Check out the latest Staff Blog update that talks about what's changed, what's new, and what's up with these "Pixels".
A volcano in the jungle. No smoke coming out the top yet...
Large terrain features (volcanoes, caves, caverns, rock shelters, and rock outcroppings) are drawn as separate meshes over top the "ground mesh".
Volcanic eruptions are just one of the many types of natural disasters modeled in the game.