Court Stops Vale’s US$4.1B Railway: Daily

By Mary Carroll, Contributing Reporter

RIO DE JANEIRO, BRAZIL – A logistics project worth US$4.1 billion has been stopped in its tracks, as the world’s largest iron ore producer, Vale, was forced to suspend work on the extension of the Carajás Railroad (EFC) after being subpoenaed by the 8th Federal Circuit Court of Maranhão.

The environmental licensing process of the project which had been granted to the company was also suspended.

The court of Maranhão made the decision because of the civil action filed by the Human Rights Society of Maranhão, the Indigenous Missionary Council and the Maranhão Center for Black Culture, against Vale and IBAMA.

Vale are set to appeal the decision and claim that they have complied with all legal requirements. The development of the railway is crucial for Vale if iron ore production is to increase as planned by the mining company.

The extension would increase transport capacity of the EFC from 130 tonnes per year to 150 tonnes a year initially, and in the future would eventually reach 230 metric tons.

Vale had the sixty kilometer railroad approved by IBAMA and work had already begun when the order came from the court to suspend work on the project.

Carajás is only part of a project called CLN 150 Mtpa, which will also increase the capacity at the port Sistema Norte and will include the construction of the fourth pier of the marine terminal at Ponta da Madeira. A reported US$2.8 billion in total has already been invested in the project.

Regarding the details of the Carajás Railroad, the Federal Court of Maranhão said in a statement “Vale should disclose these studies and reports in language that is understandable to all communities impacted by the project.”

According to the court, the plaintiffs seek to prevent the completion of the railway in areas where it has not occurred, in order to prevent “serious damage to specially protected areas and the traditional way of life of indigenous Awa Guajá (municipalities Zé Doca and São João do Caru)”, and the Quilombo people as the railroad would pass through many of their communities.

Read more (in Portuguese).

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