A year to forget for BHP as deaths mount

An electricity worker attempts to cross a flooded area in Barra Longa after a dam burst on Thursday in Minas Gerais state, Brazil, Saturday, Nov. 7, 2015. Brazilian searchers are looking for 23 people still listed as missing following the burst of two dams at an iron ore mine in a southeastern mountainous area. (AP Photo/Felipe Dana)

BHP Billiton has assured cost cutting won’t affect future safety following the Brazil mine disaster. (AAP)

The world’s biggest mining company BHP Billiton has given assurances that cost cutting won’t affect future safety as the death toll mounts in Brazil.


It’s a year that BHP Billiton would rather forget.Lives have been lost, a village has been wiped out and shares in the world’s biggest miner are at 10-year lows.

As the death toll from the Brazilian mine disaster reached at least 10 this week, BHP executives tried to provide some insight into the tragedy which has disrupted the lives of thousands of people and covered their region in mine waste and mud.

A dam burst at the Samarco iron ore mine in Mariana a fortnight ago, unleashing a torrent of muck onto the nearby village of Bento Rodrigues and contaminating drinking water in the region.

In addition to the mounting death toll in Brazil, where eight people remain missing, five BHP employees have lost their lives during the 2015 financial year worldwide.

The death toll has weighed heavily on the executives who have apologised repeatedly in recent weeks.

While weaker commodities prices have forced BHP to slash costs in recent years, the company’s chief executive Andrew MacKenzie gave assurances on Thursday that cost reductions would not affect safety into the future following the Samarco disaster.

Mr Mackenzie told reporters that BHP aimed to ensure its tens of thousands of employees always chose safety over productivity.

“I strongly believe that the way we simplify and make this company more efficient, it actually enhances safety, enhances the health of our workforce,” he said.

Chairman Jac Nasser said the drivers of good safety were also the drivers of good productivity.

“There should not be a trade-off,” he said.

But environmental groups say BHP hasn’t learned from previous tailings dams failures such as the Ok Tedi environmental disaster in Papua New Guinea (PNG) which destroyed villages and disrupted the lives of thousands.

Mr Mackenzie said BHP had created a fund for the clean-up and development in PNG, and it added that it intended to continue its Samarco business.

“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,” Mr Mackenzie said.

CMC Markets chief market strategist Michael McCarthy said the company’s shares had lost around a third of their value this year and were just off ten year lows.

“It’s been a tough year,” Mr McCarthy said.

But he said low commodities prices and a potential change to the company’s dividend policy were now factored in to the company’s share price.

Shares in the company closed eight cents higher at $20.50.

Analysts estimate the Brazilian disaster will cost BHP around $1.2 billion over three years.

Still, no one is sure whether the affected areas can be rehabilitated and rebuilt.

One of Brazil’s major river systems, Rio Dolce, remains at risk as the mine waste continues to flow towards the Atlantic Ocean, destroying crops and killing fish.

BHP Billiton plans to publicly release the findings of an external investigation into the Samarco disaster.

1 Comment

Filed under Environmental impact, Human rights

One response to “A year to forget for BHP as deaths mount

  1. Senta

    No mine is safe and wealth is minimally if at all spent on community welfare.

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