Ni 43 101 Report Boa

Feasibility Study
Technical Report for the

Boa Esperança Copper Project,
Pará State, Brazil
Report Prepared for

Ero Copper Corp.
Report Prepared by
SRK Consultores do Brasil LTDA.

SRK Project Number: 031.14
June 1, 2017
Feasibility Study - Technical Report - Boa Esperança Copper Project - Brazil Page i
Feasibility Study
Technical Report
Boa Esperança Copper Project; Pará State
Brazil
Ero Copper Corp.

Suite 1050, 625 Howe Street
Vancouver, British Columbia
V6C 2T6
E-mail: info@erocopper.com
Web site: http://www.erocopper.com
Tel.: +1 (604) 449-9236

Rua Santa Rita Durão, 74, 12° Andar, Funcionários
Belo Horizonte, Minas Gerais, Brazil
SRK Project Number 031.14
Effective Date: June 1, 2017
Qualified Person List:
Carlos Barbosa, MAusIMM Rubens Mendonça, MAusIMM Girogio di Tomi, MAusIMM

(Lead QP, Technical (Mineral Reserves) (Mineral Processing)
Coordination and Mineral
SRK Consulting SRK Consulting
Resources)
SRK Consulting
September 7, 2017
Feasibility Study - Technical Report - Boa Esperança Copper Project - Brazil Page ii
1 Executive Summary
SRK Consultores do Brasil LTDA. (SRK) was commissioned by Ero Copper Corp (Ero) to prepare a
National Instrument 43-101 (NI 43-101) compliant Feasibility Study (FS) for the Boa Esperança
Deposit (Boa Esperança or the Project) as part of the Boa Esperança Project located in Pará, Brazil.
The Project was acquired by Mineraҫão Caraíba S.A. (MCSA) from Corporacion Nacional Del Cobre
(Codelco) in 2007 and is now 100% owned by MCSA. In December 2016, Ero Copper Corp. acquired
approximately 85.0% interest in MCSA. In June 2017, Ero acquired an additional 14.5% by subscribing
for shares from treasury for a total interest in MCSA of approximately 99.5%.
This Technical Report is an update of a prior 2015 report prepared by SRK. The original 2015 report
has been updated based on work performed throughout various studies developed for the Project by
third-party technical and engineering firms throughout the course of the Project’s ownership under
MCSA. SRK has reviewed the contents and, where relevant, has accepted and/or modified the
conclusions therein based on the judgment of the authors and the recommendations therein. There
has been no new material scientific or technical information about the property since the publication
of these reports. It is the opinion of the authors of this Technical Report that the information contained
in such reports has been appropriately reviewed and are current for the purposes of NI 43-101. A full
list of references relevant to the Project is listed in Chapter 27 – References.
1.1 Property Description and Location

The Boa Esperança copper deposit is located in the municipality of Tucumã, Pará State, Brazil. The
site is located approximately 40 km to the southwest of the town. Tucumã can be accessed by state
highway PA-279, which connects the town of Xinguara to the town of São Felix do Xingu, a stretch of
road that runs for approximately 160 km. The junction of PA-279 with federal highway BR-155 is in
Xinguara. The latter is the main highway leading to the city of Marabá, situated around 220 km north
of Xinguara.
1.2 Ownership
MCSA acquired the Boa Esperança copper deposit concession from Corporación Nacional del Cobre
(Codelco) in 2007 and became the legal owner of the mineral rights to the Boa Esperança copper
deposit. In December 2016, Ero acquired approximately 85.0% interest in MCSA. In June 2017, Ero
acquired an additional 14.5% by subscribing for shares from treasury for a total interest in MCSA of
approximately 99.5%.
The legal status of MCSA’s mining rights is as follows:
• The Final Exploration Report was presented to the DNPM on April 10, 2008 and was approved
by the DNPM on July 30, 2009;
• MCSA filed for the Mining Concession through the presentation of an Economic Exploitation
Plan (Plano de Aproveitamento Econômico or PAE), which was filed with the DNPM on May
5, 2010; and
• The Preliminary License was filed with the DNPM on March 22, 2012.
September 7, 2017
Feasibility Study - Technical Report - Boa Esperança Copper Project - Brazil Page iii
All criteria to obtain the mining rights have been fulfilled and the Ero is awaiting final approval of the
change status to a full Mining Concession after issuance of the Installation License, currently under
review by the Pará State environmental agency.
The Mineral Resources and Mineral Reserves disclosed in this report are completely contained within
the Exploration Licence held by MCSA. MCSA is either the beneficial owner or has the right to the
required surface rights for the envisioned operations.
1.3 Geology and Mineralization

The Carajás Mineral Province, where the Boa Esperança copper deposit is located, is on the east side
of the Amazon Craton and is considered one of the most important mineral provinces in Brazil. It is a
region of high economic importance, as it hosts the world’s largest known high-grade Fe deposits, as
well as world-class Cu-Au deposits, such as Salobo, Sossego, 118, Cristalino and Igarapé Bahia-
Alemão. Deposits of Mn, Ni, Cr, Al and Zn have also been identified in the province. The existence of
high-grade significant deposits elsewhere in the region provides no assurance regarding the size,
extent, grade, or value of any deposits or prospective deposits at the Boa Esperanҫa.
The Carajás Mineral Province encompasses two distinct tectonic domains, both of these Archean in
age. The South Block, which is the older of the two (3.0 to 2.86 Ga) and is where the Boa Esperança
deposit is located, is called the Rio Maria Block and contains a typical granite-greenstone belt terrain.
The North Block, which is the younger domain (2.8 to 2.5 Ga), is called Carajás and is composed of
volcano-sedimentary rocks and granitoids, which host the large Fe, Cu-Au, Mn, Ni and Zn deposits in
the province. These two blocks are considered to be products of the juxtaposition of volcanic island
arcs and plutonic-like Andes environments, associated with an intra-continental mantle plume.
The Boa Esperança copper deposit occurs within an isolated hill, which is elongated in a NNE direction
and located 38 km SW following a straight line from the town of Tucumã. The topographic high is
supported mainly by breccias composed of quartz and magnetite, which cut the Neoarchean biotite-
granite (2.78 Ga), the host of the copper mineralization. The Neoarchean biotite granite intrudes into
the Mesoarchean Rio Maria granodiorite (2.85 Ga).
Mineralization consists of a series of brecciated zones, which are aligned N60°-70°E and incline in a
SE direction (60°-70°SE). However, another alignment of about N40°E was observed in the field and
coincides with the elongation of the Boa Esperança hill.
1.4 Exploration Status

Project exploration has consisted of ground geological mapping and sampling, geophysical surveys
and exploration drilling. Ground geophysical surveys completed include magnetic and gravity surveys
and induced polarization electrical surveys.
The geophysical surveys were completed by Codelco during the period from 2003 to 2006. The
exploration work conducted by MCSA includes confirmation drilling conducted during the period from
2008 through 2013, and site-specific studies in support of this and prior feasibility studies.
September 7, 2017
Feasibility Study - Technical Report - Boa Esperança Copper Project - Brazil Page iv
The Project’s first drillhole campaign began in 2003 under the supervision of Codelco. Codelco
completed four drillhole campaigns in 2003-2004, 2005 and 2006. Codelco completed 62 core
drillholes, totaling 21,956.12 m on a 200 m x 200 m drilling grid that was infill drilled to 100 m x 100 m.
MCSA completed additional drilling between 2008 and 2013, totaling 36,016.13 m, for a project total
of 57,972.25 m in 165 core holes. Infill drilling was completed to approximately 50 and 25 m centers
for the core of the deposit.
The deposit has been drilled sufficiently to allow for the definition of Mineral Resources as defined
under NI 43-101.
1.5 Mineral Resource Estimate

The Mineral Resource estimate was prepared by SRK Senior Geologist Rafael Russo Sposito and
supervised by SRK Principal Resource Geologist Carlos César Barbosa; Mr. Barbosa is a Qualified
Person and is independent of MCSA as defined by NI 43-101.
The Mineral Resource estimate was prepared using a three-dimensional percentage block model of
10 m x 10 m x 5 m. In addition, oxidation state and resource classification codes were assigned to
each block. The resource estimation was conducted using Geovia GEMS™ (v6.6) software. Other
graphs were created using GSLIB software.
The Mineral Resources are constrained to a pit optimization shell run with the following parameters:
• Copper price: US$4.00 per pound;

• Mining cost: US$2.25/t moved;
• Processing cost + G&A: US$8.21/t processed;
• TC/RC: US$0.32/lb copper; and
• Recovery: 91%.
The internal copper CoG (excluding mining costs) is 0.20 %.
The Measured, Indicated and Inferred Mineral Resources within the pit optimization shell are given in
Table 1. The copper grades are undiluted grades within the grade shell wireframes.
September 7, 2017
Feasibility Study - Technical Report - Boa Esperança Copper Project - Brazil Page v
Table 1: Mineral Resource statement, Boa Esperança Copper Project, Pará State, Brazil, SRK
Consultores do Brasil LTDA., June 1, 2017
Quantity Contained Cu
Domain Category Cu %
(Mt) (tonnes)
Measured 41.00 0.81 332,100
Indicated 26.17 0.62 162,254
Sulfide
Measured + Indicated 67.17 0.73 490,341
Inferred 1.35 0.56 7,560
Secondary
Inferred 2.05 0.69 14,145
Sulfide
Total Measured 41.00 0.81 332,100
Indicated 26.17 0.62 162,254
Inferred 3.40 0.64 21,760
Source: SRK
(1) Tonnes and grade are rounded to reflect approximation.
(2) Mineral Resources are stated at a cut-off grade of 0.2% Cu and are fully contained within an optimized pit shell.
(3) Stated Mineral Resources are inclusive of Mineral Reserves.
Mineral Resources are not Mineral Reserves and have not demonstrated economic viability. Mineral
Resource estimates do not account for mineability, selectivity, mining loss and dilution. These Mineral
Resource estimates include Inferred Mineral Resources that are normally considered too geologically
speculative to allow for the application of economic considerations that would see them categorized
as Mineral Reserves. There is also no certainty that these Inferred Mineral Resources will be converted
to Measured and Indicated categories through further drilling or into Mineral Reserves once economic
considerations have been applied.
1.6 Mineral Reserve Estimate

The conversion of Mineral Resources to Mineral Reserves requires accumulated knowledge achieved
through pit optimization, pit design, economics and associated modifying parameters.
The Mineral Reserves were calculated based on a cut-off grade of 0.28% Cu and a life of mine (LoM)
copper price of US$ 7,000/t LME Cu.
In accordance with the CIM classification guidelines, only Measured and Indicated Mineral Resource
categories are converted to Proven and Probable Mineral Reserves respectively (through inclusion
within the open-pit mining limits). Inferred Mineral Resources, where unavoidably mined, have been
treated as waste and assigned zero grade.
Table 2 shows the Boa Esperança mine open pit ore reserve statement.
September 7, 2017
Feasibility Study - Technical Report - Boa Esperança Copper Project - Brazil Page vi
Table 2: Mineral Reserve Statement for the Boa Esperança copper deposit, State of Para,
Brazil, SRK Consultores do Brasil Ltda. as of June 1, 2017
Mineral Reserve Contained
Volume Density Dry Tonnes Cu
Classification Cu
m3 x 1,000 t/m3 t x 1,000 % t x 1,000
Proven 5,744.50 3.225 18,528.1 0.96 178.05
Probable 315.6 3.089 975.0 0.72 7.02
Total 6,060.10 3.218 19,503.1 0.95 185.07
(1) Effective Date: June 1, 2017

(2) Open pit Mineral Reserves assume full mine recovery;
(3) Open pit Mineral Reserves are diluted along lithological boundaries and assume selective mining unit of 2.5 m x 2.5 m x 5
m;
(4) The strip ratio was calculated to be 1.93 (waste to ore);
(5) Reserves are based on a price of US$ 7,000/t LME Cu throughout the life of the mine;
(6) Reserves are based on a cut-off grade of 0.28% Cu;
(7) Mineral Resource tonnage and contained metal have been rounded to reflect the accuracy of the estimate. As a result of
this rounding, the numbers may not add up;
(8) Contained copper is reported as in-situ and does not include process recovery; and
(9) The Mineral Reserve estimate was calculated by Rubens Mendonça, BSc, MBA, Chartered Professional Member of the
AusIMM, Mining Manager of SRK Consultores do Brasil, in accordance with the standards set out in CSA, NI 43-101 and
generally accepted CIM “Estimation of Mineral Resource and Mineral Reserves Best Practices” guidelines.
1.7 Mining Methods

Boa Esperança is a copper deposit, averaging approximately 0.95% Cu diluted grade within the
minable pit. The mineralization is close to the surface and the resource is appropriate for an open pit
mining operation.
The final pit design in this feasibility phase of the Boa Esperança project totals 19.5 Mt of Proven and
Probable Mineral Reserves with an average diluted grade of 0.95% Cu. From this total, 17.5 Mt is
classified as high grade material with an average Cu content of 1.02% and the remaining 2.0 Mt as
low grade material, with a grade of 0.34% Cu.
Waste materials amount to 37.7 Mt, which is comprised of 19.6 Mt of saprolite, 8.9 Mt of weathered
rock and 9.2 Mt of fresh rocks. The Life of Mine (LOM) strip ratio of waste to ore is 1.93.
The operation of the Boa Esperança mine will utilize conventional open pit mining techniques and
small size mining equipment to mine a total of 57.2 Mt of material over the life of the mine. This
comprises 19.5 Mt of ore and 37.7 Mt of waste materials. A total of 5.1 Mt of ore will be moved from
the stockpiles to the plant.
The main mine equipment selected for the Boa Esperança project consists of 4.0 m3 hydraulic
excavators, on-highway 35t trucks and drills.
It has been assumed that 100% of weathered and fresh rocks and 10% of saprolites will be drilled and
blasted in 10-meter-high benches. Ore will be hauled to the primary crusher or to the ROM stockpiles
close to the primary crusher. Waste materials will be hauled to different dumps and destinations. Grade
control will be performed through drilling, sampling and assaying materials within the pit limits using
the production drills.
September 7, 2017
Feasibility Study - Technical Report - Boa Esperança Copper Project - Brazil Page vii
The mine is scheduled to operate in three 8 hour shifts, 7 days per week, 365 days per year. Whenever
mine production needs to be reduced or interrupted, the primary crusher will be fed from the
regularization pile using a front-end loader.
1.7.1 Geotechnical
Three distinct layers of materials were identified: saprolite, weathered rocks and fresh rocks.
Based on the Planer Rupture models between berms performed in studies 8 and 9, steeper angles for
the excavated slopes in the weathered and fresh rocks have been proposed. However, for the
saprolite, a shallower angle is recommended, as this material forms a less cohesive soil and is more
likely to fail at steep slope face or inter-ramp angles.
Table 3 shows the slope geometry proposed by SRK for each type of material.
Table 3: Proposed angles for each type of material
Saprolite Weathered Rock Fresh Rock
Bench Heigth 10,0 m 10,0 m 10,0 m
Berm Width 7,0 m 5,0 m 5,0 m
Slope Face Angle 45º 70º 83º
Inter-Ramp Angle 31,5º 49º 58º
1.8 Mineral Processing and Metallurgical Testing

This section describes the experimental work performed with the samples of two different rock types
from Boa Esperança deposit, Tucumã, PA, namely "breccia" and "granite".
In early test work, the Boa Esperança deposit was considered as a conventional disseminated copper
deposit. However, it has two distinct geological features, a breccia and a granite rock type. The
sulphide minerals have been concentrated in faults and open spaces within the granite body.
An experimental program was developed in two primary stages to characterize the ore and evaluate
pre-concentration methods: bench scale testing performed on a trays jig, followed by continuous tests
with a small-scale pilot plant.
Their results confirmed the previous experimental conclusions:
• 30% of the crushing product is under 3mm and shows copper enrichment factors between 1.55
and 2.0 as compared to the ROM copper grade. The coarse fraction which fed the jig had a
copper grade enrichment factor between 0.75 and 0.8 of the ROM grade, implying copper is
mostly contained in the minus 3mm fraction.
• 50% of the mass was rejected in jigging. The copper recovery varied from 86% to 96%. Adding
to this recovery the recovery of the copper contained in the finer fraction (-3 mm) of the crushed
product, the total recovery of the circuit incresaed to 90% to96%.
September 7, 2017
Feasibility Study - Technical Report - Boa Esperança Copper Project - Brazil Page viii
• After the jigging continuous testing, the jig concentrate was crushed to minus 3.35 mm and
recombined with the natural fines (minus 3 mm) from each rock type then ground to 106 µm.
Locked cycle froth flotation locked tests were performed to concentrate the copper sulphide.
• The tailings of this initial flotation were refloated to concentrate pyrite (sequential flotation).
• The tailings of this second stage flotation were submitted to magnetic separation and yielded
an iron ore concentrate and the final fine tailing.
• The conclusion of this work is that pre-concentration is an effective method for rejecting a
significant mass of ROM feed, with minimum copper losses. In practice, this will reduce the size
of the crushing and concentrating plant and as a result - the capital and operating costs.
• It was also demonstrated that jigging using simple equipment as the AllMineral jig (a Baum-
type pneumatic jig) is effective. More sophisticated equipment, such as dense media
separators, or specialized jigs with artificial beds or for special use, are unnecessary.
• The pre-concentration study was followed by blending the jig concentrate with the minus 3 mm
of the ROM, grinding and performing froth flotation and magnetic separation testing.
• The main deleterious contaminants like F, Cl, U, As, P, Pb and Zn are present in the
concentrate in traces such that significant smelter penalties are not anticipated.
• Bond crushability indexes varied from 14.9 to 18.1 kWh/t, averaging 16.7 kWh/t indicating
difficult crushing plant feed.
• Bond ball mill work indexes ranged from 13.9 to 17.0 kWh/t with an average of 15.7 kWh/t,
indicating a medium/hard plant feed.
The result used to estimate the predicted recovery, as a function of feed grade is summarized in Figure
1. The blue line shows the recovery for ROM grades greater or equal to 0.57% Cu and the red shows
expected recovery for grades bellow 0.57% Cu.
Figure 1: Overall recovery (%) x ROM grade (% Cu)
September 7, 2017
Feasibility Study - Technical Report - Boa Esperança Copper Project - Brazil Page ix
1.9 Recovery Methods

Open pit mining is planned for a production rate of 2.31 million tonnes (Mt) per year at an average ore
grade of 1.14% Cu. Ore will be processed in a concentrator at a rate of 9,033.6 tonnes per day (t/d)
(primary crushing) using conventional processes considered standard to the industry. The processing
flowsheet, as well as the initial mass balance is based on work performed in 2011 by, “Consolidação
do Desenvolvimento de Processo – Projeto Boa Esperança”, dated January 2011 (the “2011
Metallurgical Report”), the results of which were reviewed and verified by SRK.
Although not used specifically as the basis for process design criteria, confirmatory variability test work
was undertaken by SGS-Geosol and reported in the following studies: “Final Report – Flotation
Testwork on Copper Samples from the Boa Esperança Project”, dated May 10, 2012 (the “2012
Metallurgical Report”). Subsequent to that work, several additional confirmatory campaigns were
conducted, producing the following reports:
• “VLC-Testes de sedimentação e filtração-15/12/14”;
• “Simulação de britagem Metso, novembro 2014”; and,
• “SGS Geosol – Testes de Wi-04/09/14”, “SGS Geosol – Final Report-Jigging, flotation and
magnetic separation on a composite sample for the Boa Esperança Project – Final Report –
SG0014-1403/rev02 – 10/04/2015”.
The final process design and mass balance was performed by incorporating a jigging pre-
concentration stage prior to flotation, based on favorable metallurgical testwork results.
1.9.1 Final Process Flowsheet Design

The process flowsheet includes three-stage crushing, screening, jigging, ball mill grinding, copper
rougher flotation, two stages of copper cleaner flotation and pyrite flotation from the copper rougher
and scavenger flotation tailing. The final copper concentrate is thickened prior to pressure filtration
and the flotation tailing is cycloned, dewatered, thickened and filtered prior to discharge to the tailing
storage facility. The pyrite concentrate from the pyrite flotation is sent to the high sulfur pond.
1.9.2 Final Process Material Balance

Process plant material balances have been developed for the crushing circuit, screening circuits,
jigging, grinding, copper flotation, regrind, pyrite flotation, concentrate / tailing thickeners and
dewatering circuits.
1.9.3 Final Process Plant Water Balance

The water balance includes the water requirements for both raw water and recycled process water. A
fresh water requirement of 143 m3/hr is estimated and is based on an overall process plant water
requirement of 560.8 m3/hr with 552.0 m3/hr being provided as recycled process water. Water losses
of 156.3 m3/hr are estimated. It is assumed that the gland seal water for pumps, water for reagents
preparation, potable water and make-up water will be provided by clean raw water. The rest of the
water requirements within the process plant will be from recycled process water.
September 7, 2017
Feasibility Study - Technical Report - Boa Esperança Copper Project - Brazil Page x
1.10 Tailings
SRK reviewed and relied upon the work performed by VOGBR during 2014-2015 who developed the
Basic Design of the B2 Dam and the Conceptual Design of the Water Pond that will be implemented
at the Boa Esperança Mine. The dams will have distinct purposes as shown below.
1.10.1 Water Pond

The reservoir of the water pond will have the purpose of storing clean water to meet the supply
demands of the plant, considering a flow of 150 m³/hour during uninterrupted operations for a year. In
December 2014 MCSA contracted VOGBR to develop the current work. The Water Pond will be built
in the Jatobá Creek, within the limits of the MCSA properties.
1.10.2 B2 Dam
The reservoir of the B2 Dam will have the purpose of containing the hazardous tailings resulting from
the copper ore beneficiation and to recover water to rationalize the use of new water, minimizing the
need to collect water in the waterbodies of the region. In December 2014 MCSA contracted VOGBR
to develop the current work. At that time, the construction of a waterproof dam constituted by a
compacted soil embankment to meet the new tailings volumes generated in the Boa Esperança
Copper Mine project was assessed. The considered operational life of the mine was 11 years.
The tailings to be deposited in the B2 Dam will be classified according to the ABNT NBR 10.004/2006
Standard as Class I tailings (hazardous). Since the tailings are Class I the B2 Dam shall be watertight
observing a minimum layer of non-saturated soil of 1.50m, measured between the bottom of the
deposit and the critical water level. In addition, the design shall include the definition of the leak
detection system and waterproofing system.
1.10.3 Tailings Storage

Studies for the Basic Design of saprolite and tailing dump aimed to define the geometry of its final
arrangement and to size the proposed structures to internal and surface drainage systems.
The geometry proposed for the dump was adequate with regards to the geotechnical stability, showing
security factors for normal and critical conditions equal to 1.5 and 1.3, respectively.
The final configuration of the dumps will consist of berms measuring 10 meters wide and benches with
10 meters’ height, with final angle of 2H:1V, after compaction of the tailing and enveloping with
compacted soil of the saprolite and tailings dump. The volumetric capacity for the disposal of tailing
and waste in the final configuration is 15.4 Mm³.
The bottom drain system will be used to collect the contributions from the input of incident waters in
the dump, avoiding its saturation. These drains should be protected by a saprolite layer, to prevent
that the traffic or surface draining damages the granular material of the section.
The materials to be disposed will be transported by conveyor belts, in the case of the waste processing
plant, and dump trucks from the pit, in the case of the saprolite.
1.10.4 Hydrology
Studies conducted in the period of January to November 2011, consisted of the following steps:
• Inventory of water sources and users;
September 7, 2017
Feasibility Study - Technical Report - Boa Esperança Copper Project - Brazil Page xi
• Flow measurements in major drainages;

• Preparation of hydrogeological conceptual model;
• Evaluation of impacts to water resources;
• Assessment of water availability; and
• Projection of the monitoring network.
During the months of February and September 2011 flow measurements related to the rainy and dry
periods were conducted in the Project area in conjunction with environmental permit work. In each of
these periods five different points located in the main drainages were established for the
implementation of flow measurements. Also in the month of September a flow measurement was held
in the Branco River, located approximately 15 km south of the Project.
The hydrogeological system in the region has the typical characteristics of formations located in
crystalline basement aquifers. This is an aquifer consisting of a shallow weathered mantle with metric
thickness (Porous Aquifer), superimposed over the crystalline basement (Fractured Aquifer), deformed
and fractured.
The results indicate that the Project area has a low water potential, as many springs and surface water
bodies have intermittent flow, becoming dried during the dry season. The underground reservoirs were
also evaluated as an alternative to water capturing. However, tests performed in tubular wells showed
low production capacity, with pump flow rate of about 6 m³ / h.
The water pond designed by VOGBR will have the purpose of storing clean water to meet the demand
of the plant, estimated at a flow of 150m³/hour, working for a year without interruption. The water pond
will be located in the Jatobá stream, within the area owned by MCSA.
1.10.5 Project Infrastructure

Based on the estimated production volumes of copper concentrates, the best logistic alternatives
between the Project and ports have been reviewed.
Tucumã, PA was considered as the starting point for the Project, considering:
• Domestic transportation;
• Cargo handling at the port;
• Sea transportation.
For domestic transportation, haulage by truck appears to be the only viable ground transportation.
Although Para’s State is crossed by the Carajas’ Railroad and the Tocantins River, both of these
alternatives present some deficiencies that hinder the utilization of the routes.
Vila do Conde has shown the best conditions for loading since Itaqui is limited to train transport options.
Further, Vila do Conde is a better organized industrial port, with ample area which can be leased from
the port authorities or from third companies.
The primary logistic challenges facing the Project are:
• Long distance to port;

• Limited accessibility to the railroad, owned by a private company with a track record of poor
third-party service levels;
• Limited port infrastructure; and,
September 7, 2017
Feasibility Study - Technical Report - Boa Esperança Copper Project - Brazil Page xii
• Chronic congestion at ports near the Project.
1.10.6 Environmental Management and Permitting

The Pará State Environmental Agency granted a Preliminary License to MCSA on March 7, 2012
which was subsequently renewed on June 19, 2013. MCSA filed for an Installation License request on
April 1, 2013 which is currently under analysis.
A grant for well drilling and evaluation of water potential (considering future groundwater collection for
the installation phase) was issued. The formal request for water use will be submitted immediately
after the issuance of the Installation License (IL).
The IL is prepared when the project design has advanced far enough for engineering plans to be
submitted to the government for approval. The IL is accompanied by an Environmental Control Plan
referred to as a PCA (Plano de Controle Ambiental) and a Degraded Area Recovery Plan or PRAD
(Plano de Recuperação de Áreas Degradadas). Once the IL has been granted, the DNPM can issue
a Mining Concession. It is at this licensing stage that the Legal Reserve is defined. The Legal Reserve
is an area whose size depends on state rules requiring the preservation of a portion of the natural
biota. It is legalized by the Rural Environmental Register (Cadastro Ambiental Rural – CAR) or at the
Real Estate Notary Office as property of the enterprising party, in accordance with Federal Law #
12.651/2012. In Pará the law has established that 80% of the propriety area should remain as a Legal
Reserve. This percentage may be changed depending on the specific conditions of Environmental –
Economical Zone in each region. This is regulated by the Brazilian Forest Code, Law # 12.651/2012
and Pará State Decree # 2.099/2010.
The area earmarked for deforestation covers 38.65 ha at this stage of the project. The Legal Reserve
is being discussed with the Environmental Agency (SEMA) and will be a condition of the IL. The
environmental agency is analyzing the IL process for the granting of this license.
The Operating License (OL) allows the project to begin operations and is issued after all of the
appropriate environmental measures have been implemented and verified by the authorities. The OL
must be renewed during the life of the mine. When the OL is up for renewal, a report summarizing
environmental performance must be presented.
If, during the operation, there are substantial changes to the initial project plan (e.g. an additional
treatment plant), this will require another specific IL, which will subsequently become an OL.
The baseline characterization studies and environmental impact assessment (EIA) for the Project were
prepared and submitted to SEMA in 2008.
The EIA classifies areas of influence into three categories:
• Área Diretamente Afetada (ADA) = Directly Affected Area;

• Área de Influência Direta (AID) = Directly Influenced Area; and
• Área de Influência Indireta (AII) = Indirectly Influenced Area.
Changes to the boundary of the Project area were necessary due to a demand made by the Pará
State Environmental Agency during the review of the PL application. The ADA now includes village
P07 and drainage of about 200m, which were previously not included. This update added
September 7, 2017
Feasibility Study - Technical Report - Boa Esperança Copper Project - Brazil Page xiii
approximately 1,202.1 ha to the ADA. Additionally, the AID now includes springs which flow to the
Branco River and Jatobá Creek. The main drainage affected by the project totals 7,204.4 ha.
The final Environmental Control Plan (PCA) was submitted to the environmental agency in April, 2013,
and the Company is waiting for grant of the Installation License which is necessary for construction,
and ultimately, mining activities, post conversion to an Operating License.
1.11 Economic Analysis

Forecast copper prices over the LOM are presented in Table 4.
Table 4: Copper Prices - US$/t-Cu
Commodity Yr -2 Yr -1 Yr 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7 Yr 8 Yr 9
Metallic
6,063 6,614 6,614 6,614 6,614 6,614 6,614 6,614 6,614 6,614 6,614
Copper
The price of the copper concentrate is considered CIF at the port of Shanghai, China. Logistics costs
to transport copper concentrate from Boa Esperança to China are presented in Table 5 and Table 6.
The logistic cost was considered as 50% "Bulk" and 50% "Container". The economic analysis also
considered losses of 0.2% in concentrate transportation for both cases.
September 7, 2017
Feasibility Study - Technical Report - Boa Esperança Copper Project - Brazil Page xiv
Table 5: Logistic Costs - Container

Items Cost (R$/t-conc)
Copper Project Conc (Truck) 175.01
Handling & Storage (Port) 124.39
Ocean Freight 132.30
Total Freight R$431.71
Table 6: Logistic Costs - Bulk

All currency is in Brazilian Reais ($R) unless otherwise stated. The following exchange rates have
been considered throughout the economic section of the report
Table 7: Exchange Rates

Exchange Rate (R$ per US$)
Currency Yr -2 Yr -1 – Yr 9
Reais $3.60 $3.80
1.11.1 Capital Expenditures

The capital cost estimate developed for this Feasibility Study comprises the costs associated with the
engineering, procurement, construction, commissioning and pre-operation required for all project
facilities. SRK relied upon third-party estimation based on studies developed for the project by
engineering firms according to the following scope:
• SRK Consulting - Mine Equipment Schedule, Mineral Resources, Mineral Reserves, mine
equipment capital and mining operating costs, environment and mine closure;
• Tecnomin Projects e Consultoria Ltda (Minas Gerais, Brazil) - Plant basic engineering;
• Tyno Consultoria Tributária e Empresarial Ltda (Bahia, Brazil) - Fiscal;
• VOGBR Recursos Hídricos & Geotecnia (Minas Gerais, Brazil) - Basic Project of Tailings Dam
and Conceptual Design of Water Pond.
The required quotations for equipment, materials and services were obtained mainly by MCSA’s
Procurement Department (MCPD) and formal enquiries to well-known vendors in the mining business
mainly in the 2nd quarter 2015. Based on the deceleration in global mining activity and contraction in
the Brazilian economy from the period of 2015 to 2017, no escalation was applied for the current
capital cost estimates. SRK has reviewed the costing and third-party reports and is of the opinion that
the the estimates are valid for the purposes of this report.
The capital estimate is shown in Table 8.
September 7, 2017
Feasibility Study - Technical Report - Boa Esperança Copper Project - Brazil Page xv
Table 8: Capital Costs Summary by Area

Area % of Total LoM Cost (R$000’s) Initial (R$000’s) Ongoing (R$000’s)
Pre-Production 14 89,306 89,306 0
Infrastructure 1 6,615 6,615 0
Mine 8 48,075 35,778 12,298
Plant 39 244,109 244,109 0
Power & Automation 12 76,709 76,709 0
Utility Systems 2 12,065 12,065 0
Administration & Support 4 23,562 23,562 0
Tailings Storage Facilities 7 45,439 45,439 0
Water Pond 1 6,398 6,398 0
Indirect Costs 10 59,740 59,740 0
Salvage -4 (24,796) 0 (24,796)
Closure 6 39,898 0 39,898
Total 100% R$627,120 R$599,721 R$27,400
1.11.2 Operating Costs

Operating costs are based on mine, process, tailings and infrastructure facilities design criteria,
engineering, as well as budgetary and vendor quotes. All operating costs include supervision staff,
operations labor, maintenance labor, consumables, electricity, fuels, lubricants, maintenance parts
and any other operating expenditure identified by contributing engineers. The operating costs are
shown on Table 9.
Table 9: Project Operating Costs

Item R$/t-RoM R$/t-Conc LoM (R$000’s)
Mining 15.69 561.27 305,774
Processing 19.28 689.72 375,741
G&A 9.54 341.59 186,086
Total R$44.48 R$1,592.58 R$867,598
1.11.3 Economic Results

The financial analysis results, shown on Table 10, indicate an after-tax net present value (NPV) for the
project at an 8% discount rate of US$195.3 million with an IRR of 32.7%. Payback from Project start
is approximately 3.6 years.
September 7, 2017
Feasibility Study - Technical Report - Boa Esperança Copper Project - Brazil Page xvi
Table 10: Economic Results

Item Unit or Factor Value
Ore Mined kt 19,500.3
Mined Cu (contained) kt 185.0
Recovered Cu kt 163.4
Payable Cu kt 156.9
Sales Volumes, Prices and Delivery Costs
Cu Price (average over production period) $/t-Cu 6,614
Treatment Charges (TC) US$/t conc. 78.50
Refining Charges (RC) ¢/lb 7.85
Tonnes Cu sold kt 156.9
Revenue
Gross Revenue R$000’s 3,943,195
Logistics & Sales Costs R$000’s (333,113)
CFEM Royalty R$000’s (63,104)
Gross Income R$000’s 3,546,942
TC / RCs R$000’s (454,875)
Net Revenue R$000’s 3,488,320
Operating Costs
Mining R$000’s (305,774)
Process R$000’s (375,741)
G&A R$000’s (186,086)
Total Operating Costs R$000’s (867,600)
Project Capital (Equity) R$000’s (626,126)
Financing Interest R$000’s -
Income & Social Contribution Taxes R$000’s (251,907)
Operating Cash Flow R$000’s 1,972,596
Initial Capital R$000’s 599,719
Equity for funding R$000’s -
Share Holders Equity R$000’s 599,719
Ongoing Capital R$000’s 12,298
Free Cash Flow R$000’s 1,345,477

After-tax NPV 8% (per annum) U$000’s 195,295
IRR 32.7%
Payback Yrs 3.6
1.12 Conclusions and Recommendations

Conclusions
SRK concurs with the geological interpretation of the mineralization of the Boa Esperança deposit as
silica- and sulfide-filled breccias containing copper and cobalt mineralization associated with
magnetite, as a variant of an IOCG hydrothermal deposit type. SRK concludes that the mineralization
has been sufficiently defined through exploration methods, including core drilling, to support the
Mineral Resource and Mineral Reserve estimation for use in a Feasibility Study.
SRK has carried out the appropriate review work to satisfy itself that the Mineral Reserve can be
technically and profitably extracted through to the production and sale of copper concentrate.
Consideration has been given to all technical areas of study, the associated capital and operating
costs, and relevant factors including marketing, permitting, environmental and social. SRK is satisfied
that the technical and economic feasibility has been demonstrated.
September 7, 2017
Feasibility Study - Technical Report - Boa Esperança Copper Project - Brazil Page xvii
The Mineral Resource and Mineral Reserve Estimates are compliant within the guidelines of NI 43-
101 and SRK has not identified any mining, metallurgical, infrastructure, permitting, legal, political,
environmental, technical, or other relevant factors that could materially affect the potential
development of estimated Mineral Reserves and Mineral Resources.
Recommendations
SRK recommends that analytical procedures be standardized, including documentation of procedures,

performing check assays and duplicate sampling to provide increased confidence in the database.
SRK also recommends that the tailings filter sizing should be confirmed based on updated material
characterization incorporating cyclone and dewatering screen additions to optimize the process and
to support the analysis of a filter press to replace the vacuum filter belt.
In addition, it is recommended that social-environmental management practices be undertaken to

ensure the success of the operation as well as a review of acid rock potential, and the potential
operating costs associated with its treatment.
Finally, SRK recommends that a conceptual geomechanical model be developed to ensure final pit
dimensions.
The estimated cost for the recommended work is presented below in Table 1.11.
Table 1.11: Proposed Budget for Recommended Work
Budget
Program (US$)
Check assays at secondary laboratory $6,000
Duplicate core samples, including cutting, shipping & analysis 12,000
Confirm tailings thickener design and filter sizing 40,000
Expand studies on acid rock drainage and treatment 32,000
Develop a conceptual geomechanical model 30,000
Total $120,000
September 7, 2017
Feasibility Study - Technical Report - Boa Esperança Copper Project - Brazil Page xviii
Table of Contents
1 Executive Summary ..................................................................................................... ii

1.1 Property Description and Location ...................................................................................................... ii
1.2 Ownership ........................................................................................................................................... ii
1.3 Geology and Mineralization ............................................................................................................... iii
1.4 Exploration Status .............................................................................................................................. iii
1.5 Mineral Resource Estimate ................................................................................................................ iv
1.6 Mineral Reserve Estimate ................................................................................................................... v
1.7 Mining Methods .................................................................................................................................. vi
1.7.1 Geotechnical ......................................................................................................................... vii
1.8 Mineral Processing and Metallurgical Testing .................................................................................. vii
1.9 Recovery Methods ............................................................................................................................. ix
1.9.1 Final Process Flowsheet Design ............................................................................................ ix
1.9.2 Final Process Material Balance.............................................................................................. ix
1.9.3 Final Process Plant Water Balance........................................................................................ ix
1.10 Tailings ................................................................................................................................................ x
1.10.1 Water Pond ............................................................................................................................. x
1.10.2 B2 Dam.................................................................................................................................... x
1.10.3 Tailings Storage ...................................................................................................................... x
1.10.4 Hydrology ................................................................................................................................ x
1.10.5 Project Infrastructure .............................................................................................................. xi
1.10.6 Environmental Management and Permitting ......................................................................... xii
1.11 Economic Analysis ............................................................................................................................xiii
1.11.1 Capital Expenditures ............................................................................................................ xiv
1.11.2 Operating Costs .................................................................................................................... xv
1.11.3 Economic Results.................................................................................................................. xv
1.12 Conclusions and Recommendations ............................................................................................... xvi
2 Introduction .................................................................................................................. 1
2.1 QP Personal Inspections .................................................................................................................... 1
3 Reliance on Other Experts .......................................................................................... 2
3.1 Sources of Information and Extent of Reliance .................................................................................. 2
3.2 Effective Date ...................................................................................................................................... 2
3.3 Units of Measure ................................................................................................................................. 2
4 Property Description and Location ............................................................................ 3
September 7, 2017
Feasibility Study - Technical Report - Boa Esperança Copper Project - Brazil Page xix
4.1 Property Description and Location ...................................................................................................... 3

4.2 Mineral Titles ....................................................................................................................................... 3
4.2.1 Nature and Extent of Issuer’s Interest ..................................................................................... 4
5 Accessibility, Climate, Local Resources, Infrastructure and Physiography .......... 5
5.1 Topography, Elevation and Vegetation ............................................................................................... 5
5.2 Climate and Length of Operating Season ........................................................................................... 5
5.3 Access to Property .............................................................................................................................. 6
5.4 Surface Rights..................................................................................................................................... 7
6 History........................................................................................................................... 8
7 Geological Setting and Mineralization ..................................................................... 10
7.1 Regional Geology.............................................................................................................................. 10
7.2 Local Geology ................................................................................................................................... 11
7.3 Property Geology .............................................................................................................................. 19
7.4 Significant Mineralized Zones ........................................................................................................... 24
8 Deposit Type .............................................................................................................. 25
8.1 Geological Model .............................................................................................................................. 25
9 Exploration ................................................................................................................. 27
9.1 Mapping and Sampling (Codelco)..................................................................................................... 27
9.2 Geophysical Surveys (Codelco)........................................................................................................ 27
9.3 Drilling (Codelco)............................................................................................................................... 27
9.4 Drilling (MCSA) ................................................................................................................................. 28
9.5 Relevant Exploration Work ............................................................................................................... 28
9.6 Surveys and Investigations ............................................................................................................... 28
9.7 Significant Results and Interpretation ............................................................................................... 28
10 Drilling......................................................................................................................... 29
10.1 Type and Extent ................................................................................................................................ 29
10.2 Procedures ........................................................................................................................................ 29
10.3 Interpretation and Relevant Results.................................................................................................. 30
11 Sample Preparation, Analysis and Security ............................................................ 32
11.1 Methods ............................................................................................................................................ 32
11.2 Security Measures ............................................................................................................................ 32
11.3 Sample Preparation .......................................................................................................................... 32
11.3.1 Laboratories .......................................................................................................................... 33
11.4 Quality Assurance and Quality Control Programs ............................................................................ 33
11.5 SRK Comments ................................................................................................................................ 34
12 Data Verification ......................................................................................................... 35
12.1 Procedures ........................................................................................................................................ 35
September 7, 2017
Feasibility Study - Technical Report - Boa Esperança Copper Project - Brazil Page xx
12.2 Verification of Analytical Quality Control Data .................................................................................. 35

12.3 Data Adequacy.................................................................................................................................. 36
13 Mineral Processing and Metallurgical Testing ........................................................ 37
13.1 Pre-concentration and Processing Report ........................................................................................ 37
13.2 Previous Work ................................................................................................................................... 39
13.3 Suitability of Boa Esperança Rock types to Pre- Concentration and Flotation ................................. 43
13.4 Experimental Work on Pre-concentration ......................................................................................... 44
13.4.1 Alfenas University.................................................................................................................. 44
13.4.2 SGS Geosol .......................................................................................................................... 45
13.4.3 Fundação Gorceix – Pre-concentration test.......................................................................... 46
13.4.4 Mintec 47
13.4.5 Jigging tests .......................................................................................................................... 47
13.4.6 Flotation and Magnetic Separation Tests of the Jig Concentrate Recombined with the ROM -
3 mm Size Fraction ............................................................................................................... 53
13.5 Conclusions....................................................................................................................................... 54
14 Mineral Resource Estimate ....................................................................................... 59
14.1 Modeling Coordinate System ............................................................................................................ 59
14.2 Drillhole Data..................................................................................................................................... 59
14.3 Topography ....................................................................................................................................... 62
14.4 Geologic Model ................................................................................................................................. 62
14.5 Exploration Data Analysis ................................................................................................................. 64
14.6 Contact Analysis ............................................................................................................................... 69
14.7 Specific Gravity ................................................................................................................................. 70
14.8 Variogram Analysis and Modeling .................................................................................................... 72
14.9 Block Model....................................................................................................................................... 78
14.10Estimation Methodology .................................................................................................................... 80
14.11Model Validation................................................................................................................................ 80
14.12Resource Classification .................................................................................................................... 85
14.13Mineral Resource Statement ............................................................................................................ 85
14.14Mineral Resource Sensitivity ............................................................................................................. 87
15 Mineral Reserve Estimates........................................................................................ 89
15.1 Reserve Estimation ........................................................................................................................... 89
15.2 Reserve Statement ........................................................................................................................... 89
16 Mining Methods .......................................................................................................... 91
16.1 Project Data and Criteria ................................................................................................................... 91
16.2 Pit Slope Geotechnical Evaluation and Final Pit Geometry Review ................................................. 95
16.2.1 Project Configuration ............................................................................................................. 95
16.2.2 Material Parameters .............................................................................................................. 98
September 7, 2017
Feasibility Study - Technical Report - Boa Esperança Copper Project - Brazil Page xxi
16.2.3 Methodology .......................................................................................................................... 98

16.2.4 Results 99
16.2.5 Conclusions and Recommendations................................................................................... 106
16.3 Final Pit Optimization and Design ................................................................................................... 107
16.3.1 Final Pit Optimization .......................................................................................................... 107
16.3.2 Final Pit Design ................................................................................................................... 110
16.4 Mine Scheduling.............................................................................................................................. 113
16.4.1 Project Data, Parameters, Criteria and Assumptions ......................................................... 113
16.4.2 Pushback Design ................................................................................................................ 115
16.4.3 Mine Scheduling Results ..................................................................................................... 116
16.4.4 Comparison to Solutions Without Stockpiles ...................................................................... 120
16.5 Mine Operation and Equipment Requirements ............................................................................... 123
16.5.1 Mine Operation .................................................................................................................... 123
16.5.2 Mine Equipment Selection .................................................................................................. 127
16.5.3 Mine Equipment Requirements ........................................................................................... 128
16.5.4 Blasting ................................................................................................................................ 131
16.6 Labor Requirements ....................................................................................................................... 131
16.7 Mine Infrastructure .......................................................................................................................... 133
17 Recovery Methods ................................................................................................... 136
17.1 Operation Results ........................................................................................................................... 136
17.2 Processing Methods........................................................................................................................ 136
17.2.1 Crushing Plant ..................................................................................................................... 136
17.2.2 Jigging Plant ........................................................................................................................ 137
17.2.3 Grinding Circuit .................................................................................................................... 137
17.2.4 Copper and Pyrite Flotation ................................................................................................ 137
17.2.5 Thickening and Filtration ..................................................................................................... 138
17.2.6 Water Recirculation ............................................................................................................. 138
17.2.7 Intake Raw Water ................................................................................................................ 139
17.2.8 Drinking Water ..................................................................................................................... 139
17.2.9 Sealing Water ...................................................................................................................... 139
17.2.10 Compressed Air ...................................................................................................... 139
17.2.11 Reagent Preparation .............................................................................................. 139
17.3 Design Criteria ................................................................................................................................ 140
17.3.1 Run of Mine Plant Feed Characteristics.............................................................................. 141
17.3.2 Production Schedule ........................................................................................................... 141
17.4 Plant Design and Equipment Characteristics ................................................................................. 141
17.5 Process Plant Operating Costs ....................................................................................................... 143
17.6 Plant Power ..................................................................................................................................... 144
September 7, 2017
Feasibility Study - Technical Report - Boa Esperança Copper Project - Brazil Page xxii
17.7 Reagents ......................................................................................................................................... 144

17.8 Other Plant Consumables ............................................................................................................... 145
17.9 Plant Labor ...................................................................................................................................... 147
17.10Process Plant Water Balance ......................................................................................................... 149
18 Project Infrastructure............................................................................................... 151
18.1 Site Access ..................................................................................................................................... 151
18.2 Power 151
18.2.1 Load Requirement ............................................................................................................... 151
18.2.2 Electrical Power Source ...................................................................................................... 151
18.2.3 Main Substation................................................................................................................... 151
18.2.3.1 5005-SE-01 – Primary Crushing Area Substation .............................................152
18.2.3.2 5010-SE-01 – Re-Crushing, Jigging and Screening Area Substation; ..............153
18.2.3.3 5015-SE-01 – Grinding, Re-milling, Thickening, Flotation and Water Distribution
Area Substation ......................................................................................................153
18.2.3.4 5020-SE-01 – Filtering, Reagents and Air Distribution ......................................154
18.2.3.5 5030-SE-01 – Raw Water Capture and 5035-SE-01 – Waste Water Capture ..154
18.2.3.6 5040-SE-01 – Auxiliary Buildings and Facilities ................................................154
18.2.4 Electric Power Distribution .................................................................................................. 155
18.3 Water Supply................................................................................................................................... 155
18.4 Ancillary Buildings and Facilities ..................................................................................................... 156
18.4.1 Administration Building and Offices .................................................................................... 156
18.4.2 Laboratory ........................................................................................................................... 156
18.4.3 Warehouse and Yard Storage ............................................................................................. 157
18.4.4 Process Operations Workshop ........................................................................................... 157
18.4.5 Mine Dry .............................................................................................................................. 157
18.4.6 Mine Equipment Maintenance Shop ................................................................................... 157
18.4.7 Truck Wash ......................................................................................................................... 158
18.4.8 Explosives Storage Magazine ............................................................................................. 158
18.4.9 Gatehouse and Weigh-Scale .............................................................................................. 158
18.4.10 Fuel and Lube Storage ........................................................................................... 159
18.4.11 Core Shed............................................................................................................... 159
18.5 Other Services ................................................................................................................................ 159
18.5.1 First Aid Clinic and Fire Protection Building ........................................................................ 159
18.5.2 Fire Protection ..................................................................................................................... 159
18.5.3 Canteen ............................................................................................................................... 160
18.5.4 Sewage Treatment .............................................................................................................. 160
18.5.5 Refuse Storage ................................................................................................................... 160
18.5.6 Communications.................................................................................................................. 161
September 7, 2017
Feasibility Study - Technical Report - Boa Esperança Copper Project - Brazil Page xxiii
18.6 Off-Site Infrastructure ...................................................................................................................... 161

18.6.1 Transportation of Concentrate ............................................................................................ 161
18.6.2 Road Detail .......................................................................................................................... 162
18.6.3 Port – Vila do Conde ........................................................................................................... 163
18.7 Tailings Storage Facilities ............................................................................................................... 164
18.7.1 Water Pond ......................................................................................................................... 164
18.7.2 B2 Dam................................................................................................................................ 164
18.7.3 Geological-Geotechnical Surveys and Field Laboratory Tests–B2 DAM ........................... 165
18.7.3.1 Geological-Geotechnical Survey .......................................................................165
18.7.3.2 Laboratory Tests ................................................................................................166
18.7.4 Dam Layout ......................................................................................................................... 167
18.7.4.1 Water Pond ........................................................................................................167
18.7.4.2 B2 Dam ..............................................................................................................167
18.7.5 Final Considerations............................................................................................................ 168
18.8 Logistics .......................................................................................................................................... 172
18.9 Introduction ..................................................................................................................................... 172
18.9.1 Design Concepts ................................................................................................................. 173
18.9.2 Design Parameters – Expected flow and project schedule................................................. 173
18.10Ground Transportation .................................................................................................................... 174
18.10.1 Truck Transportation .............................................................................................. 174
18.11Port Analysis ................................................................................................................................... 175
18.11.1 Vila do Conde ......................................................................................................... 176
18.11.2 Itaqui ....................................................................................................................... 177
18.11.3 Warehouses in the Possible Transfer Areas .......................................................... 179
18.12Investment & Transport Costs ........................................................................................................ 180
18.12.1 Preferred Logistics Alternative................................................................................ 181
18.13Ocean Freight ................................................................................................................................. 183
18.13.1 Bulk ......................................................................................................................... 183
18.13.2 Container ................................................................................................................ 184
18.14Capex & Opex Comparison ............................................................................................................ 184
18.14.1 Capex ..................................................................................................................... 184
18.14.2 Opex ....................................................................................................................... 184
18.15Conclusion ...................................................................................................................................... 185
19 Market Studies and Contracts ................................................................................ 187
19.1 Market Studies ................................................................................................................................ 187
19.2 Contracts ......................................................................................................................................... 188
20 Environmental Studies, Permitting and Social or Community Impact ................ 189
September 7, 2017
Feasibility Study - Technical Report - Boa Esperança Copper Project - Brazil Page xxiv
20.1 Historical Context of Tucumã .......................................................................................................... 189

20.2 Environmental Laws and Licensing ................................................................................................ 190
20.2.1 Reclamation of Degraded Areas ......................................................................................... 190
20.2.2 International Finance Corporation Performance Standards................................................ 190
20.3 Licensing Requirements ................................................................................................................. 191
20.3.1 Mining Rights Status ........................................................................................................... 191
20.3.2 Environmental Licenses ...................................................................................................... 191
20.4 Physiography, Flora and Fauna ...................................................................................................... 192
20.4.1 Soil and Sediments ............................................................................................................. 192
20.4.2 Local Hydrography .............................................................................................................. 195
20.4.3 Water Availability ................................................................................................................. 196
20.4.4 Aquifer Systems and Hydrogeological Aspects .................................................................. 197
20.4.5 Flora and Fauna .................................................................................................................. 198
20.5 Environmental Studies .................................................................................................................... 200
20.5.1 Classification of Areas of Influence ..................................................................................... 200
20.5.2 Protected Areas................................................................................................................... 201
20.5.3 Legal Reserve ..................................................................................................................... 202
20.5.4 Agrarian Reform Areas........................................................................................................ 202
20.5.5 Conceptual design of the Dam ............................................................................................ 203
20.6 Environmental Impacts and Mitigation ............................................................................................ 203
20.7 Environmental Impact Issues .......................................................................................................... 207
20.7.1 Pollution and Water Quality ................................................................................................. 207
20.7.2 Acid Rock Drainage............................................................................................................. 212
20.7.3 Static Tests for Evaluation the Potential for Acid Rock Drainage Formation ...................... 213
20.8 Environmental Compensation ......................................................................................................... 216
20.9 Communication with Stakeholders.................................................................................................. 217
20.9.1 Program for the Monitoring of Socio-Economic Indicators.................................................. 218
20.9.2 Social Communication Program.......................................................................................... 218
20.9.3 Environmental Education .................................................................................................... 219
20.9.4 Labor jobsite Hiring ............................................................................................................. 219
20.9.5 Support for the local development forum ............................................................................ 220
20.10Mining Closure and Reclamation .................................................................................................... 220
20.11Recommendations .......................................................................................................................... 223
21 Capital and Operating Costs ................................................................................... 224
21.1 External Considerations .................................................................................................................. 224
21.1.1 Economic Considerations.................................................................................................... 224
21.1.2 Common Elements .............................................................................................................. 224
21.2 Capital Costs ................................................................................................................................... 225
September 7, 2017
Feasibility Study - Technical Report - Boa Esperança Copper Project - Brazil Page xxv
21.2.1 Introduction .......................................................................................................................... 225

21.2.2 Methodology ........................................................................................................................ 227
21.2.2.1 Supply Only........................................................................................................228
21.2.2.2 Selection Bids ....................................................................................................228
21.2.2.3 Capital Cost Estimate Structure.........................................................................228
21.2.2.4 Direct Costs .......................................................................................................230
21.2.3 Direct Costs ......................................................................................................................... 234
21.2.3.1 Pre-Production ...................................................................................................234
21.2.3.2 Infrastructure ......................................................................................................234
21.2.3.3 Mine ...................................................................................................................235
21.2.3.4 Plant ...................................................................................................................236
21.2.3.5 Power & Automation ..........................................................................................237
21.2.3.6 Utilities System ..................................................................................................237
21.2.3.7 Administration & Support ...................................................................................238
21.2.3.8 Tailings Storage Facilities ..................................................................................239
21.2.3.9 Water Pond ........................................................................................................239
21.2.4 Indirect Costs ...................................................................................................................... 239
21.2.4.1 Properties Improvements ...................................................................................239
21.2.4.2 Land Acquisition and Other Services.................................................................240
21.2.4.3 Owner Operated Pre-Production Labor .............................................................240
21.2.4.4 Engineering Services, Management and Other services ..................................240
21.2.4.5 Start-up Expenses .............................................................................................241
21.2.4.6 Freight ................................................................................................................241
21.2.4.7 Financial Compensation ....................................................................................241
21.2.4.8 Spare Parts ........................................................................................................241
21.2.4.9 Insurance ...........................................................................................................241
21.2.5 Closure & Salvage............................................................................................................... 242
21.2.6 Contingency ........................................................................................................................ 243
21.3 Operating Cost Estimates ............................................................................................................... 243
21.3.1 Basis for Operating Costs Estimate .................................................................................... 243
21.3.2 Mine 244
21.3.2.1 Diesel .................................................................................................................244
21.3.2.2 Lube ...................................................................................................................246
21.3.2.3 Blasting ..............................................................................................................246
21.3.2.4 Drilling ................................................................................................................247
21.3.2.5 Tires ...................................................................................................................247
21.3.2.6 Spare Parts and Other Wear Parts ....................................................................247
September 7, 2017
Feasibility Study - Technical Report - Boa Esperança Copper Project - Brazil Page xxvi
21.3.2.7 Other Operating Costs .......................................................................................248

21.3.2.8 Mine Labor .........................................................................................................249
21.3.3 Plant 252
21.3.3.1 Plant Electric Power ...........................................................................................252
21.3.3.2 Reagents ............................................................................................................253
21.3.3.3 Wear Parts .........................................................................................................254
21.3.3.4 Spare Parts ........................................................................................................256
21.3.3.5 Potential Acid Drainage .....................................................................................256
21.3.3.6 Plant Labor .........................................................................................................256
21.3.4 G&A 258
21.3.4.1 G&A Labor .........................................................................................................258
22 Economic Analysis .................................................................................................. 260

22.1.1 Principal Assumptions ......................................................................................................... 260
22.1.2 Indicative Economics........................................................................................................... 261
22.1.3 Cashflow Forecasts and Annual Production Forecasts ...................................................... 262
22.1.4 Taxes, Royalties and Other Interests .................................................................................. 264
22.1.5 Sensitivity Analysis .............................................................................................................. 264
22.2 Conclusions & Recommendations .................................................................................................. 265
23 Adjacent Properties ................................................................................................. 267
24 Other Relevant Data and Information ..................................................................... 268
25 Interpretation and Conclusions .............................................................................. 269
26 Recommendations ................................................................................................... 273
27 References................................................................................................................ 279
28 Glossary.................................................................................................................... 289
28.1 Mineral Resources .......................................................................................................................... 289
28.2 Mineral Reserves ............................................................................................................................ 289
28.3 Definition of Terms .......................................................................................................................... 290
28.4 Abbreviations .................................................................................................................................. 291
Disclaimer ...................................................................................................................... 293
Copyright ....................................................................................................................... 293
September 7, 2017
Feasibility Study - Technical Report - Boa Esperança Copper Project - Brazil Page xxvii
List of Tables
Table 1: Mineral Resource statement, Boa Esperança Copper Project, Pará State, Brazil, SRK Consultores do
Brasil LTDA., June 1, 2017 .................................................................................................................... v
Table 2: Mineral Reserve Statement for the Boa Esperança copper deposit, State of Para, Brazil, SRK
Consultores do Brasil Ltda. as of June 1, 2017.................................................................................... vi
Table 3: Proposed angles for each type of material ......................................................................................... vii
Table 4: Copper Prices - US$/t-Cu ...................................................................................................................xiii
Table 5: Logistic Costs - Container ................................................................................................................. xiv
Table 6: Logistic Costs - Bulk .......................................................................................................................... xiv
Table 7: Exchange Rates ................................................................................................................................ xiv
Table 8: Capital Costs Summary by Area ........................................................................................................ xv
Table 9: Project Operating Costs ..................................................................................................................... xv
Table 10: Economic Results ............................................................................................................................ xvi
Table 1.11: Proposed Budget for Recommended Work..................................................................................xvii
Table 4.1: Boa Esperança Exploration Permit.................................................................................................... 4
Table 6.1: Boa Esperança Historic resource statement for 2012. ...................................................................... 8
Table 6.2: Boa Esperança Historic resource statement for 2013. ...................................................................... 9
Table 7.1: Boa Esperança copper deposit rock types. ..................................................................................... 15
Table 7.2: Boa Esperança’s copper deposit ore types. .................................................................................... 16
Table 10.1: Summary of exploration drilling. .................................................................................................... 29
Table 11.1: Specifications of standard reference materials used by MCSA for the Boa Esperança copper
project. ................................................................................................................................................. 34
Table 12.1: Summary of analytical quality control data produced by MCSA on the Boa Esperança copper
project. ................................................................................................................................................. 35
Table 13.1: Bulk x differential flotation results .................................................................................................. 39
Table 13.2: Head grade analysis of the tested samples .................................................................................. 40
Table 13.3: locked cycle testes results for copper ........................................................................................... 41
Table 13.4: locked cycle tests results for pyrite (%) ......................................................................................... 41
Table 13.5: ICP results of the locked cycle variability flotation tests ................................................................ 42
Table 13.6: Results granite -1/2+1/8” ............................................................................................................... 45
Table 13.7: Results breccia -1/2+1/8” .............................................................................................................. 45
Table 13.8: Results – SGS Geosol................................................................................................................... 46
Table 13.9: Gekko results ................................................................................................................................. 47
Table 13.10: Bench jigging tests ...................................................................................................................... 50
Table 13.11: Size distribution and chemical analysis per size fraction ............................................................ 53
Table 13.12: Results of the continuous jigging tests ........................................................................................ 55
Table 13.13: Mass and metallurgical balances ................................................................................................ 56
Table 13.14: Experimental results for jigging ................................................................................................... 57
Table 13.15: Experimental results for jigging + flotation .................................................................................. 57
September 7, 2017
Feasibility Study - Technical Report - Boa Esperança Copper Project - Brazil Page xxviii
Table 14.1: Drillhole statistics. .......................................................................................................................... 59

Table 14.2: Statistics for copper and assay interval length. ............................................................................. 61
Table 14.3: Lithology codes. ............................................................................................................................. 61
Table 14.4: Mineralization codes. ..................................................................................................................... 62
Table 14.5: Statistics of assay data within the ore wireframes......................................................................... 66
Table 14.6: Statistics of composite data within the ore wireframes. ............................................................... 67
Table 14.7: Variogram parameters for copper (Sulfide Ore). ........................................................................... 77
Table 14.8: Variogram parameters for iron (Sulfide Ore). ................................................................................ 77
Table 14.9: Summary of estimation parameters. ............................................................................................. 80
Table 14.10: Comparison between composite and block Cu grades (Sulfide Ore). ........................................ 81
Table 14.11: Estimation summary for sulfide material. .................................................................................... 85
Table 14.12: Mineral Resource statement, Boa Esperança Copper Project, Pará State, Brazil, SRK
Consultores do Brasil LTDA., June 1, 2017 ........................................................................................ 86
Table 15.1: Mineral Reserve Estimate for the Boa Esperança copper deposit, State of Para, Brazil, SRK
Consultores do Brasil Ltda. as of June 1, 2017................................................................................... 90
Table 16.1: Mineral Resource Statement. ........................................................................................................ 91
Table 16.2: Flotation metallurgical recovery. .................................................................................................... 93
Table 16.3: Final pit geometry’s parameters. ................................................................................................... 94
Table 16-4: Strength parameters...................................................................................................................... 98
Table 16-5: Results of stability analyses ........................................................................................................ 106
Table 16-6: Proposed angles for each type of material.................................................................................. 106
Table 16.7: Pit optimization summary. * ......................................................................................................... 107
Table 16.8: Economic results of pit optimization. * ......................................................................................... 108
Table 16.9: Selected unscheduled final pit design (floated cone) .................................................................. 110
Table 16.10: Summary of the designed final pit. ............................................................................................ 111
Table 16.11: Summary of pushback’s tonnages and grades. ........................................................................ 115
Table 16.12: Mine Scheduling Summary........................................................................................................ 117
Table 16.13: Annual flow of materials. ........................................................................................................... 120
Table 16.14: Mine scheduling without stockpiles. .......................................................................................... 122
Table 16.15: Mine scheduling with only a low grade stockpile. ...................................................................... 123
Table 16.16: Material movement. ................................................................................................................... 125
Table 16.17: Mine equipment list and specifications. ..................................................................................... 128
Table 16.18: Mine fleet requirements. ............................................................................................................ 129
Table 16.19: Fleet working hours. .................................................................................................................. 130
Table 16.20: Labor costs (R$). ....................................................................................................................... 132
Table 16.21: Mine workforce. ......................................................................................................................... 133
Table 16.22: Annual Labor costs. ................................................................................................................... 133
Table 17.1: Major Equipment List for the Boa Esperança Concentrator ........................................................ 142
September 7, 2017
Feasibility Study - Technical Report - Boa Esperança Copper Project - Brazil Page xxix
Table 17.2: Plant Operating Costs – Summary .............................................................................................. 143

Table 17.3: Power Consumption Rates .......................................................................................................... 144
Table 17.4: Flotation Calculated Consumption Rates .................................................................................... 145
Table 17.5: Crushing & Screening Main Consumables & Wear Parts ........................................................... 146
Table 17.6: Mill Consumables ........................................................................................................................ 146
Table 17.7: Main equipment Spare parts ....................................................................................................... 147
Table 17.8: Plant Labor .................................................................................................................................. 148
Table 18.1: Summary table of the survey held in the foundation area of the B2 Dam ................................... 165
Table 18.2: Summary table of the surveys conducted inside the borrow area of the B2 Dam. ..................... 166
Table 18.3: Test campaign executed in the area of the B2 Dam foundation ................................................. 166
Table 18.4: Test campaign executed in the borrow area of the B2 Dam ....................................................... 167
Table 18.5: Truck requirements to have a continuous operation. .................................................................. 175
Table 18.6: Capex of the Preferred Logistics Alternative ............................................................................... 182
Table 18.7: Opex of the Preferred Logistics Alternative ................................................................................. 182
Table 18.8: Europe freight basis..................................................................................................................... 183
Table 18.9: Asia freight basis. ........................................................................................................................ 183
Table 18.10: Main destinations and costs. ..................................................................................................... 184
Table 18.11: Capex of road investment.......................................................................................................... 184
Table 18.12: Bulk opex comparison. .............................................................................................................. 184
Table 18.13: Container opex comparison....................................................................................................... 185
Table 20.1: Hydrographic regions and sub-regions of the state of Pará (Source: SSMA, 2010)................... 196
Table 20.2: Summary of the environmental impacts and mitigation measures.............................................. 204
Table 20.3: Sampling points in the Boa Esperança project area ................................................................... 208
Table 20.4: Fresh water quality pattern (class 3) for select parameters, in accordance with CONAMA
Resolution #357 (2005) ..................................................................................................................... 211
Table 20.5: Results of static tests (Source: SRK, 2015) ................................................................................ 214
Table 21.1: Copper Prices - US$/t-Cu ............................................................................................................ 224
Table 21.2: Logistic Costs - Container ........................................................................................................... 224
Table 21.3: Logistic Costs - Bulk .................................................................................................................... 224
Table 21.4: Exchange Rates .......................................................................................................................... 225
Table 21.5: Project-Wide Common Cost Factors ........................................................................................... 225
Table 21.6: Capital Costs Summary per Area ................................................................................................ 227
Table 21.7: Capital Costs Summary per Type ............................................................................................... 227
Table 21.8: Pre-production costs per Area ..................................................................................................... 234
Table 21.9: Civil Works Pre-production Costs ................................................................................................ 234
Table 21.10: General Infrastructure Cost ....................................................................................................... 235
Table 21.11: Access Road Infrastructure Cost ............................................................................................... 235
Table 21.12: Unitary Equipment Costs ........................................................................................................... 235
September 7, 2017
Feasibility Study - Technical Report - Boa Esperança Copper Project - Brazil Page xxx
Table 21.13: New Equipment Purchases and Replacements ........................................................................ 236

