Brazil pellet producer Samarco, a 50/50 joint venture between Brazil’s Vale and BHP Billiton, was fined in $30.1 million (BRL 112 million) by a local environment authority, following a tragic iron ore waste dam burst earlier this month, which killed 11 people.
Semad, the environment authority of the state of Minas Gerais, fined Samarco in $30.1 million (BRL 112 million) due to the damages the company caused to the environment. Brazil’s national water agency, ANA, has warned a few days ago that the presence of elements like arsenic, zinc, copper and mercury make the water at the Rio Doce untreatable for human consumption. Media reports said the lack of oxygen and high temperatures caused by the pollutants killed off much of the aquatic life along a 500km stretch of the river.
Semad said it could apply further fines after it determines and quantifies the extent of the damages caused by Samarco. Semad’s current $30.1 million fine is much higher than the amount of money Semad received through fines in the cumulative period of January to November this year, which reached about BRL 11.2 million ($301,249).
Earlier this week, Brazil’s president, Dilma Rousseff, fined Sarmaco BRL 250 million ($67 million) for the dam burst. Since then, the company has been facing increased scrutiny from local regulators.
In addition to the current fines Samarco received, the federal justice of neighboring state, Espirito Santo, determined the Vale-BHP owned company should prevent the arrival of the iron ore waste to its coast. The company has 24 hours to adopt emergency measures to avoid the waste to reach the coast of Espirito Santo; otherwise, it will face a BRL 10 million/day ($2.6 million/day) fine.
While pressure over Samarco continues, Vale and BHP decided this week to start an independent investigation to determine the causes of the burst.
BHP’s president, Jac Nasser, said on Thursday the company’s shareholders are currently concerned over the sustainability of the dividends paid by the Anglo Australian miner. Nasser’s comments appear at a moment global iron ore prices remain low and the same time the company faces some pressure due to the occurrence in the city of Mariana, in the state of Minas Gerais.
Samarco’s president, Ricardo Vescovi de Aragão, obtained a habeas corpus, a legal recourse, which prevented him to go to jail as result of the dam burst.