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Brazil halts work at Vale mine with hundreds missing after dam burst

Stock MarketsJan 26, 2019 11:58AM ET
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© Reuters. General view from above of a dam owned by Brazilian miner Vale SA that burst, in Brumadinho

By Gram Slattery

BRUMADINHO, Brazil (Reuters) - Teams of rescuers were preparing to dig through thick mud on Saturday in a search for survivors of a dam burst at a Brazilian iron ore mine owned by Vale SA (SA:VALE3) that left hundreds missing and halted operations.

Firefighters focused their hopes on a bus, a train, mining offices and nearby homes that were buried on Friday when a torrent of mud was unleashed by the dam break at Vale's Corrego do Feijao facility in Minas Gerais state.

More than a dozen helicopters flew over the area on Saturday to survey the disaster and aid the rescue teams.

The state fire department said in a statement that only 10 bodies had been found so far. In a separate statement, the department reduced the number of missing to roughly 300 people, after 46 were found alive.

"Unfortunately, at this point, the chances of finding survivors are minimal. We're likely to just be recovering bodies," Romeu Zema, governor of Minas Gerais, told local media.

During a press conference, Zema said the mining complex had all its permits in order and it was unclear what caused the collapse of the dam, which had been inactive for years.

The National Mining Agency ordered Vale, the largest producer of iron ore in the world, to halt operations at the Corrego do Feijao mine, located near the town of Brumadinho in mining-focused Minas Gerais, according to a document seen by Reuters.

State prosecutors have requested that 5 billion reais ($1.33 billion) in Vale's accounts be frozen to be directed toward efforts to pay for damages, Antonio Sergio Tonet, a prosecutor with the Minas Gerais Justice Department, told reporters, saying he expected more assets to be frozen.

Earlier, a state judge ordered Vale to freeze 1 billion reais in its accounts.

'IN THE MUD'

The death toll was expected to rise sharply, according to Avimar de Melo Barcelos, the mayor of Brumadinho.

Israel has offered to send search equipment that could be used to find victims in up to 10 meters (33 feet) of mud, Zema said. Search dogs were being flown in from Rio de Janeiro to aid in the rescue efforts.

All of those missing are Vale employees or contractors, a police spokesman said.

"I know a lot of the affected people: Two sisters-in-law, a cousin, many friends there in the community. They're in the mud," local resident Carlos Jose dos Santos told Reuters.

Minas Gerais is still recovering from the 2015 collapse of a larger dam that killed 19 people in Brazil's worst environmental disaster. That dam, owned by the Samarco Mineracao SA joint venture between Vale and BHP Group Ltd (AX:BHP), buried a village and poured toxic waste into a major river.

New Brazilian President Jair Bolsonaro visited Minas Gerais and flew over the disaster area Saturday morning. He dispatched three ministers to the area, who addressed reporters after Zema.

Vale Chief Executive Fabio Schvartsman said the dam that burst on Friday was being decommissioned and its capacity was about a fifth of the total waste spilled at Samarco. He said equipment had shown the dam was stable on Jan. 10 and it was too soon to say why it collapsed.

The Corrego do Feijao mine is one of four in Vale's Paraoeba complex, which includes two processing plants. The complex produced 26 million tonnes of iron ore in 2017, or about 7 percent of Vale's output, with Corrego do Feijao accounting for 7.8 million tonnes, according to the company's website.

Operations at Samarco remain halted over new licensing, while the companies have worked to pay damages out of court, including an agreement that quashed a 20 billion reais ($5.31 billion) civil lawsuit last year. Federal prosecutors suspended but have not closed an even larger lawsuit.

Brazil halts work at Vale mine with hundreds missing after dam burst
 

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Comments (1)
short gold
short gold Jan 26, 2019 11:44AM ET
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Lock up all their money make them bankrupt set al example of them. Make all the miners pay for lax safety
Alfredo Cunha
Alfredo Cunha Jan 26, 2019 11:44AM ET
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Great idea, however who are the main stockholders? I give you a hint: Brazilian politicians ...
 
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