A dam failure at an iron ore mine in south-eastern Brazil, shared by the BHP Billiton with Brazilian mining company Vale, caused a huge number of casualties at a nearby town on Thursday. The dam held waste-water from the mine which flooded the remote region with mud-water that gave officials a tough time in handling the incident.

Mining company Samarco, which the BHP Billiton owns 50 percent, issued a formal statement that said it has not yet been able to determine why the dam at its Germano mine burst suddenly. A BHP Billiton spokesperson has described the disaster, which resulted in the death of 16 people so far, as “serious.” The dam washed off a small village in the Minas Gerais, a mining state in south-eastern Brazil.

"BHP Billiton understands that a serious incident has occurred at the Samarco Mineracao SA's iron ore operation in Minas Gerais," the company said in a statement. "BHP Billiton is concerned for the safety of employees and the local community. We are in the process of obtaining more details from Samarco Mineração S.A. We will provide updated information on the situation as soon as we are in a position to do so."

Around 600 people are being evacuated from the village of Bento Rodrigues to higher land, the civil defence officials said. Local video footages showed the devastation that the dam failure has caused. The number of casualties also could not be confirmed. According to authorities, the floods have reached a nearby village and the people living there are also being moved to avoid any further damage to life.

The rescue teams continued the search even after nightfall.

Samarco produces around 10 percent of Brazil’s iron ore which stands at 30 million tonnes per year. Due to the weakening demand of iron ore in China, miners were having a tough time to deal with the declining iron ore prices.

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