ERO.TO · 2020-11-30 12:00:00

Ero Copper significantly increases copper reserves with the integration of Deepening Extension Project into updated life-of-mine plan for the Vale do Curaçá Property

Economic Studies

TSX: ERO

1 Ero Copper Corp

NOVEMBER 30, 2020

Ero Copper significantly increases copper reserves with the integration of Deepening

Extension Project into updated life-of-mine plan for the Vale do Curaçá Property

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

announce the release of its 2020 updated National Instrument 43-101 Standards of Disclosure for

Mineral Projects (“NI 43 -101”) compliant m ineral reserve and resource e stimate along with

updated life of m ine (“LOM”) production, capital and operating cost projections on its 99.6%

owned Vale do Curaçá Property (herein referred to as the “Curaçá Valley”) located in Bahia State,

Brazil.

Within the Curaçá Valley LOM production plan, for the 2020 update, the Company has included

production, capital and operating cost projections based upon the mineral reserves derived from

the Measured and Indicated mineral resources from within the Deepening Extension Zone of the

Pilar Mine (the “Deepening Extension Project”). I n addition, the Company has included an

independent preliminary economic assessment based upon the Inferred mineral resources within

the Deepening Extension Zone of the Pilar Mine (the “Deepening Inferred Project”), that shows

the expected synergies associated with utilizing the infrastructure that will be built in support of

the Deepening Extension Project, to illustrate the potential of the Deepening Extension Zone.

Highlights of the 2020 update include:

• Significant increase in contained copper within the mineral reserves and resources of the Pilar

Mine with the inclusion of the Deepening Extension Zone. Proven and Probable m ineral

reserves, at the same long-term copper price assumption of US$2.75 per pound, increased by

43%, while M easured and Indic ated, and Inferred Resources increased by 28% and 155% ,

respectively. The mineralized extent of the Deepening Extension Zone has yet to be fully

defined and remains open to the north, east and to depth.

• Overall Curaçá Valley contained copper within the Proven and Probable mineral reserves,

Measured and Indicated, and Inferred mineral resources increased by 23%, 29% and 62%

respectively, inclusive of the Deepening Extension Zone.

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2 Ero Copper Corp

Summary, 2020 Update(1,2) Year-on-Year Change

Tonnes

(000s)

Grade

(Cu %)

Contained Cu

(kt)

Contained Cu

(kt) (%)

Deepening Extension Zone, Pilar Mine

Mineral Reserves

Proven - - - - n/a

Probable 7,432 1.68 125 101 421%

Proven & Probable 7,432 1.68 125 101 421%

Mineral Resources

Measured - - - - n/a

Indicated 7,527 1.86 140 110 373%

Measured & Indicated 7,527 1.86 140 110 373%

Inferred 4,476 2.12 95 70 284%

Pilar Mine (including Deepening Extension Zone)

Mineral Reserves

Proven 5,835 1.41 82 (15) (16%)

Probable 15,157 1.38 209 103 98%

Proven & Probable 20,992 1.39 291 88 43%

Mineral Resources

Measured 26,829 1.50 401 52 15%

Indicated 21,518 1.37 295 101 52%

Measured & Indicated 48,347 1.44 696 153 28%

Inferred 17,266 1.20 206 126 155%

Curaçá Valley, Total (including Pilar Mine)

Mineral Reserves

Proven 21,464 1.06 228 (26) (10%)

Probable 28,990 1.06 308 126 69%

Proven & Probable 50,454 1.06 536 100 23%

Mineral Resources

Measured 49,158 1.27 624 69 12%

Indicated 53,627 0.99 531 192 56%

Measured & Indicated 102,786 1.12 1,155 260 29%

Inferred 39,201 1.00 391 149 62%

• LOM copper production targeting average C1 cash costs at or below US$1.00 per pound of

copper is shown in the ta ble below. The LOM production plan includes ongoing production

from the Vermelhos and Pilar mines (including the Deepening Extension Project), open pit

production utilizing ore sorting from t he N8/N9 and Siriema open pit operations within the

Vermelhos District and non-ore sorted production from the Surubim District open pit

operations of Surubim and C12:

2020(1)

2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033

LOM Plan Cu Production

(000s tonnes) 9.2 43.0 42.9 45.1 48.9 46.3 46.2 43.9 46.0 37.8 26.3 15.3 12.3 17.3

Deepening Inferred

Project Cu Production

(000s tonnes)

- - - 0.1 0.3 0.8 2.1 4.0 3.9 11.4 23.2 17.4 8.0 7.7

1 Q4 2020 production outlines the mineral reserve schedule for the three months from the effective date of October 1, 2020 to December 31, 2020.

