BHP Billiton says a restart to production at the Samarco iron ore joint venture with Vale in Brazil is possible next year, but only if several hurdles are overcome first.
Samarco has been closed since November 2015 when a tailings dam failure caused flooding that killed 19 people, as well as extensive environmental damage. Design and construction flaws were blamed for the disaster.
The joint venture partners have submitted licencing applications to Brazilian authorities for a restart to operations at reduced capacity, BHP said in a statement.
“A restart of operations is technically feasible in 2017, however, restart will occur only if it is safe to do so and the necessary approvals are received from Brazilian authorities,” BHP stated.
“A restructure of Samarco’s debt that enables Samarco to be economically viable is also required to allow Samarco to move forward.”
The Samarco joint venture missed a payment on an outstanding bond issue in October and must refinance the operation to return it to production.
Samarco also faces several civil claims resulting from the social, environmental and economic impact of the dam failure.