Jaguar Mining cuts Brazil tailings dam fine, prepares to restart operations at Turmalina

Jaguar Mining reduces Brazil tailings fine to 60 million reais and outlines restart plan for Turmalina operations after December 2024 incident.

Jaguar Mining (TSX: JAG) has successfully negotiated a major reduction of the fine imposed by Brazil’s Minas Gerais state following a tailings pile rupture at its Turmalina gold mine last December. The original fine of 320 million reais (US$52.5 million) has been reduced to approximately 60 million reais (US$9.8 million) — just under one-fifth of the initial amount.

The incident occurred in early December at the Satinoco tailings pile within the MTL complex, located 130 km northwest of Belo Horizonte. The failure displaced hundreds of local residents and damaged nearby infrastructure, prompting the immediate suspension of mining operations and a substantial environmental fine by Brazilian authorities in January.

Environmental responsibility and structured payment

According to Jaguar Mining, nearly 24.5 million reais of the negotiated settlement will be allocated to socio-environmental projects within Minas Gerais. The remainder of the payment will be made in monthly installments with grace periods, a structure that supports the company’s financial liquidity and operational continuity.

“The payment structure balances fair compensation for the damage caused with the need to preserve the company’s financial stability,” Jaguar stated in a press release. The company emphasized that the agreement reflects its commitment to responsible corporate conduct and provides a clearer outlook for future operations.

Restart strategy for MTL complex

Jaguar’s newly appointed Deputy CEO, Albano Tondo, called the settlement a milestone in the company’s robust restart plan for operations at the MTL complex. He said it “demonstrates Jaguar’s determination to comprehensively and responsibly address the Satinoco incident.”

Earlier this month, the company disclosed a “structured and comprehensive plan” to resume mining operations at MTL, which includes updated technical studies and construction adjustments to ensure geotechnical safety standards at Satinoco meet or exceed current industry benchmarks.

In 2024, the MTL complex — comprising the Turmalina mine, its processing plant, and three satellite deposits — produced 23,710 ounces of gold, accounting for more than one-third of Jaguar’s total gold output. The company also operates the Caeté complex, home to the Pilar gold mine.

Share price recovery

Following the announcement, Jaguar’s shares rose 2.4% to C$3.78 on the Toronto Stock Exchange, giving the company a market capitalization of approximately US$300 million. The stock has now fully recovered from the losses it suffered in the aftermath of the tailings incident, when it dropped as low as C$1.97.