Table 21.14: Mine Costs per Area .................................................................................................................. 236
Table 21.15: Plant Costs per Area ................................................................................................................. 236
Table 21.16: Plant Costs per Type ................................................................................................................. 237
Table 21.17: Power & Automation Costs per Area......................................................................................... 237
Table 21.18: Power & Automation Costs per Type ........................................................................................ 237
Table 21.19: Utilities System Costs per Area ................................................................................................. 238
Table 21.20: Utilities System Costs per Type ................................................................................................ 238
Table 21.21: Administration & Support Costs per Area.................................................................................. 238
Table 21.22: Administration & Support Costs per Type ................................................................................. 239
Table 21.23: Tailings Storage Facilities Costs per Area ................................................................................ 239
Table 21.24: Tailings Storage Facilities Costs per Type ................................................................................ 239
Table 21.25: Water Pond Costs ..................................................................................................................... 239
Table 21.26: Closure Costs ............................................................................................................................ 242
Table 21.27: Salvage ...................................................................................................................................... 242
Table 21.28: Criteria Used in Contingency Estimations ................................................................................. 243
Table 21.29: Project Operating Costs per Area ............................................................................................. 243
Table 21.30: Project Operating Costs by Element ......................................................................................... 244
Table 21.31: Mine Operating Costs ................................................................................................................ 244
Table 21.32: Equipment Consumption Rates ................................................................................................. 244
Table 21.33: Main Equipment and Ancillary Equipment - Annual and LoM Consumption - Diesel ............... 245
Table 21.34: Diesel - Annual and Life of Mine (LoM) Costs ........................................................................... 246
Table 21.35: Lube - Annual and Life of Mine (LoM) Costs ............................................................................. 246
Table 21.36: Explosive and Accessories - Unit Costs .................................................................................... 246
Table 21.37: Explosive and Accessories - Annual and Life of Mine (LoM) Costs .......................................... 247
Table 21.38: Drilling Materials - Annual and Life of Mine (LoM) Costs .......................................................... 247
Table 21.39: Tires - Annual and Life of Mine (LoM) Costs ............................................................................. 247
Table 21.40: Spare Parts and Other Wear Parts - Annual and Life of Mine (LoM) Costs ............................. 248
Table 21.41: Spare Parts and Other Wear Parts - Annual and Life of Mine (LoM) Costs ............................. 249
Table 21.42: Mine workforce per year and During the Life of Mine ............................................................... 250
Table 21.43: Mine Labor - Annual and Life of Mine (LoM) Costs ................................................................... 251
Table 21.44: Plant Operating Costs by Area .................................................................................................. 252
Table 21.45: Plant Operating Costs by Element ............................................................................................ 252
Table 21.46: Plant Electric Power Consumption ............................................................................................ 253
Table 21.47: Plant Electric Power - Annual and Life of mine (LoM) Cost ...................................................... 253
Table 21.48: Reagents Calculated Consumption Rates ................................................................................ 254
Table 21.49: Annual and Life of mine (LoM) Cost - Reagents ....................................................................... 254
Table 21.50: Grinding Bodies - Annual Consumption ................................................................................... 254
September 7, 2017
Feasibility Study - Technical Report - Boa Esperança Copper Project - Brazil Page xxxi
Table 21.51: Grinding Bodies - Annual and Life of Mine (LoM) Costs ........................................................... 255
Table 21.52: Annual Consumption - Linings - Crushing and Grinding ........................................................... 255
Table 21.53: Lining - Annual and Life of Mine (LoM) Costs ........................................................................... 256
Table 21.54: Screens and Filter Linings - Annual and Life of Mine (LoM) Costs ........................................... 256
Table 21.55: Spare Parts - Annual and Life of Mine (LoM) Costs .................................................................. 256
Table 21.56: Plant Administrative Labor......................................................................................................... 257
Table 21.57: Project G&A Costs ..................................................................................................................... 258
Table 21.58: Labor Costs - G&A .................................................................................................................... 259
Table 22.1: Model Parameters ....................................................................................................................... 261
Table 22.2: Economic Results ........................................................................................................................ 262
Table 22.3: Annual Cash flow and Production Forecast ................................................................................ 263
Table 22.4: Project Sensitivity to Copper Price .............................................................................................. 264
Table 22.5: Project Sensitivity to Initial Capital Costs .................................................................................... 264
Table 22.6: Project Sensitivity to Operating Costs ......................................................................................... 264
Table 25.1: Mineral Reserve Statement for the Boa Esperança copper deposit, State of Para, Brazil, SRK
Consultores do Brasil Ltda. as of June 1, 2017................................................................................. 269
Table 26.1: Proposed Budget for Recommended Work................................................................................. 274
Table 28.1: Definition of Terms. ..................................................................................................................... 290
Table 28.2: Abbreviations ............................................................................................................................... 291
September 7, 2017
Feasibility Study - Technical Report - Boa Esperança Copper Project - Brazil Page xxxii
List of Figures
Figure 4-1: Location of the Boa Esperança Project (Ero Copper, 2017)............................................................ 3
Figure 7-1: Geological map of Carajás Mineral Province (Source: Correia Junior, F. C., 2000). .................... 12
Figure 7-2: General overview of Boa Esperança hill (Looking NW). ................................................................ 13
Figure 7-3: Detailed geology of the Boa Esperança deposit (Source: modified by SRK, 2012). ..................... 14
Figure 7-4: Boa Esperança’s granite outcrop cut by anastomosed breccia veins (Source: SRK, 2012). ........ 17
Figure 7-5: Vertical section 10,000 (looking North). ......................................................................................... 18
Figure 7-6: Plan view at 135 m. ........................................................................................................................ 18
Figure 7-7: A - Chalcopyrite-pyrite ore from drillhole BSPD-162 (99.50 to 103.20 m); B - Pyrite-chalcopyrite ore
in quartz magnetitic breccia from drillhole BSPD-162 (109.00 m). ..................................................... 22
Figure 7-8: A – Boa Esperança granite with venules of pyrite and chalcopyrite from drillhole BSPD-136 (191.05
m); B - Chalcopyrite in matrix of quartz magnetitic breccia from drillhole BSPD-162. ........................ 22
Figure 7-9: Top of mineralized zone, leached material composed of quartz magnetitic breccia. .................... 23
Figure 7-10: Detail of the quartz magnetitic breccia leached at top. ................................................................ 23
Figure 10-1: Exploration drilling map. ............................................................................................................... 31
Figure 13-1: Conventional Processing ............................................................................................................. 37
Figure 13-2: Processing with pre-concentration ............................................................................................... 38
Figure 13-3: Schematic of occurrence of the sulphide minerals ...................................................................... 43
Figure 13-4: Breccia ......................................................................................................................................... 43
Figure 13-5: Granite.......................................................................................................................................... 44
Figure 13-6: Trays jig ........................................................................................................................................ 49
Figure 13-7: Overall recovery x ROM grade (Cu%) ......................................................................................... 58
Figure 14-1: Drillhole location map. .................................................................................................................. 60
Figure 14-2: Vertical section 10000. ................................................................................................................. 63
Figure 14-3: Copper histogram, cumulative frequency and probability plot from assay data. Data inside ore
wireframes. .......................................................................................................................................... 64
Figure 14-4: Copper histogram and cumulative frequency graph from assays data. Data inside the ore sulfide
wireframes. .......................................................................................................................................... 65
Figure 14-5: Length cumulative frequency graph from assays data. Data inside ore wireframes. .................. 67
Figure 14-6: Copper probability plot from composites data. Data inside sulfide and secondary ore (Oxide)
wireframes. .......................................................................................................................................... 68
Figure 14-7: Contact analysis between sulfide ore data and sulfide waste data. ............................................ 69
Figure 14-8: Comparison of SG results – MCSA vs. Intertek. .......................................................................... 70
Figure 14-9: Scatter plots of SG vs. Cu+Fe. .................................................................................................... 71
Figure 14-10: Down the hole variogram for copper (Sulfide Ore). ................................................................... 73
Figure 14-11: Down the hole variogram for iron (Sulfide Ore). ........................................................................ 74
Figure 14-12: Directional variogram for copper (Sulfide Ore). ......................................................................... 75
Figure 14-13: Directional variogram for iron (Sulfide Ore). .............................................................................. 76
Figure 14-14: Copper search ellipses (Sulfide Ore). ........................................................................................ 78
September 7, 2017
Feasibility Study - Technical Report - Boa Esperança Copper Project - Brazil Page xxxiii
Figure 14-15: Block model origin and dimensions. .......................................................................................... 79

Figure 14-16: Wireframes with block model outline in section view. ................................................................ 79
Figure 14-17: Swath plots between OK and NN (Sulfide Ore). ........................................................................ 82
Figure 14-18: Vertical section 9950. ................................................................................................................. 83
Figure 14-19: Vertical section 10100. ............................................................................................................... 84
Figure 14-20: Grade Tonnage - Sulfide Measured and Indicated. ................................................................... 87
Figure 14-21: Grade Tonnage - Sulfide Inferred. ............................................................................................. 87
Figure 14-22: Grade Tonnage - Secondary Ore Inferred (Oxide). ................................................................... 88
Figure 16-1: Boa Esperança’s property and tenement boundaries. ................................................................. 92
Figure 16-2: Concentration Process. ................................................................................................................ 93
Figure 16-3: Plane view pit showing the analyzed sections ............................................................................. 95
Figure 16-4: Section A-A .................................................................................................................................. 96
Figure 16-5: Section B-B .................................................................................................................................. 96
Figure 16-6: Fresh rock bench geometry ......................................................................................................... 97
Figure 16-7: Saprolite bench geometry ............................................................................................................ 97
Figure 16-8: Study 1 ......................................................................................................................................... 99
Figure 16-9: Study 2 ....................................................................................................................................... 100
Figure 16-10: Study 3 ..................................................................................................................................... 100
Figure 16-11: Study 4 ..................................................................................................................................... 101
Figure 16-12: Study 5 ..................................................................................................................................... 101
Figure 16-13: Study 6 ..................................................................................................................................... 102
Figure 16-14: Study 7 ..................................................................................................................................... 102
Figure 16-15: Study 8 ..................................................................................................................................... 103
Figure 16-16: Study 9 ..................................................................................................................................... 103
Figure 16-17: Study 10 ................................................................................................................................... 104
Figure 16-18: Study 11 ................................................................................................................................... 104
Figure 16-19: Study 12 ................................................................................................................................... 105
Figure 16-20: Study 13 ................................................................................................................................... 105
Figure 16-21: Pit optimization results. ............................................................................................................ 109
Figure 16-22: Designed final pit in plane and vertical sections. ..................................................................... 112
Figure 16-23: Material flow. ............................................................................................................................ 114
Figure 16-24: Pushback planview. ................................................................................................................. 116
Figure 16-25: Mine output. ............................................................................................................................. 118
Figure 16-26: Stockpile inventories. ............................................................................................................... 118
Figure 16-27: Plant feed details...................................................................................................................... 119
Figure 16-28: Ore mined vs. plant feed. ......................................................................................................... 119
Figure 16-29: Comparison between different ore stockpiling scenarios. ....................................................... 121
Figure 16-30: Bench drainage system............................................................................................................ 126
September 7, 2017
Feasibility Study - Technical Report - Boa Esperança Copper Project - Brazil Page xxxiv
Figure 16-31: General layout of the project. ................................................................................................... 134

Figure 17-1: Simplified Process Flowsheet .................................................................................................... 150
Figure 18-1: Typical Section of the Water Pond. ............................................................................................ 167
Figure 18-2: Potentiometric map referred to June 2011 in the region of Boa Esperança Project and its
surroundings ...................................................................................................................................... 169
Figure 18-3: Road Route from Project to Port ................................................................................................ 170
Figure 18-4: Routing of Site Access Road P5 ................................................................................................ 171
Figure 18-5: Vila do Conde Port ..................................................................................................................... 172
Figure 18-6: Design parameters for an annual volume of 100,000 WMT/y. .................................................. 174
Figure 18-7: B-trucks with 9 and 7 axles. ....................................................................................................... 174
Figure 18-8: Vila do Conde Port. ................................................................................................................. 176
Figure 18-9: Itaqui berths................................................................................................................................ 178
Figure 18-10: Flowchart of the Preferred Logistics Alternative. ..................................................................... 181
Figure 20-1: Soil sampling points at the Boa Esperança Project area (Source: KEYSTONE, 2008) ............ 194
Figure 20-2: Local and regional drainage network (Source: MDGEO, 2011) ................................................ 195
Figure 20-3: Map showing the locations of inventoried collection points (Source: MDGEO, 2011)............... 197
Figure 20-4: Deforested area – 2000 (Source: Keystone, 2008) ................................................................... 199
Figure 20-5: Deforested area – 2008 (Source: Keystone, 2008) ................................................................... 200
Figure 20-6: Humid Tropical Forest, seen at the peak and on the slopes of Boa Esperança Mountain (Source:
MDGEO, 2011). ................................................................................................................................. 200
Figure 20-7: Environmental delimitation - Physical / Biological ...................................................................... 201
Figure 20-8: Location of water sampling points at Boa Esperança Project area ........................................... 210
Figure 20-9: Comparison between sulfide content (%) in the sample and Neutralization Potential Rate (NPR)
(Source: SRK, 2015).......................................................................................................................... 214
Figure 20-10: Simultaneous analyses of the neutralization potential rate (NPR) of samples and net acid
generation (NAGpH) (Source: SRK, 2015) ....................................................................................... 215
Figure 20-11: NAG tests results: Samples do not have free acidity due sulfite oxidation (Source: SRK,
2015) .................................................................................................................................................. 215
Figure 20-12: NAG Simultaneous analysis of the potential neutralization of samples (NPR) and acidity
production of liquid potential (NAPP) (Source: SRK, 2015) .............................................................. 216
Figure 20-13: Vegetation types found in project area (Source: MCSA, 2014) ............................................... 217
Figure 22-1: Sensitivity Analysis - IRR ........................................................................................................... 265
Figure 22-2: Sensitivity Analysis: NPV ........................................................................................................... 265
Appendix A - Analytical Quality Control Data and Relative Precision Charts ................................................ 295
September 7, 2017
Feasibility Study - Technical Report - Boa Esperança Copper Project - Brazil Page 1
2 Introduction
SRK Consultores do Brasil LTDA. (SRK) was commissioned by Ero Copper Corp (Ero) to prepare a
National Instrument 43-101 (NI 43-101) compliant Feasibility Study (FS) for the Boa Esperança
Deposit (Boa Esperança or the Project) as part of the Boa Esperança Project located in Pará, Brazil.
The Project was acquired by Mineraҫão Caraíba S.A. (MCSA) from Corporacion Nacional Del Cobre
(Codelco) in 2007 and is now 100% owned by MCSA. In December 2016, Ero. acquired approximately
85.0% interest in MCSA. In June 2017, Ero acquired an additional 14.5% by subscribing for shares
from treasury for a total interest in MCSA of approximately 99.5%.
This Technical Report is an update of a prior 2015 report prepared by SRK. The original 2015 report
has been updated based on work performed throughout various studies developed for the Project by
third-party technical and engineering firms throughout the course of the Project’s ownership under
MCSA. SRK has reviewed the contents and, where relevant, has relied upon the work, conclusions
and recommendations therein. There has been no new material scientific or technical information
about the property since the publication of these reports. It is the opinion of the authors of this Technical
Report that the information contained therein may be relied on as current for the purposes of NI 43-
101. Please refer to Chapter 3 – Reliance on Other Experts for additional information on the various
studies relied upon for the current technical report.
2.1 QP Personal Inspections

The authors of this report Rubens Mondonҫa and Carlos Barbosa personally inspected the Project in
August of 2015. Giorgio di Tomi, responsible for the processing and metallurgical sections of this
Technical report, visited the Project in March of 2015.
The authors have confirmed there is no new material scientific or technical information that would
necessitate the need for an updated personal inspection.
September 7, 2017
3 Reliance on Other Experts

The author’s opinion contained herein is based on information provided to SRK by MCSA throughout
the course of the investigations over the life of the Project. SRK has additionally relied upon the work
of other consultants in the project areas in support of this Technical Report. The sources of information
include data and reports supplied by MCSA personnel and third-party reports detailed in Chapter 27 -
References.
The authors used their experience to determine if the information from previous reports was suitable
for inclusion in this technical report and adjusted information that required amending. This report
includes technical information, which required subsequent calculations to derive subtotals, totals and
weighted averages. Such calculations inherently involve a degree of rounding and consequently
introduce a margin of error. Where these occurred, the authors do not consider them to be material.
3.1 Sources of Information and Extent of Reliance

This Technical Report is based, in part, on input from various studies prepared by reputable
engineering firms developed for the Project throughout the course of the Project’s ownership by MCSA.
Where such third-party reports have been referenced, SRK has reviewed and verified the technical
merit of the conclusions, results and recommendations for use in the current Technical Report.
Taxation and other benefits used in the economic analysis have been developed for MCSA by Tyno
Consultoria Tributária e Empresarial Ltda (Bahia, Brazil), the results of which SRK has relied on for
use.
A list of third-party technical reports has been provided in Chapter 27 – References.
3.2 Effective Date

The effective date of this report is June 1, 2017.
3.3 Units of Measure

The metric system has been used throughout this report. Tonnes are metric of 1,000 kg, or 2,204.6 lb.
All currency is in Brazilian Reais (R$) unless otherwise stated.
September 7, 2017
4 Property Description and Location

4.1 Property Description and Location
The Boa Esperança copper deposit is located in the municipality of Tucumã, Pará State, Brazil. The
site is located approximately 40 km to the southwest of the town. Tucumã can be accessed by state
highway PA-279, which connects the town of Xinguara to the town of São Felix do Xingu, a stretch of
road that runs for approximately 160 km. The junction of PA-279 with federal highway BR-155 is in
Xinguara. The latter is the main highway leading to the city of Marabá, situated around 220 km north
of Xinguara.
Figure 4-1 shows the location of the Project.
Figure 4-1: Location of the Boa Esperança Project (Ero Copper, 2017).
4.2 Mineral Titles

Mining legislation as it relates to the mineral title process in Brazil has been under review for several
years with the stated goal of introducing new legislation through Congress. Subsequent to the Effective
Date of this report such legislation was enacted. The authors of the Report do not view such a change
in legislation as a material risk to the properties controlled by MCSA, nor those that are currently under
renewal or transition from exploration to mining licenses. Table 4.1 presents the Exploration Permit of
MCSA related to the Boa Esperança Project.
September 7, 2017
Table 4.1: Boa Esperança Exploration Permit

Final
Concession Area (ha) Permit Start Date End Date Renewal Exploration
Report Filed
855815/1996 4,033.81 19/07/1996 13/07/2000 13/07/2003 12/04/2005 10/04/2008
5, 2010; and
• All criteria to obtain the mining rights have been fulfilled and the Company is awaiting final
approval of the change status to a full Mining Concession after the issuance of the Installation
License, currently under review by the Pará State environmental agency.
After the Final Exploration Report is approved by the DNPM, the holder has one year to present an
Economic Exploitation Plan (PAE or Plano de Aproveitamento Econômico). The PAE may be equated
with a Feasibility Study, which was submitted to the DNPM on May 5, 2010. Only after the approval of
the PAE can construction activities commence under an Installation License, currently under review
by the Pará State environmental agency, in conjunction with the Project.
During the validity of an Exploration License, the holder must pay an annual tax per hectare. The
amount is R$2.02/ha for the first three years, and R$3.06/ha once the Exploration License has been
renewed. Aside from additional corporate taxes, mining companies also pay a tax on the exploitation
of minerals called the ‘Financial Compensation for the Exploitation of Mineral Resources (CFEM). This
royalty is levied on the sale of raw or improved minerals. The rate is 2% for copper at the time of the
Effective Date.
The prior landowners of the project area were financially compensated. MCSA is either the beneficial
owner or has the right to the required surface rights for the envisioned operations.
4.2.1 Nature and Extent of Issuer’s Interest

The estimated Mineral Resources and Mineral Reserves for the project are entirely within the surface
rights (or granted surface rights) and current Exploration Permit area held by MCSA. The company
has filed an application to convert the Exploration Permit area to a Mining Concession and is awaiting
approval of the Installation License, currently under review by the Pará State environmental agency
and final approval by the DNPM. All criteria to recieve the Installation License and convert the
Exploration Permit to a Mining Concession have been filed with the government agencies.
September 7, 2017
5 Accessibility, Climate, Local Resources,

Infrastructure and Physiography
5.1 Topography, Elevation and Vegetation
The copper deposit of Boa Esperança is located in the southeast of Pará State, Brazil, within the
municipality of Tucumã, which is bounded by the municipalities of Ourilândia do Norte, São Félix do
Xingu, Parauapebas and Água Azul do Norte. It is a part of the São Félix do Xingu region. This region
is characterized by the existence of large mineral deposits including the nickel deposits of Onça Puma
and Vermelho. Further to the northeast are the Sossego and 118 copper deposits and the mineral
province of Carajás, which contains significant iron ore deposits.
The Boa Esperança deposit occurs in an isolated hill which is elongated in NNE direction and located
38 km SW from Tucumã’s center. The topography is supported mainly by breccias composed of quartz
and magnetite, which cut the neo-Archean biotite-granite, the ore host which intrudes the meso-
Archean Rio Maria granodiorite (2.85 Ga). The elevation of the future mine buildings is about 250 masl
and the elevation of Boa Esperança hill is about 450 masl.
The original vegetation is a tropical rainforest. However, the original vegetation in the Project area has
undergone intense anthropogenic alteration primarily due to deforestation from agricultural expansion
and timber extraction.
5.2 Climate and Length of Operating Season

Pará State, Brazil. The climate is ‘humid tropical’ according to Köppen’s climate classification system,
with rainy summers, dry winters and very intense rainfall between January and April (Keystone, 2008).
The climatic subtypes in the Xingu region and surrounding municipalities are classified as AM (Am3
and Am4) and AW (Aw3, Aw4 and Aw5). The AM subtype represents tropical monsoon climates, with
a moderate dry season during which the monthly average precipitation is less than 600mm. The AW
subtype is characterized by a dry winter and monthly average rainfall of about 500mm.
Therefore, there are several climatic zones with different levels of rainfall within the region which can
be grouped as follows:
• Am3 - characterized by annual average rainfall ranging from 2,000 to 2,500mm; and
• Am4 - characterized by annual average rainfall between 1,500 and 2,000mm.
Climate subtypes Aw3 and Aw4 present a similar behavior to the Am3 and Am4 subtypes. However,
Aw5 (which is found at the eastern end of the region) presents an annual average rainfall of between
1,000 and 1,500mm.
The rainfall patterns can be assessed by five rainfall stations located around the city of Tucumã: Boa
Esperança Station, Tucuma Project, São Félix do Xingu, Onça Puma mine and Onça Puma Site. The
nearest station is the Tucuma Project, located 12 km away, and the farthest is Sao Felix do Xingu,
approximately 63 km from the project area.
September 7, 2017
The rainy season between the months of October and April represents, on average, 83% of annual
rainfall. The dry period is therefore characterized by a dry season between May and September, of
which the driest month is July, which has an average rainfall of 17.2 mm.
The presented subtypes belong to the ‘tropical rainy’ climate and they are characterized by an annual
average temperature above 27°C and differ from each other by the annual and monthly average
rainfall. The climate in the São Felix do Xingu region and its surrounding areas is classified, according
to Köppen, as ‘tropical humid’. Tropical humid climate is characterized by a rainy summer and dry
winter, with intense rainfall occurring from January to April. According to meteorological parameters,
the wet season extends from December to May, while the dry season occurs from June to October.
The average rainfall is about 1,754.9mm/year. During the wet season there are about 20 rainy days
per month and in the dry season there are approximately 3.
The area has a humid climate, with little or no water deficit. The dry season is shorter than the wet
season. The region has a warm climate, mainly at lower elevations and at low latitudes. The availability
of heat and water mass favor high evaporation levels and result in a humid climate in the region.
The lowest average air temperatures occur from February to April, as one would expect of a wet
season with high nebulosity. Higher average air temperatures occur in September and October, which
indicates the start of the transition period from the dry season to the wet season. From June to October
the maximum air temperature continuously rises, decreasing in November due the increase of
nebulosity and the beginning of the rainy season.
Temperatures are generally elevated, where annual average values vary from 24.9º to 26.7ºC with low
thermal amplitudes (Government of the State of Pará, 2011). Humidity is high, with values above 70%
percent throughout the year (Keystone, 2008). The annual average is 82%, with February being the
most humid month and August the least. Winds predominantly arrive from the northwest, except
between May and July, when they come from the southwest. Annual atmospheric pressure is about
900.4 mbar.
In general, the southern region of Pará is dominated by trade winds from the southeast, which can
also assume an easterly direction. These winds come from the northeast in the months with low levels
of rainfall and are regular and constant with low speeds (breezes).
5.3 Access to Property

The area of the Project is located in the municipality of Tucumã, in the southeast portion of the Pará
State. The terrestrial access is through the city of Marabá using the following route:
• Leave Marabá using the paved road BR-155 southeast bound until Xinguara is reached;
• In Xinguara change to the paved road PA-279 and drive through Água Azul do Norte,
Ourilândia do Norte and Tucumã;
• From Tucumã continue on the same paved road another 25 km until the P5 village is reached;
• A dirt road, which is usable throughout the year, is used from P5 for another 16 km towards
southeast until Boa Esperança.
September 7, 2017
Although no airfield exists near the Project area, flights are available to Ourilândia do Norte, 9.7 km
from Tucumã. This is a single-engine airplane flight from Belém, capital of Pará State, with a stop in
Marabá.
5.4 Surface Rights

The Mineral Resources and Mineral Reserves disclosed in this report are completely contained within
the Exploration Licence held by MCSA. MCSA is either the beneficial owner or has the right to the
required surface rights for the envisioned operations
September 7, 2017
6 History
The area encompassing the Boa Esperança copper deposit previously belonged to the Chilean
company Corporación Nacional del Cobre (Codelco), the largest copper producer in the world.
Codelco conducted an exploration program from 2003 to 2006 at Boa Esperança. The resulting copper
deposit defined by this exploration work was considered too small to justify Codelco’s continued
interest. In the second half of 2007, Codelco, through its subsidiary in Brazil, initiated a competitive
process to sell the Boa Esperança copper and cobalt mineral deposit rights. MCSA acquired the
contract and became the legal owner of the mineral rights to the Boa Esperança copper deposit.
After the purchase, MCSA began several studies of the Boa Esperança deposit with the objective of
preparing a technical economic FS (Feasibility Study) for the Project, in order to evaluate the industrial
production of copper concentrate from copper mineralization, with associated cobalt, based on
minerals obtained from the Boa Esperança copper deposit.
With this objective, MCSA has initiated several engineering studies and other support services, by
consulting engineering firms, and including an in-fill drilling campaign.
SRK completed the first Feasibility Study in November of 2012 (SRK, 2012). The drilling conducted
during 2011/2012 was not used in this report; the 2011/2012 drilling campaign corresponds to a total
of 43 core boreholes totaling 14,147.15 m. Table 6.1 represents the 2012 resource statement.
Table 6.1: Boa Esperança Historic resource statement for 2012.

Contained Cu
Domain Category Quantity (Mt) Cu %
(tonnes)
Measured 8.03 0.95 76,700
Indicated 42.89 0.77 329,600
Sulfide
Inferred 7.68 0.78 60,100
Oxide Inferred 4.15 0.91 37,900
Source: SRK, 2012
Effective Date: December 31, 2011
(2) Resources are stated at a CoG of 0.185% Cu and are contained within a pit optimization shell.
A qualified person has not done sufficient work to classify the historical estimate as current mineral
resources or mineral reserves. Ero is not treating the historic Mineral Resources prepared in 2012 and
presented in Table 5.1 as current Mineral Resources.
Subsequent to the completion of the 2012 study, SRK updated the Mineral Resource estimate in
August 2013 to include the 2011/2012 core boreholes. Table 6.2 represents the 2013 resource
statement.
September 7, 2017
Table 6.2: Boa Esperança Historic resource statement for 2013.

Contained Cu
Domain Category Quantity (Mt) Cu %
(tonnes)
Measured 10.6 0.95 101,300
Indicated 55.9 0.68 380,400
Sulfide
Inferred 5.5 0.72 38,900
Oxide Inferred 3.6 0.92 33,200
Source: SRK, 2013
(2) Resources are stated at a CoG of 0.185% Cu and are contained within a pit optimization shell.
[In 2013, a new drilling campaign was carried out; 17 new core boreholes were drilled, totaling 5,371.40
m drilled. In addition, MCSA updated many of its engineering studies, primarily those regarding mineral
processing. This allowed for an update of the new Mineral Resource and, thus, for an update of many
of the technical aspects of the Boa Esperança project.
A qualified person has not done sufficient work to classify the historical estimate as current mineral
resources or mineral reserves. Ero is not treating the historic Mineral Resources prepared in 2013 and
presented in Table 5.2 as current Mineral Resources.
A detailed discussion of the work performed to upgrade the historical resource estimates to current
Mineral Resources and current Mineral Reserves are presented in Chapter 14 and Chapter 15,
respectively.
September 7, 2017
7 Geological Setting and Mineralization

The Carajás Mineral Province, where the Boa Esperança copper deposit is located, is on the east side
of the Amazon Craton and is considered one of the most important mineral provinces in Brazil. It is a
region of high economic importance, as it hosts large high-grade Fe deposits, as well as significant
Cu-Au deposits, such as Salobo, Sossego, 118, Cristalino and Igarapé Bahia-Alemão. Deposits of Mn,
Ni, Cr, Al and Zn have also been identified in the province. Its copper and gold resources are greater
than 2,500 Mt, at 1% Cu and 0.5 g/t Au.
7.1 Regional Geology

The Carajás Mineral Province encompasses two distinct tectonic domains, both of these Archean in
age (Figure 7-1). The South Block, which is the older of the two (3.0 to 2.86 Ga) and is where the Boa
Esperança deposit is located, is called the Rio Maria Block and contains a typical granite-greenstone
belt terrain. The North Block, which is the younger domain (2.8 to 2.5 Ga), is called Carajás and is
composed of volcano-sedimentary rocks and granitoids, which host the large Fe, Cu-Au, Mn, Ni and
Zn deposits in the province. These two blocks are considered to be products of the juxtaposition of
volcanic island arcs and plutonic-like Andes environments, associated with an intra-continental mantle
plume.
The North Block of Serra dos Carajás consists of a WNW-trending belt, composed of basaltic
andesites and felsic volcanic rocks (2.7 Ga). As part of the Itacaiúnas Supergroup, the North Block
has banded iron formations (jaspilites) intercalated with volcano-clastic and clastic sedimentary rocks,
whose degree of metamorphism ranges up to amphibolite facies. These units are discordantly covered
by younger (2.6 Ga) clastic, shallow marine and fluvial deposits of the Aguas Claras Formation. The
basement is dominated by granitic, tonalitic and trondhjemitic gneisses, amphibolites and quartzites
from the Xingu Complex (2.8 Ga).
Older granulitic cores, such as the Pium Complex, are elongated following an E-W direction and
located in the south of Serra dos Carajás. These occupy limited areas and are composed of mafic and
felsic granulites, enderbites and charnockites, which date from around 3.0 Ga. They are considered
lower crustal fragments, placed along regional shear zones, defined by the juxtaposition of the two
blocks.
The greenstone belt sequences from the Rio Maria Block, which are greenschist facies, are composed
of basaltic flows, komatiitic at their base, and include interlayers of banded iron formations and cherts.
The upper part of the sequences grade into rhyodacites with psamites and pelites at the top. These
sequences constitute narrow and distorted strips, which are distributed over the gneissic basement of
the Xingu Complex and among the Archean and paleo-Proterozoic granitoids, which are widespread
in the region.
The Mesoarchean-aged granitoids (2.95 to 2.87 Ga) are represented by the Arco Verde, Parazônia
and Caracol tonalities; the Mogno and Agua Fria trondhjemites; the Guarantã, Xinguara, and Mata
Surrão granites; and the Rio Maria Granodiorite. The latter surrounds the Boa Esperança Granite,
which hosts the Boa Esperança copper deposit.
The Rio Maria granodiorite, which runs through a ductile shear zone, is limited on the east and west,
by the Xingu Complex, São Felix Group and Plaque Granite. Locally, it is covered by volcanic rocks of
September 7, 2017
the Sobreiro formation. It consists of leucocratic to mesocratic granitic rocks, which are equigranular
to porphyritic and composed of plagioclase, microcline, quartz, biotite, hornblende, epidote, chlorite,
sericite, allanite, apatite and zircon. The rocks were affected by structural tectonic processes, resulting
in the formation of cataclasites. The Rio Maria granodiorite was emplaced prior to the formation of the
Itacaiúnas shear zone. Copper mineralization, which is associated with fractures of feldspar, mica and
chlorite in fractures, is found north of the city of Ourilândia.
Another set of diverse Neoarchean-aged intrusives (2.7 Ga) includes granite, both alkaline and meta-
alluminous, which occur at Serra dos Carajás. Examples of these include the Estrela Granitic Complex,
Planalto Granite and Serra do Rabo Granite, in addition to those occurring at Rio Maria Block, such
as the Plaque Suite. They suggest the existence of an important regional strain episode concomitant
with the basaltic andesites in the Serra dos Carajás.
The differences between the two Archean domains, the Carajás (North Block) and the Rio Maria
(South Block), are also reflected in their metallogeny. The younger Carajás domain hosts the most
important mineral deposits currently known in the Archean Craton (Fe, Cu-Au, Mn, Ni, Al). The older
Rio Maria domain hosts known as Cu deposits, namely those of Tucumã (Boa Esperança) and the
Cuca region, as well as Au and W deposits.
7.2 Local Geology

The Boa Esperança copper deposit occurs within an isolated hill, which is elongated in a NNE direction
(Figure 7-2) and located 38 km SW following a straight line from the town of Tucumã. The topographic
high is supported mainly by breccias composed of quartz and magnetite, which cut the Neoarchean
biotite-granite (2.78 Ga), the host of the copper mineralization. The Neoarchean biotite granite intrudes
into the Mesoarchean Rio Maria granodiorite (2.85 Ga). Figure 7-3 shows the detailed geology of the
area and the Boa Esperança copper deposit.
Mineralization consists of a series of brecciated zones, which are aligned N60°-70°E and incline in a
SE direction (60°-70°SE). However, another alignment of about N40°E was observed in the field and
coincides with the elongation of the Boa Esperança hill.
The rock types that make up the Boa Esperança copper deposit were defined and described in the
geological and geotechnical work carried out and are shown in Table 7.1. The mineralization types
that occur in the deposit, and which serve as the basis for all geological, geotechnical and geostatistical
discussions, are described in Table 7.2.
September 7, 2017
Boa Esperança
Project
Figure 7-1: Geological map of Carajás Mineral Province (Source: Correia Junior, F. C., 2000).
September 7, 2017
Figure 7-2: General overview of Boa Esperança hill (Looking NW).
September 7, 2017
Figure 7-3: Detailed geology of the Boa Esperança deposit (Source: modified by SRK, 2012).
September 7, 2017
Table 7.1: Boa Esperança copper deposit rock types.

Group Code Rock Code Description
SDAT SDAT No data. No sample recovered.
DIQ Dykes of uncertain composition.
DIQ Dacitic dykes. Veins associated with the most recent structure, N75W
DAC
direction.
Microdiorites. Veins associated with the most recent structure, N75W
MDI MDI
direction.
Hydrothermal breccia, with a matrix composed of Magnetite (Mag), Biotite
BXX (Bio) and Chalcopyrite (Cpy). Fragments of Quartz (Qtz), Granite and Pyrite
(Py).
BXX BXQ Breccia with predominant fragments of Qtz, Mag matrix, Bio, Cpy, Py.
BXG Breccia with predominant fragments of Granite, Mag matrix, Bio, Cpy, Py.
Massive sulfide veins, with a greater composition of Py and smaller quantities
VET
of Cpy, Mag.
GRA Granite, host rock
Brecciated Granite. Incipient brecciation or intervals of Granite alternating with
GRB
smaller intervals of breccia, not expressive enough for modeling.
GRG Coarse Granite. Porphyritic Granite, appears in the north of BSP.
PGR Granitic porphyry. Point distribution rock. Development of abundant Feldspar.
Tonnealite. Possibly constituted of host rock not affected by potassic
GRA TON
alteration.
TOF Fine Tonnealite. Variation of TON unit (?)
TOB Brecciated Tonnealite.
GRF Foliated Granite. Rock affected by dynamic metamorphism.
MIL Mylonite. Rock associated with faults in ductile environment.
GRM Mylonitic Granite. Evidence of ductile faulting in granite.
MET MET Metamorphic rock with strong compositional banding. Unknown protolith.
Source: SRK, 2012
September 7, 2017
Table 7.2: Boa Esperança’s copper deposit ore types.

Mineralization Codes
Interpreted
Intensity Description
Code
SDAT No data. Interval was not recovered or was contaminated.
EST 0 Waste. Minerals associated with soils (with organic matter).
1 Leached zone found at the top of the deposit. The intensity of the mineralization
LIX 2 depends on the limonite content and the degree of supergene alteration of the
3 rock.
1 Copper oxide zone. Located next to sulfide breccias and/or associated with dams
OXI 2 that control the precipitation of copper oxides (geochemical barriers). The
3 intensity depends on the quantity of copper oxide observed.
1
MIX 2 Mix of oxide and sulfide copper minerals (Chalcocite (Cc), Py and Cpy)
3
1
Rich zone with secondary copper sulfides (mainly Cc) and varying quantities of
ENR 2
Cpy and Py.
3
Unit composed of abundant Cpy and of generally large quantities of Py. The
CPY 3
intervals usually have average Cu grades greater than 1%.
1 Cpy is the dominant copper mineral, with greater amounts of Py. The intensity
CPYPY
2 refers to Cpy.
1
Py is the dominant mineral with trace amounts of Cpy. The intensity refers to the
PYCPY 2
amount of mineralization.
3
1
Mineralization composed solely of Py. Cpy is not observed or is absent. Intensity
PY 2
refers to the quantity of Py.
3
Source: SRK, 2012
The breccias are concentrated around the top of the hill, occupying an area of approximately 450 x
350 m. As shown in the geological sections, the copper mineralization has a geometric shape similar
to an inverted cone. Currently known mineralization lies between elevations of 350 m to -200 masl.
This geometry is very similar to that suggested by the breccia observed in outcrops (Figure 7-4) and
is characteristic of a ductile-rupture stage. The breccias are distributed throughout the barren pink
granite lenses. The stripping ratio between waste-rock and mineralization can be roughly observed in
vertical section 10,000, shown in Figure 7-5. Figure 7-6 shows the general orientation of the
mineralized zone.
The breccias are composed of magnetite, quartz, biotite, chalcopyrite, and pyrite, including very small
quantities of molybdenite. The alteration zones around the breccias are small (about 1/3 the thickness
of the breccia) and composed of chlorite with epidote and potassium feldspar.
September 7, 2017
Figure 7-4: Boa Esperança’s granite outcrop cut by anastomosed breccia veins (Source: SRK,
2012).
September 7, 2017
Figure 7-5: Vertical section 10,000 (looking North).
Figure 7-6: Plan view at 135 m.
September 7, 2017
7.3 Property Geology

The geological features observed in the outcrops and drill cores are consistent with the vertical and
horizontal sections of the Boa Esperança copper deposit developed by SRK/MCSA. Furthermore, the
mineralization style is also compatible with a Cu-Fe magmatic-hydrothermal deposit, a granite-related
mineral deposit (Figure 7-7 and Figure 7-8).
The Boa Esperança copper deposit includes primary and secondary zoning. The primary zoning
corresponds to a distal zone, where pyrite (py) dominates, grading towards the copper mineralized
zones of pyrite-chalcopyrite (py-cpy), chalcopyrite-pyrite (cpy-py) and chalcopyrite (cpy).
The secondary zoning is a supergene alteration and is composed of sub-horizontal and discontinuous
lenses of a barren leached zone (LIX), a copper oxide zone (OXY) and a mixed zone (MIX) of oxides
and primary copper sulfides. The barren leached zone outcrops at the hill top (Figure 7-9 and Figure
7-10) and is composed of hematite, goethite and clay minerals. Despite the large amount of sulfide
boxworks found in this area, the leached zone does not contain copper. A copper oxide (OXY) zone
is located immediately beneath the leached zone, and is composed of malachite and copper-bearing
clays. Below the copper oxide zone is an area of mixed oxides (MIX), carbonates, secondary
supergene sulfides (chalcocite and covelite) and primary sulfides (pyrite and chalcopyrite).
The bottommost layer, beneath the mixed oxide (MIX) zone, is a copper-enriched (ENR) zone
composed of sub-horizontal 5 to 10 m thick lenses extending up to 20 to 30 m and formed by primary
and secondary sulfides.
Geochemical associations have been identified. Cobalt is concentrated on the surface, as expected
according to its geochemical properties. However, there is no correlation between the copper and
cobalt grades in the mineralization. Iron is more abundant in the pyrite and chalcopyrite zones, and
higher molybdenum content is found in the chalcopyrite-pyrite mineralization and in the leached zone.
The stratigraphy of the project area can be defined, from the oldest unit to the youngest, as shown
below:
1. Metamorphic Rocks (MET) – Rocks varying in color from light brown to gray with strong banding,
strong silicification. These rocks contain chlorite and epidote and are located in the west of the deposit,
surrounded by intrusive rocks with large xenoliths.
2. Boa Esperança Granite (GRA) – This group of intrusive rocks of varying compositional and textural
types hosts the copper mineralization and intrudes into the metamorphic rocks.
Granite (GRA) – Corresponds to a granitic body, which encompasses the alteration/mineralization in

the project area. Macroscopically, it is a biotite granite with a hypidiomorphic granular texture and an
average composition consisting of feldspar (40%), silica (35%), plagioclase (10%) and biotite (15%).
The biotite displays a weak alteration to chlorite and the granite has some veins of feldspar, quartz
and pyrite with epidote halos. There is granodiorite along the edge of the granite, which likely indicates
that the granite is the result of a hydrothermal alteration phase, representing potassic alteration
consisting of biotite-sericite-K-feldspar.
Granite breccia (GRB) – Corresponds to granite with a weak incipient brecciation.
Coarse-Grained Granite (GRG) – In the northern area of the deposit, there is an intrusive porphyritic
granite rock, with phenocrysts of zoned feldspar up to 2 cm in size, in a matrix of quartz and feldspar.
No contact relationships with the enclosing granite have been observed, but it may correspond to a
change in composition from the same event.
September 7, 2017
Granite Porphyry (PGR) – Displays porphyritic texture, with phenocrysts of feldspar in an aphanitic
crystalline matrix. Contacts with the enclosing granite range from passive to diffuse.
3. Tonnealite (TON) – Intrusive rock that occurs in the western area of the copper deposit; of tonalitic
composition. It seems to be part of the intrusive complex of the host rock to mineralization. There are
textural variations, such as fine texture (TOF), on the edge of the intrusive body, or variations of the
degree of brecciation as in the tonalite breccia (TOB), which shows small areas of a strong incipient
brecciation.
4. Mylonite (MIL) – Mylonite occurs in the areas north, east and northeast of the main copper deposit.
Mylonite is characterized by the occurrence of sericite schists, interstratified with quartzite. It exhibits
mild folding, with attitudes ranging from N15°W to N10°E and dips between 30º and 80º E.
Macroscopically, the rock is a sericite-quartz mylonite, fine-grained, white to yellowish in color, foliated,
nonmagnetic, with large translucent quartz crystals surrounded by clusters of light yellow sericite. The
petrographic analysis describes a foliated rock of medium to coarse crystallinity, intensely sheared
and hydrothermally altered, featuring a cataclastic texture with few traces of the original rock texture
remaining.
The mineralogical composition is as follows: quartz (60%), which occurs as oriented and deformed
medium-grained to coarse-grained anhedral crystals displaying strong undulatory extinction in thin
sections and as granoblastic aggregates which were formed following cataclasis and partial
recrystallization; sericite (38%), which occurs as sheets that form small aggregates surrounding
oriented quartz crystals; locally, prismatic and subhedral pseudomorphs replace feldspar; rutile (2%)
is observed as fine prismatic crystals that are included in aggregates of sericite; and zircon (trace), as
a fine-grained accessory mineral disseminated in the rock. The mylonites correspond to the local
deformation of the granite, or sheared equivalent, which would have occurred before the brecciation.
5. Mylonitic Granite (GRM) – Consists of intrusive rocks affected by mylonitization, with occurrences
of foliation defined by biotite and quartz. Texturally, this rock corresponds to a medium-grained rock,
which is similar to the granite. GRM is pale pink in color, with abundant microcline, quartz, plagioclase,
and epidote crystals. Microscopically, it is a sheared and altered granite, medium-grained, strongly
deformed, and hydrothermally altered to microcline, sericite and epidote, which have granular and
hypidiomorphic granophyric relict textures.
The mineralogical composition is: quartz (25%), allanite (1%), microcline (30%), zirconium (trace),
plagioclase (15%), apatite (trace), sericite (19%), opaques (trace), biotite (3%), chlorite (trace), epidote
(5%), calcite (trace), and sphene (2%).
The mineralogical composition is: quartz (25%), allanite (1%), microcline (30%), zirconium (trace),
plagioclase (15%), apatite (trace), sericite (19%), opaque (trace), biotite (3%), chlorite (trace), epidote
(5%), calcite (trace), and sphene (2%).
GRM represents an intermediate phase between the granite and mylonites, in which the deformation
is not so severe. This unit is also called foliated granite (GRF).
6. Boa Esperança Breccia (BXX) – Corresponds to a hydrothermal breccia, strongly controlled by

tectonic shear structures, in which the open spaces allowed for the later introduction of hydrothermal
mineralization.
September 7, 2017
The first pulse of mineralization introduced quartz-pyrite, which is found in some areas as massive
replacement deposits. The characteristics of these units, its composition and degree of foliation
indicate that the first pulse would have been formed in a brittle structural setting.
The second pulse of mineralization introduced magnetite, biotite and copper. Biotite appears to be the
first event of this second pulse, showing a fluid texture interpreted as syn-shearing. Magnetite has a
massive and only faintly fluid texture, invading the biotite and leaving, in some cases, elongated clasts
of biotite. Pyrite and chalcopyrite were deposited on the edges of the breccia fractures, perhaps
suggesting that the solutions from this event were low in sulfur.
7. Dykes (DIQ) – The grouping of the dykes is primarily dacitic in composition, while others are
intermediate to acidic in composition. They are associated with the younger intrusive volcanic event
(Uatumã) of probable age 1.8 Ga.
Dactitic Dykes (DAC) – These are porphyritic dacites, N70°W in general strike orientation, and whose
general direction is similar to the major regional structural lineaments.
Macroscopically, the dykes are dark pink colored rocks with feldspar crystals which have concentric
zoning, "eyes" of clear quartz with recesses (resorption), chloritized mafic minerals (biotite), as well as
abundant xenoliths (1 to 4 cm in size) of rounded granite.
The matrix is medium- to fine-grained, composed of aggregates of potassium feldspar, quartz and
mafic minerals. In some locations, this unit is moderately chloritized and sericitized. In the area of the
Boa Esperança hill, this unit exhibits supergene alteration to clay, as a result of oxidation of sulfides in
the breccia and granite.
Intermediate to acidic dykes (DIQ) – These are dykes of variable composition and are related to the
regional structures.
8. Microdiorites (MDI) – Microdiorites are present as a series of dykes with a general N50°W to
N70°W direction, are of dioritic composition with a fine granular texture and consist of an aggregate of
plagioclase and mafic minerals. The rock corresponds to a lamprophyre dike of sub-volcanic
emplacement. It exhibits strong hydrothermal alteration to chlorite and saussurite, without deformation,
showing original porphyritic, amygdaloidal, and well-preserved panidiomorphic granular textures.
September 7, 2017
A B
Figure 7-7: A - Chalcopyrite-pyrite ore from drillhole BSPD-162 (99.50 to 103.20 m); B - Pyrite-
chalcopyrite ore in quartz magnetitic breccia from drillhole BSPD-162 (109.00 m).
A B
Figure 7-8: A – Boa Esperança granite with venules of pyrite and chalcopyrite from drillhole
BSPD-136 (191.05 m); B - Chalcopyrite in matrix of quartz magnetitic breccia from
drillhole BSPD-162.
September 7, 2017
Figure 7-9: Top of mineralized zone, leached material composed of quartz magnetitic breccia.
Figure 7-10: Detail of the quartz magnetitic breccia leached at top.
September 7, 2017
7.4 Significant Mineralized Zones

Copper mineralization associated with breccia bodies is present over an area of 1.2 km in a north-
south direction by 1.5 km in an east-west direction. However, the focus of mineralization is beneath
the topographic hill at Boa Esperança, covering an area of about 600 x 400 m (Figure 7-3). The breccia
bodies on plan maps are sub-radial finger-like bodies that extend NW, W, and SW from the center of
mineralization under the hilltop. Individual breccia bodies are shown in this plan as being perhaps 30
m in width and 200 to 800 m in strike length. The main body of mineralization is cone shaped and
tends to pinch out at depths of 400 to 500 m below the base of oxidation (Figure 7-5), with the
mineralization oriented in a predominantly NE/SW direction (Figure 7-6).
September 7, 2017
8 Deposit Type
The presence of magnetite (iron) in the breccias hosting the copper mineralization suggests a deposit
type classified as IOCG (Iron Oxide Copper Gold). However, there are many features that do not match
the proposed IOCG deposit type. Among these is the presence of high-sulfur mineral assemblage
(chalcopyrite-pyrite), rather than the low-sulfur copper sulfide mineral assemblage characteristic of the
IOCG deposit type (chalcopyrite - bornite - chalcocite), as well as the high quartz content, the absence
of pervasive hydrothermal alteration of the host rock, in particular sodic (albite) alteration, and the
absence of gold.
As such, the Boa Esperança copper deposit is a variant of an IOCG deposit type.
8.1 Geological Model

IOCG deposits are considered to be metasomatic expressions of large crustal-scale alteration events
driven by intrusive activity. The deposit type was first recognized, though not named as IOCG, by
discovery and study of the supergiant Olympic Dam copper-gold-uranium deposit, and South American
examples.
IOCG deposits are classified as separate to other large intrusive related copper deposits such as
porphyry copper deposits and other porphyry metal deposits primarily by their substantial
accumulations of iron oxide minerals, association with felsic-intermediate type intrusives (Na-Ca rich
granitoids), and lack of the complex zonation in alteration mineral assemblies commonly associated
with porphyry deposits.
IOCG deposits are still relatively loosely defined and as such, some large and small deposits of various
types may or may not fit within this deposit classification. IOCG deposits may have skarn-like affinities,
although they are not strictly skarns in that they are not metasomatites in the strictest sense.
IOCG deposits can express a wide variety of deposit morphologies and alteration types dependent on
their host stratigraphy, the tectonic processes operating at the time (e.g., some provinces show a
preference for development within shears and structural zones), and so on.
IOCG deposits have been recognized within epithermal regimes (caldera and maar styles) through to
brittle-ductile regimes deeper within the crust (e.g.; Prominent Hill, some Mount Isa examples, Brazilian
examples). What is common in IOCGs is their genesis within magmatic-driven crustal-scale
hydrothermal systems.
IOCG deposits typically occur at the margins of large igneous bodies, which intrude into sedimentary
strata. As such, IOCG deposits form pipe-like, mantle-like or extensive breccia-vein sheets within the
host stratigraphy. Morphology is often not an important criterion of the ore body itself, and is
determined by the host stratigraphy and structures.
IOCG deposits are usually associated with distal zones of particular large-scale igneous events, for
instance a particular Suite or Supersuite of granites, intermediate mafic intrusives of a particular age.
Often the mineralizing intrusive event becomes a diagnostic association for expressions of IOCG
mineralization within a given province.
IOCG mineralization may accumulate within metasomatized wall rocks, within brecciated maar or
caldera structures, faults or shears, or the aureole of an intrusive event (possibly as a skarn) and is
September 7, 2017
typically accompanied by a substantial enrichment in iron oxide minerals (hematite, magnetite). IOCG
deposits tend to accumulate within iron-rich rocks such as banded iron formations, iron schists,
etcetera, although iron enrichment of siliciclastic rocks by metasomatism is also recognized within
some areas.
Supergene profiles can be developed above weathered examples of IOCG deposits, as exemplified
by the Sossego deposit, Pará State, Brazil and at Boa Esperança, where typical oxidized copper
minerals are present; e.g., malachite, cuprite, native copper and minor amounts of digenite and
chalcocite.
Gangue minerals are typically some form of iron oxide mineral, classically hematite, but also
magnetite. This is typically associated with gangue sulfides of pyrite, with subordinate pyrrhotite and
other base metal sulfides. Silicate gangue minerals include actinolite, pyroxene, tourmaline, epidote
and chlorite, with apatite, allanite and other phosphate minerals common in some IOCG provinces.
September 7, 2017
9 Exploration
Project exploration has consisted of ground geological mapping and sampling, geophysical surveys
and exploration drilling. Ground geophysical surveys completed include magnetic and gravity surveys
and induced polarization electrical surveys.
The geophysical surveys were completed by Codelco during the period from 2003 to 2006. The
exploration work conducted by MCSA includes confirmation drilling conducted during the period from
2008 through 2013, and site-specific studies in support of the feasibility studies. A brief discussion of
the historical exploration is presented here, as it is the basis for Codelco’s drilling; MCSA’s
confirmation/infill drilling is described in Section 9.4 and Section 10.
9.1 Mapping and Sampling (Codelco)

Early exploration included mapping 5.0 km2 at a scale of 1:5,000 and surface sampling over 100 x 200
m of approximately 1,100 soil samples. The mapping and sampling identified the copper mineralization
and the general style of mineralization.
9.2 Geophysical Surveys (Codelco)

Ground-based magnetic surveys were completed over 91 linear km on 100 m-spaced lines and a
gravity survey was completed with over approximately 680 point measurements on 200 m-spaced
lines. Induced polarization electrical surveys were conducted over approximately 35 linear km.
A Mise-á-la-Masse electrical survey was also completed during the rainy season, which favored good
electrical conduction through the surface environment of leached rock oxides, resulting in resistivity
and chargeability data of excellent quality. The results show a well-defined body, with Induced
Polarization (IP) chargeability.
The resistivity and IP data have been modeled in 3-D using data inversion, which indicated a
conductive mineralized body. The mineralized conductive body defined by the geophysics model
appears limited in all directions except to the SE. The geophysical anomaly defined does not have a
preferential directional orientation and has no apparent structural control; it represents a primary
geophysical drill target beneath Boa Esperança hill.
9.3 Drilling (Codelco)

The identification of geological, geochemical and geophysical anomalies was followed by core drilling
programs that totaled 62 holes for a total depth of 21,956.12 m on a 200 m x 200 m drilling grid and
was infill drilled with 100 m x 100 m spacing.
Average drill core recoveries exceed 98%. The drill core was also used to collect RQD (Rock Quality
Designation) information for geotechnical purposes and core samples were used to determine specific
gravity.
September 7, 2017
9.4 Drilling (MCSA)

MCSA conducted additional drilling, between 2008 and 2013, of 103 drillholes totaling 36,016.13 m
drilled, for a project total of 57,972.25 m drilled in 165 diamond drillholes. Infill drilling was completed
to approximately 50 and 25 m centers. The drilling is described in Section 10 of this report.
9.5 Relevant Exploration Work

The Codelco drilling during the period of 2003 to 2006 and the follow-up drilling by MCSA between
2008 and 2013 are the relevant exploration work that generated the drillhole assay database, which is
the basis for the Mineral Resource estimate presented in Section 14 of this report.
9.6 Surveys and Investigations

The topography of the project was obtained using high-precision GPS with an accuracy of <5 cm and
a total station system, using two Trimble 5700 GPS receivers and a TOPCON GPT 3007W Total
Station. Two companies were contracted for the topography and drill collar surveying: Topovale
Serviços Topográficos LTDA. and Master Planejamento LTDA.
The drillhole collars are marked with PVC pipes and cement blocks. Detailed information on the
drillholes is recorded on aluminum tags on the cement blocks in such a manner that collar locations
can be verified
9.7 Significant Results and Interpretation

The initial exploration drilling was guided by the mapping and geophysical surveys, and subsequent
drilling conducted was follow-up and infill drilling. The exploration methods used at the Boa Esperança
copper deposit are appropriate for the deposit and were executed in a logical progression, culminating
with infill definition drilling.
SRK is of the opinion that the exploration methods applied at Boa Esperança have been appropriate
for the style of mineralization, are representative of the deposit, and have successfully generated a
verifiable drillhole assay database sufficient to support the Mineral Resources stated in Section 14.
September 7, 2017
10 Drilling
The identification of geological, geochemical, and geophysical anomalies was followed by a core
drilling campaign during the period from 2003 through 2013.
10.1 Type and Extent

The Project’s first drillhole campaign began in 2003 under the supervision of Codelco Brazil Mineração
LTDA. (Codelco). Codelco completed four drillhole campaigns in 2003-2004, 2005 and 2006 (Table
10.1). Figure 10-1 shows the locations of drillholes with respect to geology. Codelco completed 62
core drillholes, totaling 21,956.12 m on a 200 m x 200 m drilling grid that was infill drilled to 100 m x
100 m.
MCSA completed additional drilling between 2008 and 2013, totaling 36,016.13 m for a project total of
57,972.25 m in 165 core holes. Infill drilling was completed to approximately 50 and 25 m centers for
the core of the deposit.
Most drillholes are oriented along an azimuth of 330 ± 10° with dips of approximately 50° to the NW.
Drillholes were down-hole surveyed for azimuth and dip.
Table 10.1: Summary of exploration drilling.

