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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:
Integrated and systemic planning, associated with the stages of composition of the mine life cycle, including the closure of the mine, is essential to the sustainability of the territories in which they occur. How closing actions can be used, how they must be anticipated as socio-economic to minimize local and regional economic impacts. 

In order to guarantee the success of these actions, Vale defines integrated planning through a multidisciplinary team. Thus, it is possible to promote the reintegration of the mined territories to physical, biotic and socioeconomic environments, contributing to the sustainable development of these locations. 

To guide its strategy and actions, a company with the Mine Closure Guide and other internal guidelines. The company also participates in the discussion group for Closing the Mine of the International Council for Mining and Metals (ICMM - International Council for Mining and Metals), which is attended by 23 companies in the sector. 

Vale monitors all mine closure actions and progressive rehabilitation of its units, through the correct management of resource allocation. In 2019, a company disbursed approximately R$ 150 million in activities of definitive and progressive closure. 

During 2019, there were no updates to the Mine Closure Plans. The plans are in line with the good practices adopted by ICMM and national legislation. For 2020, R$ 234 million is planned or disbursed for the decommissioning of geotechnical, civil and industrial structures and in preparation for the closure of the mine, without considering as activities to de-characterize high open dams.

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:

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

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:

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