BRAZIL´S ECONOMY Samarco’s sales revenue is equivalent to about 6.4% of the GNP of Espírito Santo and 1.6% of the GNP of Minas Gerais
% Equivalência Receita Samarco ao PIB MG
1,6%
% Equivalência Receita Samarco ao PIB ES
6,4%
The Company paid R$ 1.5 billion in taxes in 2014. This corresponds to almost 20% of what the federal governance expects to collect annually with the new CPMF tax.
Expected CPMF revenue over 4 years
32,000,000
Samarco's direct taxes 2014 (1 year)
1,500,000
% Equivalence Samarco taxes/CPMF
19%
Amounts in R$ thou
In many localities, the taxes generated directly by Samarco’s activities are vital to the municipalities.
Taxes Mariana/MG
20,552 (54% of revenue)
Taxes Ouro Preto/MG
19,335 (35% of revenue)
Taxes Anchieta/ES
29,437 (50% of revenue)
Amounts in R$ thou
May 5th, 2016
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BRAZIL´S ECONOMY The Company’s exports represented 1% of Brazil´s total exports in 2015. Without the Company’s exports, the deficit in the Brazilian trade balance would have tripled in 2015.
Brazilian exports in 2015
191,134,324
Samarco revenue in 2015
1,921,460
Samarco's export representation
1%
Samarco's equity in the trade balance
10%
Amounts in R$ thou
In the last 5 years (2011-2015), Samarco´s total investments in Brazil were of R$ 9.1 billion, more than what Brazil spent on the construction and renovation of all of the football stadiums for the World Cup of 2014 (R$ 8.1 billion) or on the Transposition Project of the São Francisco River (R$8.2 billion).
Sources: MDIC, IBGE (2013), SEFAZ-MG, SEFAZ-ES (IPVA+ICMS+ITCD), Agência Brasil and Samarco
May 5th, 2016
03
TO DO WHAT MUST BE DONE THIS IS OUR COMMITMENT.
Samarco is a Brazilian company, owned 50-50 by Vale S.A. and BHP Billiton Brasil Ltda., which has been producing iron ore pellets for almost 40 years. Its industrial facilities include three concentrators at the Germano unit in the municipalities of Ouro Preto and Mariana in Minas Gerais, and four pellet plants and a sea port in Ubu, Espírito Santo, on the coast. These two units are connected by two pipelines, of some 400 km each, which transport the iron ore slurry from Minas Gerais to Espírito Santo, crossing 25 municipalities. We deeply regret the Fundão Dam collapse in November 2015 and its impacts on the population, the communities and the environment. We understand that we are responsible for the huge task of trying to do what is right. To reiterate this commitment, in the beginning of March 2016 we signed an Agreement together with our shareholders, VALE and BHP Billiton, and the Federal Government as well as the State Governments of Minas Gerais and Espírito Santo. The result of this Agreement is the creation of a private Foundation which will be responsible for the implementation of about 40 programs focused on two main types of actions – socioeconomic and socioenvironmental. In addition to new proposed projects, the document encompasses all of the emergency actions which Samarco has already been carrying out since last November to provide relief for the affected people and to mitigate the environmental impacts.
May 5th, 2016
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TO DO WHAT MUST BE DONE THIS IS OUR COMMITMENT.
Overview All families who have lost their homes are already installed in temporary houses or temporary accommodation chosen by them. Possible locations for the reconstruction of the Bento Rodrigues and the Paracatu de Baixo communities are already being identified and will be chosen with community participation. All students from the affected communities in the Mariana and Barra Longa region have concluded the 2015 school year and are up to date with the 2016 school year. 786 hectares were revegetated along the Doce, Carmo and Gualaxo rivers. The measure protects the riverbank areas and prevents sediments from being deposited into the riverbeds. Water quality is being monitored at 113 different sites along the Doce River and in marine areas near the mouth - 29 sites at sea and another 84 along the Doce River. Seven damaged bridges were rebuilt within 90 days, that being one at every 15 days, and the access to the communities was fully reestablished. 6.028 emergency financial assistance cards have been distributed to affected individuals. Dams are stable, with real-time monitoring. *Data updated on May 5th, 2016
May 5th, 2016
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THE AGREEMENT Commitment and Transparency The Agreement was signed on March 2ND, 2016 between Samarco and its shareholders, Vale and BHP Billiton, the Federal government and the state governments of Minas Gerais and Espirito Santo. The document focuses on the socio-environmental and socio-economic compensation actions, maintaining what is being adopted by Samarco since November, besides establishing clear commitments, defining deadlines for the submission and execution of any new projects and also setting transparency and accountability rules. The affected populations will be able to monitor all projects, external audits will occur and an ombudsman service will be created to attend to the citizens’ demands. “We understand that we are responsible for the major task expressed in the agreement and we will make every effort to comply with our obligations. Samarco has a great commitment to the impacted people and environment and will give full support to the Foundation and to the implementation of the programs in all work fronts, as provided in the signed document.” Roberto Carvalho, Director-President-in-office. The Foundation The agreement provides for the creation of a Foundation that will be maintained by Samarco and that should be created within 120 days. Until it is in operation, the company will continue to perform all the social and environmental restoration actions in progress.