Company Year Number Meters Drillhole Series Comments
Codelco 2003-2004 8 2,865.95 BSPD-01 to 08
Codelco 2004 8 2,990.30 BSPD-09 to 16
Includes BSPD-17 and
Codelco 2005 19 7,798.45 BSPD-17 to 34
BSPD-17A
Codelco 2006 27 8,301.42 BSPD-36 to 60
BSPD-45A
Total Codelco 62 21,956.12
MCSA 2008-2010 43 13,497.58 BSPD-61 to 103
BSPD-64B
MCSA 2011 5 1,672.15 BSPD-104 to 108
MCSA 2012 38 15,475.00 BSPD-109 to 146
MCSA 2013 17 5,371.40 BSPD-147 to 165
Total MCSA 103 36,016.13
Total 165 57,972.25
Source: MCSA
10.2 Procedures
All exploration drilling was conducted using diamond-drill coring. Holes were drilled at an HQ diameter
through soil, saprolite and weathered rock and were reduced to NQ size upon reaching fresh rock.
Average drill core recoveries are reported as exceeding 98%. The drill core samples were also used
to collect RQD information for geotechnical purposes and core samples were used to determine
specific gravity (bulk density) measurements.
September 7, 2017
10.3 Interpretation and Relevant Results

Information on down-hole survey procedures for hole deviations has not been made available to SRK.
Drilling procedures were conducted following industry best practices and provided sufficient
information to allow for resource estimation.
September 7, 2017
Figure 10-1: Exploration drilling map.
September 7, 2017
11 Sample Preparation, Analysis and Security

11.1 Methods
This section describes the methods used by MCSA. Similar methods were followed by
Codelco.
The core sampling procedure begins when the drill core boxes are delivered by the drilling
company to MCSA. A technician checks the drill runs for length and recovery, then marks
and photographs the core. The technician then calculates the RQD (Rock Quality
Designation) and notes the general degree of alteration and hardness.
MCSA geologists then log the drill core and mark the core for sampling, based on the
observed geology and mineralization. The sampling is limited to a maximum sample
length of 1.50 m in the mineralized zones and 4.0 m in the non-mineralized zones.
After the sampling intervals are marked, the core is split in half using a diamond saw and
then quartered, with one quarter sent for analysis and the remaining three quarters stored
for future reference.
Codelco used the SGS Geosol laboratory in Parauapebas, Pará, Brazil to prepare all
samples from the 2003-2006 drilling campaigns. MCSA used the same laboratory to
prepare all samples from the 2008/2009, 2012 and 2013 drilling campaigns. Sample
analyses were carried out by SGS Geosol in Vespasiano, Minas Gerais, Brazil. SGS
Geosol is an internationally recognized mineral testing laboratory. Its management
system is accredited in the ISO 9001:2008 certification standards by ABS Quality
Evaluation Inc., Texas, USA.
MCSA used the Intertek laboratory in Parauapebas, Pará, Brazil to prepare all samples
from the 2010 drilling campaign. Intertek is an internationally recognized mineral testing
laboratory. Its management system is accredited in the ISO 9001:2008 certification
standards by ABS Quality Evaluation Inc. Texas, USA.
All analytical laboratories involved in sample preparation and analyses are independent
from MCSA.
11.2 Security Measures

Samples are in MCSA’s possession from the time the core boxes are delivered by the
drilling company until the ¼ cut core samples are delivered to the SGS Geosol
preparation laboratory, located in Parauapebas, PA, Brazil. The drilling company
provides sample security at the drill site, and MCSA provides sample security during the
geological logging process and through the core quartering for assay samples. The
analytical laboratories provide sample security from the time of delivery at the SGS
preparation laboratory.
11.3 Sample Preparation

The Codelco and MCSA 2008-2009 drill core samples were sent to the SGS preparation
laboratory, located in Parauapebas, PA, Brazil, where they were crushed to a size of 2
September 7, 2017
mm, then separated into a 0.5 kg sample. The 0.5 kg sample was then pulverized to 85
% passing through a 150 mesh sieve. A 50 g sample was taken from the 0.5 kg pulp and
was then sent to SGS Geosol, located in Vespasiano, MG for analysis by Atomic
Absorption. The samples from the 2010 drilling campaign were sent to Intertek laboratory,
also in Parauapebas, where MCSA reports a similar procedure was followed.
Samples from 2012 and 2013 were sent for preparation to the SGS laboratory located in
Parauapebas, PA, Brazil and after that for analysis at the SGS Geosol laboratory in
Vespasiano, MG, Brazil; the same procedures for sample preparation and analysis used
in the 2008-2009 drilling campaign were used in those performed in 2012 and 2013.
11.3.1 Laboratories
The SGS Geosol laboratory in Vespasiano, MG, Brazil and the Intertek laboratory in
Cotia, SP, Brazil completed Cu, Co, Mo, Fe and S analyses on the 50 g pulp samples.
The samples were analyzed for Cu using Atomic Absorption Spectrocopy at SGS Geosol
(Method AAS40B for samples with Cu <0.5 % and Method AAS41B for samples with Cu
>0.5 percent) and Intertek (Method GA50 for samples with Cu <0.5 % and Method GA51
for samples with Cu >0.5 %) laboratories. Samples were also analyzed for Co, Mo and
Fe using Atomic Absorption Spectroscopy and for S using a Lecco analyzer (Method
CSA17V). The SGS Geosol and Intertek laboratories are both known within the industry
as reputable international analytical labs. The management systems for both laboratories
are accredited in the ISO 9001:2008 certification standards by ABS Quality Evaluation
Inc. Texas, USA.
In addition, the QA/QC procedures and their results, as well as the fact that the analyses
conducted were primary analyses for a common commodity such as copper by a standard
analytical technique, do not raise any concerns with respect to the database.
SRK recommends that MCSA document all analytical procedures used by the SGS
Geosol and Intertek laboratories.
11.4 Quality Assurance and Quality Control Programs

Quality control measures are typically established to ensure the reliability and
trustworthiness of the exploration data. These measures include written field procedures
and independent verifications of aspects such as drilling, surveying, sampling and
assaying, data management and database integrity. Appropriate documentation of quality
control measures and regular analysis of quality control data are important safeguards of
project data and form the basis for the quality assurance program implemented during
exploration.
Analytical control measures typically involve internal and external laboratory control
measures implemented to monitor the precision and accuracy of the sampling,
preparation and assaying. They are also important in preventing sample mix-up and
monitoring the voluntary or inadvertent contamination of samples.
Assaying protocols typically involve regularly duplicating and replicating assays and
inserting quality control samples to monitor the reliability of assaying results throughout
September 7, 2017
the sampling and assaying process. Check assaying is normally performed as an

additional test of the reliability of the assaying results; it generally involves re-assaying a
set number of sample rejects and pulps at a secondary umpire laboratory.
MCSA relied partly on the internal analytical quality control measures implemented by
the SGS Geosol and Intertek laboratories. In addition, MCSA implemented external
analytical control measures consisting of inserting control samples (standard reference
and blank material and replicate assays) in all sample batches submitted for assaying.
The blank material used for MCSA is not a certified material; it consists of rhyolite and
rhyodacite dykes from the Boa Esperança project. These samples were prepared
internally.
The samples were analyzed for Cu using Atomic Absorption Spectrocopy in the SGS
Geosol (Method AAs40B for samples with Cu <0.5 % and Method AAS41B for samples
with Cu >0.5 %) and Intertek (Method GA50 for samples with Cu <0.5 % and Method
GA51 for samples with Cu >0.5 %) laboratories. Samples were also analyzed for Co, Mo
and Fe using Atomic Absoportion Spectroscopy and for S using a Lecco analyzer
(Method CSA17V).
MCSA also used three copper non Certified Reference Materials (standards) obtained
from SGS Geosol in Belo Horizonte, Brazil. Their characteristics are listed in Table 11.1.
Control samples were inserted in one of approximately every 7 samples; analyses of
replicate pulp assays of mineralized rock were also completed. Each batch of drilling
samples (40 samples per batch) consisted of one duplicate sample, one blank sample
and three Standard Reference Materials. MCSA did not use an umpire laboratory during
the drilling campaigns, and it is SRK’s recommendation that they implement the use of
one in future studies.
Table 11.1: Specifications of standard reference materials used by MCSA for the
Boa Esperança copper project.
Standard Reference Reference Value Standard
Source Number of Samples
Material (Cu%) Deviation
SGS LG SGS 0.2048 0.0037 177
SGS MG SGS 0.6063 0.0137 172
SGS HG SGS 1.1018 0.0691 251
11.5 SRK Comments

It is SRK’s opinion that the sampling preparation, security, and analytical procedures used
by MCSA, SGS Geosol and Intertek laboratories are consistent with generally accepted
industry best practices. SRK considers the exploration data collected by MCSA to be of
sufficient quality to support Mineral Resource evaluation. It is suggested that MCSA
certify the standards and blanks used in the Boa Esperança project and document all
QA/QC procedures.
September 7, 2017
12 Data Verification
12.1 Procedures
SRK verified the database by checking more than 10% of the database against the
original laboratory certificates and found no significant errors. About 25% of the drillhole
collars were also checked against original certificates for accuracy.
MCSA has a QA/QC program in place and regularly monitors the results. The program
and results are described in Section 12 of this report.
12.2 Verification of Analytical Quality Control Data

MCSA provided SRK with external analytical control data containing the assay results of
the quality control samples from the Boa Esperança copper project. All data were
provided in Microsoft Excel spreadsheets. Control samples (blank and standard
reference materials) were summarized on time series plots to highlight their performance.
Paired data (pulp duplicates) were analyzed using bias charts, quantile-quantile plots and
relative precision plots.
The external analytical quality control data produced for the Boa Esperança copper
project are summarized in Table 12.1 and presented in graph form in Appendix A. The
external quality control data produced for this project represent around 5 % of the total
number of samples assayed.
Table 12.1: Summary of analytical quality control data produced by MCSA on the
Boa Esperança copper project.
Total (%)
Sample Count 22,436
Blanks 270 1.20%
Standards 600 2.67%
Pulp Replicates 268 1.19%
Total QC Samples 1,138 5.07%
Blank samples were analyzed for five elements (Cu, Co, Mo, Fe and S). The most
relevant of these elements (Cu), particularly in the last drilling campaigns, yielded values
below the 0.1% Cu warning limit. In the blank results for the 2008/2009 drilling campaign,
more than 20 % of the results are above the upper limit (UL). According to SRK’s 2012
report, MCSA reported that the blanks were from contaminated material, and the material
has been changed.
All blank results from the 2010 and 2012 drilling campaigns are below the UL. In the 2013
drilling campaign 3 % of samples are above the UL.
MCSA used one standard reference material (High Grade) during the 2008/2009
campaign. In more recent years, three standard reference materials (Low Grade, Medium
Grade and High Grade) were used.
SGS and Intertek delivered consistent Cu results, mostly within two standard deviations
(see Appendix A). The results for the High Grade (HG) standard reference material show
September 7, 2017
consistently lower values than expected in all drilling campaigns. This shows that there
is a negative bias for the HG standard reference material.
In the 2010 drilling campaign there are two results for Medium Grade (MG) standard
reference material that appear to be mislabeled. This is also the case for Low Grade (LG)
and MG standard reference materials during the 2012 drilling campaign.
Paired assay data examined by SRK show that assay results can be reproduced by the
SGS Geosol and Intertek laboratories from duplicate pulp with high confidence. Rank half
absolute difference (HARD) plots show that for the 2008/2009 samples, 74 % have HARD
below 10 %, while for 2010 samples, 75 % have HARD below 10 %, for 2012 samples,
88 % have HARD below 10 % and for 2013 samples, 84.6 % have HARD below 10 %. In
addition, all duplicate pairs have a correlation coefficient of 0.98 or higher.
MCSA did not use an umpire laboratory for testing. See Appendix A for bias charts of all
analyzed elements.
In general, SRK considers the analytical quality control data delivered by the laboratories
utilized by MCSA and reviewed by SRK to be sufficiently reliable for the purpose of
resource estimation.
SRK recommends that future quality control programs include the use of certified blank
samples and certified standard reference materials and that MCSA employ an umpire
laboratory.
12.3 Data Adequacy

It is SRK’s opinion that the database has been adequately verified and is suitable for use
in resource estimation.
September 7, 2017
13 Mineral Processing and Metallurgical

Testing
13.1 Pre-concentration and Processing Report
Experimental work on the rock types from Boa Esperança (Tucumã county, Pará State)
have demonstrated the technical feasibility of a pre-concentration operation for both rock
types - granite and breccia.
This interest of such pre-concentration can be understood by the comparison of figures

13-1 and 13-2. The first one is the conventional circuit for sulfide rock types. All the ore
is crushed and ground and fed to the concentration circuit (froth flotation - be it bulk or
sequential). An enormous volume of fine tailings is produced and must be discarded.
Figure 13-2 is a flowsheet with pre-concentration.
The best way to discard these tailings is in tailing dams. But, as they have environmental
restrictions they became a project problem. The alternative way found by the MCSA's
team is the route named “dry stacking”, where the tailings are dewatered in thickeners
followed by press filters and the cake is hauled by trucks, or conveyed, and disposed in
piles, as shown in Figure 13-1.
Figure 13-1: Conventional Processing
Figure 13-2 shows the effect of pre-concentration: a jig (or other density-based separation
equipment) is introduced in the circuit after crushing. The heavy minerals (sulphides) are
separated from the light ones, which are immediately discarded. As the ore is low grade,
a significant amount of tailings (light product) is discarded at once and the stream fed to
the concentration circuit is significantly reduced.
As a result, the size of the grinding mill as well as the size of the froth flotation equipment
is reduced, what is traduced in a significant decrease in Capex. The same happens to
the thickeners and filters which will dewater the tailings in the case of dry stacking.
September 7, 2017
Figure 13-2: Processing with pre-concentration

Pre-concentration of the plant feed will serve to discard a significant amount of tailings
that would otherwise be fed into the flotation mill. The primary envisoned advantages are:
1. Reduced size of the flotation plant (reduction in Capex) by discarding waste prior
to milling (diminishing the feed mass rate);
2. lowering processing cost (also a result of the diminished feed massto the mill);
3. selectively discarding quartz. This mineral is very difficult to grind and highly
abrasive. Therefore, not only will the size of the ball mill and froth flotation
equipment be reduced, but the wear of balls and linings will as well, further
reducing operating costs;
4. diminishing the volume of tailings to be thickened and accumulated on tailing

dams, or alternative discarding processes.
Additionally, as there is an enrichment of the pre-concentrate, marginal rock types that

otherwise would be below cutoff grade may be upgraded and become economic.
The basic experimental work was carried out at Alfenas Federal University (Unifal), Poços
de Caldas Campus12. Their results demonstrate that:
1. copper tends to concentrate in the size fractions below 3.3 mm. The copper
enrichment is approximately 35% for the granite sample and approximately 60%
for the breccia sample. `
2. the sink-and-float tests showed better results for mass and metallurgical
recoveries in the finer fractions minus 6.35 mm and plus 3.35 mm. The granite
sample had better results than the breccia sample.
3. the size fraction -6.3+3.35 mm of the granite yielded a sunk product which
contained 33.8% of the initial mass and 90% of the contained copper, plus 95.8%
of the cobalt. This represents a 73% reduction of the 38.8% mass fed to flotation.
The floated product at density 2.7 dragged 61.2% of the mass with a 0.10% Cu
grade, which means that only 10% of the contained copper was lost.
September 7, 2017
4. for the breccia sample, the sunk product for the size fraction +6,35 mm
concentrated 84.35% of the mass, 99.2% of the contained copper, and 98.3% of
the cobalt. For the size fraction -6,35+3,35 mm, respectively 78.6, 98.3, and
98.3%. The mass reduction was from 84.3% to 78.6%. The floated product at
density 2.7 lost 21.4% of its mass with the grade of 0.09% Cu (1.7% of the
contained copper).
13.2 Previous Work

MCSA purchased the mineral property in 2007 and preliminary metallurgical testing was
done in Chile by CIMM – Centro de Investigaciones Minero Metalúrgicas during April
2007 and July 2009.
MCSA, with the assistance of Coffey Mining Brazil, in 2009, made a structural evaluation
of the deposit, based on the available data and a drilling campaign that was concluded at
same year.
Samples were prepared for additional laboratory testing.
Fundação Gorceix, in 2009, did experimental bench studies on froth flotation and in a
small-scale pilot plant. The classical routes for sulphides flotation, bulk flotation and
sequential flotation were tested. The sample, comprised of 1.2 tonnes of material, was
submitted to froth flotation small-scale pilot studies, with capacity of 15 and 20 kg/h, after
crushing to -3.5 mm, grinding: 0.3% +200#, 97.4% -400#. Results were:
• bulk flotation, cleaner: better concentrate = 25.1% Cu, 95% copper recovery,
5.6% mass recovery.
• Sequential flotation: 19.2% Cu, 90% copper recovery, 3.4% mass recovery.
An additional experimental program was conducted at CIMM, Chile, in 2009 using a

master composite sample.
The preliminary flowsheet (Sequential 1) included bulk sulphide flotation followed by

differential flotation of copper sulphides and pyrite. This flowsheet was followed by testing
with sequential copper sulphide flotation followed by pyrite flotation (Sequential 2).
Locked cycle tests results of both options are compared as shown in Table 13.1.
Table 13.1: Bulk x differential flotation results
Test conditions in the aforementioned program were:
• grinding - 75% -106 µm,

• regrinding - 80% -38 µm,
• copper promoter - Aero 3477, 27 g/t,
• frother - MIBC, 20 g/t,
• pH for rougher flotation - 10.5,
• pH for cleaner flotation -11.0,
• pyrite promoter - potassium amilxantate and Aero 6697, 20 and 15 g/t,
September 7, 2017
• pH for pyrite rougher and cleaner flotation - 7.0.
In 2011, additional tests for crushability and grindability of the ore were made at Metso's
laboratories. The measured crushing work indexes ranged from 14.9 to 18.1 kWh/t
(difficult ore to crush); the abrasion indexes ranged from 0,321 to 0,536, showing it is an
abrasive ore.
Ball mill work indexes varied from 13,9 to 17.0 kWh/t showing it is a medium/hard ore to
grind.
Following the results of the sequential flotation tests, a new froth flotation test program
was performed at SGS Geosol facilities. It included:
• crushing, grinding (-106 µm), copper rougher/scavenger flotation, concentrate

regrind (-38 µm), copper cleaner flotation and dewatering of tailings and
concentrates.
• six different types tested: granodiorite - GRA and breccia - BXX
These samples covered the ore types considered from a geological stand point as is
shown in Table 13.2.
Table 13.2: Head grade analysis of the tested samples
September 7, 2017
Locked cycle tests included 8 samples to assess the variable response at different head-
grades of mill feed. The summary of these locked cycle flotation tests results for copper
is like shown in Table 13.3 and
Table 13.4.
Table 13.3: locked cycle testes results for copper
Table 13.4: locked cycle tests results for pyrite (%)
The following conclusions can be made about the locked-cycle testwork
• composite sample: 28.0% Cu, 90% copper recovery

• samples GRA-AT, GRA-MT and BXX-AT: 28.0% Cu, 90% copper recovery
• samples GRA-BT, BXX-MT and BXX-BT: 20 to 28.0% Cu, <90% copper recovery
• when crushed to -2 mm, and ground to -150# (106 mm), the samples tested
displayed quick flotation kinetics (<4 min).
The resulting copper concentrate from the variability testing was analyzed by ICP and
yielded the results presented in Table 13.5.
September 7, 2017
Table 13.5: ICP results of the locked cycle variability flotation tests
The deleterious elements (F, Cl, U, As, P, Pb and Zn) are printed in red. Based on
resultant values, no smelter penalties are expected.
Complimentary thickening and filtering dewatering tests were also performed, by Outotec,
for the final tailing and the pyrite concentrate, using flocculent Flonex 910SH. They led to
respectively, 0.71 and 1.0 (t/hr)/m2, and 70.3 and 62.2% solids reporting to the underflow.
Additional tests were done by Diemme Filtration R&D. The tests were done on copper
concentrate, leading to a settling rate of 0.26 (t/hr)/m2, 55% solids at the underflow, using
Praestol (Ashland) flocculent, 50 g/t. This underflow was then pressure filtered leading to
a cake with 8-10% moisture and a filter rate of 0.128 (t/hr)/m2.
SRK reviewed the data, and concluded the following:
1. The rock types can readily be concentrated into a copper-bearing concentrate

with minimal impurities using conventional processes. Final concentrates
assaying 25-29% Cu can be produced.
2. Copper recovery is related to the grade as shown in Table 13..
Table 13.6: Relation of grade to recovery(%)
3. The main deleterious contaminants like F, Cl, U, As, P, Pb and Zn are present in
traces so that smelter penalties are not expected.
September 7, 2017
4. Bond crushability indexes varied from 14.9 to 18.1 kWh/t, averaging 16.7 kWh/t
what indicates a difficult crushing ore.
5. Bond ball mil work indexes ranged from 13.9 to 17.0 kWh/t with an average of
15.7 kWh/t, indicating a medium/hard ore.
13.3 Suitability of Boa Esperança Rock types to Pre-

Concentration and Flotation
The rock types from Boa Esperança are not disseminated as most porphyritic rock types
from Chile and Peru. Sulphides occupy faults and fractures in the matrix, as shown in
Figure 13-3 (the brown lines represent sulphides, and the white mass, the granitic matrix)
and shown in the photos of the rock types (Figure 13-4 and Figure 13-5).
Figure 13-3: Schematic of occurrence of the sulphide minerals
Figure 13-4: Breccia
September 7, 2017
Figure 13-5: Granite
As shown in the Figures above, the sulphides are distinct relative to the granites. This
differential between the sulphide bearing zones and non-sulphide bearing zones, resulted
in the pursuit of a pre-concentration step aimed at improving the grade of the material
sent to the mill. The following section describes this work in greater detail.
13.4 Experimental Work on Pre-concentration

13.4.1 Alfenas University
Treatment consisted in crushing, size analysis of the crushed product, and sink-and-float
tests on selected size fractions. sink-and-float tests were carried out on two size fractions,
at four different densities.
Results have shown that the interest elements (copper and cobalt) concentrate in the size
fractions under 3.35mm, with enrichment of approximately 35% for the granite and 60%
for the breccia.
The tests in a second stage confirmed these results, with significant mass reduction in
the concentrate, and minimal metal losses in the tailings. It is important to point out that
this stage tested the fraction - 12.7+3.35 mm, and therefore the enrichment in the finer
fractions had no use at this phase.
An intermediate density of 2.75 was adopted for further testing. At this density, the light
fraction was discarded with no significant metal losses, especially for the breccia. In the
granite sample, the sunk product at 2.75 concentrated 32.2% of the mass and 86.2% of
the contained copper, and 95.6% of the cobalt. The copper grade increased from 0.54 to
1.44%, and the cobalt grade went from 108 to 321 ppm. The floated product rejected
67.9% of the mass with 0.11% Cu grade, corresponding to 13.8% of the copper contained
in the feed mass.
As a result, the fraction to be fed into the flotation will have 1.38% Cu grade (enrichment
of 79%) and 286 ppm Co (enrichment of 169%). In this scenario, 67.9% of the initial mass
will be discarded. Losses are up to 13.9% of the contained copper and 4.4% of the cobalt.
In the breccia sample, the sunk product in the same density concentrated 78% of the
mass and 98.8% of the contained copper and 99.4% of the cobalt. The copper grade
September 7, 2017
increased from 1.205 to 1.36%, and the cobalt grade went from 565 to 730 ppm. The
floated product rejected 22.05 of the mass with 0.06% Cu, which means 1.2% of the
copper contained in the feed mass.
That way, the fraction to be fed into flotation will have a grade of 1.34% Cu (enrichment
of 85% as compared to the feed) and 689 ppm Co (enrichment of 21%). In this scenario,
22% of the initial mass will be discarded, and 1.2% of the contained copper and 0.5% of
the cobalt will be lost.
MCSA chose the fraction -12.7+3.35 mm (-1/2+1/8”) for subsequent testing, with the
intention of minimizing the crushing stages.
Table 13.6 and Table 13.7 show the results of this work.
Table 13.6: Results granite -1/2+1/8”
Table 13.7: Results breccia -1/2+1/8”
These numbers confirmed the previous results - a significant mass reduction and small
metal losses is possible. SRK confirmed that the samples were representative of the
deposit, and that the results obtained were valid.
13.4.2 SGS Geosol

A systematic froth flotation test program was performed and ended with a “locked cycle
test”, aimed at simulating the results of a continuous froth flotation circuit. A statistical
quality control for the experiments was performed to confirm the results.
Results herein are described using the following rock codes (GRA = granite, BXX =
breccia):
• concentrate assaying 28% Cu, recovering 91.5% of the contained copper for the
composite sample,
• concentrate assaying 28% Cu, recovering 90% of the contained copper, of the
contained copper for samples GRA-AT, GRA-MT e BXX-AT,
September 7, 2017
• concentrate assaying 20% Cu to 28% Cu, recovering less than 90% of the
contained copper for samples GRA-BT, BXX-MT e BXX-BT. Table 13.8
summarizes the results.
Table 13.8: Results – SGS Geosol
This table provides important information about other elements present in the
concentrates. Selenium, Tellurium, Mercury and Arsenic are undesirable impurity
elements.
Selenium grades in the concentrates varied from 17 to 24 ppm. Tellurium grades were
below the detection level for the chemical instrument used. Mercury varied from 0.02 to
0.10 ppm, and Arsenic, from 2 to 4 ppm. Based on these values, the Project concentrate
has minimal impurity elements.
13.4.3 Fundação Gorceix – Pre-concentration test

Pre-concentration tests with a pneumatic AllMineral jig, were performed at size fraction
of -12,5mm +2,0 mm.
For the granite, the first level of concentration showed an upgraded copper grade of 2.1%,
76.0% recovery of the contained copper and rejected 74.0% of the total mass.
Since the breccia, in general, has greater initial grades for Cu and S, a better result was
achieved: the first and second levels of concentration achieved a concentrate assaying
2.0% Cu, 87.1% recovery of the contained copper and rejected 48,3% of the feed mass.
One must mention that a small parcel of ultrafines present in each of the samples was
driven to the jig chamber, and contained copper. This confirms this equipment (jig) is
effective in concentrating fines via interstitial movement of the particles across the bed
September 7, 2017
when closed. The fines behavior presents the necessity to test the behavior of the fines -
3 mm, which will be scalped prior to jigging in operation.
13.4.4 Mintec
Mintec tested both types of ore, crushed at -1", in the size fraction -1+1/8” (-25.4+3.35
mm). The results obtained were:
• breccia- feed assaying 1.55% Cu and 580 ppm Co enriched to 2.65% Cu (E =

1.71) and 1,053 ppm Co (E = 1.81), mass recovery = 50%.
• granite - feed assaying 0.80% Cu and 115 ppm Co enriched to 1.23% Cu (E =
1.54) and 218 ppm Co (E = 1.90), mass recovery = 55%.
These tests were run in a continuous heavy-medium separation cone, using a slurry of
ferro-silicon as heavy medium.
The samples were crushed to -11.2mm and screened into three fractions: 11.20mm
+6.00mm, -6.00mm +3.35mm and -3.35mm. As the - 3.35mm fraction will go straight to
milling/flotation, without pre-concentration.
Table 13.9 shows the results presented in Gekko report, considering only copper in the
analysis.
Table 13.9: Gekko results
Based on the results, pre-concentration has been demonstrated to be an effective

approach for the Project.
13.4.5 Jigging tests
• Sample Composition
September 7, 2017
A drill campaign was performed to obtain representative samples for the jigging tests.
Twenty-eight holes were drilled to generate the necessary mass for testing of the
composite sample.
The cores were sawn and half of them were used to compose the tested sample. One
quarter was kept as a duplicate and the last quarter was used for chemical analysis so
as to confirm that composed the sample would be representative of the deposit.
The final masses were approximately 2.5 t of ore; the granite grade was between 0.27
and 0.45% Cu, and the breccia grade was higher than 1%.
Based on the analysis, the composite sample used in the jigging trial studies are
representative of the deposit and the nature of the mineralization and other material
throughout the Project.
• Sample Crushing
The samples were crushed in a jaw crusher at -10mm, screened at 3 mm, and stored in
plastic bags with approximately 35 kg, so as to facilitate handling.
• Tests on the Trays Jig (bench testing)
This jig's box comprises several overlaying trays, which may be individually removed after
the bench test. The analysis of the material contained in each tray allows for the choice
of the best separation level and thus to program the operation of the continuous jig (pilot
or industrial).
The tests were carried out in the SGS lab in Vespasiano, MG. The results are
summarized on Table 13.10.
September 7, 2017
Figure 13-6: Trays jig
September 7, 2017
Table 13.10: Bench jigging tests
September 7, 2017
September 7, 2017
The most important conclusions are the following:
1. the AllMineral jig was effective in separating low-grade tailings for both rock types
- breccia and granite.
2. the optimal condition for each ore is the separation of 50% of the mass for each
product.
• Continuous Jigging Tests
The circuit used for testing is shown in figure 10. It is set up in the SGS lab in Vespasiano,
MG. It comprises:
• a feed bin with a rotary table feeder,

• an AllMineral jig with two jigging chambers,
• a vibrating horizontal screen to dewater the (heavy) concentrates,
• a fixed sieve to dewater the (light) tailings,
• a water pump to recycle the water recovered from the concentrate,
• an air compressor to feed the jig’s air chamber.
The operational variables evaluated:
• the amplitude of the jigging cycle, controlled by the air flow,

• the frequency of the jigging cycle, controlled by the air valves,
• the height of the sunk product’s bed.
September 7, 2017
The jig is unloaded by using the concentrate dewatering screen. These variables had
their set points adjusted at, respectively, 8 cm, 80 pulses/minute, and 26 cm.
Operational control of the jig is made by using a floating device. It has a lever arm which
allows to adjust its density to the desired cutting density.
As the density of the bed must be kept constant, and automatic device activates the
dewatering screen when the bed height exceeds the desired height.
13.4.6 Flotation and Magnetic Separation Tests of the Jig

Concentrate Recombined with the ROM -3 mm Size Fraction
The jig concentrate was then recombined with the fines -3 mm of the ore and ground in
a rod mill. The achieved size distribution is presented in Table 13.11 that presents also
the chemical analysis per size fraction.
Table 13.11: Size distribution and chemical analysis per size fraction
Nine aliquots of the jig pre-concentrate were analyzed and yielded an average grade of
0.90% Cu, 17.9% Fe and 7.5% S. Additionally, the ore contains 442 ppm of Co, 103 ppm
Mo, V< 60 ppm and As and U < 20 ppm.
The copper locked cycle flotation test consisted of a rougher stage yielding a tailing and
a rougher concentrate that was reground. This product was submitted to cleaner stage,
a recleaner and a scavenger of the cleaner.
The recleaner flotation yielded the final copper concentrate. Its tail joined to the cleaner
scavenger concentrate recirculated into the cleaner. The cleaner scavenger tailing was
joined to the rougher tail and sent to pyrite flotation.
Flotation conditions can be summarized as pH = 11.1 for rougher, 11.5 for cleaner and
11.6 for recleaner, promoter = Clariant's D245 (28 + 5 g/t), frother = metilisobutilcarbinol
(MIBC, 25 +6 + 6 g/t).
The copper concentrate analyzed 28.9% Cu, 32.1% Fe and 34.6% S, 23 ppm Ag, 1.8
ppm Au, 784 ppm Co, 647 ppm Mo, 47 ppm As, 24 ppm V, 0.07 ppm Hg, F<50 ppm,
Cl<20 ppm and U<20 ppm.
Pyrite flotation tests were done on the copper flotation tailings.
Flotation conditions were: residence time = 5 min, pH = 7.5, frother = MIBC (26 g/t). No
additional promoter was added.
The pyrite concentrate analyzed 0.42% Cu, 45.6% Fe and 43.1%, 2,867 ppm Co, 225
ppm Mo, 33 ppm V, As<10 ppm and U<20 ppm.
September 7, 2017
Exploratory magnetic tests were performed on the pyrite tailings.
Exploratory tests were done on a Davis tube and in sequence on a High Intensity Wet
Magnetic Separator under fields varying from 2,000 to 14,000 G.
As the results showed poor selectivity, a drum separator operating at 1,000 G was used
in a rougher-cleaner configuration, leading to concentrates assaying 67.0% Fe for a
74.0% recovery.
Such a concentrate analyzed 0.82% Al2O3, 0.005% P and 3.13% LOI.
13.5 Conclusions
The results of the tests carried out at SGS and Unifal, as described above, allow us to
establish the following:
• jigging using simple equipment such as the AllMineral jig (a Baum-type

pneumatic jig) has proven effective. This means that more sophisticated
techniques, such as separation in dense media, or specialized equipment such
as jigs with artificial beds or for special use, are unnecessary.
• 30% of the crushing product is under 3 mm and shows copper enrichment factors
between 1.55 and 2.0 as compared to the ROM copper grade. The coarse
fraction which feeds the jig has copper grade enrichment factors between 0.75
and 0.8 of the ROM grade..
• 50% of the mass is rejected in jigging. The copper recovery varies from 86 to
96%. Adding to this recovery the recovery of the copper contained in the finer
fraction (-3 mm) of the crushed product, the total recovery of the circuit will go up
to 90-96%.
• the crushing/flotation circuit is fed with pre-concentrate, to which the finer fraction
(-3 mm) of the crushed product is added.
• metallurgical recovery varies according to the grade of the feed as shown in
Table 13.12.
• the experimental results are summed up in Table 13.12.
September 7, 2017
Table 13.12: Results of the continuous jigging tests
September 7, 2017
• after discarding the jig tailing, combining its concentrate to the -3mm natural fines, grinding,
making a rougher copper flotation, regrinding the concentrate, performing pyrite flotation and
magnetic separation of the pyrite tailing, a final balance could be stablished for the Boa
Esperança circuit as shown in Table 13.13.
Table 13.13: Mass and metallurgical balances
• pre-concentration has shown to be a feasible route to process both ores from Boa Esperança
- granite and breccia. The pre-concentration operation allows for the use of a greater portion
of the low-grade granite ore which increases the reserves.
• besides increasing the grade of the ore fed into crushing/flotation, pre-concentration
diminishes the mass to be fed to the preparation plant resulting in an overall reduction of the
Opex/Capex, due to a reduction of the size of the plant (mill / flotation/ thickeners / filters /
dams, etc.).
• the tailings from pre-concentration are coarse. They will be dewatered in dewatering piles and
disposed along with the overburden. That means they will not be sent to tailing dams,
significantly diminishing the size of those facilities. If the alternative route of thickening, filtering
and dry stacking the tailings is chosen, filtering the underflow from thickening and disposing it
in landfills (“dry stacking”) seems to be the best alternative, as the volumes to be thickened
and filtered diminish significantly, with huge economy in thickener and filters.
• the experimental results from the bench/pilot jigging tests have confirmed the experimental
results obtained by Alfenas University, Fundação Gorceix, and Mintec. It is, therefore, a
reproducible, robust, and reliable process.
• Experimental results can be summarized by Table 13.14 and Table 13.15.
September 7, 2017
Table 13.14: Experimental results for jigging
Table 13.15: Experimental results for jigging + flotation
• The relation recovery x ROM grade can be summarized as shown in Figure 13-7. Figure 13-7
shows the experimental data and two different correlation functions, both with excellent
adherence (r2). The red curve presents the overall recovery values for smaller ROM content
to 0.57% Cu, and the blue curve shows the overall recovery to higher grade than or equal to
0.57% Cu ROM.
September 7, 2017
Figure 13-7: Overall recovery x ROM grade (Cu%)
September 7, 2017
14 Mineral Resource Estimate

The Mineral Resource estimate was prepared by SRK Senior Geologist Rafael Russo Sposito and
supervised by SRK Principal Resource Geologist Carlos César Barbosa; Mr. Barbosa is a Qualified
Person and is independent of MCSA as defined by NI 43-101 guidelines.
The Mineral Resource estimate was prepared using a three-dimensional percentage block model of
10 m x 10 m x 5 m. In addition, oxidation state and resource classification codes were assigned to
each block. The resource estimation was conducted using Geovia GEMS™ (v6.6) software. Other
graphs were created using GSLIB software.
The general procedure used for resource estimation was as follows:
• The drillhole data was imported into GEMS™ and examined for data errors, such as
overlapping intervals, missing data, etc. The problems detected were corrected by MCSA
geologists;
• Wireframes were constructed at a CoG (Cut-off Grade) of 0.2 % copper. The wireframes
followed the same guidelines as in earlier estimations, adjusting for the inclination of the
bodies, and were established in collaboration with MCSA geologists;
• Statistics were run for assays within the wireframes and lognormal probability plots were
examined for data outliers;
• Assays were composited into 2 m length intervals from the top of the drillhole and statistics
were run for the composites within the wireframes;
• Block grades were estimated for copper, iron, sulfur, molybdenum and cobalt using ordinary
kriging (OK) with composites inside the wireframes for sulfide ore. Nearest neighbor grades
were also estimated, in order to provide a comparative model used to validate the OK grades;
• Resources were classified in accordance with the estimation pass and the anisotropic distance
to the nearest composite.
14.1 Modeling Coordinate System

The drillhole collar coordinates were surveyed using UTM Zone 22/SAD-69 coordinates. The block
model was constructed in the same UTM coordinate system.
14.2 Drillhole Data

The drillhole database was provided by MCSA as a database file with collar coordinate tables, down-
hole surveys, lithologic codes and assay data. The data include drillholes BSPD-01 through BSPD-
163; basic statistics of the drillholes are shown in Table 14.1 and a drillhole location map is shown in
Figure 14-1.
Table 14.1: Drillhole statistics.

Length (m)
Minimum Maximum Average Total
162 27.95 1005.95 350.4 56,765.45
September 7, 2017
Figure 14-1: Drillhole location map.
September 7, 2017
The database tables include the following information:
Collar data – These include drillhole identification, easting, northing, elevation and total depth.
Down-hole Surveys – These were conducted to measure the depth of the survey, azimuth and
inclination. All drillholes in the main orebody are angled toward either the northwest or southeast with
inclinations between 45° and 65°.
Assay – The assay data includes the following headings: sample number, from, to, assay interval,
copper, cobalt, iron, molybdenum and sulfur. Basic statistics for copper and the assay interval length
are shown in Table 14.2.
Table 14.2: Statistics for copper and assay interval length.

Type Number Minimum Maximum Average Total Meters
Interval 21831 0.2 m 5.65 m 1.96 m 42,869.08
Cu 21831 0.00% 12.90% 0.35% 42,869.08
Geology – The geology file includes information under the following headings: from, to and lithology
code. The lithology codes and a description of the codes are shown in Table 14.3.
Table 14.3: Lithology codes.

Type Code Description
No Data SDAT No data; no drilling recovery
DIQ Dike of unknown composition
Dike Dacitic dykes associated with recent structural hydrothermal systems, trending
DAC
N75W
Microdiorites; lodes associated with the most recent structural system, trending
Microdiorite MDI
N75W
Hydrothermal breccia, with a matrix composed of magnetite (mag), biotite (bio),
BXX
chalcopyrite (cpy), quartz (qtz), and pyrite (py)
Breccia mainly composed of quartz fragments with a matrix of mag, bio, cpy and
BXQ
Breccia py
BXG Breccia mainly composed of granite fragments with a matrix of mag, bio, cpy, py
VET Massive sulfide veins, composed predominantly of py with minor cpy and mag
GRA Granite, host rock
GRB Brecciated granite
GRG Coarse-grained granite; porphyritic in the northern region
PGR Porphyritic granite with abundant potassic feldspar
TON Tonnalite; possibly the host rock unaffected by potassic alteration
Granite
TOF Fine-grained tonalite
TOB Brecciated tonalite
GRF Foliated granite which has undergone dynamic metamorphism
MIL Mylonite associated with fold structures
GRM Mylonitic granite associated with ductile faults
Metamorphic MET Metamorphic rock with strong compositional banding; unknown protolith
September 7, 2017
Mineralization – The mineralization codes are defined by oxidation state – either leached, oxidized or
sulfide. The sulfide intervals are broken down into further classes based on the relative abundance of
chalcopyrite and pyrite as shown in Table 14.4.
Table 14.4: Mineralization codes.

Type Description
Lix Leached zone in the upper part of the deposit
Oxi Oxidized zone above the sulfide zones
Mix Mixed zone of oxides and sulfides
Enr Zone of secondary enrichment
Cpy Abundant cpy and major py; generally over 1% Cu
Cpypy Dominant cpy and major py; generally greater than 0.3% Cu
Pycpy Dominant py with traces of cpy
Py Sulfide is exclusively py
14.3 Topography
The topography was obtained by Topvale Serviços Topográficos LTDA. (Topvale) using a high-
precision GPS with an accuracy of <5 cm and a total station. The equipment included:
• 2 Trimble 5700 L1/L2 GPS receivers, with 01 R6 collector; and

• 1 TOPCON GPT 3007W Total Station.
Topvale also surveyed the collar coordinates of MCSA’s drillholes. Master Planejamento LTDA.
surveyed the collars of the Codelco drillholes.
MCSA supplied the topography as a DXF file of contour lines.
14.4 Geologic Model

MCSA created an oxidation surface in order to separate the sulfide portion of the deposit from the
oxidized portion. The top of the sulfide was determined based on points identified in the drillholes,
which were used to create the surface. Above the surface, the rock is predominately saprolite or soil.
Grade shells are used in block estimation to separate the units of mineralized breccia from the
unmineralized granite and to control grade estimation.
SRK, together with MCSA geologists, built the vertical sections and plan views at a cut-off of 0.2 %
Cu. 33 vertical sections were built with 25 m spacing and 77 plan views with 10 m spacing (Figure
14-2). The wireframes were created through the extrusion of plan views.
SRK reviewed the copper data in histogram, cumulative frequency and probability plots (Figure 14-3).
This review did not reveal two populations that would justify the construction of separate wireframes
for different ore types. SRK also reviewed the data visually and did not see a clear separation of
populations that justify any separation of ore types.
September 7, 2017
Figure 14-2: Vertical section 10000.
September 7, 2017
Figure 14-3: Copper histogram, cumulative frequency and probability plot from assay data.
Data inside ore wireframes.
14.5 Exploration Data Analysis

The raw Cu assay data was first plotted on histogram and cumulative distribution graphs to understand
the basic statistical distribution. The copper histogram for sulfide ore shows weak positive skewness
and the cumulative distribution curve illustrates a continuous population set with no distinct break in
slope (Figure 14-4). Table 14.5 presents statistics for the assays within the wireframes around sulfide
and secondary (oxide) ores.
September 7, 2017
Figure 14-4: Copper histogram and cumulative frequency graph from assays data. Data inside
the ore sulfide wireframes.
September 7, 2017
Table 14.5: Statistics of assay data within the ore wireframes.
Assay
Coef. of
Element Material Mean Std. Dev. Max. Min. Variance No. of Data
Var.
Secondary
415
Ore 0.93 1.35 1.46 12.90 0.00 1.82
Cu (%) Sulfide Ore 0.75 1.07 1.44 12.50 0.00 1.14 7,380
Waste 0.07 0.17 2.26 5.87 0.00 0.03 12,711
Dike 0.09 0.27 3.06 2.81 0.00 0.07 280
Secondary
408
Ore 9.46 7.53 0.80 50.60 0.92 56.70
Fe (%) Sulfide Ore 10.11 7.61 0.75 49.09 0.00 57.91 7,207
Waste 6.01 4.54 0.76 44.31 0.00 20.61 12,598
Dike 5.43 2.27 0.42 15.99 2.10 5.15 280
Secondary
415
Ore 175 327 2 3,300 3 107,007
Co Sulfide Ore 223 386 2 6,400 1 148,649 7,380
(ppm)
Waste 90 206 2 4,234 1 42,514 12,711
Dike 51 68 1 423 3 4,556 280
Secondary
363
Ore 94 393 4 5,400 1 154,331
Mo Sulfide Ore 88 556 6 25,000 1 309,325 3,978
(ppm)
Waste 36 210 6 10,001 1 44,100 9,027
Dike 23 187 8 2,930 1 34,958 279
Secondary
227
Ore 3.34 4.54 1.36 27.20 0.01 20.61
Sulfide Ore 4.07 5.57 1.37 41.62 0.00 31.02 4,870
S (%)
Waste 1.52 2.94 1.93 35.00 0.00 8.64 4,660
Dike 1.28 2.06 1.62 4.82 0.03 4.24 7
The purpose of compositing raw assay samples is to provide samples, or composites, of nearly equal
length for grade estimation. The average length of the ore samples is 1.74 m (Figure 14-5). SRK
selected 2 m as the compositing length. The raw assay data was composited from the top of the
drillhole at intervals of 2 m with breaks at the wireframe boundaries. Composites less than 1 m in
length were not used in statistical calculation or resource estimates. Table 14.6 presents the statistical
results of the composites within the wireframes for sulfide and secondary (oxide) ores.
September 7, 2017
Figure 14-5: Length cumulative frequency graph from assays data. Data inside ore
wireframes.
Table 14.6: Statistics of composite data within the ore wireframes.

Composites
Std. Coef.
Element Material Mean Max. Min. Variance No. of Data
Dev. of Var.
Secondary
Ore 0.93 1.19 1.29 8.22 0.01 1.42 353
Cu (%) Sulfide Ore 0.75 0.95 1.27 10.19 0.00 0.90 6,514
Waste 0.08 0.16 2.14 5.75 0.00 0.03 13,870
Dike 0.09 0.27 2.9 2.69 0.00 0.07 300
Secondary
Ore 9.46 7.21 0.76 43.4 1.30 51.98 348
Fe (%) Sulfide Ore 10.1 7.16 0.71 48.63 0.00 51.27 6,318
Waste 6.06 4.32 0.71 44.31 0.00 18.66 13,613
Dike 5.43 2.24 0.41 15.99 2.10 5.02 300
Secondary
Ore 175 308 2 2,900 3 95,141 368
Co Sulfide Ore 223 346 2 5,948 1 119,993 6,677
(ppm)
Waste 91 183 2 3,457 1 33,346 14,037
Dike 52 67 1 377 3 4,480 315
Secondary
Ore 94 330 4 4,051 1 108,999 309
Mo Sulfide Ore 89 495 6 19,300 1 244,857 3,573
(ppm)
Waste 37 181 5 9,198 1 32,703 9,007
Dike 23 185 8 2,930 1 34,273 312
Secondary
Ore 3.33 4.16 1.25 27.20 0.02 17.31 209
S (%) Sulfide Ore 4.07 5.04 1.24 38.71 0.00 25.40 4,637
Waste 1.56 2.67 1.71 31.48 0.00 7.13 6,542
Dike 1.27 2.01 1.59 4.82 0.03 4.04 9
September 7, 2017
An examination of Table 14.5 and Table 14.6 shows that the coefficient of variation for copper has
decreased in the composites. The average grade of the assays and composites for copper show a
similar trend.
As shown in Figure 14-6, the values of 6 % and 3 % copper were selected for grade control during the
sulfide and secondary ore estimation, respectively. The GEMS™ “high grade transition value” tool was
used to prevent smearing of high grades (detailed in Section 14.10).
Sulfide ore
Secondary ore
Figure 14-6: Copper probability plot from composites data. Data inside sulfide and secondary
ore (Oxide) wireframes.
September 7, 2017
14.6 Contact Analysis

SRK conducted a contact analysis between sulfide ore and sulfide waste using composites ≥1 m. The
study shows abrupt contact between the analyzed groups (Figure 14-7), defining both domains for the
purpose of conducting a statistical control.
Figure 14-7: Contact analysis between sulfide ore data and sulfide waste data.
September 7, 2017
14.7 Specific Gravity

The specific gravity (SG) database consists of 193 core sample measurements completed by Codelco
and 2,429 measurements completed by MCSA. MCSA also requested that the SGS Geosol and
Intertek laboratories take SG measurements on core pieces that MCSA had already measured. SGS
conducted the measurements twice, as their first data set was inconsistent with MCSA’s; the second
data set was closer but still inconsistent with MCSA’s and also inconsistent with their first set. The
SGS data were therefore considered unreliable. Intertek’s results were similar to MCSA’s, but returned
slightly higher results, as shown in Figure 14-8.
Sample Number
Figure 14-8: Comparison of SG results – MCSA vs. Intertek.
SRK created a database in GEMS™ and assigned oxidation codes to the data indicating their location
with respect to the grade shell and sulfide surface. Figure 14-9 shows plots of SG versus Cu+Fe
grades in the sulfide and secondary (oxide) ore/waste grade shells. SRK assigned SG values to the
block model based on the following conditions:
• Oxide outside grade shells: SG = 2.32 + (Cu + Fe) X 0.046;

• Oxide inside grade shells: SG = 2.65 + (Cu + Fe) X 0.023;
• Sulfide outside grade shells: SG = 2.68 + (Cu + Fe) X 0.038; and
• Sulfide inside grade shells: SG = 2.69 + (Cu + Fe) X 0.042.
September 7, 2017
Figure 14-9: Scatter plots of SG vs. Cu+Fe.
September 7, 2017
14.8 Variogram Analysis and Modeling

SRK calculated a variogram for the composite data, using a length of exactly 2 m, contained within the
sulfide grade shells. Figure 14-10 and Figure 14-11 show down the hole variograms for copper and
iron, respectively. Figure 14-12 and Figure 14-13 show the directional variograms used in the resource
estimation for copper and iron, respectively. The variogram parameters for copper and iron are given
in Table 14.7 and Table 14.8, respectively.
Figure 14-14 shows the copper search ellipses for sulfide ore in vertical section and plan view.
September 7, 2017
Figure 14-10: Down the hole variogram for copper (Sulfide Ore).
September 7, 2017
Figure 14-11: Down the hole variogram for iron (Sulfide Ore).
September 7, 2017
Figure 14-12: Directional variogram for copper (Sulfide Ore).
September 7, 2017
Figure 14-13: Directional variogram for iron (Sulfide Ore).
September 7, 2017
Table 14.7: Variogram parameters for copper (Sulfide Ore).

Sulfide Ore %Cu
2nd
Rotation Method Azimuth Dip
Azimuth
GEMS ADA: Azimuth (DIP direction Az), DIP, Azimuth (2nd
150 -60 60
direction)
Search Type Anisotropy Axes X' Y' Z'
Ranges (m) 62 62 27
Octant Range (1st search *) High grade transition
10 10 5
ranges - m (block size)
Ranges (m) 124 124 54
Range
Octant High grade transition
(2st search **) 10 10 5
Ranges (m) 186 186 81
Range
Ellipsoidal High grade transition
(3st search ***) 10 10 5
Model Sill Range X' Range Y' Range Z'
Variogram Nugget 0.10 - - -

Modeled 1st Sph 0.61 10.5 10.5 4.5
2nd Sph 0.38 65 65 28
Table 14.8: Variogram parameters for iron (Sulfide Ore).

Sulfide Ore %Fe
2nd
Rotation Method Azimuth Dip
Azimuth
GEMS ADA: Azimuth (DIP direction Az), DIP, Azimuth (2nd
150 -60 60
direction)
Search Type Anisotropy Axes X' Y' Z'
Ranges (m) 104 51 48
Octant Range (1st search *) High grade transition
10 10 5
Ranges (m) 208 102 96
Range
Octant High grade transition
(2st search **) 10 10 5
Ranges (m) 312 153 144
Range
Ellipsoidal High grade transition
(3st search ***) 10 10 5
Model Sill Range X' Range Y' Range Z'
Variogram Nugget 0.63 - - -

Modeled 1st Sph 39.05 40.2 19.7 18.9
2nd Sph 10.59 110.1 54 51.6
September 7, 2017
Figure 14-14: Copper search ellipses (Sulfide Ore).
14.9 Block Model

A GEMS™ percentage block model was created with rotation at an azimuth angle of 030°. Figure
14-15 shows the characteristics of the block model. Figure 14-16 shows the wireframes and an outline
of the block model in section view.
September 7, 2017
Figure 14-15: Block model origin and dimensions.
Figure 14-16: Wireframes with block model outline in section view.
September 7, 2017
14.10 Estimation Methodology

The sulfide blocks were estimated using OK in three passes with a search ellipsoid oriented at
N060°E/60°SE.
The copper and iron estimation parameters for the three passes are shown in Table 14.9.
Table 14.9: Summary of estimation parameters.

Number of Composites Search Type & Parameters Range (meter)
Estimation
Pass Max. Comps / Octant Min. No. Max. Data
Min. Max. X Y Z
Borehole Search Octants / Octant
Cu (Secondary and Sulfide Ore )
1 4 8 3 Yes 4 2 62 62 27
2 4 8 3 Yes 4 2 124 124 54
3 2 8 1 No − − 186 186 81
Fe (Secondary and Sulfide Ore )
1 4 8 3 Yes 4 2 104 51 48
2 4 8 3 Yes 4 2 208 102 96
3 2 8 1 No − − 312 153 144
To prevent smearing of high grades, the GEMS™ “high grade transition value” tool was used. Values
of 6 % and 3 % copper were used for grade control during the sulfide and secondary ore estimation,
respectively. This tool limits the use of high values to a specific search ellipse; in this case the limitation
used was the size of the block (10 m x 10 m x 5 m).
For other elements (S, Mo and Co), the same copper estimation parameters were used.
The secondary ore (oxide) blocks were estimated using the inverse distance squared (ID2) with
parameters similar to those used in OK. The difference in the ID2 was that the search ellipsoid was
relatively flat (horizontal). The composites used during the Mineral Resource estimation were those
within the wireframes of ≥1 m in length.
A second estimate was run for blocks outside the ore wireframes for later use as dilution in mine
planning. The estimation methodology was the same as described above, excepting the use of the
composites outside the ore wireframes.
14.11 Model Validation

The block model was validated using three methodologies:
• Swath plots between blocks (OK) and the nearest neighbor estimate (NN);
• Comparison of statistics for blocks and composites; and
• Visual comparison via vertical and horizontal sections.
The swath plots compare the OK and NN estimates using only Measured and Indicated Mineral
Resources in 50 m bands from south to north, east to west and in 10 m bands by elevation. Figure
14-17 shows the swath plots.
The swath plots demonstrate good agreement between nearest neighbor estimates and block grades,
with the block grades being slightly smoothed in all three sets.
September 7, 2017
The statistic comparison between blocks and composites (Table 14.10) shows that the block grades
are lower than the composite grades.
Table 14.10: Comparison between composite and block Cu grades (Sulfide Ore).
Sulfide
Statistic
Composite Block
Average 0.75 0.68
Minimum 0.001 0.03
Maximum 10.19 5.51
Std Dev 0.95 0.4
Coef. of Var. 1.27 0.58
Number of Samples 6,514 85,507
Block grades were compared to composite grades in cross-sections. The comparison showed good
agreement between block and composite grades. Figure 14-18 and Figure 14-19 show typical cross-
sections.
September 7, 2017
Figure 14-17: Swath plots between OK and NN (Sulfide Ore).
September 7, 2017
September 7, 2017
September 7, 2017
14.12 Resource Classification

The Mineral Resources are classified under the categories Measured, Indicated and Inferred
according to CIM guidelines. The classification of the Mineral Resources reflects the relative
confidence in the grade estimates. This classification is based on several factors, including sample
spacing relative to geological and geo-statistical observations regarding the continuity of
mineralization, data verification to original sources, specific gravity determinations, accuracy of drill
collar locations, accuracy of topographic surface, quality of the assay data and many other factors,
which influence the confidence in the mineral estimation. No single factor controls the resource
classification rather each factor influences the end result.
Table 14.11 shows the estimation summary. All secondary ore (oxide) blocks were classified as
Inferred.
Table 14.11: Estimation summary for sulfide material.
Number of
Anisotropic Distance Neighborhood
Cu Samples for
(Mean Distance - Cu) (Kriging Pass - Cu)
Estimation (Cu)
Resource Block Std.
Min. Max. Mean Min. Max. Mean Min. Max. Mean Min. Max. Mean
Classification Number Dev.
1 (Measured) 40,123 0.03 5.51 0.75 0.44 4 8 7.52 0.56 60.09 21.5 1 1 1
2 (Indicated) 40,689 0.03 5.22 0.6 0.34 4 8 7.81 0.25 61.99 32.07 2 3 2.17
3 (Inferred) 4,695 0.03 2.89 0.64 0.4 2 8 7.87 62 197.19 82.91 2 4 2.68
14.13 Mineral Resource Statement

The Mineral Resources are constrained to a pit optimization shell run with the following parameters:
• Copper price: US $4.00 per pound;

• Mining cost: US$2.25/t moved;
• Processing cost + G&A: US$8.21/t processed;
• TC/RC: US$0.32/lb copper; and
• Recovery: 91 %.
The internal copper CoG (excluding mining costs) is 0.20% Cu.
The Measured, Indicated and Inferred Resources within the pit optimization shell are given in Table
14.12. The copper grades shown are undiluted grades within the grade shell wireframes.
September 7, 2017
Table 14.12: Mineral Resource statement, Boa Esperança Copper Project, Pará State, Brazil,
SRK Consultores do Brasil LTDA., June 1, 2017
(Mt) (tonnes)
Measured 41.00 0.81 332,100
Indicated 26.17 0.62 162,254
Sulfide
Inferred 1.35 0.56 7,560
Secondary
Inferred 2.05 0.69 14,145
Sulfide
Total Measured 41.00 0.81 332,100
Indicated 26.17 0.62 162,254
Inferred 3.40 0.64 21,760
Source: SRK
Mineral Resources are not Mineral Reserves and have not demonstrated economic viability. Mineral
Resource estimates do not account for mineability, selectivity, mining loss and dilution. These Mineral
Resource estimates include Inferred Mineral Resources that are normally considered too geologically
speculative to allow for the application of economic considerations that would see them categorized
as Mineral Reserves. There is also no certainty that these Inferred Mineral Resources will be converted
to Measured and Indicated categories through further drilling or into Mineral Reserves once economic
considerations have been applied.
September 7, 2017
14.14 Mineral Resource Sensitivity

Grade tonnage curves for combined Measured and Indicated sulfide Mineral Resources, Inferred
sulfide Mineral Resources and Inferred secondary (oxide) Mineral Resources are shown in Figure
14-20, Figure 14-21 and Figure 14-22.
Boa Esperança Project - Grade Tonnage: Sulfide Measured + Indicated
80.0
68.3 67.1 0.72

70.0
0.73
60.0
Mean (%Cu) x
51.5
RESOURCES (MT)
0.86
Resouces (Mt)
50.0
40.0
1.04
34.9 Cutoff (%Cu) x
30.0 Resources (Mt)
22.4
1.22
20.0
1.41
14.3
10.0 8.9 1.60
1.81 2.02
5.4 2.24 2.62
3.2 1.9 1.7
0.0
0.0
0.2
0.4
0.6
0.8
1.0
1.2
1.4
1.6
1.8
2.0
2.2
2.4
2.6
2.8
3.0
CUTOFF (%CU)
Figure 14-20: Grade Tonnage - Sulfide Measured and Indicated.

Boa Esperança Project - Grade Tonnage: Sulfide Inferred
2.00
1.80
1.60
1.36 0.56 Mean (%Cu) x
1.40
RESOURCES (MT)
1.35 Resouces (Mt)

1.20
1.00 0.90
0.70 Cutoff (%Cu) x
0.80
Resources (Mt)
0.60
0.45 0.91
0.40
1.07
0.20 0.25
1.20
0.14 1.57
0.00 0.079
0.0
0.2
0.4
0.6
0.8
1.0
1.2
1.4
1.6
CUTOFF (%CU)
Figure 14-21: Grade Tonnage - Sulfide Inferred.
September 7, 2017
Boa Esperança Project - Grade Tonnage: Oxide (Secondary Ore) Inferred
2.14 0.67
2.20
2.05 0.69
2.00
1.80
1.60 Mean (%Cu) x

RESOURCES (MT)
Resouces (Mt)
1.40
1.19
1.20 0.97
1.00 Cutoff (%Cu) x
0.85 1.16
0.80 Resources (Mt)
1.34
0.60 0.61
1.47
0.40 0.48
1.64
0.20 0.32 1.81 2.01 2.84
0.20
0.13 0.11
0.00
0.0
0.2
0.4
0.6
0.8
1.0
1.2
1.4
1.6
1.8
2.0
2.2
2.4
2.6
2.8
3.0
CUTOFF (%CU)
Figure 14-22: Grade Tonnage - Secondary Ore Inferred (Oxide).
September 7, 2017
15 Mineral Reserve Estimates

15.1 Reserve Estimation
The conversion of Mineral Resources to Mineral Reserves requires accumulated knowledge achieved
through pit optimization, pit design, economics and associated modifying parameters.
The mineable reserve was calculated based on a cut-off grade of 0.28% Cu and a life of mine (LoM)
copper price of US$ 7,000/t LME Cu.
In accordance with the CIM classification guidelines, only Measured and Indicated Mineral Resource
categories are converted to Proven and Probable Mineral Reserves respectively (through inclusion
within the open-pit mining limits). Inferred Mineral Resources are treated as waste with an assigned
grade of zero.
15.2 Reserve Statement

Table 15.1 shows the Boa Esperança mine open pit Mineral Reserve statement.
September 7, 2017
Table 15.1: Mineral Reserve Estimate for the Boa Esperança copper deposit, State of Para,
Mineral
Dry Contained
Reserve Volume Density Cu
Tonnage Cu
Classification
m3 x 1,000 t/m3 t x 1,000 % t x 1,000
Proven 5,744.50 3.225 18,528.1 0.96 178.05
Probable 315.6 3.089 975.0 0.72 7.02
Total 6,060.10 3.218 19,503.1 0.95 185.07
• Open pit Mineral Reserves assume full mine recovery;

• Open pit Mineral Reserves are diluted along lithological boundaries and assume selective mining unit of 2.5 m x 2.5
m x 5 m;
• The strip ratio was calculated to be 1.93 (waste to ore);
• Reserves are based on a price of US$ 7,000/t LME Cu throughout the life of the mine;
• Reserves are based on a cut-off grade of 0.28% Cu;
• Mineral Resource tonnage and contained metal have been rounded to reflect the accuracy of the estimate. As a result
of this rounding, the numbers may not add up;
• Contained copper is reported as in-situ and does not include process recovery; and
• The Mineral Reserve estimate was calculated by Rubens Mendonça, BSc, MBA, Chartered Professional Member of
the AusIMM, Mining Manager of SRK Consultores do Brasil, in accordance with the standards set out in CSA, NI 43-
101 and generally accepted CIM “Estimation of Mineral Resource and Mineral Reserves Best Practices” guidelines.
September 7, 2017
16 Mining Methods
16.1 Project Data and Criteria
The following basic data and project criteria were used by SRK for the development of the mine
component of the Boa Esperança Project.
Mineral Resources
The Mineral Resources for the Boa Esperança copper deposit, following the last review by SRK (June,
2017), are shown in Table 16.1.
Table 16.1: Mineral Resource Statement.

(Mt) (tonnes)
Measured 41.00 0.81 332,100
Indicated 26.17 0.62 162,254
Sulfide
Inferred 1.35 0.56 7,560
Secondary
Inferred 2.05 0.69 14,145
Sulfide
Total Measured 41.00 0.81 332,100
Indicated 26.17 0.62 162,254
Inferred 3.40 0.64 21,760
Source: SRK
Topography
The topography file used by SRK for the final pit optimization was provided by MCSA
(topografia_mcsa.dxf) and covers an area of 16.3 km2, with contour lines at 5 m intervals.
Tenement and Property Boundaries
The property limits and tenement boundaries of the Boa Esperança project (DNPM process number
855.815/1996) are shown in Figure 16-1.
September 7, 2017
Mining Rights
Limit
855815/1996
Property Limit
Figure 16-1: Boa Esperança’s property and tenement boundaries.
Densities
The densities of all materials have been estimated based on the Cu and Fe content of each block,
according to the following formula:
Density (dry) = 2.69 + (Cu% + Fe%) * 0.042
Production Rate
The Boa Esperança project aims to produce copper concentrate with a Cu content of 26%. An average
of 2.3 Mtpy of ROM will feed the crusher and pre-concentration stage, producing nearly 1.5 Mtpy of
ore to be fed to the plant for the subsequent milling and flotation stages.
Concentration Process
The processing route used in this current review of the Boa Esperança BFS is illustrated in Figure
16-2. After the pre-concentration stage with jigging, the ore is ground and then concentrated by
flotation.
September 7, 2017
Figure 16-2: Concentration Process.
Mass and Metallurgical Recovery
Pre-concentration mass recovery: 53.7%
Pre-concentration metallurgical recovery: 89.33%
Flotation metallurgical recovery: Table 16.2.
Overall metallurgical recovery: 87.4%.
Table 16.2: Flotation metallurgical recovery.
Flotation Metallurgical Recovery

Metal. Recovery
Grade (%)
Cu > 1.40 94.0
1.0 < Cu < 1.40 92.7
0.7 < Cu <1 90.7
0.5 < Cu < 0.7 86.4
0.27 < Cu < 0.5 80.0
Cut-off Grade
Ore cut-off grade: 0.28% Cu
Marginal grade material: 0.24% Cu
Low-grade material (0.28 > Cu% < 0.40) will be stockpiled over the life of the Project in order to be fed
to the beneficiation plant after the mine production period has ceased.
The (0.24 > Cu% < 0.28) will also be stockpiled, but processing has not been considered in this
Feasibility Study.
September 7, 2017
Final Pit Geometry
Table 16.3 summarizes the geometric parameters of the Boa Esperança final pit design.
Table 16.3: Final pit geometry’s parameters.
Lithologies Saprolite Weathered Fresh

Bench Height 10 10 10
Catch Bench Width 7 5 5
Face Angle 45 70 83
Ramp Width (2-way) 13.0 13.0 13.0
Inter Ramp Angle 31.5 49.0 58.0
Overall Slope Angle 29.6 45.0 53.0
Mine Recovery and Ore Dilution
Mine recovery (for the purpose of reserve estimate): 94%
Ore dilution: 5.7%. The ore dilution was applied to the block model and calculated considering the
dilution of ore blocks in contact with waste blocks, the grades of which were also estimated during the
grade estimation process.
Production costs
• Ore Concentration rate: CR = concentrate grade / (ore grade * overall recovery) = 26 / (0.95 *
0.8741) = 31.3
• Mining Cost (R$ / t) = R$ 5.80 (saprolite); 7.78 (weathered and fresh rock)
• Additional Stockpile Cost = RS$ 1.58 /t material
• Crushing Cost = R$ 7.78/t processed
• Pre-concentration Process (Jigging) = R$ 1.58 /t processed
• Milling/Flotation Cost = R$ 18.11 /t processed
• G&A = R$ 25.2 million/year / 2.3 million tonnes = R$ 10.96 /t
• Logistics = R$ 441 / t of concentrate
• TC / RC = R$ 1.01 / lb Cu
• C1 cost = R$ 1900.71 / t of concentrate or R$ 3.31 / lb Cu
Economic Parameters
• US$ 7,000 /t (LME)

• Royalties (CFEM): 2%
• Discount rate: 12% p.a.
• Taxes: 34% (25% Income Tax plus 9% CSLL)
Mine Road Design Parameters
September 7, 2017
• Maximum Ramp: 10%

• Road width: 13 m
16.2 Pit Slope Geotechnical Evaluation and Final Pit Geometry

Review
This section comprises the review of the final pit slopes of the Boa Esperança project and a
comparison with the slopes presented by SRK-US in a previous report (Project Number 175600 020 -
November, 2012). It considers the changes in the dimensions of the new pit designed by MCSA, as
well as a review of the geological model and the availability of a new geotechnical drilling plan.
16.2.1 Project Configuration

The configuration of the pit designed by MCSA in 2014 is shown in Figure 16-3.
Figure 16-3: Plane view pit showing the analyzed sections
The sections studied in this report are shown in Figure 16-4 and Figure 16-5, and represent sections
A-A and B-B respectively.
September 7, 2017
Figure 16-4: Section A-A
Figure 16-5: Section B-B
The geometry presented above has typical benches with slope inclination angles defined according to
the above-mentioned report, such as:
- Excavated bench in fresh rock (Figure 16-6):
September 7, 2017
Figure 16-6: Fresh rock bench geometry

• Slope face angle: 73o
• Bench height: 10.0 meters
• Berm width: 5.0 meters
- Excavated bench in saprolite (Figure 16-7):
Figure 16-7: Saprolite bench geometry

• Slope face angle: 50o
• Bench height: 10.0 meters
• Berm width: 12.6 meters
September 7, 2017
16.2.2 Material Parameters

Three horizons of different materials were considered in this study, based on the drilling bulletins
(BSPD-107 and BSPD-108) presented in the SRK-US (2012) report. These materials are called
saprolite, weathered rock and fresh rock.
The strength parameters used for saprolite were defined according to the Mohr-Coulomb criteria,
adopting the strength parameters for shearing, c and ᵩ. The Howk-Brown criteria were used for
weathered and fresh rocks, adopting the Uniaxial Compressive Strength (UCS) parameters, m, s,
(constants defined from the type of material). Table 16-4 lists the values used in this study.
Table 16-4: Strength parameters
Specific
Cohesion UCS
Material Weigth ᵩ (°) m s
(kPa) (kPa)
ᵞ (kN/m³)
Saprolite 20 15 33 - - -
Wheatered Rock - - - 40.000 1,33 0,00029
Fresh Rock - - - 113.707 1,33 0,00029
16.2.3 Methodology
This study was conducted using Slide 6.0 software, which is a 2D program that makes use of the limit
equilibrium method. In this type of analysis, the existence of a defined rupture surface is assumed and
the constant safety coefficient, specific to rupture potential surface taken into consideration. The
Simplified Bishop method was adopted as the method of analysis.
In addition to the stability study between benches, RocPlane software was used to analyze the planar
rupture of a bench that had been given a rupture surface angle.
First a back analysis study was conducted (Study 1) to validate the parameters used in the SRK-US
(2012) study. Thereafter, sections A-A and B-B were completed using the following studies and their
respective minimum Safety Factor (SF). Slope angles from the previous study were also used.
• Study 2 - Stability between berms (Circular Rupture) – Applying the geometry proposed by
MCSA – SF (minimum) – 1.50
• Study 3 - Stability between berms (Planar Rupture) – Applying the geometry proposed by
• Study 4 – A-A Section, Left Slope – Global Stability - Applying the geometry proposed by
• Study 5 – A-A Section, Right Slope – Global Stability - Applying the geometry proposed by
• Study 6 – B-B Section, North Slope – Global Stability - Applying the geometry proposed by
MCSA – SF (minimum) – 1.50 – Left Pit
• Study 7 – B-B Section, East Slope – Global Stability - Applying the geometry proposed by
September 7, 2017
In order to continue the study and optimize the pit geometry presented by MCSA, a new analysis was
performed for different face slope angles, for the three different materials (saprolite, weathered rock,
and fresh rock). As a result, it is possible to define the angle that ensures the safety of the excavation
with the steepest slopes, as follows:
• Study 8 - Stability between berms (Planar Rupture) – Applying the steepest slope to
weathered rock – SF (minimum) – 1.50
• Study 9 - Stability between berms (Planar Rupture) – Applying the steepest slope to fresh
rock – SF (minimum) – 1.50
• Studies 10, 11 and 12 – A-A Section – Global Stability - Applying the geometry proposed by
SRK-BR – SF (minimum) – 1.50
• Studies 12 and 13 – B-B Section – Global Stability - Applying the geometry proposed by SRK-
BR – SF (minimum) – 1.50
16.2.4 Results
The results of the final pit geometry review are shown below (Figure 16-8 to Figure 16-20).
Figure 16-8: Study 1
September 7, 2017
September 7, 2017
September 7, 2017
September 7, 2017
September 7, 2017
September 7, 2017
Table 16-5 shows the results for each study.
September 7, 2017
Table 16-5: Results of stability analyses
Safety Factors - SF
Studies
Simplified Bishop Planar Rupture Minimum
Study 1 1,70 1,5
Study 2 5,60 1,5
Study 3 4,10 1,5
Study 4 2,04 1,5
Study 5 0,86 1,5
Study 6 2,39 1,5
Study 7 2,30 1,5
Study 8 1,71 1,5
Study 9 3,29 1,5
Study 10 1,51 1,5
Study 11 1,64 1,5
Study 12 2,47 1,5
Study 13 2,35 1,5
16.2.5 Conclusions and Recommendations

Based on the Planer Rupture models between berms performed in studies 8 and 9, steeper angles for
the excavated slopes in the weathered and fresh rocks have been proposed. However, for the
saprolite, a shallower angle is recommended, as this material forms a less cohesive soil and is more
likely to fail at steep slope face or inter-ramp angles.
Table 16-6 shows the slope geometry proposed by SRK for each type of material.
Table 16-6: Proposed angles for each type of material
Saprolite Weathered Rock Fresh Rock
Bench Heigth 10,0 m 10,0 m 10,0 m
Berm Width 7,0 m 5,0 m 5,0 m
Slope Face Angle 45º 70º 83º
Inter-Ramp Angle 31,5º 49º 58º
September 7, 2017
16.3 Final Pit Optimization and Design

16.3.1 Final Pit Optimization
Pit shells were generated for a range of revenue factors and in accordance with the geotechnical
framework. Only Measured and Indicated Mineral Resources were considered for inclusion in the pit
design. Where unavoidably mined, Inferred Mineral Resources were assigned zero grade. A summary
of the optimization results is shown in Table 16.7 and Table 16.8.
Table 16.7: Pit optimization summary. *

Optimization pit summary
Minimum Maximum Rock Ore Strip Max Min Cu Cu

Pit Rev Ftr Rev Ftr Tonnes Tonnes Ratio Bench Bench Units Grade
1 0.440 0.440 27,841,682 6,159,828 3.52 156 103 8,199,767 1.33
2 0.460 0.460 34,775,068 8,494,756 3.09 156 102 10,609,539 1.25
3 0.480 0.480 37,872,304 9,546,823 2.97 156 99 11,601,587 1.22
4 0.500 0.500 39,987,671 10,423,756 2.84 156 99 12,318,297 1.18
5 0.520 0.520 47,958,120 13,058,723 2.67 156 93 14,536,848 1.11
6 0.540 0.540 51,289,990 14,435,132 2.55 156 92 15,549,521 1.08
7 0.560 0.560 52,589,718 15,135,994 2.47 156 91 15,984,911 1.06
8 0.580 0.580 54,538,842 16,022,219 2.40 156 89 16,546,768 1.03
9 0.600 0.600 55,808,447 16,670,018 2.35 156 89 16,923,997 1.02
10 0.620 0.620 57,266,237 17,406,973 2.29 156 89 17,336,086 1.00
11 0.640 0.640 58,828,143 18,111,234 2.25 156 89 17,722,242 0.98
12 0.660 0.660 60,072,557 18,635,260 2.22 156 89 18,004,845 0.97
13 0.680 0.680 64,749,819 20,271,101 2.19 156 86 18,914,998 0.93
14 0.700 0.700 69,060,909 21,662,028 2.19 156 86 19,690,159 0.91
15 0.720 0.720 75,174,782 23,816,700 2.16 156 85 20,807,580 0.87
16 0.740 0.740 76,609,163 24,575,215 2.12 156 84 21,132,190 0.86
17 0.760 0.760 86,903,859 28,310,466 2.07 156 82 22,926,638 0.81
18 0.780 0.780 105,338,507 34,091,134 2.09 156 67 25,852,970 0.76
19 0.800 0.800 142,819,398 42,936,954 2.33 156 58 30,865,152 0.72
20 0.820 0.820 147,423,889 44,651,174 2.30 156 57 31,630,282 0.71
21 0.840 0.840 152,137,711 46,375,795 2.28 156 56 32,377,347 0.70
22 0.860 0.860 155,979,074 47,813,950 2.26 156 55 32,980,287 0.69
23 0.880 0.880 158,923,970 49,041,630 2.24 156 55 33,457,915 0.68
24 0.900 0.900 164,930,633 51,139,316 2.23 156 55 34,311,401 0.67
25 0.920 0.920 167,094,816 52,291,140 2.20 156 55 34,698,848 0.66
26 0.940 0.940 193,033,016 57,159,801 2.38 156 51 37,367,004 0.65
27 0.960 0.960 197,711,414 58,717,323 2.37 156 51 37,946,379 0.65
28 0.980 0.980 199,553,667 59,719,116 2.34 156 51 38,256,540 0.64
29 1.000 1.000 206,412,731 61,577,899 2.35 156 51 39,018,301 0.63
30 1.020 1.020 213,185,265 63,129,887 2.38 156 49 39,698,364 0.63
31 1.040 1.040 215,626,385 64,066,366 2.37 156 49 39,997,442 0.62
32 1.060 1.060 218,707,147 65,098,655 2.36 156 49 40,345,599 0.62
33 1.080 1.080 221,108,934 66,096,196 2.35 156 49 40,653,556 0.62
34 1.100 1.100 223,231,574 66,933,303 2.34 156 49 40,907,132 0.61
35 1.120 1.120 230,346,060 68,737,388 2.35 156 41 41,625,920 0.61
36 1.140 1.140 239,089,385 70,613,385 2.39 156 41 42,320,689 0.60
37 1.160 1.160 245,636,618 72,248,646 2.40 156 41 42,897,598 0.59
38 1.180 1.180 247,345,560 72,988,077 2.39 156 41 43,094,194 0.59
39 1.200 1.200 248,773,524 73,679,228 2.38 156 41 43,263,912 0.59
* Tonness and grades on dry basis.

