Climate

Historic Environmental Disaster To Cost Mining Company Billions

CREDIT: AP Photo/Felipe Dana

An electricity worker attempts to cross a flooded area in Barra Longa after two dams at an iron ore mine broke in Brazil in November releasing a toxic mudslide that killed more than a dozen people and created the country's largest environmental catastrophe. Mining giant BHP Billiton agreed to pay more than $1.5 billion this week over the accident.

Some four months after the collapse of an iron ore dam caused the largest environmental disaster in Brazilian history, the mining companies involved agreed Wednesday to pay billions of dollars in the coming years to alleviate the devastated region.

“This agreement is an important step in supporting the long-term recovery of the affected communities and the environment,” said Andrew Mackenzie, chief executive officer of BHP Billiton, in a statement. The Anglo-Australian mining giant is joint shareholder of two local companies involved in the pay-out.

Some $1.1 billion will be distributed in the next three years through a foundation that will create programs to restore the environment and indemnify local communities, said BHP. Some $4 billion more will be provided in the next 15 year.

Last November, dams collapsed in the town of Bento Rodrigues, southeast of Brazil, prompting a massive mudslide. The disaster leveled the town, affected two states, killed at least 17 people, destroyed hundreds of homes, left some 250,000 without water, and polluted the Doce River and water reservoirs with at least 15 billion gallons of toxic mine waste.

Analysts have blamed the collapse on poor practices by Samarco, the company in charge of the dam, and lax regulatory enforcement in Brazil’s mining sector, according to published reports.

The Rio Doce valley in Minas Gerais has a long history of mining and is considered to be part of the so-called mining triangle of Brazil. The state is also the country’s foremost producer of coffee and dairy products. For its part, the affected state of Espírito Santo — downstream of the Doce River — is known for its beaches and natural reserves that house endangered species.

Brazilian newspapers reported Wednesday that the Doce River and the beaches of the Atlantic Ocean where the river ends are still struggling with the aftermath. Aside from killing wildlife, the sludge — which included heavy metals like arsenic — destroyed the livelihoods of thousands of people and native communities.

In this Nov. 21, 2015 photo, a fisherman holds a fish over a net in a temporary pool built to protect some of the creatures that inhabit the Doce River from polluted waters, in Colatina, Brazil.

In this Nov. 21, 2015 photo, a fisherman holds a fish over a net in a temporary pool built to protect some of the creatures that inhabit the Doce River from polluted waters, in Colatina, Brazil.

CREDIT: AP Photo/Leo Correa

“Our life was the river, because 80 percent of people here live off it,” said local fisherman Adroaldo Gonçales Filho to El Pais last year. “I just know how to fish … they’ve killed our river.”

The agreement with the the Federal Attorney General of Brazil, Espirito Santo, and Minas Gerais has yet to be approved by the courts, but if that transpires the deal will run for 15 years and it can be renewed for another year until all obligations are fulfilled.

Rural communities in South America have long been affected by environmental catastrophes generated by excessive logging, as well as the extraction of oil and minerals. What’s more, mines and oil wells are often located in the wild, far from populated areas, and away from government regulators that may be lax to begin with. This means that regulations are less likely to prevent accidents, and once those accidents are detected, clean-up efforts are difficult and expensive.