Brazil’s Vale to dismiss CEO after fatal dam burst -source

RIO DE JANEIRO, (Reuters) – Brazilian iron ore miner Vale SA is dismissing Chief Executive Fabio Schvartsman, as well as several other high-ranking employees, a source with direct knowledge of the matter told Reuters yesterday, after one of its mining dams burst in January killing hundreds.

State and federal prosecutors had earlier in the day recommended the “immediate removal” of Schvartsman and three other executives from “any functions or activities” at the firm.

Investigators also recommended the removal of Vale’s head of ferrous minerals and coal, Peter Poppinga, planning director Lucio Flavio Gallon Cavalli and Silmar Magalhaes Silva, the head of a geographic division at Vale, as well as three managers and two technicians.

According to the source, who requested anonymity because the matter has not been announced publicly, Vale’s board decided to follow prosecutors’ recommendations, meaning all of the people will be dismissed.

Newspaper Estado de S. Paulo first reported on the board’s decision.

Vale did not immediately respond to a request for comment.

The move comes slightly over a month after a tailings dam broke at Vale’s Corrego do Feijao mine in the interior Brazilian state of Minas Gerais, likely killing over 300 people and releasing massive amounts of toxic sludge.

It was the second deadly burst at a Vale-linked tailings dam in Minas Gerais in four years.

In the weeks since the burst, documents have emerged showing that Vale knew the dam had an elevated risk of rupture and that inspectors felt they were under pressure to certify the structure as safe.

This week, Folha reported that a Vale manager had told executives that the integrity of the structure had worsened, though the company vigorously denied the report.