This text was originally published by Brio, in Portuguese. It was translated by Gustavo Ribeiro and edited by Christine Bootes
Chapter 3 – The Origins of the Disaster
Forty years prior to the devastation of the Mariana Region, government negligence opened a breach that would result, decades later, in the collapse of the dam – Brazil’s worst environmental disaster, ever. Dozens of authorities had the opportunity to disarm that ticking time bomb but systematically failed to do so.
During the 1970s, Brazil was going at full steam. The dictatorial government of General Ernesto Geisel (1974-1979) wanted to place the country, at all costs, on the world map of industrial development to help dig Brazil out of the severe economic crisis that had hit us back in the 1960s. His predecessor, General Emílio Médici (1969-1974) had already set in motion some projects – they became known as the “pharaonic projects” – which included a road crossing the Amazon.
Back then, the Constitution and the Federal Mining Code – both approved in 1967— legitimized the “first come, first served” logic regarding concessions to the exploitation of Brazil’s mineral resources. The legal framework at the time guaranteed the rights to extract from mineral deposits to the first company to request it from the National Department of Mineral Production (DNPM).
Environmental hazards were hardly a priority during these decades. At that time, the country didn’t even have a legal definition of the word “environment.” The Federal Mining Code was limited to punishing mining companies that caused “damages to third parties” as a result of their activities. It also demanded the “safety and sanitation of the houses in the companies’ premises,” and forbade the pollution of air and water.
If a company could prove that undertaking mining would be economically viable, then it was almost sure to obtain the license. The only obligation would be paying for the land – when necessary. Simple as that. “At the time, the focus was on stimulating Brazilian growth, and environmental questions were not a priority,” explains Valmor Bremm, a lawyer specialized in mining law.
That loose regulation allowed Samarco to set up business in a region between the cities of Mariana and Ouro Preto, and to build a residue dam in a district of Mariana, just 11km away from the small agglomeration of Bento Rodrigues. This is what mining experts refer to as a “geographic fatality,” explains Alberto Fonseca, a professor and researcher in mining and environmental issues at the Federal University of Ouro Preto. When mineral beds are concentrated in a specific region, the exploitation must occur in that same area or else it won’t be economically viable.
When Samarco came to the region, it brought thousands of new jobs – the kind of development that the dictatorship craved so much. Instead of the traditional use of trucks to transport iron ore, Samarco was a pioneer, introducing the use of pipelines to drain its production. This came with many advantages, for sure, including a reduction in carbon dioxide emissions (CO2, a greenhouse effect gas). But it consumes huge quantities of water, essential for the iron ore to slide inside the pipelines in the form of a sticky mud.
The exploitation process also produces huge amounts of residues, a sandy mud with no commercial value. As Samarco increased its production, it also increased the amount of residue it had to deal with – hence the creation of large dams for storage. The company decided to build the gigantic Germano dam, with the capacity for holding 200 billion liters of residue. The singing of local birds was abruptly replaced with the noises of machinery, disturbing the neighboring populations without any regard.
“We were never asked about it,” recalls Ana Luiza Messias, 64, who has lived in Bento Rodrigues since 1966. She remembers the countless nights when she was unable to sleep due to the weird noises coming from the dam – noises that sounded like planes, or helicopters. Above all, she was afraid that big dam would eventually collapse – but what other solution did she have, other than to just keep sleeping next to the “enemy”? Back then, Messias remembers, Samarco’s representatives frequently knocked on people’s doors with offers to buy their land; most of the residents refused.
While Samarco was harassing the locals, the company, in turn, was being harassed by Vale. In 2000, the Brazilian giant would come to an agreement with the Belgo Mineira company to buy 63.06 percent of the shares of a mining company named Samitri – including 51 percent of its subsidiary Samarco. The deal was confirmed for 971 million BRL. Simultaneously, Vale sold 1 percent of Samarco’s shares to Anglo-Australian BHP Billiton (which already held 49 percent of the company’s shares). From that point on, BHP Billion and Vale started to exercise shared control of Samarco.
