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Business Life Cycle

The integrated and systemic planning of the stages in the mine life cycle favors process optimization and risk management, as well as being essential for the success of mining activities and for mine closure to be carried out properly.

Stages in the mine life cycle:

Closing actions for a mining venture should consider the multiple legal, environmental and social attributes relevant to the process, as well as economic issues.

Mine Closure:
Definitive cessation of mining operations. Process that covers the entire mine life cycle, from the phase of economic feasibility studies to the closure of mining activity, including decommissioning, rehabilitation and future use of the impacted area.

Our Management

At deployment and during the initial phase of an operational unit, the closure plan approach is prognostic and conceptual. As the operation proceeds and the closing horizon is defined, studies and projects evolve to reach the detailed stages.

For the success of these projects, Vale establishes an integrated planning with a multidisciplinary team. Thus, it is possible to promote the reintegration of the mined territories to the physical, biotic and socioeconomic means, enhancing the concatenation of closing actions between the different phases of a mining enterprise and contributing to the value chain.

In summary, our objectives for mine closure are:

Establish appropriate methodologies for the reparation and mitigation of impacts caused to all environmental fronts (air, water, soil, biota) and local communities
Identify scenarios for future use, compatible with the environmental and socioeconomic vocations of the affected areas, aiming to minimize negative interference and enhance positive ones.

Decommissioning:
It is the phase of the structure's life cycle that begins with the confirmation that it is no longer needed in the operational context of the project and, therefore, may undergo works aimed at its closure.

Governance

The mine closure theme occupies a special position in Vale's business strategy.

Vale's Environmental Management Executive Department is responsible for regulating the mine closure theme and acts as a second line of defense in risk management. It provides information to close operations in accordance with best practices and legal requirements. For the Ferrous area, the Closed Mines Department works on the stabilization and de-characterization of existing geotechnical structures, ensuring continuous monitoring. Its priority is also to act in mine closures and the future use with concepts of shared value with society.

Provisions for Asset Decommissioning and Mine Closure

We prepare and review, on an annual basis, cost estimates for the decommissioning of our assets (pits, piles, dams, industrial facilities etc.), which follows the ARO methodology - Asset Retirement Obligation , with disclosure in the accounting reports, which meets the requirements set by the International Accounting Standard. (IAS) 37 and the SEC - Securities and Exchange Commission, and is a part of the flows defined by the company to comply with the Sarbanes-Oxley Act.

For Vale, the Mine Closure and its respective provision are the most important planning tools, given its permeability in practically all processes associated with mining projects (research, implementation, operation and decommissioning), and not just closure of the activities. These are dynamic processes in terms of content and degree of detail and should therefore be periodically updated to adapt to any changes in the socio-environmental and cultural characteristics of your area of influence.

Vale monitors all mine closure and progressive rehabilitation actions at its units, managing the correct allocation of the resource. For 2020, Vale is planning to disburse R $ 1,25 billion for the decommissioning of assets and for the preparation of mine closure.

Partnerships

Vale participates in the ICMM (International Council on Mining and Metals) Mine Closure discussion group, which is attended by 23 companies in the sector
Sponsored the publication of the IBRAM (Brazilian Mining Institute) Mine Closure Planning Guide

Policies and Procedures

PGS-002828 - Mine Closure Guide:

Establishes guidelines for all Vale mining operating units to address decommissioning of assets and mine closure in their planning, in the form of a specific Mine Closure Plan (PFM). This plan must consider actions necessary for the progressive decommissioning of each asset, as well as for enterprise closure itself, at the end of its operating life.

PTP-000873 - Asset decommissioning provision:

Establishes guidelines and criteria for managing the decommissioning provision of Vale assets. All long-term tangible assets, associated with Vale Group’s mining ventures in implementation, in operation, halted and shutdown, have the due provision recorded.

Risks

ICMM (International Council on Mining and Metals) proposes the implementation of an approach for mining companies to control financial risks at the mine closure stage so that environmental liabilities are eliminated and a positive environmental and social legacy can be left for society after the closure of mining activities.

Perspectives

The mine closure area has the following pillars:

Plan

Establish and unify key processes

Innovate

New subject for company and relatively unprecedented for the domestic market

Acculturate

“Culture eats strategy for breakfast” - Peter Drucker

Shared Value

Business Value + Social Value

Business Case

Since 2014, Vale has been progressively closing its structures. Several of them have already been decommissioned, such as the Claras Mine.

"Águas Claras" Mine Recovery

The extraction of iron ore at the Águas Claras Mine, located in the municipality of Nova Lima, State of Minas Gerais, took place between 1973 and 2002. The mine belonged to Minerações Brasileiras Reunidas (MBR), acquired by Vale in 2006.

Currently, the unit is used as the administrative area of the Company in Minas Gerais and houses about 2,000 employees. The mine is in the process of closing and several activities have been performed, including:

Erosion Containment
Installation of rainwater drainage equipments
Vegetation coverage with native species
De-characterization of assets

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