Failure of Samarco Tailings Storage Facility: A Critical Analysis

This report discusses the failure of Samarco Tailings Storage Facility in 2015 and analyzes it from a strategic asset management perspective. It provides a detailed plan for strategic asset management of a tailings storage facility for mining organizations.

Running Head: Report
Executive summary
The report discussed the various contributory aspects for the failure of a major asset and how
the asset lifecycle needs to be designed and monitored to reduce the chances of such incidents
taking place in future by analysing the case of the Samarco Tailings Storage Facility (TSF)
failure of 2015. The critical analysis of this case is conducted from the strategic asset
management perspective. A report structure is followed for presenting the information
beginning with the introduction of the topic, an outline of the case of Samarco TSF failure,
the explanation and justification of the research methodology followed for presenting the
report, critical analysis of the Samarco TSF failure of 2015 and the strategic asset
management plan. The asset management plan helps in bringing about transparency in the
decision-making process related to the assets and maximizes the performance resulting in
optimisation in resource allocation and consumption. The report presents a detailed plan for
strategic asset management of a tailings storage facility for the mining organisations. This
plan is prepared in the wake of the Samarco TSF failure of 2015 that resulted in 19 fatalities
and submerged the entire village of Bento Rodrigues.
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Contents
Executive summary....................................................................................................................1
Introduction................................................................................................................................3
Case outline................................................................................................................................4
Research methodology...............................................................................................................6
Critical analysis..........................................................................................................................7
Strategic asset management plan in an engineering context......................................................8
Levels of service.....................................................................................................................9
Future demand........................................................................................................................9
Risk management.................................................................................................................10
Life cycle management plan.................................................................................................10
Financial projections............................................................................................................11
Asset management practices and improvements..................................................................12
Conclusion................................................................................................................................13
References................................................................................................................................14
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Introduction
This report presents the case analysis of the Samarco Tailings Storage Facility (TSF) failure
of 2015 by conducting a critical analysis from the strategic asset management perspective.
The failure in any tailings storage facility can have disastrous consequences not just for the
mining organisation but also on the environment and the nearby communities. Disasters are
associated with very high financial and reputational costs for the companies. Tailings are the
waste accumulated as a result of mining operations which is stored in the form of a salary
with the help of masonry dams. These dams are also known as a tailing storage facility (TSF).
In the year 2015, the failure of the TSF at Samarco mine in Minas Gerais is considered to be
one of the worst disasters in the history of Brazil. There were 19 fatalities reported because of
the incident and owners BHP Billiton Brasil and Vale S.A. recognized their mistakes and
agreed for a US$ 2.4 billion provision for fulfilling all their potential obligations according to
the agreement. The owners also faced various legal and financial repercussions (Anthony &
Hastings, 2018). This report carried out a critical analysis of the case of the failure of
Samarco TSF that took place in the year 2015 by focusing on the strategic asset management
from the engineering context. This is followed by presenting an appropriate plan for strategic
asset management of a TSF by covering the entire asset lifecycle of this facility. A report
structure is followed for presenting the information beginning with the introduction of the
topic, an outline of the case of Samarco TSF failure, the explanation and justification of the
research methodology followed for presenting the report, critical analysis of the Samarco
TSF failure of 2015 and the strategic asset management plan (Wei, Yin, Wang, & Wan,
2013).
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Case outline
It is important for the mining organisations to carry out proper storage and management of
tailings. The inability to do this can have global environmental and societal consequences.