Please refer to the detailed mineral reserve and mineral resource tables of this press release, as detailed in the “Mineral Reserves, 2020”,

“Underground Mineral Resources, 2020”, and “Open Pit Mineral Resources, 2020” sections of this press release, as well as the “Technical and

Scientific Information” below for additional information on the stated mineral reserves and mineral resources.

2 Presented mineral resources inclusive of mineral reserves. Mineral resources that are not mineral reserves do not have a demonstrated economic

viability. All figures have been rounded to the relative accuracy of the estimates. Summed amounts may not add due to rounding.

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3 Ero Copper Corp

The Deepening Inferred Project is preliminary in nature and based on the Inferred mineral

resources of the Deepening Extension Zone which are considered too speculative geologically

to have the economic considerations applied to them that would enable them to be categorized

as mineral reserves, and there is no certainty that the Deepening Inferred Project will be

realized. Mineral resources that are not mineral reserves do not have a demonstrated economic

viability. Please refer to the “Deepening Inferred Project” section of this press release for

additional technical and scientific information related to the Deepening Inferred Project

• Integration of ore sorting into the Company’s LOM plan for the Vermelhos District open pit

deposits of N8/N9 and Siriema contribute to improved mill head-grades and maintaining first-

quartile C1 cash costs over the LOM.

Ore Sorting Highlights

Vermelhos District, Mining (including fines)

Open Pit Production / Sort Feed (000s tonnes) 19,968

Copper Grade, Sort Feed (% Cu) 0.56%

Sorted Production, Sent to Mill (including fines)

Sort Product, Sent to Mill (000s tonnes) 8,891

Copper Grade, Mill Feed (% Cu) 1.18%

• With the inclusion of the Deepening Extension Project at the Pilar Mine, a significant increase

in production from the current 1.2 Mtpa ore mined to approximately 2.2 Mtpa ore mined is

planned. The expansion of the Pilar is supported by the installation of a new external shaft ,

scheduled to commence construction in Q3 2021, that will not only support the planned

increases in copper production at the Pilar Mine but has also been designed to support the

potential for longer term copper production increases from both the Deepening Inferred Project

and as additional mineralization is defined. In keeping with the Company’s return on invested

capital focus, the expansion of the mine and development of the infrastructure in support of

the Deepening Extension Project is being delivered at a low capital -intensity ratio of

approximately US$1,677 per tonne of incremental copper production delivered over the LOM.

LOM Plan & Pilar Deepening Highlights

LOM Plan including

Deepening Extension

Project, Pilar Mine

Deepening Inferred

Project, Pilar Mine

Average Mill Throughput / Production (Mtpa) 3.0 n/a

Peak Mill Throughput / Production (Mtpa) 4.2 n/a

Total Tonnes Processed (000s tonnes) 39,378 4,203

Average Copper Head Grade (% Cu) 1.33% 2.01%

Average Metallurgical Recoveries (%) 91.5% 93.2%

Total Copper Production (000s tonnes) 480.8 78.9

Average LOM C1 Cash Costs (US$ per lb. Cu)[1] US$0.97 US$0.25

Total LOM Capital Cost (USD million) US$553.9 -

Pilar Mine Deepening Capital Cost Only (USD million) US$190.3 US$27.8

Pilar Mine Deepening Capital Intensity (US$ per tonne of Cu) [2] US$1,677 US$353

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4 Ero Copper Corp

Additional LOM Plan & Pilar Deepening Highlight Notes:

1. C1 Cash Costs expressed in US Dollars (“USD”), converted at a USD to Brazilian Real (“BRL”) foreign exchange rate of

5.00, assumes gold and silver price of $1,750 and $18.00 per ounce, respectively. Fixed processing costs and operational

support for the Curaçá Valley are allocated to the Company’s LOM Plan.

2. Capital costs for capital intensity figures converted to USD at a USD:BRL foreign exchange rate of 5.00. Capital intensity

figures based on recovered copper assuming average LOM metallurgical recovery, as disclosed in this table.

The Deepening Inferred Project is preliminary in nature and based on the Inferred mineral

resources of the Deepening Extension Zone which are considered too speculative geologically

to have the economic considerations applied to them that would enable them to be categorized

as mineral reserves, and there is no certainty that the Deepening Inferred Project will be

realized. Mineral resources that are not mineral reserves do not have a demonstrated economic

viability. Please refer to the “Deepening Inferred Project” section of this press release for

additional technical and scientific information related to the Deepening Inferred Project.

