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Water Level Alert At Second Vale Tailings Dam Downgraded
Feb 06, 2019

Dam VI had been inspected shortly afterthe breach of Dam I last Friday that resulted in casualties and damage to plant facilities, the loading terminal, maintenance workshops and administrative buildings at the mine, located in Brumadinho in Brazil’s southeastern state of Minas Gerais. 
The structure of Dam VI, which contains 843,800 cubic meters of tailings, was verified to be within safety parameters, “even after the impact of the tailings,” the miner said on Sunday.

But on Sunday, however, a siren warning was activated in the region of the Córrego do Feijão mine after an increase of the water levels was detected by the tools that monitor Dam VI.

“The company is draining Dam VI with the use of pumps, to reduce the amount of water in the reservoir and the water levels already receded to safe levels, reducing the critical alert level from 2 to 1,” Vale said.

The Córrego de Feijão mine forms part of the Paraopebas complex in Vale’s Southern System. The mine produced 8.5 million tonnes of iron ore in 2018, out of a total output of 27.3 million tonnes from Paraopebas.

The complex’s other mines and processing plants were not affected by the breach of Dam I, the miner said.

Vale said the movement of the tailings from Dam I was limited because they were relatively dry, since the dam was inactive and was not receiving further tailings since 2015. But it cautioned that the tailings “are still not stable, and there may be more intense movements depending on the weather conditions, especially rainfall over the affected region.”

Market participants expect seaborne iron ore prices to rise amid the disruption to supply.

The February 62% Fe iron ore futures contract on the Singapore Exchange had been traded at an average price of $78.50 per tonne cfr China by 1.51pm Singapore time on Monday January 28, compared with an average price of $74.40 per tonne cfr last Friday. 

The SGX’s February 65% Fe iron ore futures contract had traded at an average price of $93.60 per tonne cfr by the same time on Monday, compared with an average price of $89.03 per tonne.

Fastmarkets’ MB 65% Fe Iron Ore Index was at $89.10 per tonne cfr China last Friday, down $0.10 per tonne from a day earlier.

The MB 62% Fe Iron Ore Index stood at $74.69 per tonne cfr China last Friday, down $0.02 per tonne for the day.