- Samarco seeking to resume iron mining to help pay bills
- Miner still needs federal and state government clearance
For BHP Billiton Ltd. and Vale SA’s joint venture in Brazil, it’s a case of one down, two to go as the stalled mine seeks approvals to resume operations.
The Mariana municipal government cleared Samarco Mineracao SA’s bid to return to 60 percent of full production this year after a November tailings dam collapse killed as many as 19 people and contaminated waterways, Harley Pinto, a spokesman for the company, said by telephone Tuesday.
The iron-ore mine still needs federal and Minas Gerais state government approval for the restart plan. The company is striving to generate funding for an agreement to pay about 12 billion reais ($3.4 billion) over 15 years to clean up damage caused by the disaster and assist victims. As part of a March settlement with the government, Samarco agreed to pay 4.4 billion reais in compensation over the next three years. The settlement was ratified by a court this month.
Concern that a separate lawsuit and regulatory barriers will erode its ability to pay debt is making Samarco’s bonds due in 2022 the worst performers in the world among mining and metal company notes, with a 28 percent slump this month.
Samarco will have to reduce some staff it has kept on since November, it said in a statement Tuesday. About 1,200 people probably will be cut, a union official said in by e-mail.