Commenting on the update, David Strang, President and CEO stated, “Our 2020 updated mineral

reserve and resource estimate and LOM plan reflects a considerable effort across our organization

to deliver on several key initiatives that we commenced late last year. All of these initiatives were

delivered under our corporate philosophy of maintaining a high return on invested capital for our

shareholders and targeting LOM operating costs at or below US$1.00 per pound of copper.

First, and most significantly, this includes the delivery of the Deepening Extension Project at the

Pilar Mine from initial concept in late 2019, through 12 months of aggressive drilling and

extensive engineering and design work undertaken by our technical team s with the support of a

large, diversified group of external consultants. While the Deepening Extension Project ,

technically, remains a mere extension of our existing operations at Pilar, the inclusion of the new

shaft along with updated ventilation and cooling provides us with increased flexibility to not only

increase overall production from Pilar but also improve the operating environment for our

operations teams working in the mine, thereby increasing operating time at the working face.

Further, we believe the new shaft will support production from the deeper parts of the Pilar mine

well beyond the currently defined mineral reserves within the Deepening Extension Project in this

update. As we have stated, mineralization in the Deepening Extension Zone remains open to the

north, to depth and to the east best evidenced by the high -grade Inferred mineral resources

outlined in this update. These resources have been categorized as Inferred resources primarily as

a result of variability in drill hole spacing due to the acute angles and limited availability of drill

stations. During 2021, we will be developing exploration drives that we expect will enable holes

to be drilled at angles that will allow for upgrading of these Inferred resources to the Measured

and Indicated categories . These exploration drives will also assist in our ability to evaluate

potential extensions to the current known limits of mineralization of the Deepening Extension

Zone.

The second initiative reflected in our LOM update is the successful integration of ore-sorting into

our operations following the completion of a comprehensive trial campaign earlier this year. The

integration of ore-sorting within our operations will allow us to remove a significant amount of

waste material mined, deliver feed to the plant at significantly higher copper grades and thereby

lower transportation and processing costs while allowing our operations to use less water and

TSX: ERO

5 Ero Copper Corp

power, and generate significantly less tailings. The integration of ore-sorting, like the Deepening

Extension Project, is in-line with our corporate philosophy of maintaining high returns on invested

capital, low capital intensity and first quartile operating costs.

With our updated LOM plan now in place, we have a solid production platform on which we can

continue to grow. Relative to the mill’s original design capacity of 5.5 million tonnes per annum,

our updated LOM plan retains excess capacity of up to 1.3 million tonne s per annum, which

continues to provide flexibility to augment our near- to medium-term production profile with new

discoveries. In 2021, we will be focusing our exploration efforts on defining new mineral resources

and reserves within the Southern Vermelhos Corridor to extend the operational life at the

Vermelhos Mine beyond 2026. We will also be focusing on upgrading the Inferred resources within

the Deepening Extension Zone while continuing to define extensions of mineralization to the north,

to depth and to the east as well as refocus some of our exploration efforts at Pilar on the West

Limb to further define down plunge extensions. And of course, we will continue to advance our

regional exploration programs in a post-Covid environment that will allow our geological team

and consultants greater freedom to travel to site on a regular basis.”

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6 Ero Copper Corp

The 2020 updated mineral reserve and resource estimate for the underground and open pit deposits

and mines of the Curaçá Valley are shown in the tables below:

Mineral Reserves, 2020

Classification Tonnage Grade Cu Contained

(000 tonnes) (Cu %) (000 tonnes)

Reserves, Underground

Deepening Extension Zone, Pilar UG Mine

(Pilar Mine below Level -965)

Proven - - -

Probable 7,432 1.68 125

Pilar UG Mine Ex-Deepening Extension Zone

(Pilar Mine above Level -965)

Proven 5,835 1.41 82

Probable 7,725 1.09 84

Vermelhos UG Mine Proven 3,359 2.09 70

Probable 1,844 1.23 23

Surubim District, Underground Proven 513 1.09 6

(C12 Underground) Probable 515 0.83 4

Total Proven 9,707 1.63 158

Total Probable 17,516 1.34 236

Total Proven & Probable, Underground 27,224 1.45 394

Reserves, Open Pit

N8/N9 OP Mine

(Vermelhos District)

