News: BHP Brazil's Samarco expects to reach 60% of output capacity by year-end

Brazilian miner Samarco expects to reach 60% of its output capacity by the end of 2024, bringing forward a previous timeline, as it continues to resume activities after halting operations due to a deadly 2015 tailings dam collapse.

The company said it had brought forward the timeline because it managed to start operations at a new pelletizing plant ahead of schedule. It had previously expected to achieve the target in 2025.

WHY IT'S IMPORTANT Samarco is a joint venture between mining giants Vale VALE3.SA and BHP (BHP) , as well as a major player in the global iron ore pellet market.

By bringing the production target forward, it will be able to start 2025 with the capacity to make some 15 million metric tons of pellets per year.

MORE CONTEXT The company, whose production currently sits at around 30% of total capacity, has been gradually resuming activities since late 2020 after the collapse of a tailings dam at one of its mines in November 2015 led it to halt operations for five years.

The disaster in Mariana, in the state of Minas Gerais, killed 19 people and polluted a river.

Samarco, which is opening its second pelletizing at the Ubu complex in Espirito Santo state on Friday, targets reaching 100% of its capacity by 2028.

KEY QUOTES Samarco CFO Gustavo Selayzim told Reuters the expansion plans could make the firm the second-largest pellet exporter in the global seaborne market, which is led by Vale. Samarco currently ranks "third or fourth," Selayzim said.

"We are managing to get it up and running between six and three months ahead of the initial forecast, eliminating an execution risk," he said about opening the pelletizing plant ahead of the initial March 2025 target.