What happened?
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Samarco Mineiracoes, a 50-50 joint venture between Australia's BHP Billiton and Brazil's Vale, operates an iron ore mine in Mariana, in the Brazilian south-eastern state of Minas Gerais where three dams used to hold millions of cubic metres of tailings, or mining waste. One of the dams, its second largest, burst on November 5, unleashing 62 million cubic metres of sludge into the Doce River at about 70km/h. It destroyed the town of Bento Rodrigues, killing at least 13 people (12 are still missing), displaced thousands of others, affected water supplies to an estimated 250,000 people and killed fish stocks along 600 kilometres of river in two states.
Last week, the mud arrived at the river mouth in Espirito Santo state on Brazil's Atlantic coast, endangering protected marine species and polluting beaches at important tourist destinations.
Indigenous people from the Krenac ethnic group have also been affected, with 126 families of the riverside Atora tribe accusing the company of destroying their sacred river. "A lot of people think the river is just water and fish. For us the river is a source of survival and culture. Now the river is dead," Atora chief Leomir Cecílio de Souza told media outlet UOL.
What caused the dam to burst?
It is still unclear what caused the accident. BHP and Vale have said the dams were structurally sound and all paperwork and monitoring was up to date despite existing reports pointing to design faults predating the company's licence extension in September. The companies say those faults did not cause the accident. Official investigations have not yet concluded, but residents of the area and activists are concerned about possible cover-ups, which they say are common in industrial accidents in Brazil.
Is the mud toxic?
This is another point of contention. The United Nations Office of the High Commissioner for Human Rights said in a statement last week that the mining residue "contained high levels of toxic heavy metals and other toxic chemicals". The UN pointed to water tests which it said showed arsenic levels more than 10 times above the legal limit and high levels of mercury.
Other reports by water authorities in Brazil pointed to elevated levels of iron, manganese, aluminium and barium in the water. BHP Billiton, however, has denied this, pointing to its analysis of the metals in the tailings (not the water), which it says are inert and within levels of heavy metals present in any backyard soil sample.
BHP says the dead fish we can see in dramatic footage of riverbeds died of asphyxiation because the sludge blocked their gills, not because of water toxicity.
Municipal councils along the river interrupted water treatment and supplies following the accident, causing grassroots campaigns nationwide to collect bottled water for residents. Samarco also trucked water to the most affected towns, although some of its supplies were rejected due to kerosene contamination, possibly in the water trucks. BHP says Samarco has provided water treatment plants with the correct chemicals to treat affected water supplies. Some municipalities have said the water is again good to drink, but residents are objecting to its cloudy colour and foul smell.
What's being done about it?
Samarco, which has been fined 250 million Brazilian reals ($92 million) by Brazil's environmental watchdog, IBAMA, has agreed with the Brazilian government to put R$1 billion ($366 million) into a preliminary fund for compensation and clean-up costs, and risks additional daily fines of R$10 million ($3.7 million) if does not take steps to mitigate the ecological damage. BHP says it and its partner, Vale, will do everything necessary to assist affected communities – they have provided temporary accommodation, rented houses for people whose homes were destroyed and provided clothing and supplies – and to restore the environment.
A number of official government inquiries have begun, including one by the Brazilian indigenous institute FUNAI and Senate. On Thursday, that inquiry called on Samarco president Ricardo Vescovi to appear before it to answer to the effects the accident has had on indigenous people.
Following the accident, Mr Vescovi obtained a habeas corpus (a writ) to prevent his possible arrest in conjunction with investigations.
The Brazilian government says it will ensure accountability and transparency, but embattled President Dilma Rousseff enjoys little credibility with the majority of the population who accuse all levels of government and the corporate sector of corruption.
What did it do to BHP shares?
BHP shares were already being punished before the Samarco disaster, as investors weighed up slowing demand in China and the growing possibility that BHP can no longer afford its generous dividend payments to shareholders. Since the peak of the mining boom in February 2011 to the day before the Samarco tragedy, BHP shares had roughly halved to $23.28.
Samarco is not traditionally an important part of BHP's business, accounting for about 1 per cent of its revenues, but with cash already tight, investors fear the company could get hit with big fines and clean-up costs. The company has already committed about $500 million to those efforts, and many expect the cost to rise significantly. When added to existing concerns about China and the dividend, the incident prompted BHP shares to gradually collapse; the stock has fallen 19 per cent in the space of three weeks to levels not seen since October 2005.
Will the mine ever resume operations?
Samarco had its licence to operated suspended by local authorities in the days after the disaster. Upon suspending the licence, the state deputy environment secretary Geraldo Abreu warned that he may never give it back. "The company will need to make a number of changes before we allow them to begin mining again," he said. With the iron ore market in oversupply, many analysts thought BHP and Vale may never seek to revive the operation. But some of the affected local people made it clear at community meetings that they wanted the mine to eventually return.
The town most affected, Bento Rodrigues, was mostly inhabited by Samarco workers, who faced a double hit if their jobs were to disappear. "The mines are our only recourse. If you do away with the mines, Mariana is finished," Jordan Sacramento, who lost his home, told Fairfax Media. While they have not named a date, BHP and Vale have said in recent days they want to resume operations at the mine eventually. "There should be no doubt that our desire is to get it back to being a good business again and we are committed very much to the long term," BHP chief Andrew Mackenzie said.