Facing lawsuits, Brazil mining company Vale to retire dams

Jan. 30 (UPI) -- Brazilian mining company Vale, the supplier involved in a deadly dam collapse last week, is cutting output and retiring dams as it faces lawsuits in Brazil and the United States.

Rescue efforts were expected to pick up Wednesday after the mud mixed with mineral waste became a bit thicker, allowing use of heavy equipment to dig for some of the 276 missing persons, G1 reported. They include 106 Vale workers; the rest are local residents and contractors.

Hundreds of military and firefighters are participating in the rescue. Pedro Aihara, a firefighters spokesperson, said rescue conditions for the past six days have been extremely difficult because liquefied mud is filling spaces and complicating the search, Folha de Sao Paulo reported Wednesday.

Rescuers have, in many cases, waded into neck-high mud searching for victims. Also, because the density of water is higher, the impact is harder and in many cases only body parts are being found.

Authorities have already said many of the missing would never be located.

Vale said Brazil's labor ministry has filed a lawsuit and requested the freezing of $215 million to secure compensation for relatives of lost Vale workers, the company said.

A class action lawsuit has been filed in United States District Court on behalf of purchasers of Vale securities, which plunged after the accident, on grounds the company didn't disclose risks posed by its dam.

Vale also said it presented to Brazilian authorities on Tuesday a plan to decommission all 10 of its dams built by the upstream method -- similar to the one that caused the collapse -- within three years. The plan involves halting production, which would impact about 40 million tons of iron ore per year.

The company is also making a $27,000 donation to victims' relatives, independent of compensation to be paid.

Shares of Vale gained about 8 percent on the Brazilian stock exchange by Wednesday and was the most traded stock of the day. Shares plunged more than 20 percent on Monday. They are still about 15 percent lower, compared with their level last week before the accident.

Market participants appeared Wednesday to receive well the decision to close dams and take actions to remedy the damage, Valor Economico reported.