Restart for Samarco mine in Brazil ‘possible by year end’
The BHP Billiton iron ore operation in Brazil could be back in production in the December quarter.
The BHP Billiton and Vale-owned Samarco iron ore operation in Brazil could be back in production at a reduced annual rate of 20 million tonnes a year in the December quarter under approvals being sought by the joint venture.
The return to production — it was a 30 million-tonne-a-year producer — on that timeline would be much quicker than thought possible after November’s deadly tailings dam failure that sent a tsunami of tailings down a 600km stretch of the Rio Doce to the Atlantic, and devastating the nearby town of Bento Rodrigues in the process.
Seventeen people died and two have been listed as missing, although unconfirmed local media reports said the 18th victim had been identified by his family during the week.
The reports said he was a 55-year-old contractor with Integral Engineering and was working at the mine site at the time of the tailings dam breach.
Speaking to The Weekend Australian from Rio de Janeiro, the BHP executive in charge of the company’s response to the tragedy, Dean Della Valle, said the owners and Samarco as the operating company had been “targeting the last quarter of this year as a technically feasible starting point’’.
“That is subject to us convincing ourselves we can do it safely, and subject to us convincing the regulators on that, and obviously having community support,’’ Mr Della Valle said.
He said Samarco was not proposing to use the exiting tailings system in any shape or form. The plan was to use near-exhausted iron ore open cuts in the area.
Mr Della Valle said while the open cuts probably had some life left in them as iron ore producers, their obvious value now was in using them to dispose of tailings for a restarted operation.
Starting out using open pits owned by Samarco (Vale has exhausted pits in the area), the concept is to have five years ahead of a restarted operation based on open-cut disposal.
“In that five-year period, you would have the (external) investigation (into the dam collapse) complete, you would understand the mechanism of the failure, you would understand what the future tailings dam would look like, and you would determine what the long-term future options are for running Samarco,’’ he said.
Mr Della Valle said there was no timeline on the approvals process for a restart, and Samarco’s application for it would be subject to the “scrutiny it deserves’’.
Confidence that there would be a restart in the near term increased following the recent $US2.4 billion-$US3bn compensation and rectification agreement between Samarco, the owners, the national government and the governments of the states affected by the tailings tsunami.
Mr Della Valle said it was clear there was goodwill at the national level for a restart, with Samarco at full production accounting for about 1.5 per cent of Brazil’s GDP. Local support is also said to be strong.
About 6000 jobs rely on the operation. An external investigation into the disaster, led by New York-based law firm and Latin American specialists Cleary Gottlieb Steen & Hamilton, is expected to be completed by the middle of the year.
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