When disaster strike again

At the end of 2015 news broke of a mining disaster in the Brazilian state of Minas Gerais that sadly took the lives of 19 people and destroyed the village of Bento Rodrigues near the town of Mariana, and not far from the picturesque and historic town of Ouro Preto.

A dam that formed part of the mining operations owned by Samarco (jointly owned by Brazil’s Vale and Australia’s BHP Billiton) had ruptured sending tons of toxic sludge down the valley, into the Rio Doce, destroying all in its path.

In that incident, 19 people, considered a high and unacceptable number, lost their lives while the toxic water eventually spilled out into the sea causing devastation for hundreds of miles up to the Atlantic Ocean.

Costly investigations ensued. A significant penalty was imposed on the companies involved.

Just a few days ago another dam, at Vale’s Brumadinho mine in Minas Gerais, ruptured in a similar fashion. The death toll is already five times higher than that of the Mariana incident, about 110 confirmed so far, with 238 as yet unaccounted for. Fortunately, some survivors have been found or rescued. The numbers change as the clock ticks but the likelihood of finding anyone alive now after a week is sadly¬†very low.

TV reports had shown staff on the dam running panic-stricken to reach safely – not all were lucky. The majority of those that died were employees of Vale.

The bank accounts of the company have been frozen while several employees have been arrested. Investigations are underway and while the environmental damage may not be as bad as that of the Mariana incident, the human impact is significantly worse. This is clearly an enormous tragedy but one that, it seems, could have been averted by taking action years ago.

There are several thousand dams throughout Brazil and the lack of maintenance on many of these is of concern.

These two cases (as well as the collapse of a Sao Paulo bridge at the end of last year) highlight the true cost of failing to conduct proper maintenance. All entities, be they small local municipalities or major corporations, with engineering structures under their responsibility, will doubtless wrestle with the financial decisions associated with fixing issues. Costs are costs, but some can be deferred while others need to be dealt with urgently.

As the adage goes “A stitch in time saves nine”. If applied in these cases a million dollars or more spent earlier would have averted a significantly bigger cost: in lives, in fines, in share price and reputation, and in cleaning up the environment. Risk management clearly failed on these occasions. Perhaps on the part of the government as well as the companies involved. The investigation will shed light on the matter – hopefully, faster than in the Mariana case. In the meantime, the families of those who died, or who have yet to be found, are suffering.

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