Brazil’s Prosecutor Expected to Seek Criminal Charges over Samarco Mine Disaster

By R.T. Watson | September 2, 2016

Brazilian prosecutors are finalizing a criminal investigation into the Samarco mine disaster and expect to ask a judge by the end of September to charge employees, one of the prosecutors heading the case said.

The investigation is looking into alleged negligence that may constitute involuntary manslaughter charges, along with possible environmental crimes, Prosecutor Eduardo Aguiar said Tuesday in an interview in Belo Horizonte. Samarco, a venture owned by Vale SA and BHP Billiton Ltd., denies wrongdoing.

“We are separating each individual from Samarco to know who had the power to make decisions or avoided making decisions that increased the level of risk of a dam rupture,” Aguiar said.

A panel commissioned by Samarco and its owners found that the Nov. 5 spill resulted from a series of misguided efforts to fix structural defects that hindered drainage and led to liquefaction, with small earth tremors possibly accelerating the process.

No Conclusions

BHP’s Chief Commercial Director Dean Dalla Valle said Monday [Aug. 29] that there was no evidence that anyone put production over safety or reason to believe anyone at BHP had any information that indicated the dam was in danger. Samarco and its owners declined to comment on the criminal case.

The “findings, while answering the technical question of why the dam failed, draw no conclusions on liability and was not designed to,” UBS Group AG analysts led by Glyn Lawcock said in an Aug. 30 report.

The rupture sent billions of gallons of sludge through the Rio Doce valley, killing as many as 19, leaving hundreds homeless and contaminating waterways in two states in what the government described as Brazil’s worst environmental disaster.

The panel’s conclusions didn’t assign blame and, according to Aguiar, didn’t reveal anything new.

The probe indicates that there was evidence that the risk of a dam breach rose in the years prior to the accident, Aguiar said. Samarco’s decision to continue increasing output, rather than halting operations to properly address the growing dam issues, was one of the major causes of the rupture, he said.

While the criminal investigation is focusing on the role of Samarco employees, it may eventually shift to Vale and BHP, whose representatives are on the venture’s board of directors.

“We expect the legal issues to eventually be resolved,” Macquarie Wealth Management said in the Aug. 30 report. A restart of production is expected in fiscal 2018, though “we do not incorporate any cash flow contribution from Samarco in our forecasts for BHP and value it at zero,” it said.

–With assistance from Rebecca Keenan.


Topics Fraud Abuse Molestation Mining

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