Samarco execs face charges after Brazil dam collapse
Brazilian police will seek arrest warrants for six Samarco employees over the dam that collapsed last November.
Alleged shortcomings in the oversight of the Samarco dam that collapsed last November and killed at least 17 people have led Brazilian police to seek arrest warrants for six Samarco employees and a consultant to the BHP Billiton and Vale-owned joint venture company.
The targeted seven — including Samarco chief executive at the time of deadly disaster, Ricardo Vescovi, who stepped down in January to prepare his defence — are being accused of qualified homicide, the Brazilian equivalent of involuntary manslaughter.
In Brazil qualified homicide carries a maximum sentence of 12 to 30 years in prison.
The move by Minas Gerais state police follows its receipt of a technical report into the disaster.
It concluded that the cause of the Fundao dam collapse was liquefaction, with seven contributing factors.
They included alleged failures in water-level monitoring, monitoring equipment failures, and substantial increases in the dam’s height.
Meanwhile, BHP shares were smashed yesterday, falling 8.2 per cent or $1.45 to $16.18 amid a broad market shakedown.
BHP and Vale said the police had made serious allegations about the Samarco dam collapse that needed to be fully considered. The companies have previously ordered an external investigation into the accident, led by a panel of geotechnical experts and the US lawyers Cleary Gottlieb.
“Until it is completed, we will not speculate about the cause, or causes, or talk about what may or may not have contributed to the failure of the dam,’’ BHP and Vale said.
The police move comes as Samarco and its owners negotiate with Brazilian authorities for the establishment of a foundation to fund the rehabilitation and humanitarian effort following the disaster, which all but wiped out the nearby town of Bento Rodrigues as red sludge was carried 600km down the Rio Doce river system to the Atlantic Ocean.
There was no reference by the police to their investigations being extended to the board of directors of Samarco, which includes two BHP nominees.
The most senior is Jimmy Wilson, BHP’s long-serving Perth-based iron ore chief. Under BHP’s sweeping organisational changes announced by BHP CEO Andrew Mackenzie on Tuesday, Mr Wilson will step down from the position on March 1 after losing the contest for the new Australia minerals president position to coal boss Mike Henry.
Mr Mackenzie told analysts on a profit briefing that Mr Wilson was still on the Samarco board. He said Mr Wilson would be staying with BHP until June, and “longer if we need him’’ as BHP studies the best way to run joint venture operations “given what’s happened’’.
Tuesday’s profit report from BHP was the first to include financial impacts of the dam collapse.
BHP took an exceptional charge of $US1.2 billion before tax ($US860 million after tax) in the interim results for the Samarco disaster.