BHP approves $US44 million funding for Samarco restart

Image: ICMM

BHP is backing a restart of operations at the troubled Samarco Mineração iron ore joint venture (JV) with Vale in Brazil through a significant investment.

The mining giant has approved $44 million ($63.9 million) for its share of funding for the restart, which is scheduled to take place by the end of 2020.

BHP’s funding will enable the construction of a filtration plant over the next 12 months, and the commencement of operation readiness activities for restart.

The new filtration technologies will increase safety, “a key principle that guides our work for Samarco’s recovery and operations,” according to Samarco chief executive Rodrigo Vilela.

BHP said the restart could occur when the filtration system was complete and when Samarco had met all necessary safety requirements.

Once Samarco has implemented its new technologies including the filtration system, it would restart its iron ore extraction and beneficiation plants in Germano and the pelletising plant in the Ubu Complex in Anchieta in the state of Espírito Santo.

Samarco is expected to initially produce around seven to eight million tonnes a year, and to reach around 14-16 million tonnes within another six years.

Within around 10 years of the licence issuance, Samarco aims to produce 22–24 million tonnes a year.

Samarco has obtained all environmental licences required to progress towards operational restart. This, however, will be subject to final approval by Samarco’s shareholders.

Operations at Samarco were suspended following the failure of the Fundão dam in November 2015.

Nearly four years later, the Mining Activities Chamber of the State Council for Environmental Policy in Minas Gerais has granted the Corrective Operating Licence for Samarco’s operating activities at its Germano Complex.

BHP holds a 50 per cent interest in Samarco via BHP Billiton Brasil, with the remaining 50 per cent held by Vale.

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