MercoPress. South Atlantic News Agency

Vale vows to cut 10% iron ore output and decommission ten dangerous sludge dams

The disaster raised fresh questions about Vale's commitment to safety after a similar deadly dam burst just over three years ago at a mine it jointly owned

Vale SA, the world’s largest iron ore miner, on Tuesday vowed to take as much as 10% of its ore output offline in order to decommission ten more dams like the one that burst last week, killing scores of workers and nearby residents.

Chief Executive Fabio Schvartsman said it would temporarily paralyze operations using those dams and spend 5 billion reais (US$ 1.2bn) to decommission them over the next three years.

The move came as prosecutors began arresting Vale executives over the Friday collapse of a tailings dam in the Brazilian town of Brumadinho, which was hit by a torrent of mining waste that killed at least 85 people and left hundreds more missing.

The disaster raised fresh questions about the company’s commitment to safety after a similar deadly dam burst just over three years ago at a nearby mine it jointly owned.

“We decided the company should, once and for all, do what it takes to remove any doubt about the safety of Vale’s dams,” Schvartsman told journalists in Brasilia.

The burst Brumadinho dam was one of 19 “upstream” tailings dams owned by Vale, all in the state of Minas Gerais, built with a method banned in Peru and Chile for safety reasons.

Vale had already begun the process of decommissioning nine of them. A corporate presentation showed that the company had studied but did not implement several steps that could have prevented or lessened the damage from the Brumadinho disaster.

Schvartsman said Vale’s board had approved the decision to decommission its 10 remaining upstream dams and suspend the related mining operations as necessary, relocating 5,000 workers to other parts of the company.

Those operations currently produce 40 million tons of iron ore and 11 million tons of pellets per year, he said. Vale forecast total iron output of 390 million in 2018.

At the headquarters for the local mining union, which lost more than one in 10 members by organizers’ count, treasurer José Francisco Mateiro blamed the company and authorities for putting him and his comrades at risk.

“They call it an accident but the design of those dams was premeditated,” he said. “There have been warnings about all mining dams for a long time now.”

Government ministers have said Brazil’s mining regulations are broken. The country’s top prosecutor said the company should be criminally prosecuted and executives held personally responsible.

On Monday, a presidential task force contemplated forcing out Vale’s management, but by Tuesday senior officials pushed back on the idea. “There aren’t conditions for any degree of interference. It would not be a good signal to the market,” presidential chief of staff Onyx Lorenzoni said in a news briefing.