Only material above cut-off (marginal material not included)
September 7, 2017
Table 16.8: Economic results of pit optimization. *

Pit by Pit Results
Grand totals:
Open pit Open pit Open pit Mine Mine Mine Undiscounted Open pit
cashflow cashflow cashflow tonne Waste life life life Open pit cashflow
Final best specified worst input best years years years cashflow average
pit $ disc $ disc $ disc best tonne best specified worst $ $ disc
1 194,423,764 196,479,398 194,423,764 7,247,944 20,593,778 4.79 8.00 4.79 306,641,835 194,423,764
2 237,670,527 232,379,891 225,216,855 9,955,448 24,819,680 5.97 7.03 6.16 393,011,559 231,443,691
3 253,510,424 246,007,848 236,347,492 11,261,256 26,611,109 6.53 6.65 6.76 426,533,188 244,928,958
4 262,473,407 254,370,233 243,026,982 12,156,921 27,830,822 6.92 7.04 7.17 447,684,981 252,750,195
5 291,054,338 279,955,748 260,082,383 15,729,398 32,228,793 8.47 8.59 8.77 521,181,752 275,568,361
6 300,935,542 288,356,832 265,339,663 17,349,927 33,940,129 9.17 9.29 9.48 551,112,517 283,137,603
7 303,973,021 290,774,563 266,816,759 17,861,973 34,727,811 9.39 9.51 9.71 560,178,767 285,394,890
8 308,094,136 293,746,470 268,690,422 18,691,550 35,847,358 9.75 9.87 10.07 573,424,665 288,392,279
9 310,369,078 295,432,329 269,730,662 19,211,366 36,597,151 9.98 10.10 10.30 581,312,572 290,049,870
10 312,989,838 297,206,336 268,439,565 19,823,850 37,442,471 10.24 10.36 10.62 589,794,817 290,714,702
11 315,230,583 298,406,244 267,376,195 20,430,921 38,397,298 10.51 10.63 10.92 597,435,242 291,303,389
12 316,553,599 298,756,755 265,601,956 20,799,113 39,273,514 10.67 10.79 11.13 602,168,579 291,077,778
13 321,485,060 300,097,606 259,461,645 22,710,002 42,039,916 11.49 11.61 12.05 621,017,002 290,473,353
14 324,996,900 300,103,545 252,637,951 24,250,989 44,810,062 12.16 12.28 12.84 635,769,624 288,817,426
15 329,434,941 300,063,487 246,268,138 26,667,687 48,507,267 13.21 13.33 14.00 656,021,523 287,851,540
16 330,305,831 300,096,068 245,528,537 27,216,767 49,392,555 13.45 13.57 14.25 660,257,650 287,917,184
17 335,354,940 299,631,467 239,887,634 31,545,681 55,358,342 15.32 15.46 16.21 689,409,341 287,621,287
18 340,605,707 300,904,564 239,402,654 38,422,741 66,915,895 18.30 18.44 19.20 731,668,466 290,004,181
19 344,774,169 291,082,735 208,446,753 48,076,396 94,743,155 23.59 22.62 23.87 797,844,288 276,610,461
20 345,186,171 289,950,065 206,033,853 49,323,577 98,100,476 24.13 23.16 24.45 805,431,166 275,610,012
21 345,556,892 288,661,971 203,771,031 50,496,156 101,641,700 24.64 23.67 24.98 811,799,752 274,663,962
22 345,795,248 287,163,775 200,369,064 51,416,232 104,562,970 25.04 24.07 25.42 816,345,471 273,082,156
23 345,947,765 286,052,248 198,802,661 52,054,675 106,869,452 25.34 24.37 25.72 819,097,291 272,375,213
24 346,189,910 283,440,490 194,990,452 53,687,662 111,243,110 26.02 25.14 26.47 824,050,421 270,590,181
25 346,264,370 282,532,807 193,222,263 54,309,230 112,785,710 26.29 25.42 26.76 825,544,671 269,743,317
26 346,416,095 273,715,848 183,318,846 58,780,506 134,252,547 29.61 27.51 28.77 838,134,702 264,867,471
27 346,419,268 271,165,995 176,701,171 59,825,549 137,885,902 30.07 28.07 29.35 839,729,137 261,560,220
28 346,429,460 270,278,596 175,193,719 60,236,837 139,316,868 30.24 28.28 29.55 840,084,926 260,811,590
29 346,436,933 267,344,604 170,359,156 61,577,988 144,834,777 30.99 28.93 30.20 840,547,597 258,398,045
30 346,428,270 264,918,178 167,996,363 62,588,407 150,596,883 31.74 29.60 30.65 840,254,100 257,212,317
31 346,416,589 263,262,891 164,985,455 62,998,971 152,627,431 32.03 29.85 30.88 839,815,005 255,701,022
32 346,396,189 261,368,413 161,910,662 63,520,365 155,186,785 32.36 30.15 31.15 839,044,310 254,153,426
33 346,373,063 260,471,673 160,719,085 64,019,007 157,089,941 32.62 30.41 31.39 838,110,337 253,546,074
34 346,350,194 259,286,976 159,041,657 64,360,231 158,871,372 32.86 30.62 31.56 837,136,649 252,695,926
35 346,254,049 257,383,042 156,422,556 65,649,664 164,696,433 33.65 31.26 32.16 832,936,630 251,338,303
36 346,144,111 251,053,783 145,666,463 66,980,052 172,109,356 34.62 32.29 32.94 827,789,363 245,905,287
37 346,051,509 248,265,297 141,032,973 68,031,993 177,604,671 35.38 32.94 33.51 823,040,068 243,542,241
38 346,027,032 247,495,775 139,854,859 68,313,135 179,032,495 35.54 33.13 33.66 821,696,842 242,940,946
39 346,006,086 246,769,923 138,706,397 68,544,974 180,228,623 35.70 33.30 33.79 820,506,626 242,356,242
* Tonnes and grades on dry basis
September 7, 2017
The results from Table 16.8 are shown in the graph in Figure 16-21.
Figure 16-21: Pit optimization results.
Pits 8 to18 present the highest NPV. Pit 8 has approximately 16 Mt of ore and only 6.9 years of mine
life, while pit 18 has 34 Mt of ore, with a lifetime of nearly 15 years. The variation in NPV between
these pits is only around 2%. Therefore, there is no substantial financial benefit that would justify
moving a large amount of material (ore and waste).
Pit 11 features the best option because it has a lifetime in excess of 7 years (not including the pre-
production period), and a rising incremental value.
It is important to note that the selection of the final pit is dependent on the sale price of copper. Periodic
reviews should therefore be carried out to improve the economics of the project. A higher copper price
may enable a larger final pit shell, when the remaining deposit shows grades that are close to the
economic cut-off grade.
The final pit selected was pit 11, which accounts for the tonnages and grades summarized in Table
16.9.
September 7, 2017
Table 16.9: Selected unscheduled final pit design (floated cone)
Volume Density Tonnes Cu Fe Co Mo S

m3 x
1000 t/m3 t x 1000 % % ppm ppm %
High Grade Material
(Cu > 0.40) 5,657.0 3.23 18,288.6 1.01 12.20 331.81 88.91 5.13
Low Grade Material
(0.28 > Cu < 0.40) 672.0 3.06 2,057.4 0.34 8.90 221.77 79.16 3.22
Total Ore 6,329.0 3.21 20,346.0 0.94 11.87 320.69 87.92 4.94
Waste < marginal grade 1,173.5 2.96 3,470.6
Other Waste 12,464.3 2.80 34,893.7
Total Waste 13,637.8 2.81 38,364.3
Total (Ore + Waste) 19,966.8 2.94 58,710.2
Stripping Ratio
Including Low Grade Material 1.89
Excluding Low Grade Material 2.10
16.3.2 Final Pit Design

The process of final pit design led to the results in Table 16.10 and the configuration shown in the
plane and vertical sections in Figure 16-22.
September 7, 2017
Table 16.10: Summary of the designed final pit.
Bench Ore Waste Stripping Ratio

High Grade Ore Low Grade Ore Total Ore
Saprolit Weathered Fresh Incl. Excl.
e Rock Rock LGO LGO
tx1000 Cu % tx1000 Cu % tx1000 Cu % tx1000 tx1000 tx1000 t/t t/t

460 0 - 0 - 0.0 - 57.6 0.0 0.0 - -
450 0 - 0 - 0.0 - 326.3 0.0 0.0 - -
440 0 - 0 - 0.0 - 650.0 0.0 0.0 - -
430 0 - 0 - 0.0 - 990.6 0.0 0.0 - -
420 0 - 0 - 0.0 - 1,323.4 0.0 0.0 - -
410 0 - 0 - 0.0 - 1,584.8 0.0 0.0 - -
400 0 - 0 - 0.0 - 1,836.6 34.8 0.0 - -
390 0 - 0 - 0.0 - 2,020.4 167.0 0.0 - -
380 0 - 0 - 0.0 - 2,071.2 415.0 0.0 - -
370 0 - 0 - 0.0 - 1,754.5 974.7 0.0 - -
360 0 - 0 - 0.0 - 873.0 1,559.1 0.0 - -
350 124.1 0.85 15.6 0.33 139.7 0.79 769.7 1,633.6 44.8 17.53 19.73
340 485.7 1.00 77.2 0.35 562.9 0.91 862.4 1,000.5 401.1 4.02 4.66
330 798.3 1.10 117.2 0.34 915.6 1.01 914.7 622.3 565.2 2.30 2.63
320 1,185.6 1.07 131.0 0.34 1,318.2 0.99 951.0 485.6 431.0 1.42 1.58
310 1,462.6 1.10 82.7 0.34 1,546.9 1.05 964.5 360.7 486.9 1.17 1.24
300 1,443.9 1.08 99.1 0.34 1,544.5 1.03 875.5 381.7 613.0 1.21 1.30
290 1,482.2 1.06 102.6 0.35 1,586.3 1.01 567.9 477.4 670.8 1.08 1.16
280 1,501.5 1.06 86.8 0.34 1,588.3 1.02 148.7 541.7 688.3 0.87 0.92
270 1,474.4 1.04 184.6 0.34 1,661.9 0.96 40.9 216.9 800.7 0.64 0.72
260 1,446.1 0.99 184.8 0.34 1,637.0 0.91 7.5 38.4 755.8 0.49 0.55
250 1,149.8 0.97 185.5 0.34 1,336.5 0.88 0.0 0.0 769.8 0.58 0.67
240 987.8 0.85 146.7 0.35 1,140.6 0.79 0.0 0.0 658.6 0.58 0.67
230 856.2 0.91 160.6 0.34 1,019.9 0.82 0.0 0.0 535.3 0.52 0.63
220 629.4 0.98 136.3 0.34 765.7 0.86 0.0 0.0 441.7 0.58 0.70
210 559.2 0.96 82.2 0.35 641.4 0.88 0.0 0.0 388.5 0.61 0.69
200 484.5 1.02 64.1 0.34 548.6 0.94 0.0 0.0 318.2 0.58 0.66
190 407.0 1.05 47.3 0.34 455.2 0.97 0.0 0.0 243.4 0.53 0.60
180 367.6 1.10 46.5 0.34 414.1 1.01 0.0 0.0 148.8 0.36 0.40
170 281.7 0.91 28.5 0.34 310.2 0.85 0.0 0.0 114.0 0.37 0.40
160 198.3 1.02 31.4 0.34 229.7 0.93 0.0 0.0 72.8 0.32 0.37
150 109.1 0.89 6.7 0.35 115.8 0.86 0.0 0.0 18.4 0.16 0.17
140 22.7 0.98 1.5 0.34 24.2 0.94 0.0 0.0 0.4 0.02 0.02
TOTAL 17457.7 1.02 2018.9 0.34 19,503.1 0.95 19,591.2 8,909.3 9,167.4 1.93 2.16
September 7, 2017
Designed Final Pit - Boa Esperança Project -

Mineração Caraíba
Level
267
Level
295
15 m-wide safety
and drainage berm
Level
at level 370 (contact
140
between saprolite Level
and rock) 220
10 m-wide safety
and drainage berm
at level 290 (fresh
Level rock)
430
A
Designed Final Pit B’
- Vertical Sections
A’
B
A
A’ B B’
Figure 16-22: Designed final pit in plane and vertical sections.
September 7, 2017
Safety berms were designed to surround the final pit for safety reasons.
For reasons of safety and flexibility and to reduce haulage distances, SRK has decided to consider
not one, but two output routes for the pit after it reaches a closed configuration. Furthermore, the
second road also plays the role of a safety berm at the east and southeast portions of the pit, thus
minimizing the impact on the stripping ratio.
The final pit design in this feasibility phase of the Boa Esperança project totals 19.5 Mt of ore materials
(classified as Measured or Indicated Mineral Resources), with an average diluted grade of 0.95% Cu.
From this total, 17.5 Mt is classified as high-grade with an average Cu content of 1.02% and the
remaining 2.0 Mt as low-grade, with a 0.34% Cu content.
Waste materials amount to 37.7 Mt, which is comprised of 19.6 Mt of saprolite, 8.9 Mt of weathered
rock and 9.2 Mt of fresh rocks. The LOM stripping ratio is 1.93.
Marginal grade material
The final pit design includes 803,016 tonnes of marginal grade material (0.236 > Cu% < 0.28), with an
average grade of 0.26% Cu. This material will be stockpiled close to the primary crusher, but its
processing is not envisaged in this study.
16.4 Mine Scheduling

This section describes the procedures and results of the mine scheduling activities. Deswik software
was used to optimize the mining sequence, which enables automated scheduling while satisfying user
defined constraints and operative scenarios.
16.4.1 Project Data, Parameters, Criteria and Assumptions

Mine Scheduling Strategy
Optimize the project NPV by using the decreasing cut-off grade strategy and low grade material (0.28
< Cu% < 0.40), stockpiling it to feed the plant after the end of mine operation. The marginal grade
material (0.24 < Cu% < 0.28) will be stockpiled for potential future processing, dependent on the price
of copper. A pre-production period of two years will mine the saprolite in order to expose the ore.
Mining and Processing Requirements and Constraints
The diagram in Figure 16-23 summarizes the material flows in the mine and process plant.
September 7, 2017
14.39 Direct to Plant
2.00 Stockpile 1 (Low Grade)

19.50
(Ore) 5.11 3.03 Stockpile 2 (Medium Grade)
(To
Stockpiles) 0.08 Stockpile 3 (High Grade)
0.80 Marginal Ore
MINE 0.10 Soil
0.50 Ground Base for Stockpiles
0.39 Ground Base for Primary Crusher

19.63
37.69 (Saprolite) 0.12 Water Dam
(Waste)
3.04 High Sulphur Tailing Dam
2.54 Lining for Rock Dump
12.94 Saprolite + Tailings Dump
1.96 Secondary Sulfide Dump
15.30 Fresh + Weathered Rock Dump
Figure 16-23: Material flow.
Designed Final Pit
Table 16.10 and Figure 16-22 show the Boa Esperança final pit design used for the pushback design
and mine scheduling.
September 7, 2017
16.4.2 Pushback Design

Five pushbacks were designed to guide the mine scheduling process, including the two pushbacks
corresponding to the pre-production period. Due to the physical characteristics of the Boa Esperança
deposit, as well as the absence of any geometrical or operational constraints, the pushbacks were
basically designed from top to bottom.
Table 16.11 summarizes the results of the pushback design and Figure 16-24 illustrates their
configuration in plane view.
Table 16.11: Summary of pushback’s tonnages and grades.
PP 1 PP 2 PB 1 PB 2 PB 3 Total
High Grade Material
Tonnes (Mt) 0.00 0.00 5.53 4.78 7.15 17.46
Cu (%) - - 1.25 0.99 0.87 1.02
Low Grade Material
Tonnes (Mt) 0.00 0.00 0.23 0.41 1.38 2.02
Cu (%) - - 0.34 0.34 0.34 0.34
Waste Tonnes * (Mt)
Saprolite 7.22 7.08 1.13 2.08 2.08 19.59
Weathered 0.00 3.82 2.21 1.19 1.69 8.91
Fresh 0.00 0.00 0.85 1.79 6.53 9.17
Total 7.22 10.90 4.19 5.06 10.3 37.67
Stripping Ratio (t/t)
Incl. Low Grade
Material - - 0.73 0.97 1.21 1.93
Excl. Low Grade
Material - - 0.76 1.06 1.44 2.16
Total Material (Mt) 7.22 10.9 9.95 10.25 18.83 57.15
* Marginal grade material included in the waste
material
September 7, 2017
B A`
B`
PP01
PP02
A PB01
PB02
PB03
Figure 16-24: Pushback planview.
16.4.3 Mine Scheduling Results

SRK has run several scenarios related to the mine scheduling for the Boa Esperança Project, using
the Deswik programming tools “Sched” and “Blend”. The results of the mine scheduling are
summarized in Table 16.12.
September 7, 2017
Table 16.12: Mine Scheduling Summary.
September 7, 2017
The mine scheduling results are also displayed in graph form in Figure 16-25 to Figure 16-28.
Mine Output
10,000
9,000 1.17
1.16
8,000
0.99
7,000 0.90
0.84 0.86
6,000
Mine Output (kt)
0.74
5,000
4,000
3,000
0.25 0.26 0.25 0.26 0.25 0.26 0.25

2,000
1,000
-
PP - Year 1 PP - Year 2 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9
Ore Mined Tonnage Marginal Ore Tonnage Waste Tonnage Cu Grade - Ore Mined Cu Grade - Marginal Ore
Figure 16-25: Mine output.
Stockpile Inventory (EOP)

5,000 0.9
0.83
4,500 0.8
0.74
4,000
0.7
3,500
0.56 0.56 0.55 0.55 0.6
Stockpile Inventory (kt)
0.54 0.53 0.53

3,000
Cu Grade (%)
0.5
2,500
0.34 0.34 0.34 0.34 0.34 0.34 0.34 0.34 0.4
2,000
0.25 0.25 0.25 0.25 0.25 0.25 0.25 0.25 0.25 0.3
1,500
0.2
1,000
500 0.1
- 0
Marginal SP Inventory Tonnage LG SP Inventory Tonnage MG SP Inventory Tonnage HG SP Inventory Tonnage

Cu Grade - Marginal SP Cu Grade - LG SP Cu Grade - MG SP Cu Grade - HG SP
Figure 16-26: Stockpile inventories.
September 7, 2017
Plant Feed
2,500
1.38
1.29
2,000 1.20
0.95 0.93
1,500 0.88 0.89
Plant Feed (kt)
1,000
0.48
0.34
500
-
Direct Feed Tonnage HG Stockpile Tonnage MG Stockpile Tonnage

LG Stockpile Tonnage Marginal Ore Tonnage Cu Grade - Plant Feed
Figure 16-27: Plant feed details.
Ore Mined vs. Plant Feed

3,500
1.38
3,000 1.29
1.20
2,500
1.16 1.17
0.95 0.93
0.88 0.89
Ore Tonnage (kt)
2,000 0.99
0.90
0.84 0.86
1,500 0.74
0.48
1,000
0.34
500
-
Ore Mined (Above COG: 0.28% Cu) Plant Feed Tonnage Cu Grade - Ore Mined Cu Grade - Plant Feed
Figure 16-28: Ore mined vs. plant feed.
The flow of materials from the mine to their various destinations is summarized in Table 16.13.
September 7, 2017
Table 16.13: Annual flow of materials.

Material Movement (Mt)
Total PP1 PP2 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9
14.39 Direct to Plant 14.39 0.00 0.00 1.89 2.26 2.29 1.92 2.24 2.30 1.49 0.00 0.00
2.00 Stockpile 1 (Low Grade) 2.00 0.00 0.00 0.11 0.16 0.25 0.24 0.32 0.63 0.29 0.00 0.00
19.50
(Ore) 5.11 3.03 Stockpile 2 (Medium Grade) 3.03 0.00 0.00 0.36 0.57 0.75 0.26 0.13 0.40 0.56 0.00 0.00
(To
Stockpiles) 0.08 Stockpile 3 (High Grade) 0.08 0.00 0.00 0.01 0.06 0.01 0.00 0.00 0.00 0.00 0.00 0.00
0.80 Marginal Ore 0.80 0.00 0.00 0.08 0.08 0.09 0.00 0.19 0.31 0.05 0.00 0.00
MINE 0.10 Soil 0.10 0.07 0.03 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.50 Ground Base for Stockpiles 0.50 0.20 0.30 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.39 Ground Base for Primary Crusher 0.39 0.00 0.39 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
19.63
37.69 (Saprolite) 0.12 Water Dam 0.12 0.05 0.07 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
(Waste)
3.04 High Sulphur Tailing Dam 3.04 1.40 1.64 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
2.54 Lining for Rock Dump 2.54 1.32 1.22 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
12.94 Saprolite + Tailings Dump 12.94 4.13 3.43 1.10 1.47 0.87 1.23 0.70 0.01 0.00 0.00 0.00
1.96 Secondary Sulfide Dump 1.96 0.05 0.41 0.66 0.21 0.27 0.13 0.22 0.01 0.00 0.00 0.00
15.30 Fresh + Weathered Rock Dump 15.30 0.00 3.41 1.84 1.11 1.47 1.82 2.12 2.33 1.20 0.00 0.00
TOTAL 57.19 7.22 10.90 6.05 5.92 6.00 5.60 5.92 5.99 3.59 0.00 0.00
16.4.4 Comparison to Solutions Without Stockpiles

SRK has run two additional mine scheduling scenarios (one with no stockpiles and the other using
only the low grade stockpile), in an attempt to assess the benefits that the dynamic multi-stockpiles
would add to the Boa Esperança project. SRK made an effort to optimize both mine scheduling
scenarios. The graph in Figure 16-29 illustrate the comparison.
Details of these two mine scheduling scenarios are shown in Table 16.14 and Table 16.15.
September 7, 2017
Figure 16-29: Comparison between different ore stockpiling scenarios.
September 7, 2017
Table 16.14: Mine scheduling without stockpiles.

TOTAL MOVEMENT 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Tonnes Tonnes 5,953,688 4,952,758 4,743,259 4,743,902 4,798,295 4,521,256 3,637,805 3,847,030 1,875,082 0
0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
ORE 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Tonnes ORE Tonnes ORE 1,971,363 2,308,130 2,307,985 2,308,001 2,307,967 2,308,010 2,308,002 2,308,017 1,372,835 0
CU_DIL ORE CU_DIL ORE 1.15 1.20 1.11 0.91 0.88 0.81 0.75 0.84 0.89 0.00
FE_DIL ORE FE_DIL ORE 12.40 14.31 13.00 11.83 11.63 10.69 10.63 11.34 11.57 0.00
S_DIL ORE S_DIL ORE 5.21 6.61 5.54 4.83 4.69 4.06 4.24 4.60 4.72 0.00
CO_DIL ORE CO_DIL ORE 291.84 420.83 371.42 314.85 307.29 274.41 263.45 319.22 347.20 0.00
MO_DIL ORE MO_DIL ORE 118.54 110.64 74.91 95.52 78.14 61.38 76.71 91.97 85.78 0.00
0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
MARGINAL 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Tonnes MARGINAL Tonnes MARGINAL 62,767 28,986 54,752 58,629 91,148 157,151 141,811 143,083 64,688 0
CU_DIL MARGINAL CU_DIL MARGINAL 0.3 0.3 0.3 0.3 0.3 0.3 0.3 0.3 0.3 0.0
FE_DIL MARGINAL FE_DIL MARGINAL 8.9 9.4 8.8 7.8 8.1 5.7 7.5 8.7 7.6 0.0
S_DIL MARGINAL S_DIL MARGINAL 4.0 2.6 2.8 2.7 2.9 2.3 2.7 3.0 2.2 0.0
CO_DIL MARGINAL CO_DIL MARGINAL 288.4 198.7 247.5 188.8 232.6 117.4 171.5 205.9 160.4 0.0
MO_DIL MARGINAL MO_DIL MARGINAL 134.9 51.5 60.0 58.0 48.3 30.7 88.6 83.2 85.3 0.0
0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
WASTE 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Tonnes WASTE TOTAL Tonnes WASTE TOTAL 3,919,561 2,615,646 2,380,528 2,377,277 2,399,184 2,056,099 1,187,994 1,395,931 437,561 0
0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
BLEND 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
0 0 0 0 0 0 0 0 0 0
TOTAL MINED 0 0 0 0 0 0 0 0 0 0
Source 1 Mined Total.Quantity Source 1 Mined Total.Quantity 5,953,642.4 4,952,726.5 4,743,223.9 4,743,855.9 4,798,260.7 4,521,220.4 3,637,778.2 3,846,999.2 1,875,071.9 0.0
0 0 0 0 0 0 0 0 0 0
PLANT 0 0 0 0 0 0 0 0 0 0
Plant Incoming Total.Quantity Plant Incoming Total.Quantity 1,971,363 2,308,130 2,307,985 2,308,001 2,307,967 2,308,010 2,308,002 2,308,017 1,372,835 0
Plant Incoming Average Total.CU Plant Incoming Average Total.CU 1.15 1.20 1.11 0.91 0.88 0.81 0.75 0.84 0.89 0.00
Plant Incoming Average Total.FE Plant Incoming Average Total.FE 12.40 14.31 13.00 11.83 11.63 10.69 10.63 11.34 11.57 0.00
Plant Incoming Average Total.S Plant Incoming Average Total.S 5.21 6.61 5.54 4.83 4.69 4.06 4.24 4.60 4.72 0.00
Plant Incoming Average Total.CO Plant Incoming Average Total.CO 291.84 420.83 371.42 314.85 307.29 274.41 263.45 319.22 347.20 0.00
Plant Incoming Average Total.MO Plant Incoming Average Total.MO 118.54 110.64 74.91 95.52 78.14 61.38 76.71 91.97 85.78 0.00
0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
STOCKPILE MARGINAL 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
INCOMING MATERIAL 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Stockpile MARGINAL Incoming Total.Quantity Stockpile MARGINAL Incoming Total.Quantity 62,767 28,986 54,752 58,629 91,148 157,151 141,811 143,083 64,688 0
Stockpile MARGINAL Incoming Average Total.CU Stockpile MARGINAL Incoming Average Total.CU 0.25 0.26 0.26 0.25 0.26 0.25 0.26 0.25 0.26 0.00
Stockpile MARGINAL Incoming Average Total.FE Stockpile MARGINAL Incoming Average Total.FE 8.93 9.42 8.76 7.79 8.13 5.75 7.49 8.70 7.60 0.00
Stockpile MARGINAL Incoming Average Total.S Stockpile MARGINAL Incoming Average Total.S 3.97 2.65 2.82 2.71 2.94 2.33 2.65 3.05 2.21 0.00
Stockpile MARGINAL Incoming Average Total.CO Stockpile MARGINAL Incoming Average Total.CO 288.44 198.74 247.52 188.81 232.60 117.42 171.54 205.88 160.38 0.00
Stockpile MARGINAL Incoming Average Total.MO Stockpile MARGINAL Incoming Average Total.MO 134.93 51.45 60.01 57.98 48.32 30.66 88.59 83.18 85.30 0.00
AVAILABLE MATERIAL 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Stockpile MARGINAL Available End Total.Quantity Stockpile MARGINAL Available End Total.Quantity 62,767 91,753 146,505 205,134 296,283 453,433 595,244 738,328 803,016 803,016
Stockpile MARGINAL Available End Total.CU Stockpile MARGINAL Available End Total.CU 0.25 0.25 0.26 0.25 0.25 0.25 0.26 0.25 0.25 0.25
Stockpile MARGINAL Available End Total.FE Stockpile MARGINAL Available End Total.FE 8.93 9.08 8.96 8.63 8.48 7.53 7.52 7.75 7.74 7.74
Stockpile MARGINAL Available End Total.S Stockpile MARGINAL Available End Total.S 3.97 3.55 3.28 3.11 3.06 2.81 2.77 2.82 2.77 2.77
Stockpile MARGINAL Available End Total.CO Stockpile MARGINAL Available End Total.CO 288.44 260.10 255.40 236.37 235.21 194.39 188.94 192.23 189.66 189.66
Stockpile MARGINAL Available End Total.MO Stockpile MARGINAL Available End Total.MO 134.93 108.56 90.41 81.15 71.05 57.05 64.56 68.17 69.55 69.55
0 0 0 0 0 0 0 0 0 0
WASTE DUMP 0 0 0 0 0 0 0 0 0 0
Stockpile WASTE Incoming Total.Quantity Stockpile WASTE Incoming Total.Quantity 3,919,513 2,615,610 2,380,487 2,377,226 2,399,145 2,056,060 1,187,965 1,395,899 437,548 0
Stockpile WASTE Available End Total.Quantity Stockpile WASTE Available End Total.Quantity 3,919,513 6,535,123 8,915,610 11,292,836 13,691,981 15,748,041 16,936,006 18,331,905 18,769,453 18,769,453
September 7, 2017
Table 16.15: Mine scheduling with only a low grade stockpile.

TOTAL MOVEMENT 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Tonnes Tonnes 5,924,395 4,970,185 4,986,325 4,743,099 4,990,550 4,996,362 4,999,519 3,462,641 0 0
0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
ORE 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Tonnes ORE Tonnes ORE 2,037,885 2,403,132 2,455,761 2,513,878 2,530,657 2,494,917 2,750,842 2,313,238 0 0
CU_DIL ORE CU_DIL ORE 1.11 1.23 1.12 0.90 0.84 0.80 0.76 0.90 0.00 0.00
FE_DIL ORE FE_DIL ORE 12.43 14.15 13.08 11.74 11.41 10.87 10.53 11.66 0.00 0.00
S_DIL ORE S_DIL ORE 5.22 6.39 5.68 4.86 4.37 4.17 4.41 4.66 0.00 0.00
CO_DIL ORE CO_DIL ORE 300.66 395.78 401.64 297.19 288.47 270.62 297.47 334.51 0.00 0.00
MO_DIL ORE MO_DIL ORE 126.32 98.20 82.53 94.69 66.54 70.01 78.71 94.14 0.00 0.00
0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
MARGINAL 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Tonnes MARGINAL Tonnes MARGINAL 61,203 39,131 58,346 57,235 101,351 162,019 217,285 106,447 0 0
CU_DIL MARGINAL CU_DIL MARGINAL 0.3 0.3 0.3 0.3 0.3 0.3 0.3 0.3 0.0 0.0
FE_DIL MARGINAL FE_DIL MARGINAL 8.9 8.8 8.9 7.8 7.6 6.3 7.9 8.0 0.0 0.0
S_DIL MARGINAL S_DIL MARGINAL 4.0 2.4 2.7 3.0 3.0 2.5 2.7 2.6 0.0 0.0
CO_DIL MARGINAL CO_DIL MARGINAL 289.3 186.7 238.2 208.5 210.6 136.7 181.6 174.1 0.0 0.0
MO_DIL MARGINAL MO_DIL MARGINAL 137.3 46.3 61.1 56.3 41.9 50.8 81.9 80.5 0.0 0.0
0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
WASTE 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Tonnes WASTE TOTAL Tonnes WASTE TOTAL 3,825,310 2,527,928 2,472,225 2,171,992 2,358,546 2,339,429 2,031,394 1,042,959 0 0
0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
BLEND 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
0 0 0 0 0 0 0 0 0 0
TOTAL MINED 0 0 0 0 0 0 0 0 0 0
Source 1 Mined Total.Quantity Source 1 Mined Total.Quantity 5,924,348.0 4,970,150.5 4,986,291.1 4,743,058.4 4,990,509.2 4,996,320.5 4,999,480.3 3,462,620.7 0.0 0.0
0 0 0 0 0 0 0 0 0 0
PLANT 0 0 0 0 0 0 0 0 0 0
Plant Incoming Total.Quantity Plant Incoming Total.Quantity 1,971,417 2,308,000 2,308,000 2,308,000 2,308,000 2,308,000 2,308,000 2,308,000 1,372,893 0
Plant Incoming Average Total.CU Plant Incoming Average Total.CU 1.14 1.26 1.17 0.95 0.88 0.84 0.84 0.90 0.34 0.00
Plant Incoming Average Total.FE Plant Incoming Average Total.FE 12.53 14.31 13.29 11.97 11.67 11.10 10.86 11.65 9.01 0.00
Plant Incoming Average Total.S Plant Incoming Average Total.S 5.27 6.52 5.78 5.02 4.51 4.27 4.61 4.69 3.25 0.00
Plant Incoming Average Total.CO Plant Incoming Average Total.CO 303.04 402.87 399.79 303.39 296.40 280.25 312.65 336.25 230.02 0.00
Plant Incoming Average Total.MO Plant Incoming Average Total.MO 126.67 98.57 82.36 98.15 66.68 71.77 77.26 91.24 79.54 0.00
0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
STOCKPILE MARGINAL 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Stockpile MARGINAL Incoming Total.Quantity Stockpile MARGINAL Incoming Total.Quantity 61,203 39,131 58,346 57,235 101,351 162,019 217,285 106,447 0 0
Stockpile MARGINAL Incoming Average Total.CU Stockpile MARGINAL Incoming Average Total.CU 0.25 0.26 0.26 0.25 0.26 0.25 0.25 0.25 0.00 0.00
Stockpile MARGINAL Incoming Average Total.FE Stockpile MARGINAL Incoming Average Total.FE 8.88 8.84 8.91 7.80 7.62 6.30 7.90 7.97 0.00 0.00
Stockpile MARGINAL Incoming Average Total.S Stockpile MARGINAL Incoming Average Total.S 4.03 2.37 2.71 3.03 2.99 2.48 2.66 2.58 0.00 0.00
Stockpile MARGINAL Incoming Average Total.CO Stockpile MARGINAL Incoming Average Total.CO 289.27 186.67 238.19 208.48 210.58 136.66 181.56 174.05 0.00 0.00
Stockpile MARGINAL Incoming Average Total.MO Stockpile MARGINAL Incoming Average Total.MO 137.31 46.35 61.14 56.33 41.93 50.79 81.89 80.50 0.00 0.00
Stockpile MARGINAL Available End Total.Quantity Stockpile MARGINAL Available End Total.Quantity 61,203 100,333 158,679 215,914 317,265 479,284 696,569 803,016 803,016 803,016
Stockpile MARGINAL Available End Total.CU Stockpile MARGINAL Available End Total.CU 0.25 0.25 0.25 0.25 0.25 0.25 0.25 0.25 0.25 0.25
Stockpile MARGINAL Available End Total.FE Stockpile MARGINAL Available End Total.FE 8.88 8.87 8.88 8.59 8.28 7.61 7.70 7.74 7.74 7.74
Stockpile MARGINAL Available End Total.S Stockpile MARGINAL Available End Total.S 4.03 3.38 3.14 3.11 3.07 2.87 2.80 2.77 2.77 2.77
Stockpile MARGINAL Available End Total.CO Stockpile MARGINAL Available End Total.CO 289.27 249.25 245.18 235.46 227.51 196.80 192.05 189.66 189.66 189.66
Stockpile MARGINAL Available End Total.MO Stockpile MARGINAL Available End Total.MO 137.31 101.83 86.87 78.77 67.01 61.52 67.88 69.55 69.55 69.55
0 0 0 0 0 0 0 0 0 0
WASTE DUMP 0 0 0 0 0 0 0 0 0 0
Stockpile WASTE Incoming Total.Quantity Stockpile WASTE Incoming Total.Quantity 3,825,260 2,527,888 2,472,185 2,171,945 2,358,502 2,339,384 2,031,353 1,042,936 0 0
Stockpile WASTE Available End Total.Quantity Stockpile WASTE Available End Total.Quantity 3,825,260 6,353,148 8,825,332 10,997,278 13,355,779 15,695,164 17,726,517 18,769,453 18,769,453 18,769,453
16.5 Mine Operation and Equipment Requirements

16.5.1 Mine Operation
The operation of the Boa Esperança mine will utilize conventional open pit mining techniques and
small size mining equipment to mine a total of 57.2 Mt of material over the life of the mine. This
comprises 19.5 Mt of ore and 37.7 Mt of waste material. A total of 5.1 Mt of ore will be moved from the
September 7, 2017
stockpiles to the plant. Table 16.16 summarizes the mined and moved materials over the life of the
project.
September 7, 2017
Table 16.16: Material movement.
Ore Reclaiming Waste

Waste Total Total
Low Total Stockpile Saprolite Total / Ore Mined Movement
High Grade Marginal Weathered Fresh
Year Grade Mined to Crusher Friable Mined
Pit to Pit to Pit to

Crusher Stockpile Stockpile
t x 10³ t x 10³ t x 10³ t x 10³ t x 10³ t x 10³ t x 10³ t x 10³ t x 10³ t x 10³ t/t t x 10³ t x 10³
PP1 - - - - - - 7,228 50 - 7,278 - 7,278 7,278
PP2 - - - - - - 7,174 3,670 0.67 10,844 - 10,844 10,844
01 1,885.59 14.50 469.94 2,370.03 85.83 59.14 1,095 1,514 1,008 3,676 1.55 6,046 6,132
02 2,258.56 56.75 727.90 3,043.21 49.44 55.48 1,457 714 650 2,877 0.95 5,920 5,969
03 2,288.23 8.40 993.36 3,289.99 19.77 77.75 868 671 1,072 2,689 0.82 5,979 5,998
04 1,918.33 - 496.03 2,414.36 389.67 92.65 1,247 640 1,216 3,196 1.32 5,610 6,000
05 2,240.86 - 457.39 2,698.25 67.14 152.15 751 1,082 1,252 3,238 1.20 5,936 6,003
06 2,304.42 - 1,028.65 3,333.07 3.58 254.79 8 995 1,405 2,661 0.80 5,994 5,998
07 1,493.70 - 860.71 2,354.41 814.29 111.07 - 452 671 1,234 0.52 3,588 4,403
08 - - - - 2,307.98 - - - - - - - 2,308
09 - - - - 1,372.88 - - - - - - - 1,373
Total 14,390 80 5,034 19,503 5,111 803.02 19,826 9,788 7,275 37,692 1.93 57,195 62,306
September 7, 2017
The Boa Esperança Project will be developed in three different phases, as follows:
• Phase 1: two years of pre-production conducted by a contracted mine operation firm;

• Phase 2: seven years of mine operation with own equipment;
• Phase 3: two years of plant operation fed with previously stockpiled low grade material.
It has been assumed that 100% of weathered and fresh rocks and 10% of saprolites will be drilled and
blasted in 10-m-high benches. Ore will be hauled to the primary crusher or to the ROM stockpiles close
to the primary crusher. Waste materials will be hauled to different dumps and destinations. Grade
control will be performed through drilling, sampling and assaying materials within the pit limits using
the production drills.
The mine is scheduled to operate in three 8 hour shifts, 7 days per week, 365 days per year. Whenever
mine production needs to be reduced or interrupted, the primary crusher will be fed from the
regularization pile using a front-end loader.
The Boa Esperança deposit is located at the top of a hill that rises to around 200 m above the
surrounding plains and has a maximum elevation of approximately 470 m above sea level.
Although there are no potential flood risks, it would be prudent to design a basic water management
system to improve mine operations and avoid undesirable events. The drainage system should include
ditches, diversions, sediment sumps and sediment ponds.
Interceptor ditches will be excavated around the active mining areas to divert precipitation flows, and
to minimize erosion and the potential for fines to be carried over into the local environment. Local
sumps will be excavated around the perimeter of the disturbed areas to settle coarse sediments (sands
and gravels). Typically, sumps will be 2 m deep and have a 10 m x 10 m plane projection. Figure 16-30
illustrates a typical section of the bench drainage system.
Figure 16-30: Bench drainage system.
September 7, 2017
16.5.2 Mine Equipment Selection

The main mine equipment selected for the Boa Esperança project consists of hydraulic excavators,
on-highway trucks and drills.
The truck selected to haul ore from the pit and the stockpiles to the crusher and waste from the pit to
its various destinations is an on-highway truck in the 35 t payload class, which provides an adequate
number of units throughout the mine life.
A hydraulic excavator with a backhoe configuration, equipped with a 4.0 m3 bucket, has been selected
based on the required production rates and truck matching. This machine is capable of loading the
trucks in 4 or 5 passes.
A front-end loader with a 3.6 m3 bucket has been selected for feeding the primary crusher whenever
the flow from the mine is reduced or interrupted. This equipment can also be used for other auxiliary
services, such as the construction of safety berms. When necessary, the front-end loader can
complement or replace excavators used for in-pit loading.
Due to the hardness of the material, a 5” drill will be used for drilling both ore and waste. This drill will
also be used for the preparation of access roads and mining faces. A hydraulic hammer will be used
for the secondary breakage of boulders.
The track dozer selected for several tasks in the mine is in the 150 hp / 3.9m blade width class. A 120
hp / 3.7 m-blade width grader was chosen for haul roads and access building and maintenance within
the project area.
Water trucks will be required to wet temporary access roads and mining faces, in order to keep the
amount of dust down to acceptable level. On-highway trucks equipped with 18,000 L tank were
selected for this purpose.
Other auxiliary equipment includes:
• Fuel and Lube Truck: 5,000 L diesel tank and 1,000 L lube oil tank, for field fueling and
lubricating;
• Portable Lightning Tower: 2-kW lighting capacity, diesel-powered;
Light Vehicle: 4x4 double cabin pickup truck, for services and personnel transportation within the mine
area.
Table 16.17 summarizes the selected mine equipment.
September 7, 2017
Table 16.17: Mine equipment list and specifications.

Mine Equipment
Reference
Main Equipment Manufacturer Model Specification
Top Hammer Drill Sandvik DP 1100i 5" Blast Hole Diameter
Backhoe Hydraulic Excavator Liebherr R964 4 m3 bucket
On Highway Truck Scania G440 CB 8X4 35 t
Bulldozer Caterpillar D8T 9 m blade width
Motor grader Caterpillar 140K 3.7 m blade width
Reference
Ancillary Equipment Manufacturer Model Specification
Water Truck Scania 440G CB6x4 18000 l tank
Front end Loader Liebherr L580 3.6 m3 bucket
Backhoe Loader Caterpillar 416E 1 m3 bucket / hydraulic hammer
Field Service Truck Scania P250 DB4x2 -
Fuel/Lube Truck Scania 440G CB6x4 -
Flatbed Truck Scania 440G CB6x4 -
Munk Truck Scania 440G CB6x4 -
Portable Lightning Tower AtlasCopco QLT M 20 220V - 2KW lightning capacity
Service Vehicle Toyota Hilux 4 x 4 double cabin
Forklift Heli CP CD25 2.5 t
16.5.3 Mine Equipment Requirements

An overall availability of 80% has been assumed for main production equipment and 75% for all other
types. A maximum utilization of 90% has been applied for haulage trucks and 85% for loading and
drilling equipment. An efficiency factor of 0.83 (50 min/60 min) has been used for the calculation of
productive hours for the main mine equipment.
Three excavator units will be required throughout the life of the project. One front-end-loader will be
required to feed the crusher when the mine is not in operation.
Haulage cycle time calculations were based on the average distance of ore and waste haulage per
year and on average speeds. In addition to travel time, an average fixed cycle time of 5.4 minutes was
used to represent time spending loading and unloading, maneuvering and waiting.
The truck fleet requirement varies between 11 and 12 units throughout the life of the project.
Drilling is to be done in 10 m benches. Unit drill productivity has been estimated at 3.5 Mtpy, based on
an assumed drilling rate of 24 m per hour. Two drills will be required over the life of the project.
A summary of fleet requirements for the main mine equipment for the Boa Esperança project is shown
in Table 16.18. The corresponding fleet working hours are shown in Table 16.19.
September 7, 2017
Table 16.18: Mine fleet requirements.

Mine Equipment
On Highway
Drill Excavator Bulldozer Motor grader
Truck
Add/Replacement
Add/Replacement
Add/Replacement
Add/Replacement
Add/Replacement
Year
End-of-Life
End-of-Life
End-of-Life
End-of-Life
End-of-Life
Operating
Operating
Operating
Operating
Operating
Required
Required
Required
Required
Required
1 - - 2 2 - - 3 3 - - 11 11 - - 3 3 - - 2 2
2 - 2 - 2 - 3 - 3 - 11 1 12 - 3 - 3 - 2 - 2
3 - 2 - 2 - 3 - 3 - 12 - 12 - 3 - 3 - 2 - 2
4 - 2 - 2 - 3 - 3 11 1 11 12 - 3 - 3 - 2 - 2
5 - 2 - 2 - 3 - 3 - 12 - 12 - 3 - 3 - 2 - 2
6 - 2 - 2 - 3 - 3 - 12 - 12 - 3 - 3 - 2 - 2
7 - 2 - 2 1 2 - 2 12 - 8 8 - 3 - 3 - 2 - 2
8 2 - - - 2 - - - - 8 - 8 1 2 - 2 1 1 - 1
9 - - - - - - - - - 8 - 8 - 2 - 2 - 1 - 1
September 7, 2017
Table 16.19: Fleet working hours.
Fleet Hours
Year Drilling Excavation/Loading Haulage

Saprolite Weathered Fresh Total Saprolite Weathered Fresh Total
Ore Waste Ore Ore
Friable Waste Waste Waste Friable Waste Waste Waste
1 4,481 3,460 4,920 2,660 3,193 2,306 8,159 22,547 13,589 15,826 11,129 40,544
2 5,681 2,058 6,237 3,540 1,507 1,534 6,581 29,247 17,866 8,265 9,556 35,687
3 6,242 2,727 6,854 2,109 1,416 2,457 5,982 30,304 12,110 8,477 14,879 35,466
4 4,592 3,000 5,043 3,032 1,349 2,800 7,181 24,854 16,799 8,169 17,633 42,601
5 5,132 3,572 5,635 1,825 2,283 3,001 7,108 25,820 9,722 12,395 15,959 38,076
6 6,340 3,857 6,961 18 2,097 3,521 5,637 22,952 101 12,074 19,823 31,999
7 4,478 1,800 4,917 - 954 1,658 2,613 26,966 - 6,482 11,097 17,579
8 - - - - - - - 14,293 - - - -
9 - - - - - - - 8,502 - - - -
September 7, 2017
16.5.4 Blasting
Supplying, storage, handling and loading of explosives into the holes will be the responsibility of a
specialized outsourced company, which will operate through a service provision contract.
The explosives will be transported in Anfo Loader trucks, which will load the holes with blended
explosive (30% ANFO, 70% emulsion).
16.6 Labor Requirements

Managers, administrative workers and some technicians will work for only one shift (day shift).
Equipment operators will work for one or two shifts, depending on the type of equipment. The
workforce required to operate the Boa Esperança mine varies between 209 and 241 workers
throughout the operation of the mine, including an allowance for vacations, sickness leave and training.
Details of the labor requirements and costs are shown in Table 16.20 to Table 16.22.
September 7, 2017
Table 16.20: Labor costs (R$).

Working Arrangement Monthly Salary
Monthly
Total Monthly per
Total Annual
Total Charges and per Function Total Annual (R$)
Adm A B C D (R$)
Benefits (R$)
Function (R$)
(R$)
Mine and geology 5 1 1 1 0 8 30,772 11,078 41,850 557,859 972,509
Mine Manager 1 0 0 0 0 1 19,336 6,961 26,297 350,534 350,534
Coordinator 0 1 1 1 0 3 11,436 4,117 15,553 207,325 621,974
Geologist 1 0 0 0 0 1 8,154 2,935 11,089 147,815 147,815
Surveyor 1 0 0 0 0 1 7,574 2,727 10,300 137,305 137,305
Draftsman 1 0 0 0 0 1 2,416 870 3,286 43,802 43,802
Admin Assistant 1 0 0 0 0 1 2,197 791 2,988 39,832 39,832
Mine Operation 6 43 43 43 43 178 45,829 16,498 62,328 830,827 8,286,756
Mining Technician 1 1 1 1 1 5 3,003 1,081 4,084 54,437 272,187
Blaster 1 0 0 0 0 1 2,591 933 3,523 46,968 46,968
Helper 2 3 3 3 3 14 1,048 377 1,425 18,997 265,956
Job Safety Technician 2 0 0 0 0 2 4,182 1,506 5,688 75,820 151,640
Shift Supervisor 0 1 1 1 1 4 5,639 2,030 7,669 102,233 408,933
Drill Operator 0 2 2 2 2 8 2,776 999 3,775 50,320 402,561
Excavator Operator 0 3 3 3 3 12 2,776 999 3,775 50,320 603,842
Truck Operator 0 12 12 12 12 48 2,776 999 3,775 50,320 2,415,366
FEL Operator 0 2 2 2 2 8 2,776 999 3,775 50,320 402,561
Bulldozer Operator 0 3 3 3 3 12 2,776 999 3,775 50,320 603,842
Motograder Operator 0 2 2 2 2 8 2,776 999 3,775 50,320 402,561
Water Truck Operator 0 2 2 2 2 8 2,776 999 3,775 50,320 402,561
Fuel Truck Operator 0 1 1 1 1 4 2,776 999 3,775 50,320 201,281
Multi-function Operator 0 2 2 2 2 8 2,776 999 3,775 50,320 402,561
Assistant 0 6 6 6 6 24 1,609 579 2,188 29,171 700,097
Replacement Operator 0 3 3 3 3 12 2,776 999 3,775 50,320 603,842
Mine Equipament Maintenance 19 8 8 8 8 51 35,179 12,664 47,843 637,748 1,882,197
Coordinator 1 0 0 0 0 1 11,436 4,117 15,553 207,325 207,325
Maintenance Technician 2 0 0 0 0 2 3,003 1,081 4,084 54,437 108,875
Admin Assistant 1 0 0 0 0 1 2,197 791 2,988 39,832 39,832
Equipment Washer 3 0 0 0 0 3 1,048 377 1,425 18,997 56,991
Lubeman 0 1 1 1 1 4 1,601 576 2,178 29,030 116,121
Tyre Repairman 0 1 1 1 1 4 1,232 443 1,675 22,331 89,324
Mechanic 5 0 0 0 0 5 1,741 627 2,368 31,560 157,802
Maintenance Helper 0 3 3 3 3 12 1,048 377 1,425 18,997 227,962
Welder 3 0 0 0 0 3 1,741 627 2,368 31,560 94,681
Vehycle Electrician 3 0 0 0 0 3 2,591 933 3,523 46,968 140,903
Equipment Operator 1 0 0 0 0 1 1,808 651 2,458 32,770 32,770
Vehycle Mechanic 0 2 2 2 2 8 2,673 962 3,636 48,463 387,702
Vehycle Electrician 0 1 1 1 1 4 3,060 1,102 4,162 55,478 221,912
September 7, 2017
Table 16.21: Mine workforce.
Mine and Mine Mine Equipment

Year Total
geology Operation Maintenance
1 8 178 51 237
2 8 178 51 237
3 8 178 51 237
4 8 178 51 237
5 8 178 51 237
6 8 178 51 237
7 8 160 51 219
8 7 125 40 172
9 7 125 40 172
Average 8 164 49 221
Table 16.22: Annual Labor costs.

Mine Labor Cost (R$ x 1,000)
Mine Mine Mine
Year Mine
Workforce Planning Equipment Total
Operation
and Geology Maintenance
1 237 1,342 8,288 1,884 11,510
2 237 1,342 8,288 1,884 11,510
3 237 1,342 8,288 1,884 11,510
4 237 1,342 8,288 1,884 11,510
5 237 1,342 8,288 1,884 11,510
6 237 1,342 8,288 1,884 11,510
7 219 1,342 7,380 1,884 10,603
8 172 1,194 5,796 1,512 8,499
9 172 1,194 5,796 1,512 8,499
Total R$11,775 R$68,692 R$16,197 R$96,667
16.7 Mine Infrastructure

The main mine infrastructure and facilities for the Boa Esperança Project are comprised of the
following items:
• Internal roads;
• Mine workshop and warehouse;
• Explosive and accessories magazines;
• Fuel facilities;
• Tire bay;
• Wash bay;
• Technical office;
• Core shed.
The area selected for the mine facilities is located in a flat region to the northeast of the pit.
The explosives and accessories magazines will be sited in the northern section of the hill. This location
is relatively close to a public road, but the magazines will be built in trenches in order to maintain the
required distances from the project facilities and existing public roads, as shown in Figure 16-31.
September 7, 2017
Explosives and
Accessories Magazines LG, MG,
HG Ore
and
Marginal
Stockpiles
Figure 16-31: General layout of the project.
Internal roads
The main road connecting the mine to the plant and project facilities has been designed to be 13 m
wide, with a maximum ramp of 10%.
Workshop and Warehouse
The workshop and warehouse complex will accommodate the required facilities for repair and
maintenance, as well as storage space for spare parts and consumables, for both the plant and mine
equipment.
The workshop building will be comprised of three bays, be sufficiently sized to accommodate the trucks
at full dump height and cover an area of approximately 828 m2. In addition to this, there will be an
annex with two floors and an area of 480 m2.
The warehouse will be a metallic shed-like structure located close to the warehouse and will cover an
area of 1,500 m2.
Explosives and Accessories Magazines
The explosives and accessories magazines will cover an area of 5,400 m2, surrounded by fencing.
The selected magazine location shown in the general layout drawing has been designed to comply
with safety requirements, such as distance to pit and distance to major infrastructure, as well as its
distance from external public roads.
September 7, 2017
Fuel Facilities
It is assumed that trucks and other mobile equipment will refuel at the refueling facility. Excavators,
wheel loaders, dozers, drills and lighting towers will be refueled by the fuel/lubrication truck in the field.
The fuel facilities consist in another metallic shed-like structure located close to the warehouse,
covering an area of 360 m2.
Average daily fuel consumption is estimated at 8,600 L, with maximum consumption reaching 9,000
L. Fuel storage will be provided to a capacity of 72,000 L, sufficient for 8 days’ use at maximum
consumption.
Tire Bay
The tire bay will be constructed close to the workshop and will also be used for storing spare tires,
parts and tools.
Wash Bay
A wash bay suitable for washing mobile equipment and light vehicles will be required. It should be
located adjacent to the main workshop facility. The minimum requirements for the wash bay are an
area of 340 m2 and a 24 m x 14 m concrete platform, with drainage flowing to a separation sump.
Technical Office
The technical office will accommodate workforce of 19 employees, as detailed below:
• Mine management (2): (1) mine manager and (1) administrator;

• Mine operation (9): (1) coordinator, (5) mine technicians, (1) blaster and (2) job safety
technicians;
• Mine planning and geology (4): (1) coordinator, (1) geologist, (1) surveyor and (1) draftsman;
• Mine equipment maintenance (4): (1) coordinator, (2) technicians and (1) assistant.
The mine office building area will cover an area of about 400 m2 and will include space for meeting
rooms and restrooms.
Core Shed
A core storage facility is required to handle and store drill core samples from both geological and grade
control drilling. The building will cover 540 m2 and will be equipped with racks and fork-lift access
routes.
September 7, 2017
17 Recovery Methods
17.1 Operation Results
The project is in the development stage and there are no operating results.
17.2 Processing Methods

The Boa Esperança concentrator has been designed to process 2.308 Mt of copper ore per year at a
nominal processing rate 9,033.6 tonnes per day (t/d) at primary crushing feed and incorporates
equipment and process unit operations considered standard for the industry. The process flowsheet
includes three-stage crushing, jigging, ball mill grinding, copper rougher flotation, two stages of copper
cleaner flotation and pyrite flotation from the copper rougher and scavenger flotation tailing. The final
copper concentrate is thickened prior to pressure filtration and the flotation tailing is thickened and
classified prior to discharge to the tailing storage facility. The pyrite concentrate from the pyrite flotation
is sent to the pond of high sulfur. The flowsheets and material balances have been prepared as part
of the Tecnomin’s process design.
17.2.1 Crushing Plant

Run-of-mine (ROM) ore will be trucked from the mine directly to a 60 t hopper fitted with a grizzly
having 600 mm x 600 mm openings. The ore will go to a feeder and discharged in an inclined grizzly
with bars spaced at 100 mm. The grizzly oversize will feed a Metso C125 jaw crusher (4005-BR-01),
which will crush the ore to minus 185 mm, and discharge onto a sacrifice conveyor and then in a
collection conveyor. The collection conveyor will be fitted with a belt scale to record wet tonnes crushed
and will transport the ore to a 7,260 m³ conical coarse ore stockpile. The ore will be taken out by
vibrating chutes directly to the first screening and secondary crushing circuit.
Primary crushed ore reclaimed by the stockpile will be conveyed with a conveyor that will be fitted with
a metal detector and tramp metal magnet, and which will discharge in the primary double-deck
vibrating screen. The top deck will have 60 mm openings and the bottom deck will have 20 mm
openings. Screen oversize will feed a Metso HP-400 cone crusher (4010-BR-001). The ore minus 55
mm will feed two silos 55 m³ each that will discharge across secondary double-deck vibration screen.
The top deck will have 10 mm openings and the bottom deck will have 3 mm openings. The first deck
oversize, +10 mm, will be conveyed to two silos of 45 m³ each and then will feed the tertiary crusher
HP-400.
The 3 mm screen undersize will be conveyed directly to the 3,200 m³ live capacity pile (13,000 m³ total
capacity) grinding fine ore stockpile, which has been designed as an ore homogenization stockpile fed
by a tripper conveyor system with a belt scale which will serve to blend the ore. It was foreseen a
20,000 m³ emergency stockpile that will be reclaimed, if necessary, by six vibratory feeders (two stand
by).
The intermediate material (-10 mm + 3 mm) from the secondary screens will be transported to the wet
tertiary double-deck screening Metso LH2448. Its undersize will be pumped to the ball mill pulp box.
September 7, 2017
Its oversize will feed the jigging or, in case of jigging stop, will be conveyed direct to the grinding ore
homogenization stockpile.
17.2.2 Jigging Plant

The material retained in the tertiary screening (+3 mm) will be submitted to the jigging process.
The reversible conveyor will discharge into two silos installed in parallel which feed two pneumatic jigs,
Kuttner package, ALL JIG G / F-3000X1860. Each jig is equipped with an air blower.
The jigs waste will be directed to dewatering screens and the material will contain 6% moisture. This
material can be sent to the waste pile or to the emergency tailing stack. In this situation one wheel
loader will feed a recovery hopper installed in the belt conveyor that transports the material to the
waste pile.
Jigs concentrates will be directed to dewatering screens that reduces ore moisture to 6%. After that
the concentrate will be directed to the homogenization stockpile by the tripper conveyor system.
All the water from the screens underflow and the two jigs, and the process fines, will be directed to the
water box where the fines are pumped to the ball mill slurry box. The remaining water is directed to
the jigs recirculation water tank.
17.2.3 Grinding Circuit

Crushed ore (- 3 mm) and the jig concentrate (between 3 mm and 10 mm) will be reclaimed from the
ore homogenization stockpile by eight vibratory feeders (two stand by) that will discharge onto a
collection conveyor located in a tunnel beneath the stockpile, and then conveyed to a 70 m³ fine ore
bin ahead of the grinding circuit. Ore will be withdrawn from the fine ore bin onto the ball mill feed
conveyor, which will be fitted with a belt scale. The grinding circuit will consist of a single Metso 18 ft
diameter x 23 ft long overflow ball mill (3.310 kW) operated in closed circuit with 8 Derrick screens
(stack-size model-five panels) to produce a final grind of 80% passing 110 microns (µm). At the
overflow of the flotation feed pump will be installed a PSI to control the ball mill particle size product.
It is expected that the ball mill will be operated with a maximum 40% ball charge volume at a slurry
density of 75% solids. A Bond ball mill work index (Wi) of 17,6 kWh/t has been used for design and
sizing of the grinding circuit (information from “SGS Geosol – Final Report-Jigging, flotation and
magnetic separation on a composite sample for the Boa Esperança Project – Final Report – SG0014-
1403/rev02 – 10/04/2015”).
17.2.4 Copper and Pyrite Flotation

The screens undersize will be transported to the conditioning tank with stirrer which copper flotation
reagents are added and then pumped to feed the copper rougher flotation. This flotation consists of a
6 tank cells 30 m³ each with an estimated residence time of 16 minutes. The two first cells concentrate
(foam) will be separately collected and will feed a cleaning step to be processed in a contact cell type
Jameson Model Z1200/1. This concentrate is final copper concentrate.
September 7, 2017
The contact cell tailing and the remaining rougher flotation foam feed a 10-hydrocyclone battery 4". Its
underflow will feed the vertical mill, Vertimill type, where the ore will be re-grinded to generate 80% of
the product below 45 microns (0.045 mm). The hydrocyclone overflow will be pumped to cleaning
flotation (3 tank cells, 10m3).
The cleaning’s tailing feeds the scavenger-cleaner stage (5 tank cells, 10m3) and the cleaning and
scavenger-cleaner concentrate feeds the second cell contact tailing type Jameson Model E 1714/2.
These concentrates constituting the final copper concentrate which will be pumped for the concentrate
thickener. The tailing of the second cell contact returns to the cleaning flotation.
The copper flotation steps will be conducted with pulp pH around 10.5.
The rougher and scavenger-cleaner flotation tailings will be joint and the resulting slurry will be pumped
to the pyrite flotation tank conditioner and then will feed 7 cells tank with 30 m³, pH range 6.4 to 6.8,
with a residence time estimated of 18 minutes. The pyrite concentrate (foam) will be pumped to a high
sulfur pond and the waste will be pumped to the tailing thickener.
The flotation reagents are: lime milk solution as pH controller in the copper flotation, DTF (dimethyl
phosphate) as collector and F-810 as sparkling (FLOMIN). For the pyrite flotation will be used sulfuric
acid 10% solution for pulp pH adjustment and PAX collector (amyl xanthate).
17.2.5 Thickening and Filtration

The final flotation tailings will be pumped through a slurry pump for 5 hydrocyclones, four running and
one stand-by, model 20" GMAX. The hydrocyclones undersize will go to four Derrick 4`x10` 2SG48-
120W-4A dewatering screens. The screen‘s retained material will go to the tailings disposal pile. The
hydrocyclone overflow will feed the tailings thickener, 20 m diameter, high-capacity. The thickener
overflow will go, by gravity, to the recovered water tank and the underflow will be pumped to the tank
with stirrer and from this to two press filters, 81 plates – 1,500 x 1,500 mm. The generated cake (with
an expected maximum moisture of 15%) will be collected to the discard stack. The filter washing water
and the filtered water will be pumped back to the thickener.
The final copper concentrate from flotation is pumped into the concentrate thickener, 8 m diameter.
The thickened concentrated with an estimated solids percentage of 60%, is pumped to the press filter
system, 35 plates 1500 x 1500mm. The concentrate thickener overflow will go by gravity to the
recovered water tank.
The cake (with an expected maximum moisture of 10%) falls into a bay and will be stacked, stored
and recovered by wheel loader, and finally dispatched in trucks.
The filter washing water and the filtered water will be pumped back to the thickener.
17.2.6 Water Recirculation

The concentrate pulp of pyrite flotation, which is considered high sulfur, is pumped to a coated pond.
After decantation, part of the contained water is recovered to the plant by a float pumping.
September 7, 2017
The thickener overflow also goes by gravity to the water recovered box. This water is pumped to the
distribution of recovered process water to utility water distribution throughout the plant. The recovered
water tank will have raw water as make-up water.
17.2.7 Intake Raw Water

Raw water will be taken up to a distance of approximately 1km from plant at a rate of 143,0 m³ / h
through two float pumps system and stored in the raw water reservoir 400 m³ capacity.
17.2.8 Drinking Water

The drinking water is generated from the raw water in a water treatment unit, 10 m³ / h capacity, to be
installed next to the raw water tank. Drinking water will be stored in a 100 m³ tank and distributed to
the consumers.
17.2.9 Sealing Water

