MP Pension places Vale in quarantine after Brazilian dam disaster

Danish pension fund MP Pension has placed the Brazilian mining giant Vale in quarantine following the dam burst in Brumadinho last week, which killed over 80 people and left hundreds more missing, presumed dead.

This means that the fund is not allowed to invest further in Vale, owner of the burst dam, before a series of issues have been investigated and solved.

At the moment, MP Pension has DKK 49m (€6.5m) invested in Vale.

“We have had Vale under observation for a long time, primarily due to the company’s problematic mining in Mozambique. And now this disaster happened on top of that,” MP Pension CIO Anders Schelde said in a statement.

Vale was also the owner of the dam which burst in Mariana, Brazil, in 2015 – a disaster which killed 19 and left 250,000 without clean water. At the moment, there are fears around whether a third Vale dam collapsing, MP Pension said.

“We will now investigate the ins and outs of this incident. We are already in a critical dialogue with the company regarding the Mosambique activities and now we have to expand on it,” Schelde said.

According to Reuters, Vale chief executive Fabio Schvartsman vowed to take up to 10 percent of Vale’s output offline to decommission 10 dams similar to the one that burst, in order to preemt tough questions about its safety record.

The Council on Ethics of the Swedish AP funds yesterday announced a loss of confidence in the miner and is looking to advise the funds to pull away from its investment of billions of SEK.

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