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BHP says five dams pose ‘extreme risk’ in case of collapse

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BHP Group, the world’s largest miner, says it has five tailings dams that are at “extreme risk” of damaging the local environment and harming nearby residents if they failed.

The Anglo-Australian group unveiled the results of a risk assessment into its dams on Friday after growing pressure from institutions and investors in the wake of two fatal accidents in Brazil that have left hundreds dead, one of which was a joint venture run by BHP.

In April, a group led by Church of England Pensions Board, which is working on a global standard for tailings dams, wrote to almost 700 mining companies, including BHP, demanding the publication of information on every facility they control.

In addition, the International Council of Mining and Metals, an industry group whose members include BHP and 26 other miners, started work on a new set of standards for tailings dams, which are used to store waste material from mining.

The industry needs to avoid another deadly dam burst otherwise it risks becoming uninvestable for many investors.

BHP’s risk classification is based on the impact on the environment and local people from a hypothetical failure rather than the current stability of the dam, the company said in a presentation. It follows standards drawn up by the Canadian Dam Association.

The miner said a further 16 tailings dams it operates were classified as having “very high” risk of damage in the case of collapse.

But it said it had a “range of controls” to manage the risks of its tailings dams, from governance to monitoring and surveillance.

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“The overall outcome of the review was that there were no immediate concerns regarding dam integrity,” BHP said.

The review was undertaken following the 2015 collapse of a tailings dam in Brazil’s Mariana village that left 19 dead. Samarco, the operator of the mine and dam near Mariana, was a joint venture of Vale with BHP Billiton.

In January the collapse of a tailings dam at Vale’s Córrego do Feijão iron ore mine in southeastern Brazil unleashed a tidal wave of sludge that killed 231 people.

BHP’s chief executive Andrew Mackenzie said in February that the industry didn’t have a complete understanding of tailings dams and why they collapsed and needed to invest in further research.

BHP said that closed tailings dams account for over half of dams that pose a risk rated very high or extreme.

“Given these facilities are inactive, their most probable failure modes generally arise from environmental factors including extreme precipitation and extreme seismic events,” it said.

Four of the extreme-rated dams that BHP operates are in Australia while one is at its Escondida mine high up in the desert in Chile.

The two active dams rated as “extreme” are located at BHP’s Olympic Dam and Mt Whaleback mines, due to the potential impact on nearby employees, it said.

Anglo American said on Friday it had published online details of its tailings storage facilities as requested by the Church of England.



Via Financial Times

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