For sealing water will be used pressurized raw water and distributed to the various consumption points.
17.2.10 Compressed Air

The compressed air system consists of seven operational compressors:
• Four screw compressors dedicated to the press filters (two for tailing filters and two for copper
concentrate filters);
• A screw compressor for general services;
• A screw compressor for instruments;
• A piston compressor for the laboratory.
There are still two compressors for press filters, two for general services and one for instruments, all
of them as stand-by.
The tank cells will have blowers provided together with them by the manufacturer.
17.2.11 Reagent Preparation

i) Hydrated lime (Ca (OH) 2)
Hydrated lime is received by 30 m³ trucks and stored in silos of 45 m³, storage for 15 days’
consumption. The “milk” with 10% of solids will be prepared using a screw dosing feeder which will
add the lime in a 13 m³ tank. Lime milk will be distributed to the copper flotation circuit via distribution
pumps. The estimated consumption for Hydrated lime (pH control – copper flotation) is 700 g/t.
ii) Sulfuric acid (H2SO4)
September 7, 2017
The 98% concentrated sulfuric acid is received by 30 m³ trucks and stored in silos of 60 m³, storage
for 30 days’ consumption and transferred to a 10 m³ tank – 10% solution. This solution will be
distributed to the consumption points through positive displacement pumps. The estimated
consumption for 98% sulfuric acid (pH control – pyrite flotation) is 500 g/t.
iii) Collector PAX
The amil xanthate collector (PAX) will be received in 850 kg bags, which will be stored near the reagent
preparation warehouse (storage of 16 bags, equivalent to 60 days’ consumption).
The bag is discharged in a 2 m³ hopper and transferred to the preparation tank 4.4 m³ - 10% solution.
The solution will be transferred to the distribution tank. This solution will be distributed to the
consumption points through positive displacement pumps. The estimated consumption for Amyl
xanthate (PAX) (collector in the pyrite flotation) is 50 g/t.
iv) Collector DTF
The dimethyl phosphate collector (DTF) will be received in 850 kg bags, which will be stored near the
reagent preparation warehouse (storage 10 bags, equivalent to 60 days consumption).
The bag is discharged in a 2,6 m³ tank, where a DTF 10% solution is prepared. The solution will be
transferred to the distribution tank and will be distributed to the consumption points through positive
displacement pumps. The estimated consumption for DTF (collector in copper flotation) is 30 g/t.
v) Frother F-810 - Flomin
The flomin will be received in 200 liter barrels and will be stored (storage 50 barrels, equivalent to 90
days’ consumption). The Flomin will be pumped to the distribution tank (0,1% solution) and will be
distributed to the consumption points at copper flotation through positive displacement pumps. The
estimated consumption for FLOMIN F-810 is 20 g/t.
vi) Flocculent
The flocculent will be received in 25 kg plastic bags and will be stored in covered and protected place
near the reagent preparation warehouse (storage for 60 days of consumption). The flocculent is
prepared with water, 0.1% volume, in the complete system provided by vendor. The addition of
flocculent in concentrate and tailings thickeners will be done through metering pumps of positive
displacement. The estimated consumption for Flocculent (concentrate) is 20 g /t and for Flocculent
(tailing) is 25 g/t.
17.3 Design Criteria

The process design criteria for the Boa Esperança concentrator is based on findings from metallurgical
programs, input from various equipment vendors and testing facilities. The major process design
criteria are presented in this section.
September 7, 2017
17.3.1 Run of Mine Plant Feed Characteristics

• ROM top size, mm 600
• Ore specific gravity 3,3
• Bulk density, t/m 3
2,0
• Angle of repose, degrees 36
• Abrasion index, Ai(g) 0.356
• Work Index, kwh/t 17,6
• Moisture content, % 3.0
17.3.2 Production Schedule

• Ore crushing and milling rate, average, t/y 2,308,000
• Ore milling rate, average, t/y 1,500,000
Crushing Plant Production Schedule
• Days per year 365

• Hours per day 24
• Shifts per day 3
• Hours per shift 8
• Operating Availability, % 70
• Operating hours per year 6,132
• Nominal Crushing rate, tph 376.4
• Design crushing rate, tph 451.7
Grinding, Flotation and Concentrate Handling Schedule
• Days per year 365

• Hours per day 24
• Shifts per day 3
• Hours per shift 8
• Operating Availability, % 93.0
• Operating hours per year 8,147
• Nominal grinding rate, tph 184.1
Metal Production Schedule
• Copper recovery to concentrate, % 95.4

• Copper Concentrate Grade, Cu% 28 - 30
17.4 Plant Design and Equipment Characteristics

A list of all process equipment along with their characteristics for the Boa Esperança Project
concentrator is provided in the list of Mechanical Equipment showed in Table 17.1. Technical
specifications were prepared for each piece of major equipment.
September 7, 2017
Table 17.1: Major Equipment List for the Boa Esperança Concentrator
EQUIPMENT DESCRIPTION POWER (kW) GENERAL FEATURES MODEL
CRUSHING AND JIGGING
4005 BR 001 JAW CRUSHER 160 kW 1250 x 950 mm - APF: 110 mm METSO-C125
4005 TC 001 BELT CONVEYOR (JAW CRUSHER) 3.7 kW width=1000mm - length= 16m velocity=0.59m/s
4005 TC 002 BELT CONVEYOR (ORE PILE) 30 kW width=800mm - length= 112m velocity=1,20m/s
4010 TC 001 BELT CONVEYOR (PRIMARY VIBRATING SCREEN) 45 kW width=800mm - length= 190m velocity=1,20m/s
4010 PN 001 PRIMARY VIBRATING SCREEN 22 kW 2 decks- 60 / 20 mm (9,6 m2) METSO- XH 6' X 16' DD
4010 BR 001 SECONDARY CRUSHER 315 kW standard coarse - APF de 27 mm METSO-HP400
4010 TC 002 BELT CONVEYOR (PRIMARY VIBRATING SCREEN TO SECONDARY CRUSHER) 150 kW width=1000mm - length= 151,1m velocity=1,30m/s
4010 PN 002/003 SECONDARY VIBRATING SCREEN 2x27 +2x22 kW 2 decks-10 / 3 mm METSO- EF 8' x 32' DD
4010 TC 004 BELT CONVEYOR (SECONDARY SCREEN) 3.7 kW width=1000mm - length= 15,4m velocity=0,7m/s
4010 TC 005 BELT CONVEYOR (SECONDARY SCREEN) 45 kW width=800mm - length= 122,8m velocity=1,44m/s
4010 BR 002/003 TERTIARY CRUSHER 315 kW short-head finos - apf de 14 mm METSO-HP400
4010 TC 018/019 BELT CONVEYOR (SECONDARY SCREEN -3mm) 3.7 kW width=600mm - length= 20m velocity=0,6m/s
4010 TC 020 BELT CONVEYOR 22 kW width=600mm - length= 85,8m velocity=1,35m/s
4010 TC 021 TRIPPER 37 kW width=800mm - length= 130m velocity=1,20m/s
4010 TC 007 BELT CONVEYOR (-10 +3mm SECONDARY VIBRATING SCREEN) 3.7 kW width=800mm - length=16,4m velocity=0,85m/s
4010 TC 008 BELT CONVEYOR (-10 +3mm SECONDARY VIBRATING SCREEN) 18.5 kW width=600mm - length=45,4m velocity=1,4m/s
4010 PN 004 TERTIARY SCREEN 14.7 kW LH2448 - low head - 2 decks ( 6 e 3 mm ) Metso (2.4 x 4.8m)
4010 TC 009 BELT CONVEYOR 18.5 kW width=600mm - length=54,5m velocity=1,4m/s
4010 TC 010 REVERSIBLE BELT CONVEYOR 11 kW Kuttner Kuttner
4010 JG 001/002 JIG - Kuttner All jig G/F-3000X1860
4010 PD 001 DEWATERING SCREEN (JIG TAILING) 11 kW width=1600mm - length=5m (Kuttner) Kuttner
4010 PD 002 DEWATERING SCREEN (JIG CONCENTRATE) 2 x 2.7 kW width=1250mm - length=3,5m (Kuttner) with frequency inverter
4010 BO 003/004 JIG'S BLOWER 75 kW Kuttner pressure 45 kPa
4010 PD 003 DEWATERING SCREEN (JIG TAILING ) 11 kW width=1600mm - length=5m Kuttner
4010 PD 004 DEWATERING SCREEN (JIG CONCENTRATE) 2 x 2.7 kW width=1250mm - length=3,5m with frequency inverter
4010 BP 001/002 WATER PUMP (JIG ) 55 kW Kuttner Kuttner
4010 TC 011 BELT CONVEYOR (JIG TAILING) 3.7 kW width=600mm - length= 39,5m velocity=0,65m/s
4010 BP 003 JIG SLURRY PUMP 73,5 kW horizontal pump 6x4 AH - WEIR or similar
4010 TC 015 BELT CONVEYOR (JIG CONCENTRATE) 1.5 kW width=600mm - length= 14,5m velocity=0,62m/s
4010 TC 016 BELT CONVEYOR (JIG CONCENTRATE) 5.5 kW width=600mm - length= 45m velocity=0,62m/s
4010 BP 004/004R SLURRY PUMP 55 KW horizontal pump 6X4 WEIR or similar
4010 TC 017 BELT CONVEYOR ( OVERFLOW SECONDARY SCREEN) 5.5 kW width=800mm - length= 15,7m velocity=0,82m/s
4010 TC 014 BELT CONVEYOR (JIG TAILING) 37 x 2 kW width=600mm - length= 670m velocity=1,42m/s
4010 TC 022 BELT CONVEYOR 11 kW width=1000mm - length= 25m velocity=0,47m/s
GRINDING AND SCREENING
4015 TC 001 BELT CONVEYOR (BALL MILL) 11 kW width=600mm - length= 116m velocity=0,82m/s
4015 TC 002 BELT CONVEYOR (ORE STOCK PILE) 18.5 kW width=600mm - length= 95m velocity=0,82m/s
4015 MO 001 BALL MILL 3310 kW D = 18' x C = 23' METSO/OUTOTEC/CITIC
4015 BP 001/001R SLURRY PUMP (DERRIK SCREEN 4015-DK-001 A 008) 184 kW horizontal pump 250 MCR WEIR or similar
4015 DK 001 a 008 DERRICK SCREEN 8x2x1,8 kW Stack Sizer screen model 2SG48-60R/W - 5 STK Derrick
4015 BP 002/002R SLURRY PUMP (UNDERSIZE DERRICK SCREEN) 147 kW horizontal pump 8X6 AH WEIR or similar
FLOTATION
4020 BP 001 SLURRY PUMP (ROUGHER Cu FLOTATION) 92 kW horizontal pump 8x6 AH -Weir or similar
4020 MF 001 ROUGHER Cu FLOTATION 6. x 45 Kw 6 tank cell 30 m3 RCS-30 - METSO or similar
4020 BP 002/005 SLURRY PUMP (CONC. ROUGHER I TO PNEUMATIC CL. Cu) / (CONC SCV-CL Cu) 3,7 Kw / 1,5 kW vertical pump foam METSO VF50
4020 CP 001 CLEANER Cu FLOTATION 0.75 kW pneumatic JAMESON- Z1200/1- 01 downcomers
4020 BP 003/004 SLURRY PUMP (CONC. ROUGHER II TO REGRINDING) / (CONC CLEANER Cu) 11 kW vertical pump foam VF 150 - Metso or Similar
4020 CP 02 RECLEANER Cu FLOTATION 1.5 kW pneumatic JAMESON- E 1714/2- 2 downcomers
4020 MF 002 SCAVENGER OF CLEANER FLOTATION 8 x 22 kW 8 tank cell de 10 m3 RCS-10- METSO or similar
4020 BP 006/009 SLURRY PUMP (TAILINGS CLEANER/SCV Cu) / (C0NCENTRATE PYRITE FLOTATION) 147 kW 10 x 8 M Weir / horizontal pump 10x8 AH WEIR or similar
4020 MF 003 PYRITE FLOTATION 7 x 45 kW 7 tank cell 30 m3 RCS-30 - METSO or similar
4020 BP 007/008 SLURRY PUMP (TAILINGS PYRITE FLOTATION) / (CONCENTRATE Cu FLOTATION) 7,4 Kw / 18,4 kW vertical pump foam METSO VF100
September 7, 2017
17.5 Process Plant Operating Costs

Plant operating costs were estimated by Tecnomin. Costs were modeled as unit consumption rates
for each plant operation.
Results of this estimate are presented in Table 17.2.
Table 17.2: Plant Operating Costs – Summary
September 7, 2017
17.6 Plant Power

The basic engineering project determined the required power for all equipment, which was used to
calculate the total power demand and energy consumption of the Project. Table 17.3 shows the power
consumption rates that were estimated for each operation.
Table 17.3: Power Consumption Rates
17.7 Reagents
Costs with reagents are specifically related to the following:
• Sulfuric Acid;
• Lime;
• DTF;
• PAX;
• Flomin;
• Concentrate flocculants; and
September 7, 2017
• Tailings flocculants.
Consumption rates were based on bench scale metallurgical tests performed by SGS between 2011
and 2012. Table 17.4 shows considered consumption rates.
Table 17.4: Flotation Calculated Consumption Rates
17.8 Other Plant Consumables

Tecnomin prepared detailed consumption rates and wear parts for each plant operation. The following
tables present this information.
September 7, 2017
Table 17.5: Crushing & Screening Main Consumables & Wear Parts
Table 17.6: Mill Consumables
September 7, 2017
Table 17.7: Main equipment Spare parts
17.9 Plant Labor
September 7, 2017
Table 17.8: Plant Labor
Additional costs included in Labor G&A Burden, correspond to the size of the crew in each period of
the project. These costs include budgets to cover the following:
• Administrative salaries;
• Employees transportation;
• Meals;
• Safety Equipment;
• Uniforms;
• Medical assistance; and Life insurance.
September 7, 2017
17.10 Process Plant Water Balance

The water balance includes the water requirements for both raw water and recycled process water. A
fresh water requirement of 143 m3/hr is estimated and is based on an overall process plant water
requirement of 560,8 m3/hr with 552,0 m3/hr being provided as recycled process water. Water losses
of 156,3 m3/hr are estimated. It is assumed that the gland seal water for pumps, water for reagents
preparation, potable water and make-up water will be provided by clean raw water. The rest of the
water requirements within the process plant will be from recycled process water.
September 7, 2017
Figure 17-1: Simplified Process Flowsheet
September 7, 2017
18 Project Infrastructure
18.1 Site Access
The Project is located in the county of Tucumã, Pará State. The Project is only accessible by road and
is located approximately 42 km southwest from the nearest town of Tucumã. To reach the site, travel
west from Tucumã along state highway PA-279 to a village known as P5. This highway connects the
larger cities of Xinguara and São Felix do Xingu which flank the town of Tucumã. At P5, travel south
for approximately 16 km, on an unpaved road, to reach the project site. Figure 4-1 shows the general
area location of the Project.
Although there is no airfield in the project area and its neighborhoods, flights to the neighboring county
from Belém do exist, with a stop at Marabá, in a single-engine airplane. Flights leave the capital city
every day to Ourilândia do Norte, the nearby county located 6 miles from Tucumã.
18.2 Power
18.2.1 Load Requirement
The estimated power demand to support operations is approximately 9.1MW at peak demand.
18.2.2 Electrical Power Source

The public concessionaire, the Electrical Company of Pará (CELPA, Centrais Elétricas do Pará S.A.)
supplies the region with electrical power. Initial discussions with CELPA have confirmed that excess
electrical power is available within the region. The power for the project will be sourced from the
regional grid within the county of Tucumã. A new 138 kV high voltage, three phase, 60 Hz transmission
line branch, approximately 15 km long, tied into the grid along the power line from Tucumã to Sao
Felix do Xingu will be installed. The tie-in will be 25 km west of Tucumã near Vila P5. The selected
route will follow the access road to the site and is shown in Figure 16-1. Type “SS1!-PR” Double-T
reinforced concrete poles will be used to carry the transmission line. The transmission line will enter
the site from the north terminating at the main substation (5090-SE-01) located adjacent to the
administration building.
18.2.3 Main Substation

The transmission line will terminate at the main substation (5090-SE-01SE-01) at the mine site.
The main substation shall be an external area for high voltage equipment, power transformer, power
factor correction and harmonic filtering equipment and a control house.
The following systems shall integrate the main substation set:
a) On the external area
• Grounding;
• Lightning Protection System;
September 7, 2017
• Ground Fault Current Limitation;

• Outdoor measuring and protection transformers (TP’s and TC’s).
b) On the control house
• Billing meter (equipment by CELPA);

• Reliable tension;
• Common and emergency lighting;
• Supervision, control and protection;
• Fire detection, alarm and fighting;
• Air conditioning and pressurization;
• Safety signaling and escape routes.
The transformer of main substation shall be of oil immersed type, rated voltage 138/13.8 kV, rated
power 15/18.75 MVA and ONAN (Oil Natural Air Natural)/ONAF (Oil Natural Air Forced) cooling
method.
The system will be grounded through the grounding resistors, thus ensuring low value short circuit
earth phases and a high degree of system reliability; i.e., energy availability.
The main substation will feed seven secondary substations for the following powered locations:
• 5005-SE-01 – Primary Crushing Area Substation;

• 5010-SE-01 – Re-Crushing, Jigging and Screening Area Substation;
• 5015-SE-01 – Grinding, Re-milling, Thickening, Flotation and Water Distribution Area
Substation;
• 5020-SE-01 – Filtering, Reagents and Air Distribution;
• 5030-SE-01 – Raw Water Capture;
• 5035-SE-01 – Wastewater Capture, and;
• 5040-SE-01 – General Area Substation
All the secondary substations will have transformers for lighting the industrial areas, administration
area and feeding the non-industrial power with secondary voltage of 220/127 V.
For Instrumentation, Control and Automation feeding system, will be installed a secondary voltage
transformer with an output of 199/115 V.
The power factor correction will be done in the medium voltage (13.8kV) by main substation, so that
the power factor of the system stays above the required standards.
18.2.3.1 5005-SE-01 – Primary Crushing Area Substation

Substation 5005-SE-01 primarily services the primary crushing station. The substation shall be in civil
construction (masonry type), with two levels. A cable room and transformer bay shall be built below
the panel room.
The 5005-SE-01 will include the following equipment set:
• 13.8 kV medium voltage switchgear air insulation (MVS-AIS), with one input and two outputs;
• 13.8/0.46 kV dry type transformer, rated power 500 kVA;
• Low voltage grounding resistor;
September 7, 2017
• 460 V motor control center (MCC);

• Lighting and control transformers;
• Batteries and charger to electrical control and protection system;
• Programmable Controllers Panel and UPS.
18.2.3.2 5010-SE-01 – Re-Crushing, Jigging and Screening Area Substation;

Substation 5010-SE-01 primarily services re-crushing, jigging and screening circuits. The substation
shall be in civil construction (masonry type), with two levels. A cable room and transformer bay shall
be built below the panel room.
• 13.8 kV MVS-AIS, with one input and four outputs;

• 13.8/0.46 kV dry type transformers, two units with rated power 1000 kVA;
• Low and medium voltage grounding resistors;
• 460 V motor control center (MCC), two units;
• Low voltage panel of soft starters and frequency inverters;
18.2.3.3 5015-SE-01 – Grinding, Re-milling, Thickening, Flotation and Water Distribution Area
Substation
Substation 5015-SE-01 primarily services the Grinding, Thickening, Flotation and Water Distribution
circuits. The substation shall be in civil construction (masonry type), with three levels. A cable room
and transformer bay shall be built below the panel room. In the third floor will the control room
operations.
• 13.8 kV MVS-AIS, with one input and five outputs;

• 13.8/0.46 kV dry type transformers, two units with the rated power 2000 kVA;
• Low voltage switchgears, two units;
• 460 V motor control center (MCC), four units;
September 7, 2017
The substation 5015-SE-01 will provide emergency power service to the critical systems serviced by
this substation. The emergency generator will be rated power 180kW.
18.2.3.4 5020-SE-01 – Filtering, Reagents and Air Distribution

Substation 5020-SE-01 primarily services the primary Filtering, Reagents and Air Distribution circuits.
The substation shall be in civil construction (masonry type), with two levels. A cable room and
transformer bay shall be built below the panel room.
• 13.8 kV MVS-AIS, with one input and three outputs;

• 13.8/0.46 kV dry type transformers, rated power 1500 kVA;
• Low voltage switchgears;
• 460 V motor control center (MCC), two units;
18.2.3.5 5030-SE-01 – Raw Water Capture and 5035-SE-01 – Waste Water Capture
Substation 5030-SE-01 primarily services the raw water capture and 5035-SE-01 services waste water
capture. The substations, 5030-SE-01 and 5035-SE01 are similar. The substations shall be in civil
construction (masonry type), with one level and the transformer mounting in concrete post. The cable
route will by floor ducts, which shall be above ground level. The substations will include the following
equipment set:
• 13.8/0.46 kV oil immersed type transformer, rated power 75 kVA;

18.2.3.6 5040-SE-01 – Auxiliary Buildings and Facilities

Substation 5040-SE-01 will service the auxiliary buildings and facilities including the administration
building and offices; laboratory; warehouse, process operations workshop, mine dry, mine equipment
maintenance shop, truck wash, gatehouse, fuel/lube storage/dispensing area, core shed and
nonindustrial areas.
The 5040-SE-01 shall be in civil construction (masonry type), with one level and the transformer bay
near to the panel room. The cable route will by floor ducts, which shall be above ground level.
The substations will include the following equipment set:
September 7, 2017

• Low voltage switchgears;
• Lighting, control transformers and UPS.
18.2.4 Electric Power Distribution

The electric power distribution in medium voltage in 13.8 kV, between the main substation and
secondary substations will be done through overhead distribution network compact type. The compact
network uses shielded cables and spacers and in the case of the project will be used concrete poles.
The foreseen networks may associate the distribution in medium voltage and low voltage distribution
for street lighting and telecommunication circuits.
Buried or air stretch both types with be installed with insulated cabling to prevent accidents due to the
proximity of equipment or risk of involuntary contact.
The feed circuits will always use insulated cables and their path between the substation and the load
will be the primary cables route (channels, beds for cables, ducts networks).
Preferably the power cabling will be arranged in apparent conduits (cabling beds and conduits), but
may occur embedded stretches on the floor.
The installation of low voltage cables overhead lines is allowed only for lighting circuits, this is the
multiplexed cabling type are used.
18.3 Water Supply

The hydrogeological studies were conducted by the MDGEO Hydrogeology Services in the period of
January to November 2011, comprising the following steps:
• Inventory of water sources and users;

• Flow measurements in major drainages;
• Preparation of hydrogeological conceptual model;
• Evaluation of impacts to water resources;
• Assessment of water availability; and
• Projection of the monitoring network.
The inventory of water points and users consisted in the registration of all water points; resurgences
of underground water, headwater drainage, piezometers, deep tubular wells, wells, ponds, drainage
galleries, slope drains, drains and other structures for water capture.
The results of the aquifer tests studies were used to develop a conceptual hydrogeological model of
the area. The model was used to understand the behavior of the underground water system, and to
provide information for a preliminary assessment of water resources in the region as possible water
supply alternatives.
The hydrogeological system in the region has the typical characteristics of formations located in
crystalline basement aquifers. This is an aquifer consisting of a shallow weathered mantle with metric
September 7, 2017
thickness (Porous Aquifer), superimposed over the crystalline basement (Fractured Aquifer), deformed
and fractured.
Water for construction activities will be sourced from the underground aquifer via semi artesian wells
to a depth of 80 m. These wells have a production rate of 7.6 m3/hr which is believed sufficient to
support the non-potable water needs during the construction phase. During construction, it is the
responsibility for the contractor to supply the necessary potable water requirements
According with studies produced by Tecnomin, the water balance includes the water requirements for
both raw water and recycled process water. A fresh water requirement of 143 m3/hr is estimated and
is based on an overall process plant water requirement of 560,8 m3/hr with 552,0 m3/hr being provided
as recycled process water. Water losses of 156,3 m3/hr are estimated. It is assumed that the gland
seal water for pumps, water for reagents preparation, potable water and make-up water will be
provided by clean raw water. The rest of the water requirements within the process plant will be from
recycled process water.
Regarding the water supply for the Boa Esperança Project, the initial plan was to divert water from
Carapanãzinho creek. However, studies have shown that the use of Carapanãzinho creek, as well as
other streams within the area surrounding the project, is not viable due to their intermittent depth and
flow.
The water pond will have the purpose of storing clean water to meet the demand of the plant, estimated
at a flow of 150m³/hour, working for a year without interruption. The water pond will be located in the
Jatobá stream, within the area owned by MCSA.
The embankment of the dykes will be constituted of a homogeneous section of compacted soil. The
defined geometry shows a dam crest at Elev. 240.0 m with 10.0 m width. The upstream and
downstream slopes exhibit a declivity of 1V:2.0H.
18.4 Ancillary Buildings and Facilities

18.4.1 Administration Building and Offices
The administration building will be a 1,197 m2, single-story, concrete block with a galvanized steel tile
roof construction. The building accommodates the operation’s general manager, administrative,
human resources, accounting and legal personnel, security, I.T., exploration, mining and processing
management and engineering teams, quality control, maintenance management, and environmental
management personnel. Additionally, the building has several conference rooms, accommodations for
training of personnel, a copy room, rest rooms and a break room.
18.4.2 Laboratory
The laboratory building will be a 715 m2, single-story, concrete block with a galvanized steel tile roof
construction. The laboratory is designed for three essential functions: to check the mine and mill
operations; to establish the mill balance, and to make investigations necessary for operations
improvements.
September 7, 2017
The space is divided into three zones. The main zone for sample receiving, pulp preparation, scale
room, X-ray room, the physical and chemical analytical laboratory with supporting reagent and sample
storage rooms. The second zone is for dry sample crushing, grinding and screening. The third zone is
for office for lab staff, a meeting room, rest rooms, and break room.
18.4.3 Warehouse and Yard Storage

The warehouse complex is composed of one building and a fenced-in open yard. The building will be
1,500 m2, extended height, combination concrete block and steel siding walls with galvanized steel tile
roof construction. Part of the upper wall of the warehouse storage area will be constructed of fiberglass
translucent panels. The building space is divided into a receiving area, a distribution area, a secure
storage room, and covered storage. Additionally, there are offices for the warehousing staff, rest
rooms, and a break room. The external open storage compound has an area of 10,000 m2 for storage
of bulk and large items, as necessary. This area is secured by a 2 m tall galvanized chain-link fence.
This yard space is accessible either through the warehouse building or from an external gate.
18.4.4 Process Operations Workshop

The process operations workshop building will be a 432m2, extended height, combination concrete
block and steel siding walls with galvanized steel tile roof construction. The building is divided into a
work area and a storage/office area that are separated by a concrete block wall. The workshop work
area is outfitted to perform maintenance and repair service of the process plant equipment. It is
equipped with a 3-ton bridge crane that can span the length of the shop floor. The work area itself is
partitioned into specific work stalls to accommodate cutting, drilling, lathing, planning, and welding
operations. Additionally, there are specific work areas for assembly and work rooms for electrical
equipment and instrumentation. The opposite end of the work shop houses a boiler room. In separate
and secure area adjacent to the shop building are storage and distribution systems for acetylene and
liquid oxygen.
The storage/office area includes secure rooms for tools and components along with office space for
staff handling the planning, coordination and supervision of plant maintenance operations.
Additionally, there are a break room and restroom facilities for the staff.
18.4.5 Mine Dry

The mine dry building will be a 360m2, single-story, concrete block with a galvanized steel tile roof
construction. The dry has a change room with lockers, showers, and lavatory facilities for 66 women
and 468 men.
18.4.6 Mine Equipment Maintenance Shop

The mine equipment maintenance shop will be comprised of one building with two floors sharing a
common wall. The maintenance shop building will be an extended height steel frame structure with a
10 m work height and it will have eight, 6 m x 12 m, maintenance bays for a total area of 828 m2. The
steel frame structure will have open bay entries along one side and galvanized steel siding combined
September 7, 2017
with sections of translucent fiberglass panels covering the end walls and back wall under a galvanized
steel tile roof. The maintenance bay breakdown is as follows:
• 6 bays for light vehicle and heavy vehicle repair;
• 1 bay for tire changing;
• 1 bay for lubrication; and
• 1 bay for track equipment repair (railed floor).
The maintenance bays will be serviced with a 10 T bridge crane. Also, housed in this building is a
dedicated boiler in support of washing activities. The floor will have collection trenches leading to an
in-floor collection sump with oil/water separator to capture the wash runoff.
The connected building will be a two-story structure with a 480 m2 each floor. The building will be
constructed of concrete block exterior walls, a sound insulated common wall and covered with a
galvanized steel tile roof. The lower level of the building will house the shop support equipment
including the compressor room, electrical substation, tire storage and tire changing equipment, a
machine shop, a welding shop, an electrical shop, acetylene and oxygen cylinder storage, parts
storage, lube container storage, lavatories and a break room. The second floor will have offices for
electrical and mechanical maintenance managers, maintenance foremen, meeting rooms, restrooms,
and break room.
18.4.7 Truck Wash

The truck wash building will be an extended height steel frame structure two bay, one 6 m x 17 m for
rubber tired equipment, and one 8 m x 17 m for tracked equipment having a total area of 340 m2.
The steel frame structure will have open bay entries along one side and galvanized steel siding
covering the end walls and back wall under a galvanized steel tile roof. There are three raised
platforms; two platforms are at the outer sides of the bays and one common platform shared by both
bays. The floor under each bay will have collection trench at each end and a centered pit. Collected
wash water is treated by an oil/water separator. The tracked equipment bay will be reinforced with
rails.
18.4.8 Explosives Storage Magazine

The explosive storage magazine will be a 420 m2, single-story, raised, concrete block/steel frame
structure with an asbestos cement roof shingle construction. The perimeter of the buildings will have
a screened opening for natural ventilation. The buildings will be raised approximately 1 m from grade
and incorporated around ¾ of the building perimeter will be a 3 m trench located approximately 5 m
from the building walls. The front of the building will have a 35.2 m long x 3 m high trapezoidal shaped
earthen barricade. The building will be sized to maintain a 15-day stock of explosives.
18.4.9 Gatehouse and Weigh-Scale
September 7, 2017
The gatehouse building will be a 108m2, single-story; combined galvanized steel siding and concrete
block wall structure with a galvanized steel tile roof construction. The gatehouse controls the access
and departure from the mine property. All visitors must enter and exit through this facility.
Incorporated within the facility will be a truck weigh-scale for inventory control to monitor both incoming
and outgoing traffic. Also, there will be a secondary access for through vehicles not requiring weigh-
in. Incorporated into the structure will be a reception area, visitor waiting room, training room, lavatories
(special needs accessible per NBR-9), and a break room.
18.4.10 Fuel and Lube Storage

The project will have a gas fuel, diesel fuel and lube storage and dispensing facility. The building will
be a 360 m2, extended height, combination concrete block and steel siding walls with galvanized steel
tile roof construction. There will be an administration office, lube warehouse in conjunction with a break
room and restroom facilities. There will be a covered, three bay fuel dispensing area, two for light duty
trucks and one for heavy equipment. The diesel fuel capacity of the storage tanks has yet to be
determined by MCSA. The dispensing facilities (storage and pumping station) will be leased from the
supplier.
18.4.11 Core Shed

The project will have a core shed to receive, prep, log and archive core. The building will be a 108m2,
extended height, combination concrete block and steel siding walls with galvanized steel tile roof
construction. Additionally, there are a break room and restroom facilities for the staff.
18.5 Other Services

18.5.1 First Aid Clinic and Fire Protection Building
The operations will be supported by a first aid clinic and fire brigade to handle respective situations.
Both services will share a common building. The building will be a 235 m2 concrete block structure
with galvanized steel tile roof construction.
The structure will garage both an ambulance and a fire fighting vehicle. Additionally, there will be a
storage room for firefighting equipment, tools and materials used in that service.
18.5.2 Fire Protection

The firewater distribution system will consist of a dedicated buried fire water main and hydrant system.
The system will be designed to meet the requirements of NFPA 14. Water will be stored in a dedicated
Fire Water tank (120 m3). The distribution system will be sized for rated flow rate of 114 m3/hr at 50 m
and will be comprised of an electric firewater pump (primary), a diesel firewater pump (back-up) and
incorporate a jockey pump (3.6 m3/hr at 125 mca) to maintain line pressure.
Fire alarm panels, flow devices, pressure switches, alarm valves, pull stations, detectors and audible
alarms will be installed at protected areas. Hose stations will be located near hydrants equipped with
two valves, each connected with 60 m, 2 ½ inch diameter hoses and adjustable jet to fog nozzles.
September 7, 2017
18.5.3 Canteen
The project will have a canteen to provide meals to 215 persons, composed of the 180 operational
staff plus a 20% overcapacity. This building will be a 700 m2 single level, concrete block with
galvanized steel tile roof. The dining hall will have a seating capacity for 90 occupants.
The building will have a receiving dock to accept incoming supplies. There will be facilities to store
meats and grains for 15-days, fruits and vegetable for 7-days. Highly perishable goods will be brought
in on a daily basis. The kitchen will have separate food prep areas for meats, fruits/vegetables and
desserts in conjunction with the expected kitchen, serving rows and dishwashing areas. Additional
facilities will include: men’s and women’s lavatories, a utility room and a dry garbage room.
18.5.4 Sewage Treatment

The sewage generated on the project operation will be collected and treated. Each building will
incorporate an independent sewage treatment module. The proposed sewage treatment will be
handled through a network of collectors which transfer the raw waste water to septic tanks. The septic
tanks will remove many of the settleable solids, oils, greases and floating debris in the raw waste
water. The outflow from the septic tank will be routed to fixed media anaerobic filters for additional
treatment to lower septic tank effluent biochemical oxygen demand (BOD) and total suspended solids
(TSS) concentrations prior to discharge to a subsurface wastewater infiltration system (SWIS). The
captured solids will be periodically pulled by mechanical means.
18.5.5 Refuse Storage

Over the life cycle of the operation, several forms of domestic and industrial waste will be generated.
In an effort to reduce, reuse and recycle such waste materials the project will separate and store this
refuse per the requirements of ABNT NBR 10004 – Solid Waste Classification.
To support the classification of materials, the project will have a multi-bay building to segregate the
refuse. The building will be an extended height, combination concrete block and steel siding walls
structure with galvanized steel tile roof and a floor area of approximately 308 m2.
The building will have nine separate bays of varying size accessible via a center corridor spanning the
length of the building. The bays will be designated to store the following recyclable materials and/or
contaminants:
• Oil;
• Grease;
• Batteries;
• Light bulbs;
• Wood;
• Aluminum;
• Other non-ferrous metals;
• Plastics; and
• Paper.
September 7, 2017
The bays which will be used for storing lubricating products and contaminants shall be provided with
appropriate coatings and incorporate a containment channel leading to an oil / water separator /
collector.
18.5.6 Communications
The telecommunications design will incorporate proven, reliable systems to ensure personnel at the
mine site will have adequate data, voice and other communications channels available. The base
system will be installed during the construction phase then expanded to encompass the operating
plant.
The design will include:
• Two-way radio communications at site;

• Single-channel radio communications;
• A Voice-over Internet protocol (VoIP) telephone system; and
• Satellite internet access,
Technologies and services to be provided include the following:
Construction phase:
• Radio communication via Motorola, model EP450 portable two-way radio will be used at the
site. Connectivity is enhanced with on-site repeater to extend radio coverage between the Boa
Esperança and Tucumã.
• Single-channel radio communications via Brasco, model MAO-XV or Audiocodes Gateway
equipment. This is temporary and will be replaced with VoIP telephone.
• VoIP telephone via an Intelbras, model Impacta 68, for direct line dial with 6 to 8 phone lines.
• Internet service via local supplier, bandwidth 2MB limit.
• Mobile telephone – no service.
Operation phase:
• Radio communication maintains the services from above.

• VoIP telephone to migrate to a Siemens HiPath Series 3800 to increase capacity to 30
channels.
• Internet service via local supplier, bandwidth 4MB via satellite or optical fiber.
• Mobile telephone – service implementation to be investigated in the future.
18.6 Off-Site Infrastructure

18.6.1 Transportation of Concentrate
The project will be transporting copper concentrate (30% copper) from the site to the port of Vila do
Conde, Barcarena, PA. Trucks will drive north along the improved P5 road to PA-279 then east toward
Tucumã until Xinguara, and then they will follow BR-155 north to PA-475 and then onto PA-151 to the
port destination. The total travel distance is approximately 897 km, one-way. Figure 18-3 shows the
map of the preferred transportation route, “Alternative A”.
September 7, 2017
The truck transportation proposed for the haulage of the concentrate will be via a road train trucking
concept pulling two trailers tied together by a fifth wheel. The current Brazilian standard for these trucks
are 7-axle units (20 m long) however, there is a trend for using a longer B-Train (or B-Double) 9-axle
units (30 m long).
18.6.2 Road Detail

P-5 Access
• Connects: Boa Esperança project to PA-279;

• Length: 15.5 km;
• Road Condition: Current is unpaved and poor. This road will be upgraded for the main site
access as part of the project development; and
• Average Speed: 30 km/hr.
As indicated above, this road is currently an unpaved hard-pack earthen road from the village of P5
and will require an upgrade to a gravel road to accommodate heavy equipment and consumables
delivery during Project construction and to support the project operations and concentrate transport.
A detail design has not been performed on the road improvements; however, the road goes through a
region of flat topography, elevations and depression which will require the installation of bridges,
culverts, along with earthworks for the development of drainage galleries, cut and fill. Benefits from
the upgrades will be achieved with the following improvements:
• Design speed: 50 km/hr;

• Maximum grade: 5%;
• Road width: 10 m;
• Deep Ditch Line:40 cm;
• Cap thickness: 15 cm; and
• Cap material: surface gravel.
Figure 18-4 shows the routing of the access road to the location of the project.
PA-279 Road
• Connects: São Félix do Xingu – Tucumã – Xinguara;

• Length: 260 km;
• Road Condition: Paved and acceptable between Tucumã and Xinguara; and
PA-279 is known to be in poor and dangerous condition even though it is paved. The Project has no
current plans to maintain this road as it is the responsibility of the state government.
BR-155 Road
• Connects: Redenção to Marabá;

• Length: 344 km;
• Road Condition: Paved, however, road has degraded in areas and considered poor to
dangerous. Upgrading is anticipated to be paid by the federal government; and
September 7, 2017
Similar to PA-279, BR-155 is identified as a road in poor and dangerous condition. Likewise, the project
has no current plans to maintain this road as it is the responsibility of the federal and state government.
PA-257:
• Connecting: Carajás – Parauapebas - Eldorado dos Carajás

• Length: 150 Km
• Present situation: Paved (acceptable conditions)
• Average Speed: 80 km/h
• Investments: NIL
BR-150 / PA-475 / PA-252:
• Connecting: Marabá – Barcarena (Vila do Conde)

• Length: 546 Km
• Present situation: Paved (poor conditions)
• The bridge in the Moju River (PA-252) collapsed after an
• accident. Alternative route is 70 km longer.
PA-160:
• Connecting: Parauapebas – Canaã dos Carajás

• Length: 50 Km
• Present situation: Paved (acceptable conditions)
Água Azul do Norte – Canaã dos Carajás
• Connecting: Água Azul del Norte – Canaã dos Carajás

• Length: About 71 Km
• Present situation: 53 Km unpaved (acceptable) – 18 km paved (good)
• Average Speed: NIL
18.6.3 Port – Vila do Conde

The port of Vila do Conde was opened in October 24, 1985 and is managed by Companhia Docas do
Pará (CDP). The port is located along the right bank of the River Pará of the Bay of Marajó in the city
of Barcarena, Pará. The location is called Ponta Grossa and is the confluence of the Amazon,
Tocantins, Guamá and Grass waterways. This small port provides a regional connection with the world
(Figure 18-5).
The pier is built in the shape of a “T” with a 378 m bridge and six berths along the horizontal bar. Berths
101 and 102 are used for dry bulk goods and general cargo. Berth 101 (external) 290 m long is
September 7, 2017
dedicated import/export handling of bauxite, coal. Berth 102 (internal) 242 m long is available for public
use and handles the unloading and loading of pet coke, pitch and alumina.
Berth 201 (external) 250 m long is used for aluminum, pig iron, kaolin and manganese ore. Berth 202
(internal) 250 m long is used for general cargo and bulk liquids (fuel oil). Berths 301 (external) and 302
(internal) each 254 m long are used for loading/unloading general cargo and containers.
Port Detail and Restrictions:
• Maximum allowed draft: 12.20 m;

• Estimated loading rate: 5.000 MT/d;
• Maximum vessel length: 250 m;
• Maximum cargo intake: 50,000 MT/vessel (Supramax); and
• Hours of operation: 24 h/d.
A new multiport terminal port, TMU2, will be leased this year by CDP to Vale S.A. as they need more
space to handle their import of coal for ALPA and the export of steel. With the opening of this new
facility, it is anticipated that congestion at the present port of Vila do Conde will be reduced.
18.7 Tailings Storage Facilities

The VOGBR developed the Basic Design of the B2 Dam and the Conceptual Design of the Water
Pond that will be implemented at the Boa Esperança Mine. The dams will have distinct purposes as
shown below.
18.7.1 Water Pond

The reservoir of the water pond will have the purpose of storing clean water to meet the supply
demands of the plant, considering a flow of 150 m³/hour during uninterrupted operations for a year. In
December 2014 MCSA contracted VOGBR to develop the current work. The Water Pond will be built
in the Jatobá Creek, within the limits of the MCSA properties. Technical report no. VG14-168-1-EG-
RTE-0004 shows the Conceptual Design of the Water Pond.
18.7.2 B2 Dam
The reservoir of the B2 Dam will have the purpose of containing the hazardous tailings resulting from
the copper ore beneficiation and to recover water in order to limit the use of new water, minimizing the
need to collect water in the waterbodies of the region. In December 2014 MCSA contracted VOGBR
to develop the current work. At that time, the construction of a waterproof dam constituted by a
compacted soil embankment to meet the new tailings volumes generated in the Boa Esperança
Copper Mine project was assessed. The considered operational life of the mine for the tailings volume
to be generated was 11 years. The technical report no. VG14-168-1-EG-RTE-0005 contains the Basic
Design of the B2 Dam.
The tailings to be deposited in the B2 Dam will classified according to the ABNT NBR 10.004/2006
Standard as Class I tailings (hazardous). Since the tailings are Class I the B2 Dam shall be watertight
September 7, 2017
observing a minimum layer of non-saturated soil of 1.50m, measured between the bottom of the
deposit and the critical water level. In addition, the design shall include the definition of the leak
detection system and waterproofing system.
18.7.3 Geological-Geotechnical Surveys and Field Laboratory Tests–B2 DAM

18.7.3.1 Geological-Geotechnical Survey
The Table 18.1 exhibits a summary of the drillholes and the tests conducted on site in the B2 Dam
area, while Table 18.2 exhibits the summary of the surveys and tests performed on site in the borrow
area.
Table 18.1: Summary table of the survey held in the foundation area of the B2 Dam
September 7, 2017
Table 18.2: Summary table of the surveys conducted inside the borrow area of the B2 Dam.
18.7.3.2 Laboratory Tests

In the foundation area of the B2 Dam survey samples were extracted from the test pits. However, the
characterization tests and special tests were conducted only on samples PI-01 e PI-03 since the PI-
02 sample exhibited predominantly organic characteristics, which indicates the need to remove this
layer during excavations. Table 18.3 shows a summary of the tests and types as well as the quantities.
Table 18.3: Test campaign executed in the area of the B2 Dam foundation
To characterize the area with potential for clay material borrowing (building of the embankment fill)
representative samples were extracted from the auger holes in the pit area, for the laboratory
geotechnical tests.
Characterization, compacting, variable load permeability and special tests were conducted in these
samples. Table 18.4 shows a summary of the tests executed and includes the quantities and types of
tests performed.
September 7, 2017
Table 18.4: Test campaign executed in the borrow area of the B2 Dam
18.7.4 Dam Layout

18.7.4.1 Water Pond
The layout of the Water Pond was designed for the storage of clean water, in order to ensure a supply
of uninterrupted 150m³/hour during one year for the plant that will perform the processing of Boa
Esperança Mine copper ore.
The embankment of the dykes will be constituted of a homogeneous section of compacted soil. The
defined geometry shows a dam crest at Elev. 240.0 m with 10.0 m width. The upstream and
downstream slopes exhibit a declivity of 1V:2.0H. Figure 18-1 shows a typical section of the Water
Pond.
Figure 18-1: Typical Section of the Water Pond.
18.7.4.2 B2 Dam
The B2 Dam layout was designed for the containment of approximately 0.77 Mm³ of tailings generated
in the processing of the copper ore of the Boa Esperança Mine during a period of 11 years of operation
of the industrial plant.
September 7, 2017
The B2 Dam embankment will be constituted by a homogeneous section of compacted soil. The
defined geometry shows the dam crest at Elev. 254.0 m and 10 m width. The upstream slopes exhibit
a declivity of 1V:2.5H, 5.0m high benches and 4.0 m berms. The downstream slopes between berms
exhibit a declivity of 1V:1.7H.
The building sequence of the B2 Dam basically includes the vegetation clearing, organic soil removal
and material removal until the adequate layer of material for the foundation is reached. Subsequently
the construction of the embankment with the launching, spreading and compaction of the materials
that constitute the B2 Dam.
The borrow materials planned for use in the execution of the embankment may be derived from the pit
topsoil stripping from mandatory excavations at other units of the project or borrow areas in the vicinity
of the embankment, provided that their geotechnical characteristics have been verified.
The waterproofing system on the bottom and on the slopes of the B2 dam reservoir will be comprised
of two waterproofing layers separated by a leak detection system; which has the purpose of collecting
and transporting any seepage material in the event of a leak in the upper waterproofing layer to the
collection boxes located on the outside of the reservoirs.
18.7.5 Final Considerations

The studies and dimensioning executed in the basic design of the B2 Dam and the Conceptual Design
of the Water Pond were developed according to the criteria and premises defined at the start of the
design development together with MCSA.
The volumes of the materials constituting the embankments, excavations, treatments and drainage
and transition systems of the dams were estimated within the accuracy made possible according to
the data available at this phase of the design.
September 7, 2017
Figure 18-2: Potentiometric map referred to June 2011 in the region of Boa Esperança Project and its surroundings
September 7, 2017
Figure 18-3: Road Route from Project to Port
September 7, 2017
Figure 18-4: Routing of Site Access Road P5
September 7, 2017
Figure 18-5: Vila do Conde Port
18.8 Logistics
18.9 Introduction
It is understood from MCSA that the Boa Esperança project will be a mining complex composed of
one site location in the district of Tucumã, PA.
Based on the above information, SRK has compared distances, logistic alternatives and bottlenecks
from Tucumã, PA through 2 different loading ports: Vila do Conde and Itaqui.
Copper concentrates are supposed to ship in bulk to Europe and Asia, and are negotiated in parcels
of 5,000 mt (or multiples) plus 8-9% of humidity (wet metric tonnes). Typical delivery sizes, by example,
are then: 5,400 wmt – 10,850 wmt – 16,300 wmt.
Smaller parcels of copper concentrates may also be loaded in container, which offers more flexibility
in terms of schedule, destinations and volumes.
The goal of the logistics study is the development of an analysis of logistic conditions to define:
September 7, 2017
• Transportation cost survey;

• Definition of main limitations through the logistic chain;
• Bottlenecks;
• Uncertainties.
In order to compose a total cost, we may divide this logistic chain into three main legs:
1. Ground Transportation
2. Port Operations (reception-warehousing-loading till FOB)
3. Ocean freight transport
18.9.1 Design Concepts

As a general rule, the analysis and design selection was based on:
• Safety of the persons and goods;

• Costs & benefits;
• Risk analysis;
• Conflict & contingency planning;
• Applicable laws & regulations;
• Social controversies;
• Sustainability.
It should be borne in mind that:
• Some of the conclusions and judgments made for this work depend on authorizations from
transport, road and infrastructure authorities;
• Due to the nature of the report, only limitations and possible bottlenecks that have more
relative importance have been analyzed.
18.9.2 Design Parameters – Expected flow and project schedule

In order to find a cost matrix, which allows us to forecast the viability of the logistics for the Boa
Esperança Project, some parameters have to be taken into account:
• Due to changes that may occur in the market, services, exchange rate, and infrastructure, it
must be noted that all given costs consider the current market situation and can suffer
variations;
• For this study, the following volume is predicted:
• 100,000 WMT / year Copper Concentrates
• Value of the copper concentrate: USD 1,750 - 1,800 / ton;
• Delivery capacity = Min. 400 WMT / day;
• Loading ports must have a covered area/warehouse with suitable conditions to stock a
constant pile of minimum 15,000 WMT and should be capable to perform a loading rate (from
warehouse to vessel) of minimum 5,000 WMT / day;
• Figure 18-11 shows the basic design parameters to be considered for an annual volume of
100,000 WMT/y;
September 7, 2017
Figure 18-6: Design parameters for an annual volume of 100,000 WMT/y.
18.10 Ground Transportation

18.10.1 Truck Transportation
The road transport could be optimized by using B-trucks, which consist of two trailers linked together
by a fifth wheel. Most companies in Brazil use B-trucks with 7 axles (20 m long), but several companies
buy equipment with 9 axles (30 m long).This kind of truck could replace 2-3 regular trucks.
Some advantages of the B-trucks are:
• More cargo capacity;

• Less consumption per transported MT (more efficient);
• Better maneuverability;
• More security;
• Easy to operate;
• Less contamination.
Figure 18-7: B-trucks with 9 and 7 axles.
September 7, 2017
The main advantage of the truck transport is the absence of transfer areas, reducing CAPEX costs
and cargo loss.
As a rough estimate for determination, for above mentioned quantity, a continuous cycle of
approximately 20 trucks would be necessary to cover a distance of 968 Km till Vila do Conde:
Table 18.5: Truck requirements to have a continuous operation.
18.11 Port Analysis

In order to combine the ground transportation with the most capable ports, 2 possibilities have been
selected: Vila do Conde-Barcarena, PA and Itaqui-São Luis, MA.
The ports analyzed must have a reasonable port draft (min. 10.00 m) with an acceptable loading
operation (min. 5.000 WMT / day).
Considering the production capacity of Boa Esperança and dimension of the parcels to be exported,
vessels between 6,000 dwt (Heavy-Lift/Multipurpose) and 45,000 dwt (Handysize type) would be the
most suitable for this kind of Project. The smaller size would be for full cargo solutions, the larger size
for part cargo solutions, keeping in mind that in the region there are several cargo combination
possibilities (woodpulp, kaolin clay, aluminum ingots).
Container is also an option for smaller parcels. Vila do Conde is attended by several container ship-
owners, which represent a valid alternative to bulk operation.
September 7, 2017
18.11.1 Vila do Conde

Restrictions:
• Port congestion: Expected. Currently about 5 days.

• Maximum allowed draft: 12.00 m
• Estimated loading rate: 5,000 MT / day
• Maximum cargo intake: 50,000 MT / vessel (Supramax)
• Working time: 24 hrs of operation
The port has a historical problem of congestion due to the high number of vessels, which could be
aggravated considering the large investments of the companies in the Brazilian North Region. Average
waiting time is reported to be 5 days at the berth where copper concentrates would be loaded,
competing with aluminum ingots, manganese ore and live cattle loading, as well as other import and
export products.
Port infra-structure: The public port is receiving investments. The number of piers was increased to 8
which improved loading and discharge capacity and reduced waiting time.
Figure 18-8: Vila do Conde Port.
The port of Vila do Conde in Barcarena has several free areas which may be bought or leased.
In Vila do Conde, there are at least 3 port operators capable of receiving, handling and loading this
kind of cargo.
The Port Authorities at Vila do Conde (Cia. Docas do Pará – CDP) have also shown interest in allowing
the construction of a warehouse within the port jurisdiction and about 1,000 m from the pier.
Thus, the authors have considered that space/warehouse in Vila do Conde will not be a bottleneck for
the Project.
September 7, 2017
18.11.2 Itaqui
Port Congestion:
Approximately 10-15 days at Itaqui berths 101-104 and about 5 days at Vale-controlled berth 105.
Restrictions:
Unfortunately, the VALE 105 terminal, where Sossego copper concentrates are loaded, and which
could potentially load MCSA copper concentrates, has several restrictions.
The restrictions are the following:
• Vessels have to be min 25,000 mt DWT (this is due to fears that vessels that are too small will
have cranes on deck that may come into collision with the shiploader. For the annual estimated
production of Boa Esperança of 100,000 wmt, we have assumed that the intention is to ship
on monthly basis lots of 10,000 wmt. To ship 10,000 wmt on a vessel of min. 25,000 mt DWT
would make no sense.
• Vessels must have cranes mounted at the center of the ship, not portside. This is also due to
fears that cranes may obstruct the operation of the shiploader. Most of the vessels available
for loading 10,000 wmt on a full cargo basis have cranes mounted on the portside.
We assume that it would not make sense to ship MCSA concentrates in 25,000 wmt lots, due to the
financial and logistics implications of carrying such stock.
Therefore, at Itaqui, we have simulated the operation by unloading the concentrates into trucks upon
arrival by rail, transportation to a purpose-built warehouse close to the Public Port of Itaqui (berths
101-102-103), and loading onto ships via buckets.
September 7, 2017
Figure 18-9: Itaqui berths.
Restrictions:
Berth 105 (Ponta da Madeira)
• LOA: 252 m.
• Beam: Minimum: 20.2 m / Maximum: 34.6 m.
• Draft: 18 m.
• Air Draft (WLTHC): 12.4 m (*) Distance from the water line to the top of hatch coamings.
• Dwt: Min. 25,000 / Max. 63,000.
• Operational area: Max. 137 m (**).
(*) Refer to berthing condition and is based on the highest tide level;
(**) Distance between forward of the first hold and aft of the last hold.
• Vessel with cranes: Distance between cranes or obstacle min. 25 m.
Hatches of min. 15 x 15 m, not applicable if distance between

cranes bigger than 25 m.
• Vessel with derricks: Distance between derricks or obstacle min. 35 m.
Hatches of min. 15 x 15 m.
September 7, 2017
18.11.3 Warehouses in the Possible Transfer Areas

Warehouses
As mentioned before the utilization of warehouses in the ports and possible transfer areas is
mandatory since cargo must to be protected from climate conditions and to comply with environmental
regulations.
The dimension, structure and type of equipment has to be chosen by MSCA considering handling fee,
investments required, maintenance charges, logistics flexibility and/or commercial needs.
Some types of warehouses and equipment will be presented in order to provide MCSA a rough idea.
The most basic warehouse would be represented by 4 walls only, where the tipping truck would
discharge the concentrate directly to the floor and after that a mobile loader would transload the cargo
to the next mean of transport. A more sophisticated warehouse would contain a hopper connected to
a conveyor belt to receive and mount up a pile and a loading system.
It is known that MCSA will need a covered area in the selected port (Vila do Conde or Itaqui). In case
MCSA decides to use more than modal (train or barge), another warehouse in the transferred area
should be used. The area could be located in the following cities: Parauapebas or Sossego in case of
connection with the train and Marabá if second leg is performed by barge.
Parauapebas
A warehouse will be constructed in this location only if MCSA reaches an agreement for the utilization
of the Carajás railroad. In that case, the warehouse should be integrated with the rail system, ideally
similar to the Vale’s warehouse where the wagons are loaded inside the warehouse, reducing the
transport distances.
This warehouse would be prepared to store about 3,500 tonnes which is equivalent to about 2 weeks
of production in an area of 650 m². The piles of cargo can be 3 m high and the warehouse would be
equipped with all the structure and equipment required for this kind of operation (like equipment
prepared to remove the roof of the wagons and machines to transport and load the wagons).
The cargo should arrive to Parauapebas by truck which discharges the cargo on the floor to be loaded
into the wagons by wheel loaders.
The convoy of 28 wagons takes about 9 (nine) hours to be fully loaded because it is necessary 10
voyages (to get the cargo form the pill and load into the train) which demands 2 minutes each voyage.
That means 20 minutes to get one wagon full. The frequency of the trains is weekly.
Itaqui
In Itaqui a small reception area for unloading the rail wagons and re-loading to trucks would be
necessary.
The Warehouse prepared for receiving the cargo from the trains has an area of 525 m2 and is equipped
with a mobile loader to transfer the cargo from this warehouse to the second warehouse located at the
same place. A wheel front-loader is also required to move the cargo inside the warehouse.
September 7, 2017
The second warehouse would have a useful area of 3,000 m2 with capacity to store 12,500 wmt (which
means 1.5 months of production).
Vila do Conde
For this alternative, all the transportation of the cargo to the port should be done by trucks and it is not
necessary to get any agreement with other companies to use their structure.
The required Warehouse in Vila do Conde would have a useful area of 3,000 m2 with capacity to store
12,500 wmt (which means 1.5 months of production). The cargo should be transported from Tucumã
mine to Vila do Conde warehouse by 20 trucks (with capacity of 45 tonnes each) during 26 days’
equivalent to the production of one month.
The warehouse can be either be owned or rented and should be close to the port with direct access
to the pier in order to avoid operations delays.
18.12 Investment & Transport Costs

Further to the analyzed conditions between the Boa Esperança site and the mentioned loading ports,
it was estimated 2 types of cost to develop this copper concentrates project.
The first cost is for the investment in the infrastructure needed to perform such operation - CAPEX and
the second cost is the OPEX - operational cost to transport, handle and have a continuous flow of
product.
Handling equipment can be either purchased by MCSA or alternatively inserted in the scope of
services of a contracted warehouse plus stevedoring operator.
September 7, 2017
18.12.1 Preferred Logistics Alternative

Flowchart
Figure 18-10: Flowchart of the Preferred Logistics Alternative.
September 7, 2017
Capex
Table 18.6: Capex of the Preferred Logistics Alternative
ESTIMATED
ITEM COST (R$)
ROAD INVESTMENT
15.5 KM BOA ESPERANÇA 6,014,177
WAREHOUSES
3000 M2 WAREHOUSE IN VILA DO CONDE 0
TOTAL CAPEX 6,014,177

Opex
Table 18.7: Opex of the Preferred Logistics Alternative
Cost Per Logistic Unit Operation
ITEM ESTIMATED
COST (R$ / MT)
TRUCK BOA ESPERANÇA / VILA DO CONDE 175.01
TRUCK PARAUAPEBAS / VILA DO CONDE 144.99
BULK
LOADING MONDAY FRIDAY 45.01
LOADING SATURDAY 55.31
LOADING SUNDAY / HOLIDAYS 68.39
GRABS 3.50
STORAGE CHARGES VILA DO CONDE (1ST PERIOD OF 30

DAYS) 8.00
STORAGE CHARGES VILA DO CONDE (2ND PERIOD OF 30
DAYS) 5.99
PORT TAXES (TABELA I + TABELA III + TABELA VI) 5.51
BULK - EXW BOA ESPERANÇA / FOB (*): 242.58
CONTAINER
STUFFING / HAULAGE ANANINDEUA / BELEM 66.15
STUFFING / HAULAGE ANANINDEUA / VDC 91.35
September 7, 2017
SL CHARGES (THC/SEAL) 33.08
CONTAINER - EXW BOA ESPERANÇA / FOB BELEM: 274.21

CONTAINER - EXW BOA ESPERANÇA / FOB VDC: 299.41
Origin: Boa Esperança

(*) Weighted arithmetic mean for loading operations costs + 1 period of storage
18.13 Ocean Freight

18.13.1 Bulk
Europe
• Copper Concs in bulk: 5,435, 10,870 & 16,305 wmt (pls quote 3 sizes)
• POL (loading rate): Vila do Conde (5,000 wmt pwwd shinc)
• POD (disch rate): Huelva (5,000 wmt pwwd satpmshex)
• Brunsbuttel (5,000 wmt pwwd sshex)
• Burgas (3,000 wmt pwwd sshex)
• TOS: Starting end 2014
• Freight basis foist 1/1
Table 18.8: Europe freight basis.
Vila do Conde
Destination 5,435 wmt 10,870 wmt 16,305 wmt
Huelva R$ 189.00 pmt R$ 110.25 pmt R$ 102.38 pmt
Brunsbuffel R$ 220.50 pmt R$ 126.00 pmt R$ 110.25 pmt
Bourgas R$ 252.00 pmt R$ 157.50 pmt R$ 157.50 pmt
Asia
• Copper concs in bulk: 16,305 & 21,740 wmt

• POL (loading rate): Vila do Conde (5,000 wmt pwwd shinc)
• POD (Disch rate): Nanjin, Qingdao, Fangcheng, Lianyungang (3,000 wmt pwwd satpmshex)
• TOS: Starting end 2014
• Freight basis foist 1/1
Table 18.9: Asia freight basis.
Vila do Conde
Destination 16,305 wmt 21,740 wmt
Korea port R$ 236.25 pmt R$ 195.30 pmt
China port R$ 236.25 pmt R$ 195.30 pmt
September 7, 2017
18.13.2 Container
Belém and Vila do Conde are 2 viable options to load the copper concentrate in container. Both ports
are attended by container ship owners. While Belém has only 2 available ship owner options, Vila do
Conde counts with at least 5 different options. From this point of view, Vila do Conde appears as the
best loading option. However, the inland transport costs to reach Belém in container are lower than
Vila do Conde’s. And Belém’s metropolitan area has more stuffing container options.
Main Destinations
Table 18.10: Main destinations and costs.

VILA DO
DESTINATION BELEM CONDE
Lianyungang R$ 4,567.50 R$ 4,567.50
Qingdao R$ 3,307.50 R$ 3,307.50
Taichung R$ 3,622.50 R$ 3,622.50
Shanghai R$ 3,307.50 R$ 3,307.50
Nantong R$ 3,307.50 R$ 3,307.50
Busan R$ 2,992.50 R$ 2,992.50
Incheon R$ 4,725.00 R$ 4,725.00
Tuticorin R$ 6,142.50 R$ 6,142.50
Antwerp R$ 3,622.50 R$ 3,937.50
Cadiz R$ 4,252.50 R$ 4,410.00
Hamburg R$ 3,622.50 R$ 3,937.50
- Freight per 20ft ST cntrs
- About 25 mt per cntr
18.14 Capex & Opex Comparison

18.14.1 Capex
Table 18.11: Capex of road investment.
ROAD INVESTMENT R$
15.5 KM BOA ESPERANÇA 6,014,177
18.14.2 Opex
BULK
Total from EXW Boa Esperança to CFR / ton:
Table 18.12: Bulk opex comparison.
Destination 5,435 wmt 10,870 wmt 16,305 wmt 21,740 wmt
September 7, 2017
Huelva R$ 431.58 R$ 352.83 R$ 344.96 -

Brunsbuffel R$ 463.08 R$ 368.58 R$ 352.83 -
Bourgas R$ 494.58 R$ 400.08 R$ 400.08 -
Korea port - - R$ 478.83 R$ 437.88
China port - - R$ 478.83 R$ 437.88
CONTAINER
Total from EXW Boa Esperança to CFR / ton:
Table 18.13: Container opex comparison.