Every TSF is designed in order to meet the applicable legal and environmental regulations to
ensure that is fit for its intended use and purpose. However, the policy Framework design for
this comprises of limited scrutiny of the regulations and broad standards that do not cover the
intricacies of the TSF designing and maintenance. The TSF failure of Fundao in Brazil
occurred on 5th November 2015. The catastrophic failure of the iron ore tailings dam resulted
in flooding and completely destroyed the village of Bento Rodrigues in Brazil. 19 people lost
their lives in this disaster and it is described to be the worst environmental disaster in the
history of Brazil. The TSF failure took place as a result of some small earthquakes that
caused liquefaction of the already stressed tailings dam. The seismic shocks because of the
earthquake resulted in the collapse but there were also numerous failures in terms of design
and maintenance of the TSF found by the investigating report. The liquefaction of sand was
also attributed to various construction defects in the designing and construction of the TSF
that go back to the year 2009 (Roche, Thygesen, Bastos, Bernaudat, & Chambers, 2018).
After the completion of the starter dam in the year 2009, the Samarco TSF was found to be
stressed. This starter dam was later subsumed by a larger dam of greater capacity. However,
the starter dam had construction defects in the base drain and engineers could not implement
the original concept. This led to the designing of a revised and completely new drainage
blanket that was designed at a higher elevation. This fundamental change in the design
concept of the dam contributed to widespread saturation. The increase in saturation also
increased the potential for sand liquefaction. Along with this, it was also found that the TSF
was depositing slime in the intended areas and there were also numerous problems identified
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with the concrete conduit that required raising the dam over the slimes. Numerous parts of the
dam but already in a very district state and the small seismic shocks resulted in the failure of
the TSF (Peck, 2014).
Failure sequence of Samarco TSF
A special commission was created in November 2015 to carry out the investigation and
follow the case closely. This failure of the tailings storage facility had disastrous
consequences for the environment, the nearby community and for the organisations involved.
21 executives of the organisation were charged with qualified murder and the mine has not
reduced its operations. The environmental consequences of this failure but also immense and
it is stated that the impact is going to last for many years in that region. Samarco is still
working towards the recovery of 5,000 streams and the restoration of 16,000 hectares’ area
designated for permanent conservation on the Doce River basin. More than 1,200 hectares of
land across the river bank is currently being restored and remediated by practicing
reforestation and bioengineering. The TSF failure affected more than 1 million people by
impacting their residence, close environment and livelihood (Parsons & Moger, 2015).
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Research methodology
The research methodology followed for conducting the study makes use of a combination of
descriptive and exploratory research design. Descriptive research provides a description of a
situation by describing the characteristics and functions. This is a structured method that is
used for studying the Samarco TSF failure of 2015 and for carrying out a critical analysis of
the incident. The exploratory research design is adopted for problem formulation and for
carrying out clear investigation by discovering new ideas and thoughts. The development of
strategic asset management plan for a TSF is done by following this research design. The
exploratory study is carried out for exploring a subject or an incident and providing additional
insights by carrying out the comprehension of various factors associated with it. This research
design is chosen because of its focus on discovering new thoughts and ideas and to provide
the necessary flexibility to the report. The descriptive research design is a conclusive study
that provides a description of the characteristics along with describing the specific features
and functions of the issue being analyzed. For the given research, the study of the failure of
TSF is done by conducting a descriptive research and by obtaining complete and accurate
information about the disaster and its consequences (UNECE, 2014).
This is a desk research that is based on secondary data. The secondary information is
obtained from the various academic and non-academic sources of information including the
previously published researches, government reports, industry reports, journal articles,
studies and academic writings.
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Critical analysis
The Fundão dam disaster began at 3:30 pm on 5th November 2015. It started with a leak in
the dam and a team of employees was immediately sent to the location where they took
action for mitigating the risk from the leak. Around 4 o'clock there was a rupture in the dam
that resulted in the release of a huge volume of toxic sludge in the river valley of Santarém.
The village of Bento Rodrigues that was located 2.5 kilometres away from the TSF was
completely flooded from the mud and the toxic water coming from the facility. Some other
villages located across the Mariana region and the Gualaxo river valley was also affected
because of the disaster. There was no contingency plan designed for evaluating the people
from these areas. The Brazilian Armed Forces got into action and evacuated 600 people from
the nearby villages to Mariana and they provided assistance to various others. The disaster
killed 19 people and the entire fish population in that area. It is estimated that at least 11 tons
of fish were killed and buried in the slurry because of the mud flow (Peters, 2018).
