BHP Billiton today provided an update on the recovery and response effort following the breach of the Fundão tailings dam and Santarém water dam at Samarco’s iron ore operations in Minas Gerais, Brazil, in November 2015.

Renova Foundation

The Renova Foundation (Foundation) was incorporated as a private foundation by Samarco Mineração S.A (Samarco), BHP Billiton Brasil LTDA (BHP Billiton Brasil) and Vale S.A. (Vale) in June 2016 to deliver all the environmental and socio-economic programs under the Framework Agreement and became operational on 2 August 2016.  

The Renova Foundation is a not for profit, autonomous foundation and receives its name from a Portuguese term meaning ‘Renew’.  Internal governance for the Foundation includes a Board of Governors, along with a Fiscal Council, Advisory Council, and Ombudsman.  The Advisory Council will include representation from impacted communities and community development and education experts.  

The Foundation will also be overseen externally by an independent Inter-Federative Committee comprised of 12 representatives from Brazilian government who will advise and ultimately assess the progress of remediation and compensation projects outlined in the Framework Agreement and delivered by the Foundation. 

Roberto Waack has recently been appointed as Chief Executive of the Renova Foundation. He is a biologist with an extensive background in sustainability-related civil society organisations including World Wide Fund for Nature (WWF) Brazil, Global Reporting Initiative, Forest Stewardship Council, Ethos Institute and the Brazilian Biodiversity Fund.

Dam Remediation

The Framework Agreement outlines works necessary to ensure the integrity of impacted dams and progressively restore water quality in the river system.  Works are underway by Samarco on the dam structures to contain the remaining tailings materials and to treat sediment between the Fundão Dam and the Neves Risoleta Hydroelectric Plant. This work is scheduled to be completed by 31 December 2016.

Samarco’s repairs to the base of the Germano dam are complete and construction of the New Santarém dam and the restabilisation of a number of dykes remain on schedule for completion by the end of October 2016. The Germano dam and Santarém water dam are subject to ongoing real-time radar, laser, camera and water level monitoring. 

River recovery and restoration is a long-term process requiring remedial intervention over a number of years followed by natural adjustment of the river system and ecosystems. The wet season is expected to start in coming weeks and the level of river turbidity and orange colour in the river is predicted to increase, despite preparatory work undertaken to stabilise and treat turbidity and sediment movement.  The integrated wet season preparation is focussed on stabilising the remaining material in the Fundão Dam and along the river banks, intercepting sediment flowing in the river using dykes and dredging, and treating turbidity within the river using flocculation, and the revegetation of over 800 hectares of impacted river margins. 

Technical studies and monitoring continue to be carried out in parallel to the wet season preparation to help inform the management of the tailings along the river.

Water quality and fish health

A geochemical study was commissioned by Samarco and has been undertaken by external consultants to determine the composition of the tailings that had been deposited throughout the river system and how the tailings would behave chemically over time.  Consistent with earlier studies, the latest results indicate the tailings are an inert mix of sand and clay materials, and have low concentrations of metals of environmental and health concern. Water quality sampling and ecotoxicological testing has confirmed the chemical nature of the tailings with no evidence of metals of concern or toxicological effects being observed. These results have been presented to the environmental regulator Instituto Brasileiro do Meio Ambiente E Dos Recursos Naturais Renováveis (Brazilian Institute of Environment and Renewable Natural Resources or IBAMA).

Two surveys of fish by Samarco using hydroacoustics (sonar) have been conducted along reaches of the river. Both surveys identified the presence of fish in all areas studied with experts concluding that it was likely that repopulation of river fish stocks was being complemented by stocks in the tributaries. The results of these surveys have been supported by anecdotal evidence from local fisherman. Comprehensive plans for monitoring fish and other aquatic species have been submitted to environmental regulators.

The levels of turbidity continued to improve over the last few months during the dry season. The latest monitoring shows all points downstream of Governador Valadares are below 30NTU (Nephelometric Turbidity Unit) which is the same as historical levels and less than the regulatory standard of 100NTU. There are localised levels of higher turbidity downstream of Candonga Dam due to dredging of tailings.  The localised higher turbidity levels are expected to continue throughout the dredging program which is subject to a monitoring program and turbidity limits authorised by the environmental regulator.

Resettlement

The Foundation is required to relocate and rebuild Bento Rodrigues, Paracatu and Gesteira in consultation with the affected communities. The program includes the identification and acquisition of land, design and planning for the urban development including all services and reconstruction of public buildings (schools, health centres, squares, covered sports grounds and religious buildings). 

The Framework Agreement requires a negotiation by way of participatory forums to determine the best location for each redevelopment. As part of this process, residents collectively developed criteria for potential locations and applied these criteria to agree three options from a larger list of possible locations. They visited the mapped terrain of the different relocation options, viewed 3D videos and received booklets containing information such as soil quality, water, geology and vegetation.  In addition, residents saw models of each of the location options, to better assess different areas. 

All three communities have identified their new locations through a voting process conducted by the communities and overseen by Ernst & Young. On 7 May 2016, 92 per cent of the Bento Rodrigues families voted for Lavoura as their chosen area; on 25 June, 95 per cent of the smaller Gesteira community voted for an area called Macacos; and on 3 September, the Paracatu de Baixo community chose the Lucila area as its preferred location. This was a closer result with 65 per cent of votes for Lucila and 32 per cent for a nearby area called Toninho.

In line with a request from the Mariana Public Prosecutor, technical advice is being provided to impacted families during the resettlement process through the faith-based NGO, Caritas. The next step is to undertake urban planning activities with the communities.

Compensation and financial assistance

Over 10,000 financial assistance cards have been issued to date by Samarco to members of the Mariana and Barra Longa communities (which are close to the mine), communities along the Rio Doce and those near the coast in Minas Gerais and Espirito Santo, where fishing based livelihoods were prominent prior to the dam failure. 

Samarco has provided advance compensation payments to families who lost relatives (BRL100,000), those who lost their house (BRL 20,000) and those who lost their cars (average market price). All advance payments were implemented without requiring legal releases, or imposing any form of conditions on affected families. A total of 282 families have received advance payments.

An extensive Coordinated Negotiation Program is about to commence with a team of 300 people located in 20 communities. Feedback has been sought from public attorneys, local judges, technical entities and impacted families during a series of dialogue sessions. The Program has been approved by the Inter-Federative Committee and accepted by these stakeholders. 

Cause investigation

Vale, BHP Billiton Brasil and Samarco jointly commissioned Cleary Gottlieb Steen & Hamilton LLP (Cleary Gottlieb) to investigate the immediate cause of the failure. To assist with the investigation, Cleary Gottlieb retained a Panel of four geotechnical specialists to advise on the technical causes of the failure.

The findings were publicly released on 29 August 2016 in Belo Horizonte and a full overview of the Panel’s findings, explanatory materials, detailed modelling, input data, video and technical diagrams can be found at: 

fundãoinvestigation.com

BHP Billiton believes that sharing the Panel’s findings will build a deep technical understanding of what happened and will help the industry improve its ability to prevent similar events.    

BHP Billiton also undertook a review of significant dams in its portfolio.  The review concluded that the dams are stable and a number of enhancements to existing processes around management of dams were announced.

Samarco continues to provide regular updates on the recovery and remediation efforts outlined above which can be found online in English and Portuguese.