VILA DO
DESTINATION BELEM CONDE
Lianyungang R$ 456.91 R$ 482.11
Qingdao R$ 406.51 R$ 431.71
Taichung R$ 419.11 R$ 444.31
Shanghai R$ 406.51 R$ 431.71
Nantong R$ 406.51 R$ 431.71
Busan R$ 393.91 R$ 419.11
Incheon R$ 463.21 R$ 488.41
Tuticorin R$ 519.91 R$ 545.11
Antwerp R$ 419.11 R$ 456.91
Cadiz R$ 444.31 R$ 475.81
Hamburg R$ 419.11 R$ 456.91
18.15 Conclusion
Currently the only present export option is represented by the port of Vila do Conde, which should be
accessed by truck. The situation may change in the future in the event the Tocantins River and/or
Carajás Railroad infrastructure evolves.
The situation in Vila do Conde is more favorable than previously envisioned, as there are now new
companies with own capacity to receive, handle, store and load the cargo. The presence of third-party
contractors means that MSCA does not need to invest in own warehouses and machinery if an
agreement is made with any of these companies. It is assumed that such an agreement can be made
on commercially acceptable terms, and consequently, the capital cost of the project was substantially
reduced relative to prior options.
Additionally, the following was considered:
September 7, 2017
• Port congestion at Itaqui is historically higher thereby increasing the vessel demurrage bill
(one day of demurrage costs US$ 8,000-12,000 depending on the type of vessel used).
• The “cost” of dealing with VALE as a service provider and at the same time a competitor in
the Copper segment. We cannot give this a numeric value, but from a strategic point of view
would recommend MCSA’s independence from the VALE system as a natural policy.
• The multimodal option will most likely generate higher cargo losses than the truck only option
due to extra handling.
September 7, 2017
19 Market Studies and Contracts
19.1 Market Studies

As numerous market studies show, copper has recently entered a period of tightening supply and
demand, which is expected to continue upward pressure on the copper price over the medium- and
long-term. A comprehensive review of third-party market research is outside the scope of this
Technical Report; however, a brief synopsis of the major market factors has been provided below.
The copper price in the five years leading up to 2016 continued a mostly downward trend. In response,
many copper producers focused on optimization of existing operations, curtailing investment in
expansions and development projects. This, in turn, led to a slowdown in supply growth which, when
combined with even moderate growth rates in demand, has served to steer the market into a looming
copper deficit. The supply-demand imbalance is likely to be exacerbated by the long lead times
required to permit and construct new copper mines.
The lack of new copper mines approved and commencing construction currently and in the coming
years means that a rapid supply response in the face of increasing demand, albeit at even moderate
rates, is unlikely. In addition, in their report titled “Global Copper long-term outlook Q1 2017”, Wood
Mackenzie identifies risks to existing sources of mine supply grade decines, supplydisruptions at
existing operations, technical challenges at projects in development, and historically low exploration
budgets as contributing to the slow and declining supply response. Over the medium to long-term,
currently anticipated new copper mine supply will be barely sufficient to replace maturing operations.
Furthermore, new mine supply is not guaranteed as most projects remain subject to permitting,
engineering or require higher metal prices to justify development economics.
Wood Mackenzie anticipates copper demand growth to continue at a rate of 1.2% to 1.8% per annum
over the next decade, primarily driven by continued growth from China and other emerging markets in
Asia.
An estimate of the achievable revenue per tonne of concentrate produced by Boa Esperança can be
calculated based on the following factors:
• The forecast price of copper;

• Plus/minus any credits (gold and silver) and penalties (impurities); and
• A charge for the TC/RC applied to the processing of copper concentrate to copper cathode.
Ero has assumed that the Boa Esperança concentrate will incur similar TC/RCs to that of its Curaçá
Valley operations with forecast TCs of US$78.50 per tonne of concentrate and RCs of US$0.0785
(7.85 cents) per pound of copper. Presented prices are nominal.
SRK has reviewed the market studies and confirms that the results support the assumptions in the
Technical Report.
September 7, 2017
19.2 Contracts
The Boa Esperança Project is in the development phase. There are no contracts currently in place.
September 7, 2017
20 Environmental Studies, Permitting and Social or

Community Impact
20.1 Historical Context of Tucumã
The Boa Esperança Project is located in an area that was originally occupied by the Andrade Gutierrez
colonization project (CONSAG), winner of the competitive tendering process run by the National
Institute of Agrarian Reform in 1978, which had the aim of encouraging the colonization of the Tucumã
Project over an area of 400,000 hectares of Union-owned property. During this period, one of the major
objectives of the federal government "was to promote the occupation of demographic gaps."
The Tucumã Project was divided into three tracts of land in order to allow work to commence. Tract I,
the first to be colonized, covered an area of 181,000 hectares and contained more than 540 km of
completed roads. In 1983, the level of investment in the Tucumã Project by Andrade Gutierrez began
to decline, contributing to the non-development of Tracts II and III.
In 1985, the Project area was illegally occupied, resulting in a population boom which in turn led to a
disorderly occupation of the Tucumã Project grounds, thus preventing this area from functioning as a
private colonization enterprise. At this point, negotiations that led to the reversal of the Tucumã
Colonization Project and its hoped-for improvements to the Union began on October 30, 1988.
With the end of the company's Tucumã Project and a lack of participation from the local government
in São Félix do Xingu, local community representatives decided to create the Community Development
Council of Tucumã (CODETUC), which aimed to establish urban occupation, conduct urban planning
and preserve common environmental areas, essential public services and goods held by the Union
and used by the municipal government. This resulted in the expansion of activities related to timber
and the exploration of gold reserves and allowed other activities essential to the development of
Tucuman to progress. The city of Tucumã was created by Law # 5,455, on May 10, 1988.
The 1990s were difficult years for the city. New settlers were struggling to adapt, there was a lack of
transportation and paved roads and diseases common to the region were causing problems. The
2000s saw a major structural change in the production chain in the region. It became a major producer
of rice, cocoa, coffee, beans, corn and milk. Plans were made for the PA279 (the main road link
connecting São Félix do Xingu with the rest of Brazil) to be paved.
Industrial production in Tucumã during the 1980s and 1990s was centered on logging. This activity
caused major ecological damage to the area, with devastating consequences for the indigenous
population and areas earmarked for environmental preservation.
Wildcat mining (also referred to as garimpero) was a substantial source of income for the city in the
first few years after its emancipation. However, the rapid exploitation of Mineral Resources led to the
exhaustion of local mines and by the late 1990s mining activities in the rural villages of the municipality
had ceased. The high point of the mining activity in the municipal area centered on the agricultural
community of Cuca, about 36 km from the city of Tucumã.
In 2008 the implementation of a mineral project (the Boa Esperança Project) was proposed, through
public consultations, for the mining and processing of copper in the city of Tucumã.
September 7, 2017
20.2 Environmental Laws and Licensing

As at the time of the Effecitve Date, as required by the Brazilian National Environmental Policy
established on August 31, 1981 (Federal Law ref. No. 6,938), all activities that cause pollution or have
the potential to pollute are subject to environmental licensing. Applicable rules regarding licensing
procedures were established by the National Council for the Environment (“CONAMA”) under
Resolution 237 of December 19, 1997.
It is by means of this licensing procedure that the issuing agency determines the conditions, limits and
measures for the control and use of natural resources and allows the installation and implementation
of a mining project. Depending on the nature of the operation, licenses are required to be issued by
federal, state or municipal agencies.
• Federal entities are responsible for licensing activities that may cause national or regional
environmental impacts (where more than one federal state is affected).
• State entities, including the federal districts, are responsible for the environmental licensing of
potentially polluting activities not compatible with the criteria defined in licensing laws by the
municipalities.
• Municipal entities are responsible for licensing activities that may cause local environmental
impacts, as defined by the state environmental agency.
Other criteria are also considered, such as the administrative responsibility for the management of
protected areas including, sustainable forests, water resources, conservation and other protected
areas, among others.
20.2.1 Reclamation of Degraded Areas

As of the Effecitve Date, Article 225 of the federal constitution (1998) states that “Those who exploit
Mineral Resources shall be required to restore the degraded environment, in accordance with the
technical solutions demanded by the competent public agency, as provided by law”. This recovery, as
expressed in IBAMA's Recovery of Areas Degraded by Mining guide "means that the degraded site is
returned to a form of use in accordance with the predetermined plan for use of the soil. It implies that
a stable condition is obtained in accordance with the environmental, aesthetic and social criteria for
the surrounding country. It also means that the degraded site will have the minimal conditions required
to establish a new dynamic equilibrium, including the development of new soil and a new landscape".
The reclamation project must include (in chronological order) the objectives to be achieved in the short,
medium and long term. Short-term goals involve topographic restoration of the land, erosion control,
replanting of vegetation and waste control, among others. In the medium term it seeks to restructure
the physical and chemical properties of the soil, recycle nutrients and encourage the reappearance of
fauna. And finally, in the long-term, the self-sustaining recovery process must be aided, along with the
soil-plant-animal inter-relationship and the future use of the area.
20.2.2 International Finance Corporation Performance Standards

The International Finance Corporation’s (IFC) Sustainability Framework articulates its strategic
commitment to sustainable development and is an integral part of its approach to risk management.
September 7, 2017
The Sustainability Framework comprises of the IFC’s Policy and Performance Standards on
Environmental and Social Sustainability and the IFC’s Access to Information Policy. The Performance
Standards are directed towards clients and provide guidance on how to identify risks and impacts.
They are designed to help prevent, mitigate, and manage risks and impacts to allow business to be
conducted in a sustainable manner, including stakeholder engagement and the client's disclosure
obligations in relation to project-level activities. The IFC requires its clients to apply its performance
standards when managing environmental and social risks and impacts so that development
opportunities are enhanced. The Performance Standards may also be applied voluntarily by other
financial institutions or mine operators. MCSA voluntarily decided to use the IFC Performance
Standards during project development.
20.3 Licensing Requirements

20.3.1 Mining Rights Status
MCSA acquired the Boa Esperança copper deposit concession from Corporación Nacional del Cobre
(Codelco) in 2007 and became the legal owner of the mineral rights to the Boa Esperança copper
deposit. In December 2016, Ero Copper Corp. acquired approximately 85.0% interest in MCSA. In
June 2017, Ero acquired an additional 14.5% by subscribing for shares from treasury for a total interest
in MCSA of approximately 99.5%.
5, 2010; and
All criteria to obtain the mining rights have been fulfilled and the Company is awaiting final approval of
the change status to a full Mining Concession after issuance of the Installation License, currently under
review by the Pará State environmental agency.
20.3.2 Environmental Licenses

The Pará State Environmental Agency granted a Preliminary License to MCSA on March 7, 2012
which was subsequently renewed on June 19, 2013. MCSA filed for an Installation License request on
April 1, 2013 which is currently under analysis.
A grant for well drilling and evaluation of water potential (considering future groundwater collection for
the installation phase) was issued. The formal request for water use will be submitted immediately
after the issuance of the Installation License (IL).
The IL is prepared when the project design has advanced far enough for engineering plans to be
submitted to the government for approval. The IL is accompanied by an Environmental Control Plan
referred to as a PCA (Plano de Controle Ambiental) and a Degraded Area Recovery Plan or PRAD
(Plano de Recuperação de Áreas Degradadas). Once the IL has been granted, the DNPM can issue
a Mining Concession. It is at this licensing stage that the Legal Reserve is defined. The Legal Reserve
September 7, 2017
is an area whose size depends on state rules requiring the preservation of a portion of the natural
biota. It is legalized by the Rural Environmental Register (Cadastro Ambiental Rural – CAR) or at the
Real Estate Notary Office as property of the enterprising party, in accordance with Federal Law #
12.651/2012. In Pará the law has established that 80% of the propriety area should remain as a Legal
Reserve. This percentage may be changed depending on the specific conditions of Environmental –
Economical Zone in each region. At the time of the Effecitve Date, this was regulated by the Brazilian
Forest Code, Law # 12.651/2012 and Pará State Decree # 2.099/2010.
The area earmarked for deforestation covers 38.65 ha at this stage of the project. The Legal Reserve
is being discussed with the Environmental Agency (SEMA) and will be a condition of the IL. The
environmental agency is analyzing the IL process for the granting of this license.
The Operating License (OL) allows the project to begin operations and is issued after all of the
appropriate environmental measures have been implemented and verified by the authorities. The OL
must be renewed during the life of the mine. When the OL is up for renewal, a report summarizing
environmental performance must be presented.
If, during the operation, there are substantial changes to the initial project plan (e.g. an additional
treatment plant), this will require another specific IL, which will subsequently become an OL.
20.4 Physiography, Flora and Fauna

20.4.1 Soil and Sediments
There are two main soil types present in the project area, covering an extensive area of over 70km in
length to the northeast: red-yellow clay soil (PVA) containing PVA dystrophic, PVA eutrophic and
litholic dystrophic neosoil (RLd); and eutrophic red clay soil (NVe), red eutrophic clay soil (PVe) and
red dystrophic clay soil (PVd). These soil types feature low fertility levels. During the dry season,
controlling dust levels can be an issue due to the fine grain nature of the soil. The landscape is slightly
hilly and the Boa Esperança mineral deposit is situated at the highest topographical point.
Clay soils contain mineral material, are found at relatively deep levels and are normally well drained.
They have differentiating characteristics, including the presence of a textural horizon B, whose clay
has either a low or high activity, coupled with low base saturation or non-lytic characteristics. They
exhibit a textural B horizon immediately below any surface horizon.
They range in depth from strong to poor drainage and are reddish or yellowish in color. The texture
varies from sandy-loamy to clay on horizon A and medium to very clayey on horizon B. There is always
an increase of clay in the second horizon.
The soil at the site presents dystrophic and eutrophic features (predominantly the former), in which the
percentage of base saturation is less than 50%, and therefore quite acidic. They are average to low
fertility soils and have a low nutritional potential (lower than the topsoil), though the aluminum
saturation is less than 50%.
The clay consists of mineral material with a nitic horizon B, with a clayey and clay content above
350g/kg of soil from horizon A. The structure of angular blocks ranges from moderate to strong waxy
on the surfaces of the aggregates present in the B horizon and is expressed in terms of the degree of
development and waxiness, with a texture gradient less than 1.5. They have the characteristic
appearance of cracks, indicating high expansion and contraction, which is due to wetting and drying
cycles of soil with such a high clay content. Generally, it appears moderately acidic to acidic, with low
September 7, 2017
activity clay or a non-lytic character and a predominantly kaolinite-oxide composition. It may present
horizon A of any kind.
Chemical concentrations of compounds that have the characteristics of and significance as

environmental pollutants were discovered. Some of chemical elements are lithophile according to the
Goldschmidt Classification, exhibiting the characteristics of mineral forming rocks. They are prevalent
in the environment and have little or no toxicity. Others are heavy metals or semi-metals that have
greater environmental relevance, especially to the biota. Heavy metals such as cobalt, chromium,
copper and lead contain medium and maximum values higher than the world median. Other elements
such as manganese, lithium and vanadium have values below the world average. Nickel and zinc have
average values within the global order.
The study area is anomalous with respect to the concentration of certain chemicals, as would be
expected in a mineral deposit (Figure 20-1). The data collected will serve as a comparison for future
analytical data.
September 7, 2017
Figure 20-1: Soil sampling points at the Boa Esperança Project area (Source: KEYSTONE,
2008)
September 7, 2017
20.4.2 Local Hydrography

The Boa Esperança ridge is located in the Rio Fresco Basin, between tributaries of the Carapanãzinho
and Rio Branco creeks within the Xingu hydrographical region. Drainage in the immediate area is lotic
(flowing), with a prevalence of small creeks (Figure 20-2). Drainage patterns in the area are not well
defined, given that channels are flooded during periods of heavy rainfall.
Figure 20-2: Local and regional drainage network (Source: MDGEO, 2011)
The Fresco River is incredibly important to the region. It is one of the major tributaries of the Xingu
River and it drains the boundary between the states of Pará and Mato Grosso until it reaches the São
Felix do Xingu River. The Fresco River flows northwards and rises on the border of Serra do Matão,
located to the south of Serra dos Gradaús, in the municipality of Cumaru do Norte. It extends for about
130km.
The Tocantins, Araguaia and Xingu rivers create an important and strategic hydrographic network for
the transportation of products to the municipalities in the southeast of Pará. Products can be
transported straight to the metropolitan region of Belém and other industrialized municipalities, as well
as to external markets.
September 7, 2017
Throughout the Xingu and Araguaia-Ticantins rivers basins (which cover an area of approximately
1,250,000km2 according to HIDROWEB-ANA, 2003), many economic activities are ongoing. The main
activities include agriculture and livestock (of various sizes), the base mineral industry, materials for
construction (roofing tiles, bricks, sand, pebbles, etc.), fishing (mainly artisanal) and navigation for the
transport of passengers and the marketing of regional products.
The municipality of Marabá, in which the enterprise is located, serves as a venue for national and
international exportation for many companies, primarily those involved in mineral sector. It defines the
economic profile of the waterway network. It is important to highlight the importance of this waterway
network to the agribusiness sector that has developed in the region of Xinguara, Marabá, Parauapebas
and Rio Maria. Agribusiness has used the waterway network to expand significantly.
The State of Pará contains the following hydrographic regions: Calha Norte, Tapajós, Baixo
Amazonas, Xingu, Portel-Marajó, Tocantins Araguaia, Costa Atlântica Nordeste. Some of them are
divided into sub-regions (Table 20.1). The enterprise is located within the Xingu hydrographic region.
Table 20.1: Hydrographic regions and sub-regions of the state of Pará (Source: SSMA, 2010).
Hydrographic % of Para State Number

Sub-region Area (km²)
Region area of basins
Paru, Jari, Cuminapanema,

Calha Norte 276,327.05 22.07 14
Maicuru, Nhamundá, Trombetas
Tapajós 217,732.54 17.39 7
Baixo
59,471.02 4.77 4
Amazonas
Xingu 313,233.00 25.01 8
Portel-Marajó Portel, Marajó 123,209.90 9.84 9
Tocantins
Tocantins, Araguaia 139,942.46 11.17 7
Araguaia
Costa
Atlântica Atlântico, Gurupi, Moju-Capim 122,050.94 9.75 6
Nordeste
20.4.3 Water Availability

Water points are defined as any access to groundwater from which information on the groundwater
can be gleaned. The main water points are: wells; dug wells; springs (surges), wetlands, rivers and
ponds connected to the aquifer. 51 springs, 10 control points, 24 dug wells and 2 tubular wells have
been counted within the boundaries of the project area. The springs and control points are located in
the Hydrographic Sub-basin of Capanãzinho creek and the Branco River.
With regard to the water supply for the Boa Esperança Project, the initial plan was to divert water from
Carapanãzinho creek. However, studies have shown that the use of Carapanãzinho creek, as well as
September 7, 2017
other streams within the area surrounding the project, is not viable due to their intermittent depth and
flow.
The production capacity of underground water ponds has been deemed too low for tubular wells (about
6m³/h). However, this option could potentially be used in the early stages of the Boa Esperança Project
installation, when the demand for water will be low.
Initially, studies have been conducted regarding the water use of the Rio Branco river, to the demand
of the enterprise. Later, this alternative was discarded due to interference in indigenous areas.
Conceptual studies consider water use in the stream Jatobá, near the project area.
Figure 20-3: Map showing the locations of inventoried collection points (Source: MDGEO,
2011)
20.4.4 Aquifer Systems and Hydrogeological Aspects

The regional geology of Sao Felix do Xingu can be divided into three major tectonic compartments,
namely the Land Granite-Greenstone of Southern Pará, the Shear Belt of Itacaiúnas and the Middle
Xingu Basin. The Land Granite-Greenstone section of Southern Pará is formed by a northwest-
southeast Archean belt composed of granitoids and supracrustal rocks. The supracrustal rocks such
September 7, 2017
as metabasics and metasediments are called the ‘Tucumã Group’ and the granitoids the ‘Granodiorite
Rio Maria’.
The Shear Belt of Itacaiúnas covers most of the São Felix do Xingu Region. It consists of Upper
Archean rocks, which are intensively formed and deformed by lenticules. The basal stratigraphic unit
is called the ‘Xingu complex’ and it is composed of gneisses and granulites. The system includes rocks
of the Aquiri Group and São Sebastião.
In the development of the Middle Xingu Basin an extravasation of a volcanic sequence has occurred.
This is evident in the Uatumã Group. The Uatumã Group consists of andesites, dacites and rhyolites.
The area around the municipality of Tucumã has a complex geological structure, which comprises
crystalline and metasedimentary rocks from the Pre Cambrian era. Groundwater can be classified in
two geological categories as follows: (i) sedimentary, (ii) metamorphic / igneous. The sedimentary
areas are characterized by aquifers with intergranular porosity and tertiary-quaternary alluvial cover.
The metamorphic and igneous zones are characterized by a Proterozoic basement and fractured
aquifers. Porosity and permeability are a consequence of the combination of structure and the process
of weathering. Water storage and circulation are related to the occurrence of open fractures associated
with the weathered layer in these areas and recharge zones.
Fractured aquifers are related to a crystalline basement, mainly granite, quartzite and supracrustal
rocks, with an unknown contribution from the weathering cover. These rocks represent approximately
75% of the total area. Granular aquifers are represented by detritic-lateritic and alluvial sedimentary
cover, amounting to 25% of the area
The existing hydrogeological system in the region has the typical characteristics of aquifer formations
located in the crystalline basement. It is an aquifer consisting of a shallow weathering mantle whose
thickness can be measured in meters (porous aquifer), superimposed on the crystalline basement
(fractured aquifer), variably deformed and fractured.
Available data indicates that the porous aquifer displays transmissivity of about 30m2/day, hydraulic
conductivity (K) of 0.3m/day and storage of around 1 x 10-4. The transmissivity of the fractured aquifer
was approximately 1.0m2/day and the hydraulic conductivity resulted in a figure of 0.01m/day. These
values are compatible with fractured aquifers and indicate that this aquifer has a low hydrogeological
potential.
In general, this aquifer system presents a water quality suitable for human consumption. In some
cases, potability varies depending on the iron content of the water. Due the low discharge levels
observed in pumping tests, the potential for water exploitation is low. However, this could be facilitated
using tubular wells with a depth of 150 meters. This aquifer system is of relatively high importance due
to its use by local communities, even with reasonable water potential, low availability and high level of
difficulty in terms of its exploitation.
20.4.5 Flora and Fauna

The Project is located in a heavily populated area within the Amazon region where human
development has resulted in extensive fragmentation of the native forest ecosystems (Figure
20-4;Figure 20-5). Losses of biodiversity, including the extirpation and extinction of several local
September 7, 2017
species in the region, tend to be blamed on anthropogenic activities and impacts, particularly
widespread grazing by livestock, as well as smaller agricultural development activities
Figure 20-4: Deforested area – 2000 (Source: Keystone, 2008)
September 7, 2017
Figure 20-5: Deforested area – 2008 (Source: Keystone, 2008)
Overall, the typical vegetation in the Boa Esperança Project area is of the Humid Tropical Forest type,
also called the Equatorial Forest Broadleaf. This type of vegetation can only be found in the Boa
Esperança ridge area (Figure 20-6).
Large areas of pasture can be seen in the low-lying areasdue to the expansion of agriculture and
logging. In addition to these dominant features, the region has gallery forests along the waterways
and, in areas subject to flooding such as swampland, lowland forests can be found.
Figure 20-6: Humid Tropical Forest, seen at the peak and on the slopes of Boa Esperança
Mountain (Source: MDGEO, 2011).
20.5 Environmental Studies

20.5.1 Classification of Areas of Influence
The baseline characterization studies and environmental impact assessment (EIA) for the Boa
Esperança Project were prepared by Keystone Ltd/Geomma and submitted to SEMA in 2008. This
document contains information about potential impacts (or influences) on the physical, biological and
social environment because of mining activities.
The EIA classifies areas of influence into three categories:
• Área Diretamente Afetada (ADA) = Directly Affected Area;

• Área de Influência Direta (AID) = Directly Influenced Area; and
• Área de Influência Indireta (AII) = Indirectly Influenced Area.
September 7, 2017
The Boa Esperança Project EIA attempted to calculate the potential effects of the proposed mine on
the physical environment and/or local communities in comparison with the current baseline conditions.
It includes an evaluation of both the positive and negative impacts, using a scale of high, moderate,
low or insignificant levels. Depending on the probable identified adverse impact, mitigating measures
were identified to reduce potential impacts to an acceptable level.
Changes to the boundary of the project area were necessary due to a demand made by the Pará State
Environmental Agency during the review of the LP application. The ADA now includes village P07 and
drainage of about 200m, which were previously not included. This update added approximately 1,202.1
ha to the ADA. Additionally, the AID now includes springs which flow to the Branco River and Jatobá
Creek. The main drainage affected by the project totals 7,204.4 ha. They increased by 1,607.7 ha, due
to the addition of two drainages areas.
The Environmental Control Plan (PCA) was submitted to the environmental agency in April 2013,
Figure 20-7 show the delimitation of the areas of influence required by SEMA.
Figure 20-7: Environmental delimitation - Physical / Biological
20.5.2 Protected Areas

The areas protected by Brazilian law include Permanent Preservation Areas, Legal Reserves, Nature
Conservation Units and Indigenous Lands, amongst others (such as those relating to a specific biome).
The Constitution does not preclude exploration or mineral mining on indigenous land provided that:
there is authorization from Congress through a Legislative Decree and the participation of indigenous
peoples has been ensured. Assurances must also be given that they will benefit from the results of
September 7, 2017
mining activities and any concerns voiced by indigenous peoples affected by mining activities will be
heard.
The project area is near the Kayapó Indigenous Area of the Fresco and Xingu Rivers, at distances
greater than 10 km to the south.
In the Search Application phase, the license granted by the DNPM covered a polygon covering
9,226.07 hectares. With the approval of the Final Exploration Report, the area was reduced to 4,033.81
ha. This is because, initially, the project would have partially interfered with conditions in protected
areas, which required a study of the indigenous component in the environmental assessments.
According to Ministerial Decree # 419/2011, a specific evaluation of socio-environmental damage is

necessary when there is activity at a distance of less than 10km from indigenous lands in the Amazon.
20.5.3 Legal Reserve

The Legal Reserve area must be registered with the SEMA through the Rural Environmental Registry
(CAR). The CAR is a national electronic public record through which a database for the control and
monitoring of environmental and economic planning has been created. It is also aimed at combating
deforestation. Registration with CAR is compulsory for all rural properties and possessions and can
be described as declaratory and permanent in nature.
Registration with CAR states and declares the geographical delimitation of the exact location to ensure
environmental protection, as defined in the Brazilian Forest Code, as of the Effective Date.
In October, 2014 the Boa Esperança Project received notice to present the relative CAR
documentation to SEMA. The Project implementation area is characterized by a low volume of
environmental sections, which implies that there was difficulty in defining an area that meets the
requirements, such as the proximity of vegetation to other Legal Reserves, Permanent Preservation
Areas or Protected Areas.
The location of the area intended as a Legal Reserve must be approved by the Environmental Agency,
as it is a condition of the Installation License.
20.5.4 Agrarian Reform Areas

The Project area intersects the municipalities of Ourilândia do Norte and Tucumã; whose origins lie in
a settlement program by the Brazilian government created through the National Institute for Agrarian
Reform (INCRA) during the 1970s. From 1985 onwards, there was a significant population increase
due to an increase in gold prospecting in the area.
An increase in population and agricultural activities (namely livestock grazing), specifically beginning
with Vale’s Onça Puma Project in 2005, coincided with measured environmental effects and
degradation..
Project operations will span nine rural properties, causing the economic and physical displacement of
many local inhabitants. To address the issue of economic displacement (e.g., the loss of pastures that
affect one’s livelihood), MCSA has planned compensation through land exchanges (purchases and
swaps), as well as financial support.
September 7, 2017
MCSA does not possess a property title for the areas occupied by the Boa Esperança Project, but will
obtain a grant of use from the INCRA, for approximately 1500 ha, with compensation given to resettled
families.
The individual negotiation process for improvements has been completed and MCSA has acquired the
first area for settlements (Fazenda Padre Luso) and is in the process of procuring land at Santa Ana.
The area destined for the resettlement of families is located near the city limits, with increased access
to infrastructure such as healthcare services, education and accessibility.
A Committee was set up to work alongside the Pastoral Land Commission (CPT) and is responsible
for the relationship, legal and technical support required throughout the process.
20.5.5 Conceptual design of the Dam

In 2015 VOGBR Water Resources and Geotechnical presented a conceptual design for the water
pond to ensure a clean water supply, which should meet the required demand of the copper ore
processing plant at the Boa Esperança Mine.
This study considered the development of the project, including the following basic units: the open pit,
waste dump areas and tailings dams, mineral processing facilities and administrative units.
The water pond will have the purpose of storing clean water to meet the demand of the plant, estimated
at a flow of 150m³/hour, working for a year without interruption. The water pond will be located in the
Jatobá stream, within the area owned by MCSA.
The water pond should be placed in an area close to the future industrial plant and consist of two
dykes separated by a central hillock.
The bodies of the dykes will consist of a homogeneous section of compacted soil. The geometric
features are defined as follows: 240 meters high at dam crest and 10 meters wide with an upstream
and downstream slope of 1V:2.0H.
The area to be cleared for the creation of the water pond covers an area of 251,801.38 m² and the
excavation for the foundation of the body of the dam will be approximately 1.5 meters deep.
The construction of the water pond is expected to use saprolite from the excavation of the existing hill
on the site where the pit is to be formed (pickling of pit).
The VOGBR study describes the need for geological/geotechnical investigation and laboratory testing
to assess the geotechnical parameters. Also, the preparation of a water balance study for the water
pond is necessary in order to evaluate the water level behavior and the operating system, and to
determine the filling period. These investigations have already been completed and the results made
available for further study
20.6 Environmental Impacts and Mitigation

The environmental impacts have been assessed in the EIA, considering mitigation measures to control
plans specified in the Environmental Control Plan – PCA. A summary of the environmental impacts
and mitigation measures is presented in Table 20.2
September 7, 2017
Table 20.2: Summary of the environmental impacts and mitigation measures

Assessment of Impacts Mitigation and Management
There is no specific measure related to climate, but the
The project is expected to have minimal effect on overall regional
Climate management measures of the physical environment contribute to
climate, but may localized effects on area humidity
minimize this impact.
A monitoring and control program for air quality will be
Mining operations will release various gases and generate fugitive dust developed, evaluating total particles in suspension, smoke, sulfur
Air quality
emissions dioxide, inhalable particles, carbon monoxide, ozone and nitrogen
dioxide as required by Brazilian laws.
Combustion emissions analyzedincluded the release of gas and vapors
Combustion A specific program is not available concerning Greenhouse Gas
from motor vehicles. According the analyses presented in the EIA, the
emissions (GHG) emissions.
west wall of the pit will act against this atmospheric dispersion.
The amount of airborne particulates increases as a consequence of
excavations, transport, and ore
Fugitive dust Road watering and sprinklers in the crushing area to keep airborne
processing during normal mine operations. Fine particulates can affect
emissions dustlevels at a minimum.
vegetation inside the AID.
Physical
Odors
The EIA does not mention anything with respect to odor emissions.
emissions
Ambient noise levels will increase with commencement of mining and Isolation of sources, and the use of adequate equipment (EPI’s). A
Noise processing in association with the use of haul trucks and light vehicles, monitoring and control program for noise will be developed as
plant operations, power generation and construction activities required by Brazilian laws.
The EIA describes a conceptual program for waste management.

The Waste Management Plan will detail the handling, storage, and
Wastes generated by Project activities, including mining and processing
Waste disposal of wastes generated by Project activities, including mining
wastes, hazardous and sanitary waste.
and processing wastes, as well as the management of wastes
requiring special handling (hazardous and sanitary waste)
Mitigation measures include the use of the trees around the

Project area, to coincide with local topography. Stormwater
Topography The natural topography will be permanently altered by the planned mine- diversion channels and sedimentation basins will be utilized to
and Landform related construction and operational activities. control surface run-off from the property. Regular monitoring of
the surrounding natural drainages will be implemented to ensure
that the site sediment control features are functioning properly.
September 7, 2017
Land use in the region of the Project is associated with livestock

rearing; therefore, ranches and pastures continue to be a predominant
Visual Mitigation measures include the use of the trees around the
feature of the landscape. The Project installation will contribute to
resources visual segmentation, with a defined set of access roads, and the
Project area.
inclusion of the enterprise in the intervention area.
Geology Acid rock drainage (ARD) potential The potential for acid drainage was focus of study in 2015
Mitigation measures include concurrent reclamation efforts
Potential impacts to soil resources include effects to physical (i.e.,
during operations to minimize erosion, the use of a clay liner
disturbance, removal, mixing, etc.), chemical, as well as biological
beneath the waste rock dump, and revegetation after mining is
characteristics. Initial development of the mine (including ground-
complete. Best Management Practices (BMPs) will be
clearing activities) may lead to an increase in soil erosion. The
Soil implemented during the construction phases of the Project in
stockpiling of ore and disposal of waste rock and tailings during
order to minimize vegetative losses and soil erosion which could
operations could result in limited soil contamination. There is also a
Physical
lead to sedimentation of the surrounding natural drainages.

potential for soil contamination from warehousing, handling and
Programs will be implemented to evaluate soil quality during the
utilization of chemicals, fuels, oil and greases.
LoM.
The environmental license granted includes a requirement that
MCSA present a comprehensive study detailing groundwater and
Elements which may have an influence on groundwater in the ADA are
surface water availability for the mining operation and the
Groundwater principally related to sanitary effluents, tailings leachate, and the
surrounding villages. The presentation shall include maps, water
spillage and leaks of petroleum hydrocarbons.
supply alternatives, and current water sources inside the ADA
and AID (Direct Influence Area).
The EIA report describes that process water and tailings decant
Potential impact to are surface water could result from effluent
water are to be recycled at the plant for re-use in the operation.
Surface water discharges and surface water runoff, and include increased turbidity
Mitigation proposed focusses on the use of drainage channels
and siltation, as well as color changes
and decantation dikes to control the off-site migration of water.
September 7, 2017
Impacts to the flora of the region include the removal of vegetation for
A dust suppression plan will be developed to minimize impact on
the mine area, processing plants and supporting infrastructure.
Flora local flora. In addition, measures will be taken, as necessary, to
Particulate material deposition on nearby vegetation may affect the
stimulate and maintain vegetation growth after mine closure.
development of some species in the remaining forest within the AID.
Potential impacts to fauna include loss of habitat, increased

Biotic
mortalities, displacement of wildlife, interference with nearby Although the EIA report describes that there will be a wildlife
populations, and a change in the aquatic community. The greatest monitoring program, it does not describe a detailed methodology
identified impact is directly associated with vegetation loss, which is for action. Degraded area rehabilitation programs for flora,
Fauna necessary for project development. This reduction of habitat may fauna and aquatic communities will be developed. Additional
adversely affect species due to displacement into surrounding areas. information, where submitted to Environmental Agency, may be
For aquatic species, the removal of soil and vegetation, needed to create provided that concerns about areas which may serve as
waste rock piles and tailings dams, can decrease nutrient availability migratory sectors for fauna reestablishment.
given a potential alteration in water chemistry.
Access to The EIA presented data showing that local residents have limited access
water for to fresh water in the Directly Affected Area (ADA). Water is generally The VOGBR produced in 2014 a project to design a Water Dam to
local supplied by shallow wells or small springs. guarantee the supply of 150 m³ / h for one year without
residents in Unfortunately, some of these dry out during the dry season, and locals interruption, for the plant.
depend on neighboring areas to supplement their fresh water needs.
ADA
Because of inherent social adaptation necessary for the success
Physical Physical displacement of local residents has a significant impact on
of the Project, a negotiation plan with residents was another
displacement communities. There are nine properties inside the ADA.
Socio-economic
condition imposed by SEMA as part of the approval of the PL.
The EIA notes that, during the Project construction, about 1,000 workers
will be at the site. During mine operation, about 500 direct jobs and 130
A monitoring program of socio-economic indicators will be
indirect jobs are anticipated. Due to other projects currently underway,
Labor implemented, in order to evaluate possible changes in public
the city of Tucumã is under emigration pressure. The Boa Esperança
service provision and the population's quality of life.
Project is expected to increase emigration into the area and could
exacerbate this situation.
At the public hearing on November 27, 2009, the Public ministry

Impact on As a function of immigration and emigration to the area, the Project will and community members stated their concerns regarding public
public impact various socioeconomic sectors like education, health and social safety based on previous experiences with other mines in the
entities assistance. region. The result of the discussion was an agreement for a tax
increase of 25 percent to go to the municipality for public safety.
September 7, 2017
20.7 Environmental Impact Issues

Investigations into groundwater and surface water were carried out from 2008 to 2010. According to
CONAMA Normative Resolution # 357 (2005), water surrounding the Boa Esperança Project is
classified as class 3. Some of the samples exceeded the patterns established for this standard. Water
classified as class 3 can be used for the following purposes:
a) Human consumption, after conventional or advanced treatment;
b) Irrigation of trees, cereals and forage;
c) Recreational fishing;
d) Secondary contact recreation; and
e) Consumption by livestock.
Water quality is the product of its interaction with the various geological components (soils and rocks),
subject to weather conditions and various degrees of weathering. Some substances, even at low
concentrations, may be considered toxic to the environment. These substances can be natural,
because of the geological formation of the area, or their release into the environment may be related
to human activity.
SRK recommends the continuation of pre-operational monitoring, with the aim of establishing the
geochemical background of the water. Through the Hydro-geochemical background it will be possible
to distinguish any anomalous concentrations of naturally occurring elements in the region before the
project commences from any possible accidental or unexpected releases that may occur during
operation. This will allow the company to protect itself against accusations that could arise in the event
of the contamination of water resources and soil. The data collected from the background water can
still be used by the project as a reference during the execution of the closure plan.
SRK recommends expanding the program and sampling an area (in the form of a grid) of ground and
surface water covering the entire directly affected area (ADA) and the area of direct influence (AID).
The inclusion of parameters is recommended for the water sample analyses. Due to occurrence of
geochemical anomalies in the soil, such as Co, As and Mo, it is recommended that such parameters
be included in the analysis of water samples. Among these elements, As is the one with the greatest
environmental importance. Being a toxic element, even at low concentrations, As levels should be
monitored due to its association with the mineral pyrite, which makes up the gangue of copper
mineralization. Arsenic may be released into the environment during the sulfide mineral leaching
process (acid rock drainage).
20.7.1 Pollution and Water Quality

Minor streams have been identified within the directly affected area (ADA) of the project, some of
which are perennial. The drainage channels within the ADA are classified as lotic systems, consisting
predominantly of flowing freshwater and minor streams.
Minor streams located in the ADA can potentially be impacted by mining activities. In order to prevent
a change in the water quality in these streams, two sedimentation basins, interconnected by a system
September 7, 2017
of gutters, will be built. The gutter system is designed to collect the effluent from the processing of ores
and rainwater.
The project shall reuse the outflowing waters from the tailings dam. Additional water volumes will be
adduced from underground catchments in semi-artesian wells drilled around the venture by surface
pipe.
The quality of natural water is the product of interactions between the biota (algae, fungi, bacteria,
flora and fauna and their ecological relationships) and abiotic medium (atmosphere, lithosphere,
hydrosphere and pedosphere). The quality of natural waters can be established through an
assessment of physio-chemical parameters such as pH, temperature, dissolved oxygen, conductivity,
redox potential, total solids (soluble and particulate), color, turbidity, quantification of majority ions such
as K+, Na+, Ca2+, Mg2+, SO42-, Cl-, NO3-, F-, and minority ions, such as metal or micropollutants,
which can be quantified according to the purpose and areas of interest of the analysis. The sanitary
standards of water quality can also be evaluated by carrying out microbiological analyses of
parameters such as bacteria, algae, fungi, protozoa, viruses and other microorganisms harmful to
human health.
Sampling campaigns were performed in order to establish the quality of surface water within and
surrounding the Project. Subsequently, groundwater sampling tests were also carried out. Sampling
tests prior to the installation of the project are important to assess possible changes in water quality
over the life of the mine, as a reference for the implementation of mitigation measures and to comply
with current legislation.
Table 20.3 shows the sampling points and the period in which the samples were obtained and Figure
20-8 shows the location of these points. All samples collected, with the exception of the BE12 sample,
came from surface water.
Table 20.3: Sampling points in the Boa Esperança project area
Period Sampling point Coordinates UTM

BE 01 451154 9240869
BE 03 451216 9241896
BE 05 451240 9242950
March 2008
and July 2010 BE 06 451061 9242734
BE 07 451013 9242567
BE 08 450402 9242493
BE 09 450265 9241911
BE 11 449581 9242013
BE 12 449360 9242073
March 2008
BE 13 450862 9240907
BE 16 450048 9241152
BE 17 449325 9242028
BE 18 450413 9242500
April 2010 BE 19 451096 9241880
BE 20 451326 9241628
BE 21 451285 9241378
September 7, 2017
BE 22 451590 9240934
BE 23 450909 9240878
BE 24 450725 9239948
BE 25 450832 9240088
BE 26 450264 9241408
BE 27 449162 9241348
BE 28 450405 9240492
The purpose of these tests is to establish parameters that may change during the operational phase
of the project. The surface water sampling points were chosen in order to cover the mine area and
processing plant, areas of water extraction and points of effluent emission. The results show the
anthropic influence in any future development.
When compared with Class 3 quality water as established in CONAMA Resolution # 357 (2005),
shown in Table 20.4, the samples showed changes in some parameters. The most pertinent change
related to fecal coliforms above the limit set by the resolution. CONAMA Resolution # 357 (2005) states
that for the use of secondary contact recreation, water should not exceed a limit of 2,500 fecal coliforms
per 100 milliliters. Water for consumption by confined animals should not exceed a limit of 1,000 fecal
coliforms per 100 milliliters.
September 7, 2017
Figure 20-8: Location of water sampling points at Boa Esperança Project area
September 7, 2017
Table 20.4: Fresh water quality pattern (class 3) for select parameters, in accordance with
CONAMA Resolution #357 (2005)
Class 3 – Fresh Water Patterns
Parameters Maximum value

Total solids 500mg/L
Biochemical oxygen demand, 5 days at 20°C 10mg/L
Dissolved oxygen >4mg/L O2
Turbidity Up to 100UNT
pH 6,0 – 9,0
Color Up to 75 mg Pt/L
Chloride 250mg/L
Cooper 0,013mg/L
Iron 5mg/L
Lead 0,033mg/L
Nitrate 10mgL N
Nitrite 1,0 mg/7 N
Nickel 0,025 mL/L
Nitrogen ammonia total (pH ≤ 7.5) 13,3 mg/L
Phosphorus 0,15mg/L
Sulfide 0,3mg/L
Sulfate 250mg/L
Zinc 5mg/L
Standard limits for thermotolerant fecal coliforms were exceeded in samples BE01, BE02, BE03,
BE04, BE05, BE06, BE07, BE08, BE9, BE18, BE22, BE23 and BE27. This alteration is due mainly to
the presence of communities, livestock and ranching in the area.
In general, all the samples show alterations in the color pattern. This alteration is due to human actions,
depending on the population density, and the presence of pigments due to plant degradation.
As a result of the laterization process, all samples had an iron content above the permitted threshold
(5mg/L). However, the levels of the other metals tested (Pb, Cu, Ni and Zn) are below the limit.
Samples BE01, BE03 and BE06 contained excessive levels of sulfides. This may be explained by the
presence of communities, livestock and ranching in the area. Sulfate levels exceeded acceptable limits
in sample numbers BE01, BE02, BE03, BE04, BE05, BE06, BE07, BE08 and BE9.
Samples BE09, BE11, BE13, BE16, BE17, BE18, BE19, BE20, BE21, BE22, BE23, BE24, BE25,
BE26, BE27 and BE28 showed phosphorus and nitrite levels above those recommended. High levels
can be related to the use of phosphate-based fertilizers and/or possible contamination by domestic
and agricultural effluents.
September 7, 2017
The pH value remained consistently between 5.5 and 7.0. CONAMA Resolution # 357 (2005) states
that the pH range should be between 6 and 9. Only samples BE18, BE24 and BE25 contained pH
levels below 6. However, it should be remembered that natural waters have a slightly acidic pH level.
Samples showed the biochemical oxygen demand (BOD) was below the required limits, though
samples BE17, BE20, BE24 and BE25 showed a low concentration of dissolved oxygen. In this case,
the low concentration of oxygen dissolved in the water is a deleterious trait.
Regarding the level of turbidity, the following samples exceeded the limits specified in the relevant
legislation: BE11, BE 13, BE18, BE22, BE24 and BE27. That being said, the proportion of total solids
(suspended and dissolved) was well below the limit.
The groundwater sample (BE12) has a high content of Fe and Ni, close to the limit described in
CONAMA Resolution # 396 (2008). Due to the Fe content, the water is unsuitable for human
consumption. Therefore, in order to be used for this purpose, pretreatment for metal removal would
be required.
In all the water samples the cyanide content was analyzed, as was the presence of mercury, oils and
greases. The results concluded that these substances are virtually absent from the samples.
20.7.2 Acid Rock Drainage

The oxidation of sulfide minerals is the main mechanism for acid rock drainage formation. These
minerals, once exposed to ambient weather conditions, Eh, pH, and biological agents, can oxidize and
result in acidity. Chemicals containing sulfur are the primary source of acidity and some (such as
metals) can potentially be toxic.
An Fe (II) ion formed by reaction (1) can be oxidized to F (III) by atmospheric oxygen, precipitate as
iron hydroxide (III) (Fe(OH)3) and release more acidity into the environment. Thus, the production of
acid is increased and pH levels are reduced. Under these conditions, Fe (III) ions remaining within
aqueous solutions can react with sulfide minerals.
The Fe (II) oxidation reaction is catalyzed by acidophilus microorganisms, such as the bacteria
Leptospirillumsppor Acidithiobacillus spp. These microorganisms play an important role in the
oxidization of iron and sulfur. They are able to oxidize insoluble metal sulfides, elemental sulfur (S0)
to sulfate (SO42-) and, furthermore, form sulfuric acid (H2SO4).
In some cases, the consequences of acid drainage can take several years to be identified because of
the alkaline composition of the minerals within soils and rocks in the region.
The main environmental impacts of acid mine drainage are:
• Reduction in the pH level of natural waters below 4. Under these conditions, most metal ions
are soluble. Metal ions can be released into the water resources, both surface and
groundwater. Their concentration levels can range from 100 to 3,000 mg/L.
• Hydroxides, such as iron hydroxides (III), can precipitate on the river bed and directly affect
the aquatic biota and increase the turbidity of the water. In addition, levels of dissolved oxygen
can be reduced.
These impacts affect the development of aquatic life at all trophic levels of the food chain and make
the water unsuitable for human consumption, the watering of livestock and agricultural use.
September 7, 2017
One of the most important environmental issues for the Boa Esperança Project is the generation of
acid mine drainage. In the 1980s, many entrepreneurs wrongly assumed that the geological material
was not potentially acid generating. This erroneous assumption was made due to the presence of
alkaline minerals, such as calcite, which neutralized the acid generated by sulfides. However, the
naturally occurring neutralization process only occurs until the alkali minerals exhaust themselves. It
is at this point that the problems related to acidity in the effluent were demonstrable.
A geochemical analysis has been carried out in the Boa Esperança Project area with the intention of
predicting the potential to generate acid drainage from geological materials. SRK recommends that
these tests be continued, as the number of samples tested (two) are not representative of the entire
project area. The steps to be expanded and complemented are described below:
• Development of a conceptual geochemical model: The development of the conceptual

geochemical model allows geological materials to be classified according to the lithology and
mineralogy of the deposit. For the preparation of the conceptual model, criteria should be
established for geochemical classification of the geological materials. The geological materials
should be grouped according to their geochemical character and this grouping can be used to
create a conceptual model and thematic maps that will help with the next step, the collection
of samples. Materials can be classified according to their rock types, type of change (or
hydrothermal supergene weathering, for example), mineralogical composition (mineral
classification according to the sulfur content and/or associated gangue minerals), processes
from which they originated (in the case of waste) and others.
• Sampling: This step consists of collecting samples for the evaluation of the potential for acid
drainage generation. The number of samples must be representative of each region
established in the conceptual geochemical model. Surface samples and samples in the
subsurface should be collected. They must be numerically sufficient to allow for a thorough
statistical analysis.
• Static tests to evaluate the acid drainage potential. MABA and NAG should be carried out in
accredited laboratories, adopting QA/QC criteria (Quality Assurance vs. Quality Control).
• Samples with a potential for acidity should be subjected to kinetic assays for a recommended
period of 52 weeks. Kinetic assays evaluate the behavior of the samples when exposed to
weather conditions with both high and low levels of humidity. The kinetic experiments can
establish the time that the samples take to generate acidity, as well as the characteristics of
the effluent and the rate of metal leaching
Geochemical evaluations are important because they allow the assessment of the risk contained in
the mine water and its potentially adverse effects on wildlife, agro-pastoral activities and water
resources. It is possible to determine whether treatment of mine effluent is necessary, to scale it and
to estimate the long-term costs. There has been a growing concern on the part of the government in
light of the issues related to the generation of acidity in mines. This procedure allows us to anticipate
legal requirements and any other issues of this nature that may become important in the future.
20.7.3 Static Tests for Evaluation the Potential for Acid Rock Drainage
Formation
In January, 2015 tests were carried out to evaluate the potential for acid drainage generation by
GEOSOL. Table 20.5 shows the results of static tests on samples of Jigging and Pyrite waste.
September 7, 2017
Table 20.5: Results of static tests (Source: SRK, 2015)
NP AP NNP NAPP NAG pH NAG pH 4.5 NAG pH 7

Samples %S NPR
kg CaCO3/t kg H2SO4/t
Jigging waste 0.41 25.51 9.31 16.18 2.74 -15.88 5.85 0.00 0.40
Pyrite waste 0.15 30.95 2.97 28.01 10.42 -27.42 6.12 0.00 0.10
Initially, the sulfur content (% S) of the samples was compared with the NPR values (Figure 20-9).
Figure 20-9: Comparison between sulfide content (%) in the sample and Neutralization
Potential Rate (NPR) (Source: SRK, 2015)
To analyze the results, the worst-case scenario, where all of the sulfur contained in the sample is in
the form of sulfide, was used. It was found that samples with a sulfur content lower than 0.1% are not
capable of generating acid, regardless of the potential for neutralization. It was observed that both
samples showed a sulfur content above 0.1%. The sample of pyrite waste has the potential to
neutralize its own acidity. However, these results were inconclusive for the sample of Jigging waste.
Having compared the results of the NAG and MABA tests simultaneously (Figure 20-10), neither
sample can be classified as generating acidity.
In addition, neither sample demonstrated a NAGpH level of 4.5, indicating the absence of free acidity
by sulfate. However, the results of NAGpH 7 show the occurrence of metal ions, such as Zn and Cu
(Figure 20-11). Samples with an NAPP >0 are classified as potentially generating acidity (PAG) and
September 7, 2017
those with an NAPP <0 are not classified as potentially generating acidity (non-PAG). Simultaneous
analysis of NPR and NAPP confirms the non-PAG status of the samples (Figure 20-12).
Figure 20-10: Simultaneous analyses of the neutralization potential rate (NPR) of samples and
net acid generation (NAGpH) (Source: SRK, 2015)
Figure 20-11: NAG tests results: Samples do not have free acidity due sulfite oxidation
(Source: SRK, 2015)
September 7, 2017
Figure 20-12: NAG Simultaneous analysis of the potential neutralization of samples (NPR) and
acidity production of liquid potential (NAPP) (Source: SRK, 2015)
In general, the samples showed no potential for acid generation. However, kinetic testing of the sample
of Jigging waste is recommended due to its low neutralization potential in relation to its sulfur content.
The kinetic tests are aimed at sampling performance evaluation over a hydrological year (minimum)
in a controlled environment (columns). The results of the kinetic tests will confirm the non-generation
of acidity from the sample of jigging waste.
20.8 Environmental Compensation

Under applicable law, MCSA must allocate financial resources for the implementation and
maintenance of a Conservation Unit for Integral Protection and Sustainable Use (SNUC Law), applying
the polluter pays principle, which is considered crucial for Brazilian environmental policy, and requires
the user of natural resources to pay for its use.
The determination of the amount relating to environmental compensation shall occur at the time of
issuance of the Installation License – LI. The Environmental Agency should set the compensation
levels, consistent with and proportional to the degree of environmental impact of the project. This
should be determined according to the composition of the environmental impact stated in the EIA /
RIMA. The calculation methodology should be based on a ranking calculation of environmental
impacts for environmental compensation was presented by MCSA to SEMA in 2014.
The environmental compensation calculation for the project was obtained using the environmental
impact grading methodology for significant environmental impacts established by Law # 9.985 / 2000
(art.36), with the new wording of Federal Decree # 6.848 /09 (art. 24), VI, VII, VIII of the Federal
Constitution, Law # 6,938 /81 and the CONAMA resolution and terms of reference attached to
Normative Instruction # 43 of October 5 2010, replaced by Normative Instruction # 10/ 2014.
The values presented will be available to SEMA as established by SEMA Instruction # 01/2013 and
will be regulated by entering into agreements and Terms of Agreement for the environmental
September 7, 2017
compensation calculation in compliance with environmental compensation obligations resulting from

the licensing process for the environmental enterprise.
For environmental compensation purposes the Directly Affected Area - ADA was accounted for and
comprised the space where all facilities will be allocated and where the direct impact of the project
implementation stage will be felt.
Figure 20-13 shows the existing vegetation types to be preserved in the Directly Affected Area - ADA,
with the largest regeneration stage indicated by a dark green color.
Figure 20-13: Vegetation types found in project area (Source: MCSA, 2014)
The Boa Esperança project is set in an area classified as High Importance and Extreme Importance
for the conservation of biodiversity in the Amazon Biome.
20.9 Communication with Stakeholders

The diagnosis of the environmental baseline studies gave the stakeholders prior knowledge of the Boa
Esperança Project. MCSA presented programs during the LI process stage, which include this topic.
Stakeholder engagement, disclosure and dissemination of information and consultation and
participation are fundamental from the beginning of the project for the development of mechanisms
which will allow interaction with the community.
September 7, 2017
20.9.1 Program for the Monitoring of Socio-Economic Indicators

The program used to monitor socio-economic indicators was first revealed during the installation
license phase and addresses the following objectives:
• Establishment of partnerships with the municipal administration;

• Regular use of questionnaires relating to the living conditions of the population affected by the
project;
• Monitoring of education indicators, health, housing, public safety, infrastructure, population
dynamics and production activities in the city of Tucuman;
• Identification of social and economic changes resulting from the project and the incorporation
of related programs to mitigate these changes when they prove to have a negative impact.
Biannual meetings are planned with the participation of municipal administrators to exchange
information about the project’s interference in the lives of surrounding communities and improvements
to the quality of life of local people.
Economic indicators will be monitored through a partnership with public institutions and mitigating
measures, which are necessary for the implementation and operation of the project, will be adopted.
The main indicators to be monitored include: enrollment in municipal schools, morbidity and mortality,
major diseases, migration, population growth, housing (rents, sanitation and housing sites), productive
activities and value of production, among others.
At first, the target audience of the socioeconomic indicator monitoring program includes: the general
population and community leaders in Tucuman, municipal departments and the municipal government
and research institutions.
This program should begin three months before the mobilization of the project installation works and
at least one year prior to the operational start date.
20.9.2 Social Communication Program

The social communication program looks at the availability of and access to information as a
fundamental tool for awareness, dialogue, understanding and integration between employees of the
project, the government and the community. This will be based on the following principles:
• Fostering of social communication processes involving environmental education, with regards

to the mission, vision and values of the project;
• The practice of sustainable development, as recommended by the Brazilian Agenda and
national and state environmental policy;
• Communicative activities based on the future pillars of education proposed by UNESCO,
determination of national and state policies on the environment and the educational
communication proposals from the Ministry of Environment (MMA);
• Maintaining channels of communication with the community and local government;
• Respect for local culture, knowledge and organizations;
• Inclusion of contributions from community participation and local government;
• Communication to facilitate accessibility, transparency, ethics and sustainability; and
• Monitoring and evaluation of the environmental aspects of communicative activities with the
local communities, thereby making them effective tools.
September 7, 2017
The target audience of this program includes employees of MCSA, the local community, visitors and
governmental institutions.
20.9.3 Environmental Education

Environmental education within the environmental licensing process is governed by Decree # 4281,
2002, which regulates the National Environmental Education Policy (Law # 9.795 / 1999), according
to which environmental education programs should be set up, maintained, implemented and integrated
into the licensing activity for potentially polluting activities.
CONAMA Resolution # 422/2010 establishes guidelines for environmental education projects. An

Environmental Education Program (PEA) was presented during the LI process of the Boa Esperança
Project, and is intended to develop educational activities with the project developers, the community
and schools, in line with the demands of the project and with respect to environmental matters.
The PEA should establish partnerships with governmental and non-governmental organizations, both
local and state, in order to assist with their actions and improve their results.
Environmental consultants will be hired to coordinate environmental education teams that will ensure
the qualified and responsible development of the projects that constitute the program.
The PEA monitoring and evaluation process should be undertaken using specific instruments at the
end of each activity, with reports of all actions being produced.
The program should adopt the ISO 14031 (Environmental Performance Assessment) guidelines.
20.9.4 Labor jobsite Hiring

This program aims to hire, whenever possible and within the requirements of the production process,
labor that resides in the project area and to influence and train people with the potential to take jobs
that require formal technical education.
Caraíba has already estimated the future contracted positions shown in the EIA / RIMA. This will allow
for the development of their procurement program and local workforce training with a focus on social
responsibility and sustainability guidelines and policies.
The steps in this program are described as follows:
• Establishing the required manpower profile; consolidating information on the profile of the
manual labor required to operate the project;
• Demand disclosure required for the project: the company will publish the required manpower
profile. To avoid speculation and disorderly displacement of people to the area, this publication
will be undertaken judiciously;
• Registration of candidates in Tucumán: the registry will feed a database for the recruitment of
manual labor;
• Candidate profile analysis: The suitability of candidates in relation to the project’s requirements
through qualification and training in partnership with public and private institutions and through
the monitoring of hired labor and the updating of the database.
This program will be monitored in partnership with the local government of Tucumã.
September 7, 2017
20.9.5 Support for the local development forum

The Local Development Forum has the role of involving representatives of public and private
organizations so that they can contribute to local development, thus creating spaces for reflection on
and discussion of the objectives, goals, costs and benefits of this process.
This forum should be politically neutral and independent and communicate in an open manner between
groups with different interests, whilst at the same time pursuing the common goal of improving the
living conditions of the local population through sustainable development processes. The procedures
within this context are outlined below:
• Preparation of a base document for the operation forum;

• Identification of potential participants for the forum;
• Preparation of the physical space for the operation forum;
• Constitution Forum (first meeting);
• Training of participants;
• Technical assistance for the preparation of a local development plan;
• Technical assistance to the Forum for the implementation of a local development plan;
The partnership between MCSA, the municipal government and ACIAPT (Association Comercial e
Industrial de Tucumã) will take responsibility for the provision and maintenance of the physical
infrastructure of the facilities that will host the forum. The advisory committee will be put in place and
will be responsible for organizing the constitutional process as well as the education and training of
forum members
20.10 Mining Closure and Reclamation

Mine Closure describes activities that are required to stabilize a closed site in such a condition that it
is appropriate for the establishment of Post Mining Land Use(s). Planning for mine closure should be
treated as an integral component of the operational planning, since the decisions made during the
operational planning process have the potential to significantly impact environmental rehabilitation and
mine closure outcomes. As such, mine closure planning needs to be appropriately integrated into the
different stages of the life of a mine and be flexible enough to allow for an adaptive management style.
Adaptive management is a systematic process for the continual improvement of management policies
and practices through learning from the outcomes of the operational program.
Consequently, closure planning should also be integrated into the environmental management system
for the operation or site as much as possible. An integrated approach to mine closure planning is
critical to achieving successful closure outcomes.
[In Brazil, at the time of the Effecitve Date, the Plano de Recuperação de Áreas Degradadas (PRAD)
contains no legal provisions that require a mining company to provide any form of financial assurance
to cover their closure costs. Instead, a form of financial royalty of 2% to 3% of mineral production for
the extraction of Mineral Resources is applied to the operation. The royalty is divided between the
state government and the federal district, the counties, and the National Department of Mineral
Production. The revenues raised by the counties are to be applied to projects that directly or indirectly
support or compensate the local community from any losses associated with the mine. These projects
September 7, 2017
can include improvements to infrastructure; environmental remediation; public health projects, and
education and outreach programs.
Compliance with Legal Reserve regulations is absolutely necessary to optimize negotiations during
the permitting process. Ideally, a detailed plan or methodology regarding where and how original
vegetation can be restored to 1970’s conditions would be emphasized. This topic is particularly
relevant given past deforestation activity and a consistent decrease in ecologically preserved areas.
For Boa Esperança Project the follow closure methods and objectives for each area are described:
Open pit
Geotechnical stability is ensured through regular inspections by qualified geotechnical personnel, and
safety is ensured by restricting access to the pit using appropriate bunding and fencing. Groundwater
recovery and quality are monitored by piezometers and boreholes respectively, around the perimeter
of the pit and beyond.
The physical stabilization of the smoothed upper slopes of the open pit at the Boa Esperança Project
will be reinforced and the water table level will be restored, creating a lake in the pit area, revegetation
carried out using native plant life in the upper portions of the former mine, and environmental
monitoring will be implemented.
Tailing Dam
The remaining water of tailing dam B2 will not be drained, but left to evaporate over time. The dam
site will be isolated with fences to avoid injury to people and animals. Studies for the coverage of the
dam by deploying an HDPE geomembrane as well as clay coverage for subsequent revegetation
forming an "enveloping" of the material will be carried out.
Saprolite and Waste Rock Pile
Geotechnical monitoring through settlement and ground movement measures will be carried out during
the operation of the mine. To this end, topographic marks will be installed and verified on a monthly
basis. To monitor the foundations, water level monitors will be installed inside drillholes. Visual
inspection can be carried out monthly, mainly during rainy periods, aiming to identify possible erosive
processes, drain obstructions, the saturation of decanter t the occurrence of cracks, etc.
Settlement and ground movement measurements will be taken during the operational phase for the
purpose of geotechnical monitoring. For this purpose, topographic marks will be installed and verified
on a monthly basis. To monitor the foundations, water level monitors will be installed inside drillholes.
Visual inspection could also be carried out on a monthly basis, mainly during rainy periods, aiming to
identify possible erosive processes, drainage obstructions, decantation tank saturation and the
occurrence of cracks, etc.
As a closing measure, it is expected that re-contouring of the slope of the pile where it is subject to
conditions of instability or erosion will be undertaken using soil placement on the plateau and
subsequent reforestation and environmental monitoring.
Industrial Area
As a closing measure, the demolition of structures, adjacent areas and sheds, etc. is expected. The
concrete waste may be deposited in the waste dump or another waterproof location. After that, the
whole area may be used for revegetation following the same criteria as for the open pit mine and waste
September 7, 2017
dump. Some administrative buildings can be left in situ to provide support for activities relating to the
future use of the area, should there be sufficient interest.
Unit Decontamination
Decontamination of non-porous surfaces such as tanks and metal piping can be accomplished through
washing. Tanks may require entry procedures for a confined space. A detergent may or may not be
used. Steam cleaning is another available option. The efficient removal of hazardous waste residues
is the goal. After cleaning, the tank must be sampled for analysis.
Porous surfaces provide a unique problem for decontamination. If a surface such as concrete (i.e., a
container storage pad) has been covered with an impervious coating prior to and during its service as
a hazardous waste management unit, steam cleaning or detergent washing may be sufficient for
complete decontamination. However, if the coating has been compromised or was added after
management operations began, the concrete may have hazardous waste residues in the concrete
matrix. If steam or detergent cleaning is insufficient, removal of all or part of the concrete may be
necessary. The facility owner or operator should determine which is more economically feasible:
complete removal of the concrete or removal of layers of the concrete. Methods are available for
removing layers of concrete without demolishing the entire concrete slab. The costs of disposal of the
volumes of concrete generated, the costs of labor involved and analytical costs for the proper disposal
of this material should be taken into consideration. The main goal of the process is to remove
contamination in the most efficient manner possible.
Subsurface soil presents several problems, including accessibility. Methods are available for treating
soil in situ. However, treatment of soil in situ is considered part of the post-closure and corrective action
process and would not be part of a closure plan. A means of determining the amount and the real
extent of soil to be removed should be provided in the closure plan.
All equipment and systems used to manage hazardous waste at the site and used in clean-up at the
site must be decontaminated. The closure plan must include a detailed description of the steps needed
to decontaminate all hazardous waste residues and contaminated containment system components,
equipment, structures and soils during partial and final closure, including (but not limited to) procedures
for the cleaning of equipment and removal of contaminated soils, methods for sampling and testing
the surrounding soils and criteria for determining the extent of decontamination necessary to satisfy
the closure performance targets. Decontamination should be carried out in such a way so as to not
contaminate new or previously cleaned areas.
All decontamination fluids generated during the decontamination processes must be contained and
sampled before the proper disposal determination(s) can be made. Once a piece of equipment or an
area or a fluid is decontaminated, its cleanliness must be verified. To verify decontamination
appropriate, quality assurance/quality control samples must be taken. The amount and type of these
samples will vary with the size, material and both past and future uses of the equipment in question.
These samples could be in the form of a visual inspection, wipe samples, chip samples, etc. The
decontamination procedures should therefore include a detailed sampling and analysis plan that would
be applicable for all materials that are to be decontaminated.
September 7, 2017
20.11 Recommendations
Communication with all stakeholders should be an on-going activity within the Project. The Project’s
Social-Environmental management should be pragmatically undertaken and continuously reviewed
and improved.
Acid drainage studies should be expanded so as to ensure that the sample is representative of the
entire Project.
Development of a conceptual geochemical model of the Project area should be conducted.
The Legal Reserve, an area set aside for the preservation of the natural environment, a condition for
the IL, must be set out to ensure project timing. In this regard, the day-to-day follow-up of the
environmental licensing and its conditions at all levels must be carefully completed.
September 7, 2017
21 Capital and Operating Costs

21.1 External Considerations
SRK relied on Ero Copper Corp. and MCSA for pricing, tax and vender quotes obtained by MCSA
personnel. SRK has reviewed the market studies referenced in Section 19 and vendor quotes obtained
by MCSA and found the parameters to be reasonable and in line with industry norms.
21.1.1 Economic Considerations

The forecast copper prices used in the economic analysis are presented in Table 21.1.
Table 21.1: Copper Prices - US$/t-Cu
Commodity Yr 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7 Yr 8 Yr 9 Yr 10 Yr 11
Copper 6,063 6,614 6,614 6,614 6,614 6,614 6,614 6,614 6,614 6,614 6,614
The copper concentrate price is considered CIF at the port of Shanghai, China. The logistics costs to
transport copper concentrate from the Project to Shanghai, are presented in the Table 21.2 and Table
21.3. The logistic cost was considered as 50% "Bulk" and 50% "Container". The economic analysis
also considered losses of 0.2% in concentrate transportation for both cases.
Table 21.2: Logistic Costs - Container

Table 21.3: Logistic Costs - Bulk

Total Freight $478.83
21.1.2 Common Elements

Common prices for consumables, labor, fuel, lubricants and explosives were used by all engineering
disciplines to derive capital and operating costs. Included in the labor costs are shift differentials,
vacation rotations, all taxes and some of the payroll burdens. The remaining payroll burdens are
included in the G&A costs.
All common elements costs have been quoted by MCSA with local suppliers. The cost associated with
power consumption was based on the following rationale:
• Demand: 9,100 kW; and

• Consumption: 7,460 kWh/h.
September 7, 2017
Electrical Power cost was calculated by Pará State electrical distributor (Centrais Elétricas do Pará -
CELPA), based on tariff marks system ("Bandeiras Tarifárias"), which indicate the energy cost
according the conditions of electricity generation. Nevertheless, Sol Energias, an electrical power
trading company, quoted electrical power cost in another type of contract commonly known as Free
Market ("Mercado Livre de Energia Elétrica"). As a result, Electrical power cost presented a reduction
of 38,54% in comparison with CELPA cost. This study used the electrical power cost into the free
market, estimated by Sol Energias trading company.
Based on consumption and demand obtained by Tecnomin Team engineers, Sol Energias Company
calculated the yearly power bill. This number was then used to generate an average cost per
consumed kWh.
Table 21.4 and Table 21.5 summarize most of the common factors. Labor is further discussed in the
operating costs sections of this report.
All currency is in Brazilian Reais (R$) unless otherwise stated. The following exchange rates have
been considered throughout the model.
Table 21.4: Exchange Rates

Exchange Rate (R$ per US$)
Currency Yr -2 Yr -1 – Yr 9
Reais $3.60 $3.80
Table 21.5: Project-Wide Common Cost Factors

Description Unit Value (R$/unit)
Power kWh 0.286
Diesel Liters 2.77
21.2 Capital Costs

21.2.1 Introduction
This Section of the report presents the Capital Expenditure (CAPEX) estimate for the Project, including
the following major items:
• Initial Capital Expenditure – direct costs, indirect costs and contingency.