New management pushed for better results, and Samarco’s iron production rose 22 percent after only one year. At that point, the company had already inaugurated a second dam, Santarém, capable of containing 6 billion liters of water – an essential resource for mining exploitation and product transportation. But for the rising production, a third dam had to be built. The Fundão dam would be inaugurated in 2007, with a capacity to hold 55 billion liters of iron ore residue, i.e. one-quarter of the Germano dam.
That new site ignited protest from social movements and the dangers of having iron ore residue nearby were evoked. Those groups would have reason to be fearful: by 2008, the state of Minas Gerais had recorded a total of four dam collapses.
The first dam collapse, also the, worst, occurred in 1986 in the Fernandinho Mine. It killed seven people and left a trail of mud in the Rio das Velhas river. In 2001, the collapse of a dam that today belongs to Vale took the lives of five people and destroyed hydric resources and vegetation. Two years later, there was a leak of 900 million liters of industrial residue – a thick black liquid of lignin and sodium – in the region of Cataguases. And in 2007 and 2008, another mining disaster spilled over 2 million liters of bauxite mud that flooded two cities.
There was plenty of reason for concern.
Under pressure, Samarco started once again to harass residents into selling off their property – a way to get them out of the neighboring land. Ana Luiz Messias recalls seeing guys in uniforms more and more often, and offers were becoming more and more generous. One of these offers was so high that it convinced a family to sell a property that had been in the family for 40 years. The initial plan was to transfer the whole village to another area, but most people stood their ground – literally. After a while, Messias remembers, the company gradually backed off.
A region devastated by the dam collapse
A Bright Future Ahead
In 2012, Samarco was celebrating its success: it had received Company of the Year Awards, saw record monthly production numbers (21 million tons of iron ore), and the tenth place among Brazilian exporting mining companies with a turnover of more than USD 2 billion. But CEO Ricardo Vescovi wanted more.
He signed a letter declaring the company’s ambitious goals for the upcoming decade:
Doubling Samarco’s value until 2022, and getting the recognition – from employees, clients and the Brazilian society – as the best in the business. Samarco is fully in expansion mode, responsible for the biggest private project in the Brazilian mining sector to be in construction at this moment. With investments of USD 1.54 billion, we will increase our production by 37 percent, from the current 22.35 million tons to 30.5 million tons of iron per year.
Ironically, the letter assured that the company’s future growth was built on solid grounds.
We are sure to have the proper grounds to sustain us today, and the potential to innovate – which will ensure our mid and long-term success.
Increasing production capacity by 37 percent also translated into more iron ore residue. To achieve the goal, it would be necessary to either create more space for it, or to increase the capacity of existing dams. Through the years, the Germano and Fundão dams received arrangements and modifications to reinforce their structures, all without passing it through environmental control institutions.
Without the proper conditions to inspect all dams in Minas Gerais, the State Environmental Foundation declared in 2005 that all mining companies would be required to hire independent audit firms to evaluate the stability and safety of their enterprise. Periodicity is defined by the risk rating of each. In Samarco’s case, reports should be sent annually.
In 2012, an audit report stated that the Fundão dam offered “adequate safety conditions” and had its “stability assured by the auditor,” but nevertheless, Samarco would need to follow nine recommendations for improvement. Among them was the installation of new monitoring tolls, and calibrating the equipment draining the dam. Noises of trucks and of water “running like a river” became part of the daily life of residents of Bento Rodrigues.
The following year, Samarco filed for the renewal of the environmental license of the dam. It wanted to increase the dam’s height by another 60 meters. It would not only help manage increasing production but also connect Fundão to the Germano dam. The request was met with resistance from José Miguel Cota, then-Secretary of Environment of Mariana.
In an audience with Cota, Samarco representatives brought along with them a large dossier filled with studies and documents from the dams to defend their project. It was the best solution to the city, they claimed, but Cota wasn’t so sure. The men from Samarco explained that there was no place for a new dam, not to mention that a new one would mean the deforestation of a whole new area – causing even more environmental impact.
