On January 25, 2019, a tailings dam in Brumadinho, Brazil, owned by mega-miner Vale SA collapsed, releasing 12 million cubic meters of mine waste. This tsunami of mud swept everything away for miles downstream. The death toll is over 100 people so far, with hundreds more missing.

Videos showing the dam bursting and the wall of waste engulfing everything before it are truly horrifying. The before and after images show the extent of the catastrophe, but only hint at the human cost.

As bad as this is, what makes it much more than a disaster for the company and the local people is that something similar happened in 2015. Whole towns were swept away, and 19 people were killed. That mine was a joint venture between Vale and BHP. They were sued, of course, and the regulators pounced as well.

This is what makes it so striking that a second and a much worse catastrophe like this could happen—to the same mine operator in the same region of Brazil.

Vale had years to learn from the previous disaster and make sure it didn’t happen again—so what went wrong?

What happened to the government inspectors tasked with the same mission?

Well, it now seems to be developing into a tale of greed and corruption. Reports are out that Vale knew that some sensors on the dam that just burst weren’t working, and management pressured inspectors to certify it anyway.

This sad debacle is just getting going. Vale probably just killed 10 to 15 times more people than last time, making this disaster an order of magnitude worse. If they knew they had problems with this specific dam, the lawsuits and ensuing compensation and regulatory response could bankrupt even a company this big. If I were a short seller, I’d be looking real hard at Vale now.

As a person who has stood on and just below such dams many times, I take the apparent negligence and corruption here very seriously. As a human being who feels for the victims, I’m outraged. Those responsible within the company, its contractors, and the government who failed the people of Brumadinho so utterly should be held accountable. If crimes were committed, the fullest price should be paid.

The mining industry itself should get fully behind demands for justice Vale’s victims.

If it doesn’t, it will empower the anti-mining activists of the world to paint the entire industry as a bunch of Hollywood movie villains. Vale is well on its way to being branded as a company willing to let people die in pursuit of profit. But this is not just a problem for Vale or Brazil. Remember the Mount Polley tailings dam collapse of 2014? There were no fatalities, but the environmental damage to a beautiful region of Canada made headlines around the world. There have been a half-dozen such failures in recent memory—and if you count miners trapped underground and other mine disasters, it would be easy portray the entire industry as callously unconcerned for human life.

This would compound the tragedy, because it’s not true.

Modern mining by public companies is overall a strong net positive for all stakeholders. I know this, because I’ve seen it myself. I’ve been to many mines where the companies go to very great lengths to ensure the safety and wellbeing of their own people and the surrounding communities. I’ve seen places where such mines had huge and positive impacts on the lives of all groups concerned. The benefits for some of the poorest people on earth are enormous.

And life as we know it today would simply not be possible without mining.

No mining = Stone-Age living—after wiping out 90+% of human population.

It’s as simple as that.

But most people haven’t seen what I’ve seen. They have no idea how vital mining is to their everyday lives. If the anti-mining crowd can portray not just Vale, but the entire mining industry as callous and corrupt, people will believe them. Shareholders will suffer as a consequence in the shorter term, but it will make life more difficult for everyone on our planet in the longer term.

That’s why I think it’s essential for the mining industry to be proactive about this. They should go beyond backing the demand for justice in Brazil. Companies with tailings dams should revisit assumptions, make sure inspections are fully adequate, and be very public about it.

The mining industry should do everything it can to reassure the public that it takes their safety and its own responsibilities seriously. Yes, this will cost money—but failing to do so will cost much, much more.

That’s my take,

Thursday, February 7, 1:52pm, EST, 2019