• Stay in business costs – expenditure with mining fleet increase, mine roads development and
equipment replacement; and
• Closure costs – mainly expenditure associated with good environmental practice.
The capital cost estimate developed for this FS comprises the costs associated with the engineering,
procurement, construction, management, commissioning and pre-operation required for all project
facilities. The cost estimation was based on studies developed for the project by third-party engineering
firms, including SRK. SRK reviewed the work prepared by Tecnomin for Basic Engineering and
VOGBR for Basic Project Tailings Dam and the Conceptual Design of the Water Pond. The external
reports were used to inform the preparation of the capital cost estimates, which were prepared by
SRK.
• Tecnomin Projects e Consultoria Ltda (Minas Gerais, Brazil) - Basic engineering;

• Tyno Consultoria Tributária e Empresarial Ltda (Bahia, Brazil) - Fiscal;
September 7, 2017
• VOGBR Recursos Hídricos & Geotecnia (Minas Gerais, Brazil) - Basic Project of Tailing Dam
and Conceptual Design of Water Pond;
SRK has reviewed these studies and is of the opinion that they are satisfactory for inclusion in the
design and to facilitate the capital cost estimates.
The capital cost estimated is divided in direct and indirect costs. The estimate was coded in
accordance with the Capital Code Account and a Project Breakdown Structure (PBS), representing
the main areas of the project.
The required quotations for equipment, materials and services were obtained mainly by MCPD and
formal enquiries to well-known vendors in the mining business.
One of the objectives of this report was to prepare a capital expenditure estimate that corresponds to
the Class 2 estimate, according to the AACE International standards. The final accuracy range of the
estimate is considered to be -5% to +20%, which places the estimate within the Class 2 category.
An overall contingency of 7.73% resulted from the various accuracy ranges estimated for each of the
individual items.
The capital cost estimate summary for the base case at 100% equity is shown in Table 21.6 and Table
21.7.
September 7, 2017
Table 21.6: Capital Costs Summary per Area

LoM Cost Ongoing
Area % of Total (R$000’s) Initial (R$000’s) (R$000’s)
Pre-Production 14 89,306 89,306 0
Infrastructure 1 6,615 6,615 0
Mine 8 48,075 35,778 12,298
Plant 39 244,109 244,109 0
Power & Automation 12 76,709 76,709 0
Utility Systems 2 12,065 12,065 0
Administration & Support 4 23,562 23,562 0
Tailings Storage Facilities 7 45,439 45,439 0
Water Pond 1 6,398 6,398 0
Indirect Costs 10 59,740 59,740 0
Salvage -4 (24,796) 0 (24,796)
Closure 6 39,898 0 39,898
Total 100% R$627,120 R$599,721 R$27,400
Table 21.7: Capital Costs Summary per Type

Area % of Total LoM Cost (R$000’s)
Pre-Production 18 89,306
Mine Equipment 7 41,605
Other Mobile Equipment 0 2,621
Mechanical Equipment 21 129,147
Electrical Equipment 7 41,240
Instruments, Automation & I.T. 1 7,595
Civil Works 21 130,281
Metallic Structure 3 16,430
Assembling 14 88,748
Piping 0 2,227
Furniture 0 3,084
Indirect Costs 10 59,740
Salvage -4 (24,796)
Closure 6 39,898
Total 100% R$627,126
21.2.2 Methodology
The following method was used to estimate the items which make up the capital estimate:
• Major equipment, materials and services are based on formal (written) quotes;
• Items of lesser significance, such as airline tickets, hotel costs, etc., are based on informal
quotes (e.g., via emails, telephone calls);
• Quantity estimates were prepared based on engineering data for items not included in vendor
quotes. Unit costs were applied to these quantities and incorporated into the data base;
• Pre-defined rates were applied to the costs estimated through any of the above methods. This
includes indirect costs, such as freights, some spare parts etc.
• Calculations based on engineering or financial concepts, such as those used for computing
working capital or initial fills.
Formal quotes were obtained mainly in the 2nd quarter 2015 for most equipment, as well as for those
materials and services making up the major construction contracts such as civil works, structural steel,
September 7, 2017
piping, tailings dam, earthworks, and installation. The formal quotes represent about 99% of the direct
costs.
The inquiries were issued by MCPD with the appropriate engineering documents, such as process
and engineering flowsheets, single line diagrams, general arrangement drawings, plot plans, piping
plans, data sheets, equipment and instrument lists, material take-offs and tables of quantities.
Formal quotes for equipment or construction were requested mainly under the following conditions of
supply:
21.2.2.1 Supply Only

Supply only was used for most the equipment. Depending upon the specific nature of the equipment,
installation supervision was included in the vendor's scope of supply.
Packages were formed for items in the product line of individual suppliers. Thus pumps, transformers,
MCCs and others similar items were requested in lots.
21.2.2.2 Selection Bids

Bids technically unacceptable were discarded. The lowest price bid was chosen from the remaining
acceptable bids.
Project team selected all bids according with mentioned below:
• Selected the bid according to their best judgment which would present the best combination
of technical and commercial merits; or
• Selected the bid based on prevailing technical features which, due to their criticality to the
process, overruled any commercial aspect.
Since indirect costs are comprised of a variety of costs types, various methods were used to prepare
the estimates. Those methods are described in detail in the following sections, for each type of indirect
cost.
In all cases, the bids were requested in Brazilian Reais, inclusive of applicable taxes.
21.2.2.3 Capital Cost Estimate Structure

The capital cost estimate is divided by direct costs and indirect costs.
Direct Costs are the expenditure that will constitute the Fixed Assets on the operation of the enterprise.
These costs will be depreciated. Direct Costs have capital importance in the comparison with other
projects (benchmarking).
Indirect costs are either distributable or non-distributable. Distributable indirect costs are those indirect
costs which can be assigned to a specific project area or equipment, whereas non-distributable indirect
costs are those allocated to the project (General Area). Contingency is an example of distributable
costs and in this estimation, it was calculated for each item of cost.
September 7, 2017
The system in which those divisions are made is called Project Breakdown Structure (PBS). What
follows is the PBS adopted for the Project, where the detail extends to the second level in the
breakdown hierarchy.
General
• Infrastructure:
o General,
o Earthworks,
o Drainage System, and
o Accesses.
• Mine:
o General,
o Access Ramps,
o Explosives Shed,
o Equipment Fueling Station, and
o Drainage System.
• Sulfide Ore Beneficiation Plant:
o General,
o Primary Crushing;
o Secondary & Tertiary Crushing and jigging,
o Grinding & Classification,
o Flotation,
o Re-Grinding,
o Thickening,
o Filtering,
• Power & Automation:
o General,
o 138 KV Line - 15 km,
o Main Substation,
o Substation – Crushing, Jigging, Screening and Grinding,
o Substation – Re-Grinding, Flotation and Filtering,
o Substation – Admin. Buildings, Labs and Shops, and
o Substation – Water Collection.
• Utilities System:
o General,
o Water Collection,
o Water Re-Circulation,
o Compressed Air,
o Sewage Treatment,
o Fire Emergency System,
o Potable Water System, and
o Sealing Water System,
o Dust Control System,
o Reagent Prep.
• Administration & Support:
o General,
September 7, 2017
o Gate,
o Truck Scales,
o Safety and Fire Brigade,
o Main Office,
o Support Buildings,
o Locker Rooms,
o Kitchen and Restaurant,
o Fueling Station,
o Tanks,
o Plant Maintenance Shop,
o Warehouse,
o Junk Yard,
o Laboratories,
o Clinic,
o Parking Lots,
o Core Shed,
o Vehicle Shop, and
o Equipment Washing Stations.
• Tailings Storage Facilities
o Tailings Dam - B2 - high sulfur
• Water Pond:
o Water Pond,
Additionally, the following costs are part of the capital cost estimate:
• Contingencies;
• Stay in Business (SIB) costs;
• Closure Costs; and
• Initial Working Capital.
21.2.2.4 Direct Costs

Direct capital costs were estimated for each Project Area and consist basically of the accounts
mentioned bellow:
• Pre-production;
• Mechanical Equipment;
• Electrical Equipment;
• Instrumentation, Automation and IT System;
• Civil Construction and Architecture;
• Steel Structure;
• Piping;
• Vehicles;
• Furniture and Fixture; and
• Mechanical and Electrical Assembly
The following items expand on the estimate basis for each of these costs.
September 7, 2017
Pre-Production
Pre-production costs were composed by all necessary services for the overburden material removal
(Pre-stripping) and all necessary vegetal suppression (surface areas above open pit and waste piles
area).
Pre-stripping and vegetal suppression was quoted by MCPD and SRK.
Mine Equipment
Mine equipment was selected and estimated by SRK. The major equipment fleets were specified and
quoted by SRK. Ancillary equipment were quoted by MCSA.
Equipment – Process Plant, Utilities and Infrastructure
Mechanical Equipment
Tecnomin's process team prepared the Mechanical Equipment List and the Mechanical Equipment
Specifications, which were used by MCPD to obtain formal quotes from reputable equipment suppliers.
Electrical Equipment
Tecnomin’s engineering group prepared the Electrical Equipment and the Electrical Equipment
Specifications, which were used by Tecnomin to obtain formal quotes from reputable equipment
suppliers and contractors. Wherever appropriate, single line diagrams and general arrangement
drawings showing the routing of the transmission lines were included in the documentation.
A turnkey procurement supply condition was considered for the 138 kV main substation and overhead
transmission line (15 km) was quoted by CELPA. The main substation was quoted by MCPD with all
flowsheets and technical specifications prepared by Tecnomin's engineering.
A Supply Only procurement condition was considered for the remaining electrical equipment and,
wherever possible and practical, packages were put together for equipment such as transformers,
large motors, and motor control centers (MCC’s), frequency inverters, circuit breakers and others.
Instrumentation, Automation and Information Technology System (ITS) Equipment – Process Plant
and Infrastructure
Tecnomin’s engineering group prepared the Instrument List and the Instrument Specifications, which
were used by Tecnomin to obtain formal quotes from reputable equipment suppliers. A Supply Only
procurement condition was considered for that type of equipment and, wherever possible and practical,
packages were put together for the same type of instruments.
A similar approach was adopted for the automation system components and supervision software.
MCSA’s IT Department, following the requirements defined, prepared the IT system specifications
(servers, desktops, notebooks, printers and software) which were used by the MCPD to obtain formal
quotes from reputable hardware and software suppliers. A Supply Only procurement condition was
considered for those quotes.
The bid evaluation process, the suppliers’ selection and all other activities required for integrating the
hardware and software components into a working system and establishing the cost of that system
were carried out by MCSA’s IT Department.
September 7, 2017
Telecommunication System Equipment
The same process described in the section above was adopted for the quotation process and selection
of bidder for the telecommunications system.
Civil Construction and Architectural Services
Earthworks
Based on topographical project's data base, engineering layout drawings, plot plans, and earthworks
drawings were prepared for the process plant area and the dams which were used to calculate
quantities for estimating the cost of services.
SRK designed the Pre-stripping phase and quantified the earthwork related to pre-production for the
mine.
The gravel road from the site to PA-279 will be improved. Formal quotes for the earthworks were
obtained through MCPD from reputable local contractors.
Architecture and Concrete
Architecture design drawings developed for all auxiliary buildings and housing were used to obtain
formal quotes from reputable contractors via MCPD. The concrete foundations and industrial buildings
were designed in accordance to the considered loads and quoted by MCPD.
Structural Steel
Formal quotes for the steelwork (boiler and structural steel) were obtained for the total Project quantity.
Wear plates were included in the steelwork scope of supply.
The bid evaluation method for the steelwork was similar to that adopted for the mechanical equipment.
The main dimensions of the structural steel buildings are shown in the design general arrangement
drawings. These drawings, in conjunction with appropriate information, such as loads from the
equipment suppliers and building code requirements, were used for pre-sizing the buildings structural
members, distributed in each area of the project.
Based on the above, bills of structural steel quantities were prepared and formal quotes for the
structural steel fabrication package were obtained by MCPD. The costs included detailed design, steel
supply and fabrication, painting and delivery.
Piping
Piping take-offs by area were prepared by Tecnomin’s engineering group, based on the P&ID's, piping
plans and piping specifications. The take-offs were sent to MCPD, who packaged the items as required
and obtained formal quotes from reputable materials suppliers.
The technical evaluation and bid selection process was performed by the Project’s engineering group
according to the aforementioned methodology.
Furniture and Fixture
The technical department of MCSA quantified the furniture and fixtures based on the quantity of
personnel and MCPD obtained quotes from suppliers.
September 7, 2017
Electromechanical Installation
Formal quotes for the electromechanical installation were obtained by MCPD from two contractors of
good reputation and national experience.
The inquiries included all the relevant engineering information required for bidding, such as equipment
and materials lists, drawings, specifications, obligation and duties, supplier data and the appropriate
tables of quantities prepared for quoting purposes by the Project technical team.
Taxes
All taxes are based on the current legislation, which defines the rates and the amounts upon which
those rates are to be applied. Taxes were studied on a case by case basis, since the rates can vary
according to the type of goods or services being purchased, their origin and other specifics.
Niether potential tax benefits nor accelerated depreciation were considered for the economic analysis.
The taxation of projects in Brazil occurs as a percentage of income, including 25% for income tax and
9% for social contribution. As the Project is situated in the Amazon region, it is eligible for a taxation
benefit, which could result into a 75% discount on the 25% of income tax for the first ten years of
project.
The Project is subject to specific legislation of Pará State, more specifically those lined out by the
“Superintendência do Desenvolvimento da Amazônia” (SUDAM), such as the reduced income tax
(discount of 75%).
Taxes can generally be described along the following: .
• Foreign Equipment:
o Freights and Customs Duties: These expenses include the cost of transportation from the
origin to Brazilian harbors and the customs duties at these harbors;
o Importation Tax: The Importation Tax on foreign equipment was determined according to
the legislation of the External Tariff Listing (NCM), the taxes are applied to the base value
of the goods at the Brazilian port (FOB price plus freight, insurance and customs duties),
o Industrialized Products Tax (IPI): IPI will be applied at a variable rate in accordance to the
fiscal classification of the item,
o Tax on Circulation of Merchandise and Services Rendered (ICMS): Similar to a VAT tax,
is applied to the base value of the goods plus the other taxes and expenses; ICMS is
calculated at a rate of 4.0%.
o Social Integration Program Tax (PIS): Based in the value of goods with all taxes included;
the PIS is calculated at a rate of 2.10%, and
o Social Security Contribution (COFINS): In the same base of PIS, the COFINS is calculated
at a rate of 10.65%
• National Materials and Equipment:
o ICMS: Taxes varying from 0% to 17% applied to the base value (IPI included). The rate
depends on incentives obtained and the State of origin of the order,
o IPI: 0% to 30% applied to the base value plus ICMS. All equipment receives a fiscal
classification that defines the tax rate,
o PIS: Taxes of 1.65% applied to the base value of the equipment,
o COFINS: Taxes of 7.60% applied to the base value of equipment, and
September 7, 2017
o Special Taxation: Some companies have the “Simples” taxation system, so the product
has only a unique tax, which arise according the vendor, including PIS and COFINS taxes.
• Services and Constructions:
o Service Tax (ISS): This tax is applied on the total invoice of the services or constructions
performed by construction firms. In the Tucumã Municipality the ISS is 5%,
o PIS: Taxes of 0.65% is applied to the base value of service, and
o COFINS: Taxes of 3.0% is applied to the base value of service.
It stands out that benefits taxes credits were considered as an upside in the study, (i.e)
weren't considered in economic analysis.
Benefits taxes considerations are included in Volume XV - Evaluation of Capex - Opex.

Please refer to Volume XV for benefits taxes information.
21.2.3 Direct Costs

21.2.3.1 Pre-Production
Pre-production costs comprises the overburden removal costs (pre-stripping) and all vegetal
suppression (Pit, and waste piles) costs. The results are presented in
Table 21.8 and
Table 21.9.
Table 21.8: Pre-production costs per Area

LoM Cost Ongoing
Item % of Total (R$000’s) Initial (R$000’s) (R$000’s)
Pre-Stripping 95 84,770 84,770 0
Vegetal Suppression 5 4,536 4,536 0
Total 100% R$89,306 R$89,306 0
Table 21.9: Civil Works Pre-production Costs

LoM Cost
Item (R$$000’s)
Civil Works Total R$89,306
21.2.3.2 Infrastructure
These costs are related to the general infrastructure of the project site. Table 21.10 and
Table 21.11 present the estimated investment.
September 7, 2017
Table 21.10: General Infrastructure Cost

Item LoM Cost (R$000’s) Initial (R$000’s)
Total R$6,615 R$6,615
Table 21.11: Access Road Infrastructure Cost

Area LoM Cost (R$000’s)
Total R$6,615
21.2.3.3 Mine
SRK designed productivity models for the mine operations and estimated required operating hours for
the major equipment fleet. These hours were used to estimate number of purchases and replacements
of major and ancillary equipment.
Table 21.12 contains the estimated unitary price for each piece of equipment.
Table 21.12: Unitary Equipment Costs

Equipment Purchase (R$)
Main
Top Hammer Drill - SANDVIK DP i 2,525,865
Back Hoe Hydraulic Excavator - LIEBHERR R964 1,706,730
Front end Loader -LIEBERR L580 866,250
On Highway truck - SCANIA PG440 CB 8X4 (with bucket) 601,650
Bull Dozer - CAT D8T 2,068,501
Motograder - CAT 140K 72,450
Backhoe Loader - CAT 416E-16 241,501
Ancillary
Flatbed Truck -SCANIA440G CB6X4 571,001
Fuel Lube Truck - SCANIA 440G 6X4 535,875
Munk Truck - SCANIA 440G CB 6X4 - 15 tonnes 667,904
Mechanic Field Service - SCANIA P250 DB 4X2 361,362
Water Truck 440 G CB 6X4 473,328
Forklift 69,618
General Service Truck - FORD F-4000 4X4 169,889
Utility Vehicle - GOL TRENDLINE 1.6 50,674
Pick-up HILLUX - SRV 3.0 4X4 144,185
Pick-up - HILUX - STANDARD 3.0 4X4 119,861
Pick-up - STRADA 1.4 50,630
Support Truck - Auto and Plant Shop - VW 13.180 198,450
Replacement costs of Scania trucks and Front End Loader were estimated by SRK based on total
hours required. Table 21.13 present quantities of initial acquisitions and replacements required by
equipment.
September 7, 2017
Table 21.13: New Equipment Purchases and Replacements
Mine Equipment Acquisitions and Replacement - Number of Units per Year

MINE EQUIPMENT Year
Pre-
Main Equipment Production Yr 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7 Yr 8 Yr 9
Top Hammer Drill - Sandvik Dpi 2 - - - - - - - - -
Back Hoe Hydraulic Excavator - Liebherr R964 3 - - - - - - - - -
Front end Loader - Lieberr L580 1 - - - - - - - 1 -
On Highway Truck Scania G440 - 8x4 12 - - - 11 - - 8 - -
Bull Dozer - CAT D8T 3 - - - - - - - - -
Motorgrader - CAT 140K 2 - - - - - - - - -
Backhoe Loader - CAT 416-E 1 - - - - - - - - -
Ancillary Equipment
Flatbed Truck - Scania 440G - 8x4 1 - - - - - - - - -
Fuel Lube Truck - Scania 440G - 6x4 1 - - - - - - - - -
Munk Truck - Scania 440G - 6x4 - 15 t 1 - - - - - - - - -
Water Truck - Scania 440G CB 6x4 2 - - - - - - - - -
Forklift 1 - - - - - - - - -
General Service Truck - Ford F-4000 - 4x4 3 - - - - - - - - -
Utility Vehicle - Gol Trendline 1.6 3 - - - - - - - - -
Hilux - SRV 3.0 4x4 1 - - - - - - - - -
Hilux - Standard 3.0 - 4x4 3 - - - - - - - - -
Pick-up - Strada 1.4 17 - - - - - - - - -
Support Truck - Auto and plant Shop - VW 13.180 3 - - - - - - - - -
Table 21.14 shows the costs per area based on quantities aforementioned in table Table 21.13.
Table 21.14: Mine Costs per Area

LoM Cost Initial Ongoing
Item % of Total (R$000’s) (R$000’s) (R$000’s)
Mine Equipment (Main and Ancillary Equipment) 92 44,223 31,925 12,298
Electrical Equipment (Tower lighting) 0 166.95 167 0
Explosive and Accessories Magazines 8 3,686 3,686 0
Total 100% R$48,075 R$35,778 R$12,298
21.2.3.4 Plant
As described above, the plant capital costs were estimated by Tecnomin and MCSA, Table 21.15 and
Table 21.16 present the results of this investigation.
Table 21.15: Plant Costs per Area

LoM Cost Initial Ongoing
Item % of Total (R$000’s) (R$000’s) (R$000’s)
General 14 34,905 34,905 0
Primary Crushing 6 15,473 15,473 0
Secondary, Tertiary Crushing and Jigging 30 74,223 74,223 0
Grinding & Classification 17 40,626 40,626 0
Flotation 13 32,130 32,130 0
Regrinding 5 11,838 11,838 0
Thickening 5 11,469 11,469 0
Filtering 10 23,445 23,445 0
Total 100% R$244,109 R$244,109 0
September 7, 2017
Table 21.16: Plant Costs per Type

Metallic Structure 6 15,492
Piping 1 2151
Total 100% R$244,109
21.2.3.5 Power & Automation

The project will require the construction of a high voltage transmission line and power infrastructure to
receive and convert the high voltage feed. This cost center also includes any item related to the
automation of the project’s processing facilities. The equipment and services were specified and
quoted by Tecnomin. The results of this quotation are presented in Table 21.17 and
Table 21.18.
Table 21.17: Power & Automation Costs per Area

% of LoM Cost Initial Ongoing
Area Total (R$000’s) (R$000’s) (R$000’s)
General 53 40,862 40,862 0
High Voltage Transmission Line 15 11,274 11,274 0
Main Substation 19 14,219 14,219 0
Substation Crushing & Grinding 8 5,790 5,790 0
Substation Regrind., Flotat. & Filt. 5 3,698 3,698 0
Substation Water Collection 0 255 255 0
Substation Water Recovery 0 255 255 0
Substation Water Build., Lab & Shop 0 352.8 352.8 0
Total 100% R$76,709 R$76,709 0
Table 21.18: Power & Automation Costs per Type

Electrical Equipment 54 41,070
Instruments, Automation & I.T. 3 2082
Civil Works 1 1068
Total 100% R$76,709
21.2.3.6 Utilities System

The project’s utilities system was designed in the basic engineering study developed by Tecnomin.
Tecnomin and MCSA undertook a quotation process to estimate costs of equipment and services. The
results of this investigation are presented in Table 21.19 and
Table 21.20.
September 7, 2017
Table 21.19: Utilities System Costs per Area

Area % of Total LoM Cost (R$000’s) Initial (R$000’s)
General 7 856.8 856.8
Water Collection System 7 850.5 850.5
Water Recirculation System 4 494.55 494.55
Compressed Air System 3 415.8 415.8
Fire Emergency System 2 220.5 220.5
Potable Water System 1 157.5 157.5
Sealing Water System 1 81.9 81.9
Dust Control System 3 349.65 349.65
Reagent Stocking & Prep 72 8,637 8,637
Total 100% R$12,065 R$12,065
Table 21.20: Utilities System Costs per Type

Instruments, Automation & I.T. 6 762
Civil Works 24 2942
Metallic Structure 8 939
Assembling 32 3,919
Piping 1 79
Total 100% R$12,065
21.2.3.7 Administration & Support

Administration & Support infrastructure was designed in the basic engineering study developed by
Tecnomin. Tecnomin and MCSA undertook a quotation process to estimate costs of equipment and
services. The results of this investigation are presented in Table 21.21 and Table 21.22.
Table 21.21: Administration & Support Costs per Area

Area % of Total LoM Cost (R$000’s) Initial (R$000’s)
General 31 7,390 7,390
Entrance Gate 2 538.65 538.65
Clinic & Fire Brigade 1 327.6 327.6
Control Weight Scale 0 12.6 12.6
Admin. Office 6 1360.8 1360.8
Locker Room 2 409.5 409.5
Restaurant 5 1282.05 1282.05
Fueling Station 2 535.5 535.5
Plant Equipment Shop 6 1480.5 1480.5
Warehouse 9 2173.5 2173.5
Residue Hangar 2 422.1 422.1
Lab 17 4,082 4,082
Core Shed 3 746.55 746.55
Auto Shop 10 2327.85 2327.85
Auto Wash 2 472.5 472.5
Total 100% R$23,562 R$23,562
September 7, 2017
Table 21.22: Administration & Support Costs per Type

Furniture 13 3,084
Total 100% R$23,562
21.2.3.8 Tailings Storage Facilities

The Project will require a tailings dam to storage. VOGBR prepared basic design, which was used by
MCSA to quote services and materials required. Most of the material to build the tailings dam will come
from the operation’s pre-stripping. The results of this estimate are presented in Table 21.23 and Table
21.24.
Table 21.23: Tailings Storage Facilities Costs per Area

Area LoM Cost (R$000’s) Initial (R$000’s) Ongoing (R$000’s)
High Sulfur Tailings Dam 45,439 45,439 0
Total R$45,439 R$45,439 R$0
Table 21.24: Tailings Storage Facilities Costs per Type

LoM Cost
Area (R$000’s)
Civil Works 45,439
Total R$45,439
21.2.3.9 Water Pond

The Project will require a water pond to supply fresh water to the plant. VOGBR prepared a conceptual
design, which was used by MCSA to quote services and materials required. Most of the material to
build the water pond will come from the operation’s pre-stripping. The results of this estimate are
presented in Table 21.25.
Table 21.25: Water Pond Costs

Total 100% R$6,398
21.2.4 Indirect Costs

21.2.4.1 Properties Improvements
A lump sum of R$ 630,000.00 was provided to the prior land owner. At the time, thepayment was
required by National Agrarian Department of Brazil ("Instituto Nacional de Colonização e Reforma
Agrária"- INCRA).
September 7, 2017
21.2.4.2 Land Acquisition and Other Services

Dweller Resettlement Program
As a means of complementing the resettlement dwellers program, the National Agrarian Department
of Brazil "Instituto Nacional de Colonização e Reforma Agrária" - (INCRA) requires the purchase of an
area in another local. The estimated cost is R$ 3.61 million. This process is ongoing.
MCSA will not own the titles for the properties within the areas occupied by Boa Esperança Project,
but will have a grant for the use of such lands from INCRA, covering approximately 1,500 ha, with
compensation for families displaced from inside this area.
Access Deviation
To avoid disturbances in nearby communities it's necessary to buy a small land for deviation the
access road from PA - 279 to Boa Esperança Site. The cost is estimated in R$ 84,000.
Boundary Fence - Site
To provide safety conditions for workers and nearby communities is required to building a boundary
fence on site limits. The cost is estimated at R$ 317,000.
21.2.4.3 Owner Operated Pre-Production Labor

Owner operated personnel are necessary before initial production ore (pre-production). Own team
costs are composed by labor, meals, employees’ transportation, uniforms, rentals (offices, vehicles,
electric generator, containers, etc.). Own team are necessary to support pre-production phase and
supervise contracts and constructions. Main contracts and services comprises the overburden removal
(pre-stripping), vegetal suppression and erection plant phase. The estimated costs are R$ 14,277,177
21.2.4.4 Engineering Services, Management and Other services

Detailed Engineering Design
Detailed Engineering Design was quoted by several consulting firms and a lump sum of R$ 4,367,830
was obtained.
Management
Project technical team prepared a detailed EPCM organizational chart, which was used to develop a
monthly labor estimate in man-hours and headcount for all EPCM disciplines, for the entire Project
duration. Man-hour rates were then applied to the labor estimate to obtain a cost for the implementation
period of the project which is estimated to be 26 months.
The man-hour rates contemplated local and foreign labor at the following professional levels:
• Manager / Supervisor;
• Engineer;
• Designer / Draughtsman; and
• Administrative labor.
September 7, 2017
The adopted rates reflect the current market. The manpower rates include base salary, social security
charges according to the legislation, overhead charges, dislocation expenses, general office
expenses, computer hardware and software and taxes. It also includes assumed office general
expenses and furniture, besides computer hardware and software.
Management total costs was quoted at R$ 9,214,824 including expenses and all taxes.
Supply, Inspection and Diligence
Inspection/diligence services for mechanical equipment, Quality Control services at the site for the
installation of main mechanical equipment were quoted by MCSA’s team. An amount of R$ 3,359,105
was obtained.
Commissioning
After the plant installation and prior to start-up, the commissioning amount R$ 566,971.
21.2.4.5 Start-up Expenses

These costs are related to the first fill of balls mill, reagents and lubricants necessaries for the start-up
of the plant. The amount is R$ 3,055,325.
21.2.4.6 Freight
To cover the expenses for transportation of equipment and materials from vendors to the site, an
assumption of 1.6% of the value of Initial CAPEX. This percentage is in accordance with MCSA’s
experience and amount R$ 9,867,813.
21.2.4.7 Financial Compensation

The environmental compensation for the installation permission was calculated by Environment
Secretary of Pará State - (Secretaria de Estado de Medio Ambiente e Sustentabilidade - SEMAS).
This lump sum is R$ 4,961,942.
21.2.4.8 Spare Parts

A percentage was applied to the price of the equipment (mechanical, electric and instrumentation),
materials, piping, metallic structure, boiler, vehicles and mine equipment, with all taxes included. The
percentage used, based on the experience of the owner’s technical team, is 0.6%. To the value
obtained was added the taxes normally used in equipment acquisition. The lump sum obtained was
R$ 3,339,570 and then included in indirect costs.
21.2.4.9 Insurance
The engineering risk insurance was valued by Colemont Insurance according to the Project Capital
costs with contingency. The lump sum is R$ 2,087,066.
September 7, 2017
21.2.5 Closure & Salvage

Mine Closure was prepared by SRK. The estimate comprises an environmental recovery plan after
mining activities. Summarized costs are presented in Table 21.26.
Table 21.26: Closure Costs
CLOSURE Total (R$)

RESCISSION LABOR COSTS
- Notification Costs 3,097,419
- Guarantee Fund for time on Job (FGTS) 6,881,029
ENVIRONMENTAL RECOVERY
Environmental Recovery - Open Pit 315,679
Environmental Recovery - Tailings Dam 619,393
Environmental Recovery - Waste Pile 322,340
Environmental Recovery - Saprolite Pile 476,221
DEMOLITION - PLANT
Demolition - Plant 998,910
DISASSEMBLY
Mobilization, Maintenance worksite and
2,269,759
Demobilization
Mechanical Equipment Disassembly 6,711,992
Electrical Equipment Disassembly 6,412,043
Piping Disassembly 3,629,976
Boiler Disassembly 3,740,188
Metallic Structure Disassembly 4,422,512
TOTAL R$ 39,897,460
Salvage value was also included in the cash flow model as a result of sale of main mechanical and
electrical equipment, electric cables, mine equipment and ancillary equipment at the end mining
activities. Structural steel, boiler, piping and secondary mechanical equipment were also considered
as scrap for sale. The results are presented in Table 21.27.
Table 21.27: Salvage
SALVAGE Total (R$)

MECHANICAL EQUIPMENT - SALVAGE
Mechanical Equipment 13,234,694
Electric Cables 289,008
SCRAP
Mechanical Equipment 115,572
Piping 32,690
Metallic Structure 135,253
September 7, 2017
Boiler 62,259
MINE EQUIPMENTS - SALVAGE
Main Mine Equipment 8,079,296
Ancillary Mine Equipment 499,333
Spare Parts 2,347,893
TOTAL R$ 24,796,000
21.2.6 Contingency
Contingency is a sum of money included in the capital cost estimate to ensure a probability of not
exceeding the estimated capital expenditure. The Contingency amount is added to the capital estimate
considering the level of the information and the detail of the basic design. The accuracy range reflects
both the uncertainties in scope definition, (i.e. quantities) and the uncertainties in pricing.
Table 21.28 shows the criteria used in the contingency estimations.
Table 21.28: Criteria Used in Contingency Estimations

Contingency Class Percentage
Undertaken 0
Formal Proposal 3
Formal Quotation 5
Informal Quotation 10
Database, estimate, etc. 20
Each item that compose the CAPEX – equipment, materials, services - were classified according to
the level of the risk and then the corresponding rate were applied on the value, with all tax included
and then the individual contingency was obtained. This criterion was used in both direct and indirect
costs. The contingencies represent the 7,73% of initial Capital Costs.
21.3 Operating Cost Estimates

21.3.1 Basis for Operating Costs Estimate
Operating costs are based on mine, process, tailings and infrastructure facility design criteria,
engineering, as well as budgetary and vendor quotes. All operating costs include supervision staff,
operations labor, maintenance labor, consumables, electricity, fuels, lubricants, maintenance parts
and any other operating expenditure identified by contributing engineers.
Table 21.29: Project Operating Costs per Area

Mining 15.69 561.27 305,774
Processing 19.28 689.72 375,741
G&A 9.54 341.59 186,086
Total R$44.48 R$1,592.58 R$867,598
September 7, 2017
Table 21.30: Project Operating Costs by Element

LoM
R$/t-RoM R$/t-Conc
Item (R$000’s)
Electric Power 8.10 289.93 157,938
Fuel (Diesel) 3.28 117.62 64,074
Labor: Mine and Plant 9.86 353.08 192,345
Consumables/Wear Parts / Others 9.20 329.11 179,285
Spare Parts 4.50 161.28 87,869
G&A (included G&A Labor) 9.54 341.59 186,086
Total R$44.48 R$1,592.58 R$867,598
The Sections below present the detailed breakdown of the project operating costs.
21.3.2 Mine
SRK designed productivity models for the mine operations and estimated required operating hours for
all the main equipment fleet. These hours were used to estimate operating costs of main and ancillary
equipment. SRK also estimated quantities of explosives and accessories required for the drill and blast
operation and the required labor to manage, operate and maintain the mine equipment.
Results of this estimate are presented in the Table 21.31.
Table 21.31: Mine Operating Costs

Diesel 3.28 117.62 64,074
Lube 0.50 17.64 9,611
Blasting 2.90 103.26 56,259
Drilling 0.03 0.50 274.05
Tires 0.38 14.02 7,636
Spare Parts and others Wear Parts 3.02 108.64 59,192
Other Operating Costs 0.63 22.11 12,058
Mine Labor 4.95 177.44 96,667
Total R$15.69 R$561.27 R$305,774
21.3.2.1 Diesel
Main equipment operating costs were estimated through the considered equipment operating hours.
Table 21.32 presents the adopted consumption rates for each of main equipment. Table 21.33
presents the annual diesel consumption for the mine main equipment and ancillary equipment.
Table 21.32: Equipment Consumption Rates

Mine Equipment Reference Model Fuel Consumption (L/h)
Top Hammer Drill Sandvik DP 1100i 32.0
Backhoe Hydraulic Excavator Liebherr R964 47.5
On Highway Truck Scania G440 CB 8X4 16.0
Bulldozer Caterpillar D8T 38.7
Motograder Caterpillar 140K 17.0
Front end Loader Liebherr L580 23.4
Backhoe Loader Caterpillar 416E 10.4
Water Truck Scania 440G CB6x4 9.3
Mechanic Field Service Truck Scania P250 DB4x2 9.3
Fuel/Lube Truck Scania 440G CB6x4 9.3
Flatbed Truck Scania 440G CB6x4 9.3
Munk Truck Scania 440G CB6x4 12.7
September 7, 2017
Service Vehicle Toyota Hilux 6.0

Portable Lightning Tower AtlasCopco QLT M 20 2.0
Forklift Heli CP CD25 15.0
Table 21.33: Main Equipment and Ancillary Equipment - Annual and LoM Consumption -
Diesel
Diesel Consumption (L x 10³)
Year
Equipment TOTAL
Yr 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7 Yr 8 Yr 9
Top
Hammer 254 248 287 243 279 326 201 1,838
- -
Drill
Backhoe
Hydraulic 621 609 610 581 605 598 358 3,982
- -
Excavator
On Highway
1,013 1,042 1,055 1,083 1,026 882 714 229 136 7,181
Truck
Bulldozer 606 561 562 583 591 574 499 217 217 4,408
Motor grade 213 217 244 244 244 244 244 108 108 1,864
Front end
66 64 62 83 65 61 106 189 137 832
Loader
Ancillary
411 411 411 411 411 411 411 68 68 3,011
Equipment
Total 3,184 3,150 3,230 3,226 3,220 3,096 2,532 811 666 23,115
The diesel cost of R$ 2.77 per liter was based on quotation provided by a local supplier (BR
Distribuidora) after accounting for discounted pricing often available for large industrial users. Table
21.34 presents the annual and life of mine (LoM) diesel costs.
September 7, 2017
Table 21.34: Diesel - Annual and Life of Mine (LoM) Costs
R$/t- R$/t-
Annual Costs and Total Costs - Diesel (R$ 000's)
ROM conc
Year Yr 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7 Yr 8 Yr 9 LoM
Diesel 8,826 8,732 8,952 8,943 8,927 8,584 7,018 2249.1 1845.9 64,074 3.28 117.62
21.3.2.2 Lube
The lube consumption was estimated by SRK. Table 21.35 presents the annual and life of mine (LoM)
lube costs.
Table 21.35: Lube - Annual and Life of Mine (LoM) Costs
Annual Costs and Total Costs - Lube (R$ 000's) R$/t- R$/t-
ROM conc
Lube 1,323 1,310 1,342 1,342 1,339 1,288 1,052 337.05 277.2 9,611 0.50 17.64
21.3.2.3 Blasting
Supply, storage, handling and charging of explosives into the holes will be responsibility of a
specialized outsourced company, which will operate through a service contract. Table 21.36 shows
the explosives and accessories unitary prices.
Table 21.36: Explosive and Accessories - Unit Costs

Explosives and Accessories Prices
Type (R$)
Blended (R$/t) 2390.00
Booster(R$/unit) 22.90
Delay (R$/unit) 10.58
Detonating Cord (R$/m) 0.82
Non Electric Detonator (R$/unit) 1.13
The explosives will be hauled in ANFO loader trucks, which load the holes with blended explosive
(30% with ANFO - Ammonium Nitrate Fuel Oil, and 70% with emulsion). The blasting design plans
were done for each rock type and with unitary costs was calculated the total costs with blasting. Table
21.37 shows annual and life of mine (LoM) costs with explosives and accessories.
September 7, 2017
Table 21.37: Explosive and Accessories - Annual and Life of Mine (LoM) Costs
Explosives and Accessories Cost (R$ x 1,000) - Annual
Explosives Accessories
Non
Year Detonatin Total Freight Services Total
Ore Waste Total Booster Delay Electric
g Cord Accessories
Detonator
Yr 1 1910.16 1674.54 3,585.02 242.55 37.49 294.21 0.32 574.56 1157.63 2678.45 7,995.33
Yr 2 2421.72 981.23 3,403.26 230.27 35.60 279.09 0.32 545.27 1099.04 2678.45 7,726.01
Yr 3 2661.12 1254.65 3,916.08 265.23 40.95 321.30 0.32 627.48 1264.73 2678.45 8,486.73
Yr 4 1958.04 1371.20 3,328.92 225.23 34.65 273.11 0.32 533.61 1075.10 2678.45 7,616.07
Yr 5 2188.31 1664.78 3,853.08 260.82 40.32 316.26 0.32 617.40 1244.25 2678.45 8,393.18
Yr 6 2703.02 1768.10 4,470.80 302.72 46.62 366.98 0.32 716.63 1443.96 2678.45 9,309.83
Yr 7 1909.22 823.73 2732.94 184.91 28.35 224.28 0.32 437.85 882.63 2678.45 6,732.18
Yr 8 - - - - - - - - - - -
Yr 9 - - - - - - - - - - -
Total 15,751.58 9,538.52 25,290.09 1712.025 263.655 2074.905 2.52 4,053.11 8,167.32 18,748.80 56,259.32
21.3.2.4 Drilling
Bits and rod bit consumption were estimated by SRK through of the total material to be blasted. The
unit costs were obtained through database built by SRK. Table 21.38 shows annual and life of mine
(LoM) costs with drilling materials.
Table 21.38: Drilling Materials - Annual and Life of Mine (LoM) Costs
R$/t- R$/t-
Annual Costs and Total Costs - Drilling Materials - Bits and Bit Rods (R$ 000's)
ROM conc
Year Yr 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7 Yr 8 Yr 9 Total
Bits and Bit
37.8 37.8 44.1 37.8 41.0 47.3 31.5 - - 274.1 0.01 0.50
rods
21.3.2.5 Tires
Tires consumption was estimated by SRK based in total fleet hours. Tires costs was also estimated
by SRK. Table 21.39 presents the annual and Life of Mine (LoM) costs with tires.
Table 21.39: Tires - Annual and Life of Mine (LoM) Costs
Annual Costs and Total Costs - Tires (R$ 000's) R$/t- R$/t-
ROM conc
Tires 1041.1 1059.7 1077.6 1094.3 1060.0 972.7 870.7 258.6 202.5 7636.86 0.38 14.02
21.3.2.6 Spare Parts and Other Wear Parts

Operating costs with spare parts were estimated based on the average hourly costs provided by
equipment dealers for severe working conditions. Table 21.40 shows the annual and life of mine (LoM)
costs with spare parts and others wear parts beyond the wear parts mentioned above (tires and drilling
materials).
September 7, 2017
Table 21.40: Spare Parts and Other Wear Parts - Annual and Life of Mine (LoM) Costs
Annual Costs and Total Cost - Spare Parts and Other Wear Parts
Year Yr 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7 Yr 8 Yr 9 TOTAL
R$ x 1,000 6,382 6,845 3,263 8,429 9,869 9,085 5,663 1,352 1,283 59,192
21.3.2.7 Other Operating Costs

Other mine operating costs were classified into the following categories:
Support Equipment
Comprises operating costs with mobile radios, repeaters, GPS surveying equipment, software (mine
planning, geology and topography) and dispatch (truck allocation system);
Offices
Comprises costs with office supplies for mine area;
Infrastructure Maintenance
Comprises costs with mine workshop, maintenance mine buildings and roads;
Mine Quality Control
Costs of laboratory analysis were estimated based on the assumption of a unit cost of R$ 14.55 per
drillhole and on the assumption that 100% of the ore and 30% of waste materials will be sampled. An
average of approximately 9,200 analyses with a peak of 1,300 laboratory analyses per year is
estimated for grade control of mining activities.
Reclamation
Comprises costs with reclamation of waste pile, pit, dam and other mine infrastructure.
Pit Dewatering
Costs with pit dewatering were estimated based in database built by SRK. It includes all costs
associated with the pumping system, including removing water from sump in the bottom pit, outside
the pit area and for the storage reservoir.
Table 21.41 shows costs above year by year and total costs during the life of mine.
September 7, 2017
Table 21.41: Spare Parts and Other Wear Parts - Annual and Life of Mine (LoM) Costs
Other Operating Costs - Annual Costs and Total Costs (R$ x 1,000)
Mine Quality
88.2 111.5 122.5 90.4 100.8 124.7 87.9 - - 726.1
Control
Pit
- - - 261.5 305.6 333.9 378.0 - - 1278.9
Dewatering
Maintenance
Software and 152.1 152.1 152.1 152.1 152.1 152.1 152.1 60.8 60.8 1,185.3
Hardware
Truck
allocating 25.2 25.2 25.2 25.2 25.2 25.2 25.2 - - 176.4
System
Support Equipment
Mobile
12.6 12.6 12.6 12.6 12.6 12.6 12.6 - - 88.2
Radios
GPS
Surveying 9.5 9.5 9.5 9.5 9.5 9.5 9.5 - - 66.2
Equipment
Hardware 37.8 37.8 37.8 37.8 37.8 37.8 37.8 37.8 37.8 340.2
Office
56.7 56.7 56.7 56.7 56.7 56.7 56.7 56.7 56.7 510.3
Supplies
Infrastructure Maintenance
Mine
384.3 384.3 384.3 384.3 384.3 384.3 384.3 104.0 104.0 2,857.1
Workshop
Mine
66.2 66.2 66.2 66.2 66.2 66.2 66.2 25.2 6.3 494.6
Buildings
Roads 472.5 472.5 472.5 472.5 472.5 472.5 472.5 239.4 126.0 3,672.9
Reclamation - - - 110.3 110.3 110.3 110.3 110.3 110.3 661.5
Total 1304.7 1328.4 1339.4 1678.6 1733.4 1785.4 1793.0 634.1 460.8 12,057.6
21.3.2.8 Mine Labor

According to the production schedule, SRK estimated the total workforce necessary for the mining
activities. Table 21.42 shows mine work force necessary per year divided per main areas (Mine and
geology, Mine operation and Mine equipment maintenance).
September 7, 2017
Table 21.42: Mine workforce per year and During the Life of Mine
Mine Workforce
Year
AREA Yr 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7 Yr 8 Yr 9
Mine and Geology 8 8 8 8 8 8 8 7 7
Mine Operation 178 178 178 178 178 178 160 125 125
Mine Equipment
51 51 51 51 51 51 51 40 40
maintenance
TOTAL (People) 237 237 237 237 237 237 219 172 172
Manager, administrative workers and some technicians will work on one shift only (day shift).
Equipment operators will work on two or one shift, depending on the type of equipment. Mine labor
costs are shown below according to Table 21.43.
September 7, 2017
Table 21.43: Mine Labor - Annual and Life of Mine (LoM) Costs
Annual Costs and Total Costs (LoM) - Mine Labor (RS$ x 1,000)
Year
Labor Costs - Mine
Yr 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7 Yr 8 Yr 9
Mine and geology 1,342 1,342 1,342 1,342 1,342 1,342 1,342 1,194 1,194
Mine Manager 350 350 350 350 350 350 350 350 350
Coordinator 621 621 621 621 621 621 621 621 621
Geologist 148 148 148 148 148 148 148 - -
Surveyor 139 139 139 139 139 139 139 139 139
Draftsman 44 44 44 44 44 44 44 44 44
Admin Assistant 41 41 41 41 41 41 41 41 41
Mine Operation 8,288 8,288 8,288 8,288 8,288 8,288 7,380 5,796 5,796
Mining Technician 271 271 271 271 271 271 271 110 110
Blaster 47 47 47 47 47 47 47 - -
Helper 265 265 265 265 265 265 265 189 189
Job Safety Technician 151 151 151 151 151 151 151 76 76
Shift Supervisor 410 410 410 410 410 410 410 410 410
Drill Operator 403 403 403 403 403 403 403 - -
Excavator Operator 605 605 605 605 605 605 504 - -
Truck Operator 2,416 2,416 2,416 2,416 2,416 2,416 1,610 1,610 1,610
FEL Operator 403 403 403 403 403 403 403 605 605
Bulldozer Operator 605 605 605 605 605 605 605 403 403
Motograder Operator 403 403 403 403 403 403 403 403 403
Water Truck Operator 403 403 403 403 403 403 403 403 403
Fuel Truck Operator 202 202 202 202 202 202 202 202 202
Multi-function Operator 403 403 403 403 403 403 403 403 403
Assistant 699 699 699 699 699 699 699 583 583
Replacement Operator 605 605 605 605 605 605 605 403 403
Mine Equipment
1,884 1,884 1,884 1,884 1,884 1,884 1,884 1,512 1,512
Maintenance
Coordinator 208 208 208 208 208 208 208 208 208
Maintenance
110 110 110 110 110 110 110 110 110
Technician
Admin Assistant 41 41 41 41 41 41 41 41 41
Equipment Washer 57 57 57 57 57 57 57 38 38
Lubeman 117 117 117 117 117 117 117 88 88
Tire Repairman 88 88 88 88 88 88 88 66 66
Mechanic 158 158 158 158 158 158 158 126 126
Maintenance Helper 227 227 227 227 227 227 227 189 189
Welder 95 95 95 95 95 95 95 63 63
Vehicle Electrician 142 142 142 142 142 142 142 95 95
Equipment Operator 32 32 32 32 32 32 32 32 32
Vehicle Mechanic 387 387 387 387 387 387 387 290 290
Vehicle Electrician 221 221 221 221 221 221 221 167 167
TOTAL - by year 11,510 11,510 11,510 11,510 11,510 11,510 10,603 8,499 8,499
TOTAL – LoM 96,667
September 7, 2017
21.3.3 Plant
Plant operating costs were calculated by Tecnomin. Costs were modeled as consumptions rates for
each plant operation.
Results of this estimate are presented in Table 21.44 and Table 21.45.
Table 21.44: Plant Operating Costs by Area
ITEM R$/t-
R$/t-RoM conc LoM (R$ x1,000)
Crushing and Jigging 2.90 103.60 56,448
Grinding and Screening 5.01 179.05 97,537
Flotation 2.33 83.76 45,621
Regrinding 0.22 8.28 4,520
Thickening 0.25 9.29 5,059
Cooper Content. Filtration 0.19 7.06 3,849
Tailing Filtration 0.85 30.27 16,487
Recovery Water System 0.16 5.86 3,185
Raw Water System 0.03 1.13 621
Compressed Air System 1.07 38.81 21,146
Potable Water System 0.03 1.67 907
Sealing Water System 0.03 1.51 816
Fire Fighting System 0.00 0.22 129
Dust Control System 0.00 0.09 47
Reagents Preparation 0.09 2.99 1,638
Lighting and Others 1.13 40.45 22,044
Labor 4.91 175.64 95,681
TOTAL R$19.28 R$689.72 R$375,741
Table 21.45: Plant Operating Costs by Element

Item LoM (R$000’s) R$/t-RoM R$/t-conc
Electric Power 157,938 8.10 289.93
Reagents 31,487 1.61 18,35
Wear Parts 61,957 3.18 36,11
Spare Parts 28,678 1.48 16,71
Plant Labor 95,681 1,56 55,76
Total R$375,741 R$19.28 R$689.72
21.3.3.1 Plant Electric Power

Basic engineering project determined the required power for all equipment, which was used to
calculate the total power demand and energy consumption of Boa Esperança Project. Table 21.46
shows the power consumption rates per year and specific costs that were estimated for each
operation.
September 7, 2017
Table 21.46: Plant Electric Power Consumption

Item kWh/year R$ / t-ROM
Crushing and Jigging 10,982,173.76 1.35
Grinding and Screening 21,820,213.41 2.71
Flotation 7,007,897.05 0.88
Re-Grinding 1,150,034.66 0.16
Thickening 482,507.57 0.06
Cooper content Filtration 931,216.30 0.13
Tailing Filtration 2,877,912.94 0.35
Recovery Water System 1,261,109.39 0.16
Raw Water System 228.954.27 0.03
Compressed Air System 8,681,873.00 1.07
Potable Water System 140,474.16 0.03
Sealing Water System 320,506.24 0.03
Fire Fighting System 21,671.99 0.00
Dust Control System 19,342.68 0.00
Reagent Prep 300,460.02 0.03
Operational Support 9,119,160.00 1.13
Total 65,345,507.44 R$8.10
Table 21.47 shows annual and life of mine (LoM) costs with electric power.
Table 21.47: Plant Electric Power - Annual and Life of mine (LoM) Cost
Electric Power Costs - Annual Costs and LoM Cost
LoM R$/t- R$/t-
Year
Yr 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7 Yr 8 Yr 9 (000's) RoM conc
(R$ x 1,000) 12,619 18,692 18,692 18,692 18,692 18,692 18,692 18,692 14,468 157,938 8.10 289.93
21.3.3.2 Reagents
Costs with reagents are specifically related to the following:
• Lime;
• Sulfuric Acid;
• DTF collector;
• PAX collector;
• FLOMIN - F-810 frother;
• Concentrate flocculants;
• Tailings flocculants;
• Reagents for Water Treatment
Consumption rates were based on bench scale metallurgical tests performed by SGS Geosol between
2011 and 2014. Table 21.48 shows considered consumption rates.
September 7, 2017
Table 21.48: Reagents Calculated Consumption Rates

Item Consumption (g/t-feed to mill)
Sulfuric Acid 500
Lime 700
Flomin - F810 (frother) 20
DTF collector 30
PAX Collector 50
Concentrate Flocculants 20
Tailings Flocculants 25
Based on potable water consumption Tecnomin estimated a cost with water treatment in R$ 50,000
(US$ 15,873) per year.
Each reagent and freight were quoted by MCPD. Table 21.49 shows annual and life of mine (LoM)
costs with reagents.
Table 21.49: Annual and Life of mine (LoM) Cost - Reagents

Total Cost (R$ x 1,000)
R$/t-RoM R$/t-conc
Sulfuric Acid 794 1,175 1,175 1,175 1,175 1,175 1,175 1,175 910 9,935 0.50 18.24
Lime 375 558 558 558 558 558 558 558 432 4,703 0.25 8.63
Flomin - F810 (frother) 189 280 280 280 280 280 280 280 217 2,378 0.13 4.38
DTF Collector 309 460 460 460 460 460 460 460 356 3,881 0.19 7.12
PAX Collector 539 797 797 797 797 797 797 797 617 6,728 0.35 12.35
Concentrate Flocculants 13 22 22 22 22 22 22 22 16 176 0.00 0.32
Tailings Flocculants 258 384 384 384 384 384 384 384 296 3,235 0.16 5.95
Potable Water Reagent 50 50 50 50 50 50 50 50 50 450 0.03 0.82
Total 2,529 3,723 3,723 3,723 3,723 3,723 3,723 3,723 2,892 31,487 1.61 57.80
21.3.3.3 Wear Parts
21.3.3.3.1 Grinding Bodies
Grinding Bodies specific consumption was obtained based on MCSA Matrix database. Table 21.50
shows the considered consumptions.
Table 21.50: Grinding Bodies - Annual Consumption

Grinding Bodies Consumption Annual Consumption
Item Unit (kg/t - feed to mill) tonnes/year of balls
Ball Mill 0.238 356.4
Vertical Mill 0.200 30.6
Table 21.51 shows annual and life of mine (LoM) grinding bodies costs.
September 7, 2017
Table 21.51: Grinding Bodies - Annual and Life of Mine (LoM) Costs
Grinding Bodies - Annual Costs and LoM Cost (R$ x 1,000)
R$/t-RoM R$/t-conc
Ball Mill 1,440 2,136 2,136 2,136 2,136 2,136 2,136 2,136 1,654 18,037 0.91 33.11
Vertical Mill 110 164 164 164 164 164 164 164 126 1,389 0.06 2.55
Total 1,553 2,300 2,300 2,300 2,300 2,300 2,300 2,300 1,780 19,426 1.01 35.66
21.3.3.3.2 Linings
Specific consumption of linings for the primary crusher, secondary crusher, tertiary crushers, ball mill
and vertical mill was obtained based on MCSA Matrix database. Table 21.52 shows the specific
consumptions for the items mentioned above.
Table 21.52: Annual Consumption - Linings - Crushing and Grinding

Primary Crusher (Jaw Crusher)
Consumption
ITEM Qty
(Sets/year)
Jaw Crusher Lining Sets 4 1
Jaw Crusher Lining Sets - movable 4 1
Jaw Crusher Exterior Lining Sets 4 1
Jaw Crusher Interior Lining Sets 4 1
Secondary Crusher (cone crusher)
Consumption
ITEM Qty
(Sets/year)
Exterior Liner Set 5 1
Interior Liner Set 9 1
Tertiary Crusher (cone crusher)
Consumption
ITEM Qty
(Sets/year)
Exterior Liner Set 5 2
Interior Liner Set 9 2
Ball Mill
Consumption
ITEM Qty
(Sets/year)
Feeder lining 1.6 1
Discharge lining 1.5 1
Mill Lining 1 1
Regrinding
Consumption
ITEM Qty.
(Sets/year)
Regrinding lining 1 1
Based on specific consumptions above, Table 21.53 shows annual and life of mine (LoM) linings costs.
September 7, 2017
Table 21.53: Lining - Annual and Life of Mine (LoM) Costs
Annual costs and Total cost - Linings (R$ x 1,000)

Year Yr 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7 Yr 8 Yr 9 LoM R$/t-RoM R$/t-conc
Wear
Parts - 1,947 2,885 2,885 2,885 2,885 2,885 2,885 2,885 2,233 24,384 1.26 44.76
Linings
21.3.3.3.3 Screens and Filter Lining
Specific consumption of screens and filter linings was obtained based on MCSA Matrix database.
Table 21.54 shows annual and life of mine (LoM) costs with screens and filter linings.
Table 21.54: Screens and Filter Linings - Annual and Life of Mine (LoM) Costs
Annual costs and Total cost - Screens and Filter Linings (R$ x 1,000)
Year Yr 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7 Yr 8 Yr 9 LoM R$/t-RoM R$/t-conc
Screens
and
1,449 2,148 2,148 2,148 2,148 2,148 2,148 2,148 1,663 18,147 0.91 33.33
Filter
Linings
21.3.3.4 Spare Parts

Spare parts costs were estimated by Tecnomin. Table 21.55 shows annual and life of mine (LoM)
costs with spare parts, mainly conveyor belts and rolls, pumps rotors, transmission belts, plates, bins,
hoses (hydraulic and general), piping, transmission and others mechanical motor parts, electric motor
parts, etc.
Table 21.55: Spare Parts - Annual and Life of Mine (LoM) Costs
Annual costs and Total cost - Spare Parts (R$ x 1,000)
R$/t- R$/t-
Year LoM
Yr 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7 Yr 8 Yr 9 RoM conc
Spare
2,290 3,393 3,393 3,393 3,393 3,393 3,393 3,393 2,627 28,678 1.48 16.71
Parts
21.3.3.5 Potential Acid Drainage

The project will probably be subject to formation of acid drainage, mostly related to the ore stockpiles
and waste dumps. A detailed study regarding the treatment of this acid material has not been
conducted. This study not comprises costs with acid drainage.
21.3.3.6 Plant Labor

All labor is considered to be salaried, with no extra hours considered in the model. Production labor
will work three shifts of eight hours per day. Four teams will cover the daily shifts with three teams
working while the fourth rests. Table 21.56 shows the annual labor costs.
September 7, 2017
Table 21.56: Plant Administrative Labor

Annual Salary
Professional People
(R$)
Plant Administrative Labor
Processing Manager 1 350,534
Coordinator 3 621,974
Mine Technician 3 163,312
Chemical Technician 1 51,551
Administrative Assistant 2 79,664
Scaling Operator 1 39,832
Laboratory auxiliary 4 81,019
Operation auxiliary 4 75,987
Plant Production Labor
Safety technician 2 167,183
Shift Supervisor 4 450,848
Crushing Operator 8 402,561
Grinding Operator 4 201,281
Flotation Operator 8 402,561
Filtration Operator 8 402,561
Filtration Auxiliary 32 1,029,143
Wheel loader operator 4 201,281
Reagents Operator 2 79,664
Panel Operator 16 805,122
General Operator 8 402,561
Chemical Analyst 4 287,201
Laboratory Auxiliary 8 248,819
Plant Maintenance Labor
Maintenance Technician 3 163,312
Lathe Operator 2 79,664
Mechanic 14 463,937
Welders 6 198,830
Lubricator 2 58,060
Maintenance Auxiliary 14 265,956
Expert Electrician 7 469,116
Industrial Electrician 5 234,838
Network Technician 1 51,551
Instrument Specialist 6 309,307
September 7, 2017
Mechanics (Shift) 8 407,087

Welders (Shift) 4 203,543
Maintenance Auxiliary (Shift) 0 0
Industrial Electrician (Shift) 8 523,329
Auxiliary (Maintenance Vacation) 4 203,543
TOTAL 214 R$ 10,631,216
21.3.4 G&A
G&A costs were estimated on yearly budgets provided by MCSA. Additionally, MCSA provided labor
for project administration and major maintenance of the mineral processing plant. Table 21.56 presents
the resulting G&A costs.
Table 21.57: Project G&A Costs

Item LoM (R$000’s) R$/t-RoM R$/t-conc
Administrative Labor 58,105 2.99 97.21
Employees Transportation 16,805 0.85 30.84
Meals 17,363 0.88 31.88
Safety Equipment and Uniforms 2853.9 0.16 5.23
Medical Assistance 29,887 1.54 54.87
Life Insurance 538.65 0.03 0.98
Trip Expenses 2929.5 0.16 5.39
Telephony, Hard Copies, Internet Connection and Post Office 4,111 0.22 7.56
General Services (Security and Cleaning Services) 30.15495 1.54 55.35
Safety and Environment 2699.55 0.13 4.95
I.T Maintenance 7,314 0.38 13.42
House Rental 4,914 0.25 9.01
Legal and Audits Support 4,152 0.22 7.62
Other Costs 4,256 0.22 7.81
Total R$186,086 R$9.54 R$341.59
All costs above include all own employees (i.e.), mine, plant and G&A area.
21.3.4.1 G&A Labor

G&A labor has is based on salaried employees, no extra hours are considered in the model. G&A
labor also will work straight day shifts of eight hours per day. Table 21.58 shows the annual G&A labor
costs.
September 7, 2017
Table 21.58: Labor Costs - G&A

Annual Salary
Professional People
(R$)
G&A Administration
General Manager 1 512,670
Area Manager 4 1,402,138
Coordinator 5 1,036,624
Senior Engineer (Black Belt) 1 174,942
Senior Geologist 1 174,942
Junior Geologist 1 137,305
Public Relations 1 79,048
Designer 1 57,159
Safety Technician 1 54,437
Geology Technician 1 54,437
Environmental Technician 1 54,437
Administrative Assistant II 22 1,028,686
Administrative Assistant I 5 199,161
Nurse Helper 1 31,560
Stockman II 1 43,802
Checker 2 63,121
Scale Operator 0 0
Stockman Auxiliary 6 119,680
Stockman (Shift) 4 141,478
Stockman Auxiliary (Shift) 8 178,830
Vacation Coverer (Shift) 4 141,478
G&A Sustaining
Engineer 2 295,630
Model Technician 3 163,312
Designer 1 57,159
TOTAL 79 R$ 6,456,120
September 7, 2017
22 Economic Analysis
22.1.1 Principal Assumptions
A financial model was prepared on an unleveraged, post-tax basis. Its bases and results are presented
in this section. Key criteria used in this analysis are summarized in Table 22.1.
September 7, 2017
Table 22.1: Model Parameters

Parameter Value Unit
Pre-Production Period 26 months
Mine Life 7.5 years
Post Production Period 1.5 years
Cu Price (Production Period) 6,614 US$/t-Cu
Cu Deduction & Losses 1.2 %
TC 78.5 US$/t-Concentrate
RC 7.85 US$ cents/lb-Cu
Truck to Port Storage 175.01 R$/t-Concentrate
Handling & Storage (Port) - Bulk (50% of concentrate) 67.57 R$/t-Concentrate
Ocean to Shanghai - Bulk (50% of concentrate) 236.25 R$/t-Concentrate
Handling & Storage (Port) - Container (50% of concentrate) 124.39 R$/t-Concentrate
Ocean to Shanghai - Container (50% of concentrate) 132.30 R$/t-Concentrate
CFEM Royalty (% of (NSR - (Truck + Ocean))) 2.0 %
Depreciation Period 9.0 years
Discount Rate (by year) 8.0 %
Income Tax Rate 15.7 %
A 26 month pre-production period allows for permitting, detailed engineering, due diligence/financing
and pre-production mine development, facilities construction and infrastructure development. The
mining will last 7.5 years, while the project will produce copper for sale over a 9.0 year period, through
the feeding of stockpiled material over a 1.5 year period.
The analysis assumes prices for 30% copper concentrate. Adopted price curve was performed by
MCSA, based on results of CRU market study. Prices are in 2017 dollar terms. NSR is calculated
based on Cu deductions and losses and TC/RC charges
Taxation of projects in Brazil occurs as a percentage of income, including 25% for income tax and 9%
for social contribution. As the project is situated in the Amazon region, it is eligible for a taxation benefit,
which could result into a 75% discount on the 25% of income tax for the first ten years of project. This
benefit is considered in the project evaluation, resulting in an effective income tax rate of 15.7%
The project discount rate is assumed at 8%.
22.1.2 Indicative Economics

The financial analysis results, shown on Table 22.2, indicate an after-tax net present value (NPV) for
the project at an 8% discount rate of US$ 195.3 million with an IRR of 32.7%. Payback from project
start is 3.6 years.
September 7, 2017
Table 22.2: Economic Results

Item Unit or Factor Value
Ore Mined kt 19,500.3
Mined Cu (contained) kt 185.0
Recovered Cu kt 163.4
Payable Cu kt 156.9
Sales Volumes, Prices and Delivery Costs
Cu Price (average over production period) US$/t-Cu 6,614
Treatment Charges US$/t conc. 78.50
Refining Charges US ¢/lb 7.85
Tonnes Cu sold kt 156.9
Revenue
Gross Revenue R$000’s 3,943,195
Logistics & Sales Costs R$000’s (333,113)
CFEM Royalty R$000’s (63,104)
Gross Income R$000’s 3,546,942
TC / RCs R$000’s (454,875)
Net Revenue R$000’s 3,488,320
Operating Costs
Mining R$000’s (305,774)
Process R$000’s (375,741)
G&A R$000’s (186,086)
Total Operating Costs R$000’s (867,600)
Project Capital (Equity) R$000’s (626,126)
Financing Interest R$000’s
Income & Social Contribution Taxes R$000’s (251,907)
Operating Cash Flow R$000’s 1,972,596
Initial Capital R$000’s 599,719
Equity for funding R$000’s
Share Holders Equity R$000’s 599,719
Ongoing Capital R$000’s 12,298
Free Cash Flow R$000’s 1,345,477

After-tax NPV 8% (per annum) U$000’s 195,295
IRR 32.7%
Payback Yrs. 3.6
22.1.3 Cashflow Forecasts and Annual Production Forecasts

Table 22.3 shows annual production and cash flow forecasts for the life of the project.
September 7, 2017
Table 22.3: Annual Cash flow and Production Forecast
September 7, 2017
22.1.4 Taxes, Royalties and Other Interests

Income tax is calculated at 15.25% of operating margin less depreciation after accounting for the 75%
taxation benefit reduction to the 25% income tax rate available to the Amazon region, and the
additional 9% social contribution.
Mining Royalty: A mining royalty is owed from the date of commencement of effective exploitation. The
mining royalty is calculated on the value of sales realized, less transport costs. The rate of the mining
royalty is 2% for copper.
Withholding Tax on Salaries: The holder is liable to pay the standard withholding tax on salaries
payable to the employees. This has been built into wages across the Project.
22.1.5 Sensitivity Analysis

