Vale confirms talks with BHP over Samarco exit
Vale (NYSE:VALE), the world’s largest iron ore producer, confirmed Wednesday it is in talks with BHP Billiton over the future of their Samarco joint venture, including the possibility of the Brazilian miner taking full ownership.
During a meeting with investors and analysts in Sao Paulo, Vale’s investor relations director, André Figueiredo, said it seemed “natural” for the company to become the sole owner of the project.
One of the options on the table could see Vale grabbing BHP’s half-stake the in operation, but a price for it has not been set yet.
"Maybe Vale would be a natural owner of Samarco, maybe it could make Samarco operate again," Figueiredo said according to Reuters.
Since late December, several news outlets have reported the two firms were in advanced negotiations over Samarco’s future.
One of the options said to be on the table could see Vale grabbing BHP’s half-stake the in operation, but according to Brazil’s Veja (in Portuguese), the parties have not agreed on a price just yet.
Samarco, which was once the world’s second-largest iron-ore pellet operation, has been shuttered since the 2015 dam spill that that killed 19 people and caused sludge to wash downstream into neighbouring state Espírito Santo until it reached the Atlantic ocean, 600 kilometres away.
Last month, Samarco was granted a preliminary permit to begin work towards preparing an eventual restart, which is likely to happen — though at a reduced rate first — in the second half of the year.
Further licences to fully resume production could take a lot longer, regulators have said.