Investment
When
BRL4.4 billion
First three years
BRL240 million per year for compensatory actions
From 2016 to 2030
Between BRL800 million and BRL1.6 billion
Between 2019 and 2021
BRL500 million - basic sanitation fund for affected municipalities
By the end of 2018
Annual contributions will be defined according to the forecast of the annual progress.
Starting in 2022
May 5th, 2016
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THE AGREEMENT Socio-economic and socio-environmental highlights
SOCIO-ENVIRONMENTAL COMMITMENTS Availability of resources, as compensation of BRL500 million, for certain affected municipalities, to use in the preparation and execution of plans for sewage collection and treatment and landfills.
Compensatory recovery of 5 thousand springs to be defined by the Basin Committee of the Doce River.
Recovery of Permanent Protection Areas (PPAs) of the Doce River and tributaries through the compensatory reforestation of 10 thousand hectares and conduction of natural regeneration of 30,000 hectares in a period of ten years in the amount of BRL1.1 billion.
SOCIO-ECONOMIC COMMITMENTS Reconstruction of the affected locations, such as Bento Rodrigues, Paracatu de Baixo (Mariana) and Gesteira (Barra Longa), ensuring their participation in the dialogue process with the affected communities to define measures for the recovery or relocation.
Running a compensation program and compensations through coordinated negotiation, designed to repair and compensate the people affected, with optional adhesion.
Cultural material recovery and preservation of the cultural heritage affected.
Implementation of actions for the recovery of economic and productive activities affected, such as agriculture, fishing, services and commerce.
Implementation and maintenance of measures to support the indigenous people affected.
Creation of permanent channels of communication and dialogue with the community, as well as carrying out agendas to present the progress and results of the programs to be implemented.
The health, social protection and education programs for the restoration of affected public services and the follow up of individuals and families affected are foreseen.
May 5th, 2016
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SOCIO-ECONOMIC ACTIONS Family housing • All affected families are already installed in homes or other types of accommodation chosen by them, in Mariana and Barra Longa. • The transferring of the families to the new housing followed the prioritization criteria and methodology defined by the Commission of Representatives of the Affected Communities.
Steps for the delivery of houses to families
Occupation, Work and Income • On all work fronts, priority is given to hiring locals. • In March, 220 young people concluded training in construction and gastronomy technical courses. • In Mariana and Barra Longa, from the 312 people eligible for work, 225 were hired through Samarco’s “Occupation, Work and Income” Front.
May 5th, 2016
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SOCIO-ECONOMIC ACTIONS Reconstruction Amongst the major reconstruction actions is the setting, in the month of May, of the new district of Bento Rodrigues’ location. Residents will decide on the location of all common use equipment, such as squares and religious temples. Thenceforth, urbanization works will be initiated. Steps for reconstruction Definition. of the land Design, with the community, the new plant of each district. In this stage, the conceptual project, defining the localization of equipment, such as churches, schools, health centers, parks and soccer fields, will be elaborated. The criteria to define the size of the land and construction standards of the homes will also be decided – still without individual decisions. Individual dialogue with the families to decide details, such as location and structure of each residence and finishing standards. Once the individual agreements are closed, the reconstruction will start.
Moving and monitoring the families in new homes.
May 5th, 2016
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SOCIO-ECONOMIC ACTIONS Financial Support • 560 financial aid cards were delivered to families in the communities of Mariana, Barra Longa and Rio Doce (MG); • 5.468 financial aid cards were directed to fishermen and riverines along the Doce River in Minas Gerais and in Espirito Santo; • The aid includes the monthly payment of a minimum wage to each person in the household who has suffered income loss per work activity as a direct result of the dam burst, plus an additional 20% of the minimum wage for each dependent and a basic foods hamper.
