Vale in Talks on Payments to Brazil's Dam Disaster Victims -- Update

Date : 01/31/2019 @ 11:05PM
Source : Dow Jones News
Stock : Cia Vale Rio Doce (VALE3)
Quote : 53.8  -1.7 (-3.06%) @ 10:45PM

Vale in Talks on Payments to Brazil's Dam Disaster Victims -- Update

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By Jeffrey T. Lewis and Paulo Trevisani 

SÃO PAULO -- Brazilian mining giant Vale SA hopes to sign a deal with the state of Minas Gerais soon so it can start paying damages to the victims of the collapse last week of a tailings dam owned by the company.

The dam, which burst on Jan. 25, has claimed at least 110 lives, with 238 more missing and feared dead, civil-defense authorities said Thursday.

Vale Chief Executive Officer Fabio Schvartsman said Thursday it is too soon to know how much the damages might amount to. The accident took place in Minas Gerais, and that is where the legal process will play out, Mr. Schvartsman told reporters after a meeting in Brazil's capital with the federal government's top prosecutor, Raquel Dodge.

"We're ready to skip the lawsuits, seeking an agreement as quickly as possible with the authorities of Minas Gerais, allowing Vale to begin the process immediately," he said.

The tailings dam's collapse in the small Brazilian town of Brumadinho released a torrent of muddy mining waste that swept away offices and a crowded lunchroom nearby belonging to Vale. The company has said that most of the victims worked either directly or indirectly for Vale.

Investors and analysts are watching the investigation and the legal process closely to try to determine how much the disaster will cost the company, though it will likely take years to determine the total amount. Vale's shares plunged almost 25% on Monday, the first day of trading after the accident, but have since regained some of that ground.

Brazilians have been riveted by the frequently televised efforts of rescue workers to locate victims' corpses and by the death toll, and the country's lawmakers, regulators and justice system have been quick to propose new legislation, impose fines and investigate the causes of the tragedy.

A spokesman for rescue workers said that locating and identifying the bodies are getting more difficult because the corpses have started to decay and many of them are buried under more mud than the ones they have already found.

The Brazilian government plans to streamline an application process for environmental licenses, Environment Minister Ricardo Salles said Thursday.

Vale has also taken additional actions to give financial aid to families affected by the disaster. The company said earlier this week it would make a donation of 100,000 reais ($27,500) to the families of people who are dead or missing following the dam's collapse, and on Thursday Vale started taking information from family members. The minimum wage in Brazil is 988 reais ($275) a month.

Write to Jeffrey T. Lewis at jeffrey.lewis@wsj.com and Paulo Trevisani at paulo.trevisani@wsj.com

 

(END) Dow Jones Newswires

January 31, 2019 17:50 ET (22:50 GMT)

Copyright (c) 2019 Dow Jones & Company, Inc.


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