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INTERNATIONAL FIRMS Q&A


The promise of a resource-rich region


Clovis Torres, general counsel of Vale, the world’s second largest mining company, discusses the challenges and complexities of developing projects in Latin America.


From your perspective as in-house counsel, what issues come up often in cross-border production and trade? In terms of commercial rules, from a global perspective, we usually have to deal with antitrust measures as we have to comply with the rules of the ju- risdictions of our customers all over the world in addition to the ones where our mines are located.


As we seek to provide our customers with the best possible product, we


keep looking for mines throughout the world. The mining sector is also changing, broadening, in terms of the applicable legal framework. This is a trend that we certainly have to look into.


Big mining projects always require infrastructure, both very regulated


areas. The infrastructure most of the time is not available and will have to be built on-site for a big mining project.


Normally, even before the mine activities start, a whole lot of infrastruc-


ture springs up around the mine. People come, new businesses and com- munities are formed, and you have to pay close attention to security matters. These are just some examples of things that usually come with a mining project regardless of where it is located.


Normally the places where a mining company has to go have an infra-


structure that is precarious. Look at the Moatize project in Mozambique, for example. It is a coal mine. There is no port or railway infrastructure with sufficient capacity to transport the nominal production of the mine to the exit ports. So Vale has to develop both railways and ports. These railways are also supposed to carry passengers which will bring development to the region, allow greater mobility of people, but also trigger health and safety


8 ENERGY & INFRASTRUCTURE | LATIN AMERICA 2013


How do you avoid the (potentially dangerous) perception of Vale peo- ple vs. non Vale people that you mentioned earlier? That is a common practice of our company. When we arrive in a country, we have guidelines, concerning how we should go and deal with a commu- nity. Logically we have to adapt, different countries have different realities, but at least certain guidelines are widely followed.


issues and we will have to look at the applicable laws and regulations. We do not want to create separate communities, we do not want there


to be a sense that there are people who work for Vale and people who don’t work for Vale, so when an improvement is made to the infrastructure and the logistic systems benefiting the workers, the whole community has to gain. Not just for the infrastructure – when anything at all is done for the mine, it has to be done in such a way that the entire community can con- sider itself as the beneficiary.


What are some complications that keep coming up on Vale’s mining projects? When it comes to a new mine, the construction of infrastructure to service that mine is a highly regulated activity. The use of a port, the use of a railway, the use of a certain road built for the project, present a few more challenges than in the case of oil and gas extraction. It has a bigger impact, you might say, than with oil and gas extraction. If you put together a railway, you will always find out that there are other companies that will also need to use the railway. Then you have individuals, you will need to provide services to them as well. It is a more complicated situation. When you put an oil rig in the middle of the sea with pipeline it is a more exclusive structure than the one you deal with in a mining situation.


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