Five arrested, including three Vale staff, after Brazil dam disaster

[January 29, 2019]  By Gram Slattery and Pedro Fonseca

BRUMADINHO, Brazil/RIO DE JANEIRO (Reuters) - Three employees of Brazilian miner Vale SA and two other engineers working on behalf of the company were arrested on Tuesday, state prosecutors said, deepening a crisis for the company after another deadly disaster at one of its mines.

In a statement on Twitter, Vale said it was cooperating with investigators, who are probing a mining catastrophe that is likely to leave a death toll of more than 300 people. The tragedy has enraged many in Brazil, and raised fresh questions about Vale's commitment to safety after a similar dam collapse at a mine it joint-owned just over three years ago.

Two of Vale's senior managers at the Corrego do Feijao mine - where a tailings dam burst last Friday, drowning the nearby town of Brumadinho in mining waste - were among those arrested, according to the local judge's decision, seen by Reuters. The job of the third Vale employee was not immediately clear.

Two other engineers, who worked on behalf of Vale and are accused of attesting to the safety of the dam, were arrested in Sao Paulo, state prosecutors there said.

Minas Gerais state investigators issued a total of five arrest warrants and seven search warrants, on suspicion of murder, falsification of documents and environmental crimes, the judge's decision showed.

Offers of recompense from Vale SA for one of the deadliest mining disasters in decades have largely fallen on deaf ears.

Chief Financial Officer Luciano Siani said Vale was doing all it could, offering money to mourners, extra tax payments to local government, a special membrane to remove mud from the river and major investments to make its dams safer.

Yet residents in the devastated town of Brumadinho have been unmoved, watching in shock and anger as one dead body after another has been pulled from the mud.

The collapse of the dam in the hilly, pastoral region has caused 65 confirmed deaths so far, according to firefighters' count on Monday night, with another 279 people lost and likely dead.

Coming on the heels of a deadly 2015 tailings dam collapse just a few towns over, at a mine half-owned by Vale, the disaster remained unforgivable in the eyes of many Brazilians.

A view of a dam owned by Brazilian mining company Vale SA after it collapsed, in Brumadinho, Brazil January 29, 2019. REUTERS/Adriano Machado

"Vale is destroying Minas Gerais," said Robinson Passos, 52, who lost a cousin and friends in Brumadinho.

"There's anger, sadness, everything," he said, holding back tears as he surveyed the destruction in Corrego do Feijao, a small hamlet within Brumadinho that gave its name to the mine at the center of the disaster.

Vale CFO Siani said the company would donate 100,000 reais ($26,600) to each family that had lost a loved one, adding the company would continue paying mining royalties to Brumadinho despite a halt in operations there.

The company was building a membrane to stop the flow of mud now snaking down the Paraopeba River. A "bold" investment plan would also speed up the process of making dams more secure, he said.

Prosecutors and politicians have not been impressed.

On Monday, a presidential task force contemplated forcing out Vale's management. Brazil's top prosecutor said the company should be criminally prosecuted and executives held personally responsible.

Mines and Energy Minister Bento Albuquerque said the regulatory model for the mining industry was broken.

In a TV interview on Sunday, Vale CEO Fabio Schvartsman seemed to agree. "We are 100 percent within all the standards, and that didn't do it," he said.

(Reporting by Gram Slattery in Brumadinho and Marta Nogueira in Rio de Janeiro; Editing by Lisa Shumaker, Louise Heavens and Mark Potter)

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