02.13.2019

Vale CFO says miner’s top managers were unaware of dam risk report

Marta Nogueira

– by Marta Nogueira (Reuters Canada – February 12, 2019)

https://ca.reuters.com/

RIO DE JANEIRO (Reuters) – Senior management at Brazilian miner Vale were never shown internal security documents indicating that its dam at Brumadinho was at risk of collapse, the company’s chief financial officer said on Tuesday.

The CFO, Luciano Siani, was asked about management’s knowledge of the internal documents at a news conference a day after Reuters reported on them. The documents, dated Oct. 3, 2018, classified the dam at Brumadinho as being two times more likely to fail than the maximum level of risk tolerated under internal guidelines.

The dam collapsed in late January in one of the deadliest mining disasters in decades. Asked whether the company’s senior management had seen the internal report, Siani said, “No.”

“There was a lot of controversy about this recommendation to pass technical details to senior management,” Siani said at the company’s headquarters in Rio de Janeiro. “If a mechanic and a pilot detect a problem, they have to have the autonomy to take immediate decisions in the field, and if you scale that into the company hierarchy, it can mean the difference between taking a quick decision and not.”

The disaster in the mineral-rich state of Minas Gerais was the second major collapse of a mining dam in the region in about three years, following a similar disaster in 2015 at a nearby mine co-owned by Vale.

For the rest of this article: https://ca.reuters.com/article/businessNews/idCAKCN1Q12MC-OCABS