It destroyed about 1500 hectares of the riparian forest in the area and also lead to the
contamination of Rio Doce. Tailings of the iron ore from the Samarco TSF reached Doce
River the same day and contaminated the 87,000 km sq of drainage area of the river. It is
estimated that it might take decades before the waste introduced in the rivers because of the
disaster dilutes and reaches the pre-disaster level. The toxic mud from the TSF also reached
and contaminated the Atlantic Ocean and its impact is noticed on the beaches of various cities
located across the Espírito Santo coast (Bielecki & Pliska, 2009).
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Strategic asset management plan in an engineering context
The process of asset management for the organisations is associated with the management of
the physical assets of the company throughout their life cycle. It is very important to develop
and implement a proper plan for asset Management if an organisation plans to bring about
efficiency in its operations and improve quality while reducing the cost. The asset
management plan also helps in bringing about transparency in the decision-making process
related to the assets and maximizes the performance resulting in optimisation in resource
allocation and consumption. This section of the report presents a detailed plan for strategic
asset management for a tailings storage facility for the mining organisations. This plan is
prepared in the wake of the Samarco TSF failure of 2015 that resulted in 19 fatalities and
submerged the entire village of Bento Rodrigues. The organisations throughout the world are
trying to bring down the cost of operations. Same holds true for the mining industry where
the companies are constantly struggling with the escalating costs and lowering prices of the
commodity. An asset management plan will enable the mining organisation to carefully
consider the entire life cycle of the tailing storage facility analysing the cost of ownership and
operations and optimising them to enable the survival of the company in the present market
conditions (Schoenberger, 2016). The organisations investing time and capital in developing
an asset management plan contribute towards optimising the performance of the assets and
ensure that the facilities are running on a reliable schedule that is constantly assessed and
improved as per the current economic conditions and external environment.
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Asset management planning process (Andrews & Moody, 2014)
Levels of service
The tailings in the Mining industry are defined as the fine-grained solid materials that remain
after the minerals and metals have been extracted from the ore. This solid silt-sized material
is stored in the tailings storage facility that is designed for ensuring a stable, economical, safe
and non-polluting storage that does not have any impact on public health and safety. This
asset management plan is designed by adopting a risk-based approach to tailings management
for the development of a TSF that has a very low environmental and social impact during the
operation of tailings storage and even after the closure of the mines (Jolicoeur & Barrett,
2005).
Future demand
There is a need to develop an improved and advanced TSF that is able to endure the extreme
climatic conditions, government rules and regulations, environmental constraints and also
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fulfil the socio-economic context of the operation of the mines. The tailings are transported to
the storage facility in the form of slurry and the storage facility can occupy up to half of the
total area of disturbance when carrying out mining operations. The tailings storage facility
can also be designed in the form of integrated waste landforms and pits. There is an
increasing need of coming up with a sustainable TSF so that the potentially catastrophic risks
associated with the transportation and storage process can be minimised. The mining
organisations have to comply with the guidelines issued by the industry and various national
and international organisations to ensure successful operation and closure of these facilities
(Bowker & Chambers, 2015).
Risk management
The TSF face significant risk in terms of the process of mining operations, planning and
designing of TSF, construction of the TSF, operation of the facility and the risks associated
with closure, rehabilitation and aftercare of the TSF. It is important that the planning and
designing of the TSF are done in line with the lifecycle management plan to find out effective
and acceptable solutions for the mitigation of these identified risks along with the risk public
health and safety resulting from the establishment of the TSF (Mahoney & Pandian, 2012).
Life cycle management plan
The lifecycle management plan for TSF comprises of the guidelines beginning from the
planning, designing, construction, operation, closure, rehabilitation and after closure of the
facility.