Proven 7,355 0.55 40

Probable 8,012 0.54 44

Siriema OP Mine

(Vermelhos District)

Proven - - -

Probable 3,011 0.88 26

Surubim District, Open Pit

(Surubim & C12)

Proven 2,778 0.82 23

Probable 123 0.55 1

Suçuarana South OP Mine

(Pilar District)

Proven 1,623 0.42 7

Probable 328 0.46 2

Total Proven 11,757 0.60 70

Total Probable 11,474 0.63 72

Total Proven & Probable, Open Pit 23,230 0.61 142

Mineral Reserve Notes:

1. Mineral reserve effective date of October 1, 2020. All figures have been rounded to the relative accuracy of the estimates. Summed

amounts may not add due to rounding.

2. Mineral reserve 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 CIM 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 for

the deposit. Mineral reserves are based on a long -term copper price of US$2.75 per pound (“lb”), and a USD:BRL foreign exchange

rate of 4.27, except for the C12 (Surubim District) and Suçuarana (Pilar District) open pit mines, whose design was not changed in 2020,

and continued to assume a 3.70 USD:BRL foreign exchange rate . Mineral reserves are the economic portion of the Measured and

Indicated mineral resources. Mining dilution and recovery factors vary for specific mineral reserve sources and are influenced by factors

such as deposit type, deposit shape, stope orientation and selected mining method. Inferred resource blocks, where unavoidably mined,

were assigned zero grade. Dilution occurring from Measured & Indicated resource blocks was assigned grade based upon the mineral

resource grade of the blocks included in the dilution envelope. Please see “Technical and Scientific Information” for additio nal

information on the stated mineral reserves.

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7 Ero Copper Corp

Underground Mineral Resources, 2020

Underground Mine / Deposit Classification Tonnage Grade Cu Contained

(000 tonnes) (Cu %) (000 tonnes)

Deepening Extension Zone, Pilar Mine

(Pilar Mine below Level -965)

Measured - - -

Indicated 7,527 1.86 140.0

Measured & Indicated 7,527 1.86 140.0

Inferred 4,476 2.12 94.8

Pilar Mine Ex-Deepening Extension Zone

(Pilar Mine above Level -965)

Measured 26,829 1.50 401.3

Indicated 13,991 1.11 154.8

Measured & Indicated 40,820 1.36 556.0

Inferred 12,790 0.87 111.6

Pilar District, Other Underground

(R75, Sucuarana)

Measured 816 0.72 5.9

Indicated 1,045 0.89 9.3

Measured & Indicated 1,861 0.82 15.2

Inferred 742 0.60 4.5

Pilar District Underground Total

Measured 27,645 1.47 407.2

Indicated 22,563 1.35 304.2

Measured & Indicated 50,208 1.42 711.3

Inferred 18,008 1.17 210.9

Vermelhos Mine

Measured 3,389 2.80 94.9

Indicated 4,514 1.19 53.7

Measured & Indicated 7,903 1.88 148.6

Inferred 4,128 0.86 35.5

Vermelhos District, Other Underground

(Siriema, N8/N9)

Measured 1,465 0.79 11.6

Indicated 4,153 0.80 33.4

Measured & Indicated 6,676 0.91 61.1

Inferred 7,689 0.88 67.9

Vermelhos District Underground Total

Measured 4,402 2.33 102.4

Indicated 8,667 1.00 87.1

Measured & Indicated 13,069 1.45 189.5

Inferred 13,781 0.93 127.6

Surubim District, Other Underground

(Surubim, C12, Cercado Velho, Lagoa da

Mina, Terra do Sal)

Measured 1,841 0.96 17.7

Indicated 3,062 0.96 29.3

Measured & Indicated 4,904 0.96 47.0

Inferred 4,482 0.92 41.3

Surubim District Underground Total

Measured 1,841 0.96 17.7

Indicated 3,062 0.96 29.3

Measured & Indicated 4,904 0.96 47.0

Inferred 4,482 0.92 41.3

Total, Underground

Measured 33,888 1.56 527.3

Indicated 34,292 1.23 420.6

Measured & Indicated 68,180 1.39 947.9

Inferred 36,271 1.05 379.8

Underground Mineral Resource Notes:

1. Mineral resource effective date varies by deposit, with an effective date of August 8, 2020 except for P1P2 (July 24, 2020), R75 (July

9, 2019) and Suçuarana (July 3, 2020) within the Pilar District; Vermelhos Mine (July 29 2020), Siriema and N8 (July 4, 2020), N9

(July 9, 2019) within the Vermelhos District; and Surubim District effective date of July 9, 2019 except for Terra do Sal (July 3, 2020).

