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Casualties rise after dam burst at Vale-BHP mine in Brazil

Reuters with CNBC
Dam burst at Vale-BHP mine devastates Brazilian town

A burst dam at an iron ore mine owned by Vale and BHP Billiton left at least two people dead, more than 30 injured and dozens missing overnight, a spokesman for firefighters in the city of Mariana said on Friday.

The dam had been holding back waste water at the Germano mine operated by the firms' Samarco joint venture, and the disaster unleashed a mudslide that destroyed hundreds of homes in a nearby village on Thursday.

The incident has halted operations at the mine, which produces about 30,000 tons of pellets per year.

Samarco said in a statement it had not yet determined why the dam burst or the extent of the disaster at the mine, which is near Mariana in Minas Gerais, south eastern Brazil.

People gather at the Arena Mariana, in Mariana, after a dam broke in the locality of Bento Rodrigues.
Douglas Magno/AFP/Getty Images

Civil defense authorities in Mariana said they were evacuating about 600 people to higher ground from the village of Bento Rodrigues, where television footage showed dozens of homes destroyed by the mudslide. A car rested on top of a wall where the roof of a building had been ripped off.

They said the flood had also reached another village further down the hill, called Paracatú de Baixo, and that inhabitants there were being evacuated.

The dam was holding tailings, a mining waste product of metal filings, water and occasionally chemicals. It was located near the Gualaxo do Norte river, adding to fears of potential water contamination.

Miners are struggling amid a collapse in prices of iron ore and other commodities due to concerns about demand from China, the world's top consumer of industrial raw materials.

Samarco produces about 30 million tonnes per year of iron ore, just under 10 percent of Brazil's output. Iron ore is transported down a slurry pipe from Germano to Espirito Santo, where it is turned into pellets.

Vale has directed media questions to Samarco.