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Life cycle of a TSF
The life cycle of a TSF is represented in the image below. The planning and designing
process needs to be carried out by following the key principles to achieve and enduring value.
The storage planning, as well as the design aspects of the facility, need to be developed
according to the baseline conditions and for mitigation of the planning and design risks. The
construction aspect of the TSF is covered in the second stage of lifecycle management of the
facility. The operation, monitoring and modification of the TSF covers the process of
examining the risks, controls and reporting of the performance (Piesold, 2017). The
decommissioning, closure and rehabilitation tailing storage facility takes into consideration
the various risks associated with the closure, the objectives of the social activity and the
criteria that need to be fulfilled for completing this process. It is important to involve the
community and engage with them for maintaining the tailings water balance and also address
any maintenance requirements office storage facility post the closure. The last step of the
lifecycle management plan for the TSF presents the conclusion and future directions of the
facility.
Financial projections
It is important that the tailings storage facility is constructed in a cost-effective manner by
carrying out financial analysis and financial projections of the cost and effectiveness of the
various alternatives to choose from when planning and designing the strategy. The
organisation responsible for the construction process should carefully compare the cost of
talent management for the company in the short-term and weigh them against the cost of
environmental and social impact along with the risks after the closure. The financial
projections for a TSF should include the necessary steps analysed and address throughout the
lifecycle of the mine and the TSF for reducing any liabilities post the closure. The financial
projections should ensure that the cost of mitigation of the post-closure liabilities of the
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tailing storage facility should not exceed the profits that the organisation makes throughout
the operational life of the mine and the TSF along with the accrued benefits due to other
operations (Gruis & Nieboer, 2004).
The financial projections for the TSF should be done by accessing the net present cost of
construction of the storage facility and by carrying out the value assessment. For this, the
organisation needs to assess the costs that are associated with placing the equipment for
dewatering and storage of the tailings, the options for transportation and the price sensitivity
of the various other consumables required for the operation of the facility. On the basis of
this, the organisation can rank the options and select the optimal options for dewatering,
transportation, storage and closure of the facility (Williams & Fourie, 2016).
Asset management practices and improvements
By conducting a review of the asset management plan, the organisation can assess the entire
process of collecting information about the condition of the asset. Improvement in the asset
management practices for a TSF can be brought about by reporting on the enquiries and
requests and maintaining a database of the same for carrying out a detailed inspection (UMS
Group, 2019). It is also important for the organisation to carry out a regular assessment
ensuring the safety of the storage facility and the maintenance intervention levels are
maintained by the organisation. Regular inspection of storage facility should be carried out by
developing a detailed schedule and the Asset Management practices can be further improved
by keeping a record of any reported defects and immediately taking steps for mitigating the
risks associated with the detected defects (Roche, 2018). The organisations should also
implement a management system that keeps a record of the maintenance work carried out for
TSF and the detailed asset condition should be regularly examined and recorded for carrying
out any future maintenance programs.
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Conclusion
This report presents the case analysis of the Samarco Tailings Storage Facility (TSF) failure
of 2015 by conducting a critical analysis from the strategic asset management perspective.
The report includes critical analysis of the disaster due to the failure of the storage facility for
the mine tailings in Brazil by following a combination of descriptive and exploratory research
design. Explanation and justification of the research design are presented along with the
explanation of a strategic plan for asset management for managing a TSF. The TSF failure
took place as a result of some small earthquakes that caused liquefaction of the already
stressed tailings dam (Schneider, et al., 2006). The seismic shocks because of the earthquake
resulted in the collapse but there were also numerous failures in terms of design and
maintenance of the TSF found by the investigating report. The report discussed the various
contributory aspects for the failure of a major asset and how the asset lifecycle needs to be
designed and monitored to reduce the chances of such incidents taking place in future.
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References
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Parsons, D. & Moger, L. (2015) Tailings Storage Facility Life of Mine Feasibility Design,
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