Brazil’s Vale signs $7 billion settlement in mining disaster

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FILE – In this Jan. 27, 2019 file photo, rescue workers in a helicopter search a flooded area after a dam collapsed in Brumadinho, Brazil. Brazilian mining giant Vale signed a settlement deal on Thursday, Feb. 4, 2021, to pay 37.7 billion reais ($7 billion) to the state of Minas Gerais, following the collapse of a dam two years ago that devastated the city of Brumadinho and killed at least 272 people. (AP Photo/Andre Penner, File)

RIO DE JANEIRO (AP) — Brazilian mining giant Vale signed a settlement deal on Thursday to pay 37.7 billion reais ($7 billion) to the state of Minas Gerais, following the collapse of a dam two years ago that devastated the city of Brumadinho and killed more than 270 people.

The settlement is one of the largest ever realized in the country, Minas Gerais officials said in a statement.

The rupture of the dam at Vale’s iron ore mining complex on Jan. 25, 2019 unleashed a destructive torrent of mining waste, burying the equivalent of 300 soccer pitches under thick mud. Minas Gerais officials said Thursday that 11 people are still missing.

“We know that we have a long way to go and we remain firm in our purpose,” Vale’s chief executive, Eduardo Bartolomeo, said in a statement.

About 30% of the total will go to Brumadinho, with funding for the families of victims, environmental projects and job creation. Some of the settlement money will also finance projects across the state, including public transport improvements and new infrastructure.

Money will also go to riverside communities and farmers whose livelihoods were wrecked in the tragedy. The dam had held back mining waste known as tailings that contained high levels of iron oxide. Some 12 million cubic meters of tailings were released, polluting the nearby Paraopeba River, a major source of water for irrigation and fishing, federal prosecutors found.

One environmental study along the waterway revealed poor water quality, suitable only for boats. According to the report by nongovernmental group SOS Mata Atlantica, heavy metals including iron, manganese and copper were at levels above those permitted by law.

Prosecutors also found evidence that companies knew the mine was operating with “unacceptable” safety conditions. Vale and German auditing firm TÜV SÜD executives face up to 30 years in jail if convicted.

In 2015, Vale was involved in another dam disaster in the city of Mariana, also in Minas Gerais state. In that incident, 19 people died and hundreds were forced to abandon their homes.

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