Cota asked for more time to think about the issue. Talking amongst his staff, he found himself to be the sole voice of opposition to an enterprise with such an established presence.
Samarco would also meet with the mayor at the time, Celso Costa Neto. Some time later, Secretary Cota would sign the renewal of the license, giving Samarco a green light on the new project without following typical procedures. Normally, Cota would need to submit the project to the Municipal Council of Environment and Development; however, he signed the document on his own, concluding Samarco’s first battle with Brazilian bureaucracy. Now, it was time to tackle state agencies and convince them that an expansion wouldn’t be hazardous to the region.
Once again, Samarco’s lawyers gathered piles of documents and sent them to different environmental regulatory agencies. An audit report hired by Samarco stated that the Fundão structure was safe, albeit some fissures were found. Ensuring the dam’s stability depended on the company following six new recommendations, including reparations of the fissures and updating their safety chart. Auditors asked the mining company to continue recording any “anomalies” identified during the visual inspection and to periodically monitor the Fundão dam. The State Environmental Secretary then issued a recommendation for the approval of Samarco’s license. The final decision was left up to the Environmental Council.
Meanwhile, State Prosecutor Carlos Eduardo Ferreira Pinto had asked the Prístino Institute, a non-profit organization specialized in environmental inspections, for an independent report. Only after this report would Pinto declare his opinion on the matter. Technicians from the Instituteexamined the dam and compiled an in-depth report on the matter, far more detailed than that of the firm hired by Samarco. This new report expressed various safety concerns, and among them, it pointed out the increased risk for erosion should the two dams be connected.
On October 24, 2013, with the report in his hands, Ferreira Pinto wrote a recommendation conditioning the license renewal to a series of measures that needed to be adopted by Samarco. Among the most important was a contingency plan in case of danger or accident – especially concerning the community of Bento Rodrigues. And yet despite all of these red flags, the renewal was approved by the Environmental Council on October 29, 2013. Two members of the board abstained – and all the others voted a unanimous yes.
With this obstacle overcome, Samarco began to face a new challenge standing between the company and its future goals: the iron ore crisis. Prices took a nosedive worldwide due to a decreasing demand from China. And besides, Samarco now had to compete with Australian companies, which began offering iron ore at lower prices.
At that moment, Samarco decided to implement a cost-reduction, production-increasing program. Between 2013 and 2014, the production of iron ore increased by 15 percent – adding another 5.5 million tons of sandy mud residue. To offer a bizarre comparison, Samarco was producing the weight in residue of over 5 million elephants in just 2014.
Independent auditors checked the premises once again. The dams were still approved – but the list of safety recommendations grew bigger: there were now 11 problems to correct. And three of these points had already been raised during the 2013 audit, like the repair of fissures and the update of the safety chart.
In 2014, Samarco celebrated the conclusion of its expansion plan. According to its own sustainability balance, USD 1.82 billion was dedicated that year solely to increase the company’s production levels – to keep up with the production goals set by the plan. However, investments to avoid – or minimize – damages to the environment (hydric resources, atmospheric emissions, and the administration of residues) were only USD 25 million, or 1.38 percent of the investment for 2015.
In yet another cost-cutting move, in August 2015 Samarco decided to remove the high precision sensors that would detect any alteration in the dam. In the case of a collapse, the alarms on these sensors would sound, thus alerting employees to employ emergency measures. Each sensor cost USD 35,000. But the company, to avoid sending the message that the removals of the sensors would make its dams less safe, hired a team that October to create a promotional video on the benefits that the dam complex brought to the locals.
Another external audit report that same year, from a team hired by Samarco, stated that the Fundão dam was in “adequate conditions of safety” – but included a caveat, “as long as the company follows the list of recommendations regarding its physical stability.” This time, there were twelve items on that list. Samarco was asked once again to check for possible problems in the dam’s structure, to repair fissures, to monitor the water flow, to update their safety chart. All of these items had been mentioned in the previous reports.
The deadline for those corrections was extended through 2016, but it didn’t matter. In November 2015, the collapse took place.
