Brazil’s Vale says may expand Carajas Serra Sul mine, doubling output

S11D, also known as Serra Sul, will add 90m tonnes of annual capacity to Vale’s output by 2020, or about 20% of its expected output for that year. (Image: José Rodrigo Zermiani | Agência Vale.)

Brazilian miner Vale SA said on Tuesday it is considering doubling the output of its Carajas Serra Sul iron ore mine in the northern part of the country after 2020, saying the move would allow it to cut the use of tailings dams.

One such dam, used to store the muddy, toxic mining debris, collapsed in late February, killing more than 230 people.

Vale expects to produce 75 million tonnes this year from the S11D operation in Carajas Serra Sul, its biggest mining project ever, with output seen increasing to 90 million in 2020, the company said in a presentation for investors.

In a forecast labeled “Beyond 2020,” Vale outlined a possible expansion in Carajas Serra Sul to 150 million tonnes or production.

The move to boost capacity at Carajas would also boost the company’s flexibility in providing “premium products” to the market, the company said in slides to be presented by recently named Chief Executive Officer Eduardo Bartolomeo at a conference.

Reiterating comments made during its quarterly earnings presentation last week, Vale also said it is reviewing its portfolio of assets, considering their risk and return.

The company said that among its challenges is to have a lean portfolio, while optimizing growth and risk factors.

(By Luciano Costa, Carolina Mandl and Christian Plumb; Editing by Jeffrey Benkoe)