2. Presented mineral resources inclusive of mineral reserves. All figures have been rounded to the relative accuracy of the estim ates.

Summed amounts may not add due to rounding.

3. Mineral resources have been constrained within newly developed 3D lithology models applying a 0.45% and 0.20% copper grade

envelope for high and marginal grade, respectively. Within these envelopes, mineral resou rces for underground deposits were

constrained using varying stope dimensions of up to 20m by 10m by 35m applying a 0.51% copper cut-off grade, as well as a 0.32%

copper marginal cut-off grade. Mineral resources have been estimated using ordinary kriging inside 5m by 5m by 5m block sizes. The

mineral resource estimates were prepared in accordance with the CIM Standards, and the CIM Guidelines, using geostatistical a nd/or

classical methods, plus economic and mining parameters appropriate to the deposit. Please see “Technical and Scientific Information”

below for additional information on the stated mineral resources.

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8 Ero Copper Corp

Open Pit Mineral Resources, 2020

Open Pit Mine / Deposit Classification Tonnage Grade Cu Contained

(000 tonnes) (Cu %) (000 tonnes)

Pilar District, Open Pit

(R22W, Suçuarana, R75)

Measured 3,172 0.49 15.4

Indicated 365 0.45 1.6

Measured & Indicated 3,537 0.48 17.0

Inferred 351 0.47 1.6

Pilar District Open Pit Total

Measured 3,172 0.49 15.4

Indicated 365 0.45 1.6

Measured & Indicated 3,537 0.48 17.0

Inferred 351 0.47 1.6

Siriema Deposit

Measured - - -

Indicated 2,956 0.92 27.1

Measured & Indicated 2,956 0.92 27.1

Inferred 187 0.99 1.9

N8/N9 Deposits

Measured 7,420 0.55 41.1

Indicated 13,562 0.48 64.9

Measured & Indicated 20,982 0.51 106.0

Inferred 858 0.40 3.4

Vermelhos North

Measured - - -

Indicated - - -

Measured & Indicated - - -

Inferred 121 0.88 1.1

Vermelhos District Open Pit Total

Measured 7,420 0.55 41.1

Indicated 16,518 0.56 92.0

Measured & Indicated 23,938 0.56 133.1

Inferred 1,166 0.55 6.4

Surubim Mine

Measured 2,340 0.93 21.7

Indicated 73 0.84 0.6

Measured & Indicated 2,413 0.92 22.3

Inferred 3 0.80 0.0

C12 Deposit

Measured 1,272 0.94 11.9

Indicated 942 0.70 6.6

Measured & Indicated 2,214 0.84 18.6

Inferred 154 0.56 0.9

Surubim District, Other Open Pit

(Cercado Velho, Lagoa da Mina,

Terra do Sal)

Measured 1,067 0.61 6.5

Indicated 1,436 0.67 9.6

Measured & Indicated 2,503 0.64 16.1

Inferred 1,255 0.15 1.9

Surubim District Open Pit Total

Measured 4,678 0.86 40.1

Indicated 2,452 0.69 16.8

Measured & Indicated 7,130 0.80 56.9

Inferred 1,413 0.20 2.8

Total, Open Pit

Measured 15,270 0.63 96.6

Indicated 19,335 0.57 110.5

Measured & Indicated 34,605 0.60 207.0

Inferred 2,930 0.37 10.8

Open Pit Mineral Resource Notes:

1. Mineral resource effective date varies by deposit, with an effective date of August 8, 2020, except for Suçuarana (July 3, 2020), R22W

and R75 (July 9, 2019) within the Pilar Dist rict; Siriema and N8 (July 4, 2020), N9 and Vermelhos North (July 9, 2019) within the

Vermelhos District; and an effective date of July 9, 2019 for the Surubim District except Terra do Sal (July 3, 2020). Presented mineral

resources inclusive of mineral reserves. All figures have been rounded to the relative accuracy of the estimates. Summed amounts may

not add due to rounding.

2. Mineral resources have been constrained within newly developed 3D lithology models using a 0.21% copper cut-off grade for open pit

deposits. Mineral resources have been estimated using ordinary kriging inside 5m by 5m by 5m block sizes. The mineral resource

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 to the deposit. Please see “Technical and Scientific Information” below for additional

information on the stated mineral resources.

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

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