A sensitivity analysis for key operating and economic parameters is shown in Table 22.4 to
Table 22.6. The project is most sensitive to copper price. Because the change in NPV is greatest with
copper price change, it is this parameter that most significantly affects the economics of the project.
Copper prices fluctuation around -20% and + 20% can cause variations of about US$ 122 million in
NPV. CAPEX and OPEX fluctuation around -20% and +20% can cause variations of about US$ 32
million and US$ 28 million in NPV, respectively.
Table 22.4: Project Sensitivity to Copper Price
Base
Units -30% -20% -10% +10% +20% +30%
Case
IRR - % Year 9.1% 18.0% 25.8% 32.7% 39.1% 45.0% 50.5%
NPV - US$'000 11,117 72,510 133,902 195,295 256,687 318,080 379,472
Table 22.5: Project Sensitivity to Initial Capital Costs
Base
Units -30% -20% -10% +10% +20% +30%
Case
IRR - % Year 47.9% 41.9% 36.9% 32.7% 29.1% 26.0% 23.2%
NPV - US$'000 243,399 227,364 211,329 195,295 179,260 163,225 147,191
Table 22.6: Project Sensitivity to Operating Costs
Base
Units -30% -20% -10% +10% +20% +30%
Case
IRR - % Year 36.9% 35.5% 34.1% 32.7% 31.3% 29.8% 28.2%
NPV - US$'000 237,644 223,527 209,411 195,295 181,179 167,062 152,946
September 7, 2017
Figure 22-1: Sensitivity Analysis - IRR
Figure 22-2: Sensitivity Analysis: NPV
22.2 Conclusions & Recommendations

Reader is cautioned that the economic evaluation does not include tax benefits value on capital and
operating costs. These benefits should be considered as an upside. In addition, accelerated
depreciation has not been considered in this study. However, a reduction on the income tax was
considered.
September 7, 2017
It should be noted that the tax benefits contemplated are related to those that are generally approved
for projects focused on exportation and situated in the Amazon region. The project may also enjoy
specific legislation of Pará State, more specifically those lined out by the “Superintendência do
Desenvolvimento da Amazônia” (SUDAM), such as the reduced income tax (discount of 75%).
Recommendations are described below:
• Perform a detailed review of all tax benefits including those that may potentially be used in
conjunction with MCSA’s Curaçá Valley Operations prior to decision to install project;
• Investment and operating costs related to the acid drainage treatment should be investigated;
• After the Effecitve Date of this report, Brazilian legislation that rules over mineral royalties
changed. Although not expected to be material, a review of any potential impacts on the
Project should be evaluated;
• “Significant part of the CAPEX of Boa Esperança project, as well as operating expenses, are
represented by services and materials whose prices are denominated in R$ (reais). Thus,
currency devaluations can lead to significant decreases in the amount of CAPEX considered
and in the total of operational expenses, resulting in higher profitability of the Project.
September 7, 2017
23 Adjacent Properties
The information contained in this report is based solely on the Boa Esperança Project.
September 7, 2017
24 Other Relevant Data and Information

There is no other relevant data available regarding the Boa Esperança Project.
September 7, 2017
25 Interpretation and Conclusions

Geology
The Boa Esperança deposit is comprised of as silica- and sulfide-filled breccias containing copper and
cobalt mineralization associated with magnetite, as a variant of an IOCG hydrothermal deposit type.
SRK concludes that the mineralization has been sufficiently defined through exploration methods,
including core drilling, to support the Mineral Resource and Mineral Reserve estimation.
Exploration
The exploration methods used at Boa Esperança are acceptable and follow industry standard practices
of mapping, surveying, core drilling, sampling and assaying. They are sufficient for generating a
database of drillhole information and assays to support Mineral Resource estimation.
Mineral Resource Estimate
The Mineral Resource estimation was conducted by SRK using grade shells and OK. The grade shells
used follow the general outline prepared by MCSA in previous studies. The density values were
assigned based on copper and iron content. The Mineral Resource estimation has been prepared
according to CIM guidelines.
Mineral Reserve Estimate
The Mineral Reserve estimation was calculated based on a cut-off grade of 0.28% Cu and a life of
mine (LoM) copper price of US$ 7,000/t LME Cu.
Table 25.1 shows the Boa Esperança mine open pit ore reserve statement.
Table 25.1: Mineral Reserve Statement for the Boa Esperança copper deposit, State of Para,
Mineral
Contained
Reserve Volume Density Dry Tonnes Cu
Cu
Classification
m3 x 1,000 t/m3 t x 1,000 % t x 1,000
Proven 5,744.50 3.225 18,528.1 0.96 178.05
Probable 315.6 3.089 975.0 0.72 7.02
Total 6,060.10 3.218 19,503.1 0.95 185.07
• Open pit Mineral Reserves assume full mine recovery;
• Open pit Mineral Reserves are diluted along lithological boundaries and assume selective mining unit of 2.5 m x 2.5
m x 5 m;
• The strip ratio was calculated to be 1.93 (waste to ore);
• Reserves are based on a price of US$ 7,000/t LME Cu throughout the life of the mine;
• Reserves are based on a cut-off grade of 0.28% Cu;
• Mineral Resource tonnage and contained metal have been rounded to reflect the accuracy of the estimate. As a result
of this rounding, the numbers may not add up;
• Contained copper is reported as in-situ and does not include process recovery; and
• The Mineral Reserve estimate was calculated by Rubens Mendonça, BSc, MBA, Chartered Professional Member of
the AusIMM, Mining Manager of SRK Consultores do Brasil, in accordance with the standards set out in CSA, NI 43-
101 and generally accepted CIM “Estimation of Mineral Resource and Mineral Reserves Best Practices” guidelines.
September 7, 2017
Geotechnical
Steeper angles are proposed for the excavated slopes in the weathered and fresh rocks. However, for
the saprolite, a new smoother slope is being proposed, as this material forms a less cohesive soil. The
bench faces required slaughtered slopes (45°), though it is possible to acquire more accurate
resistance values in relation to shearing, and in doing so, perhaps improve the proposed angle.
Mineral Processing and Metallurgical Testing
• Jigging in an AllMineral jig (a Baum-type pneumatic jig) has proven effective. Therefore, more
sophisticated techniques, such as separation in dense media, or specialized equipment such
as jigs with artificial beds or for special use, are unnecessary.
• 30% of the crushing product is under 3 mm and shows copper enrichment between 1.55 and
2.0 as compared to the ROM copper grade. The coarse fraction which feeds the jig has copper
grade between 0.75 and 0.8 of the ROM grade.
• Despite this fraction has not been pre-concentrated to the moment, it must be considered in
an eventual future testing campaign.
• 50% of the mass is rejected in jigging. The copper recovery varies from 86 to 96%. Adding to
this recovery the recovery of the copper contained in the finer fraction (-3 mm) of the crushed
product, the total recovery of the circuit will go up to 90-96%.
• The crushing/flotation circuit is fed with pre-concentrate, to which the finer fraction (-3 mm) of
the crushed product is added.
Processing and Basic Engineering
• The process plant (concentrator) has been designed based on an extensive laboratory testing
program conducted on master composites and variability composites over a range of ore
grades.
• ROM mineralogy allows the using of pre-concentration methods. Jigging was the chosen
method and was extensively tested.
• The jigging and flotation use standard and proven processes that have been demonstrated to
work in the laboratory testing program.
• The concentrator has been designed to process 376.4 t/h of ore on the crushing and 184.1 t/h
on the grinding.
• Equipment sizing and selection has emphasized flexibility of operation.
• Concentrate thickener sizing was based on laboratory tests and on vendor recommendations.
The tailing thickener was estimated based on vendor recommendations and on previous
laboratory tests once after the tests results others equipment were added before the thickener
to optimize the process (cyclone and dewatering screen), resulting on changes in the particle
size and on the solids rate of the thickener’s feed.
• Concentrate filter sizing was based on vendor recommendations and on Caraíba’s previous
experience in Pilar. The tailing filter size was based on vendor recommendation and previous
September 7, 2017
experience once the laboratory test was made for a vacuum belt filter and, to improve the
process, a press filter replaced the vacuum filter belt.
• A project package including: Process Flow Diagrams, General Arrangement Drawings,
preliminary Piping and Instrumentation Drawings, preliminary Electrical Drawings, data
sheets, etc., has been created to allow cost estimation to the desired accuracy.
Tailings
The studies and dimensioning executed in the basic design of the B2 Dam and the Conceptual Design
of the Water Pond were developed according to the criteria and premises defined at the start of the
design development. together with MCSA.
The volumes of the materials constituting the embankments, excavations, treatments and drainage
and transition systems of the dams were estimated within the accuracy made possible according to
the data available at this phase of the design.
Logistics
Considering:
• The impossibility of usage of the Tocantins River because of the existent stones and lack of
investment, and;
• The difficulties to access the Carajás railroad system, which is owned by VALE and
administrated VLI;
The only viable export option is via the port of Vila do Conde, accessed by truck. The situation may
change in the future in the event the Tocantins River and/or Carajás Railroad suffer significantly
evolutions.
Environmental Management and Permitting
MCSA has its environmental compliance based in authorizations and licenses issued by federal and
state governmental Agencies.
The environmental studies and researches demonstrate important factors such as, e.g. the difficulty
to define a Legal Reserve in an ecosystem such as the one in the Amazon Region. This added to
great relevance questions as the use of water resources and assessment of potential acid rock
drainage. Also, several studies are here presented characterizing the social-environmental relation
with other enterprise influence areas.
Related aspects of environmental mitigation and compensation were defined as by the law at all
permitting entities.
Capital and Operating Costs
The economic evaluation in this Report does not include the value of any potential benefits for taxes
on capital and operating costs. These potential benefits should be considered as an upside along with
any shared tax benefits that may be utilized in conjunction with MCSA’s Curaçá Valley operations.
September 7, 2017
Also, accelerated depreciation was not considered in this study. However, a reduction on the income
tax was considered as part of the expected tax programs offered to the Amazon region.
It should be noted that the tax benefits contemplated are related to those that are generally approved
for projects focused on exportation and situated in the Amazon region. The project may also enjoy
specific legislation of Pará State, more specifically those lined out by the “Superintendência do
Desenvolvimento da Amazônia” (SUDAM), such as the reduced income tax (discount of 75%), which
has been considered in the economic evaluation of this Report.
Conclusion
SRK has carried out the appropriate review work to satisfy itself that the Mineral Reserve can be
technically and profitably extracted through to the production and sale of copper concentrate.
Consideration has been given to all technical areas of study, the associated capital and operating
costs, and relevant factors including marketing, permitting, environmental and social. SRK is satisfied
that the technical and economic feasibility has been demonstrated.
The Mineral Resource and Mineral Reserve Estimates are compliant within the guidelines of NI 43-
101 and SRK has not identified any mining, metallurgical, infrastructure, permitting, legal, political,
environmental, technical, or other relevant factors that could materially affect the potential
development of estimated Mineral Reserves and Mineral Resources.
September 7, 2017
26 Recommendations
Exploration
SRK recommends the following be completed as additional QA/QC procedures, to provide increased
confidence in the database:
• Document analytical procedures used by the SGS Geosol and Intertek laboratories for all
elements analyzed at Boa Esperança;
• Document procedures for down-hole surveys;
• Document all QA/QC procedures;
• Conduct core duplicate sampling of ¼ cores to compare with initial ¼ core, for examination of
sampling variability;
• Document SRM origin and certification, as well as blank certification;
• Send approximately 2% of all sample pulps, across a wide range of assays, to a second
independent commercial analytical lab for comparative analysis against SGS assays (all
elements).
The costs of the recommended work programs are given below:
• Documentation of analytical procedures, down-hole surveys and SRMs should be conducted

by staff geologists and would incur no additional cost;
• Checking assays at a secondary lab would cost around US$20 per sample. The cost for 250
samples would be around US$6,000, including labor and shipping;
• Duplicate core samples would cost around US$20 per sample and around US$7,000 in labor
costs, including cutting the samples, shipping and analysis.
Processing and Basic Engineering
The following recommendations should be considered during the detail design phase of the project
before final equipment selection is finalized:
• Tailings thickener sizing should be confirmed based on the actual characteristics of the
material once equipment considering the installation of equipment before the thickener
(cyclone and derrick dewatering screen) to optimize the process resulting on changes in the
particle size and on the solids rate of the thickener feed.
• Tailings filter sizing should be confirmed once the laboratory test was made for a vacuum belt
filter and, to improve the process, a press filter replaced the vacuum filter belt.
Environmental Management and Permitting
• Communication with all stakeholders should be an on-going activity within the Boa Esperança
Project.
• The project’s Social-Environmental management should be pragmatically undertaken and
continuously reviewed and improved.
• Acid drainage studies should be expanded to ensure that the sample is representative of the
entire project.
• Development of a conceptual geochemical model of the project area should be conducted.
September 7, 2017
• The legal reserve must be set for environmental compliance purposes.

• The day-to-day follow-up of the environmental licensing and its conditions at all levels must
be carefully completed.
Capital and Operating Costs

• Perform a detailed review of all tax benefits including those that may potentially be used in
conjunction with MCSA’s Curaçá Valley Operations prior to decision to install the Project;
• After the Effecitve Date of this report, Brazilian legislation that rules over mineral royalties
changed. Although not expected to be material, a review of any potential impacts on the
Project should be evaluatedA significant part of the CAPEX of Boa Esperança project, as well
as operating expenses, are represented by services and materials whose prices are
denominated in R$ (reais). Thus, currency devaluations can lead to significant decreases in
the amount of CAPEX considered and in the total of operational expenses, resulting in higher
profitability of the Project.
Table 26.1: Proposed Budget for Recommended Work
Budget
Program (US$)
Check assays at secondary laboratory $6,000
Duplicate core samples, including cutting, shipping & analysis 12,000
Confirm tailings thickener design and filter sizing 40,000
Expand studies on acid rock drainage and treatment 32,000
Develop a conceptual geomechanical model 30,000
Total $120,000
September 7, 2017
Execution Date: September 7, 2017
<signed & sealed in the original>
Carlos César Barbosa, MAusIMM
Rubens José de Mendonça, MAusIMM
Giorgio di Tomi, CEng MIMM
September 7, 2017
I, Carlos César Barbosa, MAusIMM, as author for the revision and compilation of the technical
report entitled “Feasibility Study Technical Report for the Boa Esperança Copper Project; Pará
State, Brazil”, dated September 7, 2017, with an effective date of June 1, 2017 (the “Technical
Report”), prepared for Ero Copper Corp. (“Issuer”), do hereby certify that:
1) I am currently employed as a Principal Consultant of SRK Consultores do Brasil Ltda. (“SRK”),
with offices at Rua Santa Rita Durao #74, Belo Horizonte, Minas Gerais State, Brazil
2) I graduated with a Bachelor of Science degree in Geological Engineering from Universidade
Federal de Ouro Preto in 1985.
3) I am a Geologist enrolled with the Australasian Institute of Mining and Metallurgy (Member
#308352) and a Chartered Professional (CP) since 2012.
4) I have worked in operational and management positions in the mining industry, with a variety of
mineral commodities at different worldwide locations. My professional experience includes
geological modeling, resource evaluations, database management, short term mine planning,
control opening drifts in underground mines and quality control. From 2012 to date, I have
worked as report co-ordinator for many conceptual, prefeasibility and feasibility reports
worldwide and have authored or contributed as a “qualified person” to technical reports under
National Instrument 43-101 – Standards of Disclosure for Mineral Projects (“NI 43-101”) and
numerous reports under the Australian Code for Reporting of Exploration Results, Mineral
Resources and Mineral Reserves.
5) I have read the definition of “qualified person” set out in NI 43-101 and certify that, by reason of
my education, affiliation with a professional association as defined in NI 43-101, and past
relevant work experience, I fulfill the requirements to be a “qualified person” for the purposes of
NI 43-101.
6) I am responsible for Chapters 4, 5, 6, 7, 8, 9, 10, 11, 12 and 14 and am responsible for sections
of Chapters 1, 25 and 26 pertaining to the foregoing Chapters of the Technical Report.
7) My previous involvement with Mineração Caraíba S.A. (“MCSA”) includes working for SRK as
technical coordinator and project management for the Boa Esperanҫa Feasibility Study prepared
in 2015.
8) I personally inspected the MCSA properties that are the subject of the Technical Report in a visit
with three days’ duration in August 2015.
9) As of the effective date of the Technical Report, to the best of my knowledge, information, and
belief, the Technical Report contains all scientific and technical information that is required to be
disclosed to make the Technical Report not misleading.
10) I have no personal knowledge, as of the date of the Technical Report, of any material fact or
material change which is not reflected in the Technical Report.
11) I am independent of the Issuer, applying all the tests in section 1.5 of NI 43-101.
12) I have read NI 43-101 and Form 43-101F1 – Technical Report, and the Technical Report has
been prepared in compliance with such instrument and form.
Belo Horizonte, Brazil, September 7, 2017
Carlos César Barbosa, MAusIMM
September 7, 2017
I, Rubens Jose de Mendonca, MAuslMM, CP (Mine), as author for the revision and compilation of
the technical report entitled "Feasibility Study Technical Report for the Boa Esperarnça Project,
Para State, Brazil ", dated September 7, 2017, with an effective date of June 1, 2017 (the
"Technical Report"), prepared for Ero Copper Corp. ("Issuer"), do hereby certify that:
1) I am currently employed as a Principal Consultant and Mining Manager of SRK Consultores do
Brasil Ltda. ("SRK"), with offices at Rua Santa Rita Durao 74, Belo Horizonte, Minas Gerais
State, Brazil.
2) I graduated with a Bachelor of Science degree in Mining Engineering from Escola de Engenharia
of Universidade Federal de Minas Gerais in 1980.
3) I am a Professional Engineer enrolled with the Australasian Institute of Mining and Metallurgy
(Member# 228607) since 2007 and a Chartered Professional (CP) since 2015.
4) I have worked in operational and management positions in the mining industry, with a variety of
mineral commodities at different worldwide locations. My professional experience includes mine
planning and operation, operational improvements and consulting, with solid knowledge of the
Brazilian and Chilean mining industries, including legal, social and environmental aspects. I have
also exercised managerial functions at open pit mines and consultant companies. Since 1980, I
have continually been involved in mining operations, projects and consulting services for copper,
gold, base and ferrous metals in Brazil, Chile, Sierra Leone, Saudi Arabia and Peru. From 2006
to date, I have worked as report co-ordinator for many conceptual, prefeasibility and feasibility
reports worldwide and have authored or contributed as a "qualified person" to five technical
reports under NI 43-101 and numerous reports under the Australian Code for Reporting of
Exploration Results, Mineral Resources and Mineral Reserves.
5) I have read the definition of "qualified person" set out in National Instrument 43-101 -Standards
of Disclosure for Mineral Projects ("NI 43-101 ") and certify that, by reason of my education,
affiliation with a professional association as defined in NI 43-101, and past relevant work
experience, I fulfill the requirements to be a "qualified person" for the purposes of NI 43-101.
6) I am responsible for Chapters 2, 3, 15, 16, 18, 19, 20, 21, 22, 23, 24, 27 and for sections of
Chapters 1, 25 and 26 pertaining to the foregoing Chapters of this Technical Report.
7) I had no previous involvement with Mineração Carafba S.A. ("MCSA").
8) I personally inspected the MCSA properties that are the subject of this Technical Report in visits
with two days' duration in August 2015.
belief, the Technical Report contains all scientific and technical information that is required to be
disclosed to make the Technical Report not misleading.
10) I have no personal knowledge, as of the date of this Technical Report, of any material fact or
material change which is not reflected in this Technical Report.
12) 1I have read NI 43-101 and Form 43-101F1 -Technical Report, and the Technical Report has
been prepared in compliance with such instrument and form.
Rubens José de Mendonça, MAusIMM
September 7, 2017
I, Giorgio de Tomi, CEng MIMM as author for the revision and compilation of the technical report
entitled “Feasibility Study Technical Report for the Boa Esperança Copper Project; Pará State,
Brazil”, dated September 7, 2017, with an effective date of June 1, 2017 (the “Technical Report”),
prepared for Ero Copper Corp. (“Issuer”), do hereby certify that:
13) I am currently a mining engineering consultant associated with DT Engenharia, which is located
on Rua Corgie Assad Abdalla, Sao Paulo, Brazil.
14) I graduated with a degree in Mining Engineer from the University of São Paulo, Brazil in 1983. I
obtained a PhD in 1995 degree from the Imperial College, UK and an MSc degree in 1989 from
Southern Illinois University, USA.
15) I am a Professional Member of the Institute of the Institute of Materials, Minerals & Mining (UK)
with membership No. 461723. I am a Chartered Engineer with the Engineering Council of the
UK. I am a Member of the Society for Society for Mining, Metallurgy, and Exploration in the USA
with membership no. 793700.
16) I have 33 years’ relevant experience working as a mining engineer and consultant to the mining
industry.
17) I have read the definition of “qualified person” set out in National Instrument 43-101 – Standards
of Disclosure for Mineral Projects (“NI 43-101”) and certify that, by reason of my education,
affiliation with a professional association as defined in NI 43-101, and past relevant work
experience, I fulfill the requirements to be a “qualified person” for the purposes of NI 43 101.
18) I am responsible for Chapter 13 and Chapter 17 and am responsible for sections of Chapter 1,
25 and 26 pertaining to the foregoing Chapters of the Technical Report.
19) My previous involvement with Mineração Caraíba S.A. (“MCSA”) includes working for SRK
Consultores do Brasil Ltda. (“SRK”) as a mining engineering consultant for the Boa Esperanҫa
Feasibility Study prepared in 2015.
20) I personally inspected the MCSA properties that are the subject of the Technical Report in a visit
with three days’ duration in March 2015.
belief, the sections of the Technical Report that I have authored and am responsible for contains
all scientific and technical information that is required to be disclosed to make the Technical
Report not misleading.
22) I have no personal knowledge, as of the date of this certificate, of any material fact or material
change which is not reflected in the Technical Report.
24) I have read NI 43-101 and Form 43-101F1 – Technical Report, and the Technical Report has
been prepared in compliance with that instrument and form.
Giorgio di Tomi, CEng MIMM
September 7, 2017
27 References
AB’SABER, A. A Universidade brasileira na (re)cosntrução da Educação ambiental. Educação
brasileira, Brasília, v.15, n.31, p.107-115, jul./dez. 1993.
ABNT - Brazilian Association for Technical Standards. (2015). NBR 14031; Environmental
management - Environmental performance evaluation – Guidelines. Rio de Janeiro, 44p.
Ab'SABER, A.N. 1967. Domínios morfoclimáticos e províncias fitogeográficas do Brasil.
AMIRA, 2002. ARD Test Handbook. Project P387A Prediction & Kinetic Control of Acid Mine Drainage.
AMIRA international May 2002.
AZEVEDO-RAMOS, C. & U. GALATTI. 2002. Patterns of Amphibian Diversity in Brazilian Amazonia:

conservation implications. Biological Conservation, n. 103, p.103-111.
Bieniawski, Z.T., Engineering Rock Mass Classifications, John Wiley & Sons, New York, 1989.
BRAZIL (2002). Ministry of the Environment. . Available in <http:/mma.gov.br/>.
BRAZIL. (1967) Law # 5.371/67, Establishes the National Indian Foundation – FUNAI, responsible for
the administration of indigenous heritage and work to integrate the Indians into the national community.
Brasília, DF: Official Journal Publication [of] Federative Republic of Brazil, 1967.
BRAZIL. (1967). Law # 227/67, Mining code. Brasília, DF: Official Journal Publication [of] Federative
Republic of Brazil, 1967.
BRAZIL. (1973)Law # 6.001/73, Establishes the Indian Statute within the legal framework of Brazil's
indigenous policy, until the promulgation of the Constitution of 1988. Brasília, DF: Official Journal
Publication [of] Federative Republic of Brazil, 1973.
BRAZIL. (1988). Federal Constitution. Brasília, DF: Federative Republic of Brazil, 1988.
BRAZIL. (1997). Law # 9.433/97, National Policy of Water Resourses. Brasília, DF: Official Journal
September 7, 2017
BRAZIL. (1998). Law # 9.605/98, Provides for penal and administrative sanctions resulting from
conduct and activities detrimental to the environment, and other matters. Brasília, D F: Official Journal
BRAZIL. (1999). Law # 9.795/1999. Provides for environmental education, establishing the National
Environmental Education Policy. Brasília, DF: Official Journal Publication [of] Federative Republic of
Brazil, 1999.
BRAZIL. (2000). Law # 6.938/81 Brazilian National Environmental Policy. Brasília, DF: Official Journal
BRAZIL. (2000). Law # 9.985/00, introduces the System of Conservation Units and determines
environmental compensation standards. Brasília, DF: Official Journal Publication [of] Federative
BRAZIL. (2002). Decree # 4281/2002. Regulates Law in 9795, of April 27, 1999, establishing the
National Environmental Education Policy, and other measures. Brasília, DF: Official Journal
BRAZIL. (2004). Decree # 5.051/04. Promulgates Convention 169 of the International Labor
Organization – (OIT) Indigenous and Tribal Peoples. Brasília, DF: Official Journal Publication [of]
Federative Republic of Brazil, 2004.
BRAZIL. (2004). Ordinance Ministry of Health # 518/04. Establishes the procedures and
responsibilities relating to the control and surveillance of water quality for human consumption and its
potability standards, and other measures. Brasília, DF: Official Journal Publication [of] Federative
BRAZIL. (2009). Decree # 6.848 /09. Adds provisions to Decree # 4340 of August 22, 2002, to regulate
environmental compensation. Brasília, DF: Official Journal Publication [of] Federative Republic of
Brazil, 2009.
BRAZIL. (2010). Law # 12.305/10, National Policy of Solid Waste. Brasília, DF: Official Journal
BRAZIL. (2011). Ordinance Inter-ministerial # 419/11. Regulates the activities of the agencies and
entities of the Federal Public Administration involved in environmental licensing, deck in art. 14 of Law
September 7, 2017
# 11,516, of August 28, 2007. Brasília, DF: Official Journal Publication [of] Federative Republic of
Brazil, 2011.
BRAZIL. (2011). Supplementary law # 140/11, Sets standards for cooperation between the Union, the
States, the Federal District and the municipalities in administrative actions resulting from the exercise
of common responsibility for the protection of remarkable natural landscapes, protecting the
environment, combating pollution in any of its forms and the preservation of forests, fauna and flora.
Brasília, DF: Official Journal Publication [of] Federative Republic of Brazil, 2011.
BRAZIL. (2012). Decree # 7.747 /12, Established the National Policy for Territorial and Environmental
Management of Indigenous Lands – PNGATI. Brasília, DF: Official Journal Publication [of] Federative
BRAZIL. (2012). Law # 12.651/12, Forest Code Decree, Provides for the protection of native
vegetation. Brasília, DF: Official Journal Publication [of] Federative Republic of Brazil, 2012.
C. Steinweg Handelsveem (Latin America) S. A., March 2015. Boa Esperança Project – Copper
Concentrate – Logistic Sdudy. 56p.
Coffey Mining, July 17, 2009. Mineral Resource Estimation, Boa Esperança Copper deposit for
Mineração Caraíba S.A., 91 pages.
Coffey Mining, July 17, 2009; Mineral Resource Estimation, Boa Esperança Copper deposit, for
Mineração Caraiba S/A, 91 pages.
CONAMA – National Council for Environment. (1986). Resolution # 01/86, Deals with the general
guidelines for the use and implementation of Environmental Impact Assessment. Brasília, DF: Diário
Oficial [da] Republica Federativa do Brasil, 1986.
CONAMA – National Council for Environment. (1986). Resolution # 01/86, Provides the basic criteria
and guidelines for environmental impact assessment. Brasília, DF: Diário Oficial [da] Republica
Federativa do Brasil, 1986.
CONAMA – National Council for Environment. (1997). Resolution # 237/97, Provisionsdes for
environmental licensing; competence of the Union States and Municipalities; list of activities subject to
licensing; Environmental Studies, Environmental Impact Assessment and Environmental Impact
Report. Brasília, DF: Diário Oficial [da] Republica Federativa do Brasil, 1997.
September 7, 2017
CONAMA – National Council for Environment. (2005). Resolution # 357/05, Provides for the
classification of water bodies and environmental guidelines within its framework and establishes the
conditions and standards of effluent discharge, and other measures. Brasília, DF: Diário Oficial [da]
Republica Federativa do Brasil, 2005.
CONAMA – National Council for Environment. (2008). Resolution # 396/08, Provides for the
classification and environmental guidelines of groundwater. Brasília, DF: Diário Oficial [da] Republica
CONAMA – National Council for Environment. (2010). Resolution # 422/10, Establishes guidelines for
campaigns, actions and environmental education projects. Brasília, DF: Diário Oficial [da] Republica
CONAMA, Conselho Nacional do Meio Ambiente, Resolução n. 237, de 19 de dezembro de 1997.

Regulamenta os aspectos de licenciamento ambiental estabelecidos na Política Nacional do Meio
Ambiente.
Consensum Engenharia, 2015. Economic Analysis. Boa Esperança Copper Project. November. 59p.
CRU, 2015. Copper Market Outlook. February. 84p.
Metal Data, Estudo de Pré-viabilidade Econômica. Projeto Cobre Boa Esperança. Setembro, 2009.
242p.
Diemme Filtration R&D, August 10, 2012 , “Relatorio Nr. LAB 312113 – Rev 2.
DNPM – Departament of Mineral Production. (2001). Regulatory standard mining # 20 (NRM-20),

Ordinance # 237/2001. Brasília, DF: Diário Oficial [da] Republica Federativa do Brasil, 2001.
DNPM – Departament of Mineral Production. (2006). Ordinance # 199/2006, Establishes the forms
and documents necessary to grant prior approval and registration of the assignment and the transfer
of mineral rights contracts. Brasília, DF: Diário Oficial [da] Republica Federativa do Brasil, 2006.
DNPM – Departament of Mineral Production. (2006). Ordinance # 199/2006, Establishes the forms
and documents necessary to grant prior approval and registration of the assignment and transfer of
mineral rights contracts. Brasília, DF: Diário Oficial [da] Republica Federativa do Brasil, 2006.
September 7, 2017
DNPM – National Departament of Mineral Production. (2014). Application for exploitation, Process #
855.815/1996. Superintendência/PA.
Ducke, A. & Black, G.A. (1954). Nota sobre a fitogeografia da Amazônia brasileira. Bol. Téc. Inst.
Agron. do Norte, 29:3-48.
EQUATOR PRINCIPLES ASSOCIATION, The Equator Principles, June 2013, 24 p.
Escola Politécnica da Universidade de São Paulo – Departamneto de Engenharia de Minas, June,

2015. Boa Esperança Project – Pre Concentration and Processing Report. 37p.
Fookes, P.G. (1997). Tropical Residual Soils. The Geological Society London.
Global Seismic Hazard Assessment Program (GSHAP), 1999, D. Giardini, G. Grünthal, K. Shedlock,
and P. Zhang.
GOVERNO DO ESTADO DO PARÁ, Available at <http://www.pa.gov.br/O_Para/opara.asp>.
Gumede, H., Stacey, T.R., Measurement of typical joint characteristics in South African gold mines
and the use of these characteristics in the prediction of rock falls, The Journal of The South African
Institute of Mining and Metallurgy, Vol. 107, pp. 335-344, May 2007
HADDAD, C. F. B. 1998. Biodiversidade de anfíbios no estado de São Paulo. In: JOLY, C. A.;
BICUDO, C. E. de M. (Orgs). Biodiversidade do estado de São Paulo: síntese do conhecimento ao
final do século XX. v. 6 - vertebrados. São Paulo: Fapesp. p.15-26.
HIDROWEB – ANA. Sistema de Informações Hidrológicas. Available at <http://hidroweb.ana.gov.br/>.

Access Jan/2015.
Hoek E., Brown E.T., Practical Estimates of Rock Mass Strength. International Journal of Rock
Mechanics and Mining Sciences & Geomechanics Abstracts, 1997:34 (8):1165-1186.
Hoek E., Carranza-Torres CT, Corkum B., Hoek-Brown Failure Criterion – 2002 Edition. In:
Proceedings of the Fifth International North American Rock Mechanics Symposium, Toronto, Canada,
Vol. 1, 2002. p. 267-273.
September 7, 2017
Hoek E., Diederichs M.S. Empirical Estimation of Rock Mass Modulus, International Journal of Rock
Mechanics and Mining Sciences, 2006:43(2):203-215.
Hoek E., Strength of jointed rock masses. Twenty-third Rankine Lecture, Geotechnique, 1983:23
(3):187-223.
INCRA – National Institute of Colonization and Agrarian Reform. Available at

<http://www.incra.gov.br> .
INSTITUTO BRASILEIRO DE MEIO AMBIENTE – IBAMA (Brasil). Instruction # 4/2011 Establishes

procedures for the preparation of the Degraded Area Recovery Project - PRAD. Diário Oficial [da]
República Federativa do Brasil, Brasília, 14 abr. 2011. Seção 1, p. 100 – 101.
INSTITUTO BRASILEIRO DO MEIO AMBIENTE E DOS RECURSOS NATURAIS RENOVÁVEIS -

IBAMA (Brasil) - Manual recovery of degraded areas by mining: revegetation techniques. Brasília:
IBAMA, 1990. 96p.
INTERNATIONAL FINANCE CORPORATION, Performance Standards on Social & Environmental

Sustainability - Guidance Notes. January, 2012. 273 p.
International Society for Rock Mechanics Commission on Standardization of Laboratory and Field
Tests, Suggested Methods for the Quantitative Descriptions of Discontinuities in Rock Masses,
International Journal of Rock Mechanics, Mining Sciences and Geomechanics Abstracts, Vol. 15,
1978. P. 319-368.
International Society for Rock Mechanics Commission on Testing, Suggested Method for Determining
Point Load Strength, International Journal of Rock Mechanics and Mining Sciences, Vol. 22, No. 2,
1985. p. 52-60.
Iron oxide copper gold ore deposits (2013, July 16). In Wikipedia, The Free Encyclopedia. Retrieved
4:28pm, July 1st , 2015, from:
http://en.wikipedia.org/w/index.php?title=Iron_oxide_copper_gold_ore_deposits&oldid=564513610.
Jaeger, J.C. Friction of rocks and stability of rock slopes. Geotechnique, 1971: v.21, n.2, 97-103.
September 7, 2017
KEYSTONE, Estudo de Impacto Ambiental. Projeto Boa Esperança. 2008. SRK Consulting (U.S.),
Inc. Technical Report – Boa Esperança Copper Project, Brazil Page 280 FR/SC Boa
Esperanca_Technical_Report_175600.020_025_SH November 9, 2012
Lawrence, R.W.; Wang, Y. 1997. Determination of neutralization potential in the prediction of acid rock
drainage, Proc. 4th International Conference on Acid Rock Drainage, Vancouver, BC, p449-464.
Maptek Pty. Ltd., Lakewood, Colorado, 2012. Vulcan 8.1.4.
MDGEO, 2011. Serviços de Hidrogeologia. Estudos Hidrogeológicos no Projeto Boa Esperança –

Tucumã, PA. Belo Horizonte. 96p.
Metso, July 07, 2011 , “Resultados de Testes de Britabilidade”
Metso, July 11, 2011 , “Resultados de Testes de WI de Bolas”
Mineração Caraíba S.A, May 2010. Plano de Aproveitamento Econômico. 199p.
MINERAÇÃO CARAÍBA, Grading of calculation of the environmental impacts for environmental

compensation purposes. Tucumá, 2014. 24p. (Novaes & Lima, 1998)
NCL BRASIL, Plano Diretor Boa Esperança. 2008. 7p.
Outotec, June 2012 , “Relatorio de Testes Provas de Espessamento e FiltraÇão em Equipamento de

Laboratorio
Pires, J.M. & G.T. Prance 1985. The vegetation types of the Brazilian Amazon. p. 109-145. In: Prance,
G.T. & Lovejoy, T. E. (eds.). Key Environments: Amazonia. Pergamon Press, Oxford.
PIRES-O'BRIEN, M.J.; O'BRIEN, A.M. Ecologia e modelamento de florestas tropicais. Belem: FCAP-
Servico de Documentacao e Informacao, 1995. 400p.
PREFEITURA DE TUCUMÃ. Available in

http://www.prefeituradetucuma.com.br/_pags2.php?acao=noticias/exibe08&pagnot=Hist%F3ria%20d
o%20Munic%EDpio#.VPhZeK25fIU
September 7, 2017
Price, W.A.; Kwong, Y.T.J. 1997. Waste Rock Weathering, Sampling and Analysis: Observations from
the British Columbia Ministry of Employment and Investment Database. Proc. 4th International
Conference on Acid Rock Drainage, Vancouver, BC, p31-45.
Priest, S. D., and Hudson, J. A., Discontinuity Spacings in Rock, International Journal of Rock
Mechanics and Mining Sciences and Geomechanics Abstracts, Vol. 13, p. 135-48, 1976.
Rezende Eng.Minas S/S LTDA, January 2011.“The Development of the Treatment Process for Boa
Esperança Copper Ore”.
Ribeiro, J. E. L. S.,Hopkins,M. J. G., Vicentini, A., Sothers, C.A., Costa,M.A. S., Brito, J. M.,
Souza,M.A.D.,Martins,L.H.,Lohmann, L. G.,Assunção, P.A., Pereira, E. C., Silva, C. F., Mesquita, M.
R. & Procópio, L. C. 1999. Flora da Reserva Ducke. Guia de identificação das plantas vasculares de
uma floresta de terra firme na Amazônia Central. INPA-DFID, Manaus, 800 p.
RIZZINI, C.T. Nota prévia sobre a divisão fitogeográfica (florístico-sociológica) do Brasil. Revista
Brasileira Geografia. Rio de Janeiro, v. 25 n.1, p 3-63, 1963.
Rocscience, Inc., Toronto, Ontario, 2012a. Dips 5.109, visualization and analysis software for
orientation based geologic data.
Rocscience, Inc., Toronto, Ontario, 2012b. RocData 4.012, analysis of rock and soil strength data, and
the determination of strength envelopes and other physical parameters.
Rocscience, Inc., Toronto, Ontario, 2012c. Slide 6.017, 2-dimensional limit equilibrium slope stability
analysis software.
Rocscience, Inc., Toronto, Ontario, 2012d. Phase2 8.009, 2-dimensional, elasto-plastic finite elemento
stress analysis software.
SEMA/PA, Secretaria de Estado de Meio Ambiente do Estado do Pará, Decreto Estadual n. 2.099, de
27 de janeiro de 2010. Dispõe sobre a manutenção, recomposição condução da regeneração natural,
compensação e composição da área de Reserva Legal de imóveis rurais do estado do Pará e dá
outras providências.
SEMA/PA, Secretaria de Estado de Meio Ambiente do Estado do Pará, Lei n. 5.887, de 09 de maio
de 1995. Dispõe sobre a Política Estadual do Meio Ambiente, e dá outras providências.
September 7, 2017
SEMA/PA, Secretaria de Estado de Meio Ambiente do Estado do Pará, Parecer Técnico n.

12412/GEMIN/CLA/DILAP/2010. Belém. Agosto. 2010. 20p.
SGS Geosol, April 2015. Jigging, Flotation and Magnetic Separation on a Composite Sample from
Boa Esperança Project. 43p.
SICK, H. 1997. Ornitologia Brasileira. Rio de Janeiro: Editora Nova Fronteira, 861p.
Sobek, A. A.; Schüller, W.A.; Freeman, J.R.; Smith, R. M. 1978. Field and laboratory methods
applicable to overburden minesoils.EPA 600/2-78-054, 203p.
SRK Consulting (U.S.), Inc. Technical Report – Boa Esperança Copper Project, Brazil Page 281
FR/SC Boa Esperanca_Technical_Report_175600.020_025_SH November 9, 2012
SRK Consulting (U.S.), Inc., August 2013. Mineral Resource Update, Boa Esperança Copper Project,
Brazil, 17 pages.
SRK Consulting (U.S.), Inc., November 2012. Geology and Resources, Boa Esperança Copper
Project, Brazil. Feasibility Study, Volume II, 80 pages.
SRK Consulting, (Brazil), Inc., Girodo, A.C. and Passos, C. (2010). Avaliação em Nível de Falha Fatal
dos Recursos da Mina Caraíba, Depósitos de Vermelhos Oeste e Sul, Boa Esperança e Araés.
SSMA, Assessoria e Consultoria Ltda, Plano de Controle de Impacto Ambiental na Mineração. Projeto
Boa Esperança. Abril, 2010. 158 p.
SSMA, Assessoria e Consultoria Ltda, Plano de Fechamento de Mina. Projeto Boa Esperaça. Abril de
210. 193 p.
Tecnomin Projetos e Consultoria Ltda, September 2015. Basic Engineering – Boa Esperança Project.
52p.
TOMÉ, Romeu, Manual do Direito Ambiental. Editora JusPODIVM, 3.ed. 890p. 2013
Topovale Topográficos LTDA, 2008. Georreferenciamento e Levantamento Topográfico. 11p.
September 7, 2017
Tyno Consultoria, November 2015. Fundamentação legal e metodologia para análise da tributação
do CAPEX do projeto Boa Esperança em TUCUMÃ/PA da Mineração Caraíba S/A. 7p.
UNITED NATIONS. Universal Declaration on the Rights of Indigenous Peoples of the ONU. Rio de
Janeiro, 2008.
VOGBR, 2015. Executive Summary – B2 Dam and Water Pond – Boa Esperança Copper Mine – Pará.
8p.
VOGBR, 2015. Projeto básico - Mina de Cobre Boa Esperança. Relatórios Técnicos: VG14-268-EG-
RTE-0001, VG14-268-EG-RTE-0002, VG14-268-1-EG-RTE-0003, VG14-268-1-EG-RTE-0004,
VG14-268-1-EG-RTE-0005, VG14-268-EG-RTE-0006, VG14-268-1-EG-RTE-0007, VG14-268-1-EG-
RTE-0008.
WHITMORE, T. C., 1990, An introduction to tropical rain forests. Blackwell, London.
September 7, 2017
28 Glossary
28.1 Mineral Resources
The Mineral Resources and Mineral Reserves have been classified according to the “CIM Standards
on Mineral Resources and Reserves: Definitions and Guidelines” (established May 10, 2014).
Accordingly to CIM the Resources have been classified as Measured, Indicated or Inferred, while the
Reserves have been classified as Proven and Probable based on the Measured and Indicated
Resources as defined below.
A Mineral Resource is a concentration or occurrence of natural, solid, inorganic or fossilized organic

material in or on the Earth’s crust in such form and quantity and of such a grade or quality that it has
reasonable prospects for economic extraction. The location, quantity, grade, geological characteristics
and continuity of a Mineral Resource are known, estimated or interpreted from specific geological
evidence and knowledge.
An ‘Inferred Mineral Resource’ is that part of a Mineral Resource for which quantity and grade or quality
can be estimated on the basis of geological evidence and limited sampling and reasonably assumed,
but not verified, geological and grade continuity. The estimate is based on limited information and
sampling gathered through appropriate techniques from locations such as outcrops, trenches, pits,
workings and drillholes.
An ‘Indicated Mineral Resource’ is that part of a Mineral Resource for which quantity, grade or quality,
densities, shape and physical characteristics can be estimated with a level of confidence sufficient to
allow the appropriate application of technical and economic parameters, to support mine planning and
evaluation of the economic viability of the deposit. The estimate is based on detailed and reliable
exploration and testing information gathered through appropriate techniques from locations such as
outcrops, trenches, pits, workings and drillholes that are spaced closely enough for geological and
grade continuity to be reasonably assumed.
A ‘Measured Mineral Resource’ is that part of a Mineral Resource for which quantity, grade or quality,
densities, shape, physical characteristics are so well established that they can be estimated with
confidence sufficient to allow the appropriate application of technical and economic parameters, to
support production planning and evaluation of the economic viability of the deposit. The estimate is
based on detailed and reliable exploration, sampling and testing information gathered through
appropriate techniques from locations such as outcrops, trenches, pits, workings and drillholes that
are spaced closely enough to confirm both geological and grade continuity.
28.2 Mineral Reserves

A Mineral Reserve is the economically mineable part of a Measured or Indicated Mineral Resource
demonstrated by at least a Preliminary Feasibility Study. This Study must include adequate information
on mining, processing, metallurgical, economic and other relevant factors that demonstrate, at the time
of reporting, that economic extraction can be justified. A Mineral Reserve includes diluting materials
and allowances for losses that may occur when the material is mined.
A ‘Probable Mineral Reserve’ is the economically mineable part of an Indicated, and in some
circumstances a Measured Mineral Resource demonstrated by at least a Preliminary Feasibility Study.
September 7, 2017
This Study must include adequate information on mining, processing, metallurgical, economic, and
other relevant factors that demonstrate, at the time of reporting, that economic extraction can be
justified.
A ‘Proven Mineral Reserve’ is the economically mineable part of a Measured Mineral Resource
demonstrated by at least a Preliminary Feasibility Study. This Study must include adequate information
on mining, processing, metallurgical, economic, and other relevant factors that demonstrate, at the
time of reporting, that economic extraction is justified.
28.3 Definition of Terms

The following general mining terms may be used in this report.
Table 28.1: Definition of Terms.

Term Definition
Assay The chemical analysis of mineral samples to determine the metal content.
When two or more sample results are combined to give an average result over
Composite
a larger distance.
The grade of mineralized rock, which determines whether or not it is
Cut-off Grade (CoG)
economical to recover its gold content by further concentration.
Dilution Waste, which is unavoidably mined with ore.
Dip Angle of inclination of a geological feature/rock from the horizontal.
Fault The surface of a fracture along which movement has occurred.
Footwall The underlying side of an orebody or stope.
Gangue Non-valuable components of the ore.
Grade The measure of concentration of gold within mineralized rock.
Hanging wall The overlying side of an orebody or slope.
Igneous Primary crystalline rock formed by the solidification of magma.
An interpolation method of assigning values from samples to blocks that
Kriging
minimizes the estimation error.
Level Horizontal plane through the mineral deposit
Lithological Geological description pertaining to different rock types.
Mineral/Mining Lease A lease area for which mineral rights are held.
Pertaining to rocks formed by the accumulation of sediments, formed by the
Sedimentary
erosion of other rocks.
A thin, tabular, horizontal to sub-horizontal body of igneous rock formed by the
Sill
injection of magma into planar zones of weakness.
Stratigraphy The study of stratified rocks in terms of time and space.
Direction of line formed by the intersection of strata surfaces with the
Strike
horizontal plane, always perpendicular to the dip direction.
Sulfide A sulfur-bearing mineral.
Variogram A statistical representation of the characteristics (usually grade).
September 7, 2017
28.4 Abbreviations
The following abbreviations may be used in this report.
Table 28.2: Abbreviations

Abbreviation Unit or Term
% percent
° degree (degrees)
°C degrees Centigrade
Ag Silver
Al Aluminium
amsl above mean sea level
ANFO ammonium nitrate and fuel oil
ARD acid rock drainage
Au Gold
CFEM Financial Compensation for the Exploitation of Mineral Resources
CIL carbon-in-leach
Canadian Institute of Mining, Metallurgy and Petroleum Standards on Mineral
CIM
Resources and Reserves: Definitions and Guidelines
CIMM Centro de Investigaçãoo Mineira e Metalúrgica
Co Cobalt
Codelco Corporación Nacional del Cobre
COEMA State Environmental Council
CoG cut-off grade
CONAMA Conselho Nacional do Meio Ambiente
cm centimeter
cm2 square centimeter
cm3 cubic centimeter
Cr Chromium
Cu Copper
DNPM Departamento Nacional de Produção Mineral
EIA Environmental Impact Assessment
Fe Iron
FS Feasibility Study
g gram
g/t grams per tonne
Ga Giga-annum or billion years
gal gallon
gpm gallons per minute
hr hour
ha hectares
ICP induced couple plasma
ID2 inverse distance squared
ID3 inverse distance cubed
IDW inverse distance weighted
INCRA National Institute for Agrarian Reform
IOCG iron-oxide-copper-gold
kg kilograms
km kilometer
km2 square kilometer
koz thousand troy ounces
kt thousand tonnes
kW kilowatt
kWh kilowatt-hour
L liter or liters
September 7, 2017
Abbreviation Unit or Term

LOI loss on ignition
LoM life of mine
m meter
m2 square meter
Ma million years
m3 cubic meter
masl meters above sea level
MCSA Mineração Caraíba S.A.
mm millimeter
mm2 square millimeter
mm3 cubic millimeter
Mn Manganese
Mo Molybdenum
Mt million tonnes
NAG net acid generation
Ni Nickel
NI 43-101 Canadian National Instrument 43-101
NN nearest neighbor
OK ordinary kriging
oz troy ounce
oz/t ounces per short ton
PCA Environmental Control Plan
PAE Plano de Aproveitamento Econômico (Economic Development Plan)
PRAD Degradated Areas Recuperation Plan
ppb parts per billion
ppm parts per million
QA/QC Quality Assurance/Quality Control
R$ Brazilian Reais
RC rotary circulation
RoM run-of-mine
RMR rock mass ratings
RQD rock quality description
sec second
SEMA Pará State Environmental Agency
SG specific gravity
SGS SGS Geosol Laboratorios LTDA
SME selective mining unit
SRM standard reference material
t tonne (metric ton) (2,204.6 pounds)
t/d tonnes per day
t/hr tonnes per hour
t/y tonnes per year
TSF tailings storage facility
µm micron or microns
US$ United States dollars
XRD x-ray diffraction
y Year
Zn Zinc
September 7, 2017
Disclaimer
The opinions expressed in this Report are based on the information supplied to SRK Consultores do
Brasil LTDA. (SRK) by Mineração Caraíba S.A. (MCSA). These opinions are provided in response to
a specific request from MCSA to do so and are subject to the contractual terms between SRK and
MCSA. SRK has exercised all due care in reviewing the supplied information. While SRK has
compared key supplied data with expected values, the accuracy of the results and conclusions from
the review are entirely reliant on the accuracy and completeness of the supplied data. SRK does not
accept responsibility for any errors or omissions in the supplied information and, except as otherwise
provided by law, does not accept any consequential liability arising from commercial decisions or
actions resulting from them. The opinions presented in this report apply to the site conditions and
features as they existed at the time of SRK’s investigations and those reasonably foreseeable. These
opinions do not necessarily apply to conditions and features that may arise after the date of this Report.
Copyright
This report is protected by copyright vested in SRK Consultores do Brasil LTDA. Other than for the
purpose legislated under provincial securities law and stipulated in SRK’s client contract, this report
may not be reproduced or transmitted in any form or by any means whatsoever by any person without
the written permission of the copyright holder, SRK, except for the purposes set out in this report.
September 7, 2017
APPENDIX
September 7, 2017
Appendix A - Analytical Quality Control Data and Relative

Precision Charts
September 7, 2017
Time series plots for Blank Samples and Standard Reference Material assayed by SGS Geosol,
Vespasiano, MG, Brazil, between 2008 and 2009.
Blank SGS HG
Statistics Cu (% )
Project Boa Esperança Sample Count 75 73
Data Series 2008-2009 Blanks and Standards Expected Value 0.01 1.10
Data Type Core Samples Standard Deviation 0.17 0.07
Commodity Cu in % Data Mean 0.08 1.06
Laboratory SGS Geosol (Brazil) Outside 2StdDev/UL 23% 1%
Analytical Method Atomic Absorption Spectroscopy Below 2StdDev - 1
(Methods AAS40B and AAS41B) Above 2StdDev - 0
Detection Limit Cu (0.01%)
Time Series for Blanks - Method AAS40B/ AAS41B Time Series for Reference Material SGS (High Grade)
(SGS Geosol (Brazil); 2008-2009 Core Samples) (SGS Geosol (Brazil); 2008-2009 Core Samples)
1.2 1.4
N = 75 Blank (Cu %)
N = 73 SGS HG
Upper Limit Expected Value
1.0 1.3 +2StdDev
-2StdDev
Cu (%)
Cu (%)
0.8 1.2
0.6 1.1
0.4 1.0
0.2 0.9
0.0 0.8
SD-00013 SD-000425 SD-000805 SD-001215 SD-001625 SD-002001 SD-002424 SD-002922 SD-000009 SD-000453 SD-000840 SD-001265 SD-001564 SD-002023 SD-002453 SD-002890
Samples (Time Series) Samples (Time Series)
September 7, 2017
Bias Charts and Precision Plots for pulp duplicate samples assayed by SGS Geosol Vespasiano,
MG, Brazil.
Statistics Original Field Duplicate

Sample Count 73 73
Project Boa Esperança Minimum Value 0.00 0.00
Data Series 2008-2009 Field Duplicates Maximum Value 3.60 2.95
Data Type Core Samples Mean 0.43 0.41
Commodity Cu in % Median 0.15 0.15
Analytical Method AAS40B / AAS41B Standard Error 0.08 0.07
Detection Limit 0.01% Standard Deviation 0.70 0.63
Original Dataset SGS Geosol Vespasiano, Original Assays Correlation Coefficient 0.99
Paired Dataset SGS Geosol Vespasiano, Duplicate Assays Pairs ≤ 10% HARD 74.0%
Bias Chart Coarse Field Duplicate Assay Pairs (Cu%) Ranked Half Absolute Relative Deviation Plot
(SGS Geosol (Brazil); Core Samples) (SGS Geosol (Brazil); Core Samples)
5.00 100%
N = 73 pairs N = 73 pairs Cu assay
4.50 90%
Field Duplicate Assays (Cu %)
4.00 80%
3.50 70%
3.00 60%
HARD (%)
y = 0.9179x
2.50 R² = 0.9869
50%
2.00 40%
1.50 30%
2008-2009 Field Duplicates
1.00 +10% 20%
0.50 -10% 10%
0.00 0%
0.00 0.50 1.00 1.50 2.00 2.50 3.00 3.50 4.00 4.50 5.00 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Original Assays (Cu %) Rank
Bias Chart Coarse Field Duplicate Assay Pairs (Cu%) Mean versus Half Relative Deviation Plot
1.0 100%
N = 73 pairs N = 73 pairs
0.9 80% Cu assay
y = 0.9179x
0.8 0% Line
R² = 0.9869 60%
0.7 40%
0.6 20%
HRD (%)
0.5 0%
0.4 -20%
0.3 -40%
2008-2009 Field Duplicates
0.2 +10% -60%
0.1 -10%
-80%
0.0 -100%
0.0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9 1.0 0.001 0.01 0.1 1 10 100
Original Assays (Cu %) Individual Mean (Cu %)
Q-Q Plot Field Coarse Duplicate Assay Pairs Mean versus Half Absolute Relative Deviation Plot
10 100%
N = 73 pairs
1
10%
HARD (%)
0.1
1%
0.01
N = 73 pairs
0.001 0%
0.001 0.01 0.1 1 10 0.001 0.01 0.1 1 10
September 7, 2017
Vespasiano, MG, Brazil, in 2010.
Blank (Cu) SGS LG SGS MG SGS HG

Statistics
Project Boa Esperança Sample Count 47 30 27 32
Data Series 2010 Expected Value 0.01 0.20 0.61 1.10
Data Type Core Samples Standard Deviation 0.00 0.00 0.01 0.07
Commodity Cu in % Data Mean 0.01 0.21 0.63 1.05
Laboratory Intertek Outside 2StdDev/UL 0 37% 48% 0%
Analytical Method Atomic Absorption Spectroscopy Below 2StdDev − 4 3 0
(Method GA50 and GA51) Above 2StdDev − 7 10 0
Detection Limit Cu (0.01%)
Time Series for Blanks - Method GA50 and GA51 Time Series for Reference Material SGS - Cu (Low Grade)
(Intertek; Blank 1 ) (Intertek; 2010 Core Samples)
0.12 0.30
N = 47 Blank (Cu)
N = 30 SGS LG
Upper Limit Expected Value
0.10 +2StdDev
0.25
-2StdDev
0.08
Cu (%)
Cu (%)
0.06 0.20
0.04
0.15
0.02
0.00 0.10
Time Series for Reference Material SGS - Cu (Medium Grade) Time Series for Reference Material SGS - Cu (High Grade)
(Intertek; 2010 Core Samples) (Intertek; 2010 Core Samples)
1.2 1.6
N = 27 SGS MG N = 32 SGS HG
Expected Value Expected Value
1.0 +2StdDev
+2StdDev 1.4
-2StdDev -2StdDev
Cu (%)
0.8
Cu (%)
1.2
0.6
1.0
0.4
0.8
0.2
0.0 0.6
SD-003476 SD-003718 SD-003886 SD-004140 SD-004569 SD-004920 SD-003491 SD-003695 SD-003907 SD-004145 SD-004281 SD-004540 SD-004829
September 7, 2017
MG, Brazil.
(Intertek; Core Samples) (Intertek; Core Samples)
5 100%
90%
4 80%
70%
3 60%
HARD (%)
y = 0.9986x 50%
R² = 0.968
2 40%
30%
2010 Field Duplicates
1 20%
+10%
10%
-10%
0 0%
0 1 2 3 4 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
1.0 100%
N = 48 pairs N = 48 pairs
80% Cu assay
y = 0.9986x
0.8 R² = 0.968 0% Line

60%
40%
0.6 20%
HRD (%)
0%
0.4 -20%
2010 Field Duplicates -40%

0.2 +10% -60%
-10%
-80%
0.0 -100%
0.0 0.2 0.4 0.6 0.8 1.0 0.0001 0.001 0.01 0.1 1 10
10 100%
N = 48 pairs
1
10%
HARD (%)
0.1
1%
0.01
N = 48 pairs
0.001 0%
0.001 0.01 0.1 1 10 0.0001 0.001 0.01 0.1 1 10
September 7, 2017
Blank (Cu) SGS LG SGS - MG SGS HG

Statistics
Laboratory SGS - GEOSOL Outside 2StdDev/UL 0 58% 24% 2%
Analytical Method AAS40B / AAS41B Below 2StdDev − 15 5 2
Detection Limit Cu (0.01%) Above 2StdDev − 48 21 0
Time Series for Blanks - AAS40B / AAS41B Time Series for Reference Material SGS - Cu (Low Grade)
(SGS Geosol (Brazil); 2012 Core Samples) (SGS - GEOSOL; 2012 Core Samples)
0.15 0.70
N = 108 Blank (Cu) SGS - MG
N = 108 Expected Value
Upper Limit +2StdDev
0.60 -2StdDev
0.12
0.50
Cu (%)
Cu (%)
0.09
0.40
0.06
0.30
0.03
0.20
0.00 0.10
SD-005011 SD-005412 SD-005842 SD-006327 SD-006759 SD-007215 SD-007653 SD-008097 SD-008569 SD-008982 SD-009438 SD-005003 SD-005470 SD-005911 SD-006372 SD-006796 SD-007264 SD-007690 SD-008127 SD-008612 SD-009067 SD-009512
(SGS - GEOSOL; 2012 Core Samples) (SGS - GEOSOL; 2012 Core Samples)
1.20 1.60
SGS - MG SGS HG
+2StdDev +2StdDev
-2StdDev -2StdDev
1.00 1.40
Cu (%)
0.80 1.20
Cu (%)
0.60 1.00
0.40 0.80
0.20 0.60
SD-005023 SD-005447 SD-005875 SD-006311 SD-006777 SD-007269 SD-007715 SD-008155 SD-008594 SD-009045 SD-009479 SD-005016 SD-005479 SD-005901 SD-006341 SD-006804 SD-007243 SD-007700 SD-008137 SD-008635 SD-009083 SD-009553
September 7, 2017
MG, Brazil.

Sample Count 108 108
Data Series 2012 Field Duplicates Maximum Value 12.50 11.42
Analytical Method Atomic Absorption Spectroscopy Standard Error 0.16 0.15
Original Dataset SGS Geosol Vespasiano, Original Assays Correlation Coefficient 1.00
Paired Dataset SGS Geosol Vespasiano, Field Duplicate AsPairs ≤ 10% HARD 88.0%
100%
N = 108 pairs Cu assay
12
90%
N = 108 pairs
80%
10
70%
8 60%
HARD (%)
y = 0.9477x
R² = 0.9934 50%
6
40%
4 30%
+10% 20%
2
-10% 10%
0 0%
0 2 4 6 8 10 12 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
13.0 100%
12.0 N = 108 pairs N = 108 pairs
y = 0.9477x 80% Cu assay
11.0
R² = 0.9934 0% Line
10.0 60%
9.0 40%
8.0
20%
HRD (%)
7.0
0%
6.0
5.0 -20%
4.0
2012 Field Duplicates -40%
3.0
+10% -60%
2.0
-10%
1.0 -80%
0.0 -100%
0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0 8.0 9.0 10.0 11.0 12.0 13.0 0.001 0.01 0.1 1 10 100
100 100%
N = 108 pairs
10
10%
1
HARD (%)
0.1
1%
0.01
N = 108 pairs
0.001 0%
0.001 0.01 0.1 1 10 100 0.001 0.01 0.1 1 10 100
September 7, 2017
Blank (Cu) SGS LG SGS MG SGS HG

Statistics
Laboratory SGS - GEOSOL Outside 2StdDev/UL 3% 33% 5% 10%
Analytical Method AAS40B / AAS41B Below 2StdDev − 2 2 4
Detection Limit Cu (0.01%) Above 2StdDev − 11 0 0
Time Series for Blanks - Method AAS40B / AAS41B Time Series for Reference Material SRK - Cu (Low Grade)
(SGS Geosol (Brazil); 2013 Core Samples) (SGS - GEOSOL; 2013 Core Samples)
0.20 0.30
SGS LG
N = 39 Blank (Cu)
N = 39
Expected Value
Upper Limit +2StdDev
-2StdDev
0.15 0.25
Cu (%)
Cu (%)
0.10 0.20
0.05 0.15
0.00 0.10
(SGS - GEOSOL; 2013 Core Samples) (SGS - GEOSOL; 2013 Core Samples)
0.80 1.60
N = 38 SGS MG N = 40 SGS HG
Expected Value Expected Value
+2StdDev +2StdDev
1.40
0.70
-2StdDev -2StdDev
Cu (%)
Cu (%)
1.20
0.60
1.00
0.50
0.80
0.40 0.60
September 7, 2017
MG, Brazil.

Sample Count 39 39
Data Series 2013 Field Duplicates Maximum Value 4.60 4.28
Analytical Method Atomic Absorption Spectroscopy Standard Error 0.16 0.15
Original Dataset SGS Geosol, Original Assays Correlation Coefficient 1.00
Paired Dataset SGS Geosol, Field Duplicate Assays Pairs ≤ 10% HARD 84.6%
5 100%
90%
4 80%
70%
3 60%
HARD (%)
y = 0.9415x 50%
R² = 0.9951
2 40%
30%
1 +10% 20%
-10% 10%
0 0%
0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0 4.5 5.0 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
100%
1.4 N = 39 pairs
80% Cu assay
N = 39 pairs
1.2 0% Line
60%
y = 0.9415x
R² = 0.9951 40%
1.0
20%
HRD (%)
0.8
0%
0.6 -20%
0.4 2013 Field Duplicates -40%
+10% -60%
0.2
-10%
-80%
0.0 -100%
0.0 0.2 0.4 0.6 0.8 1.0 1.2 1.4 0.01 0.1 1 10
10 100%
N = 39 pairs
1 10%
HARD (%)
0.1 1%
N = 39 pairs
0.01 0%
0.01 0.1 1 10 0.01 0.1 1 10
September 7, 2017

Ni 43 101 Report Boa

Uploaded by

Document Information

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Ni 43 101 Report Boa

Uploaded by

Copyright:

Available Formats

Feasibility Study

Technical Report for the

Report Prepared for

SRK Consultores do Brasil LTDA.

Ero Copper Corp.

SRK Consultores do Brasil LTDA.

SRK Project Number 031.14

Effective Date: June 1, 2017

Qualified Person List:

Carlos Barbosa, MAusIMM Rubens Mendonça, MAusIMM Girogio di Tomi, MAusIMM

1.1 Property Description and Location

The legal status of MCSA’s mining rights is as follows:

1.3 Geology and Mineralization

1.4 Exploration Status

1.5 Mineral Resource Estimate

• Copper price: US$4.00 per pound;

The internal copper CoG (excluding mining costs) is 0.20 %.

1.6 Mineral Reserve Estimate

(1) Effective Date: June 1, 2017

1.7 Mining Methods

Table 3: Proposed angles for each type of material

Saprolite Weathered Rock Fresh Rock

Bench Heigth 10,0 m 10,0 m 10,0 m

Berm Width 7,0 m 5,0 m 5,0 m

Slope Face Angle 45º 70º 83º

Inter-Ramp Angle 31,5º 49º 58º

1.8 Mineral Processing and Metallurgical Testing

Their results confirmed the previous experimental conclusions:

Figure 1: Overall recovery (%) x ROM grade (% Cu)

1.9 Recovery Methods

• “VLC-Testes de sedimentação e filtração-15/12/14”;

• “Simulação de britagem Metso, novembro 2014”; and,

1.9.1 Final Process Flowsheet Design

1.9.2 Final Process Material Balance

1.9.3 Final Process Plant Water Balance

1.10.1 Water Pond

1.10.3 Tailings Storage

• Inventory of water sources and users;

• Flow measurements in major drainages;

1.10.5 Project Infrastructure

The primary logistic challenges facing the Project are:

• Long distance to port;

• Chronic congestion at ports near the Project.

1.10.6 Environmental Management and Permitting

The EIA classifies areas of influence into three categories:

• Área Diretamente Afetada (ADA) = Directly Affected Area;

1.11 Economic Analysis

Table 4: Copper Prices - US$/t-Cu

Table 5: Logistic Costs - Container

Table 6: Logistic Costs - Bulk

Table 7: Exchange Rates

1.11.1 Capital Expenditures

The capital estimate is shown in Table 8.

Table 8: Capital Costs Summary by Area

1.11.2 Operating Costs

Table 9: Project Operating Costs

1.11.3 Economic Results

Table 10: Economic Results

Free Cash Flow R$000’s 1,345,477

1.12 Conclusions and Recommendations

SRK recommends that analytical procedures be standardized, including documentation of procedures,

In addition, it is recommended that social-environmental management practices be undertaken to

Table 1.11: Proposed Budget for Recommended Work

Duplicate core samples, including cutting, shipping & analysis 12,000