Financial aid cards are given to communities and riverine population
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SOCIO-ECONOMIC ACTIONS Infrastructure • 100% of all access ways clear. • Seven damaged bridges were rebuilt within 90 days, that being one at every 15 days, and the access to the communities was fully reestablished. In Barra Longa • 61 houses have been renovates and another 27 are under the process. • 25 of all commercial establishments have been renovated and another 7 are under the process.
One of the renovated properties delivered in Barra Longa
Rural property • 170 rural properties were mapped and integrate the Agribusiness Reestablishment Plan, which aims at supporting producers so that each property affected by the accident is able to regain sustainability. • Teams consisted of zootechnicians, agronomists and farm technicians are performing soil analysis of the properties, as well as soil preparation and correction with the use of limestone and fertilizers, crop cultivation and weeding. • Approximately 134,000 meters of fencing has been accomplished on affected rural properties. May 5th, 2016
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SOCIO-ECONOMIC ACTIONS Animals • More than 6,900 animals have been attended to by Samarco. • They are currently under the company’s care. 1,178 of them are large animals. • Over 2,433 tons of inputs have been distributed to animals in Barra Longa, Pedras, Barretos, Paracatu de Baixo, Paracatu de Cima, Camargos, Ponte do Gama, Campinas, Mariana, Bento Rodrigues e Águas Claras.
Rescued and assisted animals
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SOCIO-ECONOMIC ACTIONS Health • Samarco has hired 27 qualified professionals – doctors, psychologists ans other – to assist the people impacted.
Health professionals were hired in Mariana and Barra Longa
May 5th, 2016
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SOCIO-ECONOMIC ACTIONS Education • All students from the affected schools, in Barra Longa and in the Mariana districts, have completed the 2015 school year and have started 2016 up to date, as planned. • The company carried out a number of renovations in order to receive students and also offered school transportation. • The students received kits comprising of backpack, pencils, crayons, pens, paint, play dough, and other school supplies. • Teachers and students received psychological support.
Patrimony • Approximately 400 sacred art pieces rescued from the Chapels of São Bento and Nossa Senhora das Mercês (Bento Rodrigues), Santo Antônio (Paracatu) and Nossa Senhora da Conceição (Gesteira). • 282 training sessions were given to people involved in the rehabilitation activities, including members of the community, in order for them to be able to handle any findings.
All students from the impacted schools have started the 2016 school year
May 5th, 2016
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ENVIRONMENTAL ACTIONS Revegetation • To date, 786 hectares over the rivers Doce, Carmo and Gualaxo in Minas Gerais were revegetated. • This stage of the work promotes the improvement of soil conditions and allows future recovery actions, the minimization of dust dispersion and assists in the containment of sediments reaching the watercourses.
NOVEMBER 2015
MARCH 2016
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ENVIRONMENTAL ACTIONS Water • Water supply reestablishment in all cities affected by the passing of the turbidity plume. • Coagulant usage in water treatment plants.
The Doce River’s color and turbidity level recovery • Daily monitoring of the river’s - 22 points set by IBAMA. • More than 500,000 analyzes performed, generating 25,000 reports. • Current results indicate that the river’s water quality is similar to the patterns observed in 2010, as indicated in the December report by the Brazilian Geological Service (CPRM) and the National Water Agency (ANA).
Water Monitoring • Water quality monitoring at 113 points along the Doce River and in the marine areas near the river mouth - 29 points at sea and 84 points on the Doce River. • Turbidity plume monitoring by means of overflights (3 times per week).
113 monitoring sites along the Doce River and in the ocean
May 5th, 2016
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ENVIRONMENTAL ACTIONS Sonar • In March, the second phase of the presence of fish in the Doce River region monitoring took place. • The aim was to continue observing and mapping the presence of marine fauna in the water course, as carried out in the first expedition held in December 2015. • The existence of shoals was reconfirmed.
Second sonar expedition held in March
May 5th, 2016
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DAMS Monitoring • Real-time radar, laser scanning, camera, water level meter (piezometer) and accelerometer monitoring, among others. • New Mining Dam Emergency Action Plan completed, including the installation of sirens along the Mariana and Barra Longa communities. • Drills – execution of assisted emergency drills, in March, 2016, with participation of 1,327 residents of the Mariana and Barra Longa communities. Conducted by the state and municipal Civil Defenses.
Monitoring room at the Germano Unit
May 5th, 2016
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DAMS • The Germano and Santarém dam structures are stable. • Structural reinforcement works completed - Selinha dyke and Santarém dam. • Three containment dykes built to prevent tailings from reaching rivers Carmo, Gualaxo and Doce. • Permanent contention is being built in this drought period.
BEFORE
AFTER
May 5th, 2016
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