Anglo American hit by Brazilian fine for pipeline leak

Anglo American has been fined a $38m over pollution caused by the first of two leaks from an iron ore pipeline at its Minas Rio mine in Brazil last month, with another fine likely over a second leak.

The FTSE 100 company has since closed the pipeline for inspection, saying the second leak was "minor" and of non-hazardous iron ore slurry. The second leak was stopped within eight minutes and caused no disruption to local water supply, but occurred not far from the first leak, which was midway through the month.

Semad, the regional environmental regulator, said that the leak “caused pollution and environmental degradation that resulted in damage to water resources and may have caused harm to public health and the wellbeing of the population”. It indicated that it would also fine Anglo over the second leak.

Analysts at Goldman Sachs said at the time the pipeline was shut for inspection: "Even if there is a stoppage of a month, we calculate that it would lead to an EBITDA loss of circa US$20m."