database biases were detected. This work was supplemented by

drill hole database validation performed using the Geovia Surpac software database tool which

looks to validate final depth, overlapping results and drill hole collar information. No

inconsistencies or errors were found in the drill database review.

QA/QC Program

Drill core is logged, photographed and split in half using a diamond core saw at NX Gold’s secure

core logging and storage facilities. Half of the drill core is retained on site and the other half-core

is used for ana lysis, with samples collected on a minimum of 0.2 meters and a maximum of 2.0

meters with an average length of 0.5 meters. Sampling commences at least 1.0 meter before the

start of the mineralized zone and continues at least 1.0 meters beyond the limit of the mineralized

zone. All sample preparation is performed in NX Gold’s secure on-site laboratory. Gold content

is determined using fire assay. All sample results used in the preparation of the 2019 updated

mineral resource and reserve estimate have been monitored through a QA/QC program that

includes the insertion of certified standards, blanks, and pulp and reject duplicate samples at a rate

of one standard, one blank, and one duplicate pulp sample per every 20 samples for a blended rate

of approximately 5%.

Qualified Persons and the NI 43-101 Technical Report

Sr. Porfirio Cabaleiro Rodriguez, MAIG, has reviewed and approved the scientific and technical

information contained in this press release. Mr. Rodriguez is independent of the Company and is

a Qualified Person as defined by NI 43-101.

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Ero Copper Corp

The Company will file the associated NI 43 -101 compliant report on SEDAR ( www.sedar.com)

and on the Company’s website (www.erocopper.com) within 45 days of this press release, which

will serve as an update to the technical report entitled “Mineral Resource and Mineral Reserve

Estimate of the NX Gold Mine, Nova Xavantina” prepared by Porfírio Cabaleiro Rodriguez,

MAIG, Leonardo Apparicio da Silva, MAIG and Leonardo de Moraes Soares, MAIG all of GE21,

who are independent qualified persons under NI 43-101 (the “2018 Technical Report”)

ABOUT ERO COPPER CORP

Ero Copper Corp, headquartered in Vancouver, B.C., is focused on copper production growth from

the Vale do Curaçá Property, located in Bahia, Brazil. The Company’s primary asset is a 99.6%

interest in the Brazilian copper mining company, Mineraҫão Caraíba S.A. (“MCSA”), 100% owner

of the Vale do Curaçá Property with over 40 years of operating history in the region. The Company

currently mines copper ore from the Pilar and Vermelhos underground mines. In addition to the

Vale do Curaçá Property, MCSA owns 100% of the Boa Esperanҫa development project, an

IOCG-type copper project located in Pará, Brazil and the Company, directly and indirectly, owns

97.6% of the NX Gold Mine, an operating gold and silver mine located in Mato Grosso,

Brazil. Additional information on the Company and its operations, including technical reports on

the Vale do Curaçá , Boa Esperanҫa and NX Gold properties, can be found on the Company’s

website (www.erocopper.com) and on SEDAR (www.sedar.com).

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