LONDON (Reuters) - A global inquiry into how mining companies store billions of tonnes of waste in huge dams, launched after a collapse in Brazil killed hundreds, shows about a tenth of the structures have had stability issues, investors said on Thursday.
The research was led by the Church of England (CoE) and fund managers after the collapse of a Vale VALE3.SA dam in January unleashed an avalanche of mining waste on the Brazilian town of Brumadinho, killing an estimated 300 people.
A waste, or tailings dam, is the most common waste disposal method for mining companies, whether they’re extracting iron ore, gold or copper. They are among the largest man-made structures on earth, with some towering dozens of meters high and stretching for several kilometers.
The major investors, who manage assets worth a combined $13.5 trillion across a range of industries, wrote to mining companies in April asking for information about tailings dams to be disclosed about every mine they control.
They warned they might have to divest their shares unless they had clear information on potential risks.
Of 726 companies contacted, 43% responded. All the major listed miners, including Vale, were among those who replied, according to the investors, jointly led by the CoE Pensions Board and the Swedish AP Funds Council of Ethics.
Initial analysis of company disclosures found tailings dams across the globe hold more than 44 billion square meters of waste.
The disclosures so far showed 166 out of 1,635 of tailings dams have had stability issues in their history, although it was unclear how severe those issues had been and the miners said the problems had been addressed, the investors said.
The investors and senior mining executives are meeting in London on Thursday to review progress on improving dam safety.
They aim to complete an independent global database by the first anniversary of the Brazilian dam disaster on Jan. 25.
John Howchin, secretary general of the Council on Ethics of the Swedish National Pension Funds and Co-Lead of the Mining & Tailings Safety Initiative, said the investors would redouble efforts to secure the missing disclosures.
“There is simply no excuse to not disclose on a material risk, that as owners of these companies, we need to urgently understand. It is clear that investors’ patience with non-disclosing companies will not remain for much longer,” he said
There are no established global mining industry standards defining what a tailings dam is, how to build one and how to care for it after it is decommissioned.
The International Council on Mining and Metals (ICMM), an industry trade group, said in March it was working on new tailings dam standards with the U.N. Environment Programme (UNEP) and ethical investors.
Reporting by Barbara Lewis; Additional reporting by Ernest Scheyder; Editing by Pravin Char
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