Wrap Text
Update: Samarco
BHP Billiton Plc
Registration number 3196209
Registered in England and Wales
Share code: BIL
ISIN: GB0000566504
NEWS RELEASE
Release Time IMMEDIATE
Date 22 December 2015
Release Number 31/15
UPDATE: SAMARCO
This release provides a further update following the breach of the Fundão tailings
dam and Santarém water dam at the Samarco Mineração S.A (Samarco) iron ore
operation in Minas Gerais, Brazil which occurred on 5 November 2015. BHP Billiton
and Vale each hold a 50 per cent interest in Samarco.
At this stage there are 17 confirmed fatalities, being five members of the community
and 12 people who were working on the dams at the time of the breach. In addition,
two people who were working on the dams remain unaccounted for.
Response & Operations
Samarco continues to work with the government authorities in Brazil to relocate
displaced people from temporary accommodation to rented housing and to distribute
living wage debit cards to those who have been impacted. All displaced people will
have been given the opportunity to relocate before 25 December 2015. Community
access bridges are being rebuilt and public service centres have been established in
affected communities. Planning for the reconstruction of impacted communities has
also commenced.
Monitoring of the remaining dam structures at Samarco continues. Interim work to
repair the damage to the dams and to reinforce parts of the structure continues, with
work on the Selinha dike (which is the wall between the Germano and Fundão dams)
and the Santarém dam being over 50 per cent complete.
Processing and mining operations at Samarco remain suspended.
Legal Proceedings
BHP Billiton’s News Release 29/15 of 30 November 2015 referred to the proceedings
proposed to be commenced by the Federal and certain State governments against
Samarco, Vale and BHP Billiton Brazil for clean-up costs and damages. The action
demanded that the companies establish a fund of BRL 20 billion (US$5.2 billion at
current exchange rates) in aggregate. The plaintiffs also requested certain interim
injunctions. (BHP Billiton Brazil has not yet received formal notice of these
proceedings.)
In connection with these proceedings, on 18 December 2015 the 12th Federal Court
of Belo Horizonte handed down a decision on the interim injunctions requested.
The Federal Court ordered Samarco to deposit BRL 2 billion to a Court-managed
bank account within 30 days. This amount comprises 10 per cent of the total amount
sought by the plaintiffs to be included in the fund. The amounts must be used to pay
for the community and environmental rehabilitation. A daily fine of BRL 1.5 million
applies to Samarco for non-compliance with this deadline.
The Court imposed a restriction in relation to dealings in existing mining exploration
concessions held by Samarco, BHP Billiton Brazil and Vale in Brazil such that those
concessions cannot be transferred or sold by the current holder of the concession.
The Court also ordered Samarco, Vale and BHP Billiton Brazil to undertake certain
remediation actions within specified timeframes. These remediation actions include
preventing leakage of waste from the Fundão tailings dam, engaging a consultant to
evaluate contamination of fish and implement pest control, removal of mud from the
Rio Doce banks, adoption of measures to prevent sludge from reaching the lagoon,
and presentation of a comprehensive plan for environmental recovery and socio-
economic recovery.
Samarco has advised that the work being undertaken by its team and through
external consultants is broadly consistent with the remediation actions ordered by the
Court.
Rio Doce Water Quality
On 15 December 2015, the Brazilian Geological Service (CPRM) and National Water
Agency (ANA) issued a second report in relation to additional sampling and analyses
of the water quality of the Rio Doce. The report supports earlier assessments that the
tailings material is non-toxic. The report states that, after proper treatment to comply
with the potability standards defined by the Brazilian Ministry of Health, the water can
be consumed by the population without any risk. Consistent with earlier studies, the
report also indicates that levels of dissolved heavy metals in the Rio Doce (arsenic,
cadmium, mercury, lead, copper, zinc and others) are, in general terms, similar to
those found in analyses performed by CPRM in 2010.
All communities affected by the dam breach have access to drinking water, with
Samarco having worked with municipal authorities to maintain potable water
supplies.
Appointment of Country Director
BHP Billiton has appointed Flávio Bulcão as Country Director, Brazil, effective
immediately. Mr Bulcão will represent the BHP Billiton team in Brazil, joining the
project support team based in Belo Horizonte, Brazil. He will report to the Chief
Commercial Officer, Dean Dalla Valle, who has assumed day-to-day responsibility at
a Group Management Committee level for BHP Billiton’s response to the Samarco
dam breach. Mr Bulcão has extensive experience in the metals and mining industry,
having held a number of senior executive roles with BHP Billiton in Brazil.
Update on Investigation into Cause
Vale, BHP Billiton and Samarco have jointly engaged New York-based law firm
Cleary Gottlieb Steen & Hamilton LLP to conduct the external investigation into the
cause of the breach of the Fundão tailings dam and the Santarém water dam. Cleary
Gottlieb will draw on expertise in disciplines such as geotechnical engineering and
hydrology. BHP Billiton has committed to release publicly the findings of the external
investigation, and to sharing the results with other resources companies.
Further information on BHP Billiton can be found at: bhpbilliton.com
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