How an Environmental Disaster Changed Brazil’s Mining Industry – by R.T. Watson (Bloomberg News – June 6, 2018)

The future of some of the world’s biggest mining operations remains mired in uncertainty after a fatal dam spill helped transform Brazil’s relatively light corporate scrutiny into a legal minefield.

The 2015 disaster at the Samarco iron-ore mine, which left 19 dead, precipitated a cascade of legal issues and challenges for the still-shut venture owned by Vale SA and BHP Billiton Ltd.

Mining’s reputation in Brazil was further tarnished this year when an alleged waste-water leak at the world’s largest alumina refinery, owned by Oslo-based Norsk Hydro ASA, led to a court-ordered 50 percent production curtailment.

The Samarco accident, considered Brazil’s worst environmental disaster, has made prosecutors and judges more critical of companies, say lawyers including Clovis Torres. The former Vale executive, who played a key role in the legal proceedings when the Samarco partners launched cleanup and compensation efforts, says officials are looking at mining and metal operations much more closely in Brazil even though the laws haven’t changed.

“Mining has a bad image at the moment,” Torres said by telephone from Sao Paulo. “I would prefer to believe judges won’t rule based on current social circumstance, or media frenzy and pressure, and instead by the rule of law.”

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