CORRECTED-UPDATE 2-Vale cuts 2016 budget, sees $443 mln mine disaster costs

martes 1 de diciembre de 2015 15:33 GYT
 

(Corrects investment cuts to $6 billion in 2016, not by $6 billion; adds 2015 capital investment estimates in paragraph 2)

By Luc Cohen

NEW YORK Dec 1 (Reuters) - Brazil's Vale SA prepared investors on Tuesday for a difficult 2016, unveiling a plan that includes cutting capital investment to about $6 billion and $443 million in expected costs to clean up a November mine disaster.

Investment in 2016 will fall from the $8 billion-$8.5 billion budgeted for 2015 in August.

CEO Murilo Ferreira said environmental recovery from last month's dam burst at the Samarco joint venture co-owned with BHP Billiton Ltd would take time and a lot of help.

"We acknowledge the seriousness of the moment and we are committed to helping and already engaged in joint coordination," he said at the company's annual "Vale Day" event in New York. The disaster killed at least 13 people last month.

During the event, Fitch Ratings put Vale on negative watch, citing expectations the company will need to provide significant financial assistance. The agency also downgraded Samarco's debt ratings to BB- from BBB.

Ferreira said cutbacks next year were aimed at achieving positive cash flow in 2017 despite heavy investment to complete an expansion of its giant Carajas iron ore mine system in the Brazilian Amazon.

He said the company's asset-sale plan, including 11 Valemax ships, would help limit a potential 2016 cash-flow shortage.   Continuación...