Vale's attempt to make amends for deadly Brazilian dam disaster met with anger

Residents devastated by a mining waste dam burst in Brazil that may have killed more than 300 people reacted on Thursday with indifference and in many cases anger to miner Vale SA's pledges to pay victims' families and improve safety.

Mining company has pledged to compensate victims and improve safety

Residents attend an ecumenical service Thursday in memory of victims of a collapsed tailings dam owned by Brazilian mining company Vale SA, in Brumadinho, Brazil. (Washington Alves/Reuters)

Residents devastated by a mining waste dam burst in Brazil that may have killed more than 300 people reacted on Thursday with indifference and in many cases anger to miner Vale SA's pledges to pay victims' families and improve safety.

"Too Late" read newspaper Estado de Minas in the Brazilian state of Minas Gerais, after Vale, the world's largest iron ore miner, said it would take up to 10 per cent of its production offline and spend five billion reais (around $1.8 billion Cdn) to decommission 10 dams like the one that collapsed at its Corrego do Feijao mine last Friday. 

With 110 people confirmed dead and another 238 missing and presumed dead, according to firefighters' count on Thursday evening, the tailings dam collapse in the town of Brumadinho may be Brazil's deadliest ever mine disaster.

In recent days, Vale has vowed to keep paying taxes on the paralyzed mine and donate 100,000 reais ($36,000 Cdn) to the family of each victim.

For some people mourning loved ones, those pledges looked inadequate.

'It's shameful'

"It's shameful for Vale," said Dilson Menezes de Oliveira, 58, who stood looking at the spot where his 32-year-old cousin lies buried after the inn where he was staying was engulfed by a wave of mud and toxic waste. 

"So many innocent people died. And now this compensation of 100,000 reais — it's nothing."

Volunteer Jeferson Ferreira, who helped and saved people in the area from a small hotel that was covered by mud, stands alongside the tailings dam after it collapsed. (Adriano Machado/Reuters)

On Thursday, state labour courts froze more than 800 million reais ($288 million Cdn) of Vale's assets as compensation for victims. That followed court orders over the weekend freezing 11.8 billion reais ($4.2 billion Cdn) in assets to cover rescue efforts and damages. The company, which also operates mines in Canada, had around 24 billion reais in cash and equivalents at the end of the third quarter. 

A ministerial task force convened by President Jair Bolsonaro began drawing up a unified legislative plan to improve safety, oversight and the licensing of dams. 

A person with direct knowledge of the proceedings said the proposals would likely include executive orders and bills in congress and take at least seven to 10 days to prepare.

Health risks

Residents in the devastated town of Brumadinho were still learning of the fallout from the deadly mud flow.

Minas Gerais's state government said on Thursday that initial tests of the Paraopeba River, which was contaminated by the toxic mud, indicated that "the water poses risks to human and animal health." 

It added that locals should not use Paraopeba River water for any purpose. 

On Wednesday, United Nations human rights experts urged an official investigation into the incident. Federal and state prosecutors have already said they are seeking to make the matter a criminal case. 

Three Vale employees and two contractors were arrested on Tuesday.

After a meeting with Brazil's top prosecutor, Vale chief executive Fabio Schvartsman told journalists that he had no reason to think the company's executives would go to prison.

Schvartsman said the company was focused on paying families as soon as possible, and he had also discussed environmental issues with federal prosecutors. He has said the miner built its facilities to code, and equipment had shown the dam was stable.

Israeli military personnel helped search for victims in the toxic mud. (Washington Alves/Reuters)

Chief financial officer Luciano Siani said Vale planned to pay some 80 million reais to the municipality of Brumadinho over the next two years, in lieu of tax payments on the mining operations that had been suspended.

In another setback for Vale, the city of Mangaratiba, in Rio de Janeiro, has temporarily shuttered the company's Ilha Guaiba (TIG) iron ore terminal, CBN radio reported on Thursday. According to the report, Vale was also fined 20 million reais for failing to submit environmental licences.

The company said it had all necessary licences and would take all legal measures needed to resume operations there.