Environmental threat in Brazil
It is a first step for Vale concerning its new iron ore project, after the Brazilian company has obtained a preliminary environmental license. Indeed, according to a press release of Vale on 27th June, the license had been put out by the IBAMA (Instituto Brasileiro do Meio Ambiente e dos Recursos Naturais Renováveis).
Vale is now waiting for an installation license, which will allow the start of construction work, and an operational license, which will allow the production to commence. In any case, it represents good prospects for the future of the company, whereas increasing environmental and fiscal obstacles are making new mining projects more difficult. Moreover, market analysts have considered this announcement positive for the company´s shares.
It concerns the iron ore project Carajás S11D, which is the largest project in Vale´s history. Located in the state of Pará in the Amazon rainforest, the mine should produce annually around 90 million tons of raw materials. Heavy investments are planed such as US $ 8 billion for the development of mine and processing plant and US $11 billion for logistics infrastructure (the Carajás railroad and the Ponta de Madeira maritime terminal).
NGOs are worried about social and environmental impacts of this project. Located in a conservation area (the Carajás National Forest), they denounce the potential damages which will occur in the forest. Moreover, the Carajás railroad will affect 16 communities, who are living along the future railway. According to Amazon Watch, other expected impacts are: “Air and water pollution, running over of wild animals, disruption of rivers due to new roads, etc.” In 2012 Vale was awarded with the “Public Eye Award ” for its social and environmental misdeeds by a group of NGOs.
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