May 31, 2017 / 3:47 AM / 2 months ago

Dust explosion rocks Formosa steel plant in Vietnam that caused toxic spill

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FILE PHOTO: Formosa steel factory is seen in Vietnam's central Ha Tinh province March 31, 2017.Stringer/File Photo

TAIPEI/HANOI (Reuters) - A dust explosion rocked Taiwanese conglomerate Formosa Plastics Group's new steel plant in Vietnam late on Tuesday, a day after it resumed test operations for the first time since causing one of the country's worst environmental disasters last year.

The explosion was caused by the combustion of fine dust particles in the air as a result of an equipment malfunction, Chang Fu-ning, an executive vice president of Formosa Ha Tinh Steel, told Reuters.

The incident is likely to raise fresh concerns about the safety of the $11 billion plant, although Chang said there were no casualties and it would have little impact on preparations for the launch of production.

"Our equipment which collects dust suffered an explosion. We immediately cut off the power supply for a security check. We're trying to find out what caused it," Chang told Reuters by phone.

"There was no fire, damage or casualties as a result," he said. "The test-runs are still ongoing."

The provincial People's Committee in Ha Tinh confirmed that the explosion, triggered by limestone dust, had caused some physical damage but no injuries or environmental harm.

FILE PHOTO: Formosa steel factory is seen in Vietnam's central Ha Tinh province March 31, 2017.Stringer/File Photo

The Formosa Ha Tinh Steel plant spilled toxic waste that polluted more than 200 km (125 miles) of Vietnam's coastline in 2016, devastating sea life and local economies dependent on fishing and tourism. The plant restarted on Monday after its operations were halted in the wake of the disaster.

Formosa paid $500 million in compensation to affected communities and in March said it would boost investment by about $350 million in the steel project, amid public outcry against the company and the government's handling of the spill.

The fresh investment would go into improving environmental safety measures, raise working capital, buy material and build a dry coking system.

Ha Tinh's chief party secretary has asked Formosa to inform authorities of the cause of explosion within seven days. Formosa had confirmed it would fix the problem and check equipment to ensure a safe test run within 15 days, a statement from the province said.

The plant started test operations on Monday after receiving a test-run license from the Vietnamese government.

The company has said it hopes to start commercial production in the fourth quarter of this year, subject to an approval from the Vietnamese government.

Reporting by Faith Hung in TAIPEI and My Pham in HANOI; Editing by Stephen